MTN GROUP PROFITS HIT USD1 BILLION MARK

Mergers, Acquisitions and Financial Results

MTN Group has posted an after tax profit of USD1 billion for the year ended March 31, 2005. This represents a 47 percent rise from the USD630 million recorded for the year ended March 31, 2004.

Earnings before interest, tax, depreciation and amortisation (EBITDA) for the South African-based mobile communication giant also rose to R12 billion while consolidated Group revenues also went up to USD4.3 million from USD3.5 million.

MTN South Africa recorded a revenue increase of 17 percent to R17.8 billion and a healthy improvement in its EBITDA margin to 34 percent, up from 30 percent for the year ended 31 March 2004.

Control

This positive trend has been underpinned by tighter control over distribution costs, improved net interconnect balances and lower handset costs due to Rand strength, but has been offset to some degree by increased postpaid subscriber acquisition costs in a competitive environment.

MTN South Africa recorded a strong subscriber growth from 6.2 million to 8 million.

Of the 8 million, 6.6 million, are pre-paid while 1.4 million are post paid. MTN's Nigerian operations grew by 34 percent to R9.3 billion (USD1.3 billion) with active subscriber base notching 4.3 million.

Total capital expenditure in Nigeria alone was R5.5 billion ($816 million), a record for any operation in the MTN Group.

He added that all profits generated by the Nigerian operations has been reinvested and an additional USD200 million has been raised from local and international financial institutions to supplement internally-generated cash flows to fund the extensive capital expenditure programme of R7 ($1 billion) approved for the 12 months to March 2006.

MTN Swaziland achieved strong subscriber growth of 71 percent, recording 145 000 subscribers while MTN Cameroon grew to 863 000 active subscribers. MTN Uganda saw subscribers reach 719,000. Average Revenue per user per month in Uganda, however, decreased to $19 (Shs33,000) from $22 (Shs38,000).

MTN Rwanda experienced a slowdown in subscriber growth, increasing its active subscriber base to 188,000.