Salient features:
- Mobile subscribers increased by 6.1 million to 64.3 million
- Active data users increased by 6.5 million to 25.2 million
- Service revenue increased by 12.6% to NGN1.2 trillion
- EBITDA grew by 45.2% to NGN629.9 billion (IAS 17: 20.9% to NGN524.4 billion)
- EBITDA margin increased by 12.1 pp to 53.9% (IAS 17: 44.8%, up 3.0 pp)
- Profit before tax grew by 31.1% to NGN290.1 billion (IAS 17: 39.9% to N309.6 billion)
- Earnings per share rose by 38.8% to NGN9.9k (IAS 17: 47.9% to N10.6k)
- Capital expenditure (capex) (excluding right of use assets) increased by 13.1% to N208.3 billion
- Final dividend of NGN4.97 kobo per share recommended
Company operational review
During the year, we focused on building our subscriber base, resulting in growth of 10.5% in net additions to a total of 64.3 million subscribers. Our active data subscribers rose by 34.9% to 25.2 million on the back of several initiatives. As a result, the ratio of active data users to total mobile subscribers increased by 7.1 pp to 39.2% in 2019 with strong potential for future growth.
Voice revenue growth remained healthy at 8.4% and accounted for 72.7% of service revenue. Voice traffic increased by 7.6%, supporting revenue growth.
In addition, we have seen rapid acceleration in data revenue growth enabled by greater population coverage, a revamp of our data portfolio and initiatives to drive 4G device penetration. We added 5.3 million new smartphones to our network, bringing smartphone penetration to 41.8% of our base, while data traffic rose by 85.8%. Our interventions in the year helped to drive a 42.4% increase in data revenue for the year (63.1% YoY in Q4 2019). Data contributed 18.8% to service revenue, up 3.9 pp from 14.9% in 2018.
Digital revenue gained momentum as we started to see quarterly growth from Q3 2019. We further focused on building a sustainable active user base for our digital business, while improving the customer journey and experience on value-added services (VAS). In Q4 2019, we launched MusicTime, one of our flagship digital offerings. The active base for our digital subscriptions surpassed 2.1 million users during the year, as we continue to build critical mass for our portfolio of digital products and services. On a sequential QoQ (quarter-on-quarter, Q4 19 vs Q3 19) basis, digital revenue increased by 23.0% and we target sustained growth into 2020.
Fintech revenue growth was 23.3%, supported by increased adoption of MTN Xtratime, our airtime lending service. We launched a super-agent service in August and are pleased with the initial rollout and uptake of the service. We closed the year with a network of 108,000 agents registered nation- wide. The agent network served almost one million customers in the first four months of operation, and we are maintaining our focus on further expansion. To cater to a broader market and encourage further adoption, we are also widening the service offering - from basic transfer service and airtime/data sales to a more extensive bouquet, including cash deposit and withdrawal services, bill payments and facilitating e-commerce.
Our enterprise business segment continued to deliver solid results, with revenue growth of 20.3%.
On the cost side, the increase in operating expenses on an IAS 17 basis was 4.4%, which was below the rate of inflation. This reflects progress with our cost management initiatives and reduction of non- recurring expenses. We maintained our leadership position in network net promoter score (NPS) as we continued to invest to improve service quality and drive 4G expansion. This resulted in a 13.1% increase in capital expenditure and capex intensity of 17.8% on an IAS 17 basis. Our overall cash flow performance was pleasing, with a 26.6% growth in free cash flow to NGN316.1 billion (IFRS 16: 51.4% to NGN378.0 billion).
Overall, our bottom-line remained strong with growth of 31.1% and 38.8% respectively in profit before and after tax. Earnings per share increased by 38.8% to N9.9k.
Company outlook
We are optimistic about the prospects for our business in 2020 and pleased with the continued momentum from H2 of 2019, and particularly Q4. Expanding 4G network coverage to deliver high- speed internet to more people nation-wide and data revenue growth remain in focus. We expect growth in voice revenue to remain healthy. We continue to make good progress with the expansion of our super-agent network and are confident that the expanded service offerings will position us to effectively drive broader financial inclusion as well as roll out the payment service bank seamlessly, once we receive a licence.
We acknowledge the outbreak of Corona Virus worldwide and its potential impact on our supply chain. While we monitor unfolding developments, we are exploring multiple scenarios in a bid to mitigate the impact.
Over the next three years, we plan to invest about NGN600 billion in our network. This investment will enable us to accelerate our 4G network expansion, deepen population coverage and support the Federal Government's broadband initiative. We are excited about the possibilities that the transition to digital presents for our business, and the growth and development of Nigeria.
