MTC remains resilient in tough year
Profit growth flat
Although MTC grew revenue and was profitable in its 2023 financial year, it did not achieve all strategic objectives due to the challenging operating environment, the group says.
Locally-listed Mobile Telecommunications Ltd (MTC) paid N$1.687 billion to suppliers in its 2023 financial year, of which about N$1.6 billion or 95% were pumped into Namibians businesses.The procurement spend at Namibian suppliers with black economic empowerment (BEE) credentials amounted to N$217 million.
According to MTC’s latest integrated annual report (IAR), released on Friday, the telecoms giant paid N$471 million in salaries and benefits in the year ended 30 September 2023. Direct tax paid to government and the Communications Regulatory Authority of Namibia (Cran) exceeded N$305 million.
The group invested N$504.1 million in network and systems infrastructure, and spent nearly N$2.1 million on rural electrification. It also invested N$240.8 million in radio and transmission network capacity expansion.
Results
MTC made a profit after tax of nearly N$794.2 million for the year ended 30 September 2023.
Compared to the telecoms group’s previous book-year, profit after tax rose by only N$1.1 million or 0.14%. This significantly lower than the 6.7% year-on-year (y/y) increase the company reported in its 2022 financial year.
Total income for the past financial year came in at nearly N$3.05 billion, up about 5% y/y.
Headline earnings per share (HEPS) – a profitability gauge – were 105.92c, a y/y increase of 0.1%.
MTC declared a final dividend of 38.80c per ordinary share, 7.6% lower than the 42c of its 2022 financial year.
In total, MTC paid N$663.3 million in dividends in 2023.
Challenging environment
Although MTC grew revenue and was profitable, it did not achieve all strategic objectives due to the challenging operating environment, the group said.
“Economic conditions for Namibian businesses and consumers worsened as the lingering effects of Covid-19 and the war in Ukraine weighed heavily on the country’s economy,” MTC chairperson Theo Mberirua said in the IAR.
High inflation and rising interest rates increased the costs of essential items, further eroding consumers’ disposable income and compounding the hardship experienced by the most vulnerable in society, he added.
“Impacted by cost inflation and intense competition, MTC maintained its empathy for customers by keeping prices constant and focusing instead on new value-adding products, services and solutions.
“Against this challenging backdrop, MTC continued to adapt its business to ever-changing technology, customer preferences and regulation. By adapting to change, we are positioning MTC to capitalise on new market opportunities and keep growing,” Mberirua said.
Market
MTC maintained its position as the leader of Namibia’s mobile telecom market, with an estimated market share of 84%, population coverage of 98% and a customer base of 2.17 million, the group’s managing director, Licky Erastus, said.
The group continued its aggressive expansion into the internet and broadband (fixed-line) market, achieving new revenue growth of 115%, he added.
MTC’s network grew to 1 014 active sites, 70% of which are 4G capable and account for 50% of mobile data traffic.
According to Erastus, the 081Every1 and rural LTE projects continue to give rural Namibians the same experience of mobile broadband as their urban counterparts.
During 2023, MTC upgraded 97 rural sites, 67 with refarmed spectrum to enable 4G/LTE technology.
* Scan the QR code to watch an interview with MTC managing director Licky Erastus.