(Africa)
Dear Shareholders,
FY 2016-17 turned out to be a reasonably good year for us in Africa despite significant environmental challenges. The year witnessed a gradual strengthening of our key operational metrics in different markets providing further momentum to our turnaround plan.
Our strategic considerations revolved around achieving distribution excellence, ensuring excellent overall network quality and enabling existing customers to garner more benefits from the networks. We also focused on optimising operations and developing our internal capabilities. Our initiatives have resulted in our operations delivering a positive PBT (Profit Before Tax) during the 2016-17 financial year (constant currency), for the first time ever.
During the course of the year, we have been diligent with respect to our attention towards Operational Excellence and Cost Management. Emphasis on running our operations efficiently and managing costs effectively have yielded results. Africa’s underlying revenues grew by 4.4% in constant currency, with net revenues up 5%. Against the backdrop of revenue growth, the EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) for the financial year 2016-17, saw a growth of 36% with margin expanding by 500+ basis points on an underlying basis (constant currency).
Some milestones over the period include:
Our emphasis has been to simplify our product offerings and accelerate growth through an enhanced customer experience. Consequently, our subscriber base increased by 7.2% over the previous financial year, taking the total to 80.1 Mn. Our on-going focus on acquiring quality customers resulted in lowering customer churn as well.
Data is a powerful growth vehicle and a key focus area for us. Continuous upgradation in our networks along with aggressive data bundle have resulted in growing our data consumption by 95% and revenues by 23.5%.
We also redesigned our distribution infrastructure to facilitate better reach and growth of Airtel Money. The Airtel Money service has been augmented by introduction of Microloans and International Money transfer facilities in 6 countries.
We continued to position Airtel as “The Smart phone Network” in Africa through our pan African services. Airtel was rated amongst the top 10 most admired brands in Africa in 2016-17 by Brand Africa.
People remain our most important asset at Airtel Africa. We continued to focus on improving ways of working, strengthening our talent and leadership in the commercial function and further developing key functional competences. We further worked toward sensuring that the organisation structures in HQ and OpCos are aligned and geared for effective commercial execution. During the year we have also reiterated our commitment to give back to the wider community through our CSR interventions in different markets.
I would like to take this opportunity to sincerely thank all our valued stakeholders - customers, shareholders, government bodies, business partners and employees for their unstinted support during the year. We remain firmly committed to usher in the benefits of the global voice and data revolution to our customers across the 15 countries that we operate in within Africa.
We are well positioned to continue our growth into 2017-18 in both subscriber addition and revenue, and will continue being guided by the strategic imperatives of distribution excellence, customer experience, network excellence, right cost model and the people development. I look forward to the upcoming fiscal year with great optimism and purpose.
Raghunath Mandava