The sharp depreciation of the naira this year continued to weigh on MTN Nigeria’s profits, but the group turned in a resilient performance despite macroeconomic pressures and regulatory challenges.
The group managed to eke out a profit of 4.13-billion naira (about R42m) in the third quarter, but for the nine months ended September the group's losses widened to 514.9-billion naira from a loss of 14.9-billion naira a year ago.
Nine-month profit after tax adjusted for the net forex loss was 118.5-billion naira, down 59.2%, it said in a statement on Thursday. Earnings before interest, tax, depreciation and amortisation decreased by 5.3% to 860.2 billion naira.
Despite the top-line growth, ebitda remained under severe pressure primarily because of naira depreciation, worsened by higher energy costs and general inflation, it said.
The naira depreciated further to 1,542 naira to the dollar at the end of September from 907 naira/$ at the end of December 2023, exerting pressure on business activity.
The improvement in liquidity in the foreign exchange market, however, helped the group reduce its exposure to foreign currency-denominated obligations, it said.
Total subscribers decreased by 0.9% to 77-million, affected by the Nigerian Communications Commission’s industry-wide NIN-SIM directive, while active data users increased by 5.1% to 45.3-million.
Active mobile money (MoMo PSB) wallets decreased by 21.8% to 2.8-million.
Service revenue increased by 33.6% to 2.4-trillion naira. The group recorded a 9.8% increase in voice traffic and a 42.1% increase in data traffic.
“Our commercial momentum drove broad-based growth across all revenue segments, demonstrating the underlying strength and resilience of the business,” the group said.
The renegotiated tower lease contracts with IHS Towers led to savings in operating expenses, which positively affected the ebitda margin by 2.3 percentage points, helping to mitigate the effects of macroeconomic challenges.
“As we manage the effects of the ongoing macroeconomic headwinds on our business, we remain focused on initiatives to accelerate our earnings recovery profile, strengthen our balance sheet, and restore our net asset position faster,” it said.
The group continues to engage with the authorities through relevant industry bodies to address tariff increases and mitigate the impacts of macro volatility and support the industry’s long-term sustainability, it said.
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