Despite the tough economic conditions occasioned by the COVID-19 pandemic, Safaricom managed to record a flat growth in the financial year ended 31st March 2021. During this period, Safaricom enabled Kenyans to reduce the impact of the pandemic by waiving fees for transactions below KES 1,000, which saw free transactions worth KES 4.4 billion processed. The telco’s Earnings/Profit Before Interest and Tax at KES 96.16 billion while the net profit for the financial year dropped by 6.8 percent to Sh68.67 billion from Sh73.65 billion recorded the previous year.
Service revenue recorded a marginal decline of 0.3% to close at KES 250.35 billion driven by double-digit growth in the mobile data business, which grew by 11.5% YoY to KES 44.79 billion. M-PESA and Voice revenue declined marginally with M-PESA recording a 2.1% drop YoY to KES 82. 64 billion and voice dropping by 4.6% to register a revenue of Kshs 82.55 billion.
“We remained resilient in a disruptive year, demonstrating strong operational capacity, diligence, and commitment in supporting the country, our customers, and shareholders through this uncertain time. Our immediate focus in the year has been to ensure that network capacity, operations, and financial services are prioritized to limit disruptions,” said Peter Ndegwa, Safaricom CEO.
M-PESA accounted for 33.0% of the total service revenue down from 33.6% last year, impacted by the waiver of the Peer-to-Peer (P2P) transactions fees. To support Micro and Small Medium Enterprises (MSMEs), Safaricom introduced the Pochi la Biashara, M-PESA Business App, Bill Manager, Merchant Transacting till, and Self On-Boarding process. Also, set to be launched is the consumer M-PESA App.
CEO Ndegwa noted that despite a tough financial year, the company will remain committed to investing in the business and maintaining a consistent dividend payout ratio in line with its dividend policy. He said the guidance for the Financial year 2022 is at the range of KES 105 – 108 billion for Earnings Before Interest and Tax and Capital Expenditure guidance in the range of KES 40-43 billion.
- 3% YoY decline in EBIT (Earnings before Interest and Tax) to KES 96.16bn with an EBIT margin of 36.5%, down 2.2ppts YoY.
- Net Income reduced by 6.8% YoY to KES 68bn.
- Free Cash Flow down 2% YoY to KES 64.52bn.
- Service revenue contracted by 3% to KES 250.35bn.
- Voice service (outgoing) revenue reduced by 6% YoY to KES 82.55bn.
- M-PESA revenue dropped by 1% YoY to KES 82.65bn.
- Mobile data revenue increased by 15% YoY to KES 44,79bn.
- Messaging revenue declined by 7% YoY to KES 13.60bn.
- The total one-month active customer base increased by 9% to 31.45Mn.
- One month active M-PESA customers increased 13.6% to 231mn.
- One month active mobile data customers increased 1% to 23.77mn.