Airtel Africa Plc

Welcome to the Airtel Africa half-year results for the period ended 3rd of September 2026. Please note that the call will be recorded. During today's call, webcast participants will be in a listen-only mode while we conduct the question and answer session. If you wish to ask a question, we ask that you please press star 5 on your telephone keypad to join the queue. Alternatively, if you are participating on the webcast, you can submit your question through the Q&A tab. Further instructions will follow at the time of Q&A. I would now like to turn the call over to Sunil Taldar. Please go ahead.

Thank you. Hello, everyone, and thank you all for joining us today. I have with me Kamal Dua, our CFO, and Alastair, our head of investor relations. Let me give you some brief highlights over the first half of this year, and we'll let Kamal run through the key financials before I spend time giving high level perspective around our markets. The last six months have been very encouraging with a continuous focus on our strategy, enabling us to capture the significant opportunity across our markets. Despite ongoing geopolitical developments, the macroeconomic and currency environment remained relatively stable, the demand in both the telecoms and financial services remaining intact, translating into a strong top-line growth with constant currency revenue growth of almost 21%. The geopolitical developments, however, have impacted inflationary pressure on our cost space with fuel prices rising significantly over the last six months. These developments renewed our focus on initiatives to drive cost efficiencies to limit the impact, and I'm very pleased to see EBITDA margins remain above 50% over the period. As we highlighted earlier in the year, we also accelerated our CAPEX plans to position us for the Ability to capture the significant growth opportunity and these results reflects how this accelerated capex is supporting our business growth. Our strong cash generation and balance sheet provide us with significant flexibility. They allow us to continue investing in growth, maintain disciplined capital allocation, and deliver sustainable long-term value for shareholders. Finally, the period also marked the landmark milestone with the successful IPO of Airtel Money. The listing opens an exciting new chapter for the business, providing a strong platform to capture the significant growth opportunity in digital financial services across Africa. Following the IPO process, we have maintained our shareholding of around 78% and we remain exposed to Airtel Money's continued growth and value creation. This slide brings together how the strategy is translating into tangible operational and financial outcomes. First, reflecting our strategic focus on the customer experience, we've continued to deepen our customer engagement. Our customer base grew by 11.6% to 194 million. And as digital adoption continues to gain traction, we now have more than 100 million smartphones on our network. Furthermore, mobile money customers grew by 22.4% to more than 60 million as financial inclusion continues to gather momentum across our footprint. Importantly, this is not simply a strategy of acquiring new customers. We've also taken specific steps to facilitate increased engagement with the wide array of services we provide. These initiatives underpin 18.9% constant currency growth in mobile services with data up 28%. In addition, mobile money revenues increased 25.8%, demonstrating the strength of demand for accessible digital financial services. A key point to note is that growth is profitable. EBITDA margins expanded 172 basis points to 50.3%, notwithstanding higher fuel costs. In Kodadu specifically, having absorbed the full inflationary pressure of fuel prices, our EBITDA margins increased to an all-time high of 50.4%. Finally, profitable growth enables continued investment and shareholder returns. We invested 657 million during the half and we accelerated spend to drive increased capacity and coverage while also investing in new services such as home broadband and data centers. During the period, we continued our buyback and both declared another 9.2% growth in our interim dividend. Together these outcomes demonstrate the strength of our operating model and our ability to balance investment, financial resilience, and shareholder value. Let me now spend a few minutes talking about each of the business segments and regional performance. Firstly, let's start by looking at mobile services, which continue to report very strong trends Ultimately, the key driver of the results is the continued base growth with customers growing almost 12% and data customers increasing by 15%. Within the mix, smartphone penetration increased to 51.6% as we continue to see the durability of demand for data services. As customers migrate to smartphones, we see a step up in data consumption as they increasingly engage with video, social media, and other digital services. This has driven the increase in smartphone usage to over 13 GB per month when combined with our focus on a more for more approach to pricing has translated into a 10.7% growth in ARPU and 28% increase in data revenues. Together with continued growth in voice revenues, total revenues of our mobile services business increased 18.9% in constant currency. This illustrates the strength of our business model. We are expanding the customer base, enabling more customers to access smartphones, supporting greater usage through network investments, and monetizing that demand. The mobile money business continues to further amplify a strong operating and financial performance. The opportunity, the distribution reach, and a scalable customer-centric platform gives us the ability to continue attracting New customers to the business, continued expansion and enhancement of the different services available on mobile money platform, AB supported by deep rooted partnerships can unlock new growth opportunities and drive the business to new levels. This combined with continued innovation and the rollout of digital offerings has seen continued growth in the customer base and a further 37% growth in TPV with annualized TPV in quarter two of $275 billion. The result has been a strong 25.8% growth in revenues which once again reflects the scale of the opportunity across our markets. We have continued to see strong operating momentum in Nigeria with accelerating customer growth to 15.1% and our pools rising 12.7% as we continue to focus on monetizing the substantial demand across the country. In constant currency, revenues increased 27%, reflecting these strong operating trends, but also reflects the accelerated CapEx deployment as we continue to capture a larger share of the opportunity across the country. EBITDA margins continue to increase on a year-over-year basis, despite the truthful increase in fuel costs over the year. This reflects the enhanced focus on cost efficiencies while operating leverage arising from the strong top-line development Developments provides another source of margin support. In East Africa, our largest region, trends remain strong with constant currency revenue growth of over 18% despite the high base. In the last quarter, we have seen constant currency revenue growth accelerate to 18.6% as we continue to tap into the huge potential across the markets. Mobile money remains key component of this performance and we remain encouraged by the scale of growth and customer take-up of financial services. Once again, the strong subscriber growth and increased usage of our services, which has driven an increase in ARPUs, has been foundation of this strong growth with EBITDA margins rising to 53.6% in the first six months. The performance in the Francophone region has also been very strong. despite the tougher comparables. The turnaround in the performance over the last few years in the Franco region has been driven by a focus on driving base level growth and a relentless focus on our strategy to unlock the opportunity. This turnaround has been across both the mobile services and mobile money business, but a particular shout out to the mobile money business that continues to grow at over 40% in constant currency. In constant currency, We saw revenue growth for the region of over 19% while in Q2 we saw growth in excess of 20% which is a key milestone and has helped EBITDA growth of around 19% in Q2 and stable EBITDA margins. Let me now hand over the call to Kamal to run through the financials in a bit more detail.

Thank you, Sunil. Good morning and good afternoon to all of you. Let me start with the key financial highlights. This slide provides a clear summary of the group's very strong performance in the first half of the financial year. We are pleased to report continued revenue and EBITDA growth of more than 20% in cost and currency, together with EBITDA margin expansion of over 1%. This was achieved despite elevated fuel costs arising from the geopolitical factors. The resilience of our margin reflects the benefit of scale, strong underlying commercial momentum, and our continued focus on operational efficiency. In reported currency, revenue increased by 28.2% to $3.8 billion, while EBITDA grew by almost 33% to $1.92 billion. The strongest growth in reported currency was supported by the currency appreciation, specifically in Nigeria and Zambia. During the period, we deliberately front-loaded the capital investment to strengthen network capacity and position the business to capture the significant growth opportunities across our markets. Despite this higher level of investment, Cash generation remains strong. We sustained healthy free cash flow while maintaining a comfortable lead-adjusted leverage ratio of 0.5 times, highlighting the resilience of our balance sheet and financial position. Three exceptional EPS increased to 11.7 cents from 8.3 cents in the prior year. After adjusting for higher foreign exchange gain recorded last year, underlying EPS rose from 6.9 cents to 11.8 cents, demonstrating the continued strength of our core operating performance. Finally, our strong free cash flow generation and robust capital structure have enabled us to continue delivering shareholders' returns. During the period, we returned almost $110 million through share buybacks. The board has also declared an interim dividend of 3.1 cents per share, an increase of 9.2% over the last year, which is in line with our current dividend policy. Now I'm turning out to revenue. The group maintained strong and broad-based growth momentum, with revenue increasing by 28.8% in constant currency. In reported currency, growth was even stronger at 28.2%, benefiting from the appreciation of Nigerian Naira and Zambian Kwacha. Importantly, this growth was delivered across our three service segments. In constant currency, voice revenue increased by 7.1%, data by 28%, and mobile money by 25.8%. This demonstrates both the continued strength of demand across our markets and the value of our diversified revenue streams. The opportunity across our footprints remain significant. Through disciplined execution and continued investment in network capacity, digital services and customer experience, we are well positioned to sustain this momentum across our region and business segments. Turning on to EBITDA, the strength of our revenue performance together with disciplined cost management delivered 32.8% EBITDA growth in reported currency to $1.92 billion and 23.5% growth in constant currency. We delivered this performance despite significant cost headwinds, particularly elevated fuel price across our markets. Against this backdrop, EBITDA margin expanded by 144 basis points year on year and by a further 35 basis points sequentially. reaching a record 50.4% in Q2. This demonstrates the strength of our operating model, the benefit of scale, and our disciplined approach to cost management. The ongoing macroeconomic condition may continue to influence the margin outlook. However, our focus remains clear to sustain the profitable growth and protect the resilience of our margin. Moving to now the finance cost. The year-on-year movement was largely influenced by significant lower foreign exchange and derivative gains if we compare this with the prior period. Adjusting for these effects and one of exceptional items, the increase was primarily driven by $47 million of additional lease liability interest, reflecting our continued network investment and addition of approximately 2,200 sites during the period. Encouragingly, our funding strategy continues to deliver benefits. with our cost of debt declining by around 230 basis point year on year, supported by active debt portfolio management and lower interest rate across several of our markets. Coming to our equity, before exceptional item was up over 41% to 11.7 US cents in current period as compared to 8.3 cents in the prior period. Excluding the foreign exchange gains in both periods, The underlying EPS grew from 6.9 US cents to 11.8 US cents, driven by strong operational performance across the business. Moving now to the normalized free cash flow. This slide presents the bridge between EBITDA to normalized free cash flow for the first half of the year. The business generated free cash flow of $280 million compared with $368 million in the prior period. despite a $357 million increase in capex payout. Our capex payout in the current year was $713 million which includes payment for 900 band license renewal in Nigeria and 5G spectrum acquisition in Kenya compared with $356 million spent in the prior period. In addition to capex, the major cash outflow included income tax payment of $317 million cash interest of $430 billion and other payment related to lease obligation and dividend paid to our minority shareholders. Now this slide explains why we are confident in stepping up investment across the business. As you can see on the left, the incremental constant currency revenue generated over the last 12 months has continued to increase as the business has scaled, reaching approximately at $1.3 billion. This demonstrates our ability to constantly and consistently translate investment into meaningful revenue growth across an increasingly larger business. Against this backdrop, we have significantly increased capital investment with capex rising to $657 million from $318 million in the prior period. This reflects our confidence in the opportunity ahead, supported by strong execution, sustained demand, and attractive return on invested capital. The majority of this investment remain focused on strengthening our core network through expanded coverage, additional capacity, fiber deployment and 5G rollouts. At the same time, as we have reiterated earlier, we continue to invest in emerging growth opportunities, including home broadband and data centers. Now, this is not simply about investing more capital. It is about allocating capital to areas where we see proven demand, attractive return and significant long term growth potential. The continuous growth in incremental revenue gives us confidence that we are investing from a position of our strength. Moving to the next slide. Our decision to accelerate investment is also underpinned by the strength of our balance sheet. With more than 95% of our debt in local currency and leverage continues its downward trajectory, our capital structure remains very robust. At around 0.5 times least adjusted leverage, we have significant financial flexibility to invest behind the long-term growth opportunities across our markets, while continuing to deliver attractive returns to the shareholders. It should be emphasized that our capital allocation priority remains unchanged. First, our key priority is always to continue investing in the business, capturing the significant growth opportunities across our market, as I have just outlined. Second, we remain committed to maintain a sustainable and robust capital structure. With leverage at around 0.5 times, we remain very comfortably positioned. And third, we continue to return cash to the shareholders through our progressive dividend policies and share buybacks. We have been very consistent in this approach and this is reflected once again in the board's decision to declare an interim dividend of 3.1 cents per share and increase of 9.2% year on year. So our capital allocation framework remains clear and consistent, which is invest for growth, maintain balance sheet strength and deliver consistent return to the shareholders. With this, let me now hand over back to Sunil, please. Thank you.