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MTN Ghana’s 2023 tax bill hits $469m

By , Africa editor
Ghana , 29 Feb 2024
Selorm Adadevoh, CEO, MTN Ghana.
Selorm Adadevoh, CEO, MTN Ghana.

MTN Ghana paid $469 million (GHS5.9bn) in direct and indirect taxes and $32 million (GHS0.4bn) in fees, levies, and other payments to governmental agencies, combined, for the 2023 financial year.

MTN Ghana, yesterday, declared consolidated financial information to shareholders, for the year ended 31 December 2023. The combined $501 million paid in taxes and other government levies represented 47.1% of the telco’s total revenue, it revealed.

MTN Ghana CEO, Selorm Adadevoh reaffirmed the telco’s commitment as a development partner to the government, through its tax contribution, as well as other fiscal and socio-economic development benefits that it brings to the country.

Adadevoh said that the MTN Ghana Foundation invested $2.4 million (GHS30.3 million) in 2023 to improve healthcare, education, and economic growth. Among the projects were a 60-bed maternity and neonatal centre for the Keta Municipal Hospital and a STEM robotics lab for the Mamfe Girls’ School.

MTN Ghana, in collaboration with the government, launched the Ghana Innovation Hub project, aligned to the company’s Ambition 2025 objective of delivering digital solutions for Ghana’s progress. MTN made a commitment of $25 million towards the hub.

In terms of financial results, MTN Ghana delivered service revenue growth of 34.6% year-on-year (YoY). Adadevoh said this was supported by: “its continued core capital expenditure (ex-leases) of $262 million (GHS3.3bn) in the year and successful execution of well-crafted commercial strategies.”

In the year, mobile subscribers reached 26.8 million as a result of the national SIM re-registration exercise, representing a 6.3% YoY decline.

Active data subscribers increased by 14% to 15.4 million, while active Mobile Money (MoMo) users increased by 20.1% to 15.2 million.

Earnings before interest, tax, depreciation, and amortization (EBITDA) increased by 40.2% to $620 million (GHS7.8bn) and EBITDA margin increased by 2.3 percentage points (pp) to 58.4%.

MTN Ghana’s voice revenue recorded a 9% YoY growth to $286 million (GHS3.6bn) supported by the telco’s customer value management initiatives, which offers bundles and packages that meet the diverse needs of customers, said Adadevoh.

He said: “Our commitment to improving our network coverage and the quality of service, along with pricing initiatives, have been instrumental in the growth of voice. The contribution of voice to total service revenue declined from 33.1% to 26.8%, as customer behaviour evolves in line with global trends.”

In the period, data revenue grew by 50.9% YoY to $461 million (GHS5.8 billion), driven by a 19.3% YoY increase in data consumed per active user and implementation of data pricing initiatives.

“Our focus on developing relevant and well-positioned data packages also contributed to the growth in data revenue. The data revenue contribution to total service revenue increased from 39.2% to 43.9% YoY,” he said.

On MoMo, revenue growth recovered, with a strong YoY increase of 48.8% to $230 million (GHS2.9bn).

Adadevoh said: “Our partnerships with various financial institutions, agents, and merchants have enabled us to expand the mobile money ecosystem, making it easier for our customers to transfer money to others, make payments through merchants, save, and access micro-loans, micro-insurance, and international remittance services.

“This helped increase the contribution of advanced services to MoMo revenue by 3.0pp to 24.8% over the previous year’s contribution of 21.8%. The overall contribution of MoMo revenue to total service revenue increased from 19.6% to 21.7% YoY.”

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