June 14, 2024

Safaricom FY 24 Service Revenue Hits 329 Billion Mark

Safaricom FY 23/24 Service Revenue Hits 329 Billion Mark

Safaricom service revenue grew by 11.7% year-on-year to KES 329.8 billion for the year ended March 31, 2024. This is despite a challenging economic environment marked by rising inflation. Peter Ndegwa, CEO of Safaricom, highlighted the company’s resilience in a challenging economic climate.

“We are extremely pleased with what we have been able to achieve as a group despite the significant startup costs in our Ethiopia business.” he said.

He described FY’24 as an “outstanding year in Kenya” and noted that the Kenyan operation is now a “1-billion-dollar business.” The company believes the worst is behind them in terms of group performance.

Safaricom’s CFO, Dilip Pal, further noted that Earnings before Interest, Taxes, Depreciation, and Amortization margin for FY 24 was the best in the company’s recent history, closing at 54.7%.

Pal also pointed to the reintroduction of transaction charges between banks and M-Pesa as a factor contributing to M-Pesa revenue growth. Additionally, Lipa na M-Pesa and Pochi la Biashara tills are reported to contribute to 21% of business payments in Kenya.

The company’s group service revenue increased by 13.4% Year over Year to KShs 335.35 billion, mainly supported by M-Pesa, Mobile Data, and Fixed Data.

Overall, the Group’s customers grew 6.8% Year over Year to 49.02 million while one-month active customers grew by 9.1% Year on Year to 37.70 million. Safaricom Kenya’s overall market share stood at 65.9% as at December 2023.

The Group’s profit for the year attributable to equity holders of the parent grew 1.2% YoY to KShs 62.99 billion. Net income grew 13.7% Year over Year to KES 84.74 billion supported by M-PESA, Mobile Data and effective cost management initiatives in the period.

M-PESA revenue grew strongly by 19.4% YoY to KShs 139.91 billion driven by increased usage. Chargeable transactions per one-month active customers rose 33.9% YoY to 31.51 while Average Revenue per User grew 16.1% YoY to KShs 361.32. Total transaction value rose 9.4% Year over Year to KShs 39.39 trillion while volumes grew 34.7% YoY to 28.33Bn.

One-month active M-PESA customers grew 0.9% YoY to 32.41 million. Lipa Na M-PESA active merchants grew 4.3% Year over Year to 633.01k while pochi tills stood at 632.68k as at the end of FY24. M-PESA now accounts for 42.2% of service revenue, further complementing traditional voice and messaging services.

Mobile data revenue recorded a double-digit growth of 18.0% YoY to KShs 63.24. Safaricom continues to leverage price transformation, transparency, and personalized offers through Customer Value Management (CVM) initiatives to enhance affordability on their data offerings.

Data usage per chargeable subscriber increased by 6.4% YoY to 3.79GB while distinct bundle users grew 13.8% to 19.69 million. Average rate per Megabyte declined further by 4.6% Year over Year to 6.40 cents during the year.

The company continues to drive the penetration of 4G-enabled mobile devices through their device financing program while providing the right content to encourage usage. The number of smart phones on their network grew by 12.9% Year over Year to 22.93 million.

4G devices grew by 27.5% YoY to 16.85 million with 49.7% using more than 1GB while 5G devices rose by 79.3% YoY to 669.71k. Mobile data now accounts for 19.2% of Service Revenue.

Fixed service and wholesale transit revenue grew by 12.0% YoY to KShs 15.11 billion supported by growth in consumer revenue which rose 31.1% to KShs 6.48 billion and 0.9% YoY growth in Enterprise revenue to KShs 8.63 billion. Their fixed data market share stood at 36.7% as at December 2023 according to the Communications Authority of Kenya sector statistics report.

Read Also : Safaricom Ethiopia Grows Service Revenue To KShs 5.76Bn in FY 24

The company maintained its total dividend payout at KES 48.08 billion, translating to KES 1.20 per share. An interim dividend of KShs 0.55 per Ordinary share and a proposed final dividend of KShs 0.65 per share were declared.

The Group continues to be a major contributor to the Kenyan government’s revenue, remitting KShs 144.67 billion in duties, taxes, and license fees in the year ended March 31, 2024. This increased the total duties, taxes and fees paid since inception of Safaricom PLC to KShs 1.32 trillion.

Peter Ndegwa also emphasized Safaricom’s commitment to social impact. The company is involved in initiatives such as disbursing government funds through M-Pesa (Inua Jamii program) and collaborating with the government on digitization projects. Safaricom has also provided Ksh 30 million in aid to communities affected by floods.