MTN Group Reports Half-Year Loss Amid Currency Devaluations in Nigeria, Operational Hurdles

For the six-month period ending June 30, the company reported a pre-tax loss of 9 billion rand, a stark reversal from the restated profit of 8.3 billion rand recorded in the same period last year.

CEO Ralph Mupita highlighted the severe impact of the naira’s continued depreciation against the U.S. dollar and the ongoing conflict in Sudan on the company’s financial performance. “These factors had the most significant effect on our reported results,” Mupita explained.

Despite the challenging environment, MTN Group, which serves 288 million customers across 18 African markets, saw a 20.8% decline in group service revenue, which totaled 85.3 billion rand. However, in constant currency terms, this revenue, excluding device and SIM card sales, increased by 12.1%.

In South Africa, MTN’s service revenue outpaced that of its Nigerian operations, rising by 3.3% to 21.1 billion rand. Conversely, revenue from MTN’s Nigerian operations plummeted by 52.9% to 20.5 billion rand, although it rose by 32.4% when adjusted for constant currency.

The naira’s persistent dollar shortages and devaluations, driven by recent government measures to stabilize the currency and attract investment, have significantly impacted MTN’s Nigerian revenues.

Looking ahead, MTN Group plans to distribute a minimum final dividend of 330 cents per share for fiscal 2024. The company is also progressing with its strategy to raise 25 billion rand by next year through the sale of non-core assets and reducing its stake in various operations. To date, MTN has raised 21.7 billion rand from such sales and is on track to meet its target.

During the reporting period, MTN reduced its stakes in MTN Ghana and MTN Uganda, netting 1.7 billion rand. Mupita also indicated that further stake reductions are planned in Ghana (by approximately 2.1%), as well as in Cameroon, Ivory Coast, and Nigeria.