MTN Nigeria records 79.7% surge in profit on impressive revenue growth

MTN Nigeria records 79.7% surge in profit on impressive revenue growth

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The world being a global village, which has necessitated the need for data purchase for internet access to connect with everyone, has paid off for MTN Nigeria as its revenue hit N1 trillion from rapid growth in data purchase by Nigerians.

Evident in the financial statement of MTN Nigeria published on the Nigerian Stock Exchange (NSE) market as a requirement for a listed firm, growth in data income in 2018 outperformed growth in other sources of revenue for the Telco giant.

The data stream of income recorded a 41 percent growth from N116.7 billion in 2017 to N165.1 billion in 2018. Revenue from data purchase as at 2018 stood as the second largest stream of income for MTN. This accounted for about 16 percent of total revenue from contract with customers.

The first remains revenue from Airtimes and subscriptions which accounted for 65 percent for the year ended 2018.

During the period, MTN recorded a 17.12 percent growth in total revenue from N887 billion in 2107. This therefore translated to an improved profit margin of 14 percent in 2018 against 9 percent in 2017.

The biggest non-oil foreign direct investment (FDI) in Nigeria grew its profit after tax (PAT) by 79.7 percent to N145.68 billion in 2018 against N81.07 billion in 2017.

In 2018, the ultimate holding company of MTN group limited entered into a settlement agreement for compensation in respect of losses arising from the breach of contract with Zhongxing Telecommunications Equipment (ZTE) as reported in the financials.

In terms of the agreement, ZTE agreed to provide specific discounts and free goods to the value of $26.7 million to MTN group limited and its operating companies.

MTN Nigeria accounted for this transaction ($5.8 million) as other income measured at the fair value of the free and discounted goods.

To this end, other income stood at N2.22 billion in 2018 against no income recorded in 2017.

The entrance of MTN’s listing by introduction on the NSE market saw existing shareholders of MTN grow their wealth by N763.12 billion in market value to N2.77 trillion as at the end of trading on Friday.

Analysts are optimistic however that fundamental of the company remain very strong with future growth potentials looking promising.

Recent development in the company reveal that the Telco giant has identified Ethiopia as a rare new market into which Africa’s largest wireless carrier wants to expand.

 

David Ibidapo



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