South Africa’s MTN service revenue falls, lowers capex target

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MTN Group, Africa’s largest telecommunications operator, has disclosed an 18.8% decline in its first-quarter service revenue, largely influenced by the poor performance of its significant subsidiary, MTN Nigeria (MTNN). Despite the downturn, MTN Group maintains a substantial subscriber base of 288 million across 18 markets in Africa.

For the first quarter ending March 31, 2024, MTN Group reported a service revenue drop to 42.9 billion rand ($2.34 billion) from 52.8 billion rand in the previous year’s corresponding quarter. While South Africa’s service revenue grew marginally by 3% to 10.4 billion rand, Nigeria’s revenue plummeted by 52.8% to 10.2 billion rand.

Reported group earnings before interest, tax, depreciation, and amortization (EBITDA) fell by 28.7% to 17.2 billion rand but rose by 3.9% in constant currency. However, reported EBITDA margin declined by 5.8 percentage points to 37.9%, mainly due to rising costs and currency depreciation, particularly in Nigeria.

MTN Nigeria reported revenue growth of 32.5% to N752.9 billion in Q1 2024 compared to the same period in 2023. Despite this, the company experienced a pre-tax loss of N575.69 billion, attributed primarily to exchange rate depreciation and incurring significant foreign exchange losses amounting to N656.3 billion.

Source: Reuters

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