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Johannesburg - Africa’s biggest mobile network MTN Group [JSE:MTN] has recorded a 51% drop in full-year profit as the company has set aside R9.29bn for its record multi-billion Nigerian fine.
MTN, in its annual financial 2015 results announcement on Thursday morning, said that its reported basic headline earnings per share (HEPS) declined by 51.4% to 746 cents.
The company said this drop was “largely a result of the Nigerian regulatory fine provision (R9.29bn), which had a 402 cents negative impact on HEPS”.
Late last year, Nigerian regulators fined MTN $3.9bn for failing to disconnect 5.2 million unregistered subscribers. MTN, last month, also dropped a Nigerian court challenge of the fine as the company made a R3.8bn ‘good faith payment’ to Nigeria in a bid to reach a settlement.
MTN said on Thursday morning that talks are continuing between the company and Nigerian authorities regarding the fine.
Other results from the company indicated that its revenue increased 0.1% to R146.35bn and that the group’s total subscriber base increased 4.1% to 232.5 million.
The group’s earnings before interest, tax, depreciation and amortisation (Ebitda) decreased 8.6% to R59.92bn.
The company, though, still announced a final dividend of 830 cents per share, with total dividend of 1 310 cents per share.
However, for the 2016 financial year, MTN is planning on declaring a minimum dividend of 700 cents, subject to developments in Nigeria regarding the fine.
Meanwhile, the mobile network's South African unit showed stronger results.
MTN South Africa recorded subscriber growth during the period of 9.3% to 30.6 million, an increase in revenue of 2.9%, a data revenue jump of 37.2% and an Ebitda margin increase of 1.3 percentage points to 33.4%.
MTN's share price on the Johannesburg Stock Exchange was also up just over 7% in Thursday morning trade to R145.50 at 09:52.
MTN is the continent's biggest mobile network as it operates across 22 countries in Africa and the Middle East.
