Nigeria, lawyers and the rand – MTN explains its losses
MTN has detailed why it is set to report a headline loss for its 2016 financial year.
In a trading update published on Monday (27 February), MTN said it expects to post a basic headline loss per share of between 74 cents and 81 cents and a basic loss per share of between 137 cents and 151 cents, for the full year ended December 2016.
In the prior year comparable period MTN reported headline earnings per share of 746 cents and earnings per share of 1,109cents.
The telco group attributed the bulk of its losses to the Nigerian regulatory fine imposed on the group following a fallout with the country’s security authorities, which had a 455 cents per share (cps) negative impact.
In addition, the results were negatively impacted by the following:
- Foreign exchange losses – 324 cps;
- The ‘interest unwind’ related to the Nigerian regulatory fine – 45 cps;
- The MTN Zakhele Futhi BBBBEE transaction charge – 88 cps;
- Professional fees related to the settlement of the Nigerian regulatory fine – 73 cps;
- Losses from our investments in Digital Group being mainly Africa Internet Holdings (AIH), Middle East Internet Holdings (MEIH) and Iran Internet Group (IIG) – 39 cps;
- Hyperinflation impact – 37 cps; and
- Losses from the Nigeria tower company mainly as a result of foreign exchange losses on US dollar denominated loans – 122 cps;
MTN’s financial results for the year ended 31 December will be announced on Thursday, 2 March 2017.
Read: MTN calls for calm over alleged xenophobic attacks in Nigeria and SA
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