Growth in data, Fintech incomes cushion MTN’s declining voice revenues
Ms Sylvia Mulinge
What you need to know:
- During the quarter to March, data subscribers grew by 25 percent to 6.7 million, while active Fintech subscribers rose by 14 percent to 10.9 million
Growing revenues from data and financial technology (Fintech) cushioned a decline in MTN’s voice income to register an increase in service revenues for the period ended March.
Voice remains MTN’s largest revenue earner but has been under pressure, registering declines or flat growth in the last five years.
Details published in its financial results for the quarter ended March, MTN reported a 15.8 percent increase in service revenue, driven by data and Fintech.
For instance, during the period, data subscribers grew by 25 percent to 6.7 million, while active Fintech subscribers rose by 14 percent to 10.9 million.
Revenue from Fintechs, as a contribution to service revenues, increased by 28.1 percent from 27 percent (174.8b from Shs144.7b) while that from data rose to 25.7 percent to Shs145.269b.
The strong growth in the MTN Uganda revenue was also underpinned by a strong recovery in voice revenue, which all together helped the company to register services revenue of Shs115.5b.
However, revenue from voice, as a contribution to general service income, declined to 44 percent from 46.8 percent, falling to Shs272.9b.
Overall, MTN indicated that during the period, service revenues rose to Shs621.1b in the three months to March from Shs536.3b.
In notes published along the financial results, Ms Sylvia Mulinge, the MTN chief executive officer, said the growth was driven by a growth in subscriber numbers, which during the period, grew by 11.6 percent to 17.8 million.
The mobile money ecosystem, she said, doubled merchant numbers to 268,000 while agent numbers remained flat at 164,000, which supported a 26.5 percent increase in the number of transactions to 753 million while transaction value grew by 35.5 percent to Shs28.5 trillion.
During the period, MTN indicated, customer net additions stood at 600,000 due to improvements in service offering and affordability, which saw an 11.6 percent growth in MB per active data users, while smart phone penetration improved to 34.7 percent.
The growth saw MTN report a 20 percent growth to Shs120.6b in profits after tax while total assets increased to Shs4.1 trillion from Shs3.5 trillion in the same period last year.
