By Dipo Olowookere
The net profit of MTN Nigeria Plc suffered a 3.3 per cent decline in the first nine months of this year, the financial statements of the company have revealed.
The profit after tax went down to N144.2 billion as at September 30, 2020, from N149.2 billion it closed on September 30, 2019, the results indicated.
This decrease in profit came despite the double-digit growth recorded by the total revenue generated in the period under consideration, rising by 13.9 per cent to N975.8 billion from N856.6 billion.
An analysis of the major contributors to the earnings showed that voice accounted for N645.5 billion versus N628.3 billion, indicating a 4.2 per cent growth.
Business Post observed that data revenue increased by 57.0 per cent to N241.6 billion from N153.9 billion, digital revenue went up by 114.3 per cent to N6.7 billion from N3.1 billion, fintech grew by 28.3 per cent to N32.4 billion from N25.2 billion, while other service revenue went down by 13.1 per cent to N38.6 billion from N44.5 billion.
It was further observed that with 19.5 per cent rise in expenses to N478.0 billion from N400.1 billion, 9.1 per cent year-on-year jump in EBITDA to N497.9 billion from N456.4 billion and a 32.9 per cent increase in the net finance costs to N95.4 billion from N71.8 billion, the profit before tax slightly decreased by 0.6 per cent to N211.6 billion from N212.9 billion.
“The year 2020 has been challenging for everyone,” the CEO of MTN Nigeria, Mr Ferdi Moolman, said, adding that, “The COVID-19 pandemic was first reported in Nigeria during the first quarter of 2020 and the country has, to date, registered over 62,000 cases and over 1,100 deaths according to the Nigeria Centre for Disease Control (NCDC).”
He noted that, “Through all these, we recognise that we must keep rising the best way we have learnt to do, which is together. That is why our priorities have remained focused on continuing to provide and invest in a network that brings people together and provides a platform for everyone’s voice to be heard.”
“During the period under review, we saw volatility in both voice and data revenue, affecting the trajectory of our overall service revenue, as well as pressure on costs, which continues to impact our operating margins, dampening profitability,” Mr Moolman stated.
“Following a decline in voice traffic and an acceleration in data during lockdowns in Q2, we have seen a normalisation of traffic as restrictions have been removed, with a recovery in voice traffic and continued growth in data. This has supported a 13.9 per cent growth in service revenue, with an acceleration of growth to 16.5 per cent in Q3 specifically,” he added.
However, he assured that the company will “continue to build on our operational and financial resilience and execute on our strategy to position the business for sustained growth over the medium and long term.”
