Regulatory actions exact a toll on MTN’s subscriber numbers
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MTN SAW THE number of its subscribers fall by 2.3 million to 277.3 million in the six months to June 30 due to new SIM registration requirements in Nigeria, while the group will abandon its Syria operation due to regulatory factors.
Excluding Nigeria, subscribers for the pan-African group that operates in 21 markets were up 5.4 million.
Despite a lifting of a ban on new SIM activations in April 2021, new subscriptions in Nigeria remained muted, owing to new registration requirements, but were expected to normalise over time, the group said yesterday in its results for the six months to June 30.
Regulatory actions and demands had made operating in Syria “untenable”, MTN Group president and chief executive Ralph Mupita said in a statement. “We reserve our rights to seek redress through international legal processes given the actions of the Syrian authorities that have left us with no other choice than to exit.
MTN Syria represented less than 1 percent of the group’s earnings before interest, tax, depreciation and amortisation (Ebitda) at the end of 2020. In line with the focus on Africa, options to exit Yemen and Afghanistan were being explored. A bid for a licence in Ethiopia would also not be resubmitted.
“Our April 2021 bid for a new telecoms licence in Ethiopia was unsuccessful. Our bid took into account licence conditions as well as related uncertainties. We had also adopted a partnership approach to ensure that funding and risk was diversified.
“The group has decided not to participate in the new liberalisation processes under way in Ethiopia,” said Mupita.
Headline earnings per share (Heps) fell 10 percent to 387 cents in the six months, after non-operational factors lowered the figure by 118c per share.
Non-operational and once-off items that impacted Heps included accounting adjustments related to the Middle East portfolio as well as Covid19 donations to the AU for vaccines and the Coalition Against Covid-19 in Nigeria. Excluding these, adjusted Heps increased by 31.5 percent.
Avior Capital Markets analyst Michael Steere said the results were better than expected.
The share price continued its upward trajectory this year, rising 4.67 percent to R120.63 by midday yesterday from Tuesday’s close, and just more than double the R60.09 that the share price closed at on December 31, 2020.
Group service revenue grew by 2.1 percent, well down from the 19.7 percent growth in the comparable period last year. In constant currency terms, service revenue increased 20 percent to almost R82bn and earnings before Ebitda before once-off items increased by 24 percent to nearly R39bn.
The number of Active Mobile Money (MoMo) customers increased by 27.9 percent year-on-year to 48.9 million.