MTN on Wednesday reported headline earnings per share (HEPS) of 215 cents for the six months ended 30 June 2018, compared to 231 cents in the comparable period.
Although it noted improved constant currency results for the six month period, MTN’s revenue declined to R62.8 billion, from R64.8 billion before.
On a constant currency basis, however, revenue climbed 9.7%, led by a 26.7% increase in data revenue, to R15 billion, and supported by digital revenue, up 7.6% to R6 billion. Service revenue on a constant currency basis was up 10.2%, to R59 billion.
Operating profit however, was a fraction higher at R10.83 billion, from R10.4 billion in 2017.
For South African operations, revenue improved to R21.16 billion, from R20.5 billion, while EBITDA was at R7.45 billion, versus R7.05 billion before.
Local capex also improved to R3.9 billion, from R3.47 billion in 2017.
Group HEPS, the group said, were negatively impacted by a swing of 21 cents in associates and joint ventures. HEPS were impacted by the following items: 17 cents relating to the Nigeria fine interest; hyperinflation of 27 cents; and the impact of foreign exchange losses and gains of 21 cents, and reflected a decline to 280 cents from 346 cents.
Group capex increased to R11.461 billion for the first half.
Growth in service revenue accelerated, margins on earnings before interest, taxation, depreciation and amortisation (EBITDA) increased, and voice, data and digital revenue continued to expand, MTN said.
Group service revenue increased by 10.2%, while data revenue increased by 26.7%, it said.
For South Africa, service revenue increased by 2.9%, data revenue increased by 13.5%, while digital revenue increased by 17.9%, the operator said.
At 30 June 2018, the group had 223.4 million subscribers. This compares to 217.2 million at the end of 2017.
The group declared an interim dividend of 175 cents per share.
“MTN had an encouraging first half of 2018, with an acceleration in the second quarter, supported by an improved operational performance across many markets. This was led by Nigeria, Ghana and South Africa,” said group president and CEO, Rob Shuter.
“Service revenue growth increased, driven by robust voice revenue growth and the continued expansion of data and digital revenue. This in turn was supported by a 2.8% increase in subscriber numbers, continued network rollout, increasing 3G and 4G population coverage and improving customer service.”
He said that despite continued challenges in repatriating funds from MTN Irancell, the board remains committed to plans to declare a total dividend of 500 cents per share for 2018 and is targeting growth of 10% to 20% over the medium term.
“We believe everyone deserves the benefits of a modern connected life and see opportunity to provide this. We are confident that MTN remains well placed to deliver on our medium-term guidance.”
MTN South Africa
- Service revenue increased by 2.9%
- Data revenue increased by 13.5%
- Digital revenue increased by 17,9%
- EBITDA grew 5,7% to R7 450 million
- Capex increased by 12.5%
“MTN South Africa reported improved profitability on a strong consumer business, supported by our CVM initiatives. However, growth in service revenue was below expectations on the slow turnaround of the enterprise business.
“Despite this, we started to see a stabilisation of enterprise towards the end of the second quarter after the appointment of new leadership. Data usage was driven by the strong uptake of social media bundles. Digital revenue grew on demand for Xtratime and gaming,” the group said.
Prepaid service revenue increased by 2.5%, while postpaid service revenue declined by 2.5%. Postpaid churn stabilised.
“We expect an acceleration of service revenue growth in the second half, driven by improvements in the postpaid and enterprise segments,” the group said.
The subscriber base increased by 2.2% from December 2017 to 30.2 million.