MTN Nigeria comes out swinging

MTN Nigeria comes out swinging

Company resolute on Attorney General matter and says it delivered a solid performance in results for six months ended 30 June 2019.

MTN Nigeria says it remains resolute it has not committed any offence and will continue to defend its position related to the ongoing tax battle with the country's attorney general.

In a presentation of its unaudited results for the six months ended 30 June 2019, MTN Nigeria said the hearing on matter has been adjourned to 29 and 31 October 2019.

In September 2018 the country's auditor general issued MTN Nigeria with a US$2-billion tax bill, to which the company responded that the auditor general had exceeded his powers and the claim was without merit.

According to its results the company increased the number of data subscribers by 2.1 million to 20.7 million during the period under review, and added 3.3 million customers to its network – increasing its subscriber base to 61.5 million.

While the company experienced an increase in service revenue by 12.2%, as well as increases in voice and data revenue by 11.4% and 31.7% respectively, its digital revenue decreased by 64.5%.

EBITDA grew by 40.0% to N304.9 billion (IAS 17: 16.2% to N253.0 billion) and EBITDA margin increased by 10.7 pp to 53.8% (IAS 17: 44.6%, up 1.5pp). Its Capex increased by 63.8% to N105.8 billion (IAS 17: 48.9% to N96.1 billion).

MTN Nigeria chief executive officer Ferdi Moolman said: "In the first half of 2019, we sustained a solid performance, delivering double-digit growth in service revenue, underpinned by growth in voice and data revenue. We made significant network investments to improve network quality and expand our 4G coverage. Our recent work to revamp our data prices and accelerate our 4G network has put us in a strong competitive position to offer more value to our customers, supporting data and voice revenue growth which will ultimately strengthen our business."

Moolman mentioned the significance of the company's listing in May on the Nigerian Stock Exchange (NSE).

The move, however, was not without controversy and in the same month it was reported that the company was under investigation by the Nigerian Economic and Financial Crimes Commission.

An ITWeb report stated that according to Bloomber, the Commission requested certain information pertaining to the listing.

Moolman added that the company had secured a super-agent licence from the Central Bank of Nigeria "which will enable us to build an agent network and accelerate the growth of our FinTech business."

FinTech revenue increased by 21.2%, according to the results.

"Our FinTech business continued to gain momentum with 21.2% growth in revenue YoY. The super-agent licence will allow us to leverage our established distribution channels to offer a wide range of mobile financial services. We will continue to work towards obtaining a payment service banking licence that we applied for in late 2018. Digital revenue continued to be impacted by the optimisation of value-added services (VAS). However, our focus is to build a sustainable base of active digital users in order to boost revenue growth. Our enterprise business also delivered satisfactory results, with revenue increasing by 31.3%, to contribute 11.9% to service revenue," the company stated.

Board reshuffle

This week MTN Nigeria announced changes to its Board.

Announced via the NSE, the six directors that have worked with the company since their appointment in 2001 and seen it list will now give way to 14 new appointees comprising 13 directors.

These appointees are scheduled to take over from 2 September 2019.

Ernest Ndukwe, a former Nigerian Communications Commission (NCC) executive director, is the appointed Board Chairman Designate taking over from Pascal Dozie. Four of the six newly-integrated directors have a background in financial services, including Michael Onochie Ajukwu (independent non-executive Director), Muhammad K. Ahmad (independent non-executive director), Andrew Alli (non-executive director) and Ifueko Okauru (non-executive director).