Author: cara

MTN Group today announced it has shown encouraging progress under difficult trading conditions. The Group saw growth of 12% in adjusted headline earnings per share, which is the first time that we have delivered growth in this measure in recent years. Commercially, the subscriber base continues to grow, increasing by a further 7,7 million to now number more than 240 million across operations.

Looking forward the Group is well-positioned to grow by leveraging its scale and enhancing its competitive position as it transitions into a digital operator.

Listen to MTN Group President & CEO, Rob Shuter, commenting on the interim results:

 

MTN is breaking the demographic divide

 

Increasing access to economic and transactional services for all

 

Make a big difference in the continent

 

MTN invested R12 billion in building world-class network

 

MTN Group today announced an encouraging set of results for the six months ended 30 June 2019 in the context of difficult trading conditions across its major markets.

Commenting on the results, Rob Shuter, MTN Group President and CEO, said:

“We had a good first half, reporting solid financial results, good commercial momentum and encouraging strategic progress. We saw growth of 12% in adjusted headline earnings per share, which is the first time that we have delivered growth in this measure in recent years. Our service revenue grew just below 10% and EBITDA just above 10%, both on a constant currency basis. Our holding company leverage remains stable at 2.3x, well within our guidance range of 2 to 2.5x. And, as we grew revenue and carefully managed our investment programme, we saw capex intensity drop further, to 16,9%.

Commercially, we had strong subscriber growth of 7,7 million in the first six months of the year to reach a total of 240 million subscribers.  The number of active data users grew by 3,5 million to 82 million and our 30-day active Mobile Money users grew by 2,4 million to 30 million. Our continued focus on the customer experience has seen us record brand NPSˆ leadership across more than 50% of the portfolio, with 12 markets now leading. That contributed to MTN being named the most valuable South African brand in the Brand Finance South Africa 50 report and the most admired African brand by Brand Africa 100.  

During the period we had some landmark events. We successfully completed the listing of MTN Nigeria on the Nigerian Stock Exchange and our e-commerce joint venture Jumia listed on the New York Stock Exchange. Within three months of announcing our asset realisation programme, which is targeting at least R15 billion over the next few years, we delivered R2,1 billion in proceeds.

Our advanced instant messaging platform, Ayoba, is now live in three of our West African markets and has more than 300 000 active monthly users. We are very pleased with the formal approval of our super-agent licence in Nigeria, which clears the way for the launch of phase 1 of our Nigeria fintech business while we await a banking licence.”

 Operating environment

 In South Africa, the group contended with a weak macroeconomic environment as well as the introduction of new end-user requirements and the repricing of out-of-bundle data rates. In Nigeria, economic activity was muted in the time of presidential elections and prior to the formation of the cabinet. In Iran, the rial weakened sharply after the re-imposition of US sanctions.

Financial performance

Notwithstanding this environment, in constant currency terms, service revenue grew by 9,7% to R67,9 billion and earnings before interest, taxation, depreciation and amortisation (EBITDA) expanded by 10,2% to R31,2 billion. The holding company net debt to EBITDA ratio remained stable at 2.3x, which is well within the group’s guidance range of 2.0 to 2.5x, and capex intensity dropped further to 16.9%, indicating greater efficiency in deploying assets.

Looking ahead, Shuter says:

“MTN is well positioned to grow by leveraging our scale and enhancing our competitive position.

 In the second half, in South Africa we will focus on the continued turnaround of the enterprise business, the recovery of prepaid and the launch of Mobile Money. In Nigeria, we will focus on the further rollout of 4G coverage, the launch of Ayoba and Music Time! as well as accelerating our fintech ambitions by fully leveraging our extensive distribution network to offer a range of transfer and payment services to our GSM customer base.

 Across the rest of the portfolio we have six focus areas. These are: the continued turnaround of our operations in the West and Central Africa region; the resolution of some of the more complicated regulatory situations; the rollout of MusicTime! and Ayoba across the group; the asset realisation programme; launch of our pan-African MTN 4 Good campaign and delivering on our medium-term targets.”

View our Interim results for 2019 here.

MTN is thrilled to announce that it has been named the most admired brand by Brand Africa 100, based on spontaneous consumer responses.

The seventh annual Brand Africa 100 report was released on 24 May 2019, featuring the top 100 most admired brands in Africa.

Ranked number eight in the top 100 most admired brands in Africa, MTN is the only African brand in the top 10, as well as the most admired telecommunications brand on the continent. Furthermore, within the financial services category, MTN Mobile Money is in the Top 20 at number 19, up one position from 2018. MTN is also the overall number one brand in Rwanda and Liberia, and the number one Johannesburg Stock Exchange listed brand in the Brand Africa 100 rankings.

Brand Africa 100 is a pan-African survey and ranking of Africa’s Best Brands developed by Brand Leadership. The rankings are based on a comprehensive survey by Geopoll, a global leader in providing high quality market research in emerging markets, and strategic analysis and weighted consumer admiration ranking by Kantar, the world’s leading data, insights and consulting company and Brand Leadership, Africa’s leading branding and integrated marketing communications advisory.

The 2018/19 study surveyed consumers from 25 countries in Africa (12 of which are MTN markets). Together these countries represent 85% of Africa’s population and 85% of GDP.

Commenting on the accolade, Bernice Samuels, MTN Group Executive for Marketing said, “This is such an honour for MTN and I wish to thank our customers on the continent for their support over the years, which has seen us being ranked as the most admired African Brand yet again.”

Samuels adds, “With Africa being a young continent, young Africans want to experience a modern, digital, connected life. We are doing everything we can to make this a reality by leading the delivery of a bold new digital world in ways that are relevant to our customers.”

“MTN is committed to brightening lives every day by being a responsive, customer and community focused company.  Through the MTN Foundations we work together with communities to create opportunities to advance growth and development by supporting health and education initiatives and national development priorities. We are also working hard to deliver the best customer experience in voice, data, digital and financial services so that consumers across our footprint continue to choose us as their most admired and preferred brand.”

Telecoms companies have dominated the marketing landscape these past 15 years. We spoke to Bernice Samuels, chief marketing officer at MTN, about the group’s strategy when it comes to branding and marketing and where it fits within the company.

Where does branding fit in from a strategic standpoint?

As MTN we believe that a brand is as a brand does, so our branding is strategically significant, not just to drive awareness, recognition and recall but also in defining our customers experiences. So our brand positioning of BRIGHTER LIVES informs everything we design, build and deliver.

How important would you say branding is to the African consumer?

African consumers are no different from other consumers in their aspirations and expectations of brands. We are all human, and want things to be easy, personal, and give us some control delivering good quality, value, affordability, innovation and access. This being said, MTN is a brand born in Africa, and we want to reflect our African origins in how we go to market.

How important is being an African brand?

With Africa being a young continent, young Africans want to live a modern, connected life. We want to be second to none in shaping and making this possible. We want to lead a modern digital life experience in ways that are relevant to the African context. In enabling this, we believe that we will be the consumers’ choice, not only because we are an African brand, but also the very best at what we do in Africa.

You are at the forefront of technology and the new digital space. What are the main tools needed to build a brand; have they changed materially since you launched all those years ago?

Yes and no. We believe that the discipline of marketing is always about putting the customer at the centre of what you do. So it’s vital to diagnose the market, understand needs and meet these in a distinctive and differentiated way versus competitors. The channels at our disposal are indeed changing, with social media storefronts, instant messaging, mobile responsive web etc, which expand our route to market for our product and services and thus the design approach in constructing our marketing messages.

You operate in over 20 countries. Do you adapt the messaging to the different markets or is there one singular message that you like to put out there?

We have the same brand positioning as a mother brand in every market in which we operate. What differs are the operational and marketing tactics on the ground which must be locally relevant and resonate with consumers.

MTN Group has released its first quarter update for the period ended 31 March 2019, meeting its medium-term revenue growth target by delivering 10% year-on-year growth led by strong operational performance in South Africa, Nigeria and Ghana.

Commenting on the update, MTN Group CEO Rob Shuter said: “We are encouraged by the operational progress we continue to see across the business, supported by the network roll-out we achieved and enhancements to the propositions that we offer to our customers. In South Africa, we implemented changed pricing for pre-paid propositions where we reduced, materially the out-of-bundle tariffs, making data services much more affordable.”

Shuter added that the company takes note of the provisional report from the Competition Commission of Inquiry into data services and will respond by 14 June 2019. MTN remains of the view that the release of high demand spectrum in South Africa is critical to providing affordable and ubiquitous data services for the citizens of the country.

As part of broadening the fintech business, MTN also launched Africa’s first instant messaging platform ‘Ayoba’ in Ivory Coast and Cameroon with further expansion into other markets and the integration of payments planned in the second half of the year.

Commenting on the regional performance, Group CFO Ralph Mupita said: “We are pleased by the service revenue development, despite challenges in some markets. The growth in service revenue was supported by the continued expansion in voice, data and fintech revenue which increased 5,9%, 18,3% and 30,6% respectively. Our asset realisation programme remains on track, and we anticipate that the Mascom transaction will close by end of June 2019, subject to regulatory approvals. Good progress has also been made on repayment of the ATC Ghana shareholder loan to MTN Group.”

Early in the second quarter, MTN’s e-commerce joint venture Jumia Technologies AG successfully raised fresh capital to list on the New York Stock Exchange. MTN’s shareholding reduced to 18.9% in the IPO, and as at 6 May 2019, the value of its shareholding in Jumia was approximately $560m. The company completed the conversion of MTN Nigeria to a public company ahead of the listing by introduction on the Nigerian Stock Exchange anticipated for May 2019.

AGF matter

On Tuesday, 07 May the Federal High Court delivered its ruling, rejecting the Notice of Preliminary Objection filed by the AGF in response to MTN Nigeria’s lawsuit. The substantive case is now scheduled to be heard on June 26.

Looking ahead, the company remains committed to achieving its medium-term targets through delivering against all elements of its BRIGHT strategy.

MTN has noted with disappointment and concern the recent violence between in Kwazulu-Natal, South Africa, which caused the deaths of four people as well as the displacement of hundreds of others and the destruction of property. As MTN we strongly condemn prejudice and xenophobia, more so violence against other human beings.

As a leading pan-African telecommunications company with operations in 21 countries, MTN believes in the potential of an Africa whose nations pursue deeper trade, integration and cooperation. Given our roots and our operational footprint, we also have a strong commitment to human rights and dignity, diversity and inclusion.

We urge all our customers and stakeholders to support and defend the principles of human rights, diversity and inclusion and an integrated collaborative Africa. The MTN Foundation is mobilising in Kwazulu-Natal to offer support to the authorities and victims in their hour of need.

 

MTN Group has released its integrated and sustainability reports for the period ending 31 December 2018, setting out how the group creates value and highlights the six distinct growth opportunities the company is pursuing across the voice, data, digital, fintech, enterprise and wholesale markets.

The integrated report is MTN’s primary communication to stakeholders and aims to enable them to make an informed assessment of MTN’s performance and prospects. It is the company’s value-creation story. The sustainability report aims to provide a balanced, accurate and accessible overview of MTN’s strategy and performance relating to socio-economic, labour and environmental issues, and ethics and human rights.

As part of efforts to enhance digital inclusion, in 2018, the company started executing its dual-data strategy aimed at enhancing digital inclusion. Other key highlights include the expansion of active data users by 10 million to 79 million. The company highlights the growth in MTN Mobile Money users to 27 million, with services revenues of approximately R8bn as part of its efforts to drive financial inclusion.

In 2019, the company will continue implementing its CHASE framework to accelerate internet adoption by addressing issues related to quality coverage, handset availability, affordability, services and education to bring new opportunities to people previously excluded from the digital world.

MTN will also extend initiatives to make smartphones more accessible and affordable, mainly through the launch of its low-cost 3G smart-feature phone, priced at approximately US$25. MTN also plans to launch Mobile Money in South Africa, Nigeria, Afghanistan and Sudan and launch an advanced instant messaging and communications platform.

“As MTN, we are focused on solutions to enhance digital and financial inclusion and transform societies. We firmly believe that technology and connectivity can provide transformative solutions to some of the world’s complex challenges,” said Rob Shuter, MTN’s group president and CEO.

He added that, “In 2018 we unpacked what is really needed to connect people digitally and partnered with stakeholders who share our belief, that everyone deserves the benefits of a modern connected life.”

Tax contribution

The company also released its 2018 tax report, which shows that MTN’s contribution to tax revenues goes significantly beyond the corporate income taxes paid on its profits. In 2018, MTN’s total tax contribution was R24,1 billion, including but not limited to corporate taxes, indirect taxes, withholding taxes, payroll taxes, operating licence fees and other payments to government authorities.

Commenting on the tax report, MTN Group CFO, Ralph Mupita said, “The 2018 tax report yet again illustrates the significant contribution that the MTN Group makes to fiscal revenues in the various markets in which we operate, and call home.”

He added that, “We have a low tax risk appetite across all our markets and look to ensure that taxes due are paid. We further focus on ensuring that the highest level possible for tax compliance is adhered to across all markets.”

MTN accelerates growth, delivers on dividend, simplifies the group and lifts its medium-term targets  

Johannesburg – MTN Group published its financial results for the year ended December 2018 on Thursday, meeting all its medium-term targets, reducing its holding company leverage and accelerating service revenue growth driven by the implementation of its BRIGHT strategy.

It increased its subscriber base by 16 million to 233 million customers across 21 markets in Africa and the Middle East. The number of active data users increased by 10 million to 79 million and the active mobile money subscriber base rose to 27 million. This strong commercial momentum drove a 10,7% constant currency increase in service revenue to R125,4 billion.

“The service revenue growth rate achieved is ahead of both prior year and our guidance and – more importantly – is above the average rate of inflation in our markets, which means we are delivering real growth in service revenue,” said Rob Shuter, MTN’s group president and CEO.

Group Ebitda rose more than 15% and reported headline earnings per share (HEPS) increased to 337 cents from 182 cents in 2017. Adjusting for once-off items HEPS would have been 565 cents per share. The total full year dividend of 500 cents is well covered and a final dividend of 325 cents has been declared.

Optimising the portfolio

MTN has conducted an extensive review of its portfolio to reduce risk, improve returns and simplify MTN. This review covered not only its subsidiary companies but also its associates and its investments in e-commerce investments and tower companies. The group has R40 billion tied up in the value of the e-commerce and tower company investments and has announced that they are not viewed as long-term strategic assets of the group and will be monetised over time.

The group has committed to the portfolio review realising more than R15 billion over the next 3 years excluding any proceeds from its R23 billion position in IHS.

Pursuant to this it announced that it would be disposing of its associate in Botswana, Mascom, for $300 million where its lack of control position and MTN branding meant that the group is not able to execute on its BRIGHT strategy.

Stabilising leverage, managing regulatory challenges

The group stabilised its gearing, bringing the holding company leverage down to 2,3 times at December 2018 from 2,9 times at June 2018 and within the target range of 2,0 to 2,5 times. The group’s overall gearing moderated to 1,3x.

“We have made good progress to improve the holding company leverage bringing it within the medium-term guidance range we set out. Proceeds we receive from the asset realization program will support efforts to further reduce debt and de-lever the holding company balance sheet.” said group CFO Ralph Mupita. “We believe the holding company leverage is appropriate, and we can well manage the debt and deliver on our 500 cents progressive dividend policy in the future.” he added.

The company overcame several regulatory headwinds in 2018, the most material of which was the Central Bank Central Bank of Nigeria dispute on historical dividend repatriations. This was resolved and MTN announced in December 2018 that they had agreed to implement a notional reversal of the 2008 private placement and consequently made a resolution payment of $53 million. The group is committed to further enhancing its risk management and stakeholder management processes.

Enhancing guidance

“We see significant opportunity to grow subscribers and voice revenue as we also execute on the large mobile data opportunity,” said Shuter. “We are also extending our BRIGHT strategy to build MTN into a digital operator with a major focus on the fintech, digital, enterprise and wholesale business areas.”

“Key focus areas for 2019 are the launch of our own music streaming and instant messaging applications and extending MTN mobile money from 14 to 18 countries through launches in South Africa, Nigeria, Afghanistan and Sudan”

Considering the improved performance in 2018 and its growth plans, the group revised its guidance to investors upwards, targeting double-digit growth in service revenue, improved profit margins and capex efficiency and a new target to drive return on equity from 11% to over 20% in the next three to five years.

About the MTN Group

Launched in 1994, the MTN Group is a leading emerging market operator, connecting more than 230 million subscribers in 21 countries in Africa and the Middle East. The MTN Group is listed on the JSE Securities Exchange in South Africa under the share code: “MTN”. MTN is pursuing its BRIGHT strategy with a major focus on growth in its financial services, digital, wholesale and enterprise businesses.

 

View 2018 Financial Results for the year ended 31 December 2018.

 

MTN has announced its trading update for the year ended 31 December 2018.

MTN expects to report an almost doubling in earnings with growth in full year headline earnings per share forecast at between 80% and 90%.

MTN further noted that headline earnings per share were negatively impacted by a number of once-off and non-cash items totaling approximately 220 cents.

MTN is encouraged that post the resolution with the Central Bank of Nigeria MTN Nigeria has resumed dividend payments to its shareholders.

“We are encouraged by the progress made and we are looking forward to sharing our full results on the 7 March 2019.” said Rob Shuter, MTN Group President and CEO. – Issued by MTN Group Corporate Affairs

 

About the MTN Group

 Launched in 1994, the MTN Group is a leading emerging market operator, connecting more than 200 million subscribers in 21 countries in Africa and the Middle East. The MTN Group is listed on the JSE Securities Exchange in South Africa under the share code: “MTN”. MTN is pursuing its BRIGHT strategy with a major focus on growth in its data, financial services and digital businesses.

MTN Group’s newly acquired music streaming entity, Simfy Africa, has been given a welcome boost with the appointment of Oyebowale Akideinde as Head of Over the Top (OTT) Music Services. His appointment, effective 1 February 2019, will enhance the company’s digital music streaming services to its customers across Africa and the Middle East.

Oyebowale joins MTN from Boomplay Music where he served as the Regional Director for West Africa. His career spans over 17 years primarily in consumer goods, e-business, financial, media and digital sectors. He has also worked in IT, project management, strategy, product and business development, and marketing.

He holds an MSc in Business Information Systems from the University of Hertfordshire, a BSc in Computer Science from the University of Lagos and a General Music Studies Specialist certificate from Berklee College of Music. Oyebowale has also garnered a number of industry related awards and accolades throughout his career.

Commenting on Oyebowale’s appointment, Rob Shuter, MTN Group President and CEO said, “We are very pleased about Oye’s appointment as he brings passion and knowledge of the rich media industry, this will stand him in good stead to support MTN’s expansion of OTT digital services to our customers.”

About Simfy

MTN acquired Simfy, dubbed as Africa’s leading music-streaming business, in November 2018. It boasts a broad catalogue of music and access to more than 42 million tracks; the entity has also partnered with record labels and content distribution platforms such as Warner Music, Universal Music Group and Content Connect Africa to bring subscribers a wide range of music. Shortly after the acquisition of Simfy, MTN launched MusicTime! in South Africa, a service which offers users premium trending and locally relevant music.