MTN records a 10.5% rise in its Nigerian mobile subscriber base
MTN said its Nigeria unit posted a 6.1million increase in mobile subscribers to 64.3million as active data users jumped by 34.9percent to 25.2million on the back of several initiatives to boost numbers. It said profit before tax strengthened 31.1percent to R12.4billion.
MTN Nigeria’s chief executive Ferdi Moolman said the group focused on several initiatives to enhance coverage and drive data usage penetration during the third quarter.
“These initiatives include optimising frequencies, expanding our 4G network coverage with more than 6000 additional sites leveraging 800 megahertz (MHz) spectrum and repositioning our commercial data offerings,” Moolman said.
Last year, the Nigerian Communications Commission (NCC) approved the transfer of 800 MHz spectrum, enabling the company to extend its network reach to rural areas. Moolman said the 4G population coverage rose by 8.4 * /* to 43.8percent, giving citizens in 68 additional cities access to 4G. “We closed the year with 132 cities covered by 4G and became the first mobile network operator in West Africa to demonstrate the capability of 5G technology. We are excited about its potential for our customers and Nigeria’s overall national development plans,” Moolman said.
MTN has had several run-ins with Nigerian authorities in the past, including a $5billion (R78.38bn) fine by the NCC for missing a deadline to disconnect subscribers without proper registrations.
However, the penalty was eventually settled to about $1bn and a commitment to sell shares on the local stock market. MTN Nigeria listed on the Nigerian Stock Exchange last year, which has led to a broader base of Nigerian shareholders for the company. Last year, MTN Nigeria also dropped the case against the attorney-general of the Federation after it resolved the dispute over unpaid taxes.
Peter Takaendesa, head of equities at Mergence Investment Managers, said that MTN Nigeria’s performance was robust. He said uncertainty in the continent's most populous country however, remained.
“There are few concerns in that market, including that the Nigerian naira could weaken as oil prices come under pressure,” Takendesa said. “That would be a problem when converting the profits into rand and also US dollar costs in the Nigeria operations.”
Takaendesa said MTN Nigeria’s financial results were a reflection that management was executing very well to regain market share.
“MTN Nigeria changed its management team in the wake of run-ins with the authorities of that country a few years ago. The new management is clearly executing better. The failure of Etisalat Nigeria, now called 9 mobile, has also helped the company regain market share,” said Takaendesa.
MTN said it planned to invest about R25.68bn in the network in the next three years.
“This investment will enable us to accelerate our 4G network expansion, deepen population coverage and support the Federal Government’s broadband initiative,” said the company.
The group is expected to release its results next week.