Namibia’s MTC Profits Up 1,8 Per Cent for 2007

Mergers, Acquisitions and Financial Results

Namibian mobile operator MTC has netted a 1.8 per cent net profit increase for 2007, just N$8,8 million more than at the end of 2006, due to notable rises in certain costs like staff, sales, marketing and transmission costs. Subscribers increased to 743,509, of which 676,831 are prepaid customers.

"Total revenue in 2007 grew by 18,7 per cent to N$1,1 billion, up from N$944 million in 2006; net profits only increased by 1,8 per cent, being N$493,5 million, compared to N$484,7 million in 2006," MTC Chief Executive Officer Miquel Geraldes said in a presentation to the business sector last week. Earnings before tax increased from N$568,1 million in 2006 to N$586,6.

"Income from contract customers was N$254,6 million, up from N$219,4 million in 2006, and earnings on prepaid [Tango] came to N$622,3 million against N$498,6 million the year before. Capital expenditure came to N$339 million, much higher than the N$217 million in 2006. All capital projects were funded from our own resources," Geraldes said. Dividends paid out per share increased by 206 per cent from N$3.20 in 2006 to N$9.80 per share.

"On the regulatory front we had some surprises with the introduction of an additional mobile service [Switch] by the fixed line operator, Telecom Namibia. This is a controversial development since Government sold a 34 per cent stake in MTC to a private entity, Portugal Telecom. The sale took place with the understanding that there will be only two mobile operators in the Namibian market for the next few years [MTC and Cell One],"Geraldes added.

He also called the decision of the Finance Ministry's to slap 15 per cent VAT on airtime sold to prepaid customers "an unpopular decision."

The Namibian