MTN Nigeria Suffers ₦400 Billion Loss as Naira Devaluation Hits Hard

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MTN Nigeria Communications Plc has reported a significant financial downturn for the full year of 2024, recording a loss after tax of ₦400.4 billion. This marks a stark contrast to the ₦348.7 billion profit reported in 2022. The primary factor contributing to this loss is the substantial devaluation of the Nigerian naira, which has led to increased foreign exchange losses and elevated operational costs. 


Impact of Naira Devaluation


The devaluation of the naira has had a profound impact on MTN Nigeria’s financial health. In 2023, the company reported a net foreign exchange loss of ₦740.4 billion, a sharp increase from ₦81.8 billion in 2022. This trend continued into 2024, with the devaluation further eroding profits and contributing to the overall loss. 


Revenue Growth Amidst Challenges


Despite the financial losses, MTN Nigeria experienced a 35.9% growth in revenue, reaching ₦3.3 trillion in 2024. This indicates strong operational performance and a growing customer base. However, the gains from increased revenue were insufficient to offset the substantial foreign exchange losses incurred due to the naira’s devaluation. 


Market Response


The financial challenges have also affected MTN Nigeria’s stock performance. In January 2025, the company’s share price experienced a 9.87% increase following the approval of a long-pending proposal for telecom tariff hikes by the Nigerian Communication Commission (NCC). This development was seen as a positive move to bolster revenue streams amidst the economic challenges posed by currency devaluation. 


Looking Forward


MTN Nigeria’s financial trajectory underscores the significant impact of macroeconomic factors, particularly currency fluctuations, on multinational operations. The company may need to implement strategic measures to mitigate foreign exchange risks and adapt to the volatile economic environment. This could involve renegotiating local agreements, diversifying revenue streams, and exploring financial instruments to hedge against currency risks.


In conclusion, while MTN Nigeria continues to demonstrate robust operational capabilities and revenue growth, the adverse effects of the naira’s devaluation present substantial challenges. Addressing these financial headwinds will be crucial for the company’s sustained profitability and market stability in the coming years.


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