Data, mobile money shore up MTN profits to Shs406b
MTN has posted massive growth in revenues from mobile money and data. Photo / File
What you need to know:
- Mobile money pay was the biggest driver, earning more revenues due to an expansion in merchant numbers, which grew threefold to 173,000 supported by customer transition to cashless payments.
MTN has posted Shs406b in profits due to growth in revenues from internet data and financial technology services such as mobile money.
The telecom also grossed Shs2.2 trillion in revenues, registering growth in all its revenue streams, save for voice, which even after registering a decline, remained MTN’s largest revenue stream.
During the period ended December 2022, according to details contained in the telecom’s financial results, data revenues grew by 24 percent to Shs511b supported by increased investment in 4G and expansion of the fibre network to 9,418 kilometres, while financial technology, which includes mobile money and Fintechs, increased by 25 percent to Shs565b due to growth in payments, bank interface and remittance lines.
Mobile money pay was the biggest driver, earning more revenues due to an expansion in merchant numbers, which grew threefold to 173,000 supported by customer transition to cashless payments.
Voice revenue, recorded a marginal decline of 0.5 percent, but remained the highest revenue source, contributing Shs1.1 trillion on MTN’s bottom line.
Ms Sylvia Mulinge, the MTN chief executive officer, attributed the decline to the continued macroeconomic pressures such as the rising inflation, which impacted customer spending.
Ms Mulinge also admitted that the growth was delivered during a challenging period, characterized by an increase in inflationary pressures, weakening of the shilling and an increase in interest rates.
Mulinge, who joined MTN at the end of last year, however, said the company’s operational efficiencies led to the increase in total costs to only 10.5 percent, and underpinned by its higher service revenue.
Stephen Kaboyo, the Alpha Capital managing partner, said MTN financials were ‘impressive’ coming against economic headwinds that have hit many businesses.
“Further analysis of the MTN financial results indicate growth across all segments of the business, underpinned by substantial investment in technology upgrades which is key for the company to maintain their competitive advantage,” he said, noting that the performance will be good news to shareholders.
MTN has declared a dividend payout of Shs5.5 per share.
In October 2021, MTN floated 4.5 billion shares with a par value of Shs1 at an offer price of Shs200 each, which has since dropped to Shs175 at the Uganda Securities Exchange.
Large shareholders
National Social Security Fund (NSSF), is MTN’s second largest shareholder with a stake of 8.84 percent. MTN International (Mauritius) remains the largest shareholder with a stake of 83.05 percent.
NSSF is followed by Charles Mbire with a 3.99 percent stake, NSSF - Sanlam (0.26 percent), Bank of Uganda Defined Benefits Scheme - Sanlam (0.19 percent) National Social Security Fund (Kenya) - Sanlam (0.18 percent) and Duet Africa Opportunities Master Fund (0.13 percent).
