Safaricom’s profit slumped to Ksh.30.2 billion in its 2022 half year results.
This is an 18.4 percent drop from Ksh.37.1 billion the telco posted same period last year.
It comes against the backdrop of a network roll out in Ethiopia in October this year as the company eyes to expand in the larger Sub Saharan Africa region
According to Safaricom, it returned a loss of Ksh.4.1 billion after it hit a Ksh.6 billion in operating cost.
“This results are in line with our expectations. Safaricom Ethiopia requires significant capital investments before it can turn a profit,” said Safaricom Plc Chief Finance Officer Dilip Pal.
The company posted a slow growth for its Kenyan operations at 0.6 percent due to new taxes levied on SIM cards and a reduction in Mobile Termination Rates (MTR).
This, according to Safaricom Chief Executive Officer Peter Ndegwa, cost the firm Ksh.740 million.
“The half year under review was challenging for all of us. On the regulatory front, a review of mobile terminations rates and the introduction of new taxes on SIM cards and mobile phones slowed down industry momentum,” said Ndegwa.
Service revenue grew by 4.6 percent. Voiece and messaging revenue on the other hand surged by 3.8 and 7.7 respectively to Ksh.39.9 billion and Ksh.5.4 billion, respectively.
M-Pesa revenues grew by 8.7 per cent to Ksh.56.9 billion from Ksh.52.3 billion a year ago.
Mobile data revenue surged by 11.3 percent to Ksh.26.3 billion from Ksh.23.6 billion last year. Fixed data service revenues grew by 23 per cent to Ksh.6.8 billion.
The company expects its full year financial results in March 2023 to stand at between Ksh.87 billion and Ksh.93 billion.
