Net profit for Malawi’s pioneer mobile network services provider TNM plc grew by 19% in the first half of 2021, after two consecutive years of negative growth in profits during the same period. The company reported a drop of 29% and 3% in its first half profits in 2020 and 2019 respectively.
The growth of 2021 has been propelled by solid growth in revenue from Mpamba growing by 54% and internet business growing by 14%, the company’s published results for the first half of the year ending 30 June 2021, show.
The unaudited interim financial results reflect remarkable improvements in performance of non-traditional profit streams for TNM plc, which has historically relied on the voice (GSM) business segment for the bulk of its profitability and retained earnings.
Revenue from Mpamba grew significantly by 54% to over K5 billion while that for data was up 14% to K15.6 billion, show the half-year results.
The two business segments have combined efforts to help the TNM group’s total revenue grow by 8% from K42.2 billion in 2020 to K45.5 billion in 2021 during the same period of review.
“EBITDA margin increased to 38% (June 2020: 36%) due to cost containment initiatives that management continues to implement. Net profit after taxation increased by 19% to MK4, 511 million (June 2020: MK3, 780 million),” reads the financial results, co-signed by board chairman George Partridge and Chairman Board Audit Committee, Lekani Katandula.
Overall, the results show a business on its recovery path.
TNM anticipates the data business segment to continue growing strongly and is increasing its investment to support distribution systems and network expansion. TNM’s capital expenditure on distribution and network infrastructure has increased from K11.7 billion in 2020 to K14.8 billion 2021 during the same period. The investment in network operations has doubled in the two years from K7.3 billion in 2019 to K14.8 billion in 2021.
The telco, listed on the Malawi Stock Exchange (MSE) says during the first six months of the year, its customer base increased by 26% to 4.5 million, a strong recovery from the negative growth experienced in 2019, and higher than the 2% growth of 2020.
Despite the economic challenges posed by two years of an unrelenting Covid-19 pandemic, volatile exchange rates and foreign currency shortages, TNM remains optimistic that its business model will deliver more positive results.
“We will continue with our business model to minimize these impacts and continue to create value for our stakeholders,” reads the statement accompanying the 2021 half-year financial results.
