The difficulties of doing business in Nigeria: MTN and Airtel’s 2022 H1 reports
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The difficulties of doing business in Nigeria: MTN and Airtel’s 2022 H1 reports

Airtel Africa and MTN Nigeria announced their 2022 first half (H1) financial reports last week. While excellent by many standards, the financial statements were hampered by the difficulties of doing business in Nigeria.

Airtel Africa held a conference call with investors and analysts on Thursday, July 28, to answer questions about its half-year 2022 results report. During the 38-minute call, most analysts and investors wanted to know the number of active Airtel users in Nigeria, the impact of the unpredictable foreign exchange rate and rising inflation on the company’s profit margin, and the repatriation of profits from Nigeria.
MTN Nigeria’s 2022 H1 earnings report reiterated these concerns.

Airtel Africa, which operates in 14 African nations and has over 131 million customers, recorded $1.2 billion in sales in the first half of 2022, up 13 percent from last year. The company made $178 million in profit, a 25% increase.

The telecom giant, which divides its African operations into three geographical segments: Nigeria, East Africa, and Francophone, reported that its total revenue across both mobile services and mobile money increased by 18.3% in its most significant part, Nigeria, by 14.1 percent in East Africa, and by 11.7 percent in Francophone Africa.

MTN Nigeria recorded a total profit of 181 billion ($300 million)* for the first half of 2022, a 28% increase over last year’s profit of 141.8 billion ($235 million). The company reported sales of 950 billion ($1.58 billion) for the first half of the year, which was 20% more than the revenue of 791 billion ($1.3 billion) in H1 2021.

Voice calls provided the most considerable revenue across its various operational sectors, totaling 501.8 billion ($836 million), up 2.9 percent from 487.6 billion ($812.6 million). Data sales came in second at 348.4 billion ($580.6 million), up 51.6 percent from the same time in 2021. The fintech segment pulled in 40.4 billion ($66.67 million), representing a 27.8% increase from the previous year. This is partly attributable to the 87.3% increase in fintech subscribers to 11.5 million, brought on by 4.2 million newly registered (and 2.4 million active) MoMo wallets following the debut of its Payment Service Bank (PSB) on May 19, 2022.

In April, the Nigerian Telecommunication Commission issued a directive to telecom providers to restrict outbound calls for subscribers who had not linked their National Identity Number (NIN) to their SIMs.

As a result, Airtel and MTN barred 13.6 million and about 10 million subscribers, respectively. Since then, the two telcos have been able to reactivate approximately 20% of these subscribers. MTN has reactivated 2.6 million users, while Airtel has revived 2.5 million.

“Of the 13.6 million [restricted] clients, about 5.3 million afterward submitted the NIN…

“We have reconnected around 2.5 million of the 5.3 million subscribers,” Airtel Africa Group CEO Segun Ogunsanya stated on the results call.

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