Telecommunications giant MTN Group has reported double-digit growth in earnings and service revenue for the third quarter of 2020, as larger operations in South Africa, Nigeria and Ghana deliver solid performances and subscriber numbers surge.
In the three months to September, earnings before interest, taxes, depreciation and amortisation (Ebitda) increased by 13.9% and the group Ebitda margin widened by 1.4 percentage points to 43.3%, in line with medium-term targets.
Service revenue grew by 11.4% to more than R43-billion, supported by a 2.1% growth in service revenue in South Africa and a 13.8% growth in service revenue in Nigeria.
“We recorded solid growth in voice revenue of 3.9%, which reflects an encouraging recovery supported by the easing of lockdown restrictions. Data revenue grew by 31.9%, bolstered by increased demand for work-from-home services, digital entertainment as well as online education offerings,” said MTN Group president and CEO Ralph Mupita.
The group also reported growth of 21% in fintech revenue and 37.5% in digital revenue, driven by the increased adoption and usage of digital offerings.
MTN South Africa sustained its turnaround, with an acceleration in its core consumer and enterprise business units in the third quarter, while MTN Nigeria recorded a solid result with some recovery in revenue growth under difficult operating conditions and MTN Ghana’s continued strong operational execution drove the delivery of another good performance.
During the quarter under review, MTN’s subscribers increased by 12-million to a total of 273-million, while active data users increased by 5.3-million to 107-million.
In South Africa, total subscribers increased by 1.9-million to 30.9-million.
“South Africa’s strong data traffic growth of 80.6% coupled with a 500 000 increase in active data users to 14.7-million supported a solid 16% increase in overall mobile data revenue.”
MTN Nigeria added 3.9-million customers in the third quarter, bringing the overall base to 75-million subscribers, while data continued on a strong trajectory of growth with revenue up 57.1%. The number of active data subscribers reached 30.7-million, an increase of 1.7-million.
“In our work to enable greater financial inclusion, we reached a significant milestone by surpassing the 40-million MTN Mobile Money (MoMo) user mark, an addition of 3.5-million in the quarter to 41.8-million at end-September,” Mupita said.
MoMo in South Africa has accrued two-million users since its launch in January.
To meet the increase in data and digital use, he added that MTN had focused its investment on network capacity and resilience and modernising its information technology systems, spending R16-billion in the year to the end of the third quarter.
Meanwhile, as part of its asset realisation programme, MTN Group completed its exit from its 18.9% investment in e-commerce venture Jumia as well as the localisation of an 8% shareholding in MTN Zambia, realising net proceeds of approximately R2.3-billion and R204-million respectively.
“Despite the relaxation of lockdown restrictions, the operating environment remains challenging and uncertain. We will continue to build on our operational and financial resilience. We have now increased our full-year forecast for capital expenditure to R26-billion, to ensure that our networks provide reliable connectivity and digital services to all of our 273-million-and-growing subscriber base,” he said.