Presenting its 2019/2020 financial results in Windhoek yesterday, Namibia’s first-ever mobile telecommunications company, MTC, recorded N$2.683 billion in revenue, representing a 2.66% increase from the last financial year.
This strong performance amidst a challenging economic environment exacerbated by the global pandemic enabled the company to declare a total of N$ 977.8 million in dividends to its shareholders, of N$611 million was paid in December 2019, and the remaining N$366.8 million in June 2020.
According to MTC MD Dr Licky Erastus, the increase in revenue is owed to the company’s strategic response to the market’s evolving needs; cost containment, and improved customers’ experience, resulting in customer base growth and increased data revenue. He noted that the additional June dividends were declared to address the concern that excess cash holdings were limiting MTC’s Return on Equity (ROE). For the year 2020, ROE stands at 36.4% compared to 34.5 in 2019.
However, increasing tax rates did not spare the company as Net Profit After Tax decreased by 3.09%, which is a decline from N$797 million in 2018/19 to N$772.4 million recorded this year. Meanwhile, MTC achieved 0.5% growth in its EBITDA (Earnings Before, Interest, Taxes, Depreciations and Amortisations) margin to record an increase of N$1 397.1 billion, compared to last year’s 1 345 billion. Erastus explained that this increase in the EBITA margin is attributed to growth in prepaid customer revenue due to competitive new Multiple Aweh, and Taamba products, and an increased trend in data traffic.
“Despite challenges from external environments such as Covid-19 restrictions, unavailability of power and slow approval of fibre installation as well as currency depreciation against the US$, the company managed to record Capital Expenditure increase by 5% to N$535 million. Most of this expenditure was on network expansion projects such as 081Every1 and Capacity 2020,” read a statement from MTC.
At the results presentation held at a local hotel, Erastus stated that MTC’s balance sheet remains healthy, with no gearing and sufficient cash to maintain the quality of its network, pay attractive dividends, and fund its growth strategy. In terms of subscribers, MTC currently has 2.575 million active subscribers, up from 2 524 million last year. Erastus acknowledged that these active subscribers are more than the Namibian population and explained this number stems from users having more than one mobile device.
MTC now enjoys 91% mobile market share, and is at 97.18% within reach of fulfilling its commitment to achieve 100% network coverage by population settlement, which it aims to achieve by 2023.
“MTC will continue with its broad themes of revenue growth, market leadership, customer experience, and operational efficiency and its growth strategy. This is implemented through eight strategic focus areas. At the core of our strategy is the adherence to a customer-centric culture, and a drive to digitally transform our current and future customers’ experience,” Erastus concluded.
MTC still intends to list on the Namibian stock exchange, which will make it the first successfully listed State-Owned Enterprise. The stock exchange listing is now anticipated to be concluded before the end of 2022.