MTN warns of 79% plunge in annual results on Nigerian currency woes

MTN Group, the telecoms giant grappling with recent woes in Nigeria, expects a steep decline in headline earnings per share (Heps) for the full year ended December 31, 2024, it said in a trading update released on Thursday.

The group forecasts Heps to fall between 59% and 79%, in a range of 66c to 129c, down from 315c in 2023. 

Earnings per share are set to plunge more than 100%, swinging to a loss of 509c to 554c from a 227c profit in 2023.

The results are impacted  by several external factors including the negative impact of local currency devaluation in 2024, particularly the naira, against the dollar. This included both translation effects and forex losses in its financials. An additional factor knocking the results is operational challenges in Sudan due to the ongoing conflict in the country.

MTN says the downturn in its expected results is largely due to foreign exchange losses, with the naira’s depreciation against the dollar inflicting a R3.99 hit per share, part of a broader R5.98 forex loss tally. Other non-operational drags include a 16c hyperinflation adjustment, a 58c deferred tax charge and 46c in additional items.

It said it was encouraged by the relative stability of some important key macroeconomic indicators in the second half of 2024 – such as inflation and foreign exchange (forex) rates in some of its key markets. This provided some support to its performance in the period and the group anticipates reporting a pleasing positive momentum in the second half earnings, free cash flow and holding company leverage ratio.

In its larger operations, MTN expects to report an improvement in the trajectory of MTN South Africa's profitability, particularly in the second half , as well as strong operational performances in MTN Nigeria, MTN Ghana and MTN Uganda.

"The approval of tariff adjustments by regulators in Nigeria, announced in January 2025, was a significant milestone in ensuring the long-term sustainability of our business and the telecoms industry in the country. MTN Nigeria has started to implement the tariff adjustments, which represent an important step towards addressing the impacts of the prevailing economic challenges on the operation," it said. MTN's annual results are due on March 17, 2025. 
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