MTN has underlined the significance of strong performance by its Ghanaian and Nigerian operations, inferring that this has helped the company withstand strong market challenges including subscriber management, NIM/SIM registration, rising inflation, fuel prices as well as supply chain issues.

According to MTN Ghana’s interim results for the six-month period ended 30 June 2022, the company increased its mobile subscribers by 11.6% to 27.8 million, its active data subscribers increased by 15.1% to 13.1 million, as well as active Mobile Money (MoMo) users increased by 11.0% to 11.7 million.

Its service revenue grew by 28.9% to GHS4.7 billion, and it recorded an increase in Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 36.0% to GHS2.7-billion (Normalised EBITDA (excluding the IFRS 2 charge), increased by 38.2% to GHS2.7 billion).

­EBITDA margin up by 3.0 percentage points (pp) to 57.4% (Normalised EBITDA margin (excluding the IFRS 2 charge), expanded by 3.9pp to 58.3%).

­Total capex for the period was GHS1.1 billion.

MTN Ghana stated: “MTN Ghana’s performance in the first half of 2022 was resilient in a challenging macroeconomic environment, characterised by rising inflation, increased fuel cost and pressure on the exchange rate. Inflation reached a 19-year high of 29.8% in June, above the Central Bank’s upper inflation target of 10% for the year. This was exacerbated by a weaker cedi against the US dollar and other major trading currencies in a high import-based economy, increasing fuel prices and disruption to the global supply chain.

To manage these challenges, the Government has implemented several initiatives such as raising the policy rate, activating new revenue sources such as e-levy, introducing spending cuts, pursuing a USD1 billion syndicated loan and seeking intervention from the International Monetary Fund (IMF).”

In the presentation of its results, MTN Ghana acknowledged that its digital revenue declined by 15.8% YoY to GHS81.7-million, and this was due to its continued effort to rationalise its digital portfolio.

“During the period, the number of active digital subscribers decreased by 0.3% YoY to 3.4 million. We will continue to enhance our digital messaging channels and add more value, choice and personalisation to our music and gaming offerings. The contribution of digital to service revenue decreased from 2.7% to 1.8% YoY,” the company added.

The Ministry of Communication and Digitalisation on 31 July 2022, extended the deadline for SIM card re-registration using the Ghana National ID card from 31 July 2022 to 30 September 2022.

“MTN has committed additional resources and adopted various strategies including deployment of field teams into remote locations, self-service registration, announcements on customers’ phones during call initiation, SMS notifications, to name a few, to accelerate re-registration and ensure a speedy completion of the exercise.”

Anticipation building in Nigeria

According to daily online financial news source Ghost Mail Daily, by EasyEquities, “MTN Nigeria (a critical investment in the broader group), EBITDA grew by 22.1% in the six months to June 2022. After all the panic about Nigerian sim cards and subscribers being cut off, the business posted great profit growth. Free cash flow has fallen by over 14% because of the extensive investment in the rollout of the 4G network. This is a good reason for free cash flow to decrease, as MTN generates solid returns from its African businesses…”

ITWeb reported that according to MTN Nigeria’s interim performance, “In the six months to June, MTN Nigeria mobile subscribers increased by 7.6% to 74.1 million, active data users increased by 13.2% to 36.8 million, while active Fintech subscribers rose by 87.3% to 11.5 million. Earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 22.1% to N509.3 billion and the EBITDA margin increased by 0.9 percentage points (pp) to 53.6%. In the period, MTN’s profit before tax grew by 24.9% to N268.6 billion, while profit after tax grew by 28.1% to N181.6 billion.”

The publication quotes MTN Nigeria CEO Karl Toriola as saying, “We are pleased with the progress since the launch (of MoMo Payment Service Bank) and excited about the prospects of our fintech business and driving financial inclusion in the country. As at the end of June 2022, we recorded 4.2 million registered MoMo wallets, of which 2.4 million are active, generating MoMo transaction volume of approximately seven million within six weeks of operations.”