MTN shows marginal growth in South Africa

MTN on Thursday reported a quarterly update for the period ended March 2018, showing marginal growth in its home territory of South Africa.

MTN South Africa recorded first quarter year-on-year service revenue growth of 2.5%. “While lower than our full-year expectations, this improving QoQ performance follows the more muted performance in the prior quarter (4Q17),” said MTN Group president and CEO, Rob Shuter.

The growth was supported by data and digital revenue, which increased by 12.1% and 17.7% respectively, while outgoing voice revenue decreased by 9.2%. Data traffic increased by 49%, supported by a 14% increase in active data users.

MTN South Africa’s EBITDA margin expanded to 35% YoY, supported by continued cost efficiencies and the increase in service revenue. “Our customer value management (CVM) platform is now in place with a focus on managing the core voice business while driving overall customer spend and offerings,” it said.

“Following the marked improvement in our network in 2017, we invested R1.7 billion in capex in the first quarter of 2018, maintaining our leading network position, Shuter said.

The South African postpaid business continued to focus on customer acquisition, CVM, improving channel footprint and reducing churn. “To this end, we reported 132 000 postpaid net additions on the back of a continued improvement in the consumer segment.

“While our enterprise business remains challenged, we now have the leadership team in place, and are executing on a turnaround plan focused on improving customer retention and acquisition. Prepaid net additions in the quarter came in at 536 000, the chief executive said.

Shuter said that during the quarter, the group continued to focus on operational execution across all markets, leveraging off the strong network investment of the past few years. “This allowed us to deliver an acceleration in service revenue growth to 9.1%, led by MTN Nigeria and MTN Ghana.”

Group voice revenue growth of 5.4% benefited from strong growth in Nigeria and Ghana of 15.2% and 20,6% respectively. Group data revenue grew by 26.9%.

Highlights

  • Group subscribers increased by 1.9% quarter-on-quarter (QoQ), with net additions of 4.1 million;
  • Active MTN Mobile Money customers increased by 3.9% QoQ to 22.7 million;
  • Voice traffic (billable minutes) increased by 24.2% and total data traffic increased by 56.7%;
  • Group service revenue increased by 9.1%;
  • Group data revenue increased by 26.9%;
  • MTN South Africa increased service revenue by 2.5% while the EBITDA margin increased by 150bp year-on-year
    (YoY) to 35%;
  • MTN Nigeria increased service revenue by 14.4% while the EBITDA margin increased 340bp to 41.8%;
  • MTN Irancell increased service revenue by 15.2%.

 


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