South African telecoms giant MTN has launched a R6 billion share buyback after reporting stronger first-half earnings, supported by growth in some of its largest African markets and rising demand for data and financial services.
Adjusted headline earnings per share rose 21.3% to 793 cents during the six months to June, while service revenue increased 17.5% on a constant-currency basis. Stronger cash generation gave the company room to return capital to shareholders while continuing to invest heavily in its networks.
The buyback, worth about $375 million, began after the results were announced and marks a significant move by one of Africa’s largest telecommunications groups. MTN serves 317.7 million customers across its operations, giving its financial performance wider significance for the continent’s rapidly changing digital economy.
Nigeria, Ghana, Uganda, Côte d’Ivoire and Cameroon were among the markets that helped drive growth during the period. Performance in South Africa was more subdued, with service revenue increasing 1.5% as MTN continued changes aimed at improving the quality of its prepaid customer base.
Nigeria remains particularly important to the group. Africa’s most populous country has previously presented MTN with difficult operating conditions, including currency weakness and high inflation, but its business there has recovered strongly as demand for mobile and data services continues to expand.
MTN Nigeria reported a 25.9% increase in service revenue during the first half, while Ghana recorded even faster growth. Their performance helped offset weaker currency translation when earnings from African markets were converted into South African rand.
Data is becoming increasingly central to the company’s business. MTN ended June with 179.3 million active data subscribers, an increase of 9.1%, while data traffic rose 22.8%.
That growth reflects a wider transformation taking place across African telecommunications. Mobile operators that once depended heavily on voice calls are increasingly building their businesses around internet access, digital platforms and financial services.
MTN’s fintech operations offer one of the clearest examples of that shift.
The group had 70.8 million active Mobile Money users at the end of the period. Those customers completed 13 billion fintech transactions worth about $330.5 billion during the first six months of the year.
Transaction value increased by more than a third on a constant-currency basis, showing the growing role mobile operators now play in Africa’s financial system.
Mobile money has become particularly important in markets where many consumers have limited access to conventional banking. Telecom companies have used their large customer networks to offer payments, transfers and other financial services directly through mobile phones.
That opportunity has also drawn increasing competition from banks and fintech companies. MTN is responding by expanding beyond basic transfers into more advanced financial services as it seeks a larger share of Africa’s digital payments market.
Strong demand has not reduced the need for investment in the underlying telecommunications network. MTN spent almost R20 billion on capital expenditure during the first half as it expanded mobile networks, connected more homes and modernised its technology systems.
The company must continue investing as smartphone adoption and data consumption increase across its markets. Reliable networks are becoming even more important as African economies adopt cloud services, digital payments and artificial intelligence applications that depend on stronger connectivity.
MTN’s improving financial position has allowed it to balance that investment with returns to shareholders. Equity free cash flow increased 32.7% during the period, while the group maintained relatively low leverage.
Not every part of the results was positive. Reported headline earnings per share fell 5.8% after MTN recognised a R3.9 billion non-cash impairment linked to its 49% interest in Irancell.
Iran remains one of the most complicated parts of MTN’s international portfolio. Sanctions and restrictions on moving money out of the country have limited the group’s ability to access cash from the business, while inflation and currency weakness have further affected its value.
MTN has been working towards an exit from the market as it concentrates more closely on its African operations.
That strategy leaves the company increasingly dependent on the growth of African connectivity, data and digital financial services. Its latest results suggest those markets are providing considerable momentum despite uneven economic conditions across the continent.
The R6 billion buyback is therefore more than a reward for shareholders. It reflects stronger cash generation from a business that is changing alongside the African consumers it serves.
Voice remains important, but the next stage of MTN’s growth is increasingly tied to what travels through its networks: data, digital payments and financial services.
With more than 317 million customers already connected to its platforms, MTN has considerable scale. Turning that reach into sustained earnings while continuing to invest in Africa’s digital infrastructure will determine whether the current recovery becomes a longer-term growth story.
