AD FAILS · AD OBSERVER · ADBUZZ · ADVERTISING · AGENCY NEWS · BRAND ENDORSEMENTS · BRAND WARS · BRANDMEET UP · BRANDS · BRANDWEEK REPORT · CAMPAIGN · FINES & VIOLATIONS · TELECOMMS · TUNE IN: (COMING SOON)

[BRANDWEEK] #BUSINESSREPORT: MTN RECORDS MASSIVE LOSS AFTER NCC FINE. READ:

​MTN Group Ltd. fell in Johannesburg trading as Africa’s largest mobile-phone company after reporting a first-half year loss after agreeing to pay fines levied against it following the violation of the sim registration deadline given by the Nigerian Federal Government last November.

The shares dropped 2.5 percent to 138.13 rand by 11:25 a.m., after earlier slumping as much as 3.8 percent, the most in three weeks on a closing basis.

The N330 billion ($1.18 billion) settlement in Nigeria, announced in June, will reduce earnings per share for the six months through June by 4.74 rand, while foreign-exchange losses, joint ventures and adjustments for inflation in Iran will further hurt results, MTN said in a statement on Tuesday.

MTN is seeking to turn the page on a dispute with the Nigerian Communications Commission (NCC) which initially imposed a $5.2 billion fine after the company missed a deadline to disconnect unregistered users. 

Johannesburg-based MTN is overhauling senior management and has added new directors as it seeks to convince investors the penalty won’t be repeated and revive a share price that’s 36 percent lower than a year ago.

Earnings were also damped by under performance in MTN’s two largest markets, it said. Nigerian results were further weighed on by government-mandated subscriber disconnections and a temporary withdrawal of regulatory services, while profit margins in South Africa were narrowed by an increase in handset sales. The loss would be the first over any half-year period for at least 20 years, data compiled by Bloomberg show.

MTN, which reported earnings per share of 6.53 rand for the same period a year earlier, said it will issue a further statement once it’s ready to provide more detail about the projected loss. The final results will be announced on August 5.

©thebrandradio 2016. All rights reserved.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s