MTN Nigeria Communications (MTNN) Plc, has reported a net loss of N137 billion due to net forex loss in 2023.
The company made this known in its audited results for the year ended December 31, 2023, released to the investing public on the Nigerian Exchange (NGX) Limited.
According to MTNN, the significant devaluation of the naira in 2023 resulted in a materially higher net forex loss of N740.4 billion, reflected within net finance costs, which resulted in a reported loss after tax of N137.0 billion compared to a restated profit after tax of N348.7 billion in 2022. This has resulted in negative retained earnings and shareholders’ equity at the end of December 2023 of N208.0 billion and N40.8 billion, respectively.
The company’s revenue stood at N2.469 trillion as against N2.012 trillion, representing 22.69 per cent year-on-year. Operating profit was up by 5.38 per cent to N773.660 billion from N734.164 billion in 2022, while finance income rose by 87.50 per cent to N25.815 billion as against N13.768 billion in 2022.
Finance cost amounted to N236.927 billion compared to N147.287 billion recorded in 2022. Total subscribers increased by 5.3 per cent to 79.7 million, active data users increased by 12.7 per cent to 44.6 million, while active mobile money (MoMo PSB) wallets increased by 163.2 per cent to 5.3 million.
Earnings before interest, tax, depreciation, and amortisation (EBITDA) grew by 12.3 per cent to N1.2 trillion while the EBITDA margin decreased by 4.5 percentage points (pp) to 48.7 per cent
Net loss for the year has resulted in a depletion of its retained earnings and shareholders’ fund to negative N208.0 billion and N40.8 billion, respectively.
MTNN stated that due to the substantial currency devaluation and its repercussions on retained earnings, the directors will not propose a final dividend payment, given the resultant loss for the year ended December 31, 2023.
Speaking on the results, CEO of MTN Nigeria, Karl Toriola said: “2023 witnessed a very challenging operating environment characterised by rising inflation, currency devaluation and foreign exchange shortages, complicated by geopolitical disruptions and cash shortages in Q1 arising from a redesign of the naira.”
He said, this development contributed meaningfully to the upward pressure on the cost of doing business in Nigeria, and for MTN Nigeria in particular, significantly increased the costs of our tower leases.
He added that “to mitigate the effects of these headwinds on our operations, we continued to invest in our network infrastructure, with a disciplined focus on value-based capital allocation and efficiencies to enhance capacity and expand coverage.
“This enabled us to meet the rising demand for data and, coupled with compelling and competitive propositions for our customers, accelerate the growth of our commercial operations.”
Toriola stated that “as we navigate the near-term headwinds to our business, we remain committed to delivering on our growth strategy through commercial execution and continued investment, guided by a disciplined focus on unlocking further efficiencies. We will drive the operating leverage in our business to restore growth in earnings and sustain strong cash flow generation and returns over the medium term.”
