MTN Nigeria reported growth in revenue and earnings before interest, taxes, depreciation and amortisation (Ebitda) despite facing volatility in voice and data revenue over the nine months ended September 30.
The group’s Ebitda increased 9.1% to N497.9-billion; however, its Ebitda margin contracted 2.3 percentage points to 51% owing to cost pressures, mostly from increased investments in the network and the impact on costs of the depreciation to the Central Bank of Nigeria and Nafex exchange rates.
Profit before tax (PBT) declined 0.6% to N211.6-billion, while earnings per share (EPS) declined by 3.3% to N7.1kobo. During the third quarter of the year, MTN Nigeria experienced a recovery in PBT with growth of 2.2% and a marginal decline of 0.7% in EPS.
Service revenue increased 13.9% during the period under review to N973.8-billion.
“During the period under review, we saw volatility in both voice and data revenue, affecting the trajectory of our overall service revenue, as well as pressure on costs, which continues to impact our operating margins, dampening profitability,” MTN Nigeria outgoing CEO Ferdi Moolman commented.
MTN Nigeria reported a normalisation of traffic after a period of decline in voice traffic and an acceleration in data during lockdowns in the second quarter, with service revenue growth accelerating 16.5% in the third quarter.
During the nine months to September, data revenue rose by 57%, with an increase in data use and traffic. Revenue from digital and fintech services rose by 114.3% and 28.3% respectively, while voice revenue growth was 4.2%.
“We saw a significant increase in our subscriber base with the addition of 3.9-million customers in the third quarter, bringing total subscribers to 75-million. Cumulative net additions totalled 10.7-million in the nine months to September 2020, the first time we have exceeded 10-million additions in an annual cycle with one quarter remaining,” Moolman said.
MTN Nigeria also connected 1.7-million new users to the Internet in the third quarter and 5.5-million for the nine months under review, bringing its active data subscribers to 30.7-million.
“To accommodate the increase in traffic and enhance service quality for all our customers, we continued to invest in the capacity and resilience of our network, accelerating our fourth-generation (4G) rollout and expanding our investments in rural connectivity.
MTN Nigeria’s 4G network now covers 52.9% of the population, up from 48.6% in the second quarter and 35.4% in the third quarter of 2019.