Reporting its interim results for the period, the operator stated the subscriber growth was supported by competitive offerings and increased network capacity.
According to the operator, MTN SA felt the effects of weaker consumer demand and was slow to respond to aggressive price competition in both voice and data offerings. The total subscriber base declined marginally to 25 million, from 25.4 million at 31 December 2012.
“After a difficult start to 2013, which saw decreased subscriber net connections, the prepaid segment managed to regain some market share in the second quarter due to improved dormancy management and as customers responded positively to lower tariffs and increased promotional activity.”
The postpaid subscriber base performed well, says MTN, increasing by 5.8% during the six-month period to 4.8 million. “This was driven by competitive data offerings and the success of hybrid and classic packages.”
Total revenue in SA declined by 1.4%, to R20.1 billion, while airtime and subscription revenue declined by 4.4%, to R9.4 billion, largely due to lower outgoing voice revenue.
During the period under review, traffic volumes increased 26.2% year-on-year, and voice revenue grew 7.9%. MTN says voice revenue now accounts for 63.7% of total revenue, down from 64.8% in 2012. On a year-on-year basis, the average price per minute declined by 29.5% in US dollar terms.
“We remain focused on improving network quality and customer service, as well as providing value-added products and services to our customers, such as MTN Zone and Me2U,” says the operator.
During the six months under review, data services were the key driver of MTN’s revenue growth. “Our operations in SA and Nigeria were the biggest contributors to data revenue growth, while those in Ghana, Cameroon, Ivory Coast and Benin also delivered a strong performance.”
Data subscriber numbers increased by 29.5%, to 65.4 million, and data traffic grew by 55.7%. This, says MTN, was achieved through extending its 3G coverage, as well as through the increased number of data-enabled devices, which have reached 122.2 million. “Our network has 31.6 million smartphones in use and increasing smartphone penetration remains an important objective.”
Headline earnings per share increased 22%, to 654c.
Group EBITDA increased by 6.4% to R27.7 billion, with the EBITDA margin remaining stable at 42.5%, excluding the profit from the tower sales in Ivory Coast and Cameroon. “We expect improved organic growth in EBITDA in the second half of this year,” the company says in a statement.
The tower sales resulted in a R244 million year-on-year increase in lease costs, negatively impacting margins for the period.
The group’s capex increased 32.7%, with an investment of R12.7 billion in its network, bringing 2 130 2G and 1 800 3G sites on air. “This is in line with our strategy to improve the quality of our service offering to more customers and remains a key element in securing continued growth over the medium term,” says MTN.
The interim dividend per share increased 15.3%, to 370c, for the period.
Credit: IT Web