Safaricom Plc · NSEKE:SCOM
Safaricom — Investor Presentation (November 2024)
57 slides from Safaricom's investor presentation, November 2024
Slide 1: Investor Fact Sheet and Presentation from Inception to FY24
INVESTOR FACT SHEET AND PRESENTATION FROM INCEPTION TO FY24
Slide 2: Who We Are
WHO WE ARE Safaricom Plc is a leading Kenyan communications company and a digital innovator providing a wide range of communication services, including mobile voice, messaging, data, financial and converged services with a purpose to Transforming Lives. Our Purpose Our brand promise Transforming Liv
Slide 3: Disclaimer
DISCLAIMER The following presentation is being made only to, and is only directed at, persons to whom such presentations may lawfully be communicated (“relevant persons”). Any person who is not a relevant person should not act or rely on this presentation or its contents. This presentation does not
Slide 4: Our Group Structure
OUR GROUP STRUCTURE Safaricom PLC One Communications Limited Vodafamily Ethiopia 100% 90% Instaconnect Limited 100% Global Partnership East Africa Tower Company 57.41% Limited* 51.67% 100% Safaricom DigiFarm Kenya Telecommunication Limited Ethiopia (STE) PLC 100% 100% Safaricom Money Transfer Safari
Slide 5: Our Purpose Strategy: Embedding Purpose at the Core of Our Business
OUR PURPOSE STRATEGY | EMBEDDING PURPOSE AT THE CORE OF OUR BUSINESS Purpose Transforming lives Vision To be a purpose-led Technology Company To Embed Purpose at the Core of our Business Mission Growth Our people & the Shared Value world around us The Pillars Deploy innovative Future fit talent & te
Slide 6: Our Purpose: Creating Shared Value
OUR PURPOSE | CREATING SHARED VALUE Customers Community • Net Promoter Score (NPS): #1 Benchmark, jNPS (40pts • 1.0Mn+ jobs sustained through our wider economic impact baseline) in FY24, including 262,016 M-PESA agents. • Brand Love: +3pts, Consumer 63% • 3.81 million active users on M-TIBA solution
Slide 7: Purpose: Decarbonising Our Societies Whilst Advancing a Circular Economy
PURPOSE | DECARBONISING OUR SOCIETIES WHILST ADVANCING A CIRCULAR ECONOMY Environment (E) Social (S) Governance (G) 1.5Mn trees grown, targeting 5Mn 3.5Mn lives impacted by the Board Diversity: Male 55%; Female 45% by 2025 Foundations in FY24 Risk management framework is aligned to the Diversity & I
Slide 8: Our Contribution to the UN SDGs: Building a Purpose Driven Brand
OUR CONTRIBUTION TO THE UN SDGS: BUILDING A PURPOSE DRIVEN BRAND ‘We commit to deliver connectivity and innovative products and services (SDG9) that will provide unmatched solutions to meet the needs of Kenyans by enabling access (SDG10) through our technologies and partners (SDG17) and by exploring
Slide 9: Our Social Impact
OUR SOCIAL IMPACT Our two Foundations The strategy for the two Foundations is anchored on our Transforming Lives strategy and our commitment to SDGs 3, 4 and 8. They aim to promote a stable, inclusive society with equal opportunities for all. Moreover, both are governed by a separate and independent
Slide 10: Our Social Impact
OUR SOCIAL IMPACT Education Health Wazesha TVET Programme - Launched on 12 October 2023 in Isiolo County, with Afiya Uzazi Salama - The programme is designed to reduce the maternal, neonatal children’s’ and non-communicable disease goal of improving access to quality, equitable and inclusive skills
Slide 11: Health
Established in 2010, and registered as a trust, the M-PESA Foundation focuses on large-scale, integrated programmes in health, education, economic empowerment. The foundation if funded through M-PESA deposits. Health Uzazi Salama Program - Our KShs 150 million programme for M-Mama - A technology-ena
Slide 12: Education and Environmental Conservation
Education The M-PESA Foundation Academy - Established to provide quality Employability Skills of Visually Impaired Youth -A programme to improve education to bright children from poor backgrounds in all 47 the employability skills of visually-impaired youth through access to counties, with the aim o
Slide 13: Our Social and Financial Innovations
OUR SOCIAL AND FINANCIAL INNOVATIONS Agriculture Clean energy Education DigiFarm: This is an integrated M-Kopa: provides solar home systems that Shupavu 291: A partnership with platform that offers farmers innovatively integrate machine-to- UNESCO and Eneza education, is a convenient, one-stop acces
Slide 14: Our Social and Financial Innovations
OUR SOCIAL AND FINANCIAL INNOVATIONS Lipa Na M-PESA (LNM): Enables merchants to transact using a Financial services till number to collect payments from customers. It has two use- cases: Buy goods - mainly used for one-off payments to Fuliza: This is an overdraft facility in partnership with two M-P
Slide 15: Our Social and Financial Innovations
OUR SOCIAL AND FINANCIAL INNOVATIONS Our customer-centric apps Our innovative enterprise solutions Our home value propositions M-PESA Consumer App – An app that delivers the suite of M- ▪ Fibre-to-the-Home (FTTH) with add-ons like secure-net, smart Kifaru Net – A fast, secure fibre internet connecti
Slide 16: The Journey of Transforming Lives
THE JOURNEY OF TRANSFORMING LIVES 54.5% Market Share 2005 1999 Safaricom was licensed (Officialy Launch of Sambaza (Allows subscribers to share credit) launched in October 2000) Launch of "Please Call Me” Safaricom’s flash back service Vodafone PLC (UK) bought 40% of Telkom Kenya 2006 2000 60.8% Mar
Slide 17: The Journey of Transforming Lives (2010-2019)
65.6% Market share 2016 78.3% Market share • First company in Kenya to link its growth strategy to the 17 UN SDGs • Bob Collymore is appointed CEO Airtel buys Celtel branded as Zain 71.9% Market share 2010 • The Commission assigned additional frequency spectrum resources to • 28 Million subscribers
Slide 18: The Journey of Transforming Lives
THE JOURNEY OF TRANSFORMING LIVES Safaricom’s market leadership sustained through continued innovation and investments including: • Finding sustainable solution for weathering the price war. (2011) • Launch of savings and loans products with CBA. (2012) • Launch of Lipa Na M-PESA. (2013) • Launch of
Slide 19: Strategic Focus
STRATEGIC FOCUS C1 - Public
Slide 20: Our Strategy: FY24 Was the Penultimate Year
OUR STRATEGY | FY24 WAS THE PENULTIMATE YEAR Be Africa's leading purpose-led technology company by 2030
Slide 21: Strategy Execution Highlights
STRATEGY EXECUTION HIGHLIGHTS | STRONG COMMERCIAL & EXECUTION MOMENTUM
Slide 22: Digitizing Kenya: Enabling Ease of Access to Services
DIGITIZING KENYA | WE ARE ENABLING EASE OF ACCESS TO SERVICES
Slide 23: Our Business Model
OUR BUSINESS MODEL Sataricom
Slide 24: Kenya
KENYA C2 - Safaricom Internal
Slide 25: Service Revenue: Evolution of Service Revenue Profiles
SERVICE REVENUE | EVOLUTION OF SERVICE REVENUE PROFILES Service Revenue (KShs Bn) Fixed Data 329.8 331.0 4.8% 12.3% 1.2 KShs 15.9Bn 295.2 +11.8% YoY 250.4 11.7% 281.1 Financial +12.1% FY24 Services 42.4% YoY Connectivity KShs 329.8Bn KShs 139.9Bn Business 52.7% 5.0% +11.7% YoY +19.4% YoY KShs 173.9B
Slide 26: Evolution of Our Business Model
EVOLUTION OF OUR BUSINESS MODEL Messaging Others 7.3% 5.4% Others** 9.7% FTTH 2.0% Fixed Data Our business model shows our sustained investment centered 3.4% Fixed around customer experience and transforming into a M-PESA Enterprise 2.6% M-PESA technology company by powering digital lifestyles. 31.2
Slide 27: Our Innovation: M-PESA
OUR INNOVATION | M-PESA M-PESA | Providing value to customers using new digital solutions, financial services and partnerships is key to unlock Evolution of contribution of M-PESA Revenue to Service Revenue new growth opportunities (KShs Bn) FY23 Performance 139.9 ▪ M-PESA +19.4% YoY to KShs 139.91B
Slide 28: M-PESA Super Apps
M-PESA SUPER APPS | POSITIONING M-PESA AS A LIFESTYLE & BUSINESS PLATFORM OF CHOICE KShs 6.7 Bn >51.2Mn Revenue Transactions via the app, generated value at Kshs via the App 217.9Bn
Slide 29: M-PESA: Developing Scalable Digital Platforms for Key Growth
M-PESA | DEVELOPING SCALABLE DIGITAL PLATFORMS FOR KEY GROWTH 2007 2015 March: M-PESA Launched March: November: 1 Million Customers • M-PESA customers now able to send 2018 2021 2023 Continued… and receive money to and from Tanzania April: Safaricom and Pay fast partner July: Launched Faraja (Buy No
Slide 30: Financial KPIs: Improved Margins
FINANCIAL KPIS | IMPROVED MARGINS, WELL POSITIONED TO CREATE VALUE FY20 FY21 FY22 FY23 FY24 Contribution Margin % 70.8% 68.5% 68.5% 69.9% 72.1% EBITDA Margin % 52.7% 51.0% 50.0% 51.9% 54.7% EBIT Margin % 38.7% 36.5% 36.6% 37.6% 40.9% OPEX Intensity 18.2% 17.5% 18.5% 17.5% 17.4% CAPEX Intensity 13.8%
Slide 31: Ethiopia
ETHIOPIA
Slide 32: Our New Frontier: Why Ethiopia
OUR NEW FRONTIER | WHY ETHIOPIA C2 - Safaricom Internal
Slide 33: Ethiopia Introductory Video
ETHIOPIA | INTRODUCTORY VIDEO Watch Video https://www.youtube.com/watch?v=nu1Ivp_1sfI C2 - Safaricom Internal
Slide 34: Our Shareholders: A Powerful Consortium of Global Partners
OUR SHAREHOLDERS | A POWERFUL CONSORTIUM OF GLOBAL PARTNERS C2 - Safaricom Internal
Slide 35: Evolution of Our Journey in Ethiopia
EVOLUTION OF OUR JOURNEY IN ETHIOPIA 2021 Submitted bid for Telecommunications On 24th May 2021the GPE was •Registered STE PLC and received the Our first data center worth USD 100 license as the Global Partnership for announced as the winning applicant telecom operator license effective 9thJuly Mn a
Slide 36: Our Licenses: GSM and Mobile Financial Services
OUR LICENSES | GSM AND MOBILE FINANCIAL SERVICES C2 - Safaricom Internal
Slide 37: Our Shareholders: A Powerful Consortium of Global Partners
OUR SHAREHOLDERS | A POWERFUL CONSORTIUM OF GLOBAL PARTNERS C2 - Safaricom Internal
Slide 38: Service Revenue: Solid Growth Driven by Mobile Data
SERVICE REVENUE | SOLID GROWTH DRIVEN BY MOBILE DATA Mobile Others* Incoming 6.2% 3.5% Voice 17.7% FY24 Mobile Data 72.6% Service Revenue One-month Active ARPU Mobile Others* 5,380.6 183.1 0.7% Incoming 154.0 11.8% 78.0 1,905.4 Voice FY23 23.9% 507.4 Mobile Data 63.6% FY23 HY24 FY24 FY23 HY24 FY24 *
Slide 39: Ethiopia's Medium Term Big Wins
ETHIOPIA'S MEDIUM TERM BIG WINS | STRONG BUSINESS MOMENTUM FROM AN INTERNATIONAL BRAND C2 - Safaricom Internal
Slide 40: Ethiopia: Medium Term Capex Outlook and Funding
ETHIOPIA | MEDIUM TERM CAPEX OUTLOOK AND FUNDING C2 - Safaricom Internal
Slide 41: Key Numbers
KEY NUMBERS
Slide 42: Key Numbers: Country
KEY NUMBERS | COUNTRY Kenya Ethiopia Population (Million) 56.2 129.7 GDP per capita (USD) 2,003 961 GDP growth 2023 5.6% 7.2% GDP growth estimate 2024 5.5% 57.9% Licence expiry period 2024/2026/2032 2036 Total Customers (Mn) 44.7 4.4 One Month Active ARPU (KSh) 814.79 183.12 Market Position 1 2 Mark
Slide 43: Safaricom Group: Financial Performance for FY24
SAFARICOM GROUP | FINANCIAL PERFORMANCE FOR FY24 FY24 FY23 YoY% Change FY24 Performance • Service revenue grew 13.4% YoY to KShs Service Revenue 335.35 295.18 13.4% 335.35Bn in FY24, supported by M-PESA, Revenue 349.45 309.12 12.4% Mobile Data and Fixed Data growth. EBITDA 163.29 160.35 16.8% • M-PE
Slide 44: Safaricom Group: Six-Year Track Record
SAFARICOM GROUP | FINANCIAL PERFORMANCE FOR SIX-YEAR TRACK RECORD FOR YEARS ENDING 31 MARCH FY24/FY23 (% 5-year CAGR FY24 FY23 FY22 FY21 FY20 FY19 Change) % Service revenue (KShs Bn) 335.35 295.69 281.11 250.35 251.22 239.77 13.4% 6.9% Total Revenue (Kshs Bn) 349.45 310.90 298.08 264.03 262.56 250.2
Slide 45: Our Infrastructure
OUR INFRASTRUCTURE Safaricom’s significant Capital Expenditure which has taken place as technology developed and the Safaricom network expanded have made up a significant portion of the company’s expenditure and, in turn, economic value created. 17,000 Km fibre KShs 93.54Bn A total of 6,591 2G base
Slide 46: Ownership and Stock Price Performance
OWNERSHIP AND STOCK PRICE PERFORMANCE Share Price History as at end of FY Listing IPO 5.00 36.25 34.15 2008 3.60 31.00 26.75 27.55 2009 4.55 26.45 18.10 2010 4.70 19.15 17.75 2011 2.95 16.30 14.05 10.85 2012 5.05 5.00 4.55 4.70 5.05 2013 10.85 3.60 2.95 2014 14.05 Listing 2008 2009 2010 2011 2012 20
Slide 47: Dividends Since Inception
DIVIDENDS SINCE INCEPTION Total Dividends FY Dividend Rate Type to Shareholders Safaricom has consistently disbursed the Run (KShs Bn) largest dividends in Kenya. In FY23/24, 2009 1 0.10 Final 4.01 Safaricom paid an interim dividend 2010 2 0.20 Final 8.01 payment of KShs 0.55 and proposed a 2011 3 0
Slide 48: 2030 Vision: Africa's Leading Purpose-Led Tech-Company
2030 VISION | ANCHORED ON BECOMING AFRICA’S LEADING PURPOSE-LED TECH-COMPANY C2 - Safaricom Internal
Slide 49: Our People and Leaders
OUR PEOPLE AND LEADERS
Slide 50: Our People
OUR PEOPLE Our people are central to our ambition of establishing a Customer Obsessed, digital-first organization and ultimately becoming a purpose-led technology company. In FY20 we made a new brand promise to our customers and partners: “Simple. Transparent. Honest. FOR YOU.” We reviewed our cultu
Slide 51: Our Leaders: Adil Arshed Khawaja
OUR LEADERS ADIL ARSHED KHAWAJA (MGH) Chairman Mr. Khawaja is a highly distinguished Advocate of the High Court of Kenya with over 30 years work experience in the legal profession ranging from dispute resolution to commercial and real estate. He is recognized as a leading name in the Kenyan legal pr
Slide 52: Our Leaders: Peter Ndegwa
OUR LEADERS PETER NDEGWA (CBS) Executive Director and CEO Peter joined Safaricom on April 1st, 2020. He is the CEO of Safaricom PLC, a leading communications company in Africa and pioneer of M-PESA, the world’s most developed mobile payment system. Peter is the first Kenyan to serve as a CEO of Safa
Slide 53: Our Leaders: Dilip Pal
OUR LEADERS DILIP PAL Chief Finance Officer and alternate Director to Peter Ndegwa Dilip, who joined Safaricom as the Chief Finance Officer in November 2020, has more than 30 years of experience in Finance, spanning various industries including Telecoms, Financial Services and Fast- Moving Consumer
Slide 54: Our Leaders: Michael Joseph
OUR LEADERS MICHAEL JOSEPH Chairman - Safaricom Ethiopia Michael is the current Chairman of the Board of Safaricom PLC. He is the former interim Chief Executive Officer of Safaricom PLC, a position held from 2 July 2019 to 31 March 2020. He joined the Board on 8 September 2008. Previously, Michael w
Slide 55: Our Leaders: Wim Vanhelleputte
OUR LEADERS WIM VANHELLEPUTTE Chief Executive Officer – Safaricom Ethiopia Wim Vanhelleputte is the CEO of Safaricom Telecommunications Ethiopia PLC, a purpose-led technology and communication company committed to contributing to Ethiopia’s digital transformation and inclusion objectives. Since taki
Slide 56: Our Leaders: Celebrating Bob Collymore
OUR LEADERS: CELEBRATING BOB BOB COLLYMORE (Former Chief Executive Officer 2010-2019) Celebrating Bob: On July 1st 2019, Bob’s light left us. While it was a sad and difficult time for all of us, we take courage that his dreams of doing business for good lives on in our work, our customers and our vi
Slide 57: Simple * Transparent * Honest FOR YOU
Simple * Transparent * Honest FOR YOU