Airtel Africa has responded to the Central Bank of Nigeria’s move to promote a free-floating foreign exchange market, stating that it will help address the difficulties faced in accessing US dollars in recent years.
The telecommunications and mobile money services provider believes that the new foreign currency policy and the subsequent realignment of market exchange rates will increase US dollar liquidity.
Airtel Africa sees the changes in the Nigerian foreign exchange market, including the abolishment of segmentation and the reintroduction of the ‘Willing Buyer, Willing Seller’ model, as positive steps toward a more stable FX market.
The company welcomes the appreciation of the US dollar against the naira in the Investors and Exporters (I&E) window resulting from the Central Bank’s decision.
In their recent financial results, Airtel Africa disclosed a sensitivity analysis regarding currency devaluation, indicating the potential negative impact of a 1% devaluation of the Nigerian naira on their revenues, EBITDA, finance costs, and derivative instruments.
However, the company does not anticipate a significant effect on the EBITDA margin, as the USD component of operating costs in Nigeria is minimal.
Airtel Nigeria, which is Airtel Africa’s largest market, is expected to experience substantial growth due to its underpenetrated market, population growth, and strong demand for digital and financial services.
The company has witnessed consistent performance over the years, with revenue and EBITDA growth in constant currency.
Airtel Africa continues to invest in Nigeria to seize growth opportunities, foster digitalization, contribute to economic progress, and improve lives across the country.
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