MTN says contract price hikes in South Africa will help ensure revenue growth, but warned load-shedding, inflation, and unemployment would likely continue to hurt its earnings until at least end-June.
MTN South Africa has recorded 6.9% lower first-quarter earnings before interest, tax, depreciation, and amortization in 2023 than in 2022.
SARB hiked interest rates by an additional 0.5 basis points in an effort to contain this, following 3 percentage points worth of hikes in 2022. Voice services, down 16%, were an overall drag on performance as people either called less due to economic constraints or substituted regular calls for data services.
The company said it lowered the overall cost to communicate for its customers, with the effective data tariff reduced by 8.7% year-on-year in the quarter. “An active postpaid data subscriber used approximately 13.8GB per month, an increase of 17.6%,” it added. “The overall result was supported by an increased uptake in data-oriented packages despite deteriorating consumer spending and credit conditions in the market,” MTN said.
The company warned that the remainder of the first of half of the year would continue to present headwinds to the MTN SA business, with macroeconomic and load-shedding impacts on service revenue progression and costs.
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