MTN Nigeria posts $311.2-million loss in Q3 2024 amid forex volatility and rising costs
Key Points
- MTN Nigeria reports a net loss of N514.9 billion ($311.2 million) for Q3 2024.
- Revenue increased by 34% to N2.37 trillion ($1.43 billion).
- Forex losses and rising operational costs contributed to the overall decline.
Forex losses and rising costs impact profits
MTN Nigeria’s significant losses in Q3 2024 were largely driven by foreign exchange volatility, which resulted in a net forex loss of N904.9 billion ($547.1 million), up from N474.3 billion ($286.6 million) in the same period in 2023. This currency instability had a severe impact on the company's profits, despite a 34-perrcent increase in revenue, which rose to N2.37 trillion ($1.43 billion) from N1.77 trillion ($1.07 billion) in the third quarter of 2023.
Operating profit also declined by 22 perrcent, dropping from N607.5 billion ($367 million) in Q3 2023 to N475.3 billion ($287.3 million) in Q3 2024. Additionally, direct network operating expenses surged by 102 perrcent to N902.1 billion ($545.1 million), while depreciation and amortization costs increased by 22 perrcent to N384.9 billion ($232.5 million). These rising costs significantly affected the company's bottom line, leading to a loss before taxation of N713.6 billion ($431.5 million), compared to a profit of N9.8 billion ($5.9 million) in the same period last year.
MTN Nigeria’s financial position and shareholder impact
MTN Nigeria’s financial position deteriorated in Q3 2024, with total equity attributable to owners of the company turning negative at N573.6 billion ($346.6 million), down from N45.4 billion ($27.4 million) in Q3 2023. This shift reflects the substantial losses incurred during the year.
The company’s market capitalization fell by 28 perrcent, dropping to N4.01 trillion ($2.42 billion) from N5.54 trillion ($3.35 billion) as of September 2023. The market price per share also declined by 11 perrcent, falling to N191.00 ($0.12) from N215.00 ($0.13) in the previous year.
MTN Nigeria focuses on cost management and long-term recovery
Despite these financial setbacks, MTN Nigeria remains committed to managing costs and preparing for long-term recovery. The company has been heavily investing in infrastructure, with a focus on improving network quality and expanding its digital services.
CEO Karl Toriola acknowledged the difficult operating environment but expressed optimism about the future. “We are navigating through a challenging period, but we are focused on delivering value to our customers and shareholders by enhancing our service delivery and optimizing costs,” Toriola stated.
MTN Nigeria’s strategy for recovery includes cost management measures aimed at mitigating the impact of operational expenses and currency volatility as the company looks to stabilize and return to profitability.