MTN Group reported a 68% decline in headline earnings per share due to currency devaluation in Nigeria and conflict in Sudan. Despite a reported revenue drop of 15.4%, certain sectors like fintech showed growth. The company maintains a stable balance sheet and plans future network investments while increasing dividends for shareholders.
MTN Group has announced a significant decline in its headline earnings per share for the year, reporting a 68% drop to 98 cents per share. The downturn is largely attributed to the continued devaluation of the Nigerian naira and ongoing conflict in Sudan, impacting overall performance. Despite these challenges, the company reported group service revenue falling 15.4% to R177.8 billion, while revenue in constant currency terms saw a modest increase of 13.8%.
In terms of specific revenue streams, data revenue recorded a 12.3% decrease on a reported basis, yet demonstrated a resilient 21.9% rise when adjusted for constant currency. Additionally, fintech revenue showed a reported growth of 11%, soaring to 28.5% in constant currency. Earnings before interest, tax, depreciation, and amortization (EBITDA) also reflected a decline of 33.5%, despite a 10.2% increase to R70.1 billion in constant currency. Furthermore, the EBITDA margin fell to 32% on a reported basis, down 8.9 percentage points.
The group experienced a 2.2% increase in total subscribers, reaching 290.9 million, with active data subscribers rising by 7.7% to 157.8 million. Additionally, the number of monthly active Mobile Money users rose by 0.9%, totaling 63.1 million. MTN Group CEO Ralph Mupita expressed satisfaction with the company’s strategic execution for fiscal year 2024, acknowledging operational challenges but noting positive macroeconomic trends in key markets.
MTN’s balance sheet remains stable with a net debt-to-EBITDA ratio of 0.7x at year-end, improving from 0.4x the previous year, and the holding company leverage stands at 1.4x. The board declared a final dividend of R3.45 per share, projecting an increase to at least R3.70 in the 2025 fiscal year. MTN plans to adhere to its medium-term guidance and allocate R30 billion to R35 billion for network investments in the fiscal year 2025, contingent upon current currency assumptions.
In conclusion, MTN Group is navigating through significant challenges, resulting in a marked reduction in earnings and service revenue. Nevertheless, the company showcases resilience in certain revenue streams and maintains stability within its financial structure. The management’s optimistic outlook for future investment demonstrates a commitment to growth and adaptation in a fluctuating economic environment.
Original Source: techcentral.co.za
