🎧 Capital Markets Africa Weekly News Roundup, 10th November 2023

Welcome to the Capital Markets Africa weekly news roundup. Your source for the latest happenings across the listed African equities space.

We kick things off in Kenya where Safaricom Group, the telecoms giant, has just announced its half year results. Service revenue rose 9.9% to just under KES160 billion, about US$1 billion. This growth was largely driven by a 16.5% increase in revenue from M-PESA, Safaricom's world-leading mobile money product.

In May 2021, the company was granted a licence to operate in neighbouring Ethiopia, one of Africa's largest markets. In that market, Safaricom is going head-to-head with state-owned incumbent Ethio Telecom which boasts a customer base of 71 million.

Net income for Safaricom's Kenyan business was up 10.9% while at group level, net income was lower but still positive at 2.1%.

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To Zambia where National Breweries Plc, a listed brewing business, has reported its half-year earnings.

Although overall revenue was up 150%, the company recorded a pre-tax loss of minus 59%. The company blames the sharp increase in the cost of maize, a key input into the production process, as well as FX challenges. The Zambian kwacha has declined 20% against the US dollar so far this year.

For a few years now, National Breweries has struggled to turn a profit. When its main rival Zambian Breweries reported its half-year earnings back in August, revenues for that business were up 12%. It also recorded a 265% increase in pre-tax profit for the same time period.

National Breweries is known for its famous Chibuku product, a traditional African beer made from sorghum while Zambian Breweries makes clear, premium lagers like Mosi and Castle Lite. 

Look out for further analysis into both companies later on next week.

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To Zimbabwe where Simbisa Brands, the country's largest fast food restaurant operator, has announced its full-year results.

Gross revenue hit US$287 million, a rise of 23%, while EBITDA was also up 9%. This growth was driven primarily by its Zimbabwean operations where customer numbers were up 24% compared to an average of 2.5% in Simbisa's other markets which include Kenya, Zambia, Mauritius, and Ghana.

The group owns brands like Chicken Inn and Pizza Inn. It also holds the franchise for Nandos Zimbabwe.

Last year, Simbisa moved from the main Zimbabwe Stock Exchange to the US-dollar dominated Victoria Falls Stock Exchange where its share price is down just under 4% for the year to date. Simbisa has a price-earnings ratio of about 10x.

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And finally to Uganda where Airtel Uganda, the country's second largest telecoms company, has finally listed 20% of its business on the Uganda Securities Exchange.

The IPO encountered several challenges. It was severely undersubscribed by investors with a 54.45% subscription rate, and it had to sell stakes to institutional investors at a heavy discount.

Uganda's last IPO was in 2021. Back then, MTN Uganda also listed 20% of its business in an IPO was also severely undersubscribed. Back then the subscription rate was 64%.

Bharti Airtel has other African listed subsidiaries in countries like Nigeria and Zambia.

Join us again next Friday on the Capital Markets Africa Weekly News Roundup!

© Capital Markets Africa, 2023

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