MTN spends R4.6bn to tap growth from data
TELECOMMUNICATIONS giant MTN said yesterday that it had spent R4.6 billion during the first quarter of this year to improve its network as it aimed to unlock value in the digitaland data-adoption space for future growth.
The company said most of the expenditure had been by its Nigerian, South African and Iranian operations.
MTN group president and chief executive officer Rob Shuter said the adoption of data and digital presented the group with a major opportunity.
“We think we are uniquely positioned to take advantage of the opportunity in terms of our brand, customer base, our infrastructure and positioning in the market, our home markets – our frontyard and backyard so to speak,” Shuter said.
The group’s revenue for the quarter to the end of March increased 7.1 percent, and data revenues were up 29.4 percent year-on-year.
The company said data revenue contributed 20 percent to its revenue in the period.
MTN’s South African market reported a 4.1 percent increase in service revenue, while its Nigerian operations saw an 11.6 percent increase in revenue in the period under review.
MTN Irancell increased its total revenue 19.3 percent, which MTN attributed to encouraging data revenue trends in the country.
Voice traffic increased 2 percent, and total data traffic surged 145 percent.
However, subscribers decreased 1.5 percent quarter-on-quarter.
Shuter said the group had undertaken a review of how it noted subscribers’ numbers.
“While our reported subscriber numbers are lower than we had expected, this is largely the result of an ongoing review of subscriber definitions.
“We are planning to further modernise our internal subscriber definitions, to more closely align with the changing mix of revenue streams, and will report on this at the end of the first half of 2017.”
MTN has about 237 million subscribers in 22 countries across Africa and the Middle East.
Earlier this year, MTN reported its first loss in two decades after it said the hefty fine imposed by the Nigerian government had wiped R10bn from its headline earnings.
The group reported a headline loss of R1.4bn in the year to the end of December, compared with headline earnings of R13.6bn the previous year.
The group agreed to pay a fine of $1.1bn (R14.36bn), reduced from $5.2bn, in June last year after a prolonged legal battle in Nigeria over missing a deadline to terminate unregistered SIM cards.
The group has since enlisted new blood in its management ranks, with Shuter recently taking over the reins. He was joined by former Old Mutual executive Ralph Mupita as the group chief financial officer.
The group’s South African operations are now spearheaded by two former Vodacom executives: chief operations officer Enzo Scarcella and chief executive Godfrey Motsa.
The company yesterday said the new executives have hit the ground running.
“In March 2017, we completed the evolution of the core senior management team. The new group president and chief executive officer, chief financial officer and chief operating officer are now in place and have settled in, swiftly adjusting to their respective roles, while beginning a review of the business to see where further improvements can be made,” the company said.