MTN returns to profit, surpasses 300m customer milestone

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JIMMY MOYAHA: We’re kicking off our results reflections today with the MTN Group. They released their full-year results for the year ended 31st December 2025 at 7:05 this morning, the group reporting double-digit growth in most metrics and the business having an exceptional year financially across all of its geographical areas.

We are going to be taking a look at this in a bit more detail with the chief financial officer at MTN, Tsholofelo Molefe, who joins me on the line to see what we make of this.

Tsholofelo, lovely having you on the show. Thanks so much for taking the time. Those 300 million customers across the MTN business – that is a milestone worth celebrating. How did the group reflect on the year that was?

TSHOLOFELO MOLEFE: Thank you very much for that and good evening to all listeners.

I think for us, as we look through the financial performance this year, we believe that it’s really a testament to the quality of our operational execution across the business, supported by the investments that we’ve been making into our networks and platforms over the years.

That is why, we believe, we’ve produced such results.

It has also been supported by a [more] stable macroeconomic environment. You’ll recall that in 2023/24 we had tough headwinds coming out of Nigeria in particular.

We’ve seen an improvement as well on the Ghana side. Across various of our markets in the Shia and Weka regions we’ve seen service revenue growing above inflation for both those markets and importantly at very healthy premiums to their respective blended inflation rates, even in those markets. Absolutely.

Group service revenue on a group consolidated basis is at 23% in constant currency, way above R200 billion, and Ebitda [earnings before interest, tax, depreciation and amortisation] growth of 36.8% in constant currency, really supported by our efforts over the last three years as well.

In terms of our cost discipline, our expense-efficiency programme, we’ve delivered R3.6 billion in this financial year. So we are very pleased with the set of results.

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We’ve done a lot of work in terms of cleaning the balance sheet. Our group consolidated net debt to Ebitda is now sitting at 0.3 times, and our holding company leverage is sitting at 1.3 times, which is below our medium-term target of 1.5 times.

And a very strong cash generation is supported by a very good underlying performance as well.

JIMMY MOYAHA: Tsholofelo, you touched on the performance of the likes of the Nigeria business, the Ghana business. I suppose the obvious question that sits here is the fact that MTN is one of the few telco operators, from a South African perspective – if not the only one – that operates in Iran.

We know you’ve been trying to exit the Iran market for quite some time, and the developments currently unfolding there must have you concerned.

What impact is this having, if any, on the business? How is that Iranian exit looking at the moment from a business perspective, and does MTN have any finances that are still locked in that market?

TSHOLOFELO MOLEFE: Yes, we don’t operate in Iran. It is an investment, an associate. Of course, we hold 49% of the shares.

We used to have three key people from an MTN perspective deployed there. They left the country – actually way before the current ongoing conflict.

I think what we said before is that, yes, because the central bank there is a sanctioned entity, we would not be wanting to upstream any cash from Iran.

So there is cash sitting there, which we will not be taking because we would like to comply with the sanctions and export-control clauses.

And secondly, yes, it is still, from a value perspective, a net-asset-value perspective, quite significant.

However, as we’ve seen with Syria in the past, even if you decide to abandon the business, you’re still the owner of the share and it could potentially come back from a legal perspective.

So obviously it’s staying there for a while, but if we had to leave we’d consider what options we have should things escalate in that environment. But we’re not managing it, as it is an investment, an associate.

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JIMMY MOYAHA: Tsholofelo, let’s take a look at the strategic decisions from a business perspective. You touched on some of the execution that has gone on over the last year. I want to look at where the business sits currently.

The liquidity from a business perspective is north of R40 billion but more important is the announcement that recently came out that the MTN business would be looking to buy IHS, the tower operator that you previously owned at some stage.

Take us through the strategic thinking behind that from a business perspective. Obviously a business the size of the MTN Group has the optionality to be able to look at strategic assets but also needs to think about it from a careful planning perspective.

TSHOLOFELO MOLEFE: Thank you. Two things that we’ve said there – I think if you look back to many years [ago] when we sold our towers to third parties, we believe that it was conducive at the time to do so in terms of what the market was like.

I think what we’ve learned post the sale is that obviously through tough environments such as the one we’ve had in Nigeria – the power challenges – there is some level of control one would want to have. So those are some of the lessons.

But I think IHS also had a change in strategy which really triggered opportunistically for us to say it is probably the right time for us to take these assets in and be able to take control of how we manage it so that we can be as efficient as we would like we would like to be.

Read: MTN launches R35bn IHS Towers full takeover

Of course the deal is not closed yet. Where we are is that we have signed the major agreements, and there will be some shareholder approvals on their side that need to be concluded.

We are hoping to close the deal in the next few months and, once we do that, we’ll be able to share more detail around how.

But it will be housed as a separate legal entity independently within the digital infrastructure business where we have our Bayobab, which is more our fibre infrastructure business.

We’re looking, as part of our Ambition 2030 strategy, at how we can tap into the datacentre – a strategy as well. So we’re looking at that from a digital infrastructure perspective overall, including the tower assets in there. So that’s how we think about it for the future.

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JIMMY MOYAHA: Tsholofelo, before I let you go, Iet’s look at that liquidity number and that headroom that it has afforded the business, the business swinging back into profit, which is very important to be able to, as you said, maintain a strong balance sheet, clean up the balance sheet where it needs to be [done].

What does that mean then going into the new financial year from a business perspective? How does that influence some of the capex deployments and the strategic allocations going into the new year?

TSHOLOFELO MOLEFE: Our business is still growing so we obviously invest in networks and platforms – IT systems as well – because we continue to see structurally high demand for our services, in particular data and financial services.

So it is important that we continue to enable the growth while we also give returns to shareholders.

You will notice that we have now introduced an enhanced shareholder return over the medium term.

We talk about a 40-60% free cash flow distribution to our shareholders, which includes a buyback programme that we will look into opportunistically.

We have said to our shareholders that we commit to a minimum of 40% of free cash flow in equity, free cash flow in dividend. And should we need to do a buyback, we will look at the additional 20% that would take us to the 60% maximum – of course depending on the predetermined criteria.

Should we not need to do a buyback, we will obviously look to return the cash to shareholders or even degear the balance sheet further.

As you know, with the IHS transaction we will obviously be raising additional debt at the holding company level.

JIMMY MOYAHA: MTN Group is well on its way to its Ambition 2030 strategy objectives and ensuring that along the way it is able to look after both shareholders and its more than 307 million customers across 16 markets.

We’ll leave the conversation on that note. Thanks so much to Tsholofelo Molefe, the chief financial officer at MTN Group, who joined us to look at the performance over the past financial year.

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