Strong growth in Nigeria underpins solid MTN half-year results

MTN Group’s first-half earnings rose as Africa’s largest wireless carrier pushed ahead with an asset disposal plan and saw strong profit growth in its biggest market of Nigeria.

The Johannesburg-based mobile phone company said earnings before interest, taxes, depreciation and amortisation rose 10%, while sales also gained 10%.

MTN is now about six months into a plan to raise about R15-billion from disposals to help pay down debt, which increased to R70.1-billion rand in the first half. Even so, the carrier is seeking to add Ethiopia to its 21 markets, with a potential auction of new licences to take place by 2020.

MTN is among carriers suffering an interminable wait for the auction of new spectrum in South Africa. In the meantime, the carrier extended a roaming agreement with struggling rival Cell C on Wednesday to cut costs for both groups.A headache for for MTN is — as ever — its biggest market of Nigeria, where the company is still struggling to resolve a US$2.2-billion tax claim that’s delayed a plan to sell down a stake in its local unit. Africa’s most populous nation continues to pay its way, however, with earnings gaining 16% over the half year.

MTN shares have climbed almost 27% this year, narrowing the gap in market value to crosstown rival Vodacom Group to just R6-billion.

Source: Bloomberg LP (Via Tech Central)