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MTC posts N$800m profit despite headwinds

2022-12-09  Paheja Siririka

MTC posts N$800m profit despite headwinds

Namibia’s first and largest mobile telecommunications service provider, MTC, yesterday stated that despite a difficult business environment and contraction of economic activity exacerbated by the global pandemic, its financial performance has been resiliently solid. 

This financial durability resulted in the company recording impressive revenue growth of N$2.9 billion for the financial year ending 30 September 2022. 

This revenue growth represents an increase of 3.7%, compared to the previous financial year, and translates into a 6.7% growth of its profit margin, which is equivalent to N$793 million (2021: N$743.2 million). 

At the release of the latest financials yesterday, MTC’s chief financial officer Thinus Smit said the inspiring performance is attributed to a 6.4% increase in prepaid average revenue per user (ARPU) charge in addition to continued expansion into the enterprise and home fibre markets.

“Increased investment in network expansion and optimisation accommodated growth in data traffic, smart partnerships and growth of 15.9% in outright handset sales are some of the main drivers of our financial performance,” Smit shared at yesterday’s release of the 2021/22 integrated financial report.

The CFO noted some of the challenges the listed company faced include a 10.2% reduction in postpaid ARPU as tough economic conditions impacted affordability. 

Additional challenges comprise of delays in deploying new products and services during the migration to a modernised business support system (BSS) intended to transform customer service as well as new market entrants competing for customers and specialist skills. 

To mitigate these challenges, the MTC team resorted to introducing more affordable postpaid packages and migrate customers to prepaid contracts. They also accelerated MTC’s digital transformation programme through cloud migration and the business support system to remain competitive and grow new revenue streams in enterprise and home fibre markets. The team also had to adjust their stock levels to mitigate global supply challenges.

“The journey of being the very first SOE/publicly listed company has been a very interesting one for us; on one hand, as a business, we were working tirelessly to remain market leaders in the space of innovation – and on the other hand, ensuring that our commitment to our acquired shareholders remains fulfilled,” said MTC CEO Licky Erastus.

With smart partnerships being one of the main drivers of financial performance, Erastus added the company is strategically continuing to explore this avenue to fulfill its innovation and sustainable value as pledged. 

“We continuously engage through our CSI (corporate social investment) initiatives that are imperative to redress imbalances of the past. The duty to transform the industry is as much the responsibility of public, private and state-owned sectors as it is the government’s duty to transform. We should all inherit the culture of working together and not in silos, as we possess a common goal,” Erastus noted.

During the 2022 financial year, MTC’s board declared an ordinary dividend of 32.28 cents per share, amounting to N$242.1 million, declared on 6 December 2021, paid on 4 February 2022. 

This is in addition to an interim dividend of 37 cents per share, amounting to N$277.5 million, declared on 30 May 2022, paid on 8 July 2022. 

Meanwhile, MTC board chairperson Theo Mberirua highlighted that the Ukrainian conflict aggravated fuel and food prices, which ultimately led to an adverse impact on the consumers’ wallets. “As a board, we are pleased with sound results that our team has achieved ever since and even more so than when we listed on the Namibian Stock Exchange. Our customers remain an integral part of our strategy – and this is why we continue to embed their views and perceptions into every performance aspect,” he said.

Mberirua added: “We have continued to invest in worthy social projects in the field of education, health, job creation and entrepreneurship.”


2022-12-09  Paheja Siririka

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