By Bianke Neethling
MTN is set to report a loss for its 2024 financial year as foreign exchange headwinds undermine the company’s strong underlying operations.
In a trading update released on Thursday, 27 February 2025, MTN informed shareholders that its earnings would turn to losses for the 2024 financial year.
The telecoms giant explained that it expects to report a strong underlying performance despite the challenges in the operating environment.
However, it said the company remains affected by several external factors, including the negative impact of local currency devaluation over the year, particularly the Nigerian naira.
“This included both translation effects and forex losses in our financials,” MTN explained.
“An additional factor impacting our results is the operational challenges in Sudan due to the ongoing conflict in the country.”
These factors will see the company’s earnings per share (EPS) fall by over 300% to a loss per share of between 554 cents and 509 cents, compared to earnings of 227 cents in 2023.
Headline earnings per share (HEPS) are expected to fall by as much as 79% but will remain in positive territory of between 66 and 129 cents per share.
The company explained that its HEPS were negatively impacted by some non-operational items, including:
Hyperinflation adjustments of approximately -16 cents (2023: -150 cents)
Foreign exchange losses of approximately -598 cents (2023: -715 cents), which includes naira depreciation impact of approximately -399 cents (2023: -593 cents)
A deferred tax charge of approximately -58 cents (2023: nil)
Other non-operational items of approximately -46 cents (2023: -23 cents)
The significant difference between HEPS and EPS is attributed largely to impairment losses on investments, goodwill, property, plant and equipment related to Sudan.
Daily Investor calculated that MTN’s expected net loss for the 2024 financial year is between R9.6 billion and R10.4 billion.
This will be the company’s second loss since 2016, with the first being the R9.68 billion it posted for the first half of its 2024 financial year.
Despite the impact of external factors, MTN said it delivered a strong underlying performance.
The telecoms giant expects to report an improvement in the trajectory of MTN South Africa’s profitability, as well as strong operational performances in MTN Nigeria, MTN Ghana and MTN Uganda.
In particular, it highlighted the approval of tariff adjustments by regulators in Nigeria announced in January 2025.
The company said this was a significant milestone in ensuring the long-term sustainability of its business and the telecoms industry in the country.
“We are encouraged by the relative stability of some important key macroeconomic indicators in the second half of the 2024 financial year – such as inflation and foreign exchange rates in some of our key markets,” it said.
“This provided some support to our performance in the period, and we anticipate reporting a pleasing positive momentum in second-half earnings, free cash flow and holding company leverage ratio.”
MTN is expected to release its full-year results on or about Monday, 17 March 2025.