MTN Nigeria reported a profit after tax of N355.5bn in the first quarter of 2026, up 165.9 per cent year-on-year, but warned that higher energy prices could weigh on earnings in the coming quarters.
In its unaudited results released on Wednesday, the telecom operator said it expects a 1.8 to 2.0 percentage point decline in full-year Earnings Before Interest, Taxes, Depreciation and Amortisation margins if diesel prices average N2,000 per litre in the second half of the year.
The country’s biggest telco with 89.5 million subscribers, operates more than 20,000 base stations nationwide, most of which depend on diesel generators because of unreliable grid power.
“We continue to monitor developments in the operating environment, including energy price volatility and regulatory dynamics,” Chief Executive Officer Karl Toriola said in the Q1 report.
The concern comes amid increasing volatility in Nigeria’s fuel market following global crude oil disruptions and domestic supply pressures.
In March, tensions involving the United States, Israel and Iran disrupted activities around the Strait of Hormuz, pushing crude prices above $100 per barrel and raising fuel import costs globally.
The impact filtered into Nigeria’s deregulated downstream sector, leading to higher pump prices across the country. The $20bn Dangote Refinery has increased its diesel price to N1750 per litre from N1800, while fuel prices at independent stations reportedly climbed to about N1,250 per litre in some states.
“Based on an assumed average Lagos ex-depot diesel price of N2,000 in H2, we estimate a 1.8–2.0 percentage point impact on full-year EBITDA margin,” the executive added.
According to the State of Africa’s Infrastructure Report 2025 by the Africa Finance Corporation, Nigerian telecom operators consume over 40 million litres of diesel every month to power base stations nationwide. This reliance is driven by persistent grid instability, which has made self-generation the default energy source for network operations.
On an annual basis, this translates to more than 480 million litres of diesel consumed by the sector, with industry estimates suggesting annual spending exceeding $350m.
MTN also ramped up investment spending during the period, with capital expenditure (excluding right-of-use assets) rising 92.8 per cent year-on-year to N390.3bn from N202.4bn in Q1 2025.
The company said a substantial portion of the investment was directed toward expanding network capacity and strengthening its fixed broadband footprint, particularly through fibre-to-the-home rollout and fixed wireless access infrastructure.
