Telecommunications giant, MTN, recorded a 29.14% decline in its net profit for the first half of 2023, largely due to the liberation of the foreign exchange regime by the Central Bank of Nigeria.
The CBN on June 14 collapsed all segments of the market into the investor and exporter (I&E) window and reintroduced the ‘willing buyer, willing seller’ model. This has led to an approximately 60% movement in the exchange rate, since the announcement, to N756.24/$ at the end of June 2023 as the market seeks an equilibrium level.
According to its unaudited results for the half-year ended June 30, MTN posted a profit of N128 billion, compared to N181bn during the same period in 2022.
MTN, which is Nigeria’s biggest company by market value, however, reported a revenue growth of N1.15 trillion from N950bn in the same period in 2022.
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While noting that the liberalisation of the forex regime and removal of fuel subsidy provide a clear pathway to the return of international capital into the capital markets, it however, added that “the immediate impact on our results for H1 was the unrealised forex losses included in our net finance charges.”
One of the largest food and beverage companies in Africa, Nestlé Nigeria PLC, reported revenue of N261.8 billion in the first half of 2023, representing a 17.7% increase compared to its performance in the same period of 2022.
It also had a 34% increase in Gross profit, hitting N107.3bn from the N80.2bn earned in H1 2022. The Company posted a loss after tax of N49.9 billion, a 280% decline over the same period in 2022.
The losses are mainly due to the recent devaluation policy of the CBN.
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