COVID-19 bites into Safaricom profits

The network operator saw net profit decrease to KES33.07 billion (US$304 million) with service revenue declining to KES118.41 billion ($1.09 billion).

Ola Olaoluwa
Ola Olaoluwa

The economic fallout from the COVID-19 pandemic has eaten into Safaricom's first-half earnings with a 6% drop in net profit and a 4.8% decrease in service revenue for the six months to September 30, 2020.

The Kenyan operator saw net profit decrease to KES33.07 billion (US$304 million) with service revenue declining to KES118.41 billion ($1.09 billion), Connecting Africa reports.

Voice service revenue dropped by 6.5% to KES40.19 billion ($369 million), while M-Pesa revenue dropped by 14.5% to KES 35.89 billion ($330 million). Messaging revenue also declined by 6.9% but mobile data revenue increased by 14.1%.

Safaricom Acting CFO, Ilana Darcy, Speaking at the 2020/2021 Half-year results presentation in Nairobi

Service revenue slowed down in the first quarter, declining 8.4% year-on-year (YoY), however some recovery was visible in the second quarter with a smaller decline of 1.2% YoY as COVID-19 restrictions began to lift in Kenya.

Board chairman, and ex-CEO, Michael Joseph said the board was encouraged by the positive trajectory witnessed in the second quarter.

Kenya In Focus:

Population: 52.6 million (Compared to South Africa's 59.6 million)

GDP: $95.5 billion (Compared to South Africa's $369.85 billion)

GDP Per Capita: $1,750 (Compared to South Africa's $6,193)

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Ola Olaoluwa

Writer | Economist