MTN Uganda, a pioneering telecommunications giant, has announced a staggering net profit of Shs. 228 Billion in the first half of 2023, a feat attributed to their strategic investments in data-driven technologies and the burgeoning fintech realm.
Sylvia Mulinge, the Chief Executive Officer of the company, along with Andrew Bugembe, the Executive Director, unveiled the positive developments during a press briefing in Kampala on August 4th.
“We are happy with the results, I am happy with the work being done by our team in terms of product and service innovations in line with our customer needs,” Mulinge told journalists.
Based on the findings, service revenue experienced a 15.0 per cent rise, propelled by positive growth across voice, data, and fintech sectors.
In the first six months of this year, voice revenue grew by 9.4 per cent to Shs544bn compared to Shs497bn during the same period last year.
This growth was driven by an expanding customer base. The telco’s net subscriber additions for H1 2023 increased by 910,000 customers, reaching 18.1 million, due to improvements in customer value management and competitiveness.
The company’s net promoter score, which gauges customer likelihood to recommend MTN services, improved, reflecting better network quality, product innovation, and brand appreciation. During this period, the company eased congestion by migrating 2G customers to 3G.
Data revenue grew by 22.1 per cent to Shs290bn, with active data subscribers rising by 21.4 per cent to 6.9 million. This success was attributed to efforts in driving smartphone adoption and improved offerings for small and medium enterprises.
Home broadband revenue surged by 50.4 per cent, aligning with the remote work trend. Fintech revenue, derived from MTN MOMO Pay and related services, increased by 18.6 per cent to Shs358bn, driven by payment and international remittance growth.
The company’s tax payment to the government increased by 19 per cent, and the directors proposed a first interim dividend of Shs5.6 per share. Earnings per share rose by 18 per cent from Shs8.6 in H1 2022 to Shs10.2 in H1 2023.
Second Half Strategy
The company foresees sustained positive growth linked to Bank of Uganda’s economic growth forecasts. Bugembe mentioned that the current monetary policy position, along with decreasing global inflation, is likely to keep inflation around 5 per cent in the third quarter, thereby boosting their performance.
He further stated, “Our focus for the rest of the year will revolve around flawlessly executing our Ambition 2025 initiatives, which involve advancing leading-edge connectivity operations using the newly allocated spectrum. Anticipate enhanced data speeds, the introduction of e-SIMs, and 5G connectivity to cater to our expanding customer requirements”
Richard Yego, Managing Director of MTN Mobile Money Uganda Limited, affirmed their commitment to expedite the shift to cashless transactions through strategic partnerships and an assertive approach to the mobile money ecosystem, thereby enhancing fintech sector performance.
“We have resumed the rollout of MoMo agents to meet the growing market demand and are modifying our merchant proposition,” Yego said.
Mulinge mentioned that they would maintain disciplined capital allocation in their investments and carefully manage the company’s working capital to protect its balance sheet and liquidity position, considering the financial aspect.
As the digital age continues to reshape traditional financial paradigms, MTN’s financial triumph stands as a resounding testament to the transformative power of fusing data and fintech, propelling the company to unprecedented heights in the realm of profitability.
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