MTN Nigeria Communications Plc (MTN Nigeria) has announced its audited results for the financial year ended December 31, 2020 with Profit before tax (PBT) growth of 2.6% to N298.9 billion and Earnings before interest, tax, depreciation, and amortisation (EBITDA) growth of 9.7% to N685.7 billion.
The report, which was published by the telecom firm further indicates that the company’s Financial Technology (Fintech) revenue rose by 27.3%, boosted by MTN Xtratime, its airtime lending service. The company expanded its MoMo agent network with the addition of over 280,000 registered agents during the year. “This was achieved as we continued to convert our traditional airtime agents in line with our one distribution model. Our fintech subscribers increased by more than eight times to 4.7 million, driving higher transaction volumes of over 51.5 million during the year and core fintech revenue growth of 28.0%.”
There was also an increased uptake of MTN Fintech services with transaction volume in April 2020 rising by more than three times above the March 2020 level to 4.3 million, and the momentum continued to increase to year end.
Speaking on the result, MTN Nigeria CEO, Ferdi Moolman said: “2020 was a challenging year for all. The unprecedented disruption that the COVID-19 pandemic caused the businesses and people we serve, challenged us in new and demanding ways. The impact continues to evolve. Adoption of our data and digital services accelerated as lockdowns and gathering restrictions were imposed, and work-from-home became the norm for many.
Our employees adapted quickly to working remotely to ensure that our customers remained connected. I am incredibly proud that we were able to meet the challenges faced in 2020, by pulling together, working closely with the government and our regulators, and understanding our customers’ evolving needs.”
The company enumerated some of the measures it has taken to aid the fight against the COVID-19 pandemic, which it packaged as a N25 billion Y’ello Hope initiatives. According to the report: “We provided free-to-access services (including SMS and data) to the most vulnerable, supported the acquisition of essential medical supplies (tests and personal protective equipment), and joined the Coalition Against COVID-19 (CACOVID) that drove multiple initiatives, including building isolation centres across the country. We also paid our taxes early in support of government’s ongoing efforts. In January 2021, MTN Group partnered with the African Union contributing US$25 million to their COVID-19 vaccination programme. MTN Nigeria is pleased to play its part in this initiative, through which Nigeria will receive 1.4 million vaccine doses for the benefit of health workers.
In addition, the company said it committed marketing resources to its #WearItForMe campaign to help create awareness around wearing masks, and the REVV support programme for Micro, Small and Medium Enterprises (MSME) helped them navigate the new digital reality.”
Attributing the company’s performance to its strong operational execution and resilience in business, Moolman, who steps down as MTN Nigeria CEO today, announced that MTN Nigeria connected 12.2 million new customers to its network, bringing total subscriptions to 76.5 million as at December 31, 2020.
He however noted that introduction of additional customer registration requirements and suspension of the sale and activation of new SIMs towards the end of the year affected subscriber growth.
Further “Active data users increased by 7.4 million to 32.6 million, supported by growth in gross connections and the expansion of our 4G network. Our mobile money (MoMo) business also continued to accelerate with a 269.2% increase in the number of registered agents to over 395,000 and 4.7 million active subscribers from approximately 553,000 in 2019.
Service revenue grew by 14.7%, in line with our medium-term targets, driven mainly by voice and data revenue. Voice revenue growth was 5.9%, and although this was subdued in Q2 due to COVID-19 induced restrictions, we saw a pickup in momentum into H2. Data revenue rose by 51.2%, with increased data usage and traffic. To accommodate this and enhance service quality, we focused on capacity upgrades and 4G population coverage, while expanding our investments in rural connectivity. Our 4G network now covers 60.1% of the population, up from 43.8% in 2019.”
The report revealed that the company’s EBITDA rose by 9.7%, supported by service revenue growth. However, the EBITDA margin declined by 2.5pp to 50.9%. This, it stated, was mainly due to increased operating expenses, arising from the rollout of new sites and the impact of Naira depreciation, affecting in particular the costs of company lease contracts. “Despite the increase in costs, we recorded an improvement in our bottom-line earnings, with profit before tax (PBT) and profit after tax (PAT) increasing by 2.6% and 0.9% respectively.”
The company said it will continue to invest in network site expansion, Fintech and fast track 4G sites rollout to further increase population coverage, while working with relevant authorities on NIN enrolment and curbing the effect of the pandemic.
