Airtel Africa, the London-listed telecommunications and mobile money-services provider focused on Africa, announced a pretax loss for the first quarter of fiscal 2024. The loss was primarily attributed to higher costs and the impact of foreign exchange headwinds resulting from the devaluation of the Nigerian naira in June.
Managing Foreign Exchange Risk
Despite the challenging economic environment, Airtel Africa remains optimistic about the future. The company expects foreign exchange reforms to gradually improve liquidity over time. To mitigate the impact of potential future devaluations, Airtel Africa is committed to reducing its foreign exchange exposure. This focus on risk management will be a key priority for the group going forward.
For the quarter ended June 30, Airtel Africa reported a pretax loss of $221 million, in contrast to a pretax profit of $276 million for the same period last year. The company also experienced a swing to a loss after tax, with a figure of $151 million compared to a profit after tax of $175 million previously. The losses were largely attributable to a significant foreign exchange loss of $471 million recorded in finance cost before tax, and $371 million after tax, due to the devaluation of Nigeria's currency.
In more positive news, Airtel Africa saw its revenue rise to $1.38 billion for the quarter, up from $1.26 billion for the same period in the previous year.
Airtel Africa's financial performance in the first quarter of fiscal 2024 demonstrates the challenges faced due to foreign exchange fluctuations. However, the company remains committed to strengthening its position and managing risk as it continues to navigate these uncertain times.