Report
EUR 4.00 For Business Accounts Only

Airtel Africa Plc Q1:2024 Performance - The Constraints of Unrealized FX Losses

The Constraints of Unrealized FX Losses

Revenue Growth Offset by FX Losses

In its recently released Q1:2024 financial result, Airtel Africa Plc (AIRTELAFRI) posted growth in its consolidated topline in reporting currency. During the period, markets in Nigeria and East Africa noted significant currency devaluations which depressed AIRTELAFRI’s Opco’s constant currency growth levels upon a Group consolidation.

Solid Operating Margins: Delayed Impact of Naira FX Devaluation

In reporting currency, AIRTELAFRI’s lower operating costs of USD702.50mn (down to +8.86% YoY from +10.98% YoY in Q1:2023) supported a decent EBITDA growth in Q1:2024. EBITDA was higher by 11.11% YoY to USD681.79mn in Q1:2024.

After considering the factors outlined, we maintain our bearish stance on Airtel Africa Plc. and retain "SELL" recommendation, with a revised target price of NGN1173.84 (11.07% downside potential as of August 8th, 2023).

Underlying
Airtel Africa

Airtel Africa PLC Formerly known as Airtel Africa Ltd. Airtel Africa PLC is a United Kingdom-based provider of telecommunications and mobile money services. The Company offers an integrated suite of telecommunications solutions, including mobile voice and data services as well as mobile money services both nationally and internationally. It offers traditional mobile voice services, with a primary focus on data and non-voice services through its third generation (3G) and fourth generation (4G) networks. It also offers mobile money services under its Airtel Money brand to customers in all of the Company's 14 countries of operation in Africa, primarily in East Africa and Central and West Africa. The mobile voice business line comprises pre- and post-paid wireless voice services, international roaming and fixed-line telephone services. The mobile data business line comprises data communications services, including second generation (2G), 3G and, increasingly, 4G data services, and other value added services (VAS).

Provider
ARM Securities Limited
ARM Securities Limited

ARM Securities Limited is a full-service brokerage house that offers best-in-class brokerage services to local as well as foreign private and institutional investors. Formerly known as Hamilton Hammer, the Company commenced operation in 1994 and was acquired by ARM Investment Managers in 2008--an acquisition which has successfully re-positioned the company as a recognized brokerage firm in Nigeria. The Company is a dealing member of the Nigerian Stock Exchange (NSE) and is regulated by Securities and Exchange Commission (SEC). ARM Securities research team provides insightful commentaries on the Nigerian economy and its equity and debt markets using an approach which incorporates a thorough understanding of the fundamentals of the industries and companies under coverage. The research therefore adopts an integrated methodology of top-down analysis and bottom-up stock selection, which focuses on publicly quoted companies on the Nigerian Stock Exchange that are judged to offer the highest potential for earnings growth. In addition, its analysts provide periodic commentaries on a range of topical global and local issues which provide investing clients with a holistic view of the opportunities and risks in today’s financial market landscape. ​

Other Reports on these Companies
Other Reports from ARM Securities Limited

ResearchPool Subscriptions

Get the most out of your insights

Get in touch