Safaricom’s half-year net profit has fallen for the first time in eight years, Chief Executive Officer (CEO) Peter Ndegwa announced on Monday.
The telecommunication firm said that its net income for the half-year ended September 30, 2020, dropped by 6 percent to Sh33.07 billion with service revenue also contracting by 4.8 percent to Sh118.41 billion.
“Our business has proved to be resilient despite tough operating conditions. There is no doubt that COVID-19 has dealt a huge blow to many people not just in Kenya, but across the globe. This has been a tough period for businesses—small and large alike—and our customers. We are committed to walk through this journey together,” said Ndegwa.
One of the company’s top-performing products, M-Pesa, also recorded a drop in revenue after dipping 14.5 percent to Sh35.89 billion.
However, despite the drop in the performance of some of its products, the company continued to increase its capital expenditure.
“Despite a 4.7 percent drop in Service Revenue, Safaricom increased capital expenditure by 25.5 percent to Sh22.75 billion, signaling investment commitment to building a network infrastructure that supports the country’s economic development,” said Ndegwa.
“Our results reflect the resilience Kenya has shown so far in dealing with the pandemic. While the challenges ahead cannot be understated, we firmly believe that our business is well cushioned to support our customers to rebound stronger and to build back better,” said Joseph.
In one of its efforts to help Kenyans cope with the pandemic, Safaricom dropped charges on M-Pesa transactions for amounts below Sh1,000, giving relief to thousands of Kenyans who use the platform to buy and sell goods and services.