MTN Nigeria posted a profit after tax of N133.7 billion in the first quarter of 2025, rebounding from a loss of N392.7bn in the same period last year.
The turnaround was driven by a surge in operating profit and a sharp decline in foreign exchange losses.
In its unaudited Q1 results released on Tuesday, the telecoms giant with now 81 million subscribers said the rebound came despite a 25.0 per cent increase in operating expenses, mainly due to the depreciation of the naira.
Lease-related costs, which accounted for over 60 per cent of total operating expenses, were significantly impacted.
The naira fell 72.2 per cent year-on-year against the U.S. dollar, from N897.8/$ in Q1 2024 to N1,546.1/$ in Q1 2025.
The company said renegotiated lease terms helped reduce exposure to currency volatility and capped inflation-linked escalations. In addition, VAT exemptions on energy components under the new Finance Act supported margin improvement.
“Overall, we reported a significant turnaround in our bottom line, with a profit after tax of N133.7 billion versus a loss of N392.7 billion in the prior year,” part of the report highlighted.
Earnings before interest, taxes, depreciation, and amortisation rose by 65.9 per cent, while the EBITDA margin expanded by 7.2 percentage points to 46.6 per cent, supported by lease renegotiations, VAT exemptions, and ongoing cost-efficiency measures.
Depreciation and amortisation increased by 22.1 per cent due to new lease additions. Net finance costs rose by 44.0 per cent, reflecting higher interest rates and elevated lease liabilities.
However, net foreign exchange losses fell sharply by 99.2 per cent to N5.5bn, aided by relative naira stability during the quarter.
MTN also began the phased implementation of a new tariff structure in mid-February 2025, with the majority of changes affecting its data and voice bundles taking effect in March.
While the full impact on usage and revenue is expected from Q2 2025, early indications suggest strong resilience in customer demand, aided by targeted CVM initiatives.
“We remain optimistic about our growth trajectory and the opportunities within our market,” MTN Nigeria CEO Karl Toriola stated in the report.
“Our strong performance in the first quarter underscores our ability to navigate a complex and evolving macroeconomic environment while remaining steadfast in executing our strategic priorities,” he noted.
He added, “We are encouraged by the improvements in Nigeria’s macroeconomic conditions, marked by increased forex liquidity, a relatively stable naira, and easing inflation. However, the recent escalation in global geopolitical and trade tensions presents risks to the broader outlook.”
Free cash flow stood at N209.9bn, down 54.8 per cent from the previous year, as MTN accelerated capital spending and faced a tough comparison to Q1 2024, when it benefited from currency-driven valuation effects.
The company’s retained losses narrowed to negative N474.1bn m from negative N607.5bn in December 2024.
Shareholders’ equity also improved, rising to negative N324.6bn from negative N458.0bn in the same period.
Data revenue climbed 51.5 per cent, driven by an expanding active user base and increased consumption.
Data traffic grew 46.4 per cent, while average usage per subscriber rose 29.5 per cent to 12.8GB. Smartphone penetration hit 60.7 per cent, with four million new smartphones added during the quarter, reflecting strong demand for high-speed data services.
MTN’s 4G coverage reached 82.7 per cent of the population, a 0.2 percentage point increase, while 5G coverage held steady at 12.7 per cent as the company prioritised capacity upgrades over new rollouts.