Airtel Africa reports higher net loss for Q2 despite revenue growth

Airtel Africa posted a higher net loss of $170 million (€154 million) in the company's fiscal second quarter of 2015 (July to September), although revenue adjusted for the sale of tower assets increased by the highest rate in the last four quarters.

The company, which operates in 17 markets across Africa and is part of the India-based Bharti Airtel group, said the loss widened from $124 million in the same period a year previously due to taxes and finance costs. Adjusted EBITDA was also lower at $220 million ($206 million reported in constant currency) compared to $223 million in the corresponding quarter last year.

Revenue showed a more positive picture, rising 5.1 per cent adjusted for the sale of tower assets to €1.028 billion from $978 million in the corresponding quarter of last year. Revenue growth was 4 per cent in constant currency.

Christian de Faria, MD and CEO of Airtel Africa, said the underlying revenue growth of 5.1 per cent was the highest in the last four quarters.

"Data revenue has grown by 40.6 per cent. Strong demand is being witnessed both in voice and data with our consumption increasing by 19.5 per cent and 104.5 per cent respectively. Consistent net additions have expanded our customer base to more than 80 million with growth of 13.3 per cent," de Faria said.

He added that the company had divested tower assets worth $1.7 billion in the first half of this year.

The company did not mention the talks announced in July with Orange on the potential sale of Airtel's mobile subsidiaries in Burkina Faso, Chad, Congo Brazzaville and Sierra Leone. At the time, Airtel said the sale of the four units would enable it to "establish a sharper focus" on the remaining countries in Africa. Bharti Airtel first entered Africa in 2010 when it acquired Zain's mobile assets in 15 countries.

Looking ahead, the company has high hopes for further growth of 3G and 4G services as well as Airtel Money in Africa. The company currently offers 3G and the mobile money service in 17 countries and 4G services in three countries.

In the second quarter, data revenues contributed to 13.5 per cent of overall Africa revenues compared to 10.1 per cent in the corresponding quarter last year. The active Airtel Money customer base grew by 59.3 per cent year on year to 8.4 million.

Meanwhile Airtel has also obtained formal approval to use existing 1800 MHz spectrum to launch LTE services in the Democratic Republic of Congo (DRC), and said the government in Tanzania is proposing to auction 700 MHz and 800 MHz spectrum by next year.

In another notable development, Airtel and Liquid Telecom have signed a pan-African agreement to provide fibre connectivity to mobile towers and thereby enable faster 3G and 4G speeds. Liquid Telecom operates a 20,000 km fibre network across East, Central and Southern Africa.

For more:
- see the Bharti Airtel Q2 results
- see the Bharti Airtel release

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