Shares of MTN Group Ltd. experienced a steep decline in Johannesburg on Monday, falling by as much as 10%—the largest drop since March 2023. The plunge followed the announcement that the company’s South African revenue had fallen, leading to a management shake-up. Investors were also concerned about a U.S. Department of Justice probe into the company’s units in Iran and its former subsidiary in Afghanistan.
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To address the downturn, MTN is overhauling its leadership. The company has appointed Ferdi Moolman to replace Charles Molapisi as the new South Africa CEO and named Yolanda Cuba as Deputy CEO. Additionally, Chief Financial Officer Tsholofelo Molefe will now oversee mergers and acquisitions. Group CEO Ralph Mupita has set a three-year target to revive the domestic business, which saw a 3.7% drop in sales.
This decline stands in stark contrast to the company’s Nigerian business, where revenue jumped 37.5% to R28.4 billion in the six months ending June 30, making it a larger contributor than the South African unit.
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MTN reported a net income of R9.75 billion for the six-month period, a significant recovery from a R7.39 billion loss a year ago, which was caused by currency depreciations in Nigeria and Ghana. Despite this overall profitability, analysts like Bloomberg Intelligence’s John Davies noted that the news was “mostly negative,” citing the South African guidance cut and the ongoing U.S. investigations.
Mupita stated that the company is working to build three key platforms: connectivity, fintech, and digital infrastructure. He also noted that having too many operators in South Africa has reduced the “profit pool,” a sentiment that follows rival Vodacom’s recent acquisition of fibre assets.
