MTN Uganda navigated changes in the regulatory environment in the first quarter to end-March and it remains on track to meet medium-term guidance, the CEO Sylvia Mulinge said Wednesday.
The business headwinds were cushioned by supportive macroeconomic conditions, a stronger shilling that appreciated 5.7% against the US dollar, and stable headline inflation which averaged 3.6%, only slightly higher than the 3.2% average in the first quarter of 2024, and marginally higher than the 3.1% of the fourth quarter of 2024.
Earnings before interest, tax, depreciation, and amortisation (EBITDA) increased by 13.7% year-on-year supported by a resilient revenue performance and moderate 12.2% cost growth. MTN contributed over 13% of MTN Group’s EBITDA in 2024. Profit after tax was up by 20.6% to Ush 180.9 billion.
“Despite the regulatory MTR (mobile termination rate) changes, we are pleased with the solid strategic execution that supported growth in other areas of our business, while ensuring margin resilience and value preservation in our operation,” Mulinge said.
A focus on customer centricity enabled the subscriber base to grow to 22.8 million in the quarter. Data and fintech subscribers increased by 19.4% and 9.8% respectively. Service revenue grew by 13.5%, with stronger contributions recorded from data and fintech portfolios.
In the connectivity business, an interim industry-wide directive from last year relating to the reduction in MTR from Ush 45 to Ush 26, impacted voice outgoing revenues in the quarter.
“To ensure resilience of our portfolio, we intensified our customer value management (CVM) and improved our bundle offering and service proposition to our customers,” said Mulinge.
On the data front, smartphone penetration was invested in by enhancing the affordability of devices through the Pay Mpola Mpola program and device purchase subsidies through partners. This helped to increase the number of smartphones in use by 9.8% on the network.
Data revenue accelerated by 32.5%, anchored by a 19.4% growth in active daily users to 10.2 million, indicating 1.7 million in net additions year-on-year.
Voice revenue was up 1.5%, after lower inbound voice revenue arising from the industry-wide MTR review. However, the reduced pricing resulted in a 16.5% uplift in voice traffic due to increased adoption of improved all-network bundles – this helped to cushion the impact of the MTR cuts.
Digital revenue grew by 23.5%, driven by growth in our content revenue and growth in video streaming subscriptions with increased adoption of the My MTN app.
Fintech revenue increased by 18.4%, driven by growth in mobile money services of 19%. This growth was anchored by growth in transaction volume of 19.9% to 1.2 billion.
MTN Group’s share price fell by 1.15% to R118.58 on Wednesday afternoon, but the price was still over 25% higher than a year previously.
BUSINESS REPORT
