Safaricom is set to launch commercial operations in Ethiopia this year as part of the company’s regional expansion efforts to provide telecommunication services to over 112 million Ethiopians.
The Ethiopian venture recruited a team of over 300 staff, of which 50 percent is local talent, with plans of reaching 1,000 in the next financial year. The business also has onboarded distributors, secured four retail shop locations and set up the first outsourced call centre in Addis Ababa.
Safaricom Ethiopia has secured approvals for towers development, built two data centres, made the first test call, sent out the first test SMS and completed the first data session.
“We have made significant progress towards a commercial launch. We are engaging with the Ethiopian Communications Authority and other relevant partners about the requirements for ensuring a commercial launch this year,” said Safaricom chief executive Peter Ndegwa during the telco’s financial results release for the full year ended March 31, 2022 on May 12, 2022.
Safaricom’s net income increased by 5.4 percent to Ksh.72.35 billion for Safaricom Kenya and declined 1.7 percent to Ksh.67.50 billion including the impact of Ksh.4.66 Billion financing costs for the Ethiopia business.
Safaricom Ethiopia plans to bring mobile financial services to Ethiopia. However, this is subject to the licensing and regulatory process by the Government of Ethiopia.
Safaricom increased its Service Revenue by 12.3 percent to Ksh.281.11 billion and Earnings Before Interest and Tax (EBIT) by 13.5 percent to Ksh.109.13 billion.
Voice service revenue grew by 0.8 percent to Ksh.83.21 billion; mobile data revenue grew by 8.1 percent to Ksh.48.44 billion, while M-Pesa revenue grew by 30.3 percent to Ksh.107.69 billion.
“Our strong growth and achievements this financial year are due to the strong strategy execution, a dedicated staff force, and the business commitment to prioritize the needs of our customers. We will continue to be a sustainable purpose-led business as we transition to become a technology company by 2025.”
The continued focus on customers led to a 6.4 percent increase to 42.44 million in one month active subscribers for the period, with customers growing across all revenue streams.
Safaricom invested over Ksh.39.34 billion in Capital Expenditure (CAPEX) in Kenya to maintain and expand the network and ensure Kenyans enjoy reliable network coverage across the country and uninterrupted data services.
It also invested Ksh.10.44 billion in Ethiopia as it fast tracks network rollout plans. This brings the total CAPEX spending for the year under review to Ksh.49.78 billion a 42.4 percent increase from last year.
M-Pesa, which marked its 15th anniversary this year, hit the 30 million active customer mark in Kenya.
A significant sign of M-Pesa’s progress was the 63.4% growth of Lipa na M-Pesa merchants to just below 500,000. M-Pesa now has over 3.2 million businesses accepting payments under its portfolio, while the M-Pesa business app has about 100,000 active businesses.
With the new business strategy and the renewed focus on the customer, Safaricom, in the new Financial Year, plans to accelerate new growth areas, delivering superior customer experience in order to be a purpose-led Technology Company by the end of 2025.
