MTN reports strong quarterly growth amid legal challenges

Africa’s largest mobile network operator, MTN, has reported solid growth as revenue gained 19.8% - when stripping out currency fluctuations – for the three months to March.

MTN recently lost a court case in South Africa that means that Middle Eastern rival Turkcell can present evidence that it believes shows that MTN committed acts of bribery and corruption to overturn the award of an Iranian GSM licence to Turkcell. MTN is set to appeal the landmark judgement that allows issues in a different geographical location to be heard in South Africa.

In addition, there is currently a matter moving through the legal process in the US alleging that MTN breached aspects of that country’s Anti-Terrorism Act. MTN’s full statement on that matter is here and it said it is keen to have an opportunity to “produce and solicit evidence to disprove” the allegations.

The JSE-listed company, which has just shy of 300 million customers in 16 markets, pointed to a growing subscriber base, a 28.7% gain in data revenue, as well as a 25.2% increase in fintech income as the backbone behind its “strong operational execution”.

With voice continuing to be a technology of the past, MTN’s data traffic gained 30.4%, while fintech transaction volumes increased by 13.9% to 5.5 billion as transaction value grew 48.9% to $95.3 billion (R1 744 trillion).

Nigeria and Ghana advanced its subscriber and revenue growth, it said.

In the announcement of the figures on Monday, group president and CEO Ralph Mupita said the “robust” performance was “anchored in the continued strong execution of our strategic and operational priorities, and buoyed by improved macroeconomic conditions in key markets”.

The company invested R7.5bn in capital expenses into networks and platforms during the quarter “in support of our commercial initiatives, to sustain the encouraging strong growth in our business,” said Mupita.

MTN pointed to the fact that macroeconomic and regulatory developments in key markets have started to trend positively, although it is “cognisant of the potential disruptions to these trends from evolving geopolitics and trade tensions”.

It noted: “We remain focused on the execution of our strategy to capture the growth opportunities presented by structural demand for data and fintech in our markets”.

IOL