Safaricom has declared an interim dividend of KES 0.55 per share, totaling KES 23.03 billion, for the fiscal year concluding in March 2024.
This marks the second consecutive year in which the telco has decreased its interim dividend; previously, it stood at KES 0.58 per share, equivalent to KES 23.24 billion, in the preceding year.
The decision to reduce the interim dividend comes despite Safaricom reporting a 10.0% increase in core earnings per share to KES 0.9 in H1’2024, up from KES 0.8 in H1’2023.
The company attributes the profit growth to a 9.9% surge in mobile service revenue, rising from KES 138.1 billion in H1’2023 to KES 151.8 billion, with its Ethiopian subsidiary contributing KES 2.0 billion, accounting for 1.3% of the group’s total mobile service revenue.
However, Safaricom encountered challenges in the first half of the year, including heightened competition from rivals, regulatory uncertainties regarding its market dominance, and substantial capital expenditure necessary for its expansion into Ethiopia.
Notably, the Ethiopian subsidiary generated a total revenue of KES 2.9 billion, with service revenue amounting to KES 2.1 billion and operating costs at KES 10.5 billion, resulting in a post-tax loss of KES 14.4 billion, which impacted the group’s overall performance.
The interim dividend will be disbursed to shareholders registered as members as of the market close on March 15 and will be paid on or before March 31.
The Treasury, holding a 35.0% stake in Safaricom, will receive KES 8.06 billion, while Vodacom Group Limited and Vodafone Group Plc, jointly holding 40.0%, will share KES 9.21 billion.
Safaricom’s share price on the Nairobi Securities Exchange has experienced a downward trajectory, depreciating by 42.2% in 2023 and declining by 2.5% year-to-date, from an opening value of KES 13.75 to KES 13.40 as of Wednesday. The telco is anticipated to unveil its full-year results and final dividend in May 2024.
Safaricom Announces Reduced Interim Dividend for Fiscal Year Ending March 2024
