MTN declares 90c dividend vs 65c
A dividend of 90 cents per share was declared, up from 65 cents for the prior period.
The Group changed its financial year-end to 31 December, in line with its operational cycle and international peer group.
Revenue grew 49% to 52 billion rand compared with the previous unaudited 12 month period, driven mainly by the acquisition of Investcom and increased subscriber numbers. Excluding the 6 billion rand revenue impact from Investcom, the year-on-year growth in revenue would have been 32%, MTN noted.
Earnings before interest, tax, depreciation and amortisation (EBITDA) was 53% higher at 22 billion rand, while adjusted profit after tax increased to 12 billion rand compared with 7 billion rand for the nine months to December 2005.
The group said subscribers were up 73% in the period to 40 million on the back of both organic and acquisitive growth.
Subscribers in the South and East Africa (SEA) region increased by 27% to 16 million, the West and Central Africa (WECA) region by 80% to 20 million and Middle East and North Africa (MENA) recorded five million.
Excluding the impact of Investcom’s 8.4 million subscribers, the year-on- year growth was 36% with Nigeria and South Africa accounting for 17% and 10% respectively. Investcom subscribers have grown 38% in the six months since July 2006 reflecting the lower base and greater growth opportunities in these relatively under-penetrated markets, MTN said.
MTN said that although the group’s profile changed significantly through acquisitions concluded during the year, strong organic growth in the traditional markets underpinned the performance.
South Africa and Nigeria had revenue growth of 22% and 31% respectively in highly competitive markets compared to the prior 12 months.
MTN Nigeria launched an ultra-modern fibre-optic transmission network that will cover over 3,500 km when completed and span the length and breadth of the country. US$99 million has been invested in this project to date, MTN noted.
MTN added that acquisitions had a significant impact on its results, notably the Investcom transaction.
Investcom, which MTN acquired in July 2006 for $5.526 billion, contributed meaningfully to growth over the period since the acquisition and has been successfully integrated into the Group, it said. In addition, existing operations continued to perform well.
Investcom’s operations have expanded MTN’s footprint from 11 to 21 countries. Since acquisition, Investcom operations have generated 6 billion rand of revenue and 10 billion rand for the full year. Investcom generated 2.4 billion rand in EBITDA in the second half of the year and 4 billion rand for the full year.
MTN South Africa recorded a solid 22% growth in subscribers to 12.5 million following the introduction of new products and services and an increased focus on distribution. MTN South Africa maintained its market share for the year at 36%, the group said.
Looking ahead, MTN’s focus for 2007 includes driving regional synergies, taking advantage of opportunities within the value chain and improving operational efficiency through our least-cost operator strategy.
"In addition, we will continue to focus on rolling out our networks and pursuing strategic expansion opportunities to diversify earnings. The Group will also focus on implementing mobile money/payment solutions in our key markets to facilitate the transfer of funds in underserviced markets," it said.
Assuming the continuation of current market conditions, MTN expects to continue showing healthy subscriber growth and maintain its strong market position in key operations.
MTN Nigeria’s pioneer status ends on 1 April 2007 and 2007 will also be the first year in which profits will be taxed. This and the initial dilution impact of the Investcom acquisition will result in earnings consolidation in 2007, it added.
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