MTN records 57% profit growth, to list on NSE June
MTN Group reported 56.8 per cent growth in profit before tax for the financial year ended December 2018 and confirmed its plans to list on the Nigerian Stock Exchange latest June this year.
The listing, according to the telecoms company, will be by introduction and is subject to regulatory approval.
It reported a profit before tax of R15.0bn in the 2018 financial year as against R9.57bn in 2017.
The company revealed that the growth in earnings in Nigeria did not include the $53m (R744m) payment to the Central Bank of Nigeria, and was mainly driven by double-digit growth in services, data and fintech revenue.
The telecoms company said the $53m payment to Nigerian authorities was paid on January 4, 2019, saying it was one of the one-off costs that negatively impacted its headline earnings per share.
In Nigeria, the company recorded 17.2 per cent growth in service revenue, 39.3 per cent improvement in data revenue, 18.7 per cent growth in voice revenue and 32.7 per cent growth in fintech revenue, which includes airtime lending and e-commerce.
However, the digital revenue of the company suffered a decline of 58.5 per cent in 2018, which was attributed to further optimisation of value-added services, but the company expressed optimism that there would be digital revenue growth this year.
Considering the key regulatory challenges the telecoms company faced in the Republic of Benin, Cameroon and Nigeria, MTN vowed to improve on its management of regulatory issues.
“Managing regulatory issues and improving relationships and risk management remain key focus areas for the group, and we will continue to strengthen these areas in 2019,” Group President and Chief Executive Officer, Rob Shuter, said.
Commenting on the results, Chief Executive Officer, MTN Nigeria, Fordi Moolman, said, “MTN plans to list by introduction on the Nigerian Stock Exchange during the first half of 2019 and is looking to simplify the capital structure ahead of this listing.
“The company’s listing on the exchange will create a new telecoms asset class for investors and provide an opportunity for a wider group of Nigerians to participate in our investment story.”
Moolman added, “In 2018, we rebuilt the base; adding another six million Nigerians to our network, giving a total of 58 million people access to worldwide communication services.”
The company reported that the legal services rendered to settle the Certificates of Capital Importation dispute with the CBN and the listing on the NSE gulped R194m (N5.32m).
“This was despite the margin being negatively impacted by once-off legal costs related to the resolution with the CBN as well as the planned listing costs. These costs totalled R194 million,” the financial report stated.
It added, “MTN Nigeria is clearly benefiting from deliberate investments in our network, cost optimisation initiatives and human capital.”
Shuter disclosed plans to divest from Jumia, ATC Ghana, IHS towers, ATC Uganda towers and Botswana joint ventures, among others to generate R15bn ($1.1bn) in order to boost its balance sheet.
He said MTN’s 53 per cent stake in Mascom Wireless Botswana had been considered as “non-core in light of the lack of control position and inability therefore to execute the BRIGHT strategy.”
He said the group planned to sell its stakes to Econet Wireless Limited for $300m, adding the transaction was subject to various approvals and expected to be concluded by June this year.
MTN sold its Cyprus unit for $294m last year.