Airtel Africa Plc said its subsidiary Airtel Nigeria has initiated a process under which it seeks to buy back the 8.27percent minority shareholdings at an offer price of N55.81 per share.
Assuming all minority shareholders of Airtel Nigeria decide to tender their shares, the total consideration is estimated to be N61.24billion (about $148.1million using an exchange rate of $/ N413.38). This represents an open offer to all shareholders.
Renewed spectrum licences in the 900MHz and 1800MHz bands to expire November 30
In January 2021, Airtel Networks Limited (Airtel Nigeria), announced that its application for renewal of the spectrum licences in the 900MHz and 1800MHz bands had been approved by the Nigerian Communications Commission (NCC).
Pursuant to Section 43 of the Nigerian Communications Act, 2003 and Condition 20 of the Unified Access Service Licence (UASL), Airtel Nigeria applied to renew the UASL (operations licence) and spectrum licences in the 900MHz and 1800MHz bands which would otherwise expire on November 30, 2021.
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Following the application, the NCC offered Airtel Nigeria the opportunity to renew its spectrum licences in the 900MHz and 1800MHz bands for a period of ten years, with effect from 1 December 2021 until 30 November 2031, which Airtel Nigeria accepted. Under the terms of the spectrum licences Airtel Nigeria paid 71.61 billion naira ($182 million) in respect of the licence renewal fees.
The UASL is still under consideration by the NCC and formal confirmation of renewal is expected before the expiry date of November 30, 2021.
In the financial year ended March 31, 2021 Airtel Africa Plc revenue from Nigeria grew by 13.1percent in reported currency, with constant currency growth of 21.9percent offset by Naira devaluation of 10percent (YoY). Reported currency revenue grew by 12percent in Q4’21, and 22.9percent in constant currency.
Voice revenue grew by 13.9percent in the year. This was driven by customer base growth of 0.5percent, and voice Average Revenue Per Unit (ARPU) growth of 2.9percent, supported by an increase in voice usage per customer, up 12.4percent. The customer base growth was supported by continued expansion of our distribution network and network infrastructure, with a slowdown in customer base growth in the second half of the year attributable to new “Know-Your-Customer” (KYC) requirements in Nigeria. In Q4’21, voice revenue grew by 12.9percent in constant currency, mainly driven by voice ARPU growth of 7.5percent, largely due to increased voice usage per customer.
Data revenue continues to be the key driver of Nigeria revenue growth
Data revenue continues to be the key driver of Nigeria revenue growth, with constant currency revenue growth of 36.2percent. This was driven by 5.6percent growth in the number of data customers, and 15.3percent growth in data ARPU. The data customer base growth was supported by expansion of our 4G network, with 84percent of total sites now on 4G. Data customer penetration increased to 42.1percent, up 2 percentage points from the prior year. Data ARPU increased 15.3percent from increased data usage per customer, which was up 47.4percent in the year from 1.9 GB per month to 2.8 GB per month. Q4’21 data usage was 3.2 GB per customer. Data revenue accounted for 35.4percent of total revenue in the year, up 3.7 percentage points from 31.7percent in the prior year.
Other revenue grew by 29.7percent, with the main contribution coming from growth in VAS revenue, led by airtime credit services. Underlying EBITDA grew by 12.8percent to $839million in reported currency, with a constant currency growth of 21.6percent. At 54.1percent, the underlying EBITDA margin was broadly in line with the prior year.
The slight decline year on year in the Q4 underlying EBITDA margin to 54.8percent (from 55.5percent) was due to increased operating expenses, largely from the rollout of new sites (over 1,400 added in the year). Capital expenditure was $275million, marginally lower than the prior year, largely due to logistical challenges faced during the pandemic. Operating free cash flow was $564m, up 53.6percent, from the combination of underlying EBITDA growth and capex reduction.
Share price of Airtel Africa Plc, the parent company of Airtel Nigeria closed last week on the Nigerian Exchange Limited (NGX) at N715 per share.
Airtel Africa is a leading provider of telecommunications and mobile money services, with a presence in 14 countries in Africa, primarily in East Africa and Central and West Africa. Airtel Africa offers an integrated suite of telecommunications solutions to its subscribers, including mobile voice and data services as well as mobile money services, both nationally and internationally.
Airtel Africa appointed Olusegun “Segun” Ogunsanya, as Managing Director and Chief Executive Officer. He has begun his new role as at October 1, 2021 and joined the Board of Airtel Africa plc.
“I am looking forward to building on the solid foundations the Group has established for future sustainable growth across Africa. Moving forward, we will invest even more in our network and distribution channels to serve the communities where we operate. By doing this, we will continue to sustainably bridge the digital divide, expand financial inclusion and meet the evolving needs of our customers,” Ogunsanya said.
Olusegun was previously Managing Director and CEO of Airtel Nigeria and was responsible for the overall management of the operations in the Company’s largest market. He has more than 25 years business management experience in banking, consumer goods and telecoms.
Before joining Airtel in 2012, Segun held leadership roles at Coca-Cola in Ghana, Nigeria, and Kenya (as MD and CEO). He has also been the Managing Director of Nigerian Bottling Company Ltd (Coca-Cola Hellenic owned) and Group head of retail banking operations at Ecobank Transnational Inc, covering 28 countries in Africa. He is an electronics engineer and also a chartered accountant.
