MTN confident Cell C will recover and pay its bills

MTN CEO Rob Shuter said Cell C owed MTN SA R393 million, but he believed Cell C would get itself back into a stable situation and make its outstanding payments.

In its interim results for the period ended 30 June 2019, MTN said it had “not recognised revenue amounting to R393 million for network roaming services provided to Cell C”.

In simple terms, MTN told the market that Cell C is struggling to pay its bills for roaming on MTN’s network because of cash flow problems.

Speaking to Business Day TV, Shuter said: “We all know that Cell C has had some cash flow issues and they have fallen behind in some of the payments they owe to MTN.”

He is, however, positive about Cell C’s future and that these bills are therefore not bad debt which will have to be written off.

Cell C said it does not owe MTN money

While MTN hopes to receive payment from Cell C in future, there seems to be a difference of opinion regarding the outstanding bills.

Cell C’s chief financial officer, Zaf Mahomed said the company is up to date with all payments to MTN.

“Aspects of the current roaming agreement were recently renegotiated, and this has led to a reduction in roaming obligations,” he said.

“Cell C is not able to comment on the financial accounting of these obligations by MTN,” he added.

No regrets about the roaming agreement

Despite the alleged payment problems, Shuter said he does not regret signing up Cell C as a roaming partner.

“Cell C has been a roaming partner of ours since October last year. We have provided services all the way since then – it is only in the last few months that they had challenges,” Shuter said.

He added that MTN has generated good returns from the roaming partnership and that he is sure Cell C will get itself back on its feet.

“Cell C is a significantly larger roaming partner than Telkom, so it has still been a good deal for us,” Shuter said.

MTN CEO Rob Shuter interview

Now read: We have made all payments to MTN – Cell C

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MTN confident Cell C will recover and pay its bills