Primer

MTN Group Limited Primer

MTN is Africa's largest mobile and fintech operator, generating ZAR226.7bn of FY2025 revenue from 307.2m customers across 16 markets in South Africa, Nigeria, West/Central and Southern/East Africa, and the MENA region — earning fees from connectivity (data, voice, enterprise) and MoMo (mobile money, payments, lending, remittances). The story matters now because FY2025 marked an inflection year: Nigeria swung back into profit, EBITDA margin jumped 11.5pp on a reported basis to 43.5%, net debt/EBITDA fell to 0.3x, and the board (i) lifted the dividend 45% to 500 cents, (ii) authorised a R6bn buyback over three years, and (iii) announced the IHS Africa tower acquisition on 20 February 2026 ahead of its 10 June 2026 Capital Markets Day on the new "Ambition 2030" strategy.

A consistent five-year daily price feed was not available in the local dataset; only the two confirmed JSE closes are charted above. Qualitatively, MTN rallied sharply post-COVID into late 2021, derated through 2022-2024 as the naira devalued and Nigerian results swung to a loss, and has re-rated again from H2 2025 as Nigeria returned to profitability and EBITDA margins expanded.

Reported figures swing on hyperinflation accounting (Ghana, Sudan, South Sudan, Iran) and FX. On a constant-currency basis, FY2025 service revenue rose 22.7% — management said this was the strongest growth since 2008 — and EBITDA margin lifted 5.4pp to 44.5%. The Q1 2026 trading update (12 May 2026) showed momentum continuing: group service revenue +21.1% CC and EBITDA margin a further 3pp wider at 47.6%.

Business In One Page

MTN earns money in three platforms — Connectivity, Fintech (MoMo) and Digital Infrastructure (Bayobab) — across a portfolio of pan-African operating companies, the largest being MTN Nigeria, MTN South Africa and MTN Ghana. Connectivity drives most revenue: data revenue rose 36.4%in constant currency to R101.5bn (46.4% of group service revenue), supported by 9.4% growth in active data customers to 172.6m, 25.6% higher usage per user (ex-JVs) to 12.5GB, and 27.0% data traffic growth. Voice contributed R62.0bn (CC +11.2%, mainly Nigerian price adjustments) and enterprise added another R-block of growth (+11.5% CC).

Fintech (MoMo) is a scaled mobile-money ecosystem: 69.5m monthly active users (+10.0%), 1.4m active agents, 2.1m active merchants, fintech transaction volumes of 23.3bn (+14.9%) and transaction value of US$500.3bn (+37.6%). Fintech revenue grew 23.2% CC to R28.8bn with an EBITDA margin of 42.8%. Advanced services (payments, BankTech lending, InsurTech, remittances) reached 34.1% of MoMo revenue, with loan value facilitated up 80.4% to US$3.5bn and cross-border remittances of US$6.2bn.

Digital Infrastructure (Bayobab) delivered external revenue of R5.6bn and is being scaled by the pending IHS Africa tower acquisition (announced 20 February 2026) plus AI-enabled data-centre build in South Africa and Nigeria.

Geographically, FY2025 service revenue was 28.1% Nigeria, 20.2% South Africa, 16.3% Ghana, 8.1% Uganda, 6.1% Cameroon, 4.6% Côte d'Ivoire and 16.6% other — Nigeria has overtaken South Africa as the single largest service-revenue contributor. The unit economics screen attractive at the operating-company level: MTN Nigeria EBITDA margin 52.7%, MTN Ghana 60.2%, MTN Uganda 53.7%*, with MTN South Africa softer at 34.5% (down 2.9pp on prepaid weakness and a staff-share scheme hit). Capex intensity was 17.0% (R38.5bn ex-leases), within the 15-18% target range.

Valuation And Balance Sheet Snapshot

At R206.58 the equity is capitalised at roughly R378.8bn (1,833.7m shares in issue per the 16 March 2026 dividend declaration) — Simply Wall St lists the equivalent ADR market cap at US$22.9bn. On reported FY2025 attributable profit of R20.3bn (basic EPS 1,113c, HEPS 1,274c, Adjusted HEPS 1,359c), this is roughly 18.6x reported HEPS and 15.2x adjusted HEPS. The 500c dividend implies a 2.4% trailing yield; with the new framework targeting 40-60% of equity FCF in shareholder remuneration (including up to R6bn of opportunistic buybacks 2026-2028), the run-rate distribution could step higher.

Balance sheet has materially de-risked over Ambition 2025: group net debt fell to R23.5bn (Dec-25) from R41.5bn (Dec-24), net debt/EBITDA dropped to 0.3x (vs 0.7x and a 2.5x covenant), Holdco leverage improved to 1.3x (from 2.2x in 2020), and US$-denominated Holdco debt is now only 16% of the mix (down from 48% in 2020 — a deliberate reduction in FX risk). Holdco liquidity headroom was R43.1bn including R20.4bn cash. Adjusted ROE rose to 25.6% (from 18.7% restated FY2024). The market is now framing MTN as an emerging-markets cash-compounder rather than a deleveraging story: structural data and fintech growth in Africa, a stabilised naira, and the IHS deal as the next major capital-allocation event.

What Changed Recently

• FY2025 results released 16 March 2026 (mtn-investor.com/reporting/annuals-2025): service revenue +22.7%CC to R218.5bn — "best growth since 2008" per the earnings call — EBITDA before once-off items +36.8% CC to R98.5bn (margin 44.5%* CC, +5.4pp), Adjusted HEPS +67.0% to 1,359c, FCF +345.5% to R26.9bn, dividend 500c (+45%).
• MTN Nigeria swung to profit: PAT R13.1bn vs R(6.8)bn FY2024; service revenue +54.9%CC, EBITDA margin +13.6pp to 52.7%*, customer deposits in MoMo +142.6% YoY; resumed dividend payments and restored positive retained earnings.
• IHS Africa tower acquisition announced 20 February 2026: MTN agreed to buy the ~75% of IHS Holdings' African operations it does not already own; pro forma financial effects published 12 May 2026; closing expected H2 2026 per the Q1 2026 trading update.
• Q1 2026 trading update (12 May 2026): service revenue +21.1% CC; EBITDA margin widened ~3pp to 47.6%; data revenue +36.1%, fintech +22.4%; subscribers 312.7m (+5.4%); MoMo MAU +8.2%; capex R9.6bn (16.4% intensity).
• Ambition 2030 strategy unveiled (28 August 2025 board announcement, full reveal at 10 June 2026 Capital Markets Day): three platforms (Connectivity / Fintech / Digital Infrastructure), revised segmentation, network-sharing partnerships in Nigeria and Uganda, AI-enabled data centres prioritised in South Africa and Nigeria, and a fully-fledged shareholder remuneration framework (40-60% of equity FCF, R6bn buyback authorisation).
• Fintech structural separations progressing: MTN Uganda shareholders approved separation of MoMo Uganda (July 2025); MTN Ghana shareholders approved the MobileMoney/MobileMoney Fintech merger (December 2025); Nigeria separation regulatory work continuing.
• MTN Ghana restated for IFRS 16 and Ghana ceased hyperinflationary accounting effective 1 July 2025 (three-year cumulative inflation back below 100%).

Risks And Watchpoints

• Africa FX volatility, especially the naira and rial: Nigeria's prior naira devaluations drove a R6.8bn loss in FY2024, and FY2025 results still booked R5m forex losses (vs R10.8bn in FY2024). Equity income from Iran's Irancell fell 41.2%* on a 45.4% weaker average rial — any reversal of recent currency stability would directly hit reported numbers.
• Hyperinflation accounting noise: Ghana left hyperinflationary status mid-2025, but Iran, Sudan and South Sudan remain hyperinflationary. The FY2024 restatement reduced reported equity by R1.1bn, and HEPS adjustments included 46c of hyperinflation drag — analysts must continually reconcile reported vs adjusted earnings.
• MTN South Africa prepaid weakness: SA service revenue grew only 2.0%, prepaid revenue fell 2.3% (-3.9% in Q4), and EBITDA was down 10.2% with margin off 2.9pp to 34.5%. SA is the deleveraging anchor for the group; if prepaid trends do not reverse, group margin and Holdco cash upstream could disappoint.
• IHS deal execution and regulatory risk: the IHS Africa acquisition needs antitrust and other approvals in multiple jurisdictions and meaningfully changes group capital intensity and consolidated leverage. Pro forma financial effects only published on 12 May 2026.
• Geopolitical exposure: operations in Sudan (active conflict), South Sudan and pan-African geopolitical tail risks. Management explicitly flagged Middle East/Ukraine escalation as a guidance risk in the FY2025 commentary.
• Fintech competition and pricing: management called out "increased competition and pricing disruptions" in fintech in 2025; sustaining 23%* growth and the 42.8% EBITDA margin against new entrants and regulators (e-levy reversals, USSD repricing, etc.) is not a given.

What To Verify Next

1. IHS Africa transaction structure and consideration: pull the 12 May 2026 pro forma financial effects circular to confirm purchase consideration, financing mix, pro forma net-debt/EBITDA and EFCF impact, and the closing timeline (management guides H2 2026).
2. Capital Markets Day (on or about 10 June 2026): detailed Ambition 2030 capital allocation, ROCE bridge to "high-20% to low-30%" target, leverage roadmap to "1.0x or lower" net debt/EBITDA, and buyback pacing within the R6bn three-year envelope.
3. MTN South Africa turnaround pace: track Q2 2026 trading update for prepaid revenue trajectory after February 2026 postpaid price adjustments; SA EBITDA margin needs to return to the 35-37% medium-term target range.
4. Fintech separation milestones: timing of Nigeria, Ghana and Uganda fintech structural separations and any partial monetisation/IPO signals — these could unlock a sum-of-parts story.
5. Q2 2026 / H1 2026 interim results (typically released mid-August): confirm Q1 2026 momentum (47.6% EBITDA margin, +21.1% CC service revenue) is sustained and watch for any reset to medium-term guidance — group service revenue "at least high-teens", Nigeria "at least low-20%", fintech "high-20s to low-30s".