Analysts, shareholders predict return of MTN, Nestle, others’ dividends

Amidst return to profitability by some publicly quoted companies, shareholders are optimistic that the dividend freeze might be over in the 2025 financial year, Daily Trust can report. The companies include major telecommunication firm, MTN Nigeria PLC; Nestle Nigeria PLC, Cadbury, WAMCO, among others. In the past two years, some of the companies have frozen […]

Amidst return to profitability by some publicly quoted companies, shareholders are optimistic that the dividend freeze might be over in the 2025 financial year, Daily Trust can report.

The companies include major telecommunication firm, MTN Nigeria PLC; Nestle Nigeria PLC, Cadbury, WAMCO, among others.

In the past two years, some of the companies have frozen dividend payouts over foreign exchange losses. Several companies involved in manufacturing and production also incurred losses.

The depreciation of the naira started in 2023 after the unification of the exchange rate, with the Central Bank of Nigeria (CBN) putting an end to the multiple exchange rates, according to the policy of the Bola Ahmed Tinubu administration.

The exchange rate triggered inflation which negatively affected the cost of living in Nigeria as headline inflation hit an all-time high of 34 per cent before the consumer price index (CPI) was rebased which brought down inflation.

With stability in the macroeconomic environment, most of the companies are now returning to profitability as their half year results indicated.

Daily Trust reports that for MTN Nigeria for instance, the shareholders have been expressing mixed feelings over the dividends payout given that their parent company, MTN Group in South Africa has continued to pay dividends.

Last year, South African telecom giant, MTN Group Limited paid a dividend on the 22nd of April, 2024 with investors receiving ZAR3.30 per share.

Despite the economic headwinds in the country, the group paid the sum which amounted to N253.41 in Nigerian local currency.

However, it was the lowest dividend payout to shareholders at the time, down from the annual ZAR8.73 (N670.39).

The MTN Group is described “as an emerging market communication services provider at the forefront of technological and digital innovation with presence in 19 countries in Africa and the Middle East.”

The MTN Group has a total of 294.8m subscribers worldwide with 79.7m of those in Nigeria, meaning that Nigeria has the most MTN subscribers going by last year’s data. This also implies that most of the company’s revenue is earned in Nigeria and South Africa.

Though many shareholders reportedly expressed mixed feelings over the shrinking dividend payout by the group, it was generally agreed that paying a little is better than not paying at all.

Despite the MTN Group, the parent company, paying dividends to its shareholders, the Nigerian did not enjoy the same privilege last year.

Since its listing in the Nigerian Exchange (NGX), MTN has been paying dividends to its shareholders. From slightly above N8 per ordinary share, it reduced N5.60k per share amidst doubt whether there would be dividend payout in the previous year.

In the 2023 year, MTN Nigeria recorded a significantly higher net foreign exchange loss of N740.4 billion, an 805% increase over 2022 (N81.8 billion). This culminated in the reported loss after tax of N137.0 billion, compared to a restated profit after tax of N348.7 billion in 2022.

Fast forward to Year 2025, the macroeconomic environment is stabilising with foreign exchange, though still high, stabilising while the economy is experiencing a marginal disinflation.

 

Return to profitability

For instance, MTN Nigeria Plc reported a pre-tax profit of N419.61 billion, a major turnaround from the pre-tax loss of N179.60 billion recorded in the same period last year.

This performance builds on the N202.63 billion pre-tax profit posted in Q1 2025, bringing H1 2025 pre-tax profit to N622.24 billion.

It also marks the third consecutive quarterly profit for the telecom giant after struggling with losses in 2023 and 2024 due to significant foreign exchange losses and high interest expenses, largely driven by naira devaluation.

 “We are excited by the progress made in the first half of 2025, reflecting the successful execution of the strategic priorities we previously communicated to the market,” CEO Karl Toriola stated while commenting on the results.

Similarly, Nestlé Nigeria Plc extended its rebound streak for a third straight quarter, hitting a net profit of N50.6 billion in the first half of 2025.

This is a sharp reversal from a N176.6 billion loss a year earlier, as the food giant capitalised on rising sales and a more stable macroeconomic backdrop.

Revenue surged 43 percent year-on-year to N581.1 billion, driven by resilient consumer demand and price adjustments, the company said in an unaudited financial statement released Tuesday.

Operating profit more than doubled to N130.4 billion, while profit before tax climbed to N88.4 billion, swinging from a N252.5 billion pre-tax loss in the same period of 2024.

The results mark a continuation of Nestlé’s recovery that began in the final quarter of last year, after the company was battered by foreign exchange losses stemming from the naira’s devaluation and broader macroeconomic instability.

Also, Cadbury Nigeria PLC, a company which has not paid dividends since 2022 seems to be looking good this year and shareholders are optimistic this year.

The company posted a profit of N10.2bn for the half year ended June 30, 2025, reversing a loss of N9.7bn recorded in the same period of 2024. This represents a remarkable turnaround with a 205 per cent increase in profit.

Analysts at CardinalStone had earlier forecast that MTN Nigeria Communications Plc is likely to resume dividend payments in the 2025 financial year, supported by improving operations and strong earnings recovery.

In a research report titled “Positive outlook affirmed for telco bellwether” published on August 5, 2025, the firm noted that MTN, which last paid a dividend in 2023, may soon be able to reward shareholders again.

The report noted that MTN’s strong Q2 2025 performance significantly improved its balance sheet, with negative equity shrinking from N458 billion at the end of 2024 to just N42.51 billion by mid-2025.

Speaking with our correspondent, former secretary of Independent Shareholders Association of Nigeria (ISAN), Adeleke Adebayo stated that shareholders’ expectation is to get dividends this year.

However, he stated that the capital appreciation of the stocks of most companies is an exciting development for investors.

He said, “It is not only dividends that shareholders get out of their investment. Some people hold shares for different reasons but one of the ones that give them benefit is capital appreciation.

“You will see that immediately after the forex hullabaloo early last year, a company like Nestle had moved from N700-N750 to its current price (N1,890). So people are still happy with that kind of increase in value without having cash inflow in terms of dividend payment. But like I said everybody would be happy to have additional cash in their pocket.

“So we would be happy to have some of these companies return to dividend payment and give more value back to shareholders. I believe that the basic issue we had around forex last year which impacted a lot of manufacturing concerns including the LAFARGEs, the BUAs, the Dangote’s, WAMCO, among others, we are gradually getting out of it now based on their current results.”

According to him, any company that had not reversed its result now would definitely get out of the loss by the end of this quarter.

Also speaking, another shareholder, Pastor Olagoke Samson said, “I am sure that coming this year, MTN and others must pay dividend for shareholders.”

He stated that most companies performed well as results of their half year performance indicated, adding, “I am sure that shareholders will smile.”