MTN paid ¢1.2bn taxes to government in half-year 2022

Leading mobile service provider, MTN Ghana paid ¢1.2 billion in direct and indirect taxes during the first-half of 2022.

According to its 2022 half-year Financial Statement, it registered a ¢1.33 billion profit in June 2022, a 54% growth over the same period in 2021.

However, earnings before interest, tax, depreciation and amortization (EBITDA) increased by 36.0% to ¢2.7 .billion.

Service revenue also increased by 28.9% year-on-year driven by growth in voice, data and Mobile Money (MoMo). This was supported by capital investments of ¢1.1 billion to boost service quality and expand capacity and coverage on our network as well as the diligent execution of commercial strategies resulting in an increase in subscriber base, an increase in usage and engagement by our customers.

During the period, the company rolled out 255 2G, 255 3G, 935 4G sites and modernized 776 sites which supported the increase in the 4G coverage by 21.5% year-on-year to 97.2%.

Voice revenue increased by 21.3% year-on-year to ¢1.6 billion. This was supported by an 11.6% year-on-year growth in its subscriber base.

The contribution of voice to service revenue as expected, however declined from 35.9% to 33.8% year-on-year.

MoMo revenue grew by 9%

During the period MoMo revenue grew by 9.0% year-on-year to ¢899 million, driven by slower growth in Person-to-Person revenue and overall transactional activity.

However, active MoMo users increased on a year-on-year basis (11%0) and advanced service offerings continued to show positive growth (24.0%).

“Advanced services remain a pivot for MoMo growth as we continue to expand the portfolio of products in that category. There are products in advanced piloting stage, and we expect these to be mainstream by the end of the year”, it said.

The contribution of Mobile Money to service revenue however decreased from 22.8% to 19.3% year-on-year.

At the end of half-year 2022, MTN recorded a 0.3% year-on-year decline in transaction value and a 19.3% year-on-year increase in transaction volume, noting that the E-Levy Phase 1 was implemented on May 1, 2022.

The company also recorded a 12.3% year-on-year growth in MoMo float.

“We continue to monitor consumer reaction to the levy and have implemented a 25% fee reduction to lessen the impact of the levy on customers along with campaigns to educate customers on the e-Levy and changes implemented. We remain engaged with the government and other stakeholders to ensure the long-term viability of the Mobile Money industry”, it stressed.

Digital revenue decline by 15.8%

Digital revenue declined by 15.8% year-on-year to ¢81.7 million, owing to the continued effort to rationalise the company’s digital products portfolio.

However, during the period, the number of active digital subscribers decreased by 0.3% year-on-year to 3.4 million.

“We will continue to enhance our digital messaging channels and add more value, choice and personalization to our music and gaming offerings.”

The contribution of digital to service revenue decreased from 2.7% to 1.8% year-on-year.

Outlook

MTN Ghana said it remained focused on the execution of its Ambition 2025 strategy to help withstand the pressures of the external environment on the business.

“We will continue to exercise prudent and disciplined cost management in a high inflationary environment through our Expense Efficiency Programme and maintain an efficient capital allocation to protect our margins and unlock value.”

“We expect to progress the localisation of Scancom PLC and Mobile Money Limited to completion in the second half of the year. We are committed to the national SIM registration exercise, and we will continue to invest the needed resources to achieve success by the end of the deadline, 30 September 2022”, it added.

It concluded that it remain committed to driving sustained growth and creating long-term value for stakeholders, maintaining medium-term target for service revenue growth of high teens (in percentage terms).