Shares of MTN Nigeria tumbled to their lowest level in over two years after the company reported its biggest annual loss in at least three years, fuelled by devaluations of the naira.
MTN shares dropped 7.82 percent to N185 per share on Monday, the lowest since December 30, 2021, when they sold for N182.
The naira crisis, which stems from a scarcity of dollars, has battered businesses and led to the exit of international businesses that need to repatriate earnings. It has also caused the worst cost-of-living crisis in the country in decades.
The naira has plunged from about 464 to 1600 a dollar since June last year after the central bank eased controls and allowed the currency to trade freely. The currency closed Monday at 1534.19 on the official window.
In its full-year report released last week, MTN Nigeria reported N740 billion in net foreign exchange loss and a net loss of N137 billion in 2023. A year earlier, the company’s profit was N349 billion.
“2023 witnessed a very challenging operating environment characterised by rising inflation, currency devaluation and foreign exchange shortages, complicated by geopolitical disruptions and cash shortages in Q1 arising from a redesign of the naira,” CEO Karl Toriola said in a statement.
“These factors created severe headwinds for our customers and our business during the year.”
Increased data traffic
The South Africa-based telecommunications firm has about 77 million customers in Nigeria, where it makes one-third of revenue.
Despite the naira’s impact, the company managed to increase data traffic by 45%, MTN said in the statement.
Mobile-money transaction volumes jumped 49%, and the company maintained strong free-cash-flow generation, demonstrating the underlying strength of the business, according to its filing.
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