…Grew earnings by 12%, service revenue by 10%
MTN Group on Thursday released its first half
financial report for 2019, where it announced that it recorded additional 7.7
million subscribers to reach a total of 240 million subscribers on its network
across its entire operational base, including Nigeria, as at June this year.
According to the report, despite the difficult
trading conditions across its major markets, the telecoms company, which is
headquartered in Johannesburg, South Africa, was still able to grow its
earnings in the first half of the year, ending June 2019, by 12 per cent and
its service revenue by 10 per cent.
The report added that notwithstanding the
environment, in constant currency terms, service revenue grew by 9.7 per cent
to R67.9 billion, and Earnings Before Interest, Taxation, Depreciation and
Amortisation (EBITDA) expanded by 10.2 per cent to R31.2 billion. The holding
company net debt to EBITDA ratio remained stable at 2.3x, which is well within
the group’s guidance range of 2.0 to 2.5x, while capex intensity dropped further
to 16.9 per cent, which has indicated greater efficiency in deploying assets.
Commenting on the financial results, MTN Group
President and CEO, Rob Shuter, said: “We had a good first half report on solid
financial results; good commercial momentum and encouraging strategic progress.
We saw growth of 12 per cent in adjusted headline earnings per share, which is
the first time that we have delivered growth in this measure in recent years.
“Our service revenue grew just below 10 per cent
and EBITDA just above 10 per cent, both on a constant currency basis. Our
holding company leverage remains stable at 2.3x well within our guidance range
of 2 to 2.5x, and as we grew revenue and carefully managed our investment
programme, we saw capex intensity drop further to 16,9 per cent."
Shuter was quoted in the financial report as
saying: "Commercially, we had strong subscriber growth of 7.7 million in
the first six months of the year to reach a total of 240 million
subscribers. The number of active data
users grew by 3.5 million to 82 million, and our 30-day active Mobile Money
users grew by 2.4 million to 30 million.
“Our continued focus on the customer experience has
seen us record brand Net Promoter Score (NPS) leadership across more than 50
per cent of the portfolio with 12 markets now leading. That contributed to MTN
being named the most valuable South African brand in the Brand Finance South
Africa 50 report, and the most admired African brand by Brand Africa 100.”
Listing its achievements in the first half, the MTN
boss said: "We successfully completed the listing of MTN Nigeria on the
Nigerian Stock Exchange (NSE), and our e-commerce joint venture Jumia listed on
the New York Stock Exchange. Within three months of announcing our asset
realisation programme, which is targeting at least R15 billion over the next
few years, we delivered R2.1 billion in proceeds.
"Our advanced instant messaging platform,
Ayoba, is now live in three of our West African markets, and has more than
300,000 active monthly users. We are very pleased with the formal approval of
our super-agent licence in Nigeria, which clears the way for the launch of
phase 1 of our Nigeria Fintech business while we await a banking licence.”
Shuter said in South Africa, the group contended
with a weak macroeconomic environment as well as the introduction of new
end-user requirements and the re-pricing of out-of-bundle data rates. “In
Nigeria, economic activity was muted in the time of presidential elections and
prior to the formation of the cabinet. In Iran, the Rial weakened sharply after
the re-imposition of the United States sanctions,” he added.
Looking ahead, Shuter said: “MTN is well positioned
to grow by leveraging our scale and enhancing our competitive position. In the
second half, in South Africa, we will focus on the continued turnaround of the
enterprise business, the recovery of prepaid and the launch of Mobile Money. In
Nigeria, we will focus on the further rollout of 4G coverage, the launch of
Ayoba and Music Time as well as accelerating our Fintech ambitions by fully
leveraging our extensive distribution network to offer a range of transfer and
payment services to our GSM customer base."
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