MTN Uganda has bounced back from the one-off impact of a UGX 110.9 billion tax settlement with Uganda Revenue Authority (URA).
The telecom reported a steady rebound in profit and double-digit revenue growth in its nine-month results to September 2025.
MTN posted a 2.6% rise in profit after tax to UGX 471.2 billion, but excluding the tax settlement, underlying profit surged by 26.7% to UGX 582.1 billion.
“Our nine-month performance reflected our continued commercial execution and momentum in a competitive operating environment, mitigated by some benefit from the ongoing macroeconomic stability in the country,” said Sylvia Mulinge, Chief Executive Officer of MTN Uganda.
“We are pleased with the positive trajectory in our overall topline growth and profitability in Q3, demonstrating the resilience of our portfolio and continued efforts to drive efficiencies in the business.”
Tax drag behind, core profit rebound
MTN Uganda’s first half of 2025 was overshadowed by a UGX 110.9 billion one-off payment to URA following a transfer pricing audit covering 2012 to 2024.
That payment depressed interim profit and slowed the company’s momentum mid-year.
However, the latest results show that the drag was temporary. Excluding the tax charge, adjusted profit margins expanded to 21.9%, up 2.2 percentage points year-on-year, while the reported EBITDA rose 18.5% to UGX 1.43 trillion.
The EBITDA margin improved to 53.9%, reflecting MTN’s disciplined execution and cost efficiency.
“The growth in revenue and implementation of expense efficiencies drove an increase in EBITDA of 18.5% and margin expansion of 2.2 percentage points to 53.9%,” Mulinge said in her commentary.
MTN attributes the rebound to stronger operational execution and an improved macroeconomic backdrop, with inflation averaging 3.9% and the shilling appreciating 5.5% against the dollar during the period.
Data takes the lead as usage soars
Data remained MTN Uganda’s strongest growth driver, with revenue up 30.2% to UGX 762.8 billion, bolstered by both customer acquisition and usage growth.
Active data subscribers rose 18.6% to 11 million, while average data consumption per user rose 21.4%.
The company attributed the gains to improved network quality, service personalization, and the ongoing rollout of high-speed broadband and fiber infrastructure.
“A total investment of UGX 299.8 billion in capex was deployed to improve voice clarity, data speeds, and mobile money platform stability; enabling an enhanced customer experience,” Mulinge said.
MTN’s 5G population coverage grew to 19.0%, up from 15.3% in 2024, while 4G coverage expanded to 88.3%.
Data traffic rose 44.1%, with 4G accounting for 81.2% of total data traffic. Home broadband usage was particularly strong, with active subscribers more than doubling (+114%) as MTN accelerated its fiber rollout to 20,814 km across major towns.
Data’s contribution to total service revenue increased by 3.7 percentage points to 29.1%, solidifying MTN’s shift from traditional voice to digital-led services.
Fintech growth regains momentum
Fintech remained a major pillar of growth, with revenue up 17.9% to UGX 809 billion, driven by mobile money services and advanced fintech offerings.
Mobile money transaction volumes increased by 19.2% to 3.6 billion, while transaction value rose 23% to UGX 140.8 trillion.
MTN also grew its active fintech users by 8% and expanded its agent base by 13% to 232,000, despite a reduction in merchants due to stricter registration requirements.
“In our effort to deepen financial inclusion and evolve our business towards more advanced services, we launched cross-border payments services between Uganda and Tanzania, as well as partnered with Dubai Duty Free to accelerate international remittances,” Mulinge said.
Those moves, she added, were designed to deliver “a differentiated experience for our customers across investment, insurance, and lending platforms.”
The growth of advanced services was tempered by regulatory safeguards around partner-led lending and tighter merchant onboarding, but advanced fintech revenue still grew 25.2%, contributing 29.3% of total fintech revenue, up from 27.6% last year.
Voice holds steady despite MTR cuts
Voice revenue inched up 0.8% to UGX 949.2 billion, showing resilience despite the impact of lower mobile termination rates (MTRs) implemented in late 2024.
MTN mitigated the impact through “intensified on-ground execution in subscriber acquisition and service excellence.”
“Voice revenue continued to be impacted by the revised mobile termination rates (MTR) implemented in Q4 2024; however, we mitigated this through intensified on-ground execution in subscriber acquisition and service excellence,” Mulinge explained.
Excluding interconnect income, outgoing voice revenue grew 4.5% year-on-year, supported by improved network quality and competitive bundle offers.
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MTN Uganda’s financial position remained robust. Free cash flow rose 32.2% to UGX 963.6 billion, demonstrating strong liquidity.
The net debt-to-EBITDA ratio stood at 0.7x, reflecting a conservative balance sheet.
Capex excluding leases rose 0.7% to UGX 299.8 billion, while capex intensity fell to 11.3%, down from 12.8% a year earlier.
Mulinge noted that capital was prioritized for “core network capacity, site modernization, and strategic site rollouts,” positioning the company for sustained growth.
Board rewards investors with 40% dividend boost
Following the recovery in profitability, MTN Uganda’s board declared a second interim dividend of UGX 10.5 per share (UGX 235.1 billion), representing a 40% increase over the prior year.
In a significant policy shift, the board also enhanced the company’s dividend policy, raising the minimum payout ratio from 60% to 75% of annual profits after tax.
“The board has approved an enhancement of the company’s dividend policy, increasing the minimum medium-term payout ratio to 75% of annual profits after tax, up from the previous ratio of 60% approved in 2020,” the directors said in their statement.
Book closure is set for December 1, 2025, with payment scheduled for December 19, 2025.
The stronger payout reaffirms MTN’s commitment to delivering “strong and consistent returns to its shareholders,” even as it continues investing in long-term growth.
Brand leadership and sustainability milestones
MTN Uganda’s operational turnaround was matched by brand and social impact achievements.
The telecom was recognized as the most admired brand in Uganda at the Brand Africa 100 awards and was named Employer of the Year 2025 by the Federation of Uganda Employers, both for the second consecutive year.
“With our Mission First, People Always mantra, we continue to shape the organizational culture to provide the best possible work environment for our staff,” Mulinge said.
MTN also launched its inaugural Sustainability Report in Q3 2025, aligning its business with the UN Sustainable Development Goals.
The report highlights initiatives to bridge the digital divide and expand access to financial services, especially in rural communities.
The company’s partnership with NSSF for a charity run raised UGX 1.5 billion, improving learning conditions and digital literacy in 25 primary schools across Uganda, benefiting over 40,000 students.
It also launched the Pachi Panda Innovation Challenge in partnership with the World Wide Fund for Nature (WWF), inviting youth-led enterprises to develop sustainable environmental solutions — a direct alignment with Uganda’s Vision 2040 priorities.
Regulatory and economic outlook
Looking ahead, MTN Uganda remains upbeat but cautious. According to the Bank of Uganda, inflation is projected to remain below 5%, supported by exchange rate stability and improved food supply.
However, the company flagged risks from “higher import costs due to trade barriers, increased government spending due to elections, and adverse weather conditions.”
On regulation, MTN is engaging the Uganda Communications Commission (UCC) on the future trajectory of MTRs, with a final determination expected before year-end.
The company is also awaiting approvals for the structural separation of its fintech business, noting that the transaction “is still under regulatory review” and subject to “all required approvals and no-objections.”
Growth intact, though cautious
MTN maintained its medium-term guidance of ‘upper teens’ service revenue growth and stable EBITDA margin above 50%, but acknowledged that full-year 2025 growth would likely fall below that range due to MTR cuts and slower fintech expansion.
“With macroeconomic stability, we are well positioned to maintain our commercial momentum in support of our growth ambitions for the remaining quarter of 2025,” Mulinge said.
The company expects an increase in Q4 capex to expand coverage and data capacity, keeping full-year capex intensity in the “low teens.”
From fiscal setback to financial resilience
MTN Uganda’s 9M 2025 results mark a clear inflection point. Having absorbed a significant one-off tax settlement, the company has restored growth, fortified margins, and strengthened its balance sheet.
With a diversified portfolio across data, fintech, and digital services, and a shareholder-friendly dividend policy, MTN Uganda has demonstrated that fiscal turbulence can coexist with strategic agility.
Its message to the market is clear: the tax settlement is history; the recovery and renewed profitability have only just begun.
