MTN Group said it expects basic headline earnings per share (HEPS) and basic earnings per share (EPS) for the first half to decline due to under-performance in Nigeria and South Africa. In a trading statement for the six months ended 30 June, the operator said in the prior year comparable period it reported HEPS of ZAR 6.54 and EPS of ZAR 6.53.
The expected decline in earnings is primarily the result of the regulatory fine imposed on MTN Nigeria following a resolution with the Nigerian government on 10 June. The Nigerian regulatory fine is expected to have an estimated negative impact of ZAR 4.74 on EPS.
The operator said Nigeria's performance was impacted by the disconnection of 4.5 million subscribers in February, the final batch of subscribers to be disconnected in compliance with the Nigerian Communications Commission subscriber registration requirements. The withdrawal of regulatory services, which was re-instated on 15 March with approval for promotions and price plans granted in early May, also negatively impacted MTN Nigeria's performance.
MTN South Africa is expected to report a decline in the EBITDA margin, impacted by the marked increase in handsets sold during the period. It said foreign exchange losses in a number of operations, losses from joint ventures and associates and hyperinflation adjustments on MTN Irancell are also expected to have a negative impact on HEPS and EPS for the period.
It promised to issue a further trading statement once the company obtains a reasonable degree of certainty as to the likely range within which the HEPS and EPS are expected to be finalised. The company's interim results will be announced on 5 August.
