MTN Group remains on track to report a total 2018 dividend of R5/share, despite “continued challenges in repatriating funds from MTN Irancell”, it said in notes alongside interim results for the six months to 30 June.
Read: MTN H1 profit down 7%
“The board remains committed to plans to declare a total dividend of 500c/share for 2018 and is targeting growth of 10% to 20% over the medium term,” it said.
MTN declared an interim dividend of R1.75/share.
So far this year, MTN Group has repatriated €88-million from MTN Irancell, including €61-million relating to the full 2017 dividend due as well as a further €27-million of historic dividends. “Opportunities for repatriation within the legislative framework continue to exist. However, MTN Group has not factored these into our cash flow forecasts,” it said.
In May, the US announced plans to reimpose economic sanctions in Iran. The first round of these sanctions became effective this week, with a second round coming in early November.
“The sanctions may limit the ability of the group to repatriate cash from MTN Irancell, including future dividends. As at 30 June 2018, Iranian rial-denominated dividends receivable and loans amounted to R3.4-billion. The official exchange rate to the US dollar was 42 490 rials at 30 June 2018 and has remained largely unchanged since April 2018. Sanctions may place pressure on the official exchange rate that is used to translate dividend and loan receivables as well as the equity-accounted results of MTN Irancell.”
The group said it reported overall improved constant-currency results, “delivering broadly on our medium-term targets as we remained focused on executing our Bright strategy”.
“Growth in service revenue accelerated, margins on earnings before interest, taxation, depreciation and amortisation (Ebitda) increased, and voice, data and digital revenue continued to expand.”
Ebitda growth in Nigeria was particularly strong, it said. South Africa, Nigeria and Ghana reported strong results, though the enterprise segment in South Africa underperformed, placing a drag on service revenue growth.
“Against our medium-term target of upper-single-digit growth in group service revenue, we delivered a 10.2% increase in constant currency terms. This was led by growth of 17% by MTN Nigeria, 27.9% by MTN Ghana and 2,9% by MTN South Africa. Among our large operations, MTN Uganda also contributed positively. However, MTN Cameroon and MTN Ivory Coast reported declines.”
At 30 June 2018, the group had 223.4 million subscribers, up from 217.2 six month previously. — (c) 2018 NewsCentral Media
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