MTN shares take a knock as it returns to profit

MTN shares took a bit of a knock on Thursday, following a earning update from the group announcing a return to profit.

The mobile operator reported that it is currently in the process of finalising its financial results for the six months ended 30 June 2017, and its interim 2017 basic headline earnings per share are expected to be between 210 cents and 230 cents.

This compares with a headline loss per share of 271 cents and attributable loss per share of 301 cents reported in the prior comparable period.

However, despite the report that MTN is back in the black, share trades dropped almost 5% when markets opened, following steady gains made throughout the week.

By 09h30, MTN’s shares were trading at R121.96, down 4.1% from Wednesday’s close of R127.23, having dropped as low as R120.30 in early trade.

In its full year 2016, MTN reported its first-ever loss, which was mainly due to the non-recurring costs involved in the Nigeria regulatory fine, which hit the group for 474 cents per share.

Other knocks were felt in through the professional fees related to the fine as well as losses of 136 cps from MTN’s 51% equity interest in Nigeria Tower, it said.

Despite the knock, MTN’s shares are in a stronger position than a month ago, having climbed almost 10% from June lows. However, the share is still off from its 2017 high of R134.94 seen in January, and even further still from the R144.05 price seen exactly a year ago.

MTN will publish its interim results on 3 August 2017.

Read: Highest paid bosses: MTN vs Telkom vs Vodacom

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MTN shares take a knock as it returns to profit