MTN group posts strong first-quarter service revenue growth

AFRICA- Telecommunications giant MTN Group has met its medium-term revenue growth guidance, posting a 10% year-on-year increase to R33.2-billion, supported by a continued rise in voice, data and financial technology (fintech) revenue, during the three months to March 31, 2019.

This was led by strong first-quarter operational performance in South Africa, Nigeria and Ghana.

“MTN’s positive commercial momentum continued in the first quarter with a pleasing operational performance across the markets, led by South Africa, Nigeria and Ghana. Group service revenue grew by 10% year-on-year, in line with our medium-term guidance of double-digit service revenue growth,” said group president and CEO Rob Shuter on Thursday.

Outgoing voice revenue for the quarter under review increased 5.9%, data revenue increased 18.3% and fintech revenue surged 30.6%.

However, the group’s digital revenue plunged 45.4%, owing to the optimisation of value-added services business.

“We are pleased by the service revenue development, despite challenges in some markets,” added group CFO Ralph Mupita.

MTN South Africa achieved a 4.6% increase in service revenue to R9-billion, within the company’s medium-term guidance range, with a sterling performance from the wholesale business.

South Africa’s data and fintech revenue increased by 3.1% and 21.1% respectively, while digital and outgoing voice revenue declined by 35.7% and 4.4% respectively.

MTN South Africa’s margin on earnings before interest, taxes, depreciation and amortisation was 38.8% during the three months to March. On an IAS 17 basis, the margin remained unchanged at 35.3%.

Meanwhile, MTN Nigeria reported a solid quarter with service revenue increasing by 13.4% year-on-year, meeting the company’s double-digit growth guidance.

This was led by a 32.4% increase in data revenue and a 12.7% increase in voice revenue.

MTN Nigeria reported an amortisation margin of 53.3%.

The Southern and East Africa and Ghana grouping delivered a strong performance, mostly driven by MTN Ghana, MTN Uganda and MTN Rwanda, with an aggregate service revenue increase of 21.2%.

In the West and Central Africa region, performance had been impacted negatively by the under performance of MTN Ivory Coast, leading to a 1.4% contraction in the region’s service revenue.

In the Middle East and North Africa, excluding Iran, service revenue increased by 22.6%.

“We made good progress in our work to build a digital operator, adding 2.6-million active data subscribers and 1.2-million MTN Mobile Money subscribers,” Mr. Shuter continued.

While South Africa lost nearly 1.2-million subscribers quarter-on-quarter, the group recorded a year-on-year increase from 29.8-million subscribers in the first quarter of 2018 to 30.01-million in the first quarter of 2019.

At the end of March, MTN South Africa had 24.1-million prepaid users, 5.9-million postpaid subscribers and three-million Internet of Things subscribers.

The subscriber numbers in Nigeria surged from 58.1-million and 54.5-million in the first and fourth quarter of 2018, respectively, to 60.2-million in the first quarter for 2019.

Overall, the group’s subscribers as at March 31 reached 236.6-million, up from 220.8-million in the first quarter of 2018 and 232.5-million in the fourth quarter of 2018.

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