South Africa-based MTN Group has published a trading update for the nine months ended 30 September 2019, highlighting group service revenue increased 9.6% year-on-year, with an earnings before interest, tax, depreciation and amortisation (EBITDA) margin of 41.1% (9M18: 35.1%). The emerging market mobile operator said that gains were fuelled by double-digit service revenue growth in Nigeria and Ghana, although it noted that in its home market, MTN South Africa service revenue increased by just 0.4% y-o-y, with an EBITDA margin of 36.6% (9M18: 33.2%).
‘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,’ said president and CEO Rob Shuter. ‘MTN SA continues to account for Cell C roaming revenue on a cash basis, and payments received since June 2019 have remained on schedule. A change in the accounting treatment back to recognising revenue on an accrual accounting methodology, will occur upon adequate resolution of Cell C’s liquidity challenges,’ he added.
‘Across the group, we are on track with delivering our strategy. This is reflected in ongoing voice, data and fintech revenue growth of 4.4%, 21.5% and 30.9% respectively. Digital revenue declined by 46.4% as we continued to optimise our legacy value added services (VAS) business. In Nigeria we have achieved a return to positive q-o-q digital revenue growth following completion of the VAS optimisation in that market,’ said Shuter.
Operationally, group subscribers increased by a net 3.5 million quarter-on-quarter to 243.7 million at 30 September 2019, as active data subscribers increased 4.7 million q-o-q to 87.0 million and active MTN Mobile Money customers increased by 2.2 million q-o-q to 31.7 million. Commenting on MTN’s operational development, the CEO noted: ‘We have recorded 515 000 monthly active users on our Ayoba messaging platform, now launched in five markets, namely South Africa, Uganda, Ivory Coast, Cameroon and Congo Brazzaville. We have commenced scaling our MoMo agency network in Nigeria under our super-agent licence with 66,282 agents now registered. We continue to engage the Central Bank of Nigeria on our application for a payment service bank licence.’