MTN feeling bullish on solid 2021 results and strong fintech growth

South African operator group MTN delivered its 2021 numbers and they seem to be headed in the right direction.

MTN operates in 19 markets across Africa and the Middle East, so its performance is a decent barometer of how the telecoms industry is faring across that extended continent. Annual service revenue grew by 18% in 2021, with EBITDA up 24% and margin up a couple of percentage points. MTN’s shares were up by 4% today.

“We adapted to the extraordinary circumstances brought about by the COVID-19 pandemic and started shaping the MTN of the future through the execution of Ambition 2025,” said MTN Group President and CEO Ralph Mupita. Ambition 2025 seems to be the standard, vague corporate strategy statement, specifically: ‘Leading digital solutions for Africa’s progress is driving accelerated growth and faster deleveraging, positioning MTN for greater relevance to 2025.’

Here are the headline figures from the MTN annual report.

MTN’s mobile money brand is MoMo which, as you can see, is growing rapidly both in terms of users and ARPU. Africa has long been presumed to be a fertile market for mobile money, with lower than average access to other financial services among its population, so MTN’s growth in this area may signify that market is experiencing significant growth.

“In a challenging macro-economic environment across our markets, we also experienced what we see as structurally higher demand for data services and accelerating transaction values in our fintech businesses,” said Mupita. “We remain focused on providing leading digital solutions for Africa’s progress and creating shared value for our stakeholders. Our enhanced medium-term guidance reflects the growth we see across our markets, as we play our part in driving digital and financial inclusion across Africa.”

In a subsequent media briefing Mupita indicated he is actively looking for investment partners in the fintech side of the business, so he clearly wants to build on this momentum. Last week MTN signed an agreement with Rakuten Symphony to get started on Open RAN in some of its markets, so the company clearly has big plans for growth now the pandemic is largely behind us.