MTN Group Ltd has reducing its expenditure for the full year in an effort to preserve cash and maintain networks during the COVID-19 crisis.
Africa’s biggest wireless carrier by sales will invest $1.1 billion in 2020 instead of an earlier $1.5 billion, the Johannesburg-based company said in a statement. The company is working with a medium-term growth estimate and said that it is committed to an asset-disposal strategy that kicked off in 2019.
Worldwide, Telecoms have proved resilient to the COVID-19 crisis as most governments have enforced stay at home measures which have necessitated working and entertaining from home to contain the pandemic. MTN has reported a surge in data traffic in three of its biggest markets; South Africa, Ghana and Nigeria, since end of February.
Read: African Whatsapp? MTN Zambia, Simfy Africa Launch Instant Messaging App
MTN Shares declined 9.3 percent to 45.16 Rand. The stock has plummeted more than 40 percent this year, partly due to its exposure in Nigeria which has faced economic strife from weakened oil prices as well as the Coronavirus pandemic.
MTN first quarter sales had an 11 percent increase while the carrier gained an addition 6.6 million subscribers to reach 257.3 million. This is inclusive of a decline in the service revenue in the SA market occasioned by the loss of a roaming agreement between Telkom SA SOC Ltd and MTN. The company extended its license in Uganda, one of its market shares, to 2032 for about $100 million.
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