MTN Nigeria, the telecommunications giant, reported a significant loss for the full year 2023, marking its first annual deficit in three years.
The company disclosed a loss after tax amounting to ₦137.0 billion in 2023, a stark contrast to the profits of ₦348.7 billion recorded in the previous year.
The financial downturn is attributed to the depreciation of the Naira and escalating operational expenses, particularly in tower lease costs.
Naira Devaluation and Tower Lease Costs Hit MTN Nigeria: Full-Year Report Unveils Fiscal Setback
According to the full-year 2023 report released by MTN Nigeria, the payment of tower lease costs, indexed to the US dollar but invoiced and paid in Naira, accounted for a significant portion of the company’s foreign currency exposure in operating expenses.
Karl Toriola, the CEO of MTN Nigeria, highlighted the impact of the more liberal foreign exchange management system adopted by the Central Bank of Nigeria (CBN) in June 2023, which substantially increased the cost of doing business, particularly in relation to tower leases.
Key Insights from MTN Nigeria’s Full-Year 2023 Report: Subscriber Growth and Financial Challenges
Despite the financial setbacks, MTN Nigeria reported several key takeaways from its full-year 2023 performance.
The company maintained a substantial subscriber base, with 79.7 million mobile subscribers.
Additionally, active mobile money (MoMo PSB) wallets witnessed an impressive surge, increasing by 163% to reach 5.3 million.
Furthermore, the company experienced growth in its FinTech revenue, which grew by 2.4%.
Navigating Challenges: MTN Nigeria’s Response to High Inflation and Currency Crisis
Operating in a high inflationary environment compounded by a currency crisis and rising energy costs, MTN Nigeria faces significant challenges.
Nevertheless, the company remains resilient and committed to expanding its non-core services, including Cloud, Unified Communications, and IoT applications, to capitalize on future opportunities.
This strategic approach is complemented by the continued expansion of its 4G and 5G businesses.
Engaging Regulators and Resolving Disputes: MTN Nigeria’s Proactive Measures
In response to ongoing challenges, MTN Nigeria is actively engaging regulators to resolve disputes, particularly the USSD dispute with banks.
By fostering constructive dialogue and seeking amicable resolutions, the company aims to mitigate operational hurdles and strengthen its market position.
Financial Performance Highlights: MTN Nigeria Reports Revenue Growth Despite Loss
Despite the fiscal setback, MTN Nigeria reported notable revenue growth in key areas. Services revenue surged by 22.4%, primarily driven by a remarkable 39.8% growth in data revenue.
Voice revenue also witnessed a significant uptick, rising by 9.7%. Moreover, the company’s mobile subscribers increased by 5.3% to 79.7 million, bolstered by enhanced gross connections and churn management initiatives.
Expansion in Mobile Money Services: MTN Nigeria’s Efforts to Boost Adoption
MTN Nigeria’s mobile money services experienced a substantial increase in adoption, with active MoMo PSB wallets soaring by 163% to 5.3 million.
Powered by a growing network of MoMo agents and merchants, the company is actively addressing adoption challenges and deepening its partnerships, such as the recent collaboration with Mastercard to bolster its mobile money ecosystem.
Digital Revenue Surge: MTN Nigeria Records Significant Growth in Digital and FinTech Revenue
In a notable development, MTN Nigeria’s digital revenue arm witnessed a remarkable 69.9% increase, reaching ₦37 billion.
Furthermore, the company’s FinTech revenue grew by 2.4%, reflecting its commitment to innovation and diversification amidst challenging market conditions.
Despite facing headwinds, MTN Nigeria remains focused on driving growth and delivering value to its stakeholders.