Nigerian investors reaffirmed their belief in the nation’s largest telecommunications firm, MTN Nigeria, as they oversubscribed its commercial paper offer to the tune of N125 billion. The final result of the offer was higher than the initial targeted amount of N100bn, MTN Nigeria announced yesterday.
“MTN Nigeria Communications hereby notifies the Nigerian Exchange Limited and the investing public of the successful completion of its Series 6 & 7 commercial paper issuance under its upsized N250 billion Commercial Paper Issuance Programme. MTN Nigeria sought to raise N100 billion, and the over recorded 146% subscription with N125 billion issued across both series. This represents the largest aggregate CP issuance within a calendar year by any corporate in Nigeria’s debt capital markets,” MTN said in a note to the exchange.
Karl Toriola, chief executive officer of MTN Nigeria, expressed his satisfaction with the offer results.
He said: “We are pleased with the support received from the investor community, having recorded 146% subscription. This reflects MTN Nigeria’s robust financial capacity, the brand’s strength, and our leading role in the industry.”
On August 16, MTN Nigeria floated a N100bn commercial paper programme comprising Series 6 and 7 through which it wanted to raise N100 billion. According to the telecoms giant, the money was meant to bolster its working capital.
“The issuance is part of the company’s strategy to diversify its financing options with the funds being deployed towards short-term working capital and funding requirements,” MTN said.
The offers comprised a 181-day CP at a yield of 13 percent and another 265-day CP at a yield of 13.5 percent, both with an issue date of 23 August 2023.
According to the Nigerian Communications Commission, NCC, as of June 2023, MTN Nigeria controlled the largest market share in the nation’s telecoms industry with 84.66 million subscribers, representing 38.52 percent market share. It was followed by Globacom with 61.33 million subscribers, which amounted to 27.91 percent market share. Airtel with 60.19 million subscribers, controlled 27.39 percent while 9mobile with 13.58 million controlled just 6.18 percent market share.
As at half year 2023, Nigeria’s teledensity stood at 115.3 percent, a significant improvement over 108.15 percent as of June 2022. The GDP growth rate at half year 2023 in the nation’s information and telecommunications sector was 8.6 percent, with the telecommunications sub sector surpassing all other sub sectors at 9.74 percent.
MTN Nigeria’s half year results ended 30 June 2023 were mixed. Revenue for the period rose by 21.96 percent to N1.16 trillion, up from N950.09 billion in the comparable period in 2022.
On the flip side, profit after tax for the period declined by 29.3 percent to N128.59 billion, compared to N181.94 billion realised in the comparable period in 2022.
Revenue from voice and data services accounted for the bulk of the revenue MTN Nigeria generated at half year 2023. The telecoms giant made N474.10 billion as revenue from voice services as of June 2023, compared to N417.28 billion it made in the comparable period in 2022. Data services generated N469.38 billion for MTN Nigeria as at June this year, as against N348.23 billion as of June 2022.
Interconnect and roaming services served as the third highest revenue generating services for MTN, as the firm made N84.09 billion this June in contrast to N77.76 billion last year June.
For the financial year ended 31 December 2022, MTN Nigeria gave 5,192 shareholders final dividends in the forms of shares equivalent to 641,047,053 new ordinary shares at N232.68 per share, thus increased its outstanding shares to 20,995,560,103
