MTN Nigeria Communications Plc has announced its unaudited results for the quarter ended 31 March 2021.

The telecom company in a released unaudited result, reveals that its mobile subscribers declined by 5 million to 71.5 million due to the effects of customer churn and the regulatory restrictions on new SIM sales and activations.

The telelecom company’s active data users also declined marginally by 71,000 to 32.5 million.

However, its service revenue increased by 17.2 per cent to N385.2 billion, while

Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) grew by 19.1 per cent to N204.5 billion.

EBITDA margin increased by 0.9 percentage points to 53.1 per cent. Capital expenditure was up by 19.3 per cent to N89.9 billion, up 27.8 per cent to N31.6 billion excluding right of use (RoU) assets.

The result showed that profit before tax grew by 33.9 per cebt to N102.9 billion, while earnings per share rose by 42.5 per cent to N3.60 kobo.

According to the report, “Operationally, service revenue in Q1 grew by 17.2 per cent year on year (YoY), in line with our medium-term target, supported by growth of 42.6per cent and 8.0 per cent in data and voice revenue respectively.

“This was achieved despite the impact of the pandemic and a decline in our subscriber base due to the effects of customer churn and the restrictions on new SIM sales and activations arising from changes in SIM registration regulations. We continue to collaborate with the Nigerian Communications Commission (NCC) and the Nigerian Identity Management Commission (NIMC) to update subscriber records with the National Identity Number (NIN).”

Commenting on the report, MTN Nigeria CEO, Karl Toriola, said: “We made good progress in the first quarter of 2021 despite the continued impact of the COVID-19 pandemic. We continue to prioritise the safeguards put in place to protect the health and well-being of our people, customers and stakeholders and to control the spread of the virus while ensuring network resilience and efficiency.

“As part of our Y’ello Hope initiatives, we continue to support Government’s efforts in combatting the COVID-19 pandemic. We supported the most vulnerable in our communities, providing them with free-to-access services (including SMS and data) as well as essential medical supplies (tests and personal protective equipment).

“We continue to support the Coalition Against COVID-19 (CACOVID) that has driven multiple initiatives, such as building isolation centres across the country. MTN Nigeria also paid taxes early in support of Government’s ongoing efforts. In addition, our REVV support programme for Micro, Small and Medium Enterprises (MSME) helps them navigate the new digital reality.”

Toriola said MTN Nigeria would continue to actively support the federal government’s NIN enrolment programme, with 182 points of enrolment active across the country, noting, “We are working with NIMC to increase the enrolment centres to provide an access point for as many Nigerian as possible.”

The report further stated that digital revenue grew by 101.0 per cent and fintech revenue by 28.5 per cent as customers continued to adopt more digital products and services, a trend accelerated by the pandemic.

“As at the end of March 2021, we had 449,100 registered MoMo agents and 4.6 million fintech customers.

Our ability to drive service revenue growth while managing the growth in expenses resulted in an acceleration in EBITDA growth to 19.1% and EBITDA margin expansion of 0.9pp to 53.1% YoY. This enabled profit before tax (PBT) and profit after tax (PAT) growth of 33.9% and 42.5% respectively,” the report said.

The report further explained that enterprise business continued its recovery from the impacts of the COVID-19 lockdown as economic activity improved.

It said expenses rose by 14.8 per cent, mainly driven by a 19.2 per cent increase in operating expenses arising from an accelerated site rollout and the effects of Naira depreciation on lease rental costs.

“The overall increase in expenses was partly mitigated by the comparatively moderate growth of 7.8 per cent in cost of sales following the suspension of new SIM sales and activations. As a result, EBITDA rose by 19.1 per cent, supported by revenue growth, with the EBITDA margin expanding by 0.9pp to 53.1 per cent,” the report stated.

Giving insights of general business outlook, Toriola said:” Our 2021 priorities remain unchanged, with a clear focus on sustaining double-digit revenue growth, driving 4G network expansion and positioning our fintech business for accelerated growth in order to unlock its full value. The acquisition of additional 800MHz spectrum, positions us to deliver improved service speeds to Nigerians in support of the government’s broadband initiative.”

He said MTN would continue to sustain its expense efficiency programme to strengthen its financial position and support margins.

“We will pursue stronger and deeper stakeholder relationship and enhanced shared value across our stakeholder ecosystem while ensuring that our activities align with the Government’s development agenda. Environmental, social and governance (ESG) principles remain at the core of everything we do, with a focus on aligning our priorities to drive eco-responsibility, sustainable society, sound governance and economic value for all in Nigeria,” Toriola added.