Airtel Africa swings to $80 million profit despite Naira hit, legal costs

Economic Times

08-05-2025

Bharti Airtel's Africa unit reported $80 million in net profit, compared to a net loss of $91 million, a year ago, in the fiscal fourth quarter, driven by an increase in its customer base and higher data usage, which offset higher finance costs.
ADVERTISEMENT But net profit for January-March period slumped 52.6% sequentially, reflecting a $21 million charge of derivative and foreign exchange losses, particularly due to the devaluation of the Nigerian Naira.
Net profit was also dragged sequentially by a $16-million exceptional expense, as provision for settlement of a legal dispute with a former group subsidiary.
Airtel Africa's quarterly revenue rose 23.2% on-year in constant currency to $1.131 billion, helped by tariff adjustments in Nigeria and easing currency headwinds.'An improving operating environment and focussed execution contributed to strong momentum in our financial results with constant currency revenue growth peaking at 23.2% in Q4'25. Part of this acceleration in the last quarter has also been driven by the Nigerian tariff adjustments,' said Sunil Taldar, Airtel Africa CEO in a statement.The data user base of Airtel Africa rose 2.8% on-quarter and 14.1% on-year, to 73.4 million in Q4 FY2025. Data revenue increased 7% sequentially and 33.4% on-year, to $524 million, helped by a 3.3% increase in data consumption.
ADVERTISEMENT The overall customer base across the telco's 14 African markets rose 1.8% on-quarter to 166.1 million.Airtel Africa's average revenue per user (ARPU) — a key performance metric — slipped 0.8% sequentially to $2.4, due to a 54.4% sequential fall in net customer additions.
ADVERTISEMENT Taldar added that Airtel Africa is making significant progress in preparing for the Airtel Money IPO, anticipating a listing in the first half of 2026, subject to evolving market conditions.Airtel Africa's mobile money customer base grew to 44.6 million in the March quarter, from 44.3 million in the previous quarter. ARPU from mobile money services fell 3.7% to $2, while quarter revenue from the mobile money business grew 0.5% sequentially to $269 million.
ADVERTISEMENT Airtel Africa's overall net finance cost (before exceptional items) for the March quarter was at $221 million, up 56% on-year and 1.8% sequentially, due to tower contract renewals and an increase in OpCo market debt.Finance costs also increased due to a shift of debt from foreign currency to local currency, which typically carries a higher average interest rate. The group has increased the proportion of local currency OpCo debt (excluding lease liabilities) to 93% as of March 31, 2025, up from 83% a year ago.
ADVERTISEMENT Capex for the year ended March 31, 2025 at $670 million was 9% lower than a year ago, due to a deferral of data center investment. 'Capex guidance for the next year is between $725m and $750m as we continue to invest for future growth,' the company said.Accelerating revenue growth and cost controls led to an increase in quarterly operating margins by 200 basis points to 47.3% in Q4 2025 from 45.3% in Q1 2025. Operating margin in FY3Q was 46.9%.
'We remain focussed on further EBITDA margin improvements subject to macroeconomic stability. This, combined with our robust capital structure and disciplined capital allocation, puts us in a strong position to continue investing in network capacity to deliver continued growth,' it added.
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