MTN SA grows subscribers amid earnings drop

MTN says its South African operation increased its subscriber base by 8.9% to 28 million, in results for the year ended December 2014.

The mobile operator reported 2.7 million net additions in the second half versus the 430,496 net disconnections recorded in the first half of the year, suggesting a turnaround in recent fortunes.

Local revenue however, declined 3.9% to R38.9 billion, from R40.48 billion, while EBITDA slipped to R12.5 billion, from R14.0 billion before. This was mainly a result of a 36.0% decline in interconnect revenue due to lower mobile termination rates (MTRs), the group said.

“MTN South Africa delivered clear evidence of a turnaround in the second half of the year and in the fourth quarter EBITDA increased 28,1% quarter on quarter,’ it said.

MTN said it pre-paid subscriber base increased by 9.1% to 22.6 million, while the post-paid segment delivered a significantly improved performance, reporting net subscriber additions of 414,251 for the year.

While data revenue only increased 7,0% there was a meaningful improvement in the fourth quarter with mobile data revenue growth of 17% when compared to the same period last year, MTN said.

By year-end, data revenue contributed 23.8% of total revenue from 21.4% in 2013.

The number of smartphones on MTN’s network increased by 17.8% to 5.9 million, and the number of data users increased by 20.1% to 17.1 million.

Capex for the period of R5.676 billion was slightly lower than budget due to improved procurement processes.

During the year, MTN said it added 520 new 2G sites and 904 3G sites. The 3G population
coverage improved to 87%.

For group operations, which includes 22 countries in Africa and the middle east, MTN said subscribers increased 7.5% to 223.4 million, while revenue increased 6.4% to R146.154 billion.

Data revenue increased 33.2% to R27.3 billion, while EBITDA increased 10.2% to R65.5 billion.

MTN delivered a final dividend of 800 cents per share, with total dividend of R12.45 per share.

Group capex however, decreased 16.3% to R25.24 billion.

Looking ahead, MTN said it expects to benefit from a number of interventions put in place in South Africa and Nigeria in the previous year.

“In South Africa, we expect to build on the positive momentum gained on revenue and subscriber additions in the second half of 2014. The South African operation will also
accelerate its immediate capex plans to support our medium-term growth prospects, particularly in the data area.”

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MTN SA grows subscribers amid earnings drop