MTN Group reported a 68% drop in earnings per share due to naira devaluation and conflict in Sudan, with service revenue falling 15.4% to R177.8 billion. However, data and fintech revenues showed positive growth in constant currency. Despite challenges, the CEO remains optimistic about macroeconomic stability, with plans for a dividend increase and network investments in the coming year.
MTN Group has experienced a 68% decline in headline earnings per share, falling to 98 cents, which was significantly impacted by the ongoing naira devaluation in Nigeria and the conflict in Sudan. In their annual financial results for the period ending December 31, 2024, MTN reported a 15.4% decrease in group service revenue to R177.8 billion; however, this figure improved by 13.8% when adjusted for constant currency fluctuations.
Among the key highlights from the annual results are notable changes in revenue streams. Data revenue reported a decrease of 12.3%, yet rose by 21.9% in constant currency terms. Fintech revenue displayed more favorable performance, increasing by 11% on a reported basis and rising 28.5% in constant currency. Earnings before interest, tax, depreciation, and amortization (Ebitda) before one-off items fell by 33.5% to R70.1 billion, but increased by 10.2% in constant currency.
The Ebitda margin diminished by 8.9 percentage points to 32% on a reported basis, reflecting a 0.8 percentage point dip to 38.2% in constant currency. Total subscribers accounted for a 2.2% increase, totaling 290.9 million, and active data subscribers rose by 7.7% to 157.8 million, while Mobile Money monthly active users increased slightly to 63.1 million.
MTN Group CEO Ralph Mupita expressed satisfaction with the underlying performance and strategic execution during FY2024, despite challenging market conditions. He noted improved stability in key macroeconomic indicators such as inflation and foreign exchange rates in select markets during the second half of the year.
The group reported a stable balance sheet with a net-debt-to-Ebitda ratio of 0.7x at year-end, up from 0.4x the preceding year, aligning with their established financial targets. The board also declared a final dividend of R3.45 per share, with expectations to increase this to at least R3.70 for the financial year 2025. In line with its medium-term guidance, MTN plans to invest between R30 billion and R35 billion in its networks for the 2025 financial year, dependent on current currency assumptions.
In conclusion, MTN Group’s recent financial results illustrate a significant drop in earnings due to external economic factors, yet indicate resilience in certain revenue streams, particularly in fintech. The company remains optimistic about future stability and growth, committing to substantial investments in infrastructure, while also planning to increase shareholder returns through dividends. Overall, MTN’s strategic focus amidst adversity highlights its intent to maintain long-term sustainability and profitability.
Original Source: techcentral.co.za
