MTN Nigeria released its unaudited financial results for the nine months ended September 30, 2019, showing a significant increase in service revenue by 12.1 percent to reach N854.9 billion, mainly driven by increase in voice and data revenues. The results also show an increase in earnings before interest, tax, depreciation and amortization (EBITDA) margins, its capital expenditure (Capex) and active data users on the network.
The telecommunications company which listed on the Nigerian Stock Exchange (NSE) in May 2019, saw earnings per share rise by 29 percent to N7.29k (IAS 17:36.6 percent to N7.72k).
EBITDA margin increased by 10.5 pp to 53.7 percent (IAS 17: 44.7 percent, up 1.5pp) while active data users increased by 1.6 million to 22.3 million and the company increased its capital expenditure (Capex) by 39.5 percent to N154.1 billion (IAS 17: 20.9 percent to N133.5 billion Year on Year (YoY)
Commenting on the results, Ferdi Moolman, CEO, MTN Nigeria said; “Our performance was very encouraging, demonstrating the resilience of our business despite a challenging operating environment. We sustained double-digit growth in service revenue led by growth in voice and data revenue. We recorded 61.6 million subscribers, representing a 0.1 million increase QoQ. We were required to undertake a SIM re-registration process, which resulted in a disconnection of around 0.6 million active subscribers, limiting base growth. During the quarter, we focused on the end-to-end optimisation and repositioning of our data offerings.”
MTN has in the last year made significant investment in accelerating the 4G network expansion. Leveraging its 800MHz spectrum acquired from Visafone and activated in the second quarter of 2019, the telecoms network operator launched enhanced 4G+ services in Lagos, Abuja and Port-Harcourt.
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“We also changed our pricing strategy, placing us in an even stronger competitive position going forward. As a result, we have begun to see promising results with active data subscriber net additions of 1.6 million and 4G population coverage at over 35 percent in 64 cities. Data traffic volume also increased by over 68 percent, while data revenue rose by 34.9 percent yoy,” Moolman said.
Speaking on the significant increase in service revenues, Moolman said: “Voice remains a key contributor to service revenue at 73.5 percent (Q3 2018: 74.8percent), with its growth supported by an increase in subscribers, relatively stable tariffs and our targeted segment offerings using our customer value management toolkit. Data contributed 18.0 percent (Q3 2018: 15.0 percent) to service revenue, with strong growth attributable to the recent data price revamp, consumer education and improved 4G coverage after we obtained access to the 800MHz spectrum in Q2 2019. We recorded a significant increase in both active data users and the number of smartphones on our network, which resulted in higher data usage. We added 1.6 million smartphones on our network, increasing smartphone penetration to 41.7 percent. The number of active data subscribers increased by 7.6 percent to 22.3 million, driving data traffic growth of 68.9 percent.”
