Johannesburg, South Africa - MTN Group
reported strong financial, operational and sustainability results in 2021 in a
tough macro environment. These were delivered through strong strategic
execution and sustained commercial momentum across 19 markets, in the year in
which Africa’s leading mobile operator started implementing its refreshed
Ambition 2025 strategy.
“We
adapted to the extraordinary circumstances brought about by the COVID-19
pandemic and started shaping the MTN of the future through the execution of
Ambition 2025,” said MTN Group
President and CEO Ralph Mupita.
In constant-currency terms, service revenue grew by
18.3% to R171.8 billion; earnings before interest, tax, depreciation and
amortisation (EBITDA) increased by 23.7% to R80.8 billion; and the EBITDA
margin expanded by 2.2 percentage points to 44.5%. The Board declared a
final dividend of 300 cents per share.
“The
performance was underpinned by pleasing growth in our larger operating
companies, operating leverage and the benefits of our expense efficiency
programme,” said Mupita, adding that headline
earnings per share adjusted for non-operational items increased by 26.6%;
return on equity expanded by 2.6 percentage points to 19.6%; and organic
operating cashflow accelerated by 35.2% to R38.3 billion.
The results were delivered despite a slowdown in
subscriber additions related to industry-wide regulations in Nigeria. At
year-end, MTN Group had a total of 272.4 million subscribers, up
2.9 million from end-2020. Greater adoption of data and fintech services
resulted in the addition of 11.1 million new data users and 10.4 million
new Mobile Money users to reach totals of 122.0 million and
56.8 million respectively. To cater for the 53.3% expansion in data
traffic and 41.1% increase in fintech volumes, we continued to invest in the
capacity and resilience of our networks and platforms, deploying total capex of
R32.7 billion in the year.
We increased our financial flexibility to capture the
opportunities identified by Ambition 2025. We deleveraged the balance sheet,
paying US$1.4 billion in dollar debt and improving the holding company
leverage to 1.0x from 2.2x. This was boosted by cash of R18.4 billion
repatriated from our operating companies and R4.1 billion in proceeds from
our asset realisation programme (ARP) during the 2021 financial year. We
anticipate further net proceeds of R8.8 billion from the public offer of
MTN Nigeria shares and the sale of passive tower infrastructure, once
completed.
Among other highlights of the ARP – which aims to reduce
debt, simplify our portfolio, reduce risk and improve returns – were the New
York Stock Exchange listing of IHS Towers, in which we have a 26% stake; the
localisations of a number of our operating companies; and our exit from
operations in Yemen and Syria.
We progressed work to build the largest and most
valuable platforms, reporting strong growth in our fintech business. It now has
57 million monthly active users and generates 10 billion transactions with
total transaction value of US$239 billion within the 2021 calendar.
With a step change in our approach to sustainability, we
created more shared value. We connected 23 million more people to
broadband and achieved rural broadband coverage of 83% against our target of
95% by 2025. We reduced the cost to communicate by a 15.3% average reduction in
the costs of a GB of data across our markets. Our economic value added to
nation states where we operate increased to R115 billion, with cash taxes
paid up at R11 billion across our markets. We linked long-term incentives for
executives to various ESG indicators, with a focus on reaching net zero
emissions by 2040; progressing diversity and inclusion; and extending rural
broadband.
With growth structurally sustaining at higher levels, we
enhanced our medium-term guidance, raising our targets for Group service
revenue growth and returns. The Board also adopted a revised dividend policy to
provide guidance on an annual basis in March indicating the minimum ordinary
dividend expected in the financial year ahead, aligned to the group capital allocation
framework.
“We
remain focused on providing leading digital solutions for Africa’s progress and
creating shared value for our stakeholders. Our enhanced medium-term guidance
reflects the growth we see across our markets, as we play our part in driving
digital and financial inclusion across Africa,” concluded Mupita.
Source: MTN Group
