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MTN SA hits high notes in Q1 performance

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Ralph Mupita, MTN Group CEO.
Ralph Mupita, MTN Group CEO.

MTN SA ticked green on key performance metrics in the quarter ended March, yielding growth in all its core business units.

The operator closed the quarter with a total of 34.5 million subscribers, an increase of 7.1%, which it says was driven by higher gross additions.

The postpaid subscriber base continued to expand, with an increase of 7.4% to 7.5 million on the back of solid growth in integrated voice and data-centric plans.

The operator also achieved a 7% increase in prepaid subscribers to 27 million.

MTN Group today reported solid performance for the quarter, with key markets SA and Nigeria anchoring the Pan-African mobile operator.

For SA, MTN Group president and CEO Ralph Mupita, says: “This performance shows the resilience of the business, against the backdrop of a challenging macro-economic environment, with a rapidly rising unemployment rate, and increased pressure on consumer disposable income. This environment has contributed to a notable shift in customer spending patterns and greater competition for share of the consumer’s wallet.”

In the quarter, the telco says its drive to grow mobile data revenue in SA led to data traffic growth of 46.7% and a 14.1% increase in active data users to 17.3 million.

This, Mupita says, underpinned a 14.3% increase in overall mobile data revenue.

“Data was made more affordable in the quarter with a 22.8% year-on-year (YOY) reduction in the effective data tariff. An active prepaid data subscriber now consumes an average of 4GB of data a month, up 37% YOY, and an active postpaid data subscriber uses nearly 11.8GB per month, an increase of 20%. The consumer postpaid business delivered a resilient performance, with service revenue growth of 4.4% benefiting from data-oriented packages.”

In the quarter, MTN SA’s enterprise business recorded a 23.1% increase in service revenue, driven by growth in data deals, bulk SMS and the ICT business.

Wholesale revenue increased by 1.9%, supported by national roaming deals with Cell C and Telkom.

Turning to its growing fintech business, Mupita says the performance was encouraging, with approximately five million registered Mobile Money (MoMo) users and 840 043 monthly active users by 31 March.

“MTN SA also progressed work on MoMo partnerships to accelerate the growth of the business. The platform continues to grow transactions driven by innovative and relevant solutions.”

Looking ahead, he says, MTN SA is focused on accelerating its high growth business areas, with ongoing emphasis on the overall expense efficiency programme to deliver strong EBITDA and cash flow growth.

Bankable market

Turning to Nigeria, the group’s biggest and most lucrative market, Mupita says MTN delivered through solid commercial momentum and execution in challenging trading conditions.

“MTN Nigeria recorded a solid Q1 2022 performance, tracking positively against its medium-term targets, with 22% growth in service revenue and the expansion of EBITDA margins.”

Voice revenue grew by 8.6%, which MTN says was driven by an increase in gross connections and higher usage from the active SIM base.

Data revenue rose by 54% and digital revenue grew by 37.4%, while revenue from the enterprise business surged by 34%.

Home broadband penetration, which is a focus for MTN Nigeria, reached over 775 000 users, up by over 160 000 in the comparable period.

MTN Nigeria fintech revenue also rose by 46.7% on the back of the growing adoption of fintech services and an expanded user base.

“The MoMo agent network continues to widen, with more than 800 000 registered agents and over 166 000 active agents (agents who perform a minimum of 10 revenue-generating transactions within 30 days),” says Mupita.

“Having established a significant foundation of the registered agent network, the focus is now on scaling the active base. Agent services have been extended to include card withdrawal services by deploying point-of-sales terminals to the agent network.

“This has contributed to growing total volume of transactions to over 56.1 million, up 132.7% YOY, by more than 10.7 million active users (up 135.2%).”

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