MTN Group Limited
Integrated Report for the year ended 31 December 2023
Leading digital solutions for Africa's progress
Welcome to our 2023 Integrated Report
Our purpose is to enable the benefits of a modern connected life for everyone
Inside this report
01 | All about MTN | |
02 | Our reporting suite | |
03 | Navigating this report | |
04 | About this report | |
06 | Who we are and where we come from | |
08 | Where we are going | |
09 | Where we operate and how we performed | |
10 | Views from our Chairman | |
12 | Q&A with the President and CEO | |
15 | Our market context | |
18 | Investment case - a compelling African growth story | |
19 | Creating and preserving value through our business model | |
21 | Our outlook |
02 | How we create value | |
22 | Material matters impacting value creation | |
34 | Social, Ethics and Sustainability Committee Chair's review | |
35 | Stakeholders with whom we partner to create value | |
46 | Risk Management and Compliance Committee Chair's review | |
47 | How we manage risk | |
49 | Top risks to value creation |
03 | Strategic and financial review | |
58 | Q&A with the CFO | |
61 | Key financial tables | |
63 | Operational performance summary | |
68 | Audit Committee Chair's review | |
69 | Finance and Investment Committee Chair's review | |
70 | Our Ambition 2025 strategy | |
71 | Our strategic performance dashboard | |
72 | Our strategic performance | |
73 | Build the largest and most valuable platforms | |
80 | Drive industry-leading connectivity operations | |
86 | Create shared value | |
88 | Accelerate portfolio transformation | |
04 | Governance and remuneration | |
89 | Directors Affairs and Governance Committee Chair's review | |
90 | Governance in support of value creation | |
92 | Our Board of Directors |
- How the Board transformed our values into actions
- Our Executive Committee
- Remuneration Report
- Independent assurance practitioner's limited assurance report
- Glossary
- Administration
Integrated Report 2023 01
All about MTN | + | Strategic and financial review | Governance and remuneration |
How we create value |
Our reporting suite
Our Integrated Report is supplemented by a number of reports that provide a comprehensive view of MTN's performance and prospects covering financial, risk management and environmental, social and governance (ESG) aspects. These reports go beyond traditional financial reporting by integrating sustainability and non-financial information.
Integrated Report | Financial reporting |
Our primary communication to stakeholders aims to help them make informed assessments of our performance and prospects, strategic direction and the value we create through our activities. It provides a forward looking perspective on MTN's financial and non-financial performance, encompassing strategy, risks and opportunities, targets and governance.
Sustainability reporting
The following suite of reports provides information on MTN's strategy and performance related to sustainability issues with potential impact on our organisation, society and the environment. The reports detail MTN's environmental and social policies, governance, strategies, risks and opportunities. The reports also provide detailed performance data on a wide range of ESG metrics and targets. MTN's sustainability disclosures are structured and informed by the voluntary Global Reporting Initiative (GRI) Standards (2021) and the International Financial Reporting Standards (IFRS) Sustainability Disclosure Standards (IFRS S1 and IFRS S2), which have fully integrated the Task Force on Climate-Related Financial Disclosures (TCFD) guidance. The reports detail MTN's policies, governance strategies, risks and opportunities relating to sustainability considerations.
These reports include an analysis of the Group's financial results, a five-year review, and MTN's approach to handling uncertain tax positions. They provide insight for current and prospective investors, employees, creditors, analysts and other stakeholders. They disclose details of MTN's income statement, financial position, cash flows, performance per share, as well as key non-financial information.
AFR
Annual Financial | Annual Financial | Tax Report | Five-Year Review |
Results | Statements |
Information for shareholders
CR | |||
Sustainability Report | ESG Data Booklet | Transparency Report | Climate Report |
Regulatory and reporting frameworks used:†
Companies | B-BBEE | |
Act | Act | |
Amended | IR | |
Financial | ESG Matrix | |
Sector Code | INTEGRATED | for Mobile |
(FSC) | REPORTING |
The Notice of AGM and form of proxy give information to shareholders who want to participate in the Group's Annual General Meeting (AGM).
Notice of AGM | King IV Assessment Report |
This provides a summary of the application of the King IVTM principles by MTN Group Limited and Mobile Telephone Networks Holdings Limited.
- For more details see page 05.
Integrated Report 2023 02
All about MTN | + | Strategic and financial review | Governance and remuneration |
How we create value |
Navigating this report
Throughout our Integrated Report, the icons below illustrate the connectivity between our Ambition 2025 strategic priorities, the capitals, material | |||||||||
matters, risks and value creation for our stakeholders. | |||||||||
Material matters | The capitals | Top risks | Our material | Ambition 2025 strategic priorities to create value | |||||
stakeholders | |||||||||
Geopolitical and | R | Challenging political | |||||||
1 | 1 | ||||||||
macroeconomic | and macroeconomic | ||||||||
conditions | conditions | ||||||||
Complex regulatory | Natural | R | Increased | ||||||
2 | 2 | Government | |||||||
regulatory | Build the largest | Drive industry- | Create shared | Accelerate portfolio | |||||
and tax environment | |||||||||
pressure | |||||||||
and most valuable | leading connectivity | value | transformation | ||||||
R | Cyber and | platforms | operations | ||||||
Network and | |||||||||
3 | 3 | ||||||||
information | |||||||||
platform performance | |||||||||
Financial | security risks | For more detail on our strategic priorities see page 70 | |||||||
Regulators and | |||||||||
R | |||||||||
Financial | Increased tax-related | policymakers | |||||||
4 | 4 | ||||||||
resilience | uncertainty | ESG remains at the core of our strategy. This aligns with our work to advance | |||||||
R | the United Nations Sustainable Development Goals (UNSDGs) through | ||||||||
5 | De-layering of the | Intellectual | Strategy | our business activities and our support of governments, communities and | |||||
telecoms business | 5 | customers. The SDGs target a sustainable society with a plan to end poverty, | |||||||
and execution | Civil society | ||||||||
model | protect the planet and ensure equality for all by 2030. We are committed | ||||||||
R | to bridging the digital divide, furthering financial inclusion to advance the | ||||||||
6 | Greater focus | 6 | Supply chain | attainment of the goals. | |||||
on ESG | |||||||||
Human | R | Investment | Our primary UNSDG contribution areas for shared value creation: | ||||||
Future-fit skills | Liquidity | ||||||||
7 | 7 | community | |||||||
and culture | and funding | ||||||||
Cybersecurity | R | ||||||||
8 | Manufactured | 8 | Compliance | Key indirect opportunities exist in the following SDGs: | |||||
and digital safety | |||||||||
Subscribers/ | |||||||||
R | Network and | customers | |||||||
Governance, ethics | |||||||||
9 | 9 | ||||||||
spectrum cost | |||||||||
and risk management | |||||||||
and availability | |||||||||
Social | R | ||||||||
10 | Artificial intelligence | We provide details | 10 | ESG issues | MTNers | ||||
on how the capitals | |||||||||
We unpack our material | enable our strategy on | We unpack our top risks | Our stakeholder | ||||||
page 19 (definitions | |||||||||
engagement report | |||||||||
matters on page 22 | on page 144) | on page 49 | |||||||
is on page 35 | |||||||||
Throughout this report we use the * symbol: | Other icons: | ||
* Constant currency after taking into account pro forma adjustments. These are the | |||
LA Limited assurance obtained | |||
responsibility of the directors and have been reviewed by our external auditor. | www.mtn.com | International Sustainability Standards Board |
Integrated Report 2023 03
All about MTN | + | Strategic and financial review | Governance and remuneration |
How we create value |
About this report
This Integrated Report is MTN Group Limited's primary communication to all stakeholders and provides a comprehensive yet concise view of the Group.
It endeavours to enable readers to make an informed assessment of our performance, prospects and the value we seek to create and preserve through our activities.
Reporting boundary for this report (risks and opportunities, outcomes)
The structure of this report, dated 29 April 2024, draws on the Integrated Reporting Framework. The 2022 Integrated Report was published on 26 April 2023.
Certain information presented in this report, including constant currency financial information, constitutes pro forma financial information. Certain non-financial information has been assured by Ernst & Young and is identified by LA . The Limited Assurance Report is on page 146.
Supplementary information is on our website in associated reports, the icons of which are on page 02.
Changes in reporting and enhancements
For this report, we made the following enhancements:
- Additional context on our enhanced materiality determination process.
- Further detail on our performance against the constituents of our strategic priorities.
- More granular background of specific market context information on our three regions.
- Our milestones over the last 30 years.
- Streamlined the duplication and enhanced cross referencing throughout the reports, including embedding hyperlinks to the website.
- Provided more information on how the Board transformed our refreshed values into action.
Basis for preparation
Our report reflects integrated thinking at MTN: it is prepared by the Investor Relations team, reporting to the MTN Group Chief Financial Officer. In determining its content, we assess the annual business plan, Ambition 2025, the issues that materially impact our ability to create and preserve value, as well as those that could erode value.
We also draw on monthly standardised reports prepared by management across the Group and submitted to the Board of Directors. These comprehensive updates include details of our operating context, our strategic performance, our stakeholder
engagements, as well as risks and opportunities. The is reviewed by the Executive Committee and then presented to the Audit Committee for review, before being recommended to the Board of Directors.
In line with our commitment to comprehensive, reliable and transparent reporting, the process we follow in the preparation of our IR is robust - and encompasses numerous checks and balances, in consultation with our Board, our senior management, our sponsors and our auditors. We also obtain limited assurance on selected non-financial data.
Financial reporting entity (control and significant influence)
MTN Group Limited
Subsidiaries | Joint ventures | Other investments | ||
(see our portfolio, page 09)
Stakeholders (see page 35)
Scope and boundary
The material matters and our Ambition 2025 strategy form the anchor of the report, which explains who we are and where we operate, the context in which we work, our governance and business model, our strategy and investment case, our risks and opportunities, as well as our operational and financial performance for the period 1 January to 31 December 2023. Financial data from our subsidiaries and non-financial data from subsidiaries, associates, and joint ventures are fully consolidated.
The report gives commentary, performance and prospects for our material subsidiaries: MTN South Africa and MTN Nigeria, as well as for our three operating regions:
- SEA - Southern and East Africa.
- WECA - West and Central Africa.
- MENA - Middle East and North Africa.
Details of listed operating companies (Opcos) MTN Nigeria, MTN Ghana, MTN Uganda and MTN Rwanda are in their separate integrated reports online . The reports for MTN Nigeria and MTN Ghana have been released. MTN Uganda's report will be published before end-April 2024, and MTN Rwanda's is due for release by end-May 2024.
We consider the outlook over three time horizons:
- The short term (less than three years).
- The medium term (three to five years).
- The long term (beyond five years).
Materiality
Material matters are those factors that could substantially affect the delivery of our strategy, our profitability and our sustainability and therefore influence our ability to create and sustain value for our stakeholders. Informed by recent developments in global disclosure standards and frameworks, we have adopted 'double materiality' across our suite of annual reports.
Material matters which meet the criteria for double materiality are those that fall within the impact materiality and financial materiality. These matters are likely to influence the value, timing and certainty of MTN's future cash flows across the short, medium
and long term. Our also unpacks financially material impacts resulting from ESG risks and opportunities.
- Impact materiality: refers to significant impacts on individuals, society and the environment.
- Financial materiality: captures the impacts on the Group's value and cash flow, including events during the financial year and those that are integrated into prospective cash flow projections.
We have sought to ensure that all the information in
this will help readers assess MTN's value creation.
The outcomes of our 2023 materiality determination process are on page 23.
Integrated Report 2023 04
All about MTN | + | Strategic and financial review | Governance and remuneration |
How we create value |
About this report continued
We report with reference to the following standards and frameworks
The Integrated Reporting Framework
Companies Act, No 71 of 2008 (as amended)
JSE Listings Requirements
FTSE/JSE Responsible Investment Index
King IV™^ Principles
International Financial Reporting Standards (IFRS)
UN GRI
JSE Sustainability Disclosure Guidance
Global System for Mobile Communications
Association (GSMA) ESG Metrics
Sustainability Accounting Standards Board (SASB) Telecommunication Services industry
UNSDGs
UN Global Compact (UNGC)
UN Guiding Principles on Business and
Human Rights
CDP
IFRS® Sustainability Disclosure Standard
IFRS® Climate-related Disclosures
Mcebisi Jonas | Khotso Mokhele | Ralph Mupita | Tsholofelo Molefe |
Chairman | Lead independent director | Group President and CEO | Group CFO |
Noluthando Gosa | Shaygan Kheradpir | Sindi Mabaso-Koyana | Stan Miller |
- Copyright and trademarks are owned by the Institute of Directors South Africa NPC and all of its rights are reserved.
Controls and combined assurance
The Board ensures an effective control environment which supports the
integrity of our information. We use a combined assurance model which | ||||
considers the role of management, control functions, internal and external | ||||
audit, and Board committees. For 2023, we assessed our controls to be | ||||
adequate and effective. | Nosipho Molope | Nicky Newton-King | Tim Pennington | Vincent Rague |
Approval by the Board
MTN's Board acknowledges its responsibility to ensure the integrity of the . We, as the Board, believe that this report has been prepared in accordance with the Integrated Reporting Framework. We are of the opinion that it addresses all material matters and offers a balanced view of MTN's strategy and how it relates to the organisation's ability to create and preserve value in the short, medium and long term, as well as how it relates to efforts to prevent instances where value is eroded. The report adequately addresses the use of, and effects on, the capitals and the way
the availability of capitals is impacting MTN's strategic positioning.
Approval date: 29 April 2024 | Lamido Sanusi | Nkululeko Sowazi |
Integrated Report 2023 05
All about MTN | + | Strategic and financial review | Governance and remuneration |
How we create value |
Who we are and where we come from
30 years
of value creation
1994
After securing one of South Africa's two 'national cellular radio telephony service' licences in September 1993, MTN began building a network in January, eight months after the state-owned competitor. Within six months the two were on par. Launched commercial operations on 1 June.
1995 | 1996 | ||||
Coverage race with | Launched prepaid solution | ||||
competitor intensified, | 'Pay As You Go' in October, | ||||
with MTN committing | dramatically opening up the | ||||
R1.2bn in capital | market. With no contracts and | ||||
expenditure. | no credit checks, even those | ||||
without bank accounts could | |||||
now have cellphones. | |||||
Offered SMS (a text message | |||||
of 160 characters) for the first | |||||
time. | |||||
1997
Began our international expansion.
Introduced SIM-only packages.
1998
Created MTN International in February.
Acquired licences in Uganda, Rwanda and Swaziland, HM King Mswati III making the first cellular call in the kingdom, on his birthday.
Became the first cellular network in Africa to get ISO 14001 rating for environmental management and ISO 9002 for customer service.
1999
Reached 2m subscriber mark in South Africa.
Network quality tests confirmed that MTN was best in SA.
2000
Launched the 'Call Me' concept and 'MyChoice TopUp'.
Acquired Camtel Mobile in Cameroon, rebranding it MTN Cameroon.
Became first in Africa to launch High Speed Circuit Switched Data technology (allowing data transfer at up to six times the normal rate).
2001
Won a licence in January in Nigeria, which at the time had just 700 000 fixed and 22 500 cellular lines for its 120m people. Launched commercial services in August.
Launched MTN SA Foundation to manage social investment projects. Foundation inaugurated by former President Nelson Mandela.
2003
Group subscribers topped 7m - a 42% year-on-year increase.
Reached 1m active subscribers in Nigeria.
Launched MTN special greeting Y'ello
2004
Revenue of R29bn
- a 21% increase.
MTN International contribution to turnover topped 35% (from 18.9% in 2002).
2005
Bought 49% of Irancell.
Bought 44% of Mascom in Botswana.
Acquired licence in
Côte d'Ivoire.
Bought 100% of Libertis in
Congo-Brazzaville.
Completed purchase of Telecel in Zambia.
Became one of first operators in Africa to offer 3G.
2006
Shareholders approved purchase of Dubai-based Investcom in US$5.5bn deal, expanding MTN's presence across Africa and the Middle East to 21 countries from 11.
Pledged US$65m for 2010 FIFA World Cup, making MTN the only African global sponsor.
Launched employee volunteer programme 21 days of Y'ello Care.
2002
Changed name to MTN Group Ltd from M-Cell Ltd
Became the first operator in Africa to offer General Packet Radio Services (GPRS).
MTN Nigeria subscribers hit
500 000 in the year after launch.
2007
Revenue up 42% to
R73bn.
Subscriber
numbers
topped 54m.
Integrated Report 2023 06
All about MTN | + | Strategic and financial review | Governance and remuneration |
How we create value |
Who we are and where we come from continued
2008 2009
2010
2011
2012
2013
Subscriber base reached 91m, up 48% from the previous year.
Revenue rose 40% to R102bn.
Subscribers topped 116m, grew market share in all but one of 21 operations.
Launched MTN
Mobile Money in Ghana and Côte d'Ivoire.
2010 FIFA World Cup in
South Africa.
At R8.1bn, MTN Zakhele transaction was the biggest broad-based black economic empowerment (B-BBEE) deal in SA telecoms.
Reached 164m subscribers.
Established Group Social and Ethics Committee.
Civil unrest in several markets and difficulties in repatriating cash.
The launch of the US$650m West Africa Cable System, increasing broadband capacity. MTN was its biggest investor.
Unveiled a new vision:
To lead the delivery of a bold new Digital World.
MTN Nigeria disconnected 3.2m as part of subscriber registration process.
R30bn capital expenditure (capex) included 4 400 3G sites and 5 161 2G sites.
2014
Voted the most
valuable and most
admired brand in Africa, for the first time.
Mobile Money (MoMo) subscribers up 50%.
2015
The Nigerian Communications Commission (NCC) imposed US$5.2bn fine on MTN Nigeria for not meeting the deadline to disconnect unregistered SIMs; 6.7m disconnections in Nigeria.
MTN Nigeria acquired 4G spectrum.
2016
Negotiated down to
US$1bn the MTN Nigeria fine for not disconnecting SIMs by deadline.
In Nigeria, MTN was classified as a "dominant operator".
2017
Launched BRIGHT strategy.
- Best customer experience
- Returns and efficiency focus
- Ignite commercial performance
- Growth through data and digital • Hearts and minds
- Technology excellence
Articulated our belief that everyone deserves the benefits of a modern connected life.
2018
Listed MTN Ghana.
Greater focus on fintech and digital
opportunities.
Launched CHASE framework to boost lower-income rural access to the internet.
2019
Listed MTN Nigeria.
Recorded US$96bn in mobile financial transactions - 9 200 per minute
Launched in 12 markets
2020
COVID-19 - MTN reported 10 staff deaths and launched the global staff emergency fund.
10% of staff were in the office.
Launched #WearItForMe campaign and Y'ello Hope with a R1.2bn value.
2021
Listed MTN
Rwanda and MTN Uganda
Launched the Ambition 2025 strategy.
Donated US$25m to AU's COVID-19 vaccination programme for health workers.
Launched #OneMorePush campaign.
Exited Yemen and Syria.
2022
We refreshed our brand Total subscribers topped
289m, with 137m active data users as usage rose by a third.
Economic value add up at R149bn from R119bn.
2023
Named #1 African brand doing good for people and the planet, with leading sustainability perceptions value.
Integrated Report 2023 07
All about MTN | + | Strategic and financial review | Governance and remuneration |
How we create value |
Where we are going
Our purpose is to enable the benefits of a modern connected life for everyone
MTN is a pan-African digital operator providing a range of critical voice, data, fintech, digital, enterprise and wholesale services to around 295 million customers in 19 markets. Our purpose is embodied in our belief statement that everyone deserves the benefits of a modern connected life. Our strategic intent is leading digital solutions for Africa's progress.
MTN Group Limited is a publicly owned entity whose shares are traded on the JSE. At the end of 2023 our market capitalisation was approximately R209 billion (US$11.4 billion). Subsidiaries MTN Nigeria, MTN Ghana, MTN Uganda and MTN Rwanda are listed on the Nigerian Exchange Ltd, the Ghana Stock Exchange, the Uganda Securities Exchange and the Rwanda Stock Exchange, respectively.
Ambition 2025: Leading digital solutions for Africa's progress
Build the largest and most valuable platforms
Drive industry- leading connectivity operations
Create shared value
Accelerate portfolio transformation
Enabled by our values:
Lead with Care | Collaborate with Agility | Act with Inclusion | Can-dowith Integrity | Serve with Respect |
Creating value for all
We create value for our stakeholders across our footprint by living our purpose and belief as well as progressing our strategic intent
MTN achieved an
10.9%^
reduction in Scope 1 and 2 emissions from base-year emissions (excluding MTN SA whose performance is impacted by the IHS transaction)
^Reflects quarter 4 adjustments.
28%
women in leadership
Enabled internet
access to
150m
(2022: 137m)
active data users
Maintained female
representation at
40%
Facilitated financial
inclusion to
72ms
(2022: 69m)
active MoMo users
Empowered
17 569
MTNers
Extended digital
inclusion to
36m
(2022: 22m)
ayoba users
Connected
295m
(2022: 289m)
subscribers
Provided broadband coverage to
89.2%
(2022: 88%)
of the population
Added economic value of
~R159bn
(2022: R149bn)
across our markets
Integrated Report 2023 08
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Disclaimer
MTN Group Ltd. published this content on 29 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 April 2024 23:12:27 UTC.