Safaricom profit hits record Sh45bn, as board extends Collymore’s term

Pedestrians walk past a mobile phone care centre operated by Safaricom in the central business ...
Pedestrians walk past a mobile phone care centre operated by Safaricom in the central business district of Kenya's capital Nairobi, May 11, 2016. REUTERS/Thomas Mukoya

Telecom operator Safaricom continued to forge ahead as one of East Africa’s most profitable company, posting a full year net profit of Sh45 billion.

The rising popularity of M-Pesa as a payment solution continued to drive up Safaricom’s revenue even as it looks to continue innovating and investing to outpace its competitors.

Total revenue for the year stood at Sh212 billion, with revenue from its mobile money transfer service becoming the second largest contributor with Sh55 billion.

Voice revenue continues to be the operator’s bread and butter, contributing Sh93.4 billion to the bottom line while data added a further Sh29.3 billion.

Speaking while announcing the results, Safaricom chief executive officer Bob Collymore said the potential for future growth remains immense, with firm likely to continue investing in tech solutions to woo more customers.

“We have added three million customers on our network in the past 12 months and if you get that customer growth that is a big driver for it. We wanted to focus on customers, get the right products and services and increase our operational excellence,” Mr Collymore said.

The performance appeared to boost the telecom’s board confidence in its CEO, extending his contract by a further two years that will see him serve well into 2019.

The success however further adds to calls by regulators and industry operator’s to shake up the industry by seeing how to rein in Safaricom’s dominance.

While Safaricom openly admits to being a market leader, Mr Collymore remains opposed to plans to split the company.

An area the giant telecom has agreed to budge is the sharing of its M-Pesa network with the other telecom operators.

The interoperability is set to functional from August.

Following the release of their results, the Safaricom board has proposed a Sh0.97 dividend per share, subject to shareholder approval.

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