Airtel Africa to focus on current markets, will not bid for licences in Ethiopia - CEO

Airtel says it has no plans to extend its services to other markets.
Airtel says it has no plans to extend its services to other markets.
Image: 123RF/ANDRIY

NAIROBI - Airtel Africa will focus on growing in the markets where it already operates on the continent and will not bid for licences in Ethiopia, where the nation of 110 million people is opening up its telecoms sector, the company's CEO said on Friday.

Africa's second most populous nation, one of the last remaining closed telecoms markets on the continent, plans to sell a minority stake in state-owned Ethio Telecoms within nine months and is tendering for two new licences, a process that was expected to start last month.

But Airtel Africa Plc Chief Executive Officer Raghunath Mandava told Reuters that the Africa-focused telecoms company sees more room to grow in the 14 countries it has already invested in, including in its biggest market in Nigeria, the continent's most populous nation.

"We have a lower market share in Nigeria, Congo, DRC, Tanzania and Kenya. And our entire current focus is on these countries in order to grow, we are not looking at bidding for Ethiopia at this stage," he said in an interview.

On Friday, the company, in which India's Bharti Airtel Ltd is a shareholder, said that its nine-month reported revenue increased by 13.8% to $2.87 billion, with third quarter revenue up by 19.5%.

The company reported a slight decline in profit before tax to $482 million in the period to Dec. 31, 2020 from $501 million in the period to Dec. 31, 2019. It attributed the drop to a combination of higher finance costs and benefits from non-operating exceptional items in the prior period.

Excluding the benefit of exceptional items and the one-off derivative gain in the prior period, profit before tax rose by 20.4%, it said.

The company said that its Nigerian subsidiary has collected national identity numbers from nearly half of its customers as part of a process to adhere to regulator demands to add valid National Identification Numbers to every SIM card registered in the country. It was working to verify the data, Mandava said.

"This could require a little bit more time and we will not be able to complete the full exercise, in which case, after all efforts if we don't manage by Feb. 9 then we will, I am sure discuss with the government and request for some extension," he told Reuters.

 

GOING SOLO

After Airtel Kenya's merger with Telkom fell through, the company has "invested solo" on expanding its rural network as a way to compete with market leader Safaricom.

"We are consistently gaining market share over the last few years, and we are growing quite handsomely in Kenya on our own," Mandava said.

"During the last couple of months and the whole of next year, our big focus will be Kenya and Tanzania where we are going to roll-out huge networks," he added.

The company still sees voice as crucial to growth in the future, as huge swathes of the continent are still under-using their phones, as costs still remain high.

"We all need to work towards reducing this interconnect costs in some countries," Mandava said.

"The need for telecommunication is far higher, it's a latent, inherent demand that exists, that we as operators are not fulfilling enough. And if you can do a good job of it, you can grow faster."

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