MTN takes a massive hit

 ·25 Mar 2024

Despite MTN’s increasing revenue and customer base, the group’s earnings and profits have significantly dropped due to the massive devaluation of the Nigerian currency.

“The MTN Group sustained a resilient performance in 2023, with solid underlying operating momentum and pleasing progress in our key strategic initiatives during a period characterised by geopolitical and macroeconomic headwinds,” said group CEO Ralph Mupita.

“The sharp devaluation of the Naira during the period impacted our reported results for MTN Nigeria and MTN Group.”

US Dollar/Naira Exchange over the last five years

Despite the challenging operating environment, the group’s data traffic across its operations grew by 26.3% (35.4% excluding JVs), while fintech transaction volumes grew by 32.2%.

MTN South Africa’s network resilience plan improved network availability and supported commercial initiatives in the face of ongoing load shedding.

By the end of 2023, MTN SA had achieved network availability of roughly 95% ahead of schedule, with the availability of about 98% on the cohort of sites where resilience investment had been finished.

Despite the adverse effects of SIM registration regulations in key markets, the group was able to up its customer base by 2.0% to 295 million, leading to service revenue growth of 13.5% to R210 billion.

Total revenue also increased from R207 billion to R221 billion.

However, the group’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) was down by 0.5% to R90.5 billion.

On a constant currency basis, the group’s EBITDA increased by 9.8% YoY, with the EBITDA margin of 41.5%, largely affected by higher inflation and the effects of foreign currency regulations.

“The extent of these impacts was moderated through the delivery of our expense efficiency programme, which realised savings of R2.6 billion for the year – exceeding our 2023 target of R1.5 billion,” Mupita said.

However, the group’s headline earnings dropped from R20.5 billion to R5.7 billion.

Basic earnings per share dropped by 78.5% from 1,054 cents per share to 227, while basic headline earnings per share declined from 1,137 cents per share to 315.

Nevertheless, the group’s final dividend remained the same at 330 cents per share.

FinancialsFY2022 RestatedFY2023% Change
Revenue207 003221 056+6.9%
Headline Earnings (Rm)20 5325 690 -72.29%
Basic earnings per share (cents)1 054227-78.5%
Basic Headeline Earnings per share 1 137315-72.3%
Final Dividend330330


The group expects elevated headwinds on its businesses due to the elevated and ongoing volatility in its operating environments.

“We are, however, encouraged by the underlying resilience and momentum in our business, as well as the relevance of our Ambition 2025 strategy to capture the structural growth opportunities in our markets,” the group said.

Thus, despite the short-term pressures on the business, the group maintains its medium-term guidance framework, with group service revenue expected to see at least in the mid-teens percentage growth in constant currency terms.

MTN SA revenue is expected to see mid-single-digit percentage growth from MTN SA on constant currency terms

The group’s fintech revenue is also expected to grow from a high of 20% to a low of 30% in constant currency terms.

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