-Total subscribers increased by 1.6% to 80.9 million
-Active data users increased by 7% to 47.7 million
-Service revenue increased by 35.9% to N3.3 trillion
-Earnings before interest, tax, depreciation and amortization (EBITDA) increased by 9.2% to N1.3 trillion
-EBITDA margin decreased by 9.6 percentage points (pp) to 39.1%
FRI FEB 28 2025-theGBJournal| MTN Nigeria Communications Plc (MTN Nigeria) Friday announced its audited results for the year ended 31 December 2024, reporting service revenue increase of 35.9% y/y to N3.33 trillion for the period under review (Q4-24: +41.7% y/y to N980.52 billion).
The earnings was driven by broad-based growth across voice (+14.5% y/y; 39.0% of revenue), data (+49.1% y/y; 47.8% of revenue), digital (+95.2% y/y; 2.2% of revenue), fintech (+23.2% y/y; 3.2% of revenue), and other services (+108.0% y/y; 7.8% of revenue) channels.
Additionally, non-service revenue, which includes earnings from device and SIM card sales, surged by 83.8% y/y to N25.92 billion.
Consistent with recent trends, the data segment remained the primary growth driver, benefitting from rising consumer demand for high-speed internet services and an expanding user base.
Specifically, the company recorded a 42.9% y/y increase in data traffic, driven by a surge in average monthly data usage per customer, which rose by 33.6% y/y to 11.2GB (Q4-24: +37.9% y/y to 13.2GB), highlighting increased digital adoption.
The growth in data consumption was further supported by wider smartphone penetration (+270bps y/y to 58.2%) and network expansion with MTNN’s 4G coverage now reaching 82.4% of the population (+90bps y/y), while 5G coverage expanded to 12.7% (+150bps y/y).
Meanwhile, the total data subscriber base increased by 3.10 million to 47.70 million in 2024 (Q4-24 net addition: +2.40 million), despite disconnections stemming from the NIN-SIM linkage directive. Furthermore, the company added 1.20 million new home broadband subscribers, pushing its total home broadband user base to 3.2 million.
Voice revenue also recorded growth, which management attributed to increased usage and an expanding user base.
Despite regulatory-driven disconnections linked to the NCC’s NIN-SIM linkage directive, the company’s total subscriber base grew by 1.20 million to 80.90 million in 2024, with a notable Q4-24 net addition of 3.90 million subscribers, signaling a recovery in subscriber acquisitions.
Meanwhile, the growth in value-added services, including digital and fintech offerings, was driven by greater adoption of MTN Xtratime and other digital products.
Meanwhile, MTNN’s mobile money (MoMo) segment recorded a 4.3% y/y increase in transaction volume, despite a 46.6% y/y decline in active MoMo wallets to 2.8 million and a significant reduction in its agent (-76.8% y/y) and merchant (-79.2% y/y) network.
These declines reflect the company’s strategic sales force optimization, which is centered on deepening service penetration, enhancing monetization, and reducing acquisition costs.
Further down, total expenses increased by 61.7% y/y (Q4-24: +33.9% y/y), driven by inflationary pressures, higher energy costs (+43.4%), and naira depreciation (-40.1%).
These macroeconomic headwinds significantly impacted the company’s operating costs, particularly tower lease expenses, which rose sharply by 92.8% y/y to N969.32 billion. The faster increase in expenses relative to revenue led to a 963bps y/y contraction in EBITDA margin to 39.1%.
However, the successfully renegotiated lease contracts with IHS generated cost savings and supported EBITDA margin in H2-24, particularly in Q4-24, where EBITDA margin improved to 45.8% (+342bps y/y | +816bps q/q).
Elsewhere, net finance costs surged by 90.1% y/y to NGN403.21 billion (Q4-24: +75.3% y/y to NGN119.21 billion) reflecting higher interest expense on leases (+144.7% y/y) and borrowings (+37.1%).
These increases were primarily driven by naira depreciation and the addition of new lease obligations totaling N901.00 billion, arising from the renewal and extension of tower lease contracts.
Similarly, net FX losses grew by 25.0% y/y to NGN925.36 billion reflecting the continued impact of the weaker naira and a 95.0% reduction in the company’s outstanding foreign currency Letter of Credit (LoC) debt, which fell from USD416.60 million to USD20.80 million.
This paydown accounted for c.86.0% (NGN483.23 billion) of the N561.94 billion in realised FX losses. However, in Q4-24, net FX losses declined significantly by 92.3% y/y to NGN20.43 billion, reflecting the positive impact of lower FCY exposure following the substantial reduction in outstanding FCY debt.
The telecoms giant equally reported a pre-tax loss of N550.33 billion in 2024FY (vs a pre-tax loss of N177.89 billion in 2023FY), and after accounting for a tax credit of N149.89 billion, the company posted a net loss of N400.44 billion for the year (2023 net loss: N137.02 billion).
Meanwhile, in Q4-24, the company reported a profit before tax of N163.31 billion (Q4-23 loss before tax: N168.04 billion) and profit after tax of NGN114.49 billion (Q4-23 loss after tax: N122.03 billion).
Reflecting on the company’s earnings performance, CEO Karl Toriola was bullish while hailing the resilience of the business in FY 2024
”Despite facing significant macroeconomic headwinds, including record high inflation, as well as ongoing currency and energy price volatility, we remained focused on executing our strategy and creating long-term value for our stakeholders,” Toriola said,
He said the company is grateful to the authorities for the recent approval of tariff adjustments, ”which are essential for our industry’s sustainability and crucial for addressing our negative capital position.”
Looking ahead, Toriola said MTNN will continue its work to drive sustainable growth and operational resilience. Our primary focus is to restore a positive net asset position in the current financial year.
”The recent approvals of new tariffs by the regulator will enable us to sustain the required investments in our networks, which are needed to enhance customer experience and
safeguard the sustainability of our business and industry.
In light of the developments in our operating context, we expect FY 2025 service revenue growth of ‘at least mid-40%’ as tariff adjustments take effect.
We also anticipate an EBITDA margin of ‘at least mid-40%’ and capex intensity in the ‘upper teens’, in line with our disciplined approach to capital allocation”
He noted that the company have reinstated a revised medium-term guidance framework for its business.
”We expect service revenue growth of ‘at least 20%’ and a recovery in our EBITDA margin to ‘at least 50% over the medium term.
We also anticipate capex intensity subsiding as it normalises over the medium term, following the expected acceleration in our capex deployment in 2025 to enhance network capacity, digital inclusion and customer experience.
In terms of our balance sheet, we aim for a recovery in our retained income and shareholders’ equity positions to positive balances within the next 12 months,” he added.
X-@theGBJournal|Facebook-the Government and Business Journal|email:gbj@govbusinessjournal.com|govandbusinessj@gmail.com
