MTN Committed to Nigerian Investment

MTN Nigeria has reported a pre-tax earning of US$89.7 million on a revenue of US$568 million for the period April 1, 2002 to March 31, 2003. Had it not been for the depreciation of the Naira during the period reported, which resulted in a currency translation loss on the investment, net earnings would have been US$140 million.

According to Adrian Wood, the company's chief executive officer, "we are quite impressed with the results and will continue with our strategy of reinvesting every kobo realised as turnover or profit into the business to enable us achieve our roll out targets on schedule". The re-investment of all its earnings and profits into the business, Wood assured, is without prejudice to the original $1.4 billion investment plan.

The results, he added, "put us in a better position to negotiate additional long term financing from international financial institutions having clearly demonstrated a focused commitment to our business and social objectives".

The trajectory of the company's business, Wood said, would make a good case study for the impact of commercial operations on national development. "For instance in this same period, we have made payments in excess of US$90 million in the form of taxes, duties, licenses and similar payments to the government at different levels." The company's staff, Wood added also paid under the PAYE taxes on their salaries, US$4 million to the government during the period. Other payments, he added, included mast and site erection permits and sundry licensing fees. Such payments, he said, are a vital source of revenue for governments at various levels and facilitate the ability of government to discharge its obligations to society.

MTN, he pledged, "is also keen to remain a showpiece of responsible corporate intervention in the social well-being and development of its communities". He added that "whether in sponsoring relief efforts for bomb explosion victims or sponsoring the procurement of machines in hospitals or helping provide books and teaching aids for schools across Nigeria or sponsoring mass participation sports like the MTN Marathon or soccer, or even sponsoring the medical rehabilitation of a sculptor incapacitated by a road traffic accident, we want our interventions to impact positively on the lives of people". The company he stated, spent over N338m in various corporate social responsibility initiatives during the last financial year.

In the months to come, Wood added, the company would deploy significant additional resources to building additional network capacity, while an expansion of its services to the North East of Nigeria would be accorded priority. The company will also deploy US$60 million towards the construction of the second phase of Y'helloBahn, its microwave radio digital transmission backbone, which is expected to commence in July. The project is expected to traverse more than 16 states and significantly complement the first phase of Y'helloBahn which was built at a cost of US$120 million and commissioned last January.

MTN paid US$285m for one of four GSM licenses in Nigeria in January 2001. It plans to commit some US$1.4 billion into building mobile telecommunications infrastructure in Nigeria over the next few years and hopes to raise significant proportions of this sum from local and international lenders and as well as through shareholders' equity. So far, MTN has committed more than half of this planned investment.

The company has so far spread coverage to 42 cities, more than 100 smaller towns and villages and well over 700 communities in Nigeria. In addition, MTN now provides coverage on a growing number of roads and highways in the country. The company employs 1,100 Nigerians directly and has provided an estimated 20,000 new jobs indirectly for Nigerians working in partner enterprises and organisations."

Posted to the site on 24th June 2003