MTN Nigeria will facilitate a process to hike ownership of the firm by more Nigerian retail and institutional investors. File photo: Reuters
MTN Nigeria will facilitate a process to hike ownership of the firm by more Nigerian retail and institutional investors. File photo: Reuters

MTN Nigeria’s subscribers dip by 7.6 million

By Philippa Larkin Time of article published Aug 2, 2021

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MTN Nigeria, in its unaudited results for the half-year ended June, as it celebrates its 20th anniversary, on Friday flagged that its mobile subscribers had declined by 7.6 million to 68.9 million, impacted by the regulatory restrictions on new SIM sales and activations.

Active data users also declined by 52 000 to 32.5 million.

However, voice revenue grew by 13.1 percent, benefiting from an 11.8 percent increase in traffic and its customer value management initiatives. The impact on voice revenue from the industry-wide suspension of new SIM registration was partly offset by higher usage in its active SIM base as well as migration to a higher quality of experience, the firm said.

However, it said following MTN Group’s stated intention to sell down up to 14 percent of its investment in MTN Nigeria, subject to market conditions over the medium-term, MTN Nigeria’s shareholders approved an equity shelf programme at the last annual general meeting.

This would facilitate a process to increase ownership of the company by more Nigerian retail and institutional investors.

It said it had further localised its predominantly Nigerian management team with the appointment of Nigerians to two key senior positions, chief marketing officer and chief information officer previously held by expatriates.

MTN Nigeria chief executive Karl Toriola said, “In the first half of 2021, we made good progress strengthening the resilience of the business, managing the impact of the Covid-19 pandemic and enhancing support to our people, customers and other stakeholders.”

Global Credit Ratings had upgraded MTN’s national scale long-term issuer rating to AAA , which Toriola said was an affirmation of it national scale short-term rating of A1+ with a stable outlook, he said, adding that it provided a solid platform for growth.

MTN Nigeria said during the reporting period its service revenue was up by 24.1 percent to N790.3 billion (R28bn).

Data revenue continued the positive momentum from the second half of 2020, rising by 48.3 percent, driven by increased usage from the existing base.

Shareholders got a dividend per share of N4.55 kobo, up 30 percent in the reporting period.

Capital expenditure was up by 39.1 percent to N186.4 billion, up 50.6 percent to N114.5 billion, as it continued to invest in its network to maintain service quality and aggressively expand its footprint in terms of 4G and rural coverage.

Fintech revenue rose by 48.2 percent, driven by increased adoption of Xtratime, a service that allows you to borrow airtime on credit when you run out of airtime and payback on your next recharge, as well as its core fintech service, while it continued to expand its mobile money service MoMo.

Its digital revenue rose by 61.8 percent, while its active user base rose by 38 percent to more than 3.9 million, led by Ayoba, its instant messaging platform with more than 2.3 million active users.

The enterprise business revenue increased by 6 percent.

Looking ahead, MTN Nigeria said it planned to connect 1 000 rural communities to its network this year with additional 2 000 communities in 2022. In the next three years, it would invest more than N600 billion to expand broadband access across the country in support of the Nigerian government’s broadband plan.

It also said to enable it to continue to take advantage of emerging opportunities, the company had refined its strategy called Ambition 2025 for the next five years.

“We have a clear focus on sustaining double-digit service revenue growth ahead of inflation, driving 4G and rural network expansion, as well as positioning our fintech and digital businesses for accelerated growth in order to unlock their full value,” it said

Parent MTN’s share price on Friday gained 1.3 percent to R105.41.

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