MTN Group’s Foundations boost efforts to combat COVID-19

MTN Group has boosted its MTN Foundation’s contribution to support efforts in combatting the spread of the COVID-19 pandemic across its footprint. The initiatives include contributing towards Government Relief Funds, the procurement and sourcing of vital Health Care Resources, Food and Water Security through the provision of food packages and water points to meet basic needs, and the Economic Upliftment of SMMEs and local market value chains.

The COVID-19 global pandemic is already the most severe human tragedy of our generation. While the exact consequences, including those of a socio-economic nature, cannot be accurately estimated at this stage, we know that the health emergency is to be followed by social and economic emergencies, both globally and across our markets.

The vulnerable in our societies will suffer the most during this crisis, both in the short and in the long-term, and we have identified food insecurity to be the most pressing as well as the most disruptive risk to our societies.

Across the continent and beyond, national governments have set up relief funds aimed at supporting those in the greatest of need. MTN Group has contributed a monetary value of R42 million in a number of markets for Government Relief Funds in response to COVID-19 efforts. The funding is for the support of the unemployed, small and large businesses and the procurement of essential goods such as food and medicine which positively impacts the economic upliftment of societies.

In line with MTN Group’s commitment towards minimising the spread of the virus, MTN has supported the provision of 130 500 Personal Protective Equipment (PPE) and 10 000 virus testing kits. Through the donation of food packs and the provision of water points, approximately 46 000 people have access to vital food and water during these trying times. Through these efforts and our support for Government Relief Funds, we have invested R70 million towards ensuring communities are supported.

Nompilo Morafo, Group Executive Corporate Affairs, says: “MTN, as a leading brand in the markets in which we operate, believes that we have a  key role to play in assisting to minimise the likelihood of transmission and its impact on society. We are incredibly  proud of the level of resilience that the communities have demonstrated across our operations as they fight against the challenges that COVID-19 brings.

Africa and the Middle East have always been cultures defined by ingenuity, entrepreneurship, and positivity. We believe the more we can do to address our communities’ essential needs, the more time they can use to focus on this resilience and innovation potential that will be at the heart of social and economic recovery.”

Since COVID-19 has transformed the world we live in there have been countless inspiring stories of ingenuity as people find new ways to operate and contribute to the recovery. African laboratories and tech companies have developed rapid testing kits, mobile tracking apps and medical drones. In some countries radio, web solutions and apps are delivering education to students who would otherwise be cut off from school and across the continent businesses are redesigning their production lines to manufacture much needed ventilators, sanitizers and PPEs. As we rebuild and reshape our economies, innovation will be the game changer.

We are committed to leveraging our core capabilities to enable this process, underpinned by our core belief that everyone deserves the benefits of a modern, connected life and that connectivity can play a unifying role.

The COVID-19 pandemic as a global health and societal emergency requires effective and immediate action by governments, individuals and businesses. It is critical that we collectively respond with one unified voice and take the necessary measures to make a meaningful contribution to society.

MTN Group reports continued commercial momentum in the first quarter

MTN Group today announced a positive service revenue trajectory in the first quarter financial results for the year ended 31 March 2020

Speaking on the results MTN Group president and CEO, Rob Shuter said: “The effects of the COVID-19 pandemic on the global economy have brought about unprecedented uncertainty, volatility and challenges which are impacting our markets at both the socio-economic and macro-economic levels. The impact of the pandemic on our quarter one performance was not significant as lockdown restrictions for our consolidated subsidiaries were only implemented from the last week of March 2020.

We continued to build commercial momentum adding 6,6 million subscribers in the quarter, with active data users increasing by 2,9 million and MoMo subscribers by 0,4 million. We continued to scale our Ayoba platform recording 2,6 million monthly active users. We accelerated our MoMo agency network in Nigeria, under our super-agent licence, adding 70 000 agents in the first quarter, bringing the total number of registered agents to 178 000.

On strategic progress, the digital business returned to growth, booking 15.6% in the quarter. In MTN SA the enterprise business recorded its second quarter of growth and in May we commenced phase 2 of the national roaming agreement with Cell C and look forward to a continued partnership.

In these difficult times we continue to focus on our key priorities: looking after our people, our customers and our networks while we focus on efficiencies. For our people, the immediate priority is their health and safety, where the work-from-home programmes across our markets empower our staff to work remotely while ensuring continuity in our operations. For our customers, we have ramped up our digital channels as a service alternative, to enable them to continue purchasing airtime and accessing our products and services seamlessly as well as launching Y’ello Hope Packages in most of our markets.

Our various initiatives support governments across our markets with communication systems and connectivity as we do our part to help minimise the economic and social impact.

The COVID-19 situation is an evolving one and will undoubtedly impact the year ahead. Given the uncertainties associated with the duration and economic impact of the pandemic, it is difficult to reliably quantify the direct and indirect financial impacts on the business at this early stage. The group will continue to focus on business continuity and efficiency, and we have implemented strict measures to preserve resources and strengthen our resilience.”

Financial Performance

For the first quarter, MTN delivered a solid performance increasing constant currency service revenue by 11,1% and EBITDA by 15,6% with EBITDA margin improving by 2,1pp to 43,2%, in line with medium-term targets. The group recorded voice, data and fintech revenue growth of 6,3%, 26,4% and 26,0% respectively as we continued to execute on our strategic objectives and progress toward becoming a digital operator. Digital revenue has returned to growth, increasing by 15,6%.

MTN Group CFO, Ralph Mupita concluded, “We are encouraged by the service revenue growth of 11.1% which we achieved on a constant currency basis, this translated to 16.5% on a reported basis. Good cost control across the group supported the increase in group EBITDA margins, with a particular strong performance from MTN Ghana. Notwithstanding the impacts of COVID-19 in the first quarter, the balance sheet remained resilient and our cash and committed undrawn facilities was approximately R45 billion at the holding company level, providing us with sufficient liquidity during these uncertain and unprecedented times.

We have experienced a continued surge in data traffic during the month of April, but voice traffic and mobile money transactions were under pressure given various lockdown measures taken across markets. Where lockdown measures have been lifted or relaxed recently, voice recharges and mobile money transaction volumes have improved. For now, we are maintaining our 3 – 5 years medium-term guidance but will update the capital markets in August of any changes when we release our H1 2020 results.”

Looking ahead

The current environment is marked by significant uncertainties. It is still too early to assess the economic impact of the pandemic on our customers and reliably quantify the direct or indirect financial effects on our business. The remainder of the year will be shaped by the ramifications of the pandemic, and we will continue to update all stakeholders as the effects become clearer.

We are not only focused on managing the risks brought about by COVID-19, but also on the opportunities it creates in the accelerated digitalization it has brought about. We believe we are well positioned as a company to benefit from this evolution, especially given our focus on growth in our data, digital and financial services businesses. The Group remains focused on the execution of our BRIGHT strategy to deliver sustainable growth in our operations and value to our stakeholders.

MTN Asks U.S. Court to Dismiss Anti-Terrorism Case

MTN Group (MTN) has asked a United States court to terminate the case filed against it on December 27, 2019, asserting claims for civil monetary relief under the U.S. Anti-Terrorism Act.

As stated in the formal written document submitted to the U.S. court by MTN’s legal counsel, entitled a “motion to dismiss,” MTN requested the court to end the lawsuit and grant a judgment in MTN’s favour for two independent reasons: because the court lacks jurisdiction over MTN, which does not operate in the United States, and because the complaint does not allege any conduct by MTN that would have violated the Anti-Terrorism Act.

Under U.S. law and procedures, MTN is not permitted at this stage of the lawsuit to challenge or contest the factual allegations made against the company, so the motion to dismiss focuses on the lack of jurisdiction and the legal insufficiency of the claims.

MTN has deep sympathy for those who have been injured or lost loved ones as a result of the tragic conflict in Afghanistan. As stated in the motion to dismiss, however, “the MTN Defendants are not the extremists that caused Plaintiffs’ tragic losses and injuries. To the contrary, MTN Afghanistan has been lauded by the World Bank for expanding telecommunications services to the impoverished people of Afghanistan and has itself been a target of violence in the devastating conflict in that war-torn country. Put simply, Plaintiffs have sued the wrong defendants in the wrong court based on insufficient allegations.”

MTN remains of the view that it conducts its business in a responsible and compliant manner in all its territories and, as reflected in the motion to dismiss, intends to defend its position accordingly.

MTN Group Announces R250m Relief Package to Tackle COVID-19 Pandemic across its operations

MTN Group today announced details of its R250 million relief package in response to the COVID-19 pandemic.  Operating across 21 markets MTN Group has customised its response to recognize its responsibility to contribute both in its home market South Africa as well as in many other markets facing enormous challenges managing the pandemic. Comprising five key intervention initiatives, the Group has focused on employees, customers, vulnerable groups, contributions to the South African Government’s Solidarity Fund and participating in industry interventions.

“We believe it is the responsibility of all organisations to assist where they can during the pandemic.  MTN plays a vital role in the mobile and telecommunications industry across Africa and the Middle East and it is vital that we assist our employees, customers and stakeholders during this difficult time,” said Mcebisi Jonas, the Chairman of MTN Group. Believing that charity “begins at home”, the Group plans to raise R40 million for the MTN Global Staff Emergency Fund for employees in need.

The funds will be raised by contributions from the Group’s directors, managers and general staff. The Chairman, Group CEO, Group CFO and a number of MTN Group directors have pledged 30% of their board fees and salaries for the next three months. The executive teams of both MTN Group and MTN South Africa have also contributed to the fund. In addition, other staff members can also contribute by making salary sacrifices.

Furthermore, over R150 million will be invested in the Y’ello Hope Package for customers – that includes free SMS services, the waiving of fees for certain mobile money transactions, discounted calling during off-peak periods, zero-rating of certain health, social services and educational sites and payment concessions to our business customers. “Utilising our services and technologies for the greater good is key at the moment.  We can positively impact millions of lives and our main focus is on keeping our network in good working order and enable our customers to connect with their loved ones during this most difficult time for all,” said Rob Shuter, MTN Group President and CEO.

MTN is also mobilising the work of the MTN Foundations across the markets to reach those most vulnerable through contributions towards tackling health emergencies to minimise the spread of COVID-19 (Disease Commodity Packages and ICT services needed for Health Ministries and Health professionals); and enabling students to remain productive by accessing vital school and university content with a total contribution of at least R50 million.

MTN was born at the dawn of South African democracy and owes its heritage to the place of its birth.  MTN Group will also contribute R10 million to the South African Government’s Solidarity Fund. MTN will also leverage its knowledge and infrastructure in the continued participation in the many forums that have been set up to assist those in need.

 

MTN Group ranked Africa’s top telecoms brand

MTN has been awarded the most valuable telecom brand in Africa in a recent annual report by Brand Finance, a leading independent brand valuation consultancy. The report stated that MTN’s brand value was boosted by a solid overall performance for the year, despite challenging economic conditions and regulatory challenges in some markets.

Brand finance also recognised MTN for its focus on customers and providing a high-quality service across all its markets. “Amid these unprecedented times in fighting a global pandemic, MTN Group is humbled by the Brand Finance recognition and our progress in rising up through the ranks of this year’s Telecoms 150 report” said MTN President and Group CEO, Rob Shuter.

Brand Finance CEO, David Haigh commented: “MTN is to be commended for its performance in its home market as well as further afield. They are increasingly recognised throughout Africa by their customers as providing high quality service, because their brand image is deeply rooted on more than just marketing campaigns”

Brand Finance acknowledged MTN’s BRIGHT strategy to grow revenues through data and digital, while also focusing on growing its subscriber base. It upgraded MTN’s brand strength rating from AAA- to AAA, in recognition of an increasingly strong leadership position in telecommunication services throughout Africa and the other markets within which it operates, as well as increasingly resilient network investments.

The report noted a negative global impact on the brand value of the world’s biggest telecom companies which are set to be impacted by the Coronavirus outbreak.  “We have built a sound, robust and resilient organisation that can and will weather the storm before us. As a Group, we are taking the decisive steps required to persevere in our MTN spirit of togetherness and a positive, can-do attitude,” concluded Shuter.

 

MTN Group releases 2019 integrated, sustainability and tax reports

MTN Group today published its Group Integrated, Sustainability and Tax Reports for the year ending 31 December 2019, illustrating the significant economic and social impact it has delivered through the group to the markets it operates in across Africa and the Middle East. The three reports set out how the company delivered growth and unlocked value by continuing to focus on executing its BRIGHT strategy. They also show how MTN operations strive to ensure that all who are touched by our products and services are positively impacted.

Delivering on our strategy in a more agile way

Our 2019 Integrated report highlights the progress we have made against our strategy and the value created by developing and distributing a range of innovative and reliable communication products and services. We also share our intention to harness the pioneering spirit MTN has built over the last 25 years to accelerate the implementation of our strategy in a more agile way in close collaboration with our many partners, with whom we are #GoodTogether.

Key highlights:

  • The work we have done on strengthening our operations and balance sheet over the last few years positions us well to weather the more turbulent operating environment.
  • Given the progress and momentum we have seen in our commercial, strategic and financial initiatives, we have enhanced our medium-term guidance framework.
  • While we maintain our service revenue growth, EBITDA margin improvement, capex intensity reduction and ROE improvement targets, we have increased our targets for the next three to five years to secure at least a further R25 billion in asset realisations which will further moderate our leverage ratios.

Contributing to infrastructure and government revenue

The infrastructure we build supports the development of the technology which boosts local economies. MTN invested R26 billion in its networks and systems in 2019. MTN is also among the largest taxpayers in many of our markets and MTN’s tax contributions for the year under review amounted to R31 billion, up from R24 billion in 2018. Tax contributions include corporate taxes, indirect taxes, withholding taxes, payroll taxes, operating licence fees and other payments to government authorities.

This stemmed from contributions made in South Africa of R4,6 billion, Nigeria of R6,7 billion, SEAGHA of R9,3 billion, WECA of R6,7 billion and MENA of R3,2 billion.

PwC Building Public Trust Award

Our 2018 tax report was selected from the tax reports of the top 100 JSE listed companies. An independent panel of judges reviewed the tax reports and MTN was awarded first place for the PwC Building Public Trust Award amongst South African based multinational companies. This award is given for excellence in tax reporting.

Driving broader socio-economic benefits to society

“To make an impact on meeting the UN SDGs by 2030, we need to deepen our focus, acting collectively and decisively. Having often reflected on this objective, I believe we can achieve this if we come together through our connected and shared humanity to collaborate effectively through partnerships,” said MTN President and Group CEO Rob Shuter.

“What we are most proud of are the partnerships we have made and the impact they have had. Three in particular come to mind: 1) Rapid rural roll-out programme (R3) with our various partners, in 2019 we saw over 1300 sites reaching 6,9 million people, 2) Internet Watch Foundation partnership to make children safer online, we successfully blocked 2 million URLs containing child sexual abuse material, 3) Signing up to the GSMA-led industry-wide plan to achieve net-zero GHG emissions by 2050  in line with the Paris Agreement.”

We view sustainability as an integral part of MTN’s value creation journey now and into the future. We strive to create and protect shared value for our stakeholders through responsible economic, environmental and social practices. Key points from the 2019 Sustainability report are as follows:

  • Environmental: MTN recorded its highest ever greenhouse gases saved/avoided at 28 889 tonnes of carbon dioxide equivalent (tCo2e) in 2019, despite an increase in our energy consumption due to the growth in our network.
  • Social: We reached over 1,9 million beneficiaries through our Corporate Social Investment across our footprint, over 400 000 of which were women and over 300 000 youth.
  • Governance: MTN adheres to a culture of sound ethical business conduct – over 10 000 ethics e-learning completion by staff, over 1 800 vendors prequalified following due diligence process and over 130 calls to tip-offs anonymous whistle-blower line, a significant increase from previous years.
  • Economic: Through our CHASE model, we are driving smartphone adoption with over 675 000 affordable low-cost smartphones distributed in 2019 alone. We also witnessed a 39% reduction in the group’s effective rate per megabyte.

Rob added that: “Access to the internet has the power to change lives and bridge inequalities, we are contributing to accelerating digital and financial inclusion by connecting the unconnected. We believe that by contributing to the prosperity of Africa and the Middle East, we are creating shared value for all.

Another key example of this: MTN’s Mobile money and Homeland solutions which are not only facilitating the flow of money into Africa from the Diaspora, but between different regions in Africa, setting the stage to enable African Continental Free Trade Area’s vision of creating a single market across the African continent.” 

MTN’s response to COVID-19

As business and society, we are seeing a concerning increase in the transmissions of COVID-19 cases across multiple countries. To mitigate its impact, we are implementing several measures to support our employees, customers, partners, communities and our business during this time of uncertainty for all of us. These measures include the establishment of a Global Staff-Care Emergency Fund which will be utilised for preventative health and safety, treatment, and emergency lockdown sustenance provisions. We are also rolling out relief products and services under the ‘Y’ello Hope Crisis Package’ umbrella across MTN to enable customers to access critical health and education information, and mobile money services. Our investment focus at this time is on resilience and capacity in our networks.

“As I write, we are in the midst of the COVID-19 pandemic and there is much uncertainty as to how and when society will emerge from it. The impact of COVID-19 on worldwide economies is challenging and our commitment remains steadfast to do all we can to minimise the economic and social impact across our markets. MTN Group cares because MTNers care – we have dynamic and passionate employees who continue to empower us to reach new heights in our journey,” concluded Rob.

Click here to access the reports.

MTN ramps up efforts to support customers and communities as COVID-19 spreads across markets

As business and society, we are seeing a concerning increase in the transmissions of COVID-19 cases across multiple countries. The virus has had a far-reaching impact on our societies and is testing the resilience and tenacity of businesses and individuals alike. Globally, governments and companies are ramping up efforts to help mitigate the spread of the virus. In MTN’s footprint 17 of our 21 markets have COVID-19 infections.

“MTN’s priority is keeping people connected during this period.  We need to play our part in the alleviation of the economic, social and educational impact through the support of key institutions such as Health and Education.  Driven by our belief that everyone deserves the benefits of a modern connected life, we have started rolling out a series of mobile connectivity, digital and mobile fintech solutions for communities across MTN’s markets,” said Rob Shuter, President and CEO of MTN Group. The solutions are aimed at achieving the United Nation’s Sustainable Development Goals and to ensure that the macro impact of COVID-19 does not hinder people’s ability to stay connected.

Social distancing amongst other precautionary interventions undoubtedly increases the importance of communities staying digitally connected, particularly to news about the latest developments of COVID-19.  Now more than ever, MTN will play its part in using its capabilities and technologies for the good of humanity.

We are also ramping up the roll-out of relief products under our Y’ello Hope package including the supporting of governments and other stakeholders to convey vital information via mobile & digital platforms to keep people safe. Offering the zero-rating of school and university sites to enable learners to access core curriculum and facilitate distance learning and zero-rating some transactions on our Mobile Money platforms in a number of our markets.

MTN operations have already implemented measures aimed at curbing the spread of the disease and easing data costs for communities, examples below:

MTN South Africa:

  • Has zero-rated a USSD line for reporting infections and for other critical information.
  • There are also two zero-rated Ayoba COVID-19 channels that are already live and are sharing updated news and information.
  • As part of MTN SA’s response to the Competition Commission’s Data Service Market Inquiry, the company also announced that with immediate effect, concerned family members and friends can stay in touch through a free 20MB Ayoba Data Lifeline that can be accessed via the Ayoba app.
  • The Mobile Money (MoMo) app, will allow for free peer-to-peer cash payments under R200 effective 24 March 2020.

MTN Nigeria:

  • In the coming days, MTN Nigeria will introduce its Y’ello HOPE package – several new measures as part of a concerted effort to support customers. These include further amplifying governments sensitisation efforts – using more channels to deliver health and safety information.
  • Suspending fees for all money transfers using their Momo Agent network.
  • The company also plans to announce the temporary closure of some of its stores.
  • MTN Nigeria continues to engage and is actively pursuing new ways to leverage its core expertise, technology and infrastructure to support the Nigerian Government’s efforts to keep citizens safe.

  MTN Ghana:

  • MTN MoMo customers can now send money transfers values up to GHS100 daily to MoMo wallets and other networks for free.
  • The company has zero-rated a number of education sites to support online learning. It has also zero-rated the Ghana Health Service’s website so that users can access information about the virus free of charge.
  • They also use their digital channels to provide hygiene tips and update customers on the virus and the company’s response to it.
  • MTN Irancell has reduced data costs by 60 % for educational websites, it sends awareness messages via SMS and provides access to value added service content at discounted prices. The company also supports health care workers by providing them with free calls;
  • MTN Sudan, in collaboration with their Ministry of Health, has sent awareness messages to customers via SMS;
  • MTN Uganda has waived fees on its mobile money transfer service for every transaction below UGX30,000 for 30 days;
  • MTN Rwanda has waived fees on mobile money transactions for the next 90 days;
  • MTN Zambia has waived fees on mobile money transfers up to K150, has doubled the mobile money transaction limits and will give an allocation of FREE SMSs to customers;
  • MTN Cameroon has suspended the payment of fees on money transfers between MTN MoMo accounts, for amounts of up to 20, 000 FCFA, for the next 30 days.

These initiatives are ones that have been activated thus far. We expect more momentum over the coming weeks with other affected markets rolling out similar initiatives aimed at addressing their communities’ needs during this period. We will continue to update our stakeholders accordingly as and when additional activities go live.

Access to information is a priority and we remain committed to providing all our 251 million customers and stakeholders with superior products and services in the face of adversity.

MTN South Africa announces outcomes from engagements with the Competition Commission

Further to the announcements on 4 December 2019 and 12 December 2019, MTN SA has today announced the outcomes from its engagements with the CompCom and response to its Data Service Market Inquiry. MTN SA has developed a set of voluntary undertakings in the form of a social compact to further address the affordability of data services for its customers and MTN remains in discussion with the CompCom on the options to formalise these elective solutions and the implementation thereof.

Included in these initiatives are three areas which focus on deepening MTN’s ongoing drive to reduce the cost to communicate. These are: the affordability of monthly prepaid bundles, lifeline data and the zero-rating of data for public benefit service websites.

Click here for further details: https://www.mtn.com/investors/shareholders/sens/category-sens/?sens_year=2020

MTN completes the sale of ATC joint ventures for R8,9 billion

Our asset realisation programme (“ARP”), introduced in March 2019, aims to reduce debt, simplify our portfolio, reduce risk and improve returns.

Subsequent to MTN Group’s announcement on 11 March 2020 reporting its 2019 annual results and the conclusion of the disposal of its stake in ATC Uganda for R2,2 billion, MTN confirms that regulatory approvals have now been received for the disposal of its stake in ATC Ghana. MTN is due to receive further transaction proceeds of approximately $384 million (R6,7 billion, based on an exchange rate of R17,4:$1) in the next week. This takes the total proceeds received for the disposal of both ATC Uganda and ATC Ghana to R8,9 billion, which will be applied to paying down US-dollar debt and general corporate purposes.

Click here for further details: https://www.mtn.com/investors/shareholders/sens/category-sens/?sens_year=2020

MTN reports strong financial results and CEO succession process underway

MTN reports commercial momentum, strategic progress and strong financial results; CEO to step down next year, succession process underway

MTN Group today announced an encouraging set of results for the year ended 31 December 2019 and that group president and CEO Rob Shuter would be stepping down from his role at the end of his contract in March 2021.

Commenting on the results, Shuter said:

“In 2019, the 25th anniversary of MTN Group, we delivered commercial momentum across our operations as well as great progress in our strategy and strong financial results, despite challenging trading conditions.

We added 18 million customers to reach a total of 251 million and increased our data users by 17 million to 95 million and our fintech customers by 7 million to 35 million. This growth is central to our belief that everyone deserves the benefits of a modern connected life. We also saw improvements in customer experience, network quality and market share across the group.

On the strategic front, we launched our instant messaging platform Ayoba, which is now live in 12 markets with two million monthly active users. We launched MoMo in South Africa and Afghanistan and received our super-agent licence in Nigeria, registering more than 100 000 agents by year-end. We also delivered R14 billion of asset realisations within the first 12 months of our programme and MTN Nigeria listed on the Nigeria Stock Exchange. We recorded progress on various regulatory issues, including the AGF tax matter in Nigeria. Relationships with stakeholders across our markets improved, and we reported our highest employee sustainable engagement score yet.

On the financial side, we delivered service revenue growth of 9,8% with an acceleration in the second half. Our EBITDA margin improved and reported headline earnings per share grew by 62%. Our network rollout brought a further 69 million people into 4G coverage whilst reducing capex intensity.  Improved cash flows during the year supported stable balance sheet ratios.”

Operating environment

This outcome was delivered against challenging macroeconomic conditions, particularly in South Africa, with muted economic activity and the rand weakening against the US dollar.

Financial performance

In constant currency terms, group service revenue increased by 9,8%* to R141,8 billion and earnings before interest, tax, depreciation and amortisation (EBITDA) expanded by 13,6% to R53,4 billion. The holding company leverage ratio improved to 2,2x, which is well within the group’s guidance range of 2,0 to 2,5x, and we reduced our capex intensity to 17,5% from 19,3%, indicating greater efficiency in deploying assets. Driven by the strong earnings performance, operating cashflow increased by 18% and the ROE increased from 11,5% in 2018 to 14,3% in 2019 on an IAS17 basis.

The group’s results were supported by double-digit growth in service revenue by both MTN Nigeria and MTN Ghana. The performance of MTN South Africa was impacted by economic pressure, new data usage rules and changes in recognition criteria for roaming revenue from Cell C due to delayed payments under the networking roaming agreement.

Management succession

MTN announced that the group president and CEO Rob Shuter will be stepping down from his role at the end of his contract in March 2021. The board thanks Rob for the contribution he has made, and continues to make, to MTN. The succession process will be concluded during the year, enabling a seamless handover.

MTN group chief technology and IT officer Charles Molapisi has been appointed to the group executive committee and the fixed contract of the group chief operations officer, Jens Schulte-Bockum, has been extended until 31 March 2022.

Looking ahead, Shuter says:

“We are well positioned for growth. Guided by our well-defined BRIGHT strategy, we are building our growth strategy on our digital operator model while optimising efficiencies, capex and cashflow.

Following data price reductions in South Africa and Nigeria in 2019, we expect price elasticity to improve data revenue growth in 2020, supported by expanded 4G coverage in Nigeria and across the group. We will continue to scale up our fintech and digital services as well as grow our enterprise and wholesale businesses.

We have maintained our service revenue, EBITDA margin, capex intensity and ROE targets and increased our asset disposal target by a further R25 billion over the medium term. We also now target a holding company leverage ratio at below 2x. We will use 2020 to implement our succession process and ensure a seamless handover to the new group president and CEO whilst maintaining our operational execution.

Inspired to harness the pioneering spirit that has built MTN over the last 25 years, we remain committed to delivering on our strategy in a more agile way in close collaboration with our many partners, with whom we are #GoodTogether.”

Further reading