MTN adds 20% more subscribers

Johannesburg, 29 Aug 2007

Mobile operator MTN reported this morning that its subscriber base grew by 20%, to 48 million, for the six months ended 30 June.

Group revenue for the period increased by 69%, to R34.2 billion, compared to the six-month period to June 2006.

Investcom contributed 21% to the group's revenue and accounted for 35% of the revenue growth for the comparable period.

EBITDA went up 75%, to R15.2 billion from the June 2006 period, while the EBITDA margin increased to 44.4%. The adjusted headline earnings per share was 324.7c.

Profit after tax increased 16.8%, to R6.3 billion, compared to R5.4 billion for the six months to June 2006.

MTN said on its Web site that, excluding the positive effect of foreign currencies strengthening against the rand, group revenue growth would have been 60% and group EBITDA growth would have been 64%.

Nigeria and SA were the company's key contributors, recording increases of 51% and 15% in revenue respectively for the six-month period under review. Nigeria's growth in local currency was 33%, and the strengthening of the naira against the rand contributed 18%. Nigeria reported high revenue growth due to increased subscriber numbers and newly-introduced "competitive offers" in the last quarter of 2006.

ARPU decrease

In SA, the company's subscriber base grew by 7%, to 13.4 million subscribers, with the same percentage growth in the prepaid market. This brings the total number of customers in this segment to 11 million. The postpaid subscriber base grew by 3%, to 2.4 million subscribers.

Average revenue per user (ARPU) in the postpaid segment decreased to R435 from R487 in December 2006. Prepaid ARPU decreased to R87 from R94. Both decreases were attributed to continued penetration into lower-usage segments. As expected, blended ARPU decreased 9% to R149 from R164 in December 2006.

The MTN data proposition is gaining momentum, with a 58% increase in data revenue to R1.2 billion. The company says this is due to competitive pricing and an increased 3G roll-out.

In March, MTN said it wants to grow its subscriber base by 41% for the year. In September 2006, MTN had a total of 35 million subscribers, up from 20 million in 2005.

The cellular operator plans to add 16.5 million subscribers through acquiring 3.5 million customers in Nigeria, 900 000 in Ghana, 5.5 million in Iran, 850 000 in Sudan, and two million in SA. The rest of its operations are expected to add 3.8 million subscribers.