Safaricom Hits Historic Billion-Dollar Earnings Despite Profit Dip

Safaricom Group, a prominent Kenyan telecommunications firm, has released its financial results for the year ending March 31, 2024. The company saw its net income grow by 1.2% to 63 billion shillings, which was lower than the projected 67.6 billion shillings anticipated by analysts. This modest increase was overshadowed by the impact of losses from its Ethiopian unit, which is in its first full year of operations. Despite this, Safaricom's revenue grew by 13.4% to 335.3 billion shillings, with significant contributions from its M-Pesa mobile financial service at 42.4% and GSM business at 52.7%.

Safaricom Kenya's net income grew by 14.7% to 84.74 billion shillings, and excluding minority interest, the group's net income increased by 1.2% to 62.99 billion shillings. However, the company's overall profit after tax decreased by 18.71% to 42.7 billion shillings due to its investments in the Ethiopian market. Despite the decline, the company's EBIT surpassed market expectations, registering at 139.9 billion shillings, a 20% increase from the previous year and marking a notable milestone as the first East African company to exceed a billion dollars in earnings.

CEO Peter Ndegwa expressed satisfaction with the company's overall performance, particularly highlighting the doubling of the active customer base in Ethiopia to 4.4 million. Looking ahead, Safaricom anticipates that Ethiopia will become a significant contributor to its growth from 2025 onwards. Additionally, the board is set to recommend a final dividend of 65 cents per ordinary share, culminating in a total dividend payout of 48.08 billion shillings for the financial year 2024.