MTN Nigeria increased its subscriber base by 2.1 percent to 61.1 million in the first quarter (Q1) of 2015 from 59.9 million in the fourth quarter (Q4) of 2014 amid weakening macro-economic environment in the country.
Subscriber base rose by 6.8 percent year-on-year (y/y) from 57.2 million in the corresponding first quarter (Q1) of 2014.
According to its quarterly update for the period ended 31 March 2015, competitive value propositions including promotional deals focused on family and friends, which stimulated on-net traffic in Nigeria, MTN’s biggest market saw the group record a satisfactory subscriber growth.
However, Average revenue per user in Nigeria declined 1.4 percent as call volumes fell amid rising inflation and lower customer spending. Total minutes on the network declined by 2.0 percent quarter-on-quarter (q/q) impacted largely by seasonality, and also declined 2.4 percent y/y mainly due to increasing inflation and reduced consumer spend.
Commenting on the results, Sifiso Dabengwa, Chief Executive Officer said, “MTN’s results for the quarter were impacted by a weaker macro-economic environment following the reduction in the price of oil in 2014 and continued price competition. MTN Nigeria improved subscriber growth trends although revenue and minutes growth remains a challenge”.
Local currency data revenue continued to grow strongly increasing by 17.0 percent y/y and now contributes 19.7 percent to total revenue. This was achieved despite the significant y/y decline in data tariffs and was driven by data subscriber growth of 17.6 percent y/y as well as strong growth in digital services.
Voice revenue growth remains challenging and below expectations, however the trend over the past six months remains positive with improvements in average daily revenues.
MTN Group Ltd’s subscriber base rose at the slowest pace year-on-year in Q1 2015 as declining oil prices and weaker economic trends affected the growth of Africa’s largest wireless operator.
MTN’s customer base increased by 1.8 percent to 227.5 million across 22 countries in the first quarter of the year – the slowest rate since a 1.1 percent gain in the corresponding quarter of 2014.
The group has been cutting costs and exploring potential acquisitions as revenue shrinks in its home market of South Africa, where it trails rival competitor Vodacom Group Ltd. in terms of customer numbers.
Subscribers in South Africa, the operator’s second-largest market, were little changed at 28 million while data sales in the country increased by 22 percent y/y. Vodacom has 32.6 million active customers.
Reported data revenue increased by 16.7 y/y, contributing 20.8 percent to the group’s total revenue while organic data revenues soared 24 percent y/y, “We continue to focus on our non-voice services which remain the key driver of the Group’s revenue growth”, Dabengwa said in a statement on Thursday.
Mobile Money showed strong growth – registered Mobile Money subscribers across the Group of 27.4 million, rose by 23.2 percent q/q across 14 operations. MTN remains at the forefront of global technological changes, connecting around 228 million people in 22 countries across Africa and the Middle East.
Analysts forecast a slower growth for second quarter (Q2) 2015 amid the recent spate of xenophobic violence in Johannesburg and Durban focusing on foreigners. MTN Nigeria has cautioned against reprisal attacks on multinationals that have links with South Africa owing to the xenophobic attacks on foreigners and their businesses.
The company earlier, reacted to calls for reprisal against known South African business interests in Nigeria, claiming such a move will be counter-productive, as it will affect Nigerians more.
Dan Ojabo
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