| 2.3 |
Other income
Other income is recognised when the risks and rewards of ownership of the assets are
transferred to the buyer.
| |
2017
Rm |
|
2016
Rm |
|
| Realisation of deferred gain on Ghana tower sale1 |
27 |
|
31 |
|
| Gain on dilution of investment in joint venture (note 9.2) |
28 |
|
277 |
|
| Profit on exercise of exchange right of IHS |
6 017 |
|
– |
|
| Gain on modification of financial liabilities2 |
323 |
|
– |
|
| Other |
196 |
|
27 |
|
| |
6 591 |
|
335 |
|
| 1 |
In 2011, Scancom Limited (MTN Ghana) concluded a transaction with American Tower Company (ATC), which involved the sale of MTN Ghana’s base transceiver station (BTS) sites to Ghana Tower InterCo B.V. which is an
associate of the group. Profit was eliminated to the extent of the group’s interest in the associate. Such unrealised
profit is realised by the group as the underlying assets are depreciated by the associate. |
| 2 |
In December 2017, MTN (Dubai) Limited (MTN Dubai) entered into individual agreements with various vendors of
Areeba Guinea S.A. (MTN Guinea-Conakry) and Lonestar Communications Corporation LLC (MTN Liberia), in terms
of which MTN Dubai purchased receivables (owing from MTN Guinea-Conakry and MTN Liberia to the respective
vendors), at a discounted price. The group has accounted for this transaction as a modification of a financial
liability, as the group has contractually agreed to modify the payment terms of the vendor liabilities. The group has
recognised the difference between the fair value of the modified financial liabilities and the carrying amount of the
original financial liabilities as a gain in profit or loss. |
Profit on exercise of exchange right of IHS
In January 2017, the group exchanged its 51% interest in Nigeria Tower InterCo B.V., the parent
company of INT Towers Limited (INT), the Nigerian telecom tower operator, for an additional
shareholding in IHS Holding Limited (IHS Group) (the transaction). The transaction, which
closed on 23 February 2017, has been accounted for as a disposal of the group’s equity-accounted
interest in INT and an acquisition of an additional investment in the IHS Group. The
net impact on profit before tax is R6 017 million, which was determined as the difference
between the fair value of the new interest obtained and the carrying value of the equity-accounted
interest in INT and after recycling the applicable amount included in the
foreign currency translation reserve (FCTR) (note 8.2) to the income statement. This resulted
in a decrease of R4 452 million in investments in associates (note 9.2) and an increase of
R13 767 million in available-for-sale investments (note 7.2).
The transaction had no tax impact.
|
