MTN Group, Africa and the Middle East largest mobile phone operator, announced on Thursday it has added 10.4 million new subscribers for mobile, data and mobile money services for the 9 months to September 2019.
The Johannesburg-based company said subscribers rose quarter-on-quarter (QoQ) by 3,5 million to 243,7 million.
The company, which is valued at R179 billion on the JSE, added that active data subscribers increased QoQ by 4,7 million to 87,0 million.
While active MTN Mobile Money customers rose QoQ by 2,2 million to 31,7 million.
The operator said service revenue rose year-on-year (YoY) by 9,6%, with earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 41,1%.
“Service revenue growth and improvements in our EBITDA margin continued into the third quarter. We remain committed to driving access to internet and financial services and in Q3 we added 4.7 million active data users and 2.2 million Mobile Money subscribers across the portfolio,” MTN Group CEO Rob Shuter said.
“Our Ayoba messaging platform is now available across five markets and is already recording 515,000 active users per month.”
The group benefited from strong performances in Nigeria and Ghana, which generated double-digit service revenue growth and improved EBITDA margins, driving growth in group service revenue of 9,6% YoY and in EBITDA of 11,8%.
Unrecognised roaming revenue from Cell C
The performance of MTN South Africa continued to be impacted by a weak economy, the implementation of lower out-of-bundle data prices, new data usage rules and unrecognised roaming revenue from Cell C.
At June 2019 MTN had not recognised R393 million of unpaid revenue from its roaming agreement with Cell C and an impairment of R211 million had also been raised.
Since the end of June 2019 to date, Cell C has made payments amounting to nearly R750 million, in line with an agreed payment plan.
“MTN has continued its conservative accounting for the Cell C roaming contract and only payments received during the third quarter were processed, and all against the outstanding balances as at June 2019,” MTN informed investors on Thursday.
“We continue to work with Cell C on an expanded network deal and are seeing good progress to date.”
MTN expects an improved performance in South Africa in 2020 as the effects of the End User regulation on OOB usage moderate, the enterprise division returns to growth and the Cell C situation stabilises.
“We are confident that in Nigeria we will maintain service revenue and EBITDA growth in line with the medium-term guidance. This will be delivered as we improve our data revenue performance with increased 4G coverage as we utilise our 800 Mhz spectrum,” the company said.
“We are also pushing ahead with our mobile money strategy through the super-agent licence, with 66,282 registered agents currently and a target of 100,000 by year-end.”
Shuter concludes: “Although conditions have been tougher in the year, we have sustained our performance in 2019 and looking forward, we are focussed on executing our BRIGHT strategy to deliver sustainable growth in our operations and to simplify our portfolio to reduce risk and improve returns. We remain resolute and committed to building our digital operator strategy and delivering on our medium-term targets and dividend policy.”
