MTN Group 1st Half Profit Slipped; Agrees Investment With Mastercard

By Joe Hoppe

MTN Group's pretax profit fell on higher costs and depreciation, amortisation and impairments, and it has signed a memorandum of understanding for investment with Mastercard.

The South Africa-based telecommunications group said Monday it generated a pretax profit of 18.31 billion South African Rand ($966.2 million) compared with ZAR18.58 billion a year earlier.

Basic earnings per share--one of the company's preferred metrics--rose to 511 South African cents a share from 445 cents. Headline EPS--which strips out exceptional and other one-off items--rose to 542 cents from 506 cents.

Revenue rose to ZAR113.20 billion from ZAR97.49 billion. Within this, data revenue grew 16.5% while fintech revenue grew 21.4% on a constant currency basis.

The board hasn't declared a dividend for the half year but said it expects to pay a final declaration of ZAR3.3 a share for the year.

MTN said the business is managing challenges in its operating environment and the near term hits to its top-line and margins, and backed its medium-term guidance. It has previously guided for at least mid-teens group service revenue growth in the medium-term.

The company also said it has signed a memorandum of understanding with Mastercard, providing for a minority investment in MTN's fintech business based on a total enterprise valuation of around $5.2 billion. Signing of definitive investment agreements is expected in the near term.

Write to Joe Hoppe at joseph.hoppe@wsj.com

(END) Dow Jones Newswires

August 14, 2023 03:36 ET (07:36 GMT)

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