Audio By Carbonatix
Mobile operator MTN Group said on Monday that its board had approved a 6 billion rand ($375 million) share buyback programme, as it reported a 21.3% rise in half-year adjusted profit and strong cash generation.
CEO Ralph Mupita told journalists the buyback programme would begin on Monday.
At 1005 GMT, MTN shares were up 4.61% at 201 rand.
Africa's biggest telecom operator, with more than 317 million customers across 19 markets, said adjusted headline earnings per share (HEPS) rose to 793 cents in the six months ended June 30 from 654 cents a year earlier.
Reported HEPS, however, fell 5.8%, hit by a 3.9 billion rand non-cash impairment on its 49% stake in Irancell, reflecting Iran's hyperinflation and the sharp depreciation of the rial. Foreign exchange losses in South Sudan also weighed on earnings.
The impairment comes as MTN seeks to exit Iran, its last remaining operation in a broader withdrawal from the Middle East. The process has been complicated by U.S. sanctions, in place since May 2018, which have also prevented the company from repatriating about 880 million rand in trapped dividends, Mupita said.
"With the sanctions in place, we can't put any money in and we can't take any money out. But if the situation did change in a way where there was a removal of sanctions we would continue with executing our Middle East exit strategy," he added.
Outside Iran, MTN's biggest market, Nigeria, along with Ghana and Uganda, helped lift service revenue 17.5% to 115.3 billion rand. Growth in South Africa was 1.5%.
MTN said strong subscriber additions and growth in digital and fintech services also supported its performance.
Core earnings rose 24.4% to 56 billion rand, while the EBITDA margin widened 3.1 percentage points to 47.1%.
MTN said the remaining hurdles to its tower deal with IHS Towers are largely regulatory. It has received conditional approval from Nigeria's competition regulator, which requires it to reduce its stake in the Nigerian business by up to 30% over time at market prices.
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