This is reflected in the company’s financial performance results for the fiscal year 2021 in the form of larger assets and better utilization of those assets.
All of this has been fueled by a phenomenal increase in the number of subscribers. Mobile voice telephony growth has been steadily declining for several years, and this trend is expected to continue into 2021.
However, growth in subscriber numbers, product enhancements, and innovations in customer value management boosted telephone growth by 4.9 percent year on year.
As a result, the contribution of service revenue fell from 41.8 percent to 31 percent year on year, with increased contributions from data and Mobile Money.
Data revenue increased by 56.3% year on year to GH2,769 million. This was due to a 54.9 percent increase in tariffs as a result of commercial intervention improvements.
MoMo was also a significant source of net income growth. Active growth in MoMo subscribership reached 38% in 2021, with merchants expanding by 29.9% and agents expanding by another 18.7%.
Growth in MoMo advanced services such as micro retail payments and international remittances also played a role.
Overall revenue for 2021 was GH7,723 billion, a 28% increase over the GH 6,033 billion generated in 2020.
As is customary for MTN, service revenues accounted for the vast majority of total revenue, generating GH7,725 million.
Importantly, earnings before interest, depreciation, and amortization (EBITDA) increased from GHc 4,249,384 million to GHc 4,249,384 million.
This increased the margin significantly from 52.7% to 55% to 3,178,181 in the previous year.
MTN’s success is based on two factors. The first is its unrivaled capital expenditure. CAPEX totaled GHc 1485 million in 2021, accounting for two-thirds of the company’s after-tax profits.
The company successfully implemented its investment plans, with a total CAPEX of GH1485 billion supporting infrastructure modernization and a 90.6 percent increase in 4G population coverage.
CAPEX totaled GHc1.215 billion in property, plants, and equipment; GHc47.3 million in intangible assets; and GH1.485 billion in right-of-way assessment.
Ultimately, MTN Ghana’s shareholder document for 2021 shows them churning pre-tax profits of GHc2,848.638 million, ploughing diluted basic earnings per share on the fiercely contested Ghana Stock Exchange, the national fiscal GSE where stocks attract some of the highest basic earnings per share on the stockmarket.
Earnings per share 2020 increased significantly, with a proposed final dividend of GHc0.085 per share. However, despite a GHc0.03 interim dividend per share paid, total dividends paid amounted to GHc 0.115. Shareholders have excellent opportunities for capital gains as well.
Although MTN’s share price has fallen marginally year to date, this is simply due to the share price freeze that was in place when it went ex-dividend.
Expect a significant increase in the company’s share price now that a dividend has been declared. Indeed, MTN has been the most traded equity on the GSE since its initial listing in 2018.
Source: Graphic Online
