MTN revenue drops by 20% in H1 2024 — due to naira devaluation

MTN Group says its revenue declined by 20.8 percent to 85.3 billion rands in the first half (H1) of 2024 — down from 107.7 billion rands in H1 2023.

In a statement on Monday, the telco giant said the drop in revenue was due to the devaluation of the naira as well as the ongoing conflict in Sudan.

MTN also said it delivered a strong commercial momentum, executed key strategic initiatives, and sustained the strength and resilience of the balance sheet.

“In constant currency, data service revenue increased by 21% in the six months to 30 June 2024 and fintech service revenue climbed by 27%,” the company said.

“In line with our Ambition 2025 strategy, we made good progress to further increase the level of local ownership of MTN Ghana and MTN Uganda, with gross proceeds of R1.7 billion. 

“The Group also completed the orderly exit of operations in Afghanistan and Guinea-Bissau, as part of portfolio optimisation and simplifying the group.

“At the end of June 2024, MTN had 288 million subscribers across 18 markets. Of these, 150 million were active data subscribers – up more than 9% – who lifted data traffic on MTN’s network by more than a third to 9,054 petabytes. 

“At 66 million, the number of active Mobile Money users was also more than 9% higher, boosting MTN’s fintech transaction volumes by 18% to 9.7 billion in the period.

“The strong underlying performance was masked by the impact of weaker currencies – most particularly the naira against the rand – as well as the ongoing conflict in Sudan on the Group’s reported results.”

Speaking on the development, Ralph Mupita, MTN Group president and chief executive officer (CEO), said although the commercial momentum and strategy execution was solid in H1, “macro headwinds impacted reported results”.

“The sharp devaluation of the naira over the period had the most significant impact on reported results,” Mupita said.

“Impacted by the naira devaluation, the translation into the reporting currency, and the conflict in Sudan, adjusted headline earnings per share (HEPS) decreased by 50% to 373 cents and adjusted return on equity (ROE) declined by 4.2 percentage points to 20.2%.

“MTN South Africa, which has now completed its network resilience investment, demonstrated encouraging progress from Q1 24 to Q2 24 in terms of topline growth and earnings.

“The investment positioned it to provide an average network availability of more than 95% under stage 6 load-shedding. 

“At the end of June 2024, network availability was 99%, supported by reduced load-shedding in Q2 24.

“MTN Nigeria delivered a strong underlying performance, despite the severe macro impacts on its financial performance.”

He also noted good progress in key initiatives including acceleration of revenue, optimisation of capex, and the reduction of its US dollar-denominated obligations.

Mupita added that the near-term macro backdrop continues to be challenging across the company’s markets, adding that “GDP, inflation, and currencies are expected to improve into 2025 across key markets”.