MTN Nigeria to lose 70% of profit to shareholders, as digital revenue slump slows growth

MTN Nigeria will be losing over 70% of its profit after tax (PAT) to investors holding the company’s stock, as they are set to cash out N212.70 billion from the profit made in twelve months of 2021, according to analysis of it’s Full Year 2021 financial statements.

The y’ello network had reported it generated N1.64 trillion revenue in 2021 FY [against 2020’s N1.34 trilluon], out of which is N298.65 billion profit MTN Nigeria recorded last year.

Ripples Nigeria analysis showed that MTN Nigeria will only be retaining N85.95 billion from its N298.65 billion PAT after its dividend payout, with shareholders projected to receive N13.12kobo per share of 2 kobo each as final dividend.

This showed that the cost of holding investors’ equity capital is hurting MTN Nigeria’s profit [retaining just 28.7% of 2021 profit], considering shareholders received N133 billion as total dividend in the corresponding period of 2020.

Digital revenue slows MTN Nigeria turnover growth

While MTN Nigeria revenue grew 23% last year, when compared to 2020 turnover, the growth was still held back by fall in digital revenue, which included Bulk SMS and USSD services.

READ ALSO: Airtel Africa displaces MTN Nigeria as most capitalised telco, as y’ello shareholders lose N234.07bn

Digital revenue stood at N18.04 billion as of December 31, 2021, falling short of the N37.03 billion generated from the segment during the corresponding period in 2020.

But MTN Nigeria reported growth in Data service, which provided the telco with N516.21 billion in FY 2021, surpassing the N332.37 billion generated during the same period in 2020.

Revenue from Voice service climbed to N819.74 billion in twelve months of last year, in contrast to the N766.38 billion generated during the year before.

Also, SMS followed the same upward path, as MTN Nigeria made N46.40 billion from the service in 2021, which excludes inbound roaming SMS, against the N12.33 billion the network provider reported for 2020 FY.

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