MTN posts positive H12020 results despite an adverse operating environment

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A customer leaves an MTN shop in Johannesburg, file. REUTERS/Siphiwe Sibeko
  • Group revenue grew by 7.8%
  • Service revenue increased by 9.4%
  • Voice revenue grew by 2.6%
  • data revenue grew by 37.2%

Harare – South Africa’s telecoms giant Mobile Telephones Network (MTN) posted strong results for the half year period ended 30 June 2020 against a backdrop of difficult trading conditions aggravated by the socio and macroeconomic challenges caused by the COVID-19 pandemic.

According to the group, service revenue grew by 9.4% to R80.2 billion from R67.9 billion in the prior comparable period as its group efficiency programme continued to bear fruit.

The group said, “This was led by growth of 12.4% in MTN Nigeria and 19.4% in MTN Ghana. MTN SA recorded a 2.5% decline in service revenue, as a result of the lost national roaming revenues arising from the discontinuation of our roaming agreement with Telkom and effects of the continued accounting for Cell C revenue on a cash basis. The continued turnaround in MTN SA’s consumer and enterprise businesses has, however, supported a pleasing improvement in sequential service revenue growth trend in the second quarter.”

MTN also added that service revenue grew ahead of inflation despite a slowdown in the second quarter when lockdown restrictions came into force in most of the countries in which the group operates.

Likewise, MTN said voice revenue increased by 2.6%, as trends indicated some shift in the revenue mix as a result of the COVID-19 pandemic, and seasonally lower voice revenue in markets where the holy month of Ramadan is observed.

 “The month-on-month trends indicate some recovery in voice revenue, which has increased by 5, 9% in June 2020 versus the April 2020 level. We continue to drive growth, focusing on our customer value management (CVM) initiatives and segmented offers. Group subscribers increased by 10, 6 million to 261, 5 million, “said MTN.

Meanwhile data revenue expanded by 32.7% as data traffic surged by 91.5% boosted by the increase in work-from-home and higher levels of online engagement brought about by the effects of COVID-19.

Basic earnings per share increased by 165.4% to 674 cents from 254 cents (June 2019), supported by the weaker rand, an overall healthier operational performance as well as an improved contribution of share of profits from JVs and associates.

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