MTN Group reported a 69% slump in profits due to the Nigerian naira’s devaluation and operational troubles in Sudan. HEPS fell to 98 cents, while pretax losses in Nigeria surged over 200%. Despite a 15% drop in group service revenue, a 14% increase in constant currency revenue was noted. The final dividend increased slightly to 345 cents.
MTN Group, the largest telecommunications operator in Africa, announced a significant decline in annual earnings, reporting a 69% drop in profits due to the devaluation of the Nigerian naira and operational issues in Sudan. The company’s headline earnings per share (HEPS) fell to 98 cents for the year ending December 31, down from 315 cents in 2022. The Nigerian government is addressing chronic dollar shortages by devaluing the naira to stabilize the currency and attract investment.
The depreciation of the naira, compounded by persistent inflation and high interest rates, has resulted in increased costs for MTN. Consequently, the pretax loss for MTN Nigeria surged over 200% to ₦550.3 billion (approximately $355.76 million). Additionally, the group’s operations in Sudan were adversely affected by ongoing armed conflicts, as noted by Group Chief Executive Officer Ralph Mupita.
Despite the economic challenges, MTN Group, which boasts 291 million customers across 16 African markets, reported a 15% decrease in group service revenue, amounting to R177.8 billion ($9.78 billion). However, when evaluated in constant currency, this revenue experienced a 14% increase. The company also declared a final dividend of 345 cents per share, slightly higher than the previous year’s dividend of 330 cents.
In summary, MTN Group’s annual profits were significantly impacted by the devaluation of the Nigerian naira and operational difficulties in Sudan, leading to a notable decline in earnings per share and pretax losses. Although revenues decreased on a reported basis, a favorable trend emerged in constant currency. The company’s commitment to dividend payouts suggests a cautious optimism amidst challenging economic conditions.
Original Source: www.zawya.com
