Africa’s largest telecom service provider, MTN, has said its Nigerian subsidiary is expected to make a profit of 190 billion naira ($955 million) in its 2015 FY profit after tax is within the company’s current estimates.
MTN Nigeria is currently facing fines of $3.9 billion, issued by the Nigerian Communication Commission, for failing to disconnect users of unregistered Sim cards. It is noteworthy, to state that MTN has filed a law suit to counteract NCC’s fine. A lot tension and steam have been blown off on the fine issue, although, “Yello!” network users are currently paying for this, as the network users are queuing up to update their sim registration details or re-register.
Furthermore, MTN’s Share value went up by 0.8 percent at 121.50 rand in the JSE Top-40 index. This is without doubt a good news for Africa’s biggest telecom company.
If MTN loses their court case against the NCC, they will be paying the imposed fine, through their nose, literally. As the fine equates to more than twice the company’s annual average capital spending over the past five years, you get the picture. There have been reports that MTN was trying to move their financial deposits in Nigerian banks, this move was foiled by NCC through a court injunction.
Currently, there are no indications that MTN will take any other steps to protest against and avoid the imposed fine. Closing operation is certainly not an option for them, given the company’s recent purchase of Visafone, and also the fact that Nigeria accounts for about 37% of their profit. Hopefully, the court case will be settled amicably.