According to a statement released by a Johannesburg-based company, it was reported that MTN’s customer base has dwindled by 1.4 per cent to about 229 million across 22 countries in the three months through March, compared with the previous quarter.
“In order to mitigate any future regulatory challenges, the group took an exceptionally conservative stance by disconnecting all subscribers who could possibly be deemed to be non-compliant,” Bloomberg quoted its Executive Chairman, Phuthuma Nhleko to have said in the statement.
Last year, MTN was fined $5.2 billion in Nigeria for missing a deadline to disconnect subscribers, whom the government had believed to not have registered amid a crackdown on security. Although the comapny is yet to meet up with the deadline, the penalty has been reduced to $3.9 billion.
Contained in the statement is a report which states that the shares declined as much as 2.7 per cent before moving back to trade 2.2 percent higher at 151.11 rand by 9:29 a.m. The stock has lost about 21 percent of its value since the Nigeria penalty was announced in October.
“We expected a drop in subscribers in Nigeria during the first quarter, even though the drop was bigger than expected,” Arqaam Capital analyst Tibor Bokor said by phone from Dubai. “We expect that numbers in Nigeria will improve during the second quarter, as the political landscape has changed in the country.”
MTN Nigeria subscribers dwindled by 6.9 percent after 4.5 million customers were disconnected in February. In South Africa, the company’s second-largest market, customer numbers fell by 1.7 percent.