MTN Group recorded improved topline performance in the year ended December, driven by a surge in active data and Mobile Money (MoMo) subscriptions, despite turbulent market conditions ushered in by the COVID-19 pandemic.

The telco, which has been seeking to reposition itself and push into new sources of revenue, recorded increased uptake of its fintech business, which includes MoMo, insurance, airtime lending and e-commerce.

The Pan-Africa mobile operator says driven by its focus on furthering digital and financial inclusion, it added 19 million active data users and 11.7 million MoMo users, to reach 114.3 million and 46.4 million respectively.

In addition, MTN, which presented its financial results today, says the number of active merchants accepting its MoMo propositions increased 115% to 440 000.

In Nigeria, MTN signed up more than 280 000 additional agents, to end the financial year with more than 395 000 registered agents for its fintech business.

Golden goose

In the year 2020, MTN’s data revenue expanded by 31%, with a 110% increase in traffic brought about by higher levels of online demand resulting from the effects of COVID-19, including an increase in learn-from-home and work-from-home.

MTN says it surpassed the breakthrough 100 million mark in the first half of the year as it continued to work towards its ambition of connecting 200 million data users to its networks in the medium-term.

“Anchored in our intent of driving the industry-leading connectivity operations in our markets, we sustained our efforts to bridge the digital divide,” says MTN.

“We expanded our 3G and 4G coverage footprint, adding 16.3 million and 55 million people respectively; invested in 5G in SA; recorded 140 million smartphones on our network; and reduced the effective rate per megabyte by 32.9%. Average data usage rose by 60% to 4.4GB per month.”

Turning to fintech, MTN says revenue rose by 23.9% and the value of MoMo transactions was $152 billion and the mobile operator processed 12 400 transactions per minute (up 35% from 9 200 in 2019).

“While COVID-19 accelerated the adoption of mobile financial services, growth in fintech revenue was moderated by reductions in transaction fees to support our customers, lockdown restrictions on agents and a slowdown in economic activity.”

At the end of December 2020, MTN’s aYo insurance joint venture had 11 million registered policy-holders and six million active policies. In total, aYo generated $6.4 million (R106 million) in service revenue and $10.5 million (R172 million) premium income.

Turbulent times

CEO Ralph Mupita says despite the challenging trading conditions, MTN continued to demonstrate strong operational execution and resilience in delivering a solid performance for the year in its key commercial and financial metrics.

In the year, MTN added 28.8 million customers to its networks, to end with a subscriber base of 279.6 million, as at December 2020.

“We continued to perform favourably against our medium-term targets, with service revenue growth of 11.9% and EBITDA growth of 13.4%, maintaining our strong operating leverage,” says Mupita.

“The solid operational result was supported by the pleasing growth in our larger operations as well as a broad-based improvement across all our regions. In the larger operations, MTN South Africa sustained the turnaround in its core business units, while MTN Nigeria and MTN Ghana continued to deliver solid overall performances with double-digit service revenue growth in both markets.”

Mupita says 2020 was characterised by the COVID-19 pandemic and its impacts, including volatility in global commodities and capital markets, as well as the implementation of varying degrees of restrictions. These, he says, were most severe in April 2020, after which they began to ease.

“The pandemic has brought about unprecedented socio- and macro-economic challenges globally that have impacted lives and livelihoods across our footprint. The health and safety of our people across our markets has been our key priority.

“To the end of February 2021, we have reported 1 404 COVID-19 infections and mourned the loss of 10 MTN employees across our markets. We continue to apply health measures to safeguard the wellbeing of our people, who have also been empowered to work remotely.”

MTN also made a $25 million donation in support of the African Union’s programme to secure much-needed COVID-19 vaccines for member states.

“This partnership deepens MTN’s role in the ongoing work to save lives in the markets in which we operate. Importantly, it aligns with our ambition to create shared value and ensure the continent’s future progress and prosperity.”