MTN Group said it expects adjusted earnings for the first half of 2021 to fall by 5-15 percent from a year earlier, to ZAR 3.66-4.09 per share. Including a number of one-time charges, reported EPS is estimated down 75-85 percent from ZAR 6.74 for the same period in 2020. This includes impairment losses totaling ZAR 0.75 per share for MTN Yemen, non-cash losses of ZAR 2.62 per share from the deconsolidation of MTN Syria and a fair value gain on the investment in aYo of ZAR 0.96. That compares to a ZAR 3.41 gain from the disposal of towers in Uganda and Ghana in the same period in 2020.
MTN said the adjusted earnings (HEPS) also were negatively impacted by a number of non-operational and once-off items totalling ZAR 1.18 per share, including foreign exchange losses and donations for Covid-19 support. That compares to a positive impact on HEPS of ZAR 0.46 in 2020.
In the trading update, MTN said that it has made meaningful progress in strengthening its financial position, maintaining a healthy liquidity position and faster de-leveraging of the holding company balance sheet. This has been supported by upstreaming of approximately ZAR 9.3 billion in cash from its operating companies, including ZAR 4.0 billion from MTN Nigeria, in the six months to June. It has received a further ZAR 700 million in cash from Nigeria after 30 June.
MTN also reported that a magistrate has recommended to dismiss a case brought against two of its overseas operations for allegedly supporting the Taliban by making payments to the terrorist group to ensure the protection of its infrastructure. The civil damages case was brought against MTN Dubai and MTN Afghanistan, and MTN filed a motion for dismissal in 2020. The company argued that the court lacked jurisdiction over MTN Dubai and MTN Afghanistan as they do not operate in the US, nor was there any claim that they violated the US Anti-Terrorism Act.
MTN will release full interim results on 12 August.
