MTN Group reported a 69% drop in annual profit due to the Nigerian naira’s devaluation and challenges in Sudan. The company’s HEPS fell to 98 cents, while pre-tax losses in Nigeria exceeded 550 billion naira. CEO Ralph Mupita is optimistic about recovery efforts in Nigeria and has noted improvements in service availability in Sudan despite ongoing conflict.
MTN Group has reported a significant decline in its annual profit, experiencing a 69% decrease in full-year earnings as a result of the Nigerian naira’s devaluation and operational challenges in Sudan. The South Africa-based telecom giant indicated that its headline earnings per share (HEPS) dropped to 98 cents for the year ending December 31, a substantial decline from 315 cents in the previous year.
The devaluation of the naira was prompted by persistent dollar shortages in Nigeria, which resulted in government measures aimed at stabilizing the currency and attracting foreign investment. These economic challenges, compounded by high inflation and interest rates, contributed to a more than 200% increase in MTN Nigeria’s pre-tax loss, totaling 550.3 billion naira (approximately $355.76 million).
To improve its situation, MTN Nigeria is implementing various initiatives, such as renegotiating tower leases and increasing tariffs, with approval granted in January. Group CEO Ralph Mupita expressed optimism regarding the company’s recovery in Nigeria, noting, “That pain which we’ve had for 18 months, is abating somewhat … the business is growing very strongly. So I’m actually very bullish and confident that we’ll see strong recovery in Nigeria.”
In Sudan, MTN’s financial performance was adversely affected by ongoing armed conflict, resulting in impairments amounting to 11.7 billion rand ($643.40 million). Mupita mentioned improvements are occurring, stating that MTN has begun to restore services in conflict-affected areas, including Khartoum, where the network had been down since April 2023.
Across its entire operations, MTN Group reported a 15% decline in group service revenue, totaling 177.8 billion rand, although in constant currency terms, revenue increased by 14%. Meanwhile, the South African market showed a positive trend, with a 3.1% rise in service revenue, driven by growth in data, fintech, digital, and enterprise services. The Group declared a final dividend of 345 cents per share and anticipates a minimum dividend of 370 cents in the financial year ending December 2025.
In summary, MTN Group’s annual profit has significantly declined due to the devaluation of the Nigerian naira and operational difficulties in Sudan. The company is actively pursuing measures to stabilize its Nigerian business, with a positive outlook from the CEO regarding recovery. Despite challenges, there are encouraging developments in South Africa, and MTN remains committed to shareholder returns through future dividends.
Original Source: telecom.economictimes.indiatimes.com
