MTN Group reports a 68% decline in earnings per share due to currency devaluation and conflict, with total service revenue dropping 15.4%. Key results highlight increases in fintech and active subscribers, while maintaining stability in the balance sheet. The outlook includes a dividend increase and significant network investments planned for 2025.
MTN Group experienced a significant 68% decline in headline earnings per share, dropping to 98 cents, primarily due to the depreciation of the naira in Nigeria and ongoing conflicts in Sudan. The company’s annual financial results, released for the year ending December 31, 2024, revealed a 15.4% decrease in total service revenue to R177.8 billion, although this figure showed a 13.8% increase when adjusted for constant currency.
Key components of the annual results included the following: Data revenue saw a reported decline of 12.3%, yet in constant currency, it surged by 21.9%. Additionally, fintech revenue rose by 11% on a reported basis and leaped by 28.5% in constant currency. Earnings before interest, tax, depreciation, and amortisation (EBITDA), before special items, decreased by 33.5% on a reported basis but improved by 10.2% in constant currency, reaching R70.1 billion. The EBITDA margin decreased to 32%, a reduction of 8.9 percentage points on a reported basis but only 0.8 percentage points lower in constant currency at 38.2%.
MTN reported a 2.2% increase in total subscribers, bringing the total to 290.9 million, with active data subscribers increasing by 7.7% to 157.8 million. Moreover, the Mobile Money segment recorded a 0.9% rise in monthly active users, totaling 63.1 million.
Ralph Mupita, the CEO of MTN Group, expressed his satisfaction with the underlying performance despite the external challenges, stating, “We are pleased to report a strong underlying performance and strategic execution for FY2024, despite challenges in the operating environment.” He further noted improvements in macroeconomic indicators, particularly in inflation and foreign exchange rates.
The group maintained a stable balance sheet, achieving a net-debt-to-EBITDA ratio of 0.7x at year-end, up from 0.4x the previous year. Holding company leverage stood at 1.4x, consistent with previous assessments. The board announced a final dividend of R3.45 per share, with expectations to increase this to at least R3.70 for the 2025 financial year.
MTN Group intends to continue adhering to its medium-term guidance, projecting network investments between R30 billion and R35 billion for the 2025 financial year, contingent on current currency conditions.
In summary, MTN Group faced a significant decline in earnings largely influenced by currency devaluation and regional conflicts. Despite these setbacks, the company showed resilience in core areas such as fintech and data revenue, leading to improvements in subscriber numbers and stable financial metrics. The outlook remains cautiously optimistic, with plans for continued investment and dividend growth.
Original Source: techcentral.co.za
