MTN Ghana stock surges to record high following strong first quarter performance
MTN Ghana, known on the Ghana Stock Exchange as Scancom Plc, has seen a remarkable increase in its stock value, reaching an all-time high on Tuesday, April 30.
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This surge came on the heels of the release of the company's 2024 first-quarter earnings report, which showcased impressive financial and operational achievements.
The share price of MTN Ghana rose by 11 pesewas, marking a substantial 6.7% increase, to reach GH₵1.75. This significant jump surpassed the previous record high of GH₵1.65 recorded in March, indicating strong investor confidence in the company's performance and prospects.
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Total revenue for the quarter to end-March was 32.5% higher at 3.85-billion cedis, while profit after tax rose to 1.11-billion cedis from 745.4-million cedis a year ago. Service revenue grew by 32.4% to 3.83-billion cedis.
The first-quarter report highlighted substantial growth in service revenue, with a notable 32.4% increase to GH₵3.8 billion from GH₵2.9 billion in 2023. This growth was primarily driven by robust performances in data services, Mobile Money (MoMo), and voice communications. The company invested GH₵327.1 million in maintaining network quality, expanding coverage, and enhancing IT systems, further contributing to its positive performance.
Data revenue witnessed an impressive 60.0% year-on-year growth, reaching GH₵1.8 billion. This growth was supported by pricing initiatives implemented in the previous quarter and increased usage per active user. As a result, data revenue contributed significantly to total service revenue, accounting for 47.4% of the total.
Mobile Money revenue also experienced substantial growth, increasing by 35.5% year-on-year to GH₵870.6 million. This growth was driven by an expansion in the active user base and increased usage of MoMo services such as cashout, peer-to-peer transfers, and advanced services.
Despite challenges such as high inflation impacting costs, MTN Ghana managed to increase its EBITDA by 31.6% year-on-year, reaching GH₵2.1 billion. The company's commitment to expense efficiency programs helped mitigate some of the cost pressures.
MTN Ghana's contributions to the country's fiscal and socio-economic growth were highlighted, with the company paying GH₵1.7 billion in direct and indirect taxes in the first quarter. These payments accounted for 47.4% of MTN's total revenue during the period, demonstrating its significant role in supporting Ghana's development goals.
The company also provided updates on its localization efforts, reporting progress in localizing Scancom PLC and MobileMoney Limited. MTN Ghana increased the reported localization of Scancom PLC by 1.7 percentage points to reach 26.8%, showcasing its commitment to working closely with regulators and stakeholders in this regard.
Overall, MTN Ghana's strong first-quarter performance and strategic initiatives position the company as a key player in Ghana's telecommunications sector, with a focus on sustainable development and continued growth.
Follow writer on X: Kweku Zurek