MTN Rwanda swings back to profits but shareholders to wait longer for dividend payout

Listed telecommunications firm MTN Rwanda has reported a strong set of profits in the first quarter of 2025, signaling a promising outlook for the rest of the year. In an exclusive interview with Dunstan Ayodele Stober, CFO at MTN Rwanda, the company's success was attributed to strategic initiatives focused on data business and fintech offerings. Stober expressed satisfaction with the progress made, especially considering the challenging period in 2024 when the company faced significant losses. By the end of the year, MTN Rwanda managed to turn its fortunes around, ending 2024 on a profitable note and continuing the positive momentum into Q1 2025. One of the key drivers of growth for MTN Rwanda has been its focus on commercial execution. Stober highlighted the importance of distribution networks, network quality, and affordability in driving the company's top-line growth. Despite facing regulatory challenges that impacted gross additions in 2024, MTN Rwanda ramped up its distribution channels and introduced attractive value propositions like Guam, which resonated well with customers and contributed to a 12.3% increase in service revenue in Q1. The company also managed to contain costs and improve gross margins, resulting in an impressive underlying EBITDA of over 44% year-on-year. In terms of revenue growth, MTN Rwanda saw mobile money and fintech services emerge as star performers, with a 28% increase in mobile money revenue and a 22% growth in data revenue year-on-year. The company's innovative services and focus on network quality have been instrumental in driving growth in these areas. While voice services faced challenges, MTN Rwanda is optimistic about the potential for growth in this segment as well. Looking ahead, Stober emphasized the importance of prudent investment and cost management amidst market volatility and currency challenges. The company aims to strategically invest in network quality and data capacity to enhance customer experience and product offerings. By focusing on profitability, cash generation, and shareholder value, MTN Rwanda is committed to delivering sustained growth and meeting guidance targets of low double-digit revenue growth, significant fintech expansion, and EBITDA margins between 40-42%. When discussing MTN Rwanda's performance relative to other subsidiaries within the group, Stober highlighted the company's leading position in fintech services, showcasing impressive penetration and growth metrics. Despite the market size limitations, MTN Rwanda's fintech business has stood out within the group, earning recognition for its performance. In conclusion, while the question of dividend payouts remains uncertain, MTN Rwanda's primary focus remains on driving profitability, delivering value to shareholders, and steadily progressing towards achieving its set guidance targets. With a mix of cautious optimism and confidence in the company's trajectory, MTN Rwanda is poised for continued success in Q2 and beyond.