Africa’s biggest mobile network MTN is expecting a decrease of between 10% and 15% in profits as fluctuating exchange rates hurt its bottom line.
In a market update to shareholders on Tuesday, the company said a drop of between 10% and 15% will hit its basic headline earnings per share (HEPS) when compared to the previous period ended June 30 2014.
This equates to its HEPS ranging between 656 cents and 620c, the company said.
Meanwhile, MTN is further expecting a 10% to 15% fall in attributable earnings per share (EPS) when compared to the previous period ended June 30 2014. MTN said its EPS is forecast to range between 658c and 621c.
“Adverse exchange rate (and cross rate) movements impacted both the rate at which revenues and EBITDA (earnings before interest, tax, depreciation and amortisation) were translated as well as resulting in increased forex losses when compared to the prior comparable period,” said MTN.
MTN’s announcement on lower-than-expected earnings also comes after a strike which affected its South African business and lasted for weeks ended earlier this month.
This month has also seen the departure of MTN South Africa chief executive officer Ahmad Farroukh, who has since been replaced by former local Microsoft executive Mteto Nyati.
MTN Group has over 210 million subscribers in Africa and the Middle East, making it one of the world’s largest telecommunications companies.