MTN Uganda Limited HY2023 Interim Progress Report
SummaryMTN Uganda Limited delivered a resilient performance in the first half of 2023, despite a heightened inflationary environment and other macroeconomic pressures. Notably, there was positive growth in service revenue, voice revenue, data revenue, fintech revenue, and digital portfolio revenue. An expansion in EBITDA of 16.8% and EBITDA margin of 0.4pp to 50.6% was supported by expense efficiencies. The board approved a proposed dividend of Ush 5.6 per share, with MTN Uganda showing confidence for continued future growth.Voice PerformanceVoice revenue increased by 9.4% as a result of a growing customer base and improved engagement with customers through a revamped regional structure and customer value management. Customer NPS also improved with incremental improvements in network quality performance, product innovation, and brand appreciation. Voice contribution to service revenue decreased to 43.0% (H1 22: 45.5%).Data RevenueData revenue increased by 22.1%, driven by driving smartphone adoption, increased focus on enterprise business segment, and improved offerings for SMEs. Smartphone penetration increased to 35.7% (+3.7pp) with 24.1% growth in smartphone users, and MB per user grew by 25.0%. Home broadband revenue grew by 50.4%, with 65.0% growth in subscriber base. Data contribution to service revenue increased to 22.9% (H1 22: 21.7%).Fintech RevenueFintech revenue grew by 18.6% supported by a steadysubscriber base of 10.9 million customers (+11.6%). Advanced revenue contributions saw strong growth in payments and international remittances, and increased customer adoption of MoMoPay drove solid merchant growth to 267k (+223%) and a 26.3% increase in transaction volumes to 1.6 billion and transaction value growth by 44.4% to Ush 61.6 trillion. Fintech Contribution to service revenue increased to 28.7% (H1 22: 27.8%).Digital PortfolioMTN Uganda’s digital portfolio continued to perform well, with strong growth in music, gaming, and ayoba platform customers. Revenues grew by 155.7% to Ush 4.7 billion.Other Advantages and OutlookThe company received spectrum from the Uganda Communications Commission on the 2600Mhz, 2300Mhz, 700Mhz and e-Band to ramp up efforts on network performance and 5G operationalisation. Further, MTN Uganda launched ‘API as a Service’ and planned to relaunch the Webphone with Webex solution to drive digital transformation for customers. Expanding on ESG initiatives, the company contributed Ush 36 billion to the Uganda Communications Universal Service and Access Fund. According to the central bank, the current monetary policy stance and decreasing global inflation is expected to maintain inflation levels of 5% in Q3. MTN Uganda will pivot to seamless execution of Ambition 2025 plans including improved data speeds, e-sims, 5G connectivity,cashless conversion, and merchant propositions. Going forward, the company will maintain a low double digit service revenue growth with a focus on EBITDA stability and mid-teen capex intensity.
About MTN Uganda Limited (MTN.ug)
MTN Uganda is a leading mobile operator in Uganda. It was incorporated under the now repealed Companies Act (Cap. 110) as a private company limited by shares on 25 February 1998. The main object for which MTN was incorporated was to operate as a second national operator of a telecommunications network in Uganda. The original major shareholders of MTN were MTN International, Telia Overseas AB, Invesco and Tristar Investments SARL. MTN has a presence in all 134 districts of Uganda and has evolved from a telecommunications company providing value added services to a provider of an innovative range of products and services including voice, data, digital and mobile financial services delivered through a network of approximately 120,000 mobile money agents, 200 service stores and 14 main distributors. MTN Uganda Limited is listed on the Uganda Securities Exchange
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