Airtel Kenya ended the 2016 financial year with a Sh. 45 billion debt load, according to a newly released annual financial report. взять займ онлайн без отказов
The report, published on the Delhi-based parent company’s website, has for the very first time made public the company’s financial welfare – that has left the entity in loss making.
Airtel’s current liabilities of Sh. 55.3 billion in the year to about 2016 December far exceeded its current assets worth Sh. 9.7 billion, indicationg that Kenya’s second largest telecoms operator is technically insolvent. It’s current ratio (used to measure liquidity position) stood at 0.18.
Airtel’s precarious financial position means it would have been unable to meet its financial obligations maturing in 2017, even if it sold all assets that could be readily liquidated.
The heavy debt load heavily eroded the company’s bottomline leaving it with an Sh8.1 billion after tax loss in the year to December 2016.
The outcome was indicative of a normalization in Airtel’s books after the Sh7.1 billion profit after tax it recorded in 2015 on account of a one-off revenue boost from the sale of Kenya towers.
Airtel reported a Sh7.1 billion loss in 2014 and by December 2016, the telecoms operator had accumulated losses worth Sh59.3 billion, according to the financial report.
“These conditions give rise to a material uncertainty, which may cast significant doubt on the company’s ability to continue as a going concern, and therefore that it may be unable to realize its assets and discharge liabilities in the normal course of business,” a note accompanying the statements says.
Airtel’s directors, however, argue in the same report that the company’s survival is hinged on meeting the target subscriber numbers and revenue.
The directors further indicate that plans are afoot to “obtain funding from third parties” and that shareholders have committed to provide funding in order to meet the company’s financial obligations. The report shows that Airtel continues to heavily rely on its shareholders for financing.
Shareholder loans rose from Sh31.4 billion in 2015 to Sh37.6 billion in 2016, accounting for 68 per cent of the company’s total current liabilities.
The operator’s revenue stood at Sh16.92 billion in 2016 from Sh17.73 billion in 2015. However, the 2015 figures were further boosted by “other income” of Sh21.3 billion including a Sh18 billion profit from the sale of Kenya towers.
In 2014, Airtel reported revenue of 15.28 billion. Airtel is Kenya’s second largest telecom operator by subscriber base and the latest financials drive home the significant disparity in performance among telecoms sector companies.
Airtel and Telkom Kenya, the third largest operator, performance pales in comparison with market leader Safaricom, which reported Sh212.9 billion in total revenues and a Sh48.44 billion in profit after tax for the year to March 2017.
Collins Gathogo.