Kenya: M-Pesa and mobile data boost Safaricom’s 2019 growth

Kenya: M-Pesa and mobile data boost Safaricom’s 2019 growth

From left to right: Nicholas Nganga, President of Safaricom, Peter Ndegwa, Chief Executive Officer and Sateeh Kamath, Chief Financial Officer. The three executives presented the operator’s 2019 results via videoconference © Safaricom/Youtube/2020 It was in the aseptic atmosphere of an empty press room that Safaricom’s managers once again demonstrated the financial strength of the group they lead.

Managed – remotely – since the end of March by the Kenyan Peter Ndegwa, the telecommunications operator has recorded a turnover of 262.5 billion Kenyan shillings for its 2019 financial year, or more than 2.23 billion euros with profits before interest (Ebit) up 13.5% compared to 2018 at 101 billion shillings.

READ MORE Kenya: Safaricom paves the way for its new CEO

This double-digit growth is driven by an unprecedented reduction in operating expenses. And of course by its flagship application, M-Pesa, available in 167 countries, which alone contributes 12.6% of the group’s growth (33.6% of revenues in 2019).

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Another dynamic segment, mobile data, particularly via 4G, recorded revenues of 40.7 billion shillings, up 12% year-on-year.

This was not without risk for the operator, which launched an unlimited voice and data offer in October. The latter already accounts for 40% of the segment’s revenues.

READ MORE In conversation with Bob Collymore, CEO of Safaricom

Peter Ndegwa is determined to pursue mobile penetration in Kenya, which he considers “perfectible”, and following the results announced a partnership with Google to offer one million smartphones at twenty shillings per month, which will be available on the market for nine months. Highly profitable “apps within the app”

The M-Pesa and mobile data diptych is therefore now the growth lever that is offsetting losses on traditional voice (-8 points compared to 2017) and messaging (-1.4 points compared to 2017). This is a vein that is more than ever to be exploited for the firm controlled by the British company Vodafone through its pan-African subsidiary, Vodacom, domiciled in South Africa.

READ MORE Vodacom and Safaricom in the driver’s seat for M-Pesa This is why the Vodacom-Safaricom duo has created a joint venture with full powers to make M-Pesa a “super-app” to provide for various needs such as booking taxis, making various appointments or paying for various services by mobile phone. Safaricom launched new services as early as 2013, with M-Shwari, Fuliza and KCB M-Pesa came later to […]

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