MTN 201510220017A
Quarterly update for the period ended 30 September 2015
MTN Group Limited
(Incorporated in the Republic of South Africa)
Registration number: 1994/009584/06
ISIN: ZAE000042164
Share code: MTN
(“MTN” or “the Group”)
Quarterly update for the period ended 30 September 2015
MTN is a leading emerging market mobile operator, connecting approximately 233 million people in 22 countries across
Africa and the Middle East. MTN is at the forefront of global technological changes, delivering a bold, new Digital
World to our customers.
Highlights
Subscriber growth of 0,9% quarter-on-quarter (QoQ)
Subscriber growth in South Africa increased 2,0% QoQ driven by pre-paid segment
5,1 million disconnections in Nigeria relating to the subscriber registration process resulted in muted net additions
in the quarter
Registered Mobile Money subscribers of 36,5 million, up 12,7% QoQ across 14 operations
Constant currency data revenue increased by 27,0% year-on-year (YoY), now contributing 23,2% to total revenue
Voice and data traffic increased 18,7% and 120% respectively (YoY)
YoY refers to: nine months to September 2015 versus nine months to September 2014.
QoQ refers to: Q3 2015 versus Q2 2015.
MTN Group president and CEO, Sifiso Dabengwa comments:
"The Group’s third quarter results reflect continued progress made in the South African operation strengthening its
market position and significant improvements in network quality following corrective measures taken in MTN Nigeria.
The Group continued to invest in its 3G network catering for increased demand for data services. During the quarter
we added 3 800 3G sites and 1 357 LTE sites. This together with increased 3G device penetration resulted in more than
100% YoY increase in data traffic across our operations. Mobile Money and digital content revenues continued to gain
healthy traction, steadily increasing their contribution to revenue.
However, aggressive price competition, weakening macroeconomic conditions in most of our markets and unfavourable
exchange rate movements continued to impact financial performance for the quarter.”
Operational review
MTN South Africa continued to gain momentum, increasing its subscriber base by 2,0% to 29,1 million for the quarter.
This was mainly as a result of a 3,1% increase in the pre-paid subscriber base, supported by the continued success of
attractive below-the-line campaigns. Billable minutes of use increased 41,4% YoY.
The post-paid subscriber base recorded a 2,6% decline to 5,2 million due to the disconnections of approximately 90 000
low-cost router SIMs recorded on the Autopage subscriber base and low availability of handsets. While supply chain
issues have been largely resolved, the operation continued to experience limited availability of handsets during the
quarter as a result of delayed deliveries.
Data revenue increased 40,0% and now contributes 31,5% to total revenue. This was driven by attractive segmented data
bundles and an increased uptake of digital services. The rollout of the 3G and LTE networks continued to make good
progress with 1 746 largely co-located 3G and 811 LTE sites added during the quarter. ARPU increased 8,8% for the
quarter.
MTN Nigeria recorded a marginal decline in its subscriber base to 62,5 million subscribers. This was mainly as a
result of the disconnection of 5,1 million subscribers at the end of August 2015 in line with industry-wide regulatory
registration requirements. To date, 3,4 million of these subscribers have been reconnected. While management continues
to engage with the regulator, performance continues to be impacted by ongoing regulatory restrictions. Billable minutes
of use increased 12,8% YoY.
The operation has put corrective measures in place to address the operational challenges experienced in the first half
of the year and has seen significant improvement in network quality together with more competitive offerings. A chief
operations officer role has been established in the operation to reinforce the management team. Jyoti Desai, Group chief
technology and information officer, has temporarily been appointed to this role and Raul Medina has been appointed as
chief marketing officer.
Data revenue increased 16,8% and now contributes 21,3% to total revenue. Data revenue growth was impacted by a steep
decline in data tariffs as a result of aggressive competition. The effective data tariff declined almost 60% YoY.
Improving data speeds through aggressive 3G rollout in main cities remains a priority and is on track. During the
quarter 630 3G and 66 LTE sites were rolled out. Digital revenue continues to gain traction, now contributing 10,2%
to total revenue.
Diamond Yellow, the mobile money offering, continues to make good progress with a key focus on expanding the
distribution footprint. Local currency ARPU declined 5,0%.
MTN Irancell delivered a strong performance in a competitive market increasing its subscriber base by 3,0% to 45,5
million with an incremental increase in market share. This was attributable to segmented on-net bonus promotions and
attractive data bundles. Billable minutes of use increased by 9,0% YoY. Constant currency data revenue increased by
89,9% YoY largely attributable to the 28,5% YoY increase in data users as well as the 386,2% YoY increase in data
traffic. Data revenue now contributes 28,5% to total revenue. The operation remains focused on driving data services
and has rolled out 1 012 3G sites and 498 LTE sites for the quarter. Local currency ARPU increased by 0,9% supported
by higher minutes of use.
MTN Ghana delivered a sound performance increasing its subscriber base by 4,1% surpassing 15 million at the end of the
quarter. This was driven by superior network quality and attractive acquisition promotions and bundled offers. Billable
minutes on the network increased 38,4% YoY. Constant currency data revenue increased 78,6% and now contributes 28,7% to
total revenue supported by a high-quality 3G network and strong growth in Mobile Money and digital services.
Mobile Money recorded 5,3 million subscribers, growing revenue 199% YoY and now contributes 5,2% to total revenue,
while digital services revenue grew 89,0% and now contributes 7,2% to total revenue.
MTN Cameroon decreased its subscriber base by 4,0% to 9,9 million impacted by the disconnection of low-cost routing
subscribers and a revised subscriber registration process. The operation continues to experience aggressive price
competition which resulted in the effective rate per minute declining 15,5% YoY. Billable minutes of use increased
4,6% YoY. Constant currency data revenue increased by 58,7% and now contributes 13,7% to total revenue. This was
supported by attractive data value propositions and data bundles.
Mobile Money subscribers increased by 8,0% to 1,9 million. The operation continues to focus on the expansion of its
3G network and rolled out 34 2G and 27 3G sites during the quarter. Local currency ARPU improved by 6,2% supported by
below-the-line offers.
MTN Ivory Coast recorded a marginal decline in its subscriber base to 8,5 million following the clean up of the
subscriber base. The billable minutes of use declined 5,5% YoY as the business faced increased competitive pressures
from competition. Constant currency data revenue increased by 58,6% YoY and now contributes 15,2% to total revenue.
Mobile Money subscribers increased by 1,9% to 2,8 million. The operation continues to focus on expanding its 3G and
LTE network to cater for the increasing demand for data services. During the quarter, 30 2G and 89 3G sites were
rolled out. Local currency ARPU declined by 3,2%.
MTN Uganda increased its subscriber base by 3,4% to 11,5 million, attributable to increased take up of MTN Zone and
attractive voice bundles. Billable minutes of use increased 19,1%. Constant currency data revenue increased by
14,8% YoY supported by improved data bundles and now contributes 26,8% to total revenue.
Mobile Money continued to show solid growth, recording a 9,6% increase in registered subscribers to 9,0 million. Local
currency ARPU increased 5,1% largely attributable to increased minutes of use following a reduction in the effective
tariff.
MTN Sudan reported a net reduction of 442 000 subscribers for the quarter to 8,3 million subscribers largely impacted
by subscriber registration requirements. Constant currency data revenue increased by 78,9% YoY, driven by an increased
uptake in digital content and now contributes 18,3% to total revenue. There is a continued focus on 3G network rollout
and improved network quality. Local currency ARPU increased by 2,8%.
MTN Syria improved its subscriber base marginally to 5,7 million. The operation continues to operate in extremely
challenging conditions. Despite this, constant currency data revenue increased 25,0% YoY and now contributes 27,4%
of total revenue. Local currency ARPU increased by 8,6%.
Net additions guidance ’000
June 2014 September 2015
South Africa 1 800 1 600
Nigeria 5 000 4 500
Iran 1 600 2 000
Large opco cluster 4 850 3 850
Ghana 1 500 1 700
Cameroon 1 150 750
Ivory Coast 800 750
Sudan 0 (500)
Syria 0 (150)
Uganda 1 400 1 300
Small opco cluster 3 380 2 750
Other joint ventures 120 100
Total 16 750 14 800
Subscribers
(‘000)
Country 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 QoQ %
South Africa 24 875 25 269 26 701 27 993 27 958 28 504 29 077 2,0
Post-paid 5 192 5 458 5 477 5 419 5 402 5 328 5 190 (2,6)
Pre-paid 19 683 19 811 21 224 22 574 22 555 23 176 23 888 3,1
Nigeria 57 224 58 446 58 363 59 893 61 149 62 813 62 494 (0,5)
Large opco cluster 53 757 55 822 56 824 56 735 57 734 59 407 59 511 0,2
Ghana 13 055 13 439 13 547 13 852 14 208 14 886 15 493 4,1
Cameroon 9 236 10 233 11 223 9 658 10 097 10 363 9 949 (4,0)
Ivory Coast 7 521 7 742 7 723 8 016 8 295 8 488 8 461 (0,3)
Uganda 9 549 9 920 10 181 10 396 10 791 11 146 11 524 3,4
Syria 5 723 5 653 5 676 5 861 5 747 5 765 5 769 0,1
Sudan 8 672 8 836 8 474 8 951 8 595 8 757 8 315 (5,0)
Small opco cluster 29 913 30 155 31 146 32 188 33 543 33 450 33 791 1,0
Yemen 5 185 5 268 5 300 5 355 5 595 5 239 5 255 0,3
Benin 3 259 3 337 3 455 3 533 3 782 3 913 3 989 1,9
Afghanistan 6 058 6 182 6 339 6 435 6 390 6 487 6 503 0,3
Congo B 1 865 1 911 1 972 2 012 2 038 2 128 2 216 4,1
Rwanda 3 525 3 621 3 743 3 820 3 889 3 958 4 010 1,3
Zambia 4 161 4 010 4 447 4 932 5 386 4 901 5 026 2,6
Liberia 1 355 1 308 1 299 1 294 1 319 1 300 1 300 0,0
Conakry 2 885 2 929 2 890 3 035 3 272 3 485 3 362 (3,5)
Cyprus 399 336 339 337 331 354 356 0,7
Bissau 490 550 575 596 636 705 689 (2,3)
South Sudan 732 704 787 839 904 982 1 084 10,4
Joint venture 44 296 45 268 46 157 46 587 47 119 46 822 48 181 2,9
Iran 41 783 42 697 43 533 43 940 44 421 44 146 45 464 3,0
Botswana 1 700 1 702 1 696 1 758 1 783 1 784 1 794 0,5
Swaziland 813 868 928 889 915 892 923 3,4
Total subscribers 210 065 214 961 219 191 223 396 227 503 230 997 233 054 0,9
ARPU
(Local currency)
Country 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 QoQ %
South Africa 95,21 93,58 89,26 91,55 87,16 88,44 96,21 8,8
Post-paid 189,30 166,37 159,76 170,00 159,52 163,86 194,58 18,7
Pre-paid 71,98 74,16 70,40 72,06 69,75 70,40 74,04 5,2
Nigeria 1 177,82 1 124,34 1 123,29 1 118,11 1 102,59 1 046,45 994,44 (5,0)
Large opco cluster
Ghana 11,73 11,97 12,02 12,59 12,32 12,53 12,52 (0,1)
Cameroon 2 469,15 2 193,14 2 274,49 2 166,95 2 225,90 2 043,26 2 169,43 6,2
Ivory Coast 3 095,89 2 883,62 2 830,00 3 133,92 2 946,57 2 797,32 2 708,13 (3,2)
Uganda 8 974,72 8 688,11 8 801,30 8 687,07 7 998,46 7 148,75 7 512,37 5,1
Syria 718,37 797,17 778,42 767,15 706,14 795,23 863,86 8,6
Sudan 12,36 13,21 13,07 13,88 14,77 15,46 15,89 2,8
Small opco cluster
Yemen 1 182,54 1 171,57 1 159,58 1 087,12 970,24 786,84 920,73 17,0
Benin 3 764,70 3 613,43 3 689,51 3 796,19 3 512,75 3 438,86 3 594,24 4,5
Afghanistan 180,62 195,43 190,33 179,85 159,27 170,64 180,09 5,5
Congo B 5 494,05 5 350,72 5 985,40 5 554,26 5 312,87 5 365,33 5 597,42 4,3
Rwanda 1 655,75 1 684,02 1 763,68 1 545,17 1 538,99 1 562,92 1 565,57 0,2
Zambia 28,58 32,57 38,33 33,70 28,61 28,34 32,00 12,9
Liberia 6,98 6,34 3,93 5,22 5,07 4,70 3,96 (15,8)
Conakry 29 163,91 22 552,64 18 718,42 20 334,09 19 190,61 17 043,90 14 874,41 (12,7)
Cyprus 18,20 19,90 19,12 17,67 17,15 17,57 17,81 1,4
Bissau 2 315,70 2 619,19 2 323,20 2 229,73 2 201,47 2 473,65 2 111,39 (14,6)
South Sudan 24,82 26,14 29,08 24,69 26,13 26,33 24,52 (6,9)
Joint venture
Iran 102 834,76 108 478,89 109 683,56 110 005,75 110 351,87 114 958,63 116 024,94 0,9
Botswana 65,00 66,00 72,00 73,56 61,04 63,21 68,24 8,0
Swaziland 100,88 100,03 98,17 102,10 94,26 93,73 103,30 10,2
ARPU
(US dollar)
Country 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 QoQ %
South Africa 9,31 8,86 8,34 8,21 7,45 7,46 7,42 (0,6)
Nigeria 7,21 6,92 6,91 6,47 5,68 5,25 4,99 (5,0)
Large opco cluster
Ghana 4,70 4,04 3,35 3,93 3,57 3,15 3,29 4,5
Cameroon 5,15 4,60 4,58 4,11 3,83 3,43 3,68 7,0
Ivory Coast 6,46 6,04 5,70 5,95 5,07 4,70 4,59 (2,5)
Uganda 3,58 3,45 3,36 3,19 2,79 2,34 2,13 (9,0)
Syria 4,81 4,88 4,60 4,06 3,31 3,04 2,95 (3,1)
Sudan 2,17 2,32 2,29 2,38 2,47 2,59 2,62 1,1
Small opco cluster
Yemen 5,50 5,45 5,39 5,06 4,51 3,66 4,06 11,0
Benin 7,86 7,57 7,43 7,20 6,05 5,78 6,09 5,3
Afghanistan 3,16 3,39 3,34 3,12 2,76 2,89 2,86 (0,8)
Congo B 11,46 11,21 12,06 10,54 9,14 9,02 9,48 5,2
Rwanda 2,46 2,49 2,58 2,26 2,27 2,25 2,21 (2,1)
Zambia 4,97 5,05 6,26 5,35 4,23 3,83 3,65 (4,7)
Liberia 6,98 6,34 3,93 5,22 5,07 4,70 3,96 (15,8)
Conakry 4,23 3,28 2,72 2,91 2,69 2,34 2,01 (14,4)
Cyprus 24,91 27,35 25,39 21,99 19,35 19,37 19,80 2,3
Bissau 4,83 5,49 4,68 4,23 3,79 4,16 3,58 (14,0)
South Sudan 7,85 8,27 9,20 7,81 8,26 8,33 7,75 (6,9)
Joint venture
Iran 4,13 4,26 4,18 4,11 4,01 4,03 3,91 (3,0)
Botswana 7,28 7,52 8,10 8,29 6,27 6,35 6,28 (1,0)
Swaziland 9,35 9,47 9,12 9,15 8,06 7,81 7,97 2,0
The financial information on which this quarterly update is based has not been reviewed or reported on by MTN’s
external auditors.
Fairland
22 October 2015
Sponsor
Deutsche Securities (SA) Proprietary Limited
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