Slim revenues knock MTN share price

The cellphone network said in an update before its annual general meeting yesterday that subscribers had grown 5% to more than 150-million in 21 countries.

The company said at the meeting that a board for its international operations would not be appointed "at this point in time".

In December, the company said it was in the process of setting up a board structure for MTN International, and that former CEO Phuthuma Nhleko had accepted an invitation to be non-executive chairman. The subsidiary would have had its own CEO, forming what was seen as two centres of power. There was also speculation that the company would be listed offshore.

CEO Sifiso Dabengwa said the MTN Group 's board had decided that setting up a board for the international operations "will not be progressed at this point in time. This follows a review of the work completed by the subcommittee of the board appointed to investigate the matter."

Its not clear when the issue will be revisited. Khulekani Dlamini, a portfolio manager at Afena Capital, said having two separate businesses did not make sense.

"It's one of those things that you do if there is nothing to acquire, and you are looking to unlock value for shareholders."

MTN said it had more than 150-million subscribers as it continued to grow in developing markets. It added 7,4-million subscribers, a growth of 5%, in the four months to April.

But revenue for the four months was only marginally higher because of the stronger rand. The rand averaged R6,86/$ in the period, compared with R7,48 a year earlier.

Total revenue was still driven primarily by voice revenue.

Source: Business Day