Business 8.8.2018 09:50 am

MTN profit drops despite increase in subscribers

An MTN shop. Photo: Supplied

An MTN shop. Photo: Supplied

The company says it has 223.4 million subscribers compared to 217.2 million it had at the end of 2017.

South Africa-based multinational mobile telecommunications company MTN said on Wednesday its headline earnings per share for the six months ended June 30 dipped to 215 cents from 231 cents, while service revenue was up 10.2%.

The company, which now has 223.4 million subscribers compared to 217.2 million at the end of 2017, saw an improvement in operational performance across many markets, led by Nigeria, Ghana and South Africa, group president and CEO Rob Shuter said.

Service revenue growth increased, driven by robust voice revenue growth and the continued expansion of data and digital revenue. This, in turn, was supported by a 2.8% increase in subscriber numbers, continued network rollout, increasing 3G and 4G population coverage and improving customer service.

Shuter said MTN had resolved key regulatory issues in Cameroon and Benin, launched the initial public offering (IPO) of MTN Ghana and made progress on the IPO of MTN Nigeria. As part of its ongoing portfolio review, the group agreed to the sale of MTN Cyprus.

“In the period, we further strengthened our governance of risk, continued to boost our specialist skills base, recorded improvements in employee engagement and extended mobile internet access to more people,” he said.

“Despite continued challenges in repatriating funds from MTN Irancell, the board remains committed to plans to declare a total dividend of 500 cents per share for 2018 and is targeting growth of 10% to 20% over the medium term.”

MTN said while macroeconomic conditions remained challenging in South Africa, Iran and Cameroon, they were supportive in Nigeria, Ghana and Uganda.

In the next few years the company expected to widen its group earnings before interest, taxes, depreciation, and amortization (EBITDA) margin and targeted upper-single-digit growth in constant currency service revenue, driven by double-digit growth from MTN Nigeria and mid-single-digit growth from MTN South Africa.

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