Airtel Africa Welcomes Changes to Nigeria's Foreign Exchange Market

By Anthony O. Goriainoff

Airtel Africa said Tuesday it welcomed the changes to operations in Nigeria's foreign exchange market unveiled by the country's central bank as they are a positive move toward a more stable foreign exchange market.

The London-listed, Africa-focused telecommunications company said that, as a result of the changes, the dollar has appreciated against the Nigerian naira in the investors and exporters market trading segment.

Airtel said that a recent currency-devaluation sensitivity analysis highlighted that a 1% devaluation in the naira would have a negative impact on revenue of $22 million and of $12 million on earnings before interest, taxes, depreciation and amortization.

It added that the dollar component of operating costs within the Nigerian system was minimal and as such it didn't anticipate a material effect on Ebitda margin.

"The market expectation is that the new foreign currency policy and subsequent realignment of the several market exchange rates will provide greater U.S. dollar liquidity and help to alleviate the challenges faced in the last few years to access U.S. dollars in the market," the company said.

Write to Anthony O. Goriainoff at anthony.orunagoriainoff@dowjones.com

(END) Dow Jones Newswires

June 20, 2023 02:38 ET (06:38 GMT)

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