Kenya’s Safaricom, East Africa’s most profitable company, saw its net profits increase by 1.2% to $480.84 million (KES62.99 billion) in the full year ending March 2024, with strong growth in mobile money service and internet driving the surge.
M-Pesa revenues grew 20% year-on-year, reaching $1 billion (KES140 billion) from $891.3 million (KES117.2 billion) in 2023, while mobile data revenues increased by 18% to $1.4 billion (KES189.8 billion). Voice revenue, on the other hand, declined by 0.6% to $608.4 million (KES80.5 billion).
Strong performance in B2B (39.8%) and P2P (15.4%) payments, along with increasing adoption of the firm’s global payments platform, drove M-Pesa’s growing profitability, which rose by 20% year-on-year.
The firm achieved a 20% increase in operating profit, reaching $1 billion (Sh140 billion), making it the first East African listed firm to surpass the billion-dollar milestone.
Profits at the operator’s Kenyan unit surged by 13.7% to $644.4 million (KES84.74 billion), but they were pulled down to $324.4 (KES42.66 billion) due to increased costs associated with its entry into the Ethiopian market.
Safaricom is banking on Ethiopia to bolster its regional dominance as growth in the Kenyan market decelerates. Peter Ndegwa, Safaricom’s chief executive, informed investors on Thursday that the firm aims to break even in 2015.
Ndegwa expressed his thrill with the accomplishments of our group, despite the considerable startup expenses in our Ethiopian venture. “We anticipate that starting from 2025, Ethiopia will become a substantial contributor to growth at the group level, both in terms of revenue and profit.”
Ndegwa emphasized that the regulatory environment in Ethiopia has bolstered the telco’s confidence in the market, marking its first significant expansion beyond Kenya. In April 2024, the Ethiopian Communications Authority (ECA), the telecommunications regulator, reduced mobile termination rates (MTR), creating a more equitable playing field for market participants.
“We’ve doubled our active customer base to 4.4 million, erected a world-class network nearly half the size of Kenya’s, and are progressing as planned to fulfill our licensing commitments,” Ndegwa stated.