NSSF earns Shs 31.4 bn dividend from MTN

The National Social Security Fund (NSSF) has earned a total of Shs 31.482 billion as dividends for the year ended December 31, 2022, from its investment in telecom company MTN Uganda.

NSSF invested Shs 360 billion in December 2021 to acquire 1.98 billion shares in MTN Uganda following its initial public offer (IPO) the same year making the fund the second largest shareholder in the telecom giant with 8.84 per cent shareholding.

The payment is the single largest dividend earned by the fund to date in addition to Shs 9.32 billion earned in 2021. It follows the approval of payment of a final dividend of Shs 5.5 per ordinary share for the year ended December 2022 which was approved by the MTN shareholders during their annual general meeting on May 19.

While receiving a dummy cheque for the payment at NSSF headquarters at Worker’s House in Kampala, Patrick Ayota, the acting managing director of the fund said they decided to invest in MTN given its performance track record and market leadership.

“We made this decision because as a market leader in telecom and fintech, MTN plays a key role in the development of various subsectors and the economy at large. Importantly though, MTN delivers shareholder value as the company has high margins which have contributed to attractive returns on invested capital and the management of MTN has delivered consistent and sustainable growth over the years.”

MTN is the fund’s largest equity investment at 14.6 per cent of its total equities portfolio and Ayota said they are confident that this investment will continue creating value for members.

“We begin each year with a commitment to our members that we will preserve value of their savings by making sure that we promise the members a return on their savings that is at least 200 basis points above inflation. Returns to investment like this means that we shall be able to keep that commitment to our members,” he said.

MTN Uganda CEO Sylvia Mulinge noted that one of the biggest objectives of the IPO was to ensure that every Ugandan has an opportunity to be able to own a piece of MTN as part of the company’s localization agenda.

“The Shs 31.482 billion is a summation of the three dividends we have paid for the financial year 2022. NSSF is the second largest shareholder in MTN owning about 8.84 per cent which translates to 1.98 billion shares. The good thing is these shares are owned by about 1.3 million Ugandans who have a stake in the fund. So by giving these dividends to NSSF, we are returning value to the fund members in line with our company’s ambition of ensuring that we create shared value for all our stakeholders,” she said.

Mulinge also noted that through the public IPO that ran in 2021, they got 20,870 shareholders with over 200 small pension funds and Saccos representing millions of Ugandans. 

The final dividend for the financial year 2022 of Shs 5.5 per share totaling Shs 123.1 billion will be paid out to all registered shareholders on their mobile money wallets or bank accounts by June 22 2023. This is in addition to the two interim dividends that were paid out last year in September of Shs 5 per share and Shs 5.4 per share in December totaling Shs 232.8 billion.

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