MTN Nigeria Communications Plc (MTN Nigeria) has announced its unaudited results for the first-quarter (Q1) ended March 31, 2022. The leading Telco recorded revenue of N470.984billion in Q1’22 as against N385.318billion in Q1’21, up 22.23percent.
Operating profit was up by 34.72percent to N179.326billion from N133.107billion in Q1’21; while profit before taxation (PBT) of N143.588billion as against N102.989billion in Q1’21 implies 39.42percent increase.
MTN Nigeria closed the first-quarter (Q1) to March 31 with profit after tax (PAT) of N96.820billion as against N73.748billion in Q1’2021, up by 31.28percent.
MTN Nigeria is one of Africa’s largest providers of communications services, connecting over 70 million people in communities across the country with each other and the world.
Mobile subscribers declined by 1.3 million to 70.2 million year-on-year (YoY), impacted by the regulatory restrictions on new SIM sales and activations. MTN Nigeria added 1.7 million subscribers in Q1 2022 versus fourth-quarter (Q4) 2021; while active data users increased by 3.4 million to 35.9 million YoY.
MTNN added 1.6 million active users in Q1 2022 versus Q4 2021. The Telco’s active fintech subscribers rose by 6.2 million to 10.7 million YoY; it added 1.3 million subscribers in Q1 2022 versus Q4 2021. Its Service revenue increased by 22percent to N469.8billion in Q1’22.
The company’s earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 25.7percent to N257.1 billion; EBITDA margin increased by 1.5 percentage points (pp) to 54.6percent, while its earnings per share (EPS) rose by 31.3percent to N4.76 kobo. Capital expenditure (Capex) rose by 80.8percent to N162.5 billion (up 156.8percent to N81.2 billion, excluding right of use assets).
At the Annual General Meeting held on April 28, 2022, the shareholders approved a final dividend of N174.5 billion, representing N8.57 kobo per share for FY 2021. At N214 the share price closed on Thursday April 28, it implies year-to-date (YtD) by 8.6percent.
Commenting on the first-quarter results, Karl Toriola, MTN Nigeria CEO said: “We have continued to make good progress in the first quarter, building on the momentum we achieved in Q4 2021 and delivering several key milestones as we grow our connectivity business and platforms. This was achieved against a backdrop of significant geopolitical volatility exacerbated by the war in Ukraine. This conflict has significantly impacted energy prices, broader inflation, supply chains and consumer spending”.
Read also: MTN issues N127bn commercial paper, largest in Nigeria
He said, “Nevertheless, I am pleased that we have made significant strides in deepening our relationships with all our stakeholders while substantially enhancing our contributions to government revenue. In recognition of our remarkable performance in remittance of taxes despite the challenges posed by the pandemic, the Federal Inland Revenue Services (FIRS) recognised MTN Nigeria as a top 20 taxpayer and one of the best tax compliant organisations in Nigeria for the 2021 tax year.”
He further noted that in terms of strategic milestones, MTN Nigeria concluded the first phase of a series of transactions to increase Nigerian ownership in MTN Nigeria, “and we are delighted to have welcomed 126,720 retail investors to our shareholder base, many of whom are first-time investors. This includes Nigerian pension funds representing approximately 6.5 million Nigerian contributors. As at March 31, 2022, the number of retail shareholders had increased to approximately 139,000, demonstrating the advances in MTN’s localisation imperative.”
“We also completed a group-wide brand refresh to position the business appropriately as we accelerate our growth and scale our platforms through our Ambition 2025 strategy,” Toriola said.
“In addition, we have fully paid for one lot of 100MHz in the 3.5GHz spectrum band and have been assigned the 3500 – 3600 MHz frequencies for 10 years. We will launch our 5G services once regulatory approval is obtained.
Post the reporting period, we were granted final approval for our MoMo Payment Service Bank (PSB) by the Central Bank of Nigeria (CBN). This will enable us to offer financial services in line with the CBN’s guidelines and support the government in fulfilling its agenda of driving financial inclusion in Nigeria.
“Although our mobile subscriber base declined by 1.9percent YoY from 71.5 million in March 2021 to 70.2 million, we sustained the growth trajectory from Q4 2021 as we ramp up capacity for SIM registration and NIN enrolment. As a result, we added 1.7 million subscribers in Q1 2022. In addition, active data subscribers rose by 10.5percent YoY to 35.9 million, with 1.6 million added in Q1 as we continued to drive data conversion from our new and existing subscriber base.
To enable the growth in subscribers and traffic, we continued to enhance the capacity of our network. In doing so, we frontloaded our capex plan for the year, deploying capex of N162.5 billion in the period to accommodate the sustained demand for data and accelerate the rollout of our 4G network, which now covers approximately 72percent of the population and accounts for 76percent of data traffic”, he stated further.
Toriola said: “Our existing MoMo business provides a solid foundation for launching MoMo PSB and driving digital and financial inclusion in Nigeria. As at the end of March 2022, we had approximately 10.7 million active users and 166k active MoMo agents.
“Our financial performance in the quarter was underpinned by strong commercial momentum, driving growth across our key revenue lines. Service revenue grew by 22percent, in line with our medium-term growth guidance of ‘at least 20percent’. This was led by growth in data and supported by voice, fintech and digital services.
Our ability to drive service revenue growth while managing expenses resulted in an acceleration in EBITDA growth to 25.7percent and EBITDA margin expansion of 1.5pp to 54.6percent YoY. This underpinned profit before tax (PBT) and PAT growth of 39.4percent and 31.3percent, respectively”.
“On the regulatory front, on April 4, 2022, the Nigerian Communications Commission (NCC) announced its decision not to extend the deadline for NIN-SIM linkage further, requiring all operators to restrict outgoing calls for subscribers whose SIMs were not associated with National Identity Numbers (NINs). We have complied with this directive and continue to support the Government’s efforts in their NIN enrolment process. As at 25 April 2022, approximately 60 million subscribers have submitted their NINs, representing about 85percent of our subscriber base.
