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Safaricom’s Financial Report: Net profits hit Ksh. 48.4 Billion

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Safaricom Limited has made public its financial report for the year 2016/2017. As expected, the company has increased its profits significantly to Ksh. 48.4 billion up from Ksh. 38.1 billion the previous financial year.

The announcement entailed a breakdown of the financial report to highlight the key drivers that have contributed to this growth. M-Pesa and data revenues were reported to be top drivers to the growth.

Included in the report also was the percentage of Kenyans who use mobile and the contribution of local telcos to the GDP. Specifically, Safaricom noted that presently, 90% of Kenyans are covered by mobile and that telecommunication companies have contributed 8% of the GDP.

A Summary of Safaricom’s Financial Report:

  • The company stated that over Ksh. 38 billion worth of infrastructure has been invested in improving user experience.
  • Safaricom has gained 3 million subscribers over the past year.
  • The net income increased by 18.3% to hit Ksh. 45.1 billion up from Ksh. 38.1 billion in the 2015/2016 financial year.
  • Voice revenue has increased from Ksh. 93.5 billion up from Ksh. 90.8 billion. This is a 2.9% growth.
  • Mobile date revenues saw a significant growth with an increased to Ksh. 29.3 billion up from Ksh. 21.2 billion. This was a 38.5% increase. The growth was attributed to an increase in 30-day active customers, increased data usage, and significant mobile penetration. Safaricom also reported a revenue increase of fixed data by 37.4% to Ksh. 5.2 billion. This growth is attributed to an increase in fixed service customers.
  • SMS revenue was down and this comes as no surprise given that people have increasingly adopted other cheaper messaging platforms such as Whatsapp. The revenue dropped by 3.7% to stand at Ksh. 16.68 billion compared to Ksh. 17.3 billion last year.
  • M-Pesa has been a major source of revenue for Safaricom hitting Ksh. 55.1 billion. This is a 32.7% growth and Safaricom attributes this to increase in active M-Pesa customers. The growth of Lipa na M-Pesa on a monthly basis has also been a major driving force behind this growth. Safaricom reported that a total of 6.8 trillion was transacted over M-Pesa in the just concluded financial year.
  • Total revenue is Ksh. 212.9 billion which is a significant increase from Ksh. 195.7 billion in 2016.

That’s Safaricom’s financial report for 2016/2017 in a nutshell.

Apart from this, other developments came to light:

  • Bob Collymore’s contract has been extended by 2 years

It comes as no surprise that Uncle Bob’s contract has been renewed for another two years. His old contract was expected to expire on August 2017 but the board has decided that we will be seeing more of him for an extra two years.

  • Safaricom’s latest product M-Pesa 1 Tap was announced

The report also included Safaricom’s latest innovation which is M-Pesa 1 Tap, a service that has been termed as the future of M-Pesa. As the name suggests, the new product is a tap and go payment method that should enhance M-Pesa transactions for customers. Payments can be done using a card, wristband, or an NFC badge.

Parting shot? Collymore announced that the giant telcos would continue to invest in its operations for better customer experiences. Precisely, the telcos is set to invest 38 billion and this is an increase from 35 billion in 2016.

 

 

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