MTN Group Limited
Create your own report
MTN’s resilient business model positions us for accelerated growth and relevance in the run-up to 2025 and beyond. Here, we provide our views on our operating context over the short to medium term.
Elevated inflation
Forex volatility and availability
Regulatory
Geopolitics
Inflation continues to put upward pressure on operating costs, however our EEP, network investments and commercial strategies are helping to limit the negative impact on earnings. In the period ahead, adjustments to pricing for voice and data services will be necessary to offset rising network costs. Approval from regulatory authorities in multiple markets will be needed for these changes to take effect and enable us to deliver on our medium-term guidance.
Encouragingly, inflation started to trend lower in key markets such as South Africa, Ghana and Uganda.
Forex availability and paucity particularly in Nigeria, has had an adverse impact on the cost of capex.
MTN Nigeria is focused on margin recovery and improving its financial position following the recent devaluation of the naira. Engagements with regulatory authorities on much-needed tariff increases for the industry remain ongoing and a priority, and there is comprehensive work in progress to reduce and mitigate the foreign exchange exposures impacting tower operating costs particularly. A key priority for the year ahead will be to strengthen the MTN Nigeria margins and balance sheet resilience, including resolving for the longer term the negative equity position reported as at end of FY 2023.
In South Africa, we are monitoring the proposed amendments to the Electronic Communications Act in relation to spectrum, roaming, MVNOs, rapid deployment of infrastructure, facilities access and competition assessments. We are also monitoring developments regarding the next round of spectrum auctions. NIN-SIM registration regulations in the market in Nigeria and Ghana present ST headwind to subscriber base development, however will result in a more robust subscriber registration framework in the MT and LT.
The geopolitical environment continues to be relatively uncertain, both at a global level and in some of the regions we operate in. General elections in six of our key markets and globally present some uncertainty regarding the policy outlook and implementation. MTN Sudan continues to trade in a particularly challenging context, given the ongoing conflict in the country. The ongoing efforts in our localisation programmes - particularly Ghana and Uganda - is key to our agenda to create shared value in our markets as well as our broader asset realisation programme. In 2024, we will continue the work to meet our localisation targets in key markets.
Confirming our medium-term guidance
Service revenue growth
Holdco leverage
Asset realisation
Adjusted ROE
Group: at least mid-teens growth
South Africa: mid single-digit growth
Nigeria: at least 20% growth
Fintech: high – 20% to low – 30%
≤1.5x, faster non-rand deleveraging
>R25bn
Improvement towards 25%
While some short-term uncertainties remain, we see attractive medium and long-term prospects for our business, and we remain focused on the execution of our strategy to deliver on our medium-term targets. We provide outlook information throughout this report, particularly in: