In a recent report by Business Insider Africa, MTN, the renowned African telecommunications powerhouse, is exploring the possibility of exiting operations in three African countries.
Currently operating in 19 countries across Africa and the Middle East, MTN is engaged in discussions about an “orderly exit” from Guinea-Bissau, Guinea-Conakry, and Liberia.
The strategic move aims to streamline its portfolio and concentrate its efforts on core markets.
Once executed, this will reduce the company’s operational footprint in its West and Central Africa (Weca) segment to just five countries.
While the specific reasons for the potential market exits have not been disclosed, MTN’s financial reports reveal that the company has been grappling with a range of challenges in the West and Central Africa region.
MTN’s CEO, Ralph Mupita, pointed to various factors, such as inflation and currency devaluation, affecting several markets in the region.
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In its 2022 financial year, MTN witnessed a decline in its EBITDA margin, which dropped by 1.7 percentage points year-on-year to 33.1%.
This decline was attributed to pricing pressures, fintech channel subsidies, and macroeconomic challenges, including local currency devaluations and higher inflation.
According to the report, these three countries—Guinea-Bissau, Guinea-Conakry, and Liberia—make up only a small fraction of MTN’s total revenue, contributing a mere 1.6% to the company’s earnings in 2022.
Moreover, MTN holds a secondary position in the telecommunications market share in these countries, with around 30% market share in Guinea-Bissau and Guinea-Conakry, and Lonestar MTN being the second-largest telecom provider in Liberia.