Exchange rate hurts MTN’s revenue in the last quarter
Total income and group services income decline by 13.4% and 14%
MTN, AFRICA’S leading mobile operator, yesterday said that exchange rate movements had a negative impact on total and group services revenue for the September quarter. However, it posted growth in data and digital revenue.
MTN, which operates in 22 countries in Africa and the Middle East, said that total revenue and group service revenue had declined by 13.4 percent and 14 percent, respectively, largely due to exchange rate movements.
However, data revenue strengthened by 31.4 percent and digital revenue was up 19.6 percent in the period under review in September.
In South Africa’s organic service revenue increased by 5.2 percent.
Data and digital services revenue rose by 21 percent and 27.7 percent, respectively, supported by a strong prepaid performance and the continued recovery of the postpaid consumer segment.
In Nigeria MTN reported an 11.2 percent growth in total revenue, supported by data revenue which strengthened by 72.1 percent.
In Irancell, total revenue increased by 16.8 percent.
However, the group saw a marginal decline in subscribers.
Group subscribers declined marginally by 0.7 percent quarter-on-quarter to 230.2 million on the back of lower reported subscribers in Nigeria “as we continue to refine our active subscriber definitions as well as the disconnection of approximately 750 000 subscribers in Uganda as a result of regulatory SIM registration requirements”.
In South Africa subscriber numbers declined by 1 percent to 30.9 million, impacted by a 1.3 percent decline in the prepaid segment.
MTN chief executive, Rob Shuter, said the group continued to make steady progress in implementing its Bright strategy, with a strong focus on operational execution across the group.
“Our key growth drivers of data and digital services performed well with revenue growth of 31.4 percent and 19.6 percent respectively,” he said.
Shuter also said that in the quarter, MTN had accelerated its network investment programme.
A total of 1 641 3G and 2 102 4G sites had been rolled out in the quarter, supporting the demand for data services.
Shuter, a telecoms and banking veteran, was appointed last year with the task of reviving the company after the $5.2 billion (R71.23bn) fine by Nigerian regulators, which was negotiated down to $1.7bn impacted performance in 2016.
MTN described the year ending in December 2016 as “the most challenging year in the company’s 22-year history”. It reported a $108 million headline loss in 2016, its first loss in two decades, partially owing to the Nigerian fine and currency movements.
Shuter in August unveiled a strategy known as Bright, aimed to improving top-line growth, margins and cash flow over the medium term.
Yesterday MTN announced the appointment of Ebenezer Asante, a former MTN Ghana chief executive, as vice-president the new South and East Africa and Ghana Region, effective October 1, in a bid to further strengthened its management structure to support the Bright strategy.
Through the Bright strategy Shuter projected that MTN would generate R815bn from revenue pools across its 22 markets by 2020, including R575bn from data, voice and digital services.
A total of R210bn was expected from enterprise and R30bn from wholesale revenue, the company previously said.