MTN Nigeria Communications Plc and Airtel Africa have repaid a combined $1.2 billion in foreign currency debt in 2024 as part of efforts to mitigate the impact of foreign exchange (FX) volatility and strengthen their financial positions.
The repayment comes amid the lingering effects of the Central Bank of Nigeria (CBN)’s unification of the foreign exchange market in June 2023, which triggered a sharp devaluation of the naira from 471/$ to 1043.09/$ by December 28, 2023, and 1512.3/$ by March 7, 2025.
MTN Nigeria reported a record revenue of N3.36 trillion for 2024 but posted a loss after tax of N400.44 billion due to forex losses from the revaluation of foreign currency-denominated obligations. Without the net forex loss, MTN noted that it would have recorded a profit after tax of N247.3 billion.
Airtel Africa, which had 50.9 million subscribers in Nigeria as of March 2024, reported a 5.78 per cent decline in revenue to $3.64 billion from $3.86 billion in the nine months ending December 2024. However, its profit after tax surged by 12,300 per cent to $248 million from $2 million, driven by cost-cutting measures and debt reduction.
To ease FX pressure, MTN Nigeria reduced its outstanding letters of credit (LC) dollar obligations from $416.6 million as of December 31, 2023, to $20.8 million by the end of 2024. Airtel Africa repaid $739 million in foreign currency debt within the year, lowering its FX debt exposure.
MTN also restructured its loan portfolio, with 72 per cent now in naira and 28 per cent in dollars, compared to 56 per cent naira and 44 per cent dollars in 2023. Its total net debt dropped by 29 per cent to N591 billion by the end of 2024. To support local financing, MTN raised N190 billion under its N250 billion Commercial Paper Issuance Programme.
On an investors’ call, Modupe Kadri, MTN Nigeria’s Chief Financial Officer (CFO), revealed that the company’s overall foreign exchange exposure dropped from $1 billion in December 2023 to about $300 million by the end of 2024.
Similarly, Airtel Africa increased its local currency debt exposure to 92 per cent, up from 79 per cent a year ago. Its Chief Executive Officer, Sunil Taldar, described this as a “substantial improvement,” adding that only 8 per cent of its operational company (OpCo) debt remains in foreign currency.
To further minimise FX exposure and operating costs, both telcos renegotiated tower lease contracts with infrastructure providers such as IHS, INT Towers Limited, and ATC Nigeria. MTN’s renegotiation with IHS alone resulted in N113.8 billion in operational savings.
“We will focus on cost savings through our expenditure resiliency programme and implement localisation initiatives to further reduce foreign exchange exposure and operating expenditure,” said Karl Toriola, Chief Executive Officer of MTN.
Toriola expressed confidence that these measures would support margin recovery and improve financial resilience.
