Markets & Finance

Safaricom half year profit grows 94pc to Sh7.8b

bonga

Members of the public queue at a Safaricom customer care centre along Kimathi street. Safaricom has posted a 94 per cent growth in half year profit after tax to Sh7.8 billion Photo/File

Safaricom has posted a 94 per cent growth in half year profit after tax to Sh7.8 billion, recovering from the reduced performance last year driven by price wars

(Read: Higher call tariffs brighten Safaricom half-year prospects)

The strong performance in the six months to September has seen the company’s total revenue grow 19 per cent to Sh 59.1 billion.

Revenue from mobile and fixed data revenue increased by 30 per cent to Sh4.0 billion, while  revenue from the money transfer service M-PESA grew by 32 per cent to Sh 10.4 billion

“We are relieved to have recovered from the damaging price wars. We are now focusing on customer growth,” said Safaricom chief executive Bob Collymore while releasing the results on Thursday.

Mr Collymore said the company intends to enhance her M-PESA network in the next few months to curb outages that’s has recently  impacted its operations.

He said the company shall embark on voice network optimisation to deal with the ‘unacceptable number of drop calls’ in Nairobi.

Broadband growth

“As a business, we consider broadband to be one of our next frontiers for growth and therefore have invested in the underlying 3G, fibre and Wimax networks and ensured data handsets are affordable. We have discontinued unlimited mobile data bundles, and instead have developed new data bundle offerings which meet the needs of the various segments.

The CEO said the company has netted 1.2 million more customers over the last year and that the company’s data users increase by 30 per cent to stand at 5.6 million and a nine per cent increase in fixed data customers to 6,718.

“We have actively increased our number of M-PESA agents by 6,000 over the last few months, closing at 45,540 agents nationwide,” said Mr. Collymore.

He said M-PESA has shown significant growth with an increase in registered customers to 15.2m; 9.7m of whom actively use M-PESA at least once every 30 days.

The growth led to the 32 per cent increase in revenue to Ksh10.4 billion.

M-PESA now makes up 18 per cent of total revenues for the leading mobile telephony company.

The company’s total revenue in the period under review grew by 19 per cent to Sh59.1 billion and voice revenues grew by 19 per cent to Sh37.4 billion.

“The results for the Group have yet again demonstrated Safaricom’s strength and depth of services. They are a testament to prudent commercial management and our loyal customer base,” said Mr Collymore.

He said the company embarked on a number of promotions to maintain customer loyalty and grow revenue.

“In July 2012 we reduced our off-net call rate to the same rate as our on-net. Our commitment to offer quality services at an affordable price has paid off as demonstrated by the 19 per cent growth in voice revenues,” he added.

(PDF Download: Statement on Safaricom half year results)