By Nqobile Dludla

JOHANNESBURG, (Reuters) – Africa’s biggest mobile operator, MTN Group declared a higher annual dividend on Wednesday as a result of a progress report and a greater profit.

MTN stopped paying dividends last year in March. This was due to uncertainty about cash upstreaming Nigerian, when it will receive its proceeds from the asset realization programme and the effect of COVID.

At the time, it stated that it would issue a modified medium-term dividend strategy in March 2022. Additionally, it anticipated paying a total ordinal dividend of at least 265 cents for fiscal 2021.

Ralph Mupita, Group Chief Executive, stated that the board had examined the cash balances and solvency of the company and the investor profile for the next year and declared a dividend at 300c per share. This is 40 cents more than the minimum.

Mupita said that the new dividend policy will guide market participants annually in determining a dividend amount. This is subject to capital allocation priorities as well as market conditions.

MTN’s new policy allows it to anticipate paying an average ordinary dividend minimum of 330cs per year for 2022.

At 0900 GMT, the shares had risen 5.40% to 196.71 rand.

MTN’s 273,000,000 customers across 19 countries in Africa and the Middle East provided MTN with new medium-term guidance. The group revenue for service is now at mid-teens percent growth in constant currency terms. It was previously low to middle teens.

MTN Nigeria is expected to generate service revenue growth at least 20%, which will surpass the previous target of mid-teens.

The company’s December 31 financial results showed that group services revenue increased by 18.3%, to 171.8 billion rand (or $11 billion), which was well ahead of the medium-term goals. This is due to continued demand to data, financial and digital services.

This increase in headline earnings per stock (HEPS), its main profit measurement in South Africa, was 31.8% higher than the 987 cents it earned.

Due to its cash receipts from the operating companies, as well as its proceeds from its divestment plans, its net debt as a holding company fell to 30.1 million rand (from 43.3 billion rand).

($1 = 15.1507 rand)