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Johannesburg - Subscriber growth for mobile network MTN [JSE:MTN] has been “muted” in South Africa, according to the group’s quarterly report for the period ending March 31 2015.
The Johannesburg Stock Exchange (JSE) listed MTN Group recorded 28 million subscribers in South Africa for the period.
MTN added that its contract and prepaid subscriber base in South Africa declined marginally to 5.4 million and 22.6 million respectively.
Seasonality, challenges in the distribution channel and lower handset sales are blamed for the lack of growth in its SA subscriber base.
MTN’s blended Average Revenue Per User (ARPU) in SA also fell by 4.8% in the quarter to R87.
“Despite this, the operation remained competitive increasing total minutes by more than 100% year on year. Total minutes declined 6.1% quarter on quarter, impacted by seasonality,” said MTN of its SA operations in its quarterly update.
“Data revenue showed strong growth of 21.8% year on year (YoY) and now contributes 27.7% to total revenue. This was supported by attractive data promotions including data bundles and segmented e-journey communications. Data usage increased 62.6% YoY while data users increased 18.1% YoY to 17.2 million,” said MTN.
MTN added that its South African operation “continues to focus on cost containment initiatives and optimising its operating model”. The network provider has been undergoing retrenchments as well as cost-cutting measures over the last year.
Group results
Growth in South Africa may be sluggish for MTN, but the group added 4.1 million subscribers to its overall operations in 22 countries in Africa and the Middle East.
This means MTN now has 227.5 million subscribers across the region.
Gains have also been reported in MTN’s biggest market Nigeria.
MTN Nigeria increased its subscriber base by 2.1% to 61.1 million users. MTN says that total minutes on its Nigerian network fell by 2% during the quarter owing to seasonality.
But local currency data revenue in Nigeria climbed by 17.0% year on year and contributes 19.7% to the operation’s total revenue.
“We continue to focus on our non-voice services which remain the key driver of the group’s revenue growth. In the quarter, we bolstered our management team to facilitate growth in these areas,” said MTN Group president and CEO, Sifiso Dabengwa, in a statement.
“We appointed a group chief consumer officer and have made provision for the appointment of an executive for our digital business. Data revenue increased by 16.7% as we expanded our 3G and LTE networks and stimulated the adoption of data-enabled devices and smartphones,” he added.
