MTN Group CEO, Ralph Mupita. Photo: Simphiwe Mbokazi/Independent Newspapers.
MTN Group again passed the interim dividend after it reported a 198.5% slump in headline earnings a share to -256 cents per share in the six months to June 30 due to other African currency devaluations, and the weak macro-economic environment.
CEO Ralph Mupita said, however, that strong operational momentum was maintained and the resilience of the business was reflected in the growth of their ecosystem, with data traffic and fintech volumes up by 35.7% and 18.0%, respectively.
The fintech platform continued to expand, driving good growth in advanced services; while strategic initiatives were initiated, particularly localisations and portfolio optimisation.
“We will continue to execute our Ambition 2025 strategy to drive growth and unlock value for all our stakeholders over the medium term. The board anticipates paying a minimum ordinary final dividend of 330 cents per share for the full 2024 financial year,” he said.
MTN SA’s network resilience plan was expected to support growth against the macroeconomic headwinds, including ongoing pressure on consumer spending. The plan was also driving customer behaviour evolution to optimise the consumption of bundles.
MTN Nigeria would press ahead with the initiatives to restore its profitability and balance sheet profile, particularly in resolving its negative equity position. Tariff increases remained critical to the recovery and sustainability of the industry in Nigeria, Mupita said.
In the group’s markets portfolio, the priority was to sustain strong growth in markets like Ghana, Uganda and Cameroon; while implementing initiatives to turn around the performances in Ivory Coast, Rwanda and Zambia.
In the platform businesses, partnerships to accelerate growth and commercial monetisation would be leveraged in fintech. The business was being scaled through sequential launches of commercial initiatives with Mastercard across various markets in the remainder of the year.
“Good progress was being made in the commercial roll-out of their card issuance, in line with our partnership with Mastercard,” Mupita said.
“We deployed R13.4 billion of capex, reflecting a capex intensity of 14.8%, largely reflecting lower spend by MTN Nigeria, as the company focused on reducing its exposure to US dollar-denominated obligations. We rolled out 1 556 4G and 829 5G sites,” he said.
The financial results for the interim period was impacted by headwinds, the devaluation of the naira in particular. The strength and flexibility of the balance sheet was maintained.
Group service revenue increased 12.1%, but group voice revenue was down 0.4%. Data revenue increased by 21% while fintech revenue was up 27.2%. The number of subscribers was higher by 0.8% to 288 million. The number of active data subscribers increased by 9.2% to 150.2m, according to Mupita.
MTN SA’s service revenue was up 3.3%, and MTN Nigeria’s service revenue increased by 32.4%. Tower lease renegotiations in Nigeria were concluded, and MTN Ghana’s service revenue increased 31.1%. Active MoMo customers increased 9.1% to 66 million.
He said MTN South Africa (MTN SA) completed its network resilience plan. MTN Nigeria delivered a strong reported underlying performance, despite the severe macro impacts on its financial performance.
Key initiatives in the period in MTN Nigeria had included the acceleration of the topline, optimisation of capital expenditure, and reduction of its US dollar-denominated obligations.
On the balance sheet holding company debt increased to R40.3 billion from R31.9bn as at December 31, 2023. Commercial and strategic priorities include R7.8bn of savings targeted over the next three years, maintaining the strong underlying momentum in the key operating company and markets, and the commercial monetisation of platform businesses with the launch of fintech initiatives.
The medium-term guidance to investors was maintained with capital expenditure anticipated to between R28bn to R33bn.
The interim results excluded Afghanistan in the base year following the group’s exit in February, 2024.
During the interim period the subscriber-base growth was impacted negatively due to subscriber registration regulations in markets such as Ghana and Nigeria, with a decline in subscribers in Sudan amid the ongoing conflict and the exit from Afghanistan.
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