The MTN Group has reported a decline in revenue largely due to challenges in Nigeria and Sudan, with a 15.4% drop in service revenue. Despite this, subscriber numbers and fintech services grew, and the company is taking strategic measures to improve its financial stability. Expectations for dividends remain optimistic for the coming year.
The MTN Group has reported a notable decline in revenue, attributing this downturn primarily to challenges faced in Nigeria and Sudan. As Africa’s largest mobile operator by subscriber count, MTN disclosed its annual financial results for the fiscal year ending on December 31. The results reflected adverse impacts from the devaluation of the Nigerian naira and ongoing conflicts in Sudan.
Overall group service revenue decreased by 15.4% to R177.8 billion, though it showed a constant currency increase of 13.8%, with a 14.4% rise when excluding Sudan. Despite revenue growth in some areas, data revenue decreased by 12.3% on a reported basis. However, it rose by 21.9% when assessed in constant currency, while fintech revenue displayed an 11% increase.
The company’s EBITDA experienced a 33.5% decline, with an 8.9 percentage point drop in the EBITDA margin. Moreover, basic earnings per share fell significantly to a loss of -531 cents, while reported headline earnings per share decreased by 68.9%, reaching 98 cents. Notably, MTN witnessed a revenue decline of 20.8% in the first half of 2024, amounting to R85.3 billion compared to R107.7 billion in the first half of 2023.
On a positive note, total subscribers increased by 2.2% to reach 290.9 million, alongside a 7.7% uptick in active data subscribers, totaling 157.8 million. Mobile Money (MoMo) saw a modest rise of 0.9% in monthly active users, reaching 63.1 million, while data traffic surged by 32.6%. The telco also reported a 15.3% growth in fintech transaction volumes, totaling 20.3 billion.
MTN Group CEO Ralph Mupita expressed satisfaction with the performance amidst operational hurdles, stating that the stability of key macro-economic indicators provided support for the company’s results. He emphasized that the financial outcomes were bolstered by tariff amendments approved in Nigeria and the successful execution of many strategic priorities.
Mupita acknowledged significant challenges stemming from currency devaluation and inflation while noting the geopolitical volatility, particularly the conflict in Sudan which adversely impacted operations there. MTN invested R29.9 billion (excluding leases) to enhance network quality and capacity, contributing to the structural demand for data and fintech services.
In terms of growth, MTN concluded FY 2024 with 291 million subscribers, marking net additions of 6.2 million customers. Active data subscribers grew by 7.7%, while MoMo MAU increased by 0.9%. The slowing growth in MoMo MAU was attributed to quality improvement initiatives implemented in fintech markets.
Looking ahead, MTN worked on portfolio optimization, successfully finalizing the sale of MTN Afghanistan and the exit from the consolidated Middle East operations. Sales in MTN Guinea-Bissau and MTN Guinea-Conakry were also completed to enhance focus and risk profile. Additionally, the company renegotiated tower lease contracts in Nigeria to ensure more sustainable terms, leading to R1.3 billion in operational savings.
MTN has declared a dividend per share of 345 cents for FY 2024, with expectations for a minimum ordinary dividend of 370 cents in FY 2025 after the full-year results are announced in March 2026.
The MTN Group is navigating significant challenges that have led to a decline in its revenue due to currencies’ devaluation and geopolitical conflicts. Despite this, the company continues to see growth in its subscriber base and fintech services. Strategic initiatives, including portfolio optimization and renegotiated contracts, position MTN for improved future performance. The firm remains committed to sustaining operational momentum even in difficult markets.
Original Source: www.itweb.co.za
