MTN sees strong data growth in Uganda

IOL pic NIGERIA-MTN-GROUP-_1117_11 REUTERS File picture: Afolabi Sotunde

Kampala - MTN Uganda, the country's largest telecoms firm, sees strong data sales helping 2016 revenue rise 7 to 10 percent and expects to seek a syndicated loan soon, its chief executive said on Tuesday.

The division of South Africa's MTN Group, Africa's largest mobile networks operator, has a subscriber base of 8.9 million, the biggest in Uganda and ahead of second place rival India's Bharti Airtel.

“The biggest reason for the (revenue) growth will be around our data,” MTN Uganda's chief executive officer, Brian Gouldie, told Reuters.

Voice still remains the main cash generator, accounting for about 56 percent of the 1.3 trillion shillings ($385.8 million) in revenue last year. But data is the fastest growing revenue stream, expanding 17 percent last year from 2014.

Mobile penetration in Uganda stands at about 44 percent, offering room for mobile providers to expand. But competition has eroded margins since 2010 and encouraged some players to sell. Bharti Airtel bought Warid Uganda in 2013 and, in 2014, French telecoms firm Orange sold its Uganda unit to Africell.

Read also: Thaw in MTN-Nigeria relations?

MTN Uganda has about 5.4 million data customers but only 9 percent of those are covered by 3G and 4G broadband networks. Gouldie said he aimed to boost that to 15 to 20 percent in 2016.

“As our 3G and 4G penetration grows, so will our mobile data and ICT (information and communications technology) revenue grow,” Gouldie said in an interview.

MTN has also been investing in internet infrastructure. It has laid 3,500 km of fibre optic cables so far and plans to add 400 km this year, he said.

He added the company aimed to secure a loan in the coming weeks to help to support its investment, although he did not give a value.

In 2009, MTN Uganda raised $100 million from a syndicated loan. “We'll probably do something very similar in order to again generate liquidity ... so that we do have enough cash for both investments and operations,” Gouldie said.


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