Margins at MTN South Africa have shown strong improvement in the third quarter, the telecommunications group said in a statement to shareholders on Monday.
Revenue improved by 3,6% quarter on quarter, while margins — measured using earnings before interest, tax, depreciation and amortisation — expanded by more than two percentage points, the group said.
“MTN South Africa expects to maintain this improvement in Ebitda margin in the fourth quarter,” it said.
Average revenue per user increased by 10,4% quarter on quarter.
The improvements come after MTN hiked contract tariffs on 1 August.
The improvements came despite a “marginal” decline in subscribers of 0,5% quarter on quarter to 29,7m. There was a 0,7% decline in the prepaid subscriber base to 24,5m, which it blamed on churn from low revenue-generating customers.
The post-paid subscriber base increased by 0,7% to 5,2m as a result of an “improved customer experience, network quality, segmented customer offerings and attractive price plans”, it said.
Data revenue increased by 15,1% year on year and contributed 34,4% to total revenue. This was driven by increased volumes of high-denomination data bundles sold and attractive digital offerings. “The increase in the number of smartphones and improvements made on the network also contributed to data revenue growth.”
The number of smartphones on the network increased by 9,3% year on year to 9,2m.
MTN said that during the third quarter, the group embarked on a “material transformation project”, focusing initially on its key operations of Nigeria and South Africa.
“A dedicated transformation office was established to drive this transformation to maximise revenue growth, enable a distinct customer experience and ensure operational efficiencies, including concerted initiatives to drive optimal return on investment, with hard targets set for the next 12, 18 and 24 months,” it said.
“Operations are expected to deliver the first results on clearly defined targets in the first half of 2017.” — © 2016 NewsCentral Media