Johannesburg-based MTN Group has disclosed in the company’s annual report published yesterday that the former CEO, Sifiso Dabengwa was paid $1.6 million after he resigned following a record $5.2 billion fine levied the telco by Nigerian regulators.
The Multinational mobile telecommunications company, reported that the non disconnection of subscribers in Nigeria affected its consolidated subscriber base which decreased by 1.4 percent quarter-on-quarter to 229.339 million in 22 countries across Africa and the Middle East for the period ended 31 March 2016.
MTN Nigeria reported a 6.9% fall in users to 57.045 million, largely stemming from the disconnection of some 4.5 million SIMs in February 2016 which was related to the registration compliance exercise.
MTN South Africa recorded a 1.7% q-o-q fall in subscribers to 30.077 million impacted, it said, ‘by seasonality and the alignment of the subscriber base recently’.
According to group, “We believe we have now dealt with all the subscribers who were considered to be non-compliant. The operation continues to focus on reconnecting subscribers through proactive engagement and win-back offers. Following the reinstatement of regulatory services in March 2016, MTN Nigeria continued to engage the regulatory authorities and we hope to receive approval from the regulator for approval of promotional products and services during the current month.”
The pre-paid subscriber base declined from 1.8% q-o-q to 24.9 million, largely impacted by seasonal trends following strong promotions in Q4 2015.
The post-paid base decline of 0.8% to 5.2 million was attributed to the alignment of the Autopage subscriber base to MTN’s, the disconnection of telemetry SIMs and the expiration of legacy low-cost packages.
The company added that first-quarter subscriber growth across many markets was also impacted by the weak macro-environment, particularly in those markets reliant on oil exports.
Commenting on the results, MTN group executive chairman, Phuthuma Nhleko, said: ‘During the first quarter of 2016, the Group was impacted by the ‘after shocks’ of the events that took place towards the end of 2015, mainly the subscriber registration process in many of the countries in which we operate, with Nigeria being the largest. In order to mitigate any future regulatory challenges, the Group took an exceptionally conservative stance by disconnecting all subscribers who could possibly be deemed to be non- compliant. This has had a significant unfavourable impact on total subscriber growth and revenue in 1Q16.
“Nonetheless, we believe this resolve to address compliance matters decisively has put the Group on a solid footing as regards the subscriber registration process and regulatory matters in general. Further, the Group has undertaken a number of ‘back to the basics’ structural and operational initiatives that will hopefully reset and position the Group for future growth in a rapidly evolving sector. Subscriber growth was also impacted by the weak macro-environment, particularly in those markets reliant on oil exports. The trading environment was highly competitive.”
MTN Group however said that it expects to add a net 11.9 million new subscribers by the end of 2016, down from an earlier forecast of 12.5 million.
Meanwhile, Executive chairman, Phuthuma Nhleko, who took over from Dabengwa as to resolve the fine with Nigeria got paid R5 million for 2015 work from November 9.

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