MTN Group, yesterday, announced that it had
attained 200 million subscribers milestone
across its 22 operations in Africa and the
Middle East.
This is even after cutting off about 3.2 million
Nigerian subscribers from its network.
In celebration of the feat, the company
announced a R200 million initiative to improve
the quality of education across its markets in
Africa and the Middle East in the next two
years.
The cut off of Nigerian subscribers was
notwithstanding the impressive impact the
region made in the overall revenue standing in
its half year report.
The company posted a 22 percent rise in first-
half earnings as foreign exchange gains from
international operations.
Nigeria was the biggest revenue earner in the
six-month period, although earnings from the
country and other international operations
were boosted by a 16 percent decline in the
South African rand.
However, MTN said it had to cut off 3.2
million users out of its 55.2 million customers
in Nigeria in July due to regulations demanding
that all subscribers be registered
Group President and CEO of the company, Mr.
Sifiso Dabengwa, while announcing the
development said that as a multinational
telecommunications company operating in
emerging markets, MTN had been exposed to a
particular opportunity of making meaningful
contribution to social development.
Dabengwa also added that “due to the lack of
access to quality education and infrastructure,
and low literacy rates in most of these
countries, MTN has chosen to direct a
significant amount of its corporate social (CSI)
spend towards education over the next two
year. This will provide people with the skills,
knowledge and confidence they need to make
positive decisions about their lives.
“As seen in MTN’s 2013 interim results
released today, (yesterday) MTN is a growth
company with a solid performance record and
an inspirational vision to lead the delivery of a
bold new digital world to its customers.
It will continue to share the fruits of its
success with customers and communities
through, among others, offering affordable
and innovative services, as well as investing in
social upliftment and network infrastructure to
improve the quality of its services” he added.
Meanwhile, stiff price competition between the
four telecoms providers in its home turf,
including the Vodacom, Cell C and Telkom, hit
MTN’s margins. MTN said its South African
EBITDA margin fell by 2.1 percentage points in
the first half, from 35.4 percent a year ago.
“The focus on costs for South Africa is going to
be important as we deal with this kind of
structural pricing situation that we have seen
during the first half of the year,” Chief
Executive Sifiso Dabengwa said in a
presentation.
MTN’s South African subscribers shrank by 1.5
percent to 25 million in the first six months,
while revenue declined by 1.4 percent from
the previous year. The numbers were worse
than expected. They have clearly not kept up
with the market,” said an analyst who asked
not to be identified because he is not allowed
to give named quotes to media.
The company added 12.2 million new users in
the first six months, in line with a 21.1 million
subscribers target for the year. Dabengwa said
MTN was still in talks regarding repatriation of
a $400 million loan from Iran and a further
$50-$200 million in .
He said last month’s resignation of chief
financial officer Nazir Patel was not related to
its operations in Iran, as some media reports
have speculated.
MTN, which failed to clinch a much coveted
licence in Myanmar earlier this year, said it
had dropped talks to acquire Neotel, the South
African unit of India’s Tata Communications.
MTN’s diluted headline earnings per share
totaled 649 cents for the six months to end-
June, compared with 532 cents last year.
Headline EPS, the main profit gauge in South
Africa, excludes certain one-time items.
It had flagged earlier this month its results
would likely rise by as much as 25 percent.
Group revenue rose nearly 10 percent to 65.2
billion rand ($6.53 billion), and subscribers
totalled 201.5 million, a 6.5 percent increase.
MTM shares closed 1.6 percent higher, ahead
of the benchmark Top-40 index which was up
0.9 percent.
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