Mobile operator MTN said this morning its revenue increased 12%, to R13.6 billion, for the year ended 31 December 2013, driven mainly by the weakening of the rand against a number of currencies in which its businesses operate.
SA's second-largest operator, which has a presence in 22 countries across Africa and the Middle East, says the group subscriber base grew by 9.8%, to 207.8 million, adding that this growth was supported by competitive segmented offerings and improved network quality and capacity in many markets.
During the period, MTN says its capital expenditure increased 4.6%, to R30.1 billion. "The efficient execution of our extensive capital expenditure programme significantly improved network quality and capacity, and facilitated higher voice and data traffic.
"This investment in capacity will also ensure that MTN remains competitive and is able to roll out solutions beyond traditional voice services," the operator said in a statement.
Basic headline earnings per share increased by 27.3%, to 1 386c, and attributable earnings per share increased by 27.4% to 1 434c.
Voice under pressure
The operator also states that group earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 13%, to R58.8 billion, excluding the profit from the sale of towers.
"Further progress was made on cost optimisation across the group, which supported the EBITDA margin of 43.1% for the year, 0.4 percentage points higher than the previous year. The good progress made on cost savings was offset to an extent by the lower EBITDA margin in the South African operation, which was largely driven by the decline in revenue."
During the period under review, MTN says voice revenue contributed 75.5% of total revenue; however, voice continued to face pressure as a result of aggressive price competition and lower mobile termination rates, which caused a decrease of 1.8 percentage points in its contribution to overall revenue. "MTN remained competitive and maintained its market share in most key markets by improving the quality and capacity of its network."
Meanwhile, data services were the key driver of the group's revenue growth and increased their contribution by 3.1 percentage points, to 15.1%. "The number of data users increased by 37.4% to 80.6 million, as we expanded our 3G networks and stimulated the adoption of data-enabled devices and smartphones.
"At the end of December, we had 34.8 million smartphones on our network, an increase of 59% on the previous year.
"We expect the recent launch of our own affordable 'Steppa' smartphone to quicken the pace of smartphone penetration. Managing tariffs in the data environment remains a key focus," says MTN.
The operator says group interconnect revenue declined by 4.4%, following a cut in termination rates in its Nigerian and South African operations. These two operations accounted for 52% of total group interconnect revenue.
The 24.9% decline in South African interconnect revenue and the 23% decrease in Nigerian interconnect revenue resulted in a 6.5 percentage point decline in the group's interconnect margin, to 17.7%, the company explains.
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