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MTN Ghana blocks 4.9m SIMs on regulator’s directive

By , Africa editor
Ghana , 01 Aug 2023
Selorm Adadevoh, CEO, MTN Ghana.
Selorm Adadevoh, CEO, MTN Ghana.

Following the National Communications Authority's (NCA’s) order to block SIM cards not registered with the Ghana Card, MTN Ghana disconnected 4.9 million SIMs in the last six months.

Ghana's major telecoms company today announced 2023 interim results, informing shareholders of a reduction in subscriber numbers as a result of the SIM-blocking order.

MTN stated: "As a result of the disconnection exercise, our subscriber base decreased by 1.6% year-on-year (YOY), to 27.3 million. The full impact of the disconnection exercise on our customer base will be visible 90 days after the disconnection date, with a drop in reported subscribers predicted in the second half (H2) of 2023."

Furthermore, the business noted "the disconnection exercise exempted merchants, agents and persons who demonstrated proof that they are experiencing difficulties with their Ghana card”.

MTN Ghana is the country's largest telecoms carrier, with the highest market share for mobile data (72.16%) and mobile voice (63.06%) subscriptions. The company offers a variety of services, including phone and data, as well as mobile money.

Today, MTN Ghana said it is committed to the nationwide SIM re-registration exercise, and will continue to deploy resources and collaborate with the regulator to ensure SIM re-registration for all users.

In the six months, MTN Ghana's active data subscribers increased by 7.6% to 14.1 million, while active Mobile Money (MoMo) users increased by 21.5% to 14.2 million.

Service revenue increased by 32.3% to GHS6.2 billion, while earnings before interest, taxes, depreciation and amortisation (EBITDA) jumped by 29.4% to GHS3.5 billion.

The EBITDA margin fell 1.3 percentage points to 56.1%, with total capital spending of GHS2.2 billion in the first six months.

In addition, MTN Ghana paid GHS2.7 billion in direct and indirect taxes.

Commenting on the telco's performance, MTN Ghana CEO Selorm Adadevoh said the company remained robust despite some obstacles, such as inflation.

"MTN Ghana executed its commercial plans for the half-year and delivered growth in voice, data and MoMo, supporting a 32.3% year-on-year increase in service revenue.

"This performance was supported by the expansion of our network capacity and coverage, improvements in IT systems and service delivery, and usage from the country's 27.3 million subscribers.

"Network and IT system enhancements were made possible by a GHS2.2 billion capex investment. In H1 2023, we expanded our 4G coverage to 99.3% of the population and deployed 156 2G, 159 3G and 156 4G sites."

Adadevoh added capex growth of 97.4% YOY was driven by the acquisition of spectrum licences, and accelerated infrastructure deployment.

On other metrics, Adadevoh stated data income increased by 41% YOY, to GHS2.6 billion during the reporting period, owing to an increase in the number of active users (+7.6% YOY), as well as a 31.8% YOY rise in MB per active user per month and the resulting increase in data traffic (+41.9% YOY).

"First quarter price revisions helped preserve data revenue growth in the face of elevated inflation and a value-added tax increase from 12.5% to 15%," he noted.

“According to our strategy, the contribution of data revenue to service revenue went from 39% to 41.5% year-on-year."

MoMo revenue climbed by 48.8% YOY, to GHS1.3 billion, while digital revenue decreased by 22.1% YOY to GHS63.6 million.

As the company enters the second half of the year, Adadevoh said: “We do take cognisance of the possible dampening effect on Ghana's economy from upward inflationary pressures, risks from Ghana's debt sustainability and currency volatility.

“However, based on the effective implementation of our business strategy, MTN Ghana has updated its medium-term projection for service revenue growth from the low-20s to the high-20s (in percentage terms)."

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