Business
See how MTN profits from Covid-19 Pandemic in Nigeria
MTN Nigeria, appears to be making a fortune out of the Covid-9 misfortune of the country as it recently recorded a staggering N329.1 billion rise in revenue in the first quarter of 2020, just when businesses across the world and particularly in Nigeria are struggling. In comparison to the N282.1 billion it made in the same quarter last year (Q1 2019) the telecom giant made a 16.7% increase.
With a N51.1 billion profit for the period in comparison to Q1 2019 of N48.4 billion, it disclosed profits 5.9% higher than last year – even with increased finance costs of 25.3% percent revealing the capital-raising measures taken by the group to stimulate its operations.
It was also in line with this that the company recorded a jump of 103.5% in interest expense on borrowings from N7.9 billion in Q1 2019 to N16.1 billion in Q1 2020. Total value also recorded a jump as there was a 35.3% growth in the group’s net asset from Q1 2019’s N145 billion to Q1 2020’s N196 billion.
Its revenue figure is defined by a jump in voice calls of 6.14% from the N182.8 billion earned in Q1 2019, to its Q1 2020 N194 billion turnovers. However, it is nothing compared to the 58.84% increase in revenue derived from local data usage (excluding roaming data) in the quarter from Q1 2019.
Value-added service and digital services also witnessed a jump of 33.93% and 12.11% respectively. Having settled the $2 billion claim for back taxes it was plagued with last year that swayed investor confidence, it certainly came back strong this year.
MTN has had a nice ride since its listing about a year ago. The first wave was observed within 48 hours of its being listed on the NSE for the first time in May 2019 when it was immediately ranked amongst the NSE top 5. It also didn’t take a couple of months before it shook the market by becoming the first on the NSE, temporarily surpassing Dangote Cement.
MTNN’s share price has had a turbulent 2020. The stock is up 6.6% YTD and fell to a year low of N90 in March. At a price-earnings ratio of 11.3x investors are bullish about its ability to continue to deliver impressive growth.
According to the NCC, MTN contributed about 10.60% to the country’s GDP with a total of 185.7 million subscribers. The telecom giant holds the largest market share of active telephone subscribers – 38% of GSM subscribers and 43% of internet subscribers.
