MTN Earnings Rise as More Data and Mobile Money Customers Sign Up
MTN, Africa and the Middle East biggest mobile phone operator, swung back into profit for the six months to end-June, as it signs up more data and mobile money service customers.
In a competitive Africa and Middle East market where regulatory uncertainty increases every day, MTN has reported a 217 cents headline earnings per share (HEPS) versus a 271 cents headline loss in the same period last year, hit by the Nigerian regulatory fine of 474 cents.
HEPS is the main profit gauge in South Africa.
The group also added 2.7 million active mobile money customers in the period, pushing its total users to 17.9 million.
These include 11.3 percent increase to 4,6 million mobile money users in Uganda and Ghana subscribers jumped by 9,5% to 6,2 million. The Nigerian operation reported a 22,9% rise to 1,9 million mobile money service customers, while Cameroon customers doubled to 730 776 and in Ivory Coast rose 8,2% to 1,3 million.
MTN also saw data users grew by 9.1% to 122.7 million users.
“We are seeing pleasing progress in our key growth drivers of data and digital services against headwinds of challenging macro-economic conditions and foreign exchange currency pressure,” said MTN CEO, Rob Shuter.
“We continue to strengthen our focus on operational excellence with our six strategic pillars integrated in our new BRIGHT strategy. Our focus during the second half of the year will be to entrench our BRIGHT strategy, complete our network investment programme and build medium-term financial KPIs and targets for the BRIGHT strategy.”
The mobile phone operator saw data revenue rose 31,9%* to R13.9 billion, supported by the improved quality and capacity of its data networks in key markets. The South African operation data revenue increased by 18,5%, in Nigeria by 70,4% and Iran by 67,7%.
MTN Irancell delivered a solid performance despite pressure on data pricing. The operation increased subscribers by 3 to 49 million, supported by attractive data bundles. Total revenue increased by 17,2%, driven by increased data revenue. Data revenue was supported by growth in data bundles, modernisation of 2G and 3G sites and expansion of the 4G network.
While, MTN data revenue increased by 70,4%, benefiting from customised data offerings and improved network quality driving data usage.
The group also a 6.7% rise in revenue R64 billion, benefitting from encouraging revenue growth in Nigeria, Uganda, Ghana, and Ivory Coast. The company attributed this to strong data and digital revenue growth in these markets.
MTN’s digital revenue rose 24.7% to R6.5 billion, driven mainly by mobile financial services.
However, MTN’s cash inflows from operations dropped to R17.7 billion due to lower attributable profits in Nigeria.
The company said the repatriation of cash from MTN Irancell of R6.5 billion supported cash flows for the period.
MTN’s capital expenditure was slower than expected in the first half by limited foreign currency availability in Nigeria, some execution challenges as well as the seasonality of the capex cycle.
The company’s capital expenditure dropped by 25,2% to R10.3 billion.