Home ECONOMY Safaricom earnings hit KSh 73.7 Billion on digital dividends

Safaricom earnings hit KSh 73.7 Billion on digital dividends

by biasharadigest

Riding on a shift by subscribers to digital platforms, Kenya’s leading mobile phone operator Safaricom recorded a 19.5 per cent growth in net earnings to KSh 74.7 Billion for the financial year ended 31st March, 2020. The firm recorded a 4.8% rise in revenue, driven by sustained customer acquisition, a return to double-digit mobile data growth and continued M-PESA and fixed data growth. The growth was partially offset by a contraction of the betting industry and the free transaction fees associated with the mobile industry’s COVID-19 response.

The Board of Directors has proposed a dividend payout of KSh 56.09 Billion, at the rate of KSh 1.40 per share.

The splendid financial performance puts the telco in much better shape to weather market crises amid the impact of the Covid-19 pandemic.

“Our most critical support to the country remains to ensure network stability to support the usage in M-PESA, voice, SMS and data. As working from home becomes the new normal, this is a shift that we should be able to support effortlessly,” says Nicholas Nganga Chairman of Safaricom’s Board of Directors in a letter to shareholders ahead of the upcoming AGM.

He adds that Safaricom is keen to support both the authorities to find thoughtful ways to maximise revenue collection while also assisting businesses to grow.

“The COVID-19 pandemic has brought to the fore the importance of technology in all our lives. Technology holds the world together and it has become one of the most important platforms for connecting people around the globe,” notes Peter Ndegwa, Safaricom CEO.

He adds that despite the high percentage in mobile telephone penetration in Kenya, a large part of the population still relies on 2G handsets, with affordability being the main reason they do not have a 4G-enabled handset.

“Changing this will take time. We are bridging the gap through our ground-breaking Lipa Mdogo Mdogo campaign by offering a device financing programme in partnership with Google and Teleone. It is the first initiative of its kind in the world to give customers access to quality 4G phones under a flexible payment plan,” said Ndegwa.

The telco aims to have one million more customers gain access to the power of the internet.

“On an underlying basis, service revenue increased 5.9%. We sustained strong investment with capital additions amounting to KSh 36.10 Billion. Capex intensity reduced 1.1% year on year to 13.8% as we continued to focus on enhancing monetisation and cost-saving opportunities upon deployment,” said Michael Joseph, Safaricom Outgoing Chief Executive.

While the months ahead will be challenging, Safaricom has expressed confidence that it will navigate its way through the uncertainty and play a key role in supporting the country through the post-COVID recovery period.

2020 AGM

In a notice to shareholders, Safaricom has indicated that its Annual General Meeting(AGM) for the year 2020 will be held via electronic communication on Friday, 31st July 2020 at 11:00 a.m

The dividend will be payable on or about 31st August 2020 to the Shareholders on the Register of Members as at the close of business on 31st July 2020.

The AGM will be streamed live via a link which shall be provided to all shareholders who will have registered to participate in the AGM. Duly registered shareholders and proxies will receive a short message service (SMS/USSD) prompt on their registered mobile numbers, 24 hours prior to the AGM acting as a reminder of the AGM.

A second SMS/USSD prompt shall be sent one hour ahead of the AGM, reminding duly registered shareholders and proxies that the AGM will begin in an hours’ time and providing a link to the live stream.

Registered shareholders and proxies may follow the proceedings of the AGM using the live stream platform and may access the agenda. Duly registered shareholders and proxies may vote (when prompted by the Chairman) via the USSD prompts.

The preferred method of paying dividends which are below KSh140,000 is through M-PESA for shareholders who wish to receive their dividends through mobile money.

Those who have not registered for this mode of payment are advised to opt to receive future dividends via M-PESA when registering for the AGM via the USSD or contact Image Registrars or Safaricom PLC’s Investor Relations Team.

Shareholders are encouraged to continuously monitor the Company’s website www.safaricom.co.ke for updates relating to the AGM.

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