MTN Group Limited has announced its trading statement for the full year ended December 31, 2023. The company foresees a substantial decrease in earnings per share (EPS) for the fiscal year, primarily attributed to challenges faced by its Nigerian operations.
Earnings Outlook
According to MTN’s trading statement, the company expects a decline in EPS ranging from -90% to -70% for FY 2023 compared to the previous corresponding period. This translates to a projected EPS range of -964 cents to -750 cents, marking a significant downturn from the previous year’s performance.
The anticipated decrease in earnings is mainly due to the adverse impact of the sharp devaluation of the Nigerian naira against the US dollar. MTN Nigeria, a key subsidiary, faced higher operating and net finance costs, primarily driven by foreign exchange losses.
Factors Contributing to Decline
MTN Nigeria’s financials bore the brunt of the currency devaluation, with estimated foreign exchange losses of 593 cents, significantly higher than the previous year. Additionally, non-operational items, such as impairment losses and gains/losses on disposals, further impacted the company’s financial performance.
Despite MTN Group’s operational resilience in a challenging environment, these external factors have led to an overall decline in earnings for FY 2023. The company emphasizes that its solid underlying operational performance was overshadowed by currency fluctuations and non-operational expenses.
Dividend Declaration and Outlook
Despite the expected decline in earnings, MTN Group’s Board of Directors anticipates declaring a dividend in line with guidance. The company aims to maintain a minimum ordinary final dividend of 330 cents per share for FY 2023, demonstrating its commitment to shareholder returns amidst challenging market conditions.
MTN Group’s financial results for the fiscal year are expected to be formally announced on the Stock Exchange News Service (SENS) around March 25, 2024. Investors and stakeholders await further details on the company’s performance and strategic outlook moving forward.
Conclusion
As MTN Group prepares to unveil its financial results for FY 2023, the company braces for a significant earnings decline driven by external factors, particularly the currency devaluation impacting its Nigerian operations. Despite operational resilience, challenges in the operating environment have weighed heavily on financial performance. The company remains committed to delivering value to shareholders while navigating uncertainties in the telecommunications industry.
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