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MTN Group records E57.3billion revenue

Business Section


MBABANE – Despite the prevailing global economic downturn that affected markets worldwide, the MTN Group has reported a satisfactory set of financial results for the six months ended June 30, 2009.

The Group’s revenues increased by 24.2 per cent to reach E57.3 billion from E46.1 billion during the same period last year. This is according to a press release from the MTN Group Corporate Affairs. “The MTN Group revenues increased by 24.2 per cent to E57.3 billion from E46.1 billion last year, largely driven by the strong growth in subscribers since June 2008,” the report says.

The Group’s mobile subscriber base passed the 100 million milestone during the period, with 103.2 million subscribers as at June 30, 2009. “This is a 14 per cent increase since December 31, 2008. Subscribers have increased by 39 per cent since June 30, 2008,” it says. MTN Group President and Chief Executive Officer Phuthuma Nhleko said: “Notwithstanding the economic downturn, this is a satisfactory set of results achieved through the successful execution of our operating strategy which is underpinned by a sound business model of strategic investment choices, strong corporate governance and effective management across MTN’s global footprint.”

On prospects, Nhleko said; “While many of our markets remain relatively vulnerable to the global economic downturn, there are some indications that conditions may be starting a slow recovery. Competition across MTN’s footprint is likely to continue to increase.” Just a few days ago, MTN Swaziland’s CEO Tebogo Mogapi said the company had not been heavily affected by the prevailing global economic meltdown. Mogapi said, even though he could not discuss the MTN financials then, he was positive that they were ‘riding the wave of the financial crisis’.

“We have not been impacted that heavily by what is happening; we are holding on by our strings. We do appreciate, however, that we may be affected in the coming months, but not to the extent of being forced to make serious decisions. There will be ripple effects of the crisis in the next few months, but we are hopeful that the effects won’t be bad,” he said. Meanwhile, reported revenue and EBITDA results, when compared to the prior six month period ended June 30, were not materially impacted by movements in currencies in the majority of countries in which we operate against the Rand.

“However, growth in earnings was negatively impacted by functional currency losses of E2.8 billion (June 2008: E0.9 million gain) on shareholder loans, receivables and cash,” it says. On another note, the MTN Group’s assets decreased by 14 per cent to E146 billion compared with E170 billion at December 31, 2008. “This was largely as a result of the depreciation of the closing rate of the respective local currencies against the Rand,” it says. Group basic earnings per share (EPS) increased by 22.4 per cent to 409.7 cents per share compared to June 30, 2008. Adjusted headline EPS decreased to 363,8 cents, 10.9 per cent lower than at June 30, 2008. The report adds that although competition increased in most markets following the entry of new players, execution of the operational strategy had generally proved successful.

It says; “MTN’s network expansion and capacity investment strategy initiated in 2008 also supported the strong performance of the Group’s subsidiaries, particularly where competitors have elected to scale back on investments. Enhanced distribution channels and attractive value propositions also contributed to the positive performance.”

The Group reports its performance by region, namely South and East Africa (SEA), West and Central Africa (WECA) and the Middle East and North Africa (MENA). MTN consolidates 49 per cent of MTN Irancell’s financials.

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