MTN has disconnected another 4.5 million subscribers in Nigeria, as group subscribers drop 1.4% in the first quarter of the year.
The telecoms giant says MTN Nigeria's subscriber base dropped almost 7% quarter-on-quarter to 57 million subscribers for the period ending 31 March. This was due to another round of mass disconnections in February, which were related to an ongoing registration compliance process in the country.
MTN got itself into hot water last year when it failed to disconnect 5.1 million subscribers in Nigeria by a regulatory deadline. The company still faces a $3.9 billion (R56 billion) fine from the Nigerian Communications Commission because of the previous disconnection issue. In February, MTN paid Nigerian authorities $250 million (R3.5 billion) in a "good faith payment" towards settling the hefty fine in the West African nation.
"We believe we have now dealt with all the subscribers who were considered to be non-compliant," MTN said in a quarterly update this morning.
MTN Group executive chairman Phuthuma Nhleko says the first quarter of 2016 saw the group impacted by "the 'aftershocks' of the events that took place towards the end of 2015, mainly the subscriber registration process in many of the countries in which we operate, with Nigeria being the largest".
"To mitigate any future regulatory challenges, the group took an exceptionally conservative stance by disconnecting all subscribers who could possibly be deemed to be non-compliant," says Nhleko.
This had a "significant unfavourable impact" on the total subscriber growth and revenue in the first quarter. Nhleko says MTN believes its resolve to address compliance matters decisively, has now put the group on a solid footing with regard to the subscriber registration process and regulatory matters in general.
"The group has undertaken a number of 'back to the basics' structural and operational initiatives that will hopefully reset and position the group for future growth in a rapidly evolving sector," adds Nhleko.
MTN says the Nigerian operation continues to focus on reconnecting subscribers through proactive engagement and 'win back' offers.
"Following the re-instatement of regulatory services in March, MTN Nigeria continued to engage the regulatory authorities and we hope to receive approval from the regulator for approval of promotional products and services during the current month," the company says.
SA subscribers drop
Meanwhile, MTN South Africa's subscribers also decreased by 1.7% quarter-on-quarter to 30.1 million. This was impacted by "seasonal trends and an alignment of the subscriber base, particularly the recently acquired subscriber base from Autopage".
In SA, MTN's prepaid subscriber base declined by 1.8% quarter-on-quarter to 24.9 million. The postpaid base declined by 0.8% to 5.2 million.
MTN says average revenue per user was also impacted by "the exceptionally unfortunate 48-hour network outage experienced in February". This had a negative impact of approximately 3% on revenue for the month while billable minutes for the quarter declined by 11.3% year-on-year. In March, MTN saw a 10% month-on-month increase in revenue.
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