• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home Business

Ethiopia Currency Drop Distances Safaricom’s Break-Even Target

12 months ago
in Business, Economy, Features, highlights, Home, home-news, latest News
1 min read
0 0
0
81
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

Ethiopia Currency Drop Distances Safaricom’s Break-Even Target

East Africa’s biggest company by market value may take longer to break even in Ethiopia after the Horn of Africa nation allowed its currency to trade freely for the first time in five decades, causing it to plunge.

The birr has depreciated more than 44% against the dollar since the devaluation at the end of July, which will inflate debt-servicing costs for Safaricom Plc’s local unit, while also raising local-currency expenses such as leases.

The Kenya-based telecommunications operator started operations in neighboring Ethiopia almost two years ago, enticed by a population of about 126 million people and a wireless industry monopolized by a state-owned operator.

Safaricom Telecommunications Ethiopia Plc, or STE, had anticipated breaking even within four years, but it may have to to push out that target as the devaluation eats into disposable incomes, according to some analysts.

“A depreciation would likely prolong the break-even period,” said Michael Odundo, an investment analyst CIC Asset Managers, Kenya’s biggest money-market fund company. “It’s a negative for them because they entered the investment when the birr was much stronger at around 50.”

The birr traded at 107.12 at 5 p.m. Wednesday in the capital, Addis Ababa, about double the official going rate before the liberalization.

RelatedPosts

Government Orders Flags at Half-Mast as Nation Mourns Defence and Environment Ministers in Helicopter Crash

Defence Minister and Environment Minister Among 8 Confirmed Dead in Military Helicopter Crash

Serie A Players Face 25% Pay Cut if Relegated Under New Agreement

Inflation in Ethiopia may average 30% this fiscal year, according to the International Monetary Fund, hurting consumers and STE’s acquisition of subscribers because of higher costs for goods and services.

“There’ll be some impact on their performance when they translate their interest rate on the investment they have made in US dollars,” Odundo said.

STE has taken financing, including a $350 million International Finance Corp. loan in May and a further $137 million from a group of banks. The company also plans to issue local currency-denominated bonds in Ethiopia in September.

Capital-expenditure needs will remain elevated until 2026, when they could show a “sharp deceleration,” according to Ronny Chokaa, a senior research analyst at Nairobi-based AIB Axys Africa.

STE is also going up against Ethio Telecom, which was a monopoly until its entry. The Safaricom unit plans to add 10 million users by the end of March. That compares with its rival’s 78.3 million subscribers.

Competition will “serve to prolong the break-even projections, which were more than optimistic,” Chokaa said.

Source: bloomberg
Via: norvanreports
Tags: Ethiopia CurrencyEthiopia Currency Drop Distances Safaricom’s Break-Even TargetSafaricom

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

No Result
View All Result

Highlights

Osaka and Keys Advance to Quarter-Finals at Canadian Open

Ghana Armed Forces Helicopter Crashes in Adansi Akrofuom, 8 Feared Dead 

Cedi Appreciation Triggers 50% Drop in Remittance Inflows

Inflation Drops 160 basis points to 12.1% in July, Lowest Rate Since October 2021

Kwaku Azar Writes: Is Another SML Brewing at GACL?

GRA Refutes NIA’s Debt Claims, Cites Lack of Regulatory Approval and Service Agreement

Trending

Features

Government Orders Flags at Half-Mast as Nation Mourns Defence and Environment Ministers in Helicopter Crash

August 6, 2025

Government Orders Flags at Half-Mast as Nation Mourns Defence and Environment Ministers in Helicopter Crash Ghana has...

Defence Minister and Environment Minister Among 8 Confirmed Dead in Military Helicopter Crash

August 6, 2025

Serie A Players Face 25% Pay Cut if Relegated Under New Agreement

August 6, 2025

Osaka and Keys Advance to Quarter-Finals at Canadian Open

August 6, 2025

Ghana Armed Forces Helicopter Crashes in Adansi Akrofuom, 8 Feared Dead 

August 6, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.