MTN Group’s shares soar on the back of Nigeria’s performance


    MTN Group’s shares has short up in Johannesburg to a near-seven-year high to over R190 (US$12.44) per share, on the back of a strong full year performance of its biggest operation, MTN Nigeria.  

    MTN Nigeria turned in a strong set of financial results for the year ended 31 December 2021, with margin improvement across the board and a spike in profits.

    Its operating margin – calculated using earnings before interest, tax, depreciation and amortization (Ebitda) – climbed by 2.1 percentage points to 53%, while profit after tax and earnings per share jumped by 45.5% each to ₦298.7-billion (US$722.8 million) and ₦14.67 kobo respectively.

    The company therefore increased its full-year dividend by almost 40% to ₦8.57 kobo per share.

    The strong numbers came despite a 10.6% decline in the Nigerian company’s mobile subscriber base – impacted by regulatory restrictions on new SIM sales and activations.

    The performance in Nigeria also fueled a 23.3% growth in the group’s service revenue, exceeding its mid-teens target, driven mainly by voice, data and fintech services.

    MTN has now decided to revise the medium-term target for service revenue growth to north of 20%, suggesting there’s momentum behind the latest performance.

    Key metrics

    Other key metrics included:

    • Free cash flow climbed by 31.1%;
    • Voice revenue grew by 8.4% (from a 7.9% increase in minutes of use);
    • Data revenue rose by 55.3%, underpinned by investment in the company’s 4G network, which now covers more than 70% of the Nigerian population;
    • Average data consumed per user rose by 62.7%, enabling overall data traffic growth of 85.3%. Smartphone penetration grew by four percentage points to reach 50%;
    • Fintech revenue rose by 57.3% due to sustained growth in the use of a product called Xtratime product and broader fintech services use by customers; and
    • Mobile Money transaction volume rose by 167% from an active user base of 9.4 million, up 102%.

    Capital expenditure for the year rose by 36.7% to ₦408.3-billion (over US$988 million), including spending on 9,336 new 4G sites. “Capex intensity remained within target levels at 18.4%,” MTN said.



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