MTN expects big earnings jump

 ·20 Feb 2014
MTN take off

MTN says it expects an increase of between 25% and 30% in headline earnings per share when it reports its financial results for the year ended December 2013.

Shares in the mobile operator advanced R1.31 to R202 in morning trade on the JSE, with the group showing a 52 week return exceeding 18%.

The group reported HEPS of  R10.89 in results ended 2012, with revenue up to R135 billion.

MTN said it anticipates an increase of between 25% and 30% in attributable earnings per a share, up from  R11.26 in 2012.

The HEPS and EPS for the year were positively affected by foreign exchange gains of approximately R1.1 billion compared to foreign exchange losses of approximately R2.7 billion in the prior year, MTN said.

The foreign exchange gain was mainly a result of a R2.3 billion exchange rate gain in MTN Mauritius partly offset by foreign exchange losses on certain operational working capital accounts, the group said.

Last week, MTN filed an application at the High Court, seeking an urgent interdict to stop Icasa from implementing its proposed rate cuts on 1 March 2014.

The Independent Communications Authority of South Africa (Icasa) released its “Call Termination Regulations, 2014” on 29 January 2014, which will see mobile termination rates (MTR) reduced from the current 40c per minute to 10c per minute over the next three years.

The regulations further call for significant asymmetry, up from the current 10% to 120% from March 2014, 180% from March 2015, and 300% from March 2016.

These regulations will benefit Telkom and Cell C, while MTN and Vodacom have both said the the rate cuts would cost them up to a billion rand in lost revenue.

MTN is expected to publish its results on 5 March.

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MTN makes good on legal threats against Icasa

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