By MTN Group, Africa’s biggest mobile operator, said the decline in value of the Nigeria naira and inflation were its biggest undoing in the West African country.
The African also said that it recorded huge losses in the first half (H1) of 2024 adding that it faced challenges in its Nigerian operations, the mobile operator’s biggest market in Africa.
The mobile operator today announced its interim financial results for the six months to 30 June, revealing that group service revenue decreased by 20.8% while earnings before interest, taxes, depreciation and amortisation (EBITDA) decreased by 41.2%,
According to the Group’s report, the EBITDA margin was lower by 11.6 percentage points) to 32%, while basic earnings per share decreased by 278.6% to 409 cents per share (cps). Reported headline earnings per share (HEPS) decreased by 198.5% to 256cps.
The report showed that it now has has 288 million customers in 18 markets noting, 150 million were active data subscribers – up more than 9% – “who lifted data traffic on MTN’s network by more than a third to 9 054 petabytes”.
MTN Group president and CEO Ralph Mupita is, however, stated he is encouraged by the company’s underlying operational momentum stressing that the H1 results were achieved in a challenging operating environment.
Mupita said the strong underlying performance was masked by the impact of weaker currencies – most particularly the naira against the rand – as well as the ongoing conflict in Sudan.
“MTN delivered a solid underlying performance in H1 2024, with pleasing progress in some key markets. This result, achieved against a challenging macro backdrop, was underpinned by the continued execution of our commercial initiatives and Ambition 2025 strategy.
According to Mupita, in the period, the mobile operator rolled out 1 556 4G and 829 5G sites adding, “Our focus on network quality and competitiveness has underpinned the NPS [net promoter score] position in our consolidated markets.”
He explained that the firm’s subscriber base ended the period at 288 million, with headwinds from subscriber registration regulations in markets such as Ghana and Nigeria, the decline in subscribers in Sudan amid the ongoing conflict and the firm’s exit from Afghanistan.
In terms of momentum, he notes, the underlying growth in the customer base excluding Sudan and Afghanistan was 3.2% year-on-year – 3.1 million net additions in the period.
Active data subscribers were up 9.2% to 150.2 million (up 10% excluding JVs), while Mobile Money (MoMo) monthly active users (excluding over the counter customers) rose by 10.6% to 62.6 million.
At 66 million, the number of active MoMo users was also more than 9% higher, boosting MTN’s fintech transaction volumes by 18% to 9.7 billion in the period, says the firm.
The group’s balance sheet remained strong, with the holding company leverage ratio at 1.6x, and an improved mix of US dollar debt to rand debt at 22:78, well within the target mix of 40:60, it stated.
Added Mupita: “Although the commercial momentum and strategy execution were solid in H1, macro headwinds impacted reported results. The sharp devaluation of the naira over the period had the most significant impact on reported results.
“MTN Nigeria delivered a strong underlying performance, despite the severe macro impacts on its financial performance,” Mupita said.
He noted good progress in key initiatives, including acceleration of revenue, optimisation of capex and the reduction of its US dollar-denominated obligations.
“We will continue on the execution of our Ambition 2025 strategy to drive growth and unlock value for all stakeholders over the medium-term,” said Mupita. “The near-term macro backdrop continues to be challenging across our markets; GDP, inflation and currencies are expected to improve into 2025 across key markets.”
ITweb
