MTN has told shareholders that it expects a significant increase in earnings when it releases interim results this week.
The company said its earnings per share for the six months ended June 31, 2022 will rise 195-205% from R1.48 last year to R4.37-4.51.
Its total earnings per share will be between R5.42 and R5.81, up 40-50% from the R3.87 reported last June.
“Earnings per share includes impairment losses primarily attributable to goodwill totaling approximately 25 cents (2021: 73 cents), an impairment loss on revaluation of disposal groups of 52 cents (2021: 2 cents ) and the net loss from disposal of SA towers. or 45 cents (2021: 0 cents),” MTN said.
The company said its total earnings were negatively impacted by certain non-operating and non-recurring items worth around 94 cents (2021: 118 cents).
These include pre-impairment hyperinflation (2 cents), foreign exchange losses (88 cents) and IFRS 2 expenses arising from the MTN Ghana localization transaction (4 cents).
In mid-June, MTN informed shareholders that early stage discussions acquire the entire issued share capital of Telkom.
The company said it would buy Telkom in exchange for shares or a combination of cash and shares.
MTN shares surged on the news, jumping more than 7% on the day.
However, the company is still trading more than 19% lower YTDdown from R172 per share on January 3 to R139 at market close on Friday.
South Africa’s second-largest mobile network started the year well, with its share price breaking R200 in February 2022 for the first time in nearly seven years.
This was helped by a reduction in the debt of her holding company and strong performance in markets such as Nigeria, which benefited greatly from rising oil prices.
However, MTN’s success was undermined after the Nigerian Communications Commission announced in April that all mobile operators must restrict outgoing calls to subscribers with SIM cards not tied to a national identification number.