MTN repositions to accelerate long-term growth

MTN is looking to reposition itself, accelerate growth and unlock the value of its infrastructure, assets, and platforms, through its new strategic plan dubbed ‘Ambition 2025’.

The new strategy will closely align with that of MTN Group and built on four key strategic priorities – building the largest and most valuable platforms, driving industry-leading connectivity operations, creating shared value, and accelerating portfolio transformation.

According to MTN Nigeria’s Chief Executive Officer, Olutokun Toriola, these priorities will define MTN’s focus for the next five years.

“Taking advantage of MTN’s existing platforms and assets, we are well-positioned to accelerate long-term growth as we continue to monitor and manage the impacts of the pandemic.

“We have a clear focus on sustaining double-digit service revenue growth ahead of inflation, driving 4G and rural network expansion, as well as positioning our fintech and digital businesses for accelerated growth to unlock their full value. In addition, we will continue to sustain our expense efficiency programme to strengthen our financial position and support margins.”

He also expressed that changes were being made within the organisation to meet the company’s target and optimise its operations, “We are driving a positive culture change across the organisation to enhance productivity and further improve performance. We maintain our strong focus on deeper, proactive, and inclusive engagements to drive shared value for all stakeholders while ensuring that our activities align with and contribute to the Government’s development agenda.’’

With reductions in finance costs, increased capital expenditure (CAPEX) and strategic selective partnership, MTN is well on its way to achieving Ambition 2025.

In a recent interview, the Chief Financial Officer, MTN Nigeria, Modupe Kadri, stated that one of the key elements of Ambition 2025 is emerging expansion, which the telecom giant has undertaken with its recent offer of N90 billion worth of bonds with 10 years’ maturity for sale to investors, after obtaining regulatory approval for the exercise.

The bond issuance which is to reinforce MTN Nigeria’s strategy of diversifying its funding sources will help in the expansion drive of its 2025 Ambition.

According to Kadri, the proceeds will be used to finance the existing debts and put into the network for critical network infrastructure to help with the network expansion.

“We are coming out of a pandemic, so interest rates are generally down. We have existing facilities with the banks which were based on floating rates. Naturally as the rates went down, so did finance costs. We took advantage of the low rate in the market to also establish a Commercial Paper (CP) Programme which was oversubscribed, and we decided to put this bond programme in place knowing fully well that the rates are not likely to remain at those levels. So, it is better to have a long-term view because our business is highly capital intensive and that means you have to try to match those returns to your annual outgoings. This is what we are trying to do with the structuring of the bond programme.”

One of MTN Nigeria’s strategies for creating shared values in alignment with its Ambition 2025, is its recently approved participation in the Road Infrastructure Tax Credit (RITC) Scheme in response to the government’s drive towards public-private partnerships in the rehabilitation of critical road infrastructure in Nigeria. The partnership will see to the rehabilitation of the Enugu/Onitsha Expressway.

Speaking on MTN’s motivation for participating in the project, Kadri said, “We constantly embrace opportunities to create shared values for both our stakeholders and the communities in which we live in.”

MTN’s strategy to drive industry-leading connectivity operation in line with its 2025 ambition is to be one of the early markets to roll out the 5G network in Nigeria. MTN is the first telco to demo 5G technology in Nigeria, hosting members of government, customers, and the tech community to sessions in Lagos, Abuja, and Calabar in 2019.

The 5G technology is designed to expand the scope of mobile technology beyond the capabilities of LTE. The technology will be transformative and is expected to fuel innovation across every industry and every aspect of life.

According to Kadri, “MTN was the first to pilot 5G technology to prove that we are technology ready. Once the environment and pricing are right and the numbers all stack up, we will proceed to advance 5G technology in Nigeria and support the government in its efforts at meeting its broadband targets.”

MTN has shown admirable focus on sustaining and accelerating growth in line with its Ambition 2025 strategy which is anchored on building the largest and most valuable platform business with a clear focus on Africa.

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