MTN Group’s CEO Ralph Mupita has indicated that the company is on the mend, particularly with its Nigerian operations rebounding after facing significant challenges. Following a devaluation of the naira, the group reported an annual pre-tax loss of US$242 million.
Nigeria’s economy has dealt with chronic dollar shortages, prompting authorities to devalue its currency to stabilise the financial landscape and attract foreign investment. Compounded by soaring inflation and interest rates, these factors have significantly increased operational costs. MTN Nigeria’s pre-tax losses escalated over 200% to a staggering US$352 million.
At the group level, MTN recorded a total pre-tax loss of US$242 million for the year ending December 31, a decline from a profit of US$661 million in 2023. To counter these financial challenges, MTN Nigeria is implementing several strategies, including renegotiating tower leases and a recently approved tariff increase to restore profitability.
Mupita expressed optimism during a recent media call, stating, “The pain we’ve endured for the past 18 months is easing. The business is experiencing robust growth, and I am confident in a strong recovery in Nigeria.”
With a customer base of 291 million across 16 African countries, MTN has cut US$209 million in costs, including US$66 million from renegotiated tower leases, according to CFO Tsholofelo Molefe.
MTN has faced serious disruptions in Sudan due to ongoing armed conflict, leading to impairments totalling US$644 million. However, Mupita noted that the company is beginning to restore service in affected areas, including Khartoum, where its network had been non-operational since April 2023.
Peter Takaendesa, head of equities at Mergence Investment Managers, commented on the company’s underlying performance, indicating strong service revenue growth in constant currency. “The management team is executing effectively, but they are contending with macroeconomic and currency challenges beyond their control,” he stated.
Overall, while group service revenue fell by 15%, it increased by 14% in constant currency terms, highlighting MTN Group’s resilience amidst challenging economic conditions.
