Latest news with #MTNUganda
IOL News
07-05-2025
- Business
- IOL News
MTN Uganda reports strong first quarter performance amid regulatory changes
MTN Uganda has reported a resilient financial performance for the quarter to March 31, 2025, in spite of regulatory changes. Image: REUTERS/Esa Alexander/File Photo MTN Uganda navigated changes in the regulatory environment in the first quarter to end-March and it remains on track to meet medium-term guidance, the CEO Sylvia Mulinge said Wednesday. The business headwinds were cushioned by supportive macroeconomic conditions, a stronger shilling that appreciated 5.7% against the US dollar, and stable headline inflation which averaged 3.6%, only slightly higher than the 3.2% average in the first quarter of 2024, and marginally higher than the 3.1% of the fourth quarter of 2024. Earnings before interest, tax, depreciation, and amortisation (EBITDA) increased by 13.7% year-on-year supported by a resilient revenue performance and moderate 12.2% cost growth. MTN contributed over 13% of MTN Group's EBITDA in 2024. Profit after tax was up by 20.6% to Ush 180.9 billion. 'Despite the regulatory MTR (mobile termination rate) changes, we are pleased with the solid strategic execution that supported growth in other areas of our business, while ensuring margin resilience and value preservation in our operation,' Mulinge said. A focus on customer centricity enabled the subscriber base to grow to 22.8 million in the quarter. Data and fintech subscribers increased by 19.4% and 9.8% respectively. Service revenue grew by 13.5%, with stronger contributions recorded from data and fintech portfolios. In the connectivity business, an interim industry-wide directive from last year relating to the reduction in MTR from Ush 45 to Ush 26, impacted voice outgoing revenues in the quarter. 'To ensure resilience of our portfolio, we intensified our customer value management (CVM) and improved our bundle offering and service proposition to our customers,' said Mulinge. On the data front, smartphone penetration was invested in by enhancing the affordability of devices through the Pay Mpola Mpola program and device purchase subsidies through partners. This helped to increase the number of smartphones in use by 9.8% on the network. Data revenue accelerated by 32.5%, anchored by a 19.4% growth in active daily users to 10.2 million, indicating 1.7 million in net additions year-on-year.
Zawya
21-04-2025
- Business
- Zawya
South Africa: MTN Group nets $30mln from sale of 1.5bn shares in Ugandan subsidiary
South Africa's MTN Group Ltd made a net gain of R564 million ($29.76 million) from the sale of its 1.57 billion shares in the Ugandan subsidiary despite offering the stake at a substantial discount in a bid to comply with a requirement to offload a minimum stake of 20 percent to minority investors. Latest disclosures through the company's audited financial statements (2024) show that the proceeds generated from the sale of the shares (net of taxes and transaction costs) amounted to R1.03 billion ($54.67 million) resulting in a net gain of R564 million ($29.76 million).'Proceeds generated from the sale of shares, (net of taxes and transaction costs) amounted to Ush214 billion (R1 036 million). This resulted in a net gain of R564 million recognised in equity as a transaction with non-controlling interests,' the group says. The group disposed of 7.03 percent stake equivalent to 1. 57 billion shares in MTN Uganda as part of its localisation plan that reduced its shareholding in the subsidiary to 76.02 percent from 83.05 percent. The transaction which was completed in June last year (2024) came after the group managed to sell a 12.97 percent stake in MTN Uganda in November 2021 through an initial public offering (IPO) that was priced at Ush200 ($0.05). The share sale in the secondary market aimed to help MTN comply with Uganda's local ownership rule that requires foreign telcos operating in the country to cede at least 20 percent shareholding to the public through the stock market. The offer which ran between May and June 10, 2024, was priced at discount of Ush170 ($0.04) per share compared to the original IPO price of Ush200 ($0.05) per share. The company also offered 30 free shares for every 140 shares allocated with the incentive shares amounting to a significant discount and making the secondary offer more generous than the IPO. Consequently, the sale of the additional shares was oversubscribed by 2.3 times, receiving subscription of three billion shares, reflecting the impact of the incentives that included free shares. In 2019 the Ugandan government directed foreign-owned telecoms operating in the country to list at least 20 percent of their shares on the local bourse within two years to boost Ugandan ownership in the sectorThe policy shift put pressure on multinationals operating in the country such as MTN, Airtel and Lycamobile to sell shares to the public. President Yoweri Museveni complained that the country was draining its scarce foreign exchange reserves through foreign-owned telecoms repatriating their profits abroad. Last year Airtel Africa Plc disclosed that it will also sell additional shares amounting to a 9.11 percent stake in its Ugandan subsidiary through a secondary offer to comply with Kampala's listing requirements. The multinational in November 2023 managed to sell 4.35 billion shares equivalent to a 10.89 percent stake in Airtel Uganda's initial public offering (IPO) and failed to meet the ownership rule. Airtel Africa said it had received a regulatory extension to sell the balance of 3.64 billion shares by November 2026, a move that will see it replicate MTN group which successfully offloaded a 20 percent stake in MTN Uganda in two transactions including a secondary offer conclude in June 2024Airtel Africa sold its shares at a price of Ush100 ($0.02) per share in the IPO that also offered incentive shares on a band subscription volume to attract investors. Retail investors who applied for more than 2,500 shares, for instance, received 10 free shares for each 100 shares allocated while institutional investors who applied for at least 1.85 billion shares were offered 112 free shares for each 100 shares allocated. MTN group's operations in the continent have faced several challenges including the conflict in Sudan's capital Khartoum which started on April 15, 2023, between Sudanese Armed Forces and the Rapid Support Forces leading to the destruction of state-owned infrastructure in the city. The ongoing conflict in Khartoum has resulted in loss of revenue and earnings for MTN's subsidiary due to prolonged hyperinflationary environment leading to an impairment of R11. 72 billion ($618.66 million) relating to MTN Sudan's non-current assets.'Accordingly, the future economic benefits that can be derived from MTN Sudan's operations have declined,' the group says. Last year (2024) the group gained R1.3 billion ($68.61 million) from the sale of subsidiaries in Afghanistan and Guinea-Bissau and a loss of R1.9 billion ($100.27 million) on the sale of a subsidiary in Guinea-Conakry. The sale of MTN Guinea-Bissau and MTN Guinea-Conakry was concluded on August 1, 2024, and December 30, 2024, respectivelyThe group also disposed of 686 million shares in MTN Ghana to Ghanaian citizens as part of the Group's localisation strategy reducing the group's shareholding to 73.99 percent from 81.04 percent. © Copyright 2022 Nation Media Group. All Rights Reserved. Provided by SyndiGate Media Inc. ( James Anyanzwa
