MTC’s revenue grows to N$ 2.6 billion
Mobile telecommunications operator, MTC, this week declared revenue growth of 4.62% amounting to N$ 2.6 billion in 2019, compared to $2.4 billion in 2018.
The company, which provides digital access to over 97% of the Namibian population recorded 9.6% in net profit since 2014, under the period under review. MTC generated a total of N$1.3 billion in cash from operations before working capital movements of N$11 million net interest earned of N$69 million, N$311 million tax paid, with N$581 million free cash flow before financing activities. During 2019, MTC recorded N$797 million net profit after tax.
Earnings before interest, taxes, depreciation, and amortization however, decreased with 10.1% primarily due to the adoption of the new international financial reporting standards, which changed the way MTC now reports for post-paid subscription revenue, subscription fees, bundled services and additional cost of sales expenses for amounts previously recognized as right of use assets.
This resulted in a reduction in revenue recognized upfront, an increase in the cost of sales upfront and a consequent reduction in gross profit and net profit after tax. Despite this, the Company remained financially sound with no gearing and cash generative, stable earnings and strong shareholder returns during 2019.
Return on Equity for the 2019 financial year was 34.5% compared to the previous year of 41.6% mainly contributed as a result in shareholders equity value. Dividends declared in 2019 was N$413 million compared to the previous years’ dividends of N$374 million.
Speaking at a press launch for the financial results, MTC’s CEO Dr Licky Erastus assured customers that the company will continue investing in the latest technologies that will make their lives easier.
“We have and will continue to share our financial results publicly in the interest of transparency so that we account to the you our most valued customers what we have done with your money,” said Dr Erastus, adding that this integrated report is MTC’s primary communication that explains who we are, how we create value and interact with our stakeholders.
Dr Erastus also highlighted that declining demand for voice and SMS has reduced the pace of growth as a traditional revenue stream and the rapid growth of data usage, driven by social media, streaming services, gaming and value-added services such as fibre and cloud offer new but competitive opportunities.