Sonatel (SNTS) Q4 2023 earnings summary

Executive summary

• FY2023 consolidated revenue rose 11.4% to FCFA1,620.7bn; net income increased 19% to FCFA331.7bn, meeting targets amid tougher competition and challenging socioeconomic conditions.

• Customer growth and investment supported leadership across five markets; total fixed, mobile and internet customers reached 41.1m, up 5.9% YoY.

• Revenue growth was driven by retail demand, especially mobile data, Orange Money and fixed broadband, alongside continued expansion of mobile and high-speed networks.

Financial highlights

• Revenue was FCFA1,620.7bn, up 11.4% YoY; retail revenue grew 12.5% to FCFA1,512.8bn and represented 93.3% of the total.

• Net income reached FCFA331.7bn, up 19.0%; operating income was FCFA515.7bn versus FCFA437.1bn in 2022, and basic EPS was FCFA2,794.

• EBITDAAL rose 18.4% to FCFA747.5bn, with a 46.1% margin, up 2.7 percentage points; operating cash flow increased 33.8% to FCFA493.9bn.

• eCapex was FCFA253.5bn, down 3.4% YoY and equal to 15.6% of revenue; reported cash flow statement acquisitions of property and intangible assets totaled FCFA288.1bn.

• Data revenue grew 20.4% to FCFA535.3bn; Orange Money revenue rose 25% to FCFA164.9bn and broadband revenue increased 21.2% to FCFA85.9bn.

Outlook and guidance

• 2024 priorities include human-capital development, better customer experience and service quality, operating efficiency, new growth models, and a more innovative multiservices strategy.

• Growth focus remains fixed fiber and mobile broadband, including 4G and 5G, enterprise services, and mobile money supported by AI, digital tools and the Maxit super-app.

• Maxit was used by more than 3m people in Senegal and Mali at end-2023, with rollout planned in other markets before end-H1 2024.

• Wholesale initiatives planned for 2024 are intended to create new revenue streams to offset pressure from fraud and OTT activity.