MTN reports 2% rise in FY profits

MTN Group, South Africa's second-largest cellphone company, has reported a two percent rise in full-year profit.

MTN said headline earnings for the year to end-December 2012 came in at 1,089.1c from 1,068.6c in the previous year.

Revenue rose nearly 11 percent to R135.1 billion and the telecoms giant increased subscribers by 15 percent to 189.3 million.

"The year was characterised by the continued global economic slowdown, increasingly competitive mobile markets as well as regulatory and political challenges," MTN said in a statement.

MTN is still Africa's largest cellphone operator by subscribers but it has recently been eclipsed in market value by Vodacom, a unit of Vodafone.

In 2012, the South African business pumped R6.4 billion into capital expenditure, with a focus on modernising the network and expanding 3G coverage and capacity. Last year it launched its fourth generation (4G) long-term evolution (LTE) network in Johannesburg, Pretoria and Durban.

Despite difficult conditions in its key Nigerian market, the group's profit margin, as measured according to earnings before interest, tax, depreciation and amortisation, rose strongly to 44.9 percent.

Foreign currency losses eroded profit from key markets such as Iran.

The MTN Group operates in 21 countries across Africa and the Middle East.

Image: © MTN Group

Copyright is owned by Africa Outlook and/or Outlook Publishing. All rights reserved.