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MIRA INFORM REPORT
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Report No. : |
486991 |
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Report Date : |
24.01.2018 |
IDENTIFICATION DETAILS
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Name : |
MTN UGANDA |
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Registered Office : |
MTN Towers, 22 Hannington Road, P.O. Box 24624, Kampala |
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Country : |
Uganda |
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Financials (as on) : |
31.12.2016 |
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Date of Incorporation : |
25.02.1998 |
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Com. Reg. No.: |
P498 |
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Legal Form : |
Limited Corporation |
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Line of Business : |
Registered to Operate Mobile
and Telecommunication Services and Solutions |
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No. of Employees : |
2800 |
RATING & COMMENTS
(Mira Inform has adopted New Rating mechanism w.e.f. 23rd
January 2017)
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MIRA’s Rating : |
A |
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Credit Rating |
Explanation |
Rating Comments |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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Status : |
Satisfactory |
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Payment Behaviour : |
No Complaints |
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Litigation : |
Clear |
NOTES :
Any query related to this report can be made on
e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List
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Country Name |
Previous Rating (30.06.2017) |
Current Rating (30.09.2017) |
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Uganda |
B2 |
B2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
UGANDA - ECONOMIC OVERVIEW
Uganda has substantial natural resources, including fertile soils,
regular rainfall, small deposits of copper, gold, and other minerals, and
recently discovered oil. Agriculture is the most important sector of the
economy, employing more than one-third of the work force. Coffee accounts for
the bulk of export revenues. Uganda has a small industrial sector that is
dependent on imported inputs like oil and equipment. Overall productivity is
hampered by a number of supply-side constraints, including underinvestment in
an agricultural sector that continues to rely on rudimentary technology.
Industrial growth is impeded by high-costs due to poor infrastructure, low
levels of private investment, and the depreciation of the Ugandan shilling.
Since 1986, the government - with the support of foreign countries and
international agencies - has acted to rehabilitate and stabilize the economy by
undertaking currency reform, raising producer prices on export crops,
increasing prices of petroleum products, and improving civil service wages. The
policy changes were especially aimed at dampening inflation while encouraging
foreign investment to boost production and export earnings. Since 1990,
economic reforms ushered in an era of solid economic growth based on continued
investment in infrastructure, improved incentives for production and exports,
lower inflation, and better domestic security.
The global economic downturn in 2008 hurt Uganda's exports; however,
Uganda's GDP growth has recovered due to past reforms and a rapidly growing
urban consumer population. Oil revenues and taxes are expected to become a
larger source of government funding as production starts in the next five to 10
years. However, lower oil prices since 2014 and protracted negotiations and
legal disputes between the Ugandan government and oil companies may prove a
stumbling block to further exploration and development.
Uganda faces many economic challenges. Instability in South Sudan has
led to a sharp increase in Sudanese refugees and is disrupting Uganda's main
export market. High energy costs, inadequate transportation and energy
infrastructure, insufficient budgetary discipline, and corruption inhibit
economic development and investor confidence. Between 2015 and 2017, the Uganda
shilling depreciated 50% against the dollar.
The budget is dominated by energy and road infrastructure spending,
while relying on donor support for long-term drivers of growth, including
agriculture, health, and education. The largest infrastructure projects are
externally financed through low-interest concessional loans. As a result, debt
servicing for these loans is expected to rise.
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Source
: CIA |
Company
name
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Registered Name: |
MTN UGANDA |
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Requested Name: |
MTN UGANDA LIMITED |
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Trade Names: |
MTN UGANDA LIMITED |
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ADDRESS
AND TELECOMMUNICATION
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Physical Address: |
MTN Towers, 22 Hannington Road, |
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Postal Address: |
P.O.
Box 24624, |
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Kampala, |
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Country: |
Uganda |
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Phone: |
256-312-212333/212013 |
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Cell: |
256-772120256 |
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Fax: |
256-31-2212233 |
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Email: |
customerservices@mtn.co.ug/ mtn@mtn.co.ug/ ahmeda@mtn.co.ug |
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Website: |
www.mtn.co.ug |
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CREDIT
OPINION & RISK RATING ASSESSMENT
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Financial Index as of December
2017 shows subject firm with a medium risk of credit. However, bank and
credit information obtained reveal a history of prompt payments. |
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LEGAL
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Legal Form: |
Limited Corporation |
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Date Incorporated: |
25-Feb-1998 |
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Launched: |
21-Oct-1998 |
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Reg. Number: |
P498 |
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Nominal Capital |
UGS. 4,000,000 |
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Subscribed Capital |
UGS. 4,000,000 |
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Paid Up Capital |
UGS. 4,000,000 |
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Subscribed Capital is Subscribed in the following form: |
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Position |
Shares |
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Mr. Charles Magezi
Mbire |
Chairman |
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Mr. Brian Gouldie |
CEO |
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Mr. Mike Blackburn |
CFO |
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Ms. Mapula Bodibe |
CMO |
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Ms. Winnie Banage |
Manager |
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Ms. Hazel Twesigye |
Manager |
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Mr. John Kamanyire |
Forensics |
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Invesco Uganda Limited |
Shareholder |
4.00% |
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Mtn International Limited, Mauritius |
Holding Company |
96.00% |
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RELATED
COMPANIES
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Mtn International
Limited, Mauritius |
Parent company. |
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None |
Subsidiary company. |
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Listed Below |
Affiliated companies. |
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Invesco Uganda Limited |
Shareholders of subject
firm. |
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Various in Uganda |
Branches of the firm |
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OPERATIONS
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Registered to operate
mobile and telecommunication services and solutions |
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Imports: |
Asia, Africa |
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Exports: |
None |
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Trademarks: |
None |
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Terms of sale: |
Cash (60%) and 25-90 days (40%), invoices. |
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Main Customers: |
General Public, firms and organizations |
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Employees: |
2800 employees. |
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Vehicles: |
Several motor vehicles. |
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Territory of sales: |
Uganda |
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Location: |
Owned premises, 120,000 square feet, |
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AUDITORS
AND INSURANCE
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Auditors: |
Information not
available. |
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Insurance Brokers: |
Information not
available. |
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FINANCE
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Currency Reported: |
Ugandan Shillings (UGS.) |
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Approx. Ex. Rate: |
1 US Dollar = 3622.01 Ugandan Shillings |
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Fiscal Year End: |
December 31, 2017 |
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Inflation: |
According to information given by independent sources, the inflation
at December 31st, 2017 was of 15%. |
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Group Financial
Information Submitted |
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BANK
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Bank Name: |
STANBIC
BANK UGANDA LIMITED |
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Branch: |
Uganda |
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Comments: |
None |
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TRADE REFERENCES
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Experiences: |
Good |
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NOTARIAL BONDS
None |
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COMMENTS
/ ADDITIONAL INFORMATION
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This information was
obtained from outside sources other than the subject company itself and
confirmed the above subject. |
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AFFILIATED COMPANIES (VARIOUS WORLDWIDE) |
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AREEBA AFGHANISTAN |
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LIBERTIS TELECOM |
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MOBILE TELEPHONE NETWORKS (PTY ) LTD SOUTH AFRICA |
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MTN AFGANISTAN LTD, AFGHANISTAN |
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MTN BENIN LTD |
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MTN CAMEROON |
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MTN CONGO BRAZZAVILLE |
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MTN CONGO BRAZZAVILLE - BRAZZAVILLE, CONGO |
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MASCOM LTD |
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MTN CYPRUS LTD, CYPRUS |
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MTN GHANA LTD |
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MTN GUINEA BISSAU LTD, GUINEA |
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MTN GUINEA LTD |
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MTN HOLDINGS LTD, SOUTH AFRICA |
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MTN INTERNATIONAL (MAURITIUS) LTD, MAURITIUS |
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MTN INTERNATIONAL LTD, SOUTH AFRICA |
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MTN IRAN |
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MTN LIBERIA LTD |
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MTN NETWORK SOLUTIONS (PTY) LTD, SOUTH AFRICA |
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MTN NIGERIA |
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MTN RWANDACELL S.A.R.L |
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MTN SERVICE PROVIDER, SOUTH AFRICA |
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MTN SUDAN LTD |
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MTN SWAZILAND LTD |
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MTN SYRIA LTD |
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MTN IVORY COAST |
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MTN YEMEN LTD |
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MTN ZAMBIA LIMITED |
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ORBICOM RANDBURG, SOUTH AFRICA |
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SPACETEL GUINEA-BISSAU |
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SUPERCELL DRC |
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TELECEL ZAMBIA LTD |
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MTN CAMEROON |
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ELEMENTONE LIMITED JOHANNESBURG, SOUTH AFRICA |
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NATIONAL EMPOWERMENT CONSORTIUM
SOUTH AFRICA |
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NEWSHELF 664 (PTY) LTD, SOUTH AFRICA |
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BASHAIR TELECOM, SUDAN |
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I-TALK (PTY) LTD , SOUTH AFRICA |
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IRANCELL LTD, SOUTH AFRICA |
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JOHNNIC HOLDINGS LTD, SOUTH AFRICA |
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LEAF (PTY) LTD , SOUTH AFRICA |
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AROBASE TELECOM SA |
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AFNET INTERNET SERVICES S.A. – A.I.S. |
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SUMMARY
CONSOLIDATED INCOME STATEMENT |
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FOR THE YEAR ENDED 31 DECEMBER |
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2016 |
2015 |
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Sales |
147,920 |
147,063 |
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Other income |
335 |
8,409 |
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Direct network and technology operating costs |
-23,520 |
-18,809 |
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Costs of handsets and other accessories |
-12,304 |
-10,829 |
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Interconnect and roaming costs |
-13,393 |
-13,102 |
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Staff costs |
-9,152 |
-8,587 |
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Selling, distribution and marketing expenses |
-19,172 |
-18,412 |
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Government and regulatory costs |
-5,191 |
-5,888 |
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Other operating expenses |
-14,273 |
-11,433 |
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EBITDA before Nigeria regulatory fine |
51,250 |
68,412 |
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Nigeria regulatory fine |
-10,499 |
-9,287 |
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EBITDA |
40,751 |
59,125 |
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Depreciation of property, plant and equipment |
-20,988 |
-19,557 |
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Amortisation of intangible assets |
-4,748 |
-3,736 |
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Impairment of goodwill |
-873 |
-504 |
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Operating profit |
14,142 |
35,328 |
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Net finance costs |
-10,495 |
-3,010 |
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Net monetary gain |
1,723 |
1,348 |
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Share of results of joint ventures and associates after tax |
-127 |
1,226 |
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Profit before tax |
5,243 |
34,892 |
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Income tax expense |
-8,346 |
-11,322 |
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(Loss)/profit after tax |
-3,103 |
23,570 |
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SUMMARY
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME |
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FOR THE YEAR ENDED 31 DECEMBER |
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2016 |
2015 |
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(Loss)/profit after tax |
-3,103 |
23,570 |
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Other comprehensive income after tax |
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Items that may be subsequently reclassified to profit or loss |
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Net investment hedges |
-1,887 |
– |
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Foreign exchange movement on hedging instruments |
-2,684 |
– |
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Deferred tax |
797 |
– |
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Available-for-sale financial assets1 |
2,672 |
– |
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Gains arising during the year |
2,672 |
– |
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Exchange differences on translating foreign operations including the effect
of hyperinflation1 |
-22,907 |
22,203 |
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(Losses)/gains arising during the year |
-22,907 |
22,203 |
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Other comprehensive income for the year |
-22,122 |
22,203 |
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Attributable to equity holders of the Company |
-21,077 |
21,033 |
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Attributable to non-controlling interests |
-1,045 |
1,170 |
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Total comprehensive income for the year |
-25,225 |
45,773 |
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SUMMARY
CONSOLIDATED STATEMENT OF CASH FLOWS |
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FOR THE YEAR ENDED 31 DECEMBER |
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2016 |
2015 |
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Net cash generated from operating activities |
20,716 |
13,122 |
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Cash generated from operations |
55,681 |
57,598 |
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Dividends paid to equity holders of the Company |
-19,792 |
-23,506 |
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Dividends paid to non-controlling interests |
-1,178 |
-5,777 |
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Dividends received from associates and joint ventures |
692 |
577 |
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Other operating activities |
-14,687 |
-15,770 |
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Net cash used in investing activities |
-40,408 |
-34,290 |
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Acquisition of property, plant and equipment |
-29,899 |
-21,612 |
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Acquisition of intangible assets |
-5,348 |
-10,412 |
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Increase in non-current investments |
-2,199 |
-3,319 |
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Acquisition of bonds, treasury bills and foreign deposits |
-2,704 |
-542 |
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Movement in other investing activities |
-258 |
1,595 |
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Net cash from financing activities |
20,951 |
8,101 |
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Proceeds from borrowings |
59,647 |
23,384 |
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Repayment of borrowings |
-37,211 |
-14,802 |
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Buy-back of shares from MTN Zakhele |
-2,645 |
– |
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Premium received on option issued to MTN Zakhele Futhi |
1,185 |
– |
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Other financing activities |
-25 |
-481 |
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Net increase/(decrease) in cash and cash equivalents |
1,259 |
-13,067 |
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Cash and cash equivalents at beginning of the year |
34,139 |
43,072 |
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Exchange (losses)/gains on cash and cash equivalents |
-8,192 |
3,860 |
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Net monetary gain on cash and cash equivalents |
169 |
274 |
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Net cash and cash equivalents at end of the year |
27,375 |
34,139 |
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 63.77 |
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1 |
INR 89.20 |
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Euro |
1 |
INR 78.22 |
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UGX |
1 |
INR 0.018 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
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Analysis Done by
: |
NIY |
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Report Prepared
by : |
TPT |
RATING EXPLANATIONS
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Credit Rating |
Explanation |
Rating Comments |
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A++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
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A+ |
Low Risk |
Business dealings permissible with low
risk of default |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
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C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
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D |
High Risk |
Business dealing not recommended or on
secured terms only |
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NB |
New Business |
No recommendation can be done due to
business in infancy stage |
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NT |
No Trace |
No recommendation can be done as the
business is not traceable |
NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.
This score serves as a reference to assess
SC’s credit risk and to set the amount of credit to be extended. It is
calculated from a composite of weighted scores obtained from each of the major
sections of this report. The assessed factors are as follows:
·
Financial
condition covering various ratios
·
Company
background and operations size
·
Promoters
/ Management background
·
Payment
record
·
Litigation
against the subject
·
Industry
scenario / competitor analysis
·
Supplier
/ Customer / Banker review (wherever available)
This report is issued at
your request without any risk and responsibility on the part of MIRA INFORM
PRIVATE LIMITED (MIPL) or its officials.