South Africa’s MTN Group has repatriated its last year’s dividend of around $280 million (R4.2 billion) from its local unit in Nigeria.
The company reported the payout during the release of preliminary financial results for the six months to June 30, 2021.
The funds from Nigeria are part of approximately $650 million (R9.3 billion) in cash the pan-African telecoms giant returned from its subsidiaries.
The Johannesburg-based group had been struggling to get dividends out of its subsidiaries due to the challenges of securing foreign currency in Nigeria and some other markets where it operates.
As a result, MTN was forced to suspend dividend payout for the 2020 financial year. The company also cited other reasons for the suspension, such as the timing of proceeds from an ongoing asset realisation programme (ARP) and the impact of the Covid-19 pandemic.
Announced in March 2019, the ARP seeks to simplify the group’s portfolio, reduce debt and improve returns. Over a three-year period, the programme is expected to bring in proceeds of at least R15 billion ($1 billion).
“Cash upstreaming from Nigeria remained challenging in terms of securing foreign currency in the market. During 2020, we upstreamed the equivalent of approximately R286 million from Nigeria, with approximately R4.2 billion yet to be repatriated as of 31 December 2020,” the company said back in March.
The group has now fully secured its cash dividend from Nigeria, in what is one of the two positive developments concerning MTN that will come as a relief to shareholders.