MTN Nigeria To Cut Down Dollar Spending To Reduce Naira Exposure

Nigeria's biggest telecommunication company, MTN Nigeria, is going to reduce its foreign exchange spending in Nigeria to reduce exposure to Nigeria's exchange-rate volatility.

This is because a recent decision by the Central Bank of Nigeria to devalue the naira by 7.6% against the dollar to 410.7 has had a major impact on the business.

MTN made this known in a statement on Friday but stated that “there are no substantial operating losses or significant deterioration in the value of assets used to generate cash flows.”

Nigeria is MTN's biggest market, and the company indicated in its statement that it has no intentions of restructuring or selling its Nigerian business. Instead, the mobile carrier plans to expand its network coverage to at least 1,000 rural communities this year and to 2,000 more in 2022.

“In the next three years, we will invest over N600 billion to expand broadband access across the country in support of government’s broadband plan,” MTN Nigeria Chief Executive Officer Karl Toriola said.

MTN had 68.9 million subscribers at the end of June, down 9.9% from 76.5 million at the end of last year due to regulatory restrictions on new registrations.

In the first half of the year, MTN’s Nigerian unit reported a profit of N141.8 billion ($345 million), 49% more than the same period of 2020. Revenue was N791.3 billion in the first half of this year, up 24% year-on-year.