Telecommunications group MTN has lifted its interim dividend by 20,3% to 445c/share after reporting a strong earnings and revenue performance outside its home market of South Africa.
Profit margins — measured before interest, tax, depreciation and amortisation — widened by 3,5 percentage points to 46,3%. Revenue climbed by 10,7% (4,1% stripping out the effect of currency volatility) to reach R72,8bn for the six months ended 30 June 2014.
Sales were propelled higher by a 38,9% improvement in data revenue, which reached R12,7bn for the six-month period. Mobile Money subscribers grew by 24,3% to 18,4m.
The South African operation, however, dragged on the numbers. MTN South Africa lost market share as the ongoing price war took its toll, with revenue slumping by 7%.
Nigeria was a standout performer, with revenue climbing by 21,% (8% in constant currency). Nigeria’s earnings before interest, tax, depreciation and amortisation (Ebitda) increased by a healthy 11,3% to R16,3bn.
MTN says it is nearing a plan to sell its Nigerian base stations to a third-party tower operator. The transaction will result in the sale of 8 640 existing towers and 543 that are under development. The group intends to retain a non-controlling interest of 51% with protective rights in the new entity and will enter into a lease agreement for the use of the tower infrastructure.
Nigeria’s subscriber base grew by 1,7m to 58,4m, with revenue rising by 8% and Ebitda margin climbing by 1,9 percentage points to 60,1%.
MTN Irancell, the group’s joint venture in Iran, increased its subscriber base by 3,2% to 32,7m. Revenue climbed by 13,8%. The company will begin delivering 3G services in Iran soon. Ebitda margin was down slightly to 44,4%.
Group subscriber numbers rose by 3,5% to 215m. Group Ebitda increased by 19,5% to R33,7bn, helped by currency volatility and cost-cutting initiatives, including a sharp reduction in capital expenditure. Data underpinned the growth, contributing 17,5% to total revenue, from 13,9% in the same period last year. Data traffic across the network grew by 84,8% to more than 47PB. The number of data users increased by 7,3% to 88,5m. — © 2014 NewsCentral Media
