Safaricom net profit jumps to Sh74.7bn

Safaricom #ticker:SCOM net profit for the full year ended March this year jumped 19.54 percent to Sh74.7 billion on strong M-Pesa and mobile data revenue growth that offset a decline in voice and messaging (SMS) revenues.

During period, Safaricom’s M-Pesa revenue grew by 12.6 percent to Sh84.44 billion as mobile data revenue increased by 12.1 percent to Sh40.67 billion.

Voice service revenue (drawn from incoming and outgoing calls), which makes up the bulk of the telco’s revenues, declined 1.4 percent to Sh94.45 billion, while messaging income declined by 12.3 percent to Sh17.9 billion.

“The results reflect the commitment this customer centricity approach, with a steady growth in service revenue while mobile data is now back to double digit growth,” said Safaricom former chief executive Michael Joseph.

“I am proud of what the team has been able to deliver despite such a tough business year. We have stayed the course, given customers more value, and put the consumer first by delivering relevant products and services.”

Safaricom CEO Peter Ndegwa, who took the reins on April 1, said the company is going forward betting on M-Pesa, data business and entry into other markets like Ethiopia as well as innovations to shape the firm’s future profitability.

“Safaricom has always been the pioneer in many ground-breaking innovations, and I am committed to continuing this path with a focus to tap into the vast opportunity in the agriculture, health, education, and public sectors,” said Mr Ndegwa.

“Leveraging the power of partnerships and the digital platforms we operate, I aim to drive affordable and innovative products in mobile communication, financial services and enterprise solutions whilst maintaining leadership in the best network quality,” he added.

As part of the deal to “democratise” usage of data among Kenyans, Mr Ndegwa said Safaricom plans to target about Sh1 million customers with affordable smartphones.

The plan in partnership with Google will see low-income earners pay as little as Sh20 upto to a year to acquire smartphones and to upgrade to 4G enabled devices.

During the year ended March, Safaricom’s service revenue was up 4.8 percent per cent to Sh251.22 billion.

Against this performance, the board has proposed payment a final dividend of Sh1.40 per share amounting to Sh56.09 billion.

The firm paid a dividend of Sh50.08 billion in the previous year.