Major African operators have reported good results for 3Q20, demonstrating resilience to the COVID-19 pandemic, and the strength of the long-term growth prospects on the continent.
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Several of Africa’s biggest telecoms operators have reported strong results recently, showing that their businesses are holding up well despite the COVID-19 pandemic.
At MTN Group, which is Africa’s biggest telecoms operator, service revenue for 3Q20 was up by 11.4% year-on-year (YoY), and EBITDA was up 13.9%. MTN’s data revenue grew by 31.9%, driven by demand for work-from-home services, digital entertainment, and online education. Fintech revenue and digital revenue grew by 21% and 37.5% respectively.
The operating environment remains challenging and uncertain, but the pandemic has highlighted the importance of connectivity, financial inclusion, and digital services, MTN said in a statement about the results. The operator regards those areas as growth prospects.
“We continue to manage the risks but remain very focused on strong commercial execution around the opportunities that we see,” said MTN Group CEO Ralph Mupita in a conference call. “We are quite well positioned for the acceleration that we see for broadband access and digitalization across our markets.”
Airtel Africa, which operates in 14 markets on the continent, has reported that its revenue for the six months to September 2020 increased by 16.4% YoY. Airtel Africa’s data revenue increased by 33.4%, while mobile money revenue grew 30.4%, and data and mobile money now account for 30% and 10% respectively of the company’s revenue. Voice revenue grew too, by 7%.
“In these unprecedented times the telecoms industry has emerged as a key and essential service in these countries,” said Airtel Africa CEO Raghunath Mandava in a conference call about the company’s results.
Orange said that its revenue for Africa and the Middle East increased by 5.1% in 3Q20—close to pre-pandemic growth rates for the region—and up from growth of 1.3% in 2Q20 when the impact of the pandemic, or at least of its first wave, was at its height. Orange’s MEA operations saw much stronger revenue growth than Orange Group as a whole, which had revenue growth of 0.8% YoY in 3Q20.
Vodacom’s results for 3Q20 were not yet available at the time of writing, but in 2Q20 its service revenue increased by 7.6% YoY, which the company attributed to increased demand for data in South Africa during the tight lockdown that was imposed during the second quarter.
Not all operators in Africa had a positive story, however. Maroc Telecom, which operates in ten markets in West and Central Africa as well as in Morocco, reported a decline in revenue of 3.1% YoY in 3Q20. The decline was largely due to a fall in revenue from roaming and international calling at Maroc Telecom’s home market of Morocco, as tourism and other travel were hit by restrictions relating to the pandemic.
It does not detract from the seriousness of the impact of COVID-19 on Africa, or diminish the possibility that there will be further consequences in the future, to say that Africa has experienced less disruption as a result of the pandemic than most other major world regions.
The pandemic has also highlighted the importance of telecoms infrastructure in Africa, which if anything is accelerating existing trends towards the increased use of data connectivity and digital services.
And these are trends that have a long way to run on the continent, because levels of connectivity are lower than in the rest of the world, while economic and population growth will further expand the size of the addressable market.
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