Safaricom's net income grows to Sh63.4bn

In Summary

• Income before income tax grew 13.1% to Sh89.6 billion.

• Service revenue grew by 7% to Sh240.3 billion while Mpesa revenue grew by 19.2% to Sh74.99 billion. 

Safaricom chief executive Bob Collymore./FILE
Safaricom chief executive Bob Collymore./FILE

Safaricom's net income grew by 14.7 per cent to Sh63.4 billion up from Sh55.4 billion reported in 2018.

While announcing the results on Friday for the year ending March 31, CEO Bob Collymore said the Telco's earnings before income tax grew 13.1 per cent to Sh89.6 billion even as the firm faced a number of challenges ranging from  shrinking consumer wallet, increased taxes and the need for control and affordability.

Overall, Collymore said Safaricom's service revenue grew by 22.7 per cent to Sh240.3.

“We are pleased with the strong results we have delivered for the year, building on our long track record of delivering relevant products and putting the customer first. We foresee continued growth in the future,” Collymore said.

Mpesa revenue grew by 19.2 per cent to Sh74.99 billion, Collymore said. The service recorded a 10.2 per cent 30-day active customers to 22.6 million while its 30-day active mobile data customers increased by 6.6 per cent to 18.8 million.

Mobile data revenue increased by 6.4 per cent to Sh38.69  billion while messaging revenue declined by 1.3 per cent to Sh17.50 billion.

Voice service (incoming and outgoing) revenue grew marginally by 0.3 per cent to Sh95.94 billion while fixed service revenue increased by 22.7 per cent to Sh8.19 billion.

The CEO who presented the results after having missed last year's event due to poor health said Safaricom was ready for fair competition on a fair play playground where investment and innovation are the true differentiator.

 "We have grown past the battles between the banks and's time we talk on collaboration," Collymore said.

Collymore said the firm's credit facility, Fuliza, has had an incredible uptake since its launch three months ago with customers having borrowed Sh45 billion to date.

According to Collymore, the facility has since seen a total of Sh29 billion completed transactions over the period under review.

So far,  8.8 million customers have opted into Fuliza, with 4.4 subscribers having opted in in the first month alone and borrowed Sh6.2 billion.

Collymore said Safaricom's customer base now stands at 31.8 million out of over 49 million mobile subscribers in Kenya.

Mpesa subscribers have grown by 19.2 per cent to 22.6 million from 16.6 million in 2016.

Collymore, however, said there has been a slowdown in the uptake of mobile data where marginal growth of 6.4 per cent was experienced during the period under review compared to 24 percentage growth recorded in 2018.

Following the net income growth, the firm proposed to spend Sh50.08 billion on dividends at a cost of Sh1.25 per share.

Safaricom further proposed to pay out Sh24.84 billion on special dividends at a cost of 0.62 cents per share. 

Collymore said Safaricom will pump over Sh36 billion to double its 4G network coverage to 5000 base stations by March 2020.

This, he said, will cover all major towns and 80 per cent of Kenya's population.

“For a majority of Kenyans, the mobile phone is often the first and only link to the Internet. We aim to ensure that no one has to miss an opportunity or get left out because of lack of access to affordable, quality, high-speed broadband,”  Collymore said.

Safaricom became the first to roll out a 4G network in Kenya in 2014, and in June 2017, became the first in East Africa to upgrade a section of its 4G network to 4G+.

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