Lagos, Nigeria – February 28, 2025 – MTN Nigeria Communications Plc has reported a N400.4 billion loss after tax for its full-year 2024 financial results, marking a 192.24% increase in losses compared to the previous year’s N137.0 billion loss. The company’s performance was significantly impacted by rising operating costs, forex losses, and increased finance expenses.
Thank you for reading this post, don't forget to subscribe!Revenue Growth Offset by Cost Pressures
Despite the loss, MTN Nigeria’s total revenue grew 36.13% year-on-year to N3.36 trillion, driven by a strong performance in key segments:
• Data revenue surged 48.74% to N1.59 trillion, reflecting increased demand for mobile internet services.
• Voice revenue rose 15.37% to N1.1 trillion, while SMS revenue saw a significant 80.3% jump to N178.8 billion.
• Fintech (value-added services) expanded by 26.94%, reaching N105.0 billion.
• Other revenue grew 146.85%, contributing N185.3 billion.
However, operating expenses surged 29.85%, reaching N1.35 trillion, with major cost drivers including:
• Network maintenance expenses more than doubling to N168.5 billion (+101.13%).
• Direct network operating costs rising 88.05% to N1.23 trillion.
• Interconnect, transmission, and roaming costs increasing 30.53% to N234.3 billion.
• Depreciation and amortization expenses jumping 24.78% to N535.2 billion.
Forex Losses and High Finance Costs Weigh on Profitability
MTN Nigeria’s net foreign exchange loss rose 24.98% to N925.4 billion, largely due to currency devaluation. Finance costs also spiked 82.19% to N431.6 billion, further straining the company’s bottom line. Consequently, net finance costs grew 39.62% to N1.33 trillion, pushing the company into deeper losses.
Weak Profit Margins and Negative Shareholders’ Equity
The company’s profitability ratios showed significant declines:
• EBITDA margin dropped from 48.7% in 2023 to 39.1% in 2024.
• Net profit margin fell from -5.5% to -11.9%, reflecting the impact of rising costs.
• Debt-to-equity ratio remained negative at -212.4%, although it improved from -2951.3% in 2023.
• Return on equity (ROE) stood at 87.4%, while return on assets (ROA) was -11.9%.
Balance Sheet: Rising Liabilities and Declining Cash Reserves
MTN Nigeria’s total assets increased 31.62% to N4.2 trillion, driven by a 188.74% surge in right-of-use assets to N1.38 trillion. However, total liabilities jumped 44.13% to N4.65 trillion, resulting in a negative shareholders’ equity of N458.0 billion. The company’s cash and cash equivalents dropped 51.24% to N364.2 billion, indicating liquidity challenges.
Market Performance and Outlook
MTN Nigeria’s share price closed at N200.0 in 2024, with a 52-week high of N267.8 and a low of N169.0. The company’s price-to-earnings ratio stood at 31.60x, while earnings yield was negative at -9.53%.
Corporate Actions
MTN Nigeria did not declare an interim dividend or bonus issue, with key corporate action dates yet to be announced.
Economic Environment Impacting Performance
The company’s financial results were influenced by Nigeria’s rising monetary policy rate (MPR) of 27.5%, high inflation of 24.48% (January 2025), and real GDP growth of 3.86% in Q4 2024.
MTN Nigeria’s management remains focused on mitigating cost pressures and improving operational efficiencies as it navigates a challenging macroeconomic landscape.
Source: Company Financials, Cowry Research
