At the conclusion of Monday’s trading session, investors in Airtel Africa Plc, one of the main telecoms firms listed on the Nigerian Exchange Group Plc (NGX), incurred a loss of nearly N483 billion as the local market gave in to selling pressure.
The benchmark Index saw its worst one-day loss of the month, falling 2.08% to close at 53,750.77 points, as the market continued its losing run for a third session in a row.
The telecom stock, according to checks by Nairametrics, fell by 8.31% to settle at N1,420 per share from N1,548.70, which was the starting price at the start of day trading.
Subsequent investigation showed that Airtel Africa lost N483 billion (or 8.31%) throughout the day’s trading since its market capitalization on the Nigerian Exchange (NGX) ended up being N5.337 trillion as opposed to N5.820 trillion when trading started.
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The dip in share prices might be related to investors’ negative attitudes, which are influenced by the disputed 2023 general election results.
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According to Mr Mike Eze, managing director of Crane Securities Limited, the election, which many people felt didn’t live up to expectations, is also having an impact on stock prices since investors, primarily international ones, are staying away from Nigerian equities. Eze said that overseas investors are also experiencing panic sales as a result of election jitters.
Airtel Africa Plc (Nigeria) Q3 2022 Earnings
Airtel Africa’s revenue increase was 18% in Q3 of 2022 as the telecoms company maintained solid margins as our EBITDA margin climbed to 49%, $1.9 billion, a 17% rise at constant currency rates.
“Mobile service revenue in Nigeria climbed 21%, while East Africa and France-speaking markets gained roughly 30% in constant currency. I’ll divide Mobile Services’ voice and data performance.”
According to Airtel Africa Chief Executive Officer Segun Ogunsanya in March this year, “In Q3, the quarter ended December, our constant currency revenue growth was 18%. Despite the inflationary challenges, we are delivered on our mission to maintain steady margins as our EBITDA margin slightly increased to 49%, giving us an EBITDA for the period of $1.9 billion, an increase at constant currency terms of about 17%….”
He further explained that “In Nigeria, we continue to see strong trends in constant currency performance, 21% in the period and 3.4% in Q3. In East Africa, we reported a 16% revenue in constant currency with the France region growing 12.7% in constant currency as well. Let me begin by focusing [on] the performance of the mobile services segment. With strong demand for services across our certain countries, combined with a very attractive consumer-focused acquisition and distribution infrastructure drove a 10% increase in the customer base, with quarterly net additions at the highest level in over eight quarters.”
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On offsetting Airtel Africa’s debt, Ogunsanya said: “We also remain committed [to] strengthening our balance sheet by reducing further currency debt, while continuing to push that down to data revenue. Earlier this year, we redeemed $450 million of OpCo debt in advance, and we will continue to focus on reducing the debt further as we continue to upstream cost from our various OpCos. Over the last nine months, we are further investing in our network to enhance coverage and network quality. Almost 90% of our CapEx is targeted towards growth initiatives. In addition, we have also announced our spectrum footprint across a number of key markets.”