MTN Nigeria; Poor services, Higher Profit

Despite poor services in Nigeria, MTN Group Ltd., Africa’s largest mobile-phone company, said first-half profit rose 22 percent after it expanded the network and increased data clients and Nigerian subscribers. Net income climbed to $970 million (7.63 billion rand) in the six months ended June 30 from 6.24 billion rand a year earlier, the Johannesburg-based company said in a statement to the city’s stock exchange

today. Sales increased 24 percent to 57.3 billion rand.

On Aug. 20, MTN said exclusive merger talks with India’s Bharti Airtel Ltd. would be extended for a second time, to Sept. 30. A merged company would have revenue of more than $20 billion and 200 million subscribers from Mumbai to Cape Town.

“No decision or agreement to acquire any shares or global depository receipts or implement the potential transaction” has been made by the boards of MTN or Bharti, Phuthuma Nhleko, MTN’s chief executive officer, said in the statement.

MTN rose 0.5 percent to 127.99 rand at 9:22 a.m. in Johannesburg trading.

The total number of MTN subscribers increased 14 percent from December to 103 million. Subscribers in Nigeria rose 19 percent to 27.3 million.

Subscribers in South Africa grew by 62,000 over the six- month period to 17.2 million. “The disappointing increase in subscribers was due to a combination of factors including challenges on the network and supporting systems, slowing growth, pressure on consumer spend, and competitor activity in the first half of the year,” MTN said in its statement.

Data Source; BLOOMBERG