MTN, South Africa’s second-biggest mobile phone operator, has delivered strong results to start the year, with solid revenue growth despite a drop in subscriber numbers.
The telco said on Wednesday service revenue rose 4.1% in the first quarter of 2017 financial year, boosted by data and digital revenue which jumped 17.8% and 20.3% respectively.
However, outgoing voice revenue declined 5.4% year-on-year as billable minutes dropped 7.5%.
MTN South Africa’s customers were down 1.7% to 30,2 million in the first quarter due to seasonality.
“We remain committed to our net additions guidance of 630 000. We are encouraged by the progress made in our relationship with our franchise channel and this, together with the ongoing systems and process improvements should drive continued improvement in the customer experience,” MTN informed investors on Wednesday.
MTN Group CEO, Rob Shuter, said in a statement: “In South Africa, we are making progress on tackling our underperformance in the postpaid segment although it will take time for this to reflect in our financial performance.”
The company said it would continue to focus on driving network quality, offering attractive value propositions and improving the customer experience in South Africa.
In the period, MTN said it continued its network expansion with 515 LTE sites and 53 3G sites going live.
“We now have very strong network performance in three of the four large metro areas (Cape Town, Pretoria and Durban) and expect this to support a continued improvement in our net promoter score (NPS),” the company said.
MTN Group subscribers were down by 1,5% quarter-on-quarter to 237 million, largely as a result of restatements to subscriber numbers in Ghana, Rwanda and Zambia. “While our reported subscriber numbers are lower than we had expected, this is largely the result of an ongoing review of subscriber definitions. We are planning to further modernise our internal subscriber definitions to more closely align with the changing mix of revenue streams and will report on this at the end of the first half of 2017,” said Shuter.
MTN Nigeria delivered continued the positive operational momentum and reported an 11,6% increase in total revenue. While MTN Irancell increased total revenue by 19,3% benefiting from encouraging data revenue trends.
“In our key markets of South Africa, Nigeria and Iran significant network investments made over the past few years are underpinning the improving revenue trends. The network investment planned for 2017 is expected to support further market share gains across our markets,” said Shuter.