MTN cuts capital expenditure guidance
JOHANNESBURG - MTN has announced a 21 percent cut for its capital expenditure (capex) guidance for 2020 due to supply chain disruptions as a result of the Covid-19 pandemic, as it announced an improved service revenue during the March quarter of 2020.
MTN, Africa's telecommunications giant said earlier today that it had updated its capex guidance for 2020 to between R21 billion and R22bn, from the R28.3 bn that it previously guided at during its 2019 results.
Group chief executive Rob Shuter said that the company’s capex would focus on ensuring the resilience and capacity of its networks.
"We anticipate that disruptions in the supply chain and challenges in rolling out coverage under lockdown rules combined with our emphasis on liquidity will impact on our capex programme for the year," said Shuter.
Shuter said however that the impact of the pandemic on the quarter one performance was not significant as lockdown restrictions for its consolidated subsidiaries were only implemented from the last week of March 2020.
Highlights for the quarter included the addition of 6.6 million subscribers with active data users increasing by 2.9 million and MoMo subscribers by 0.4 million.
Group service revenue jumped by 11 percent on double-digit growth in the Ghanaian and Nigerian markets which helped offset the decline recorded in South Africa.
Recorded voice, data, and fintech revenue grew by 6.3 percent, 26.4 percent, and 26 percent respectively as the group continued to execute its strategy of becoming a digital operator. Digital revenue increased by 15.6 percent signaling a return to growth. However Covid-19 disruptions resulted in a slowdown in voice usage due to slower economic activity, which had been compounded by the migration to digital connectivity arising from increased teleworking.