MTC revenue increases despite market conditions

Mobile operator MTC says it has seen a moderate increase in its revenue, despite challenging macroeconomic and geopolitical conditions.

This follows the release of its interim financial results for the interim period ended 31 March. For the period under review, revenue increased by 5.91% to N$1.57 billion, due to the demand for high speed and value-added managed services which contributed to the market expansion of mobile and enterprise revenue, the company said.

For the period under review, MTC reported an unaudited profit after tax of N$362 million, while headline earnings per share was 48 cents.

Earnings before interest, tax, depreciation and amortisation (EBITDA) decreased by 4.9% to N$700 million from N$734 million in the same period last year, due to increases in direct and operating costs.

Despite the moderate growth in revenue, the operator conceded that a legal matter regarding its regulator and ongoing efforts to register its members had led to financial outflows.

MTC found itself having to cough up an additional N$59.7 million in levies owed to its watchdog, the Communications Regulatory Authority of Namibia (CRAN), following the outcome of a Supreme Court ruling earlier this year.

“Following a Supreme Court ruling on Section 23 of the Communications Amendment Act on 13 March, MTC was found liable for levies to CRAN for the 2021, 2022, and 2023 financial years. This resulted in an additional N$59.7 million raised for arrear levies and a N$75.4 million increase in regulatory levies compared to the same period last year,” the telecommunications giant said.

Sim registration

MTC’s coffers were further impacted by the sim registration project which required the recruitment of staff members to assist the operator comply with the ministry of information’s directive that its customers enrol for mandatory sim registration.

“The sim registration project increased temporary personnel cost, overtime and travel related costs because of the sim registration deadlines in December 2023 and March 2024. Total income growth stands at a high 5.89%, partially offsetting the CRAN licence fees,” MTC said.

Despite the cost pressures, MTC said it remained committed to controlling its expenditure amid foreign currency exchange pressures, the cost of implementing new technologies and increased depreciation and amortisation costs.

“MTC continues to remain committed to control cost despite high inflation, adverse foreign currency fluctuations and the cost of implementing new technologies while driving business growth. Net profit before tax was further impacted by increased depreciation and amortisation as a result of high capital investments in new technology and infrastructure maintenance. Interest earning increased due to higher market return on our investments,” it said.

Looking ahead, MTC said it was focused on growing its fibre network, together with the launch of a new service offering.

“MTC is enhancing its network infrastructure by extending fibre connections across key regions. This strategic development improves service delivery and aligns with the growth potential presented by upcoming energy projects in Namibia,” the company said.

“MTC is preparing to enhance its offerings with the upcoming launch of a new mobile financial service. This initiative is designed to broaden our service portfolio, catering to the evolving needs of our customers,” it added.

The MTC board declared an interim dividend of N$253 650 000, being N$33.82 per ordinary share, on 31 May, the company noted.