MTN Nigeria's Profit Plunges Amid Naira Devaluation, Tariff Hikes Planned
MTN, a leading telecommunications company in Nigeria, has faced significant financial challenges due to a substantial devaluation of the naira. By December, the currency had lost 96.7% of its value, leading to a post-tax loss of ₦135 billion ($101 million) for MTN Nigeria. The company has since announced plans to increase tariffs on voice and data services.
MTN Group's headline earnings per share (HEPS) dropped by 72.3% to 315 cents in the year ending December 31. Despite this, the company reported a 13.5% increase in revenue to R210 billion ($11 billion), with data revenue contributing R84 billion ($4.4 billion) and voice revenue R83 billion ($4.3 billion). MTN MoMo totaled R21 billion ($1.11 billion).
MTN Nigeria is negotiating with partners like IHS Holding Ltd., ATC, and Eaton Towers to reevaluate contracts with cell tower operators. The company is also seeking approval for tariff increases to offset operational costs. CEO Ralph Mupita stressed the need for these increases to improve profitability and financial standing. In January, MTN Nigeria reported a pre-tax loss of ₦177.8 billion, largely due to foreign exchange losses.
MTN Group's revenue and subscriber rates increased in 2023, despite operational challenges. The company aims to mitigate cost escalations and improve profitability through tariff increases, which are currently under review with regulatory bodies in multiple markets.
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