MTNN half-year revenue rises, helped by data income, but soaring costs hurt profit

MTN Nigeria Communications PLC, the Nigerian unit of Johannesburg-based multinational wireless operator MTN Group Limited, Wednesday declared it grew its half-year 2020 revenue by 12.5% to N638.075 billion, relative to the N566.994 billion reported in the same period of last year.

The upward drift was particularly boosted by a leap in data income, which climbed to N154.082 billion, 57.6% bigger than its figure for the first half of 2019, standing at N97.51 billion, Ferdi Moolman, its chief executive said in a note, citing a surge in the number of data users and traffic during the government-imposed coronavirus lockdowns.

‘Revenue from digital and fintech services rose by 121.8% and 29.6% respectively, while voice revenue growth was 2.8% amidst a change in traffic pattern following the lockdowns. ‘However, costs also increased leading to an overall decline in profit before tax and earnings per share,’ he added.

Nigeria contributes about one third of the MTN Group’s revenue and is responsible for approximately 35% of its total market share.

MTNN said last week it saw its profit margin falling by around half a percentage point this year due to instability in Nigeria’s exchange rates.

Earnings before income tax, depreciation and amortisation increased by 8.2% from N302.368 billion to N327.061 billion

Read also: MTNN expects fall in profit amid forex rate volatility

Profit for the period slipped by to N94.877 billion from N99.537 billion, reflecting a margin of 4.7%, figures from the telco’s unaudited interim financial statements posted on the website of the Nigerian Stock Exchange (NSE) showed.

Earnings Per Share (EPS) was marginally lower at N4.66 relative to the N4.89 reported in the same period of 2019.

With outstanding shares approaching 20.355 billion units, MTNN’s market capitalisation is N2.400 trillion on Thursday, making it Nigeria’s second biggest company by market value.

Bloomberg puts its price to earnings ratio at 12.18 and its EPS at N9.68.

MTNN closed trade on the floor of the Nigerian Stock Exchange on Wednesday at N117.90 per share.

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