Kenya's Safaricom raises forecasts on sharp rise in subscribers
06 November 2015, 09:48
Nairobi - Kenya's Safaricom raised its
full-year income forecast on Thursday due a sharp rise in new subscribers and
revenue as customers increasingly used its mobile payments system and more
lucrative data services in the first half of the year.
Safaricom's revenue jumped by 23 percent to 97.22 billion
shillings ($952.67 million), while earnings before interest, taxation,
depreciation and amortisation (EBITDA) rose 16 percent to 38.8 billion
Safaricom, which is 40 percent owned by Britain's Vodafone
and has Kenya's biggest subscriber base, said it now expects net income to be
in the 35.5 billion to 36.5 billion shilling range for this financial year,
which ends March 31, up from 32 billion to 34 billion shillings previously.
John Tombleson, its chief finance officer, said the company
has attracted 3.25 million new customers over the last year.
"It is this increased customer base, as well as
additional usage from our pre-existing customers, that has driven our growth
and therefore upgraded guidance," Tombleson said in a email.
Safaricom also raised its guidance for free cashflow to 27.5
billion to 28.5 billion shillings, up from 25 billion to 26 billion shillings
Its revenue from calls, which accounts for close to half of
the total, grew 3.5 percent, while revenue from mobile data services rose to
9.16 billion shillings from 6.50 billion shillings.
Revenue from its mobile money service, known as M-Pesa,
jumped 24 percent to 19.35 billion shillings.
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Data and M-Pesa account for about 30 percent of revenue.
Safaricom said earnings per share rose 23 percent to 0.45
At 1200 GMT, Safaricom shares were up 4.9 percent at 15.00
shillings, after rising to an intraday high of 15.10 shillings.
"Twenty three percent (rise in EPS) definitely beat the
market expectations, so we expect to see the share price edge up," said
Linet Muriungi, senior associate at Dyer and Blair Investment Bank.
Safaricom said most of its capital expenditure during the
six months went on speeding up its network expansion, with its 4G service now
covering 14 towns and its 3G network now covering 73 percent of the population.