MTN Nigeria posts 4.7% decline in profit after tax

MTN Nigeria posts 4.7% decline in profit after tax

MTN Nigeria Plc has recorded a profit after tax of N94.88bn for the half-year ended June 30, 2020 as against N99.537bn reported in 2019, accounting for a drop of 4.7 per cent.

Profit before tax stood at N139.570bn from N142.404bn in 2019, a two per cent drop.

The telecom firm reported half year revenue of N637bn in 2020 compared to N566.9bn reported in the same period last year.

The 12.5 per cent revenue increase was driven by growth in data revenues in the first and second quarters of the year.

The company reported a 57.6 per cent growth in data revenue in the half-year of 2020 as its Nigerian customers bought more data in the during Covid-19 economic shutdown.

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Commenting on the report, MTN Nigeria Chief Executive Officer, Ferdi Moolman said, following a strong first quarter, the company experienced a challenging operating environment in the second quarter characterised by COVID-19 induced lockdowns and the broader macro-economic impact.

Despite this, Moolman said MTN Nigeria maintained double-digit service revenue growth of 12.6 per cent for H1, driven by strong growth in our key revenue lines.

He added that data revenue rose by 57.6 per cent supported by an increase in data users and traffic.

He said, “Revenue from digital and fintech services rose by 121.8 per cent and 29.6 per cent, respectively, while voice revenue growth was 2.8 per cent amidst a change in traffic pattern following the lockdowns.

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“However, costs also increased leading to an overall decline in profit before tax and earnings per share. In the first half of the year, we achieved 6.8 million in net additions, to connect over 71.1 million customers to our network. We also connected 3.8 million new users to the Internet, bringing our active data subscribers to 29m.

“Our MoMo subscribers increased by 1.6m to 2.2m, the majority of which were in Q2.”

According to Moolman, the company prioritised the upgrade of its network capacity to accommodate growth in traffic, while continuing to expand 4G network coverage, albeit at a slower pace given the constraints presented by COVID-19.

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