MTN, Africa's largest cellphone network operator, posted a 21% rise in first-half profit yesterday and paid a mid-year dividend for the first time, in line with a new strategy that no longer emphasises growth by acquisitions.

Though built on aggressive acquisitions, MTN has said it will now concentrate on paying out more to shareholders because it sees fewer potential targets in emerging-market telecoms.

MTN, the largest company with a primary listing in Johannesburg, said it would pay an interim dividend of 151c a share, bringing its payout ratio to 40% of full-year earnings.

"This interim dividend is a change in the company's policy around dividends," said David Lerche, a telecoms analyst at Avior Research, Johannesburg.

"It shows they want to distribute more cash to their shareholders."

Though MTN has operations in 21 countries, most of its revenue comes from South Africa, Ghana, Nigeria and Iran.

Analysts say it still needs to bulk up in other markets, especially because of increased competition from India's Bharti Airtel.

Bharti, which acquired the African assets of Kuwait's Zain this year, said it will invest at least $1.1-billion in its sub-Saharan business.

An attempt by Bharti to acquire the Algerian unit of Egypt's Orascom Telecom was thwarted in June by Algeria's government, which wanted the company for itself.

MTN said adjusted headline earnings a share totalled 438.6c in the six months to the end of June, compared with 363.8c in the corresponding period a year earlier.

Revenue fell 2.2% to R56-billion, hit by a stronger rand. Total subscribers rose 11.4% to 129.2million.

MTN said its capital expenditure in the first half dropped by R7-billion, to R8.5-billion.

The stock rose as much as 2% following the release of the results.

Shares of MTN are little changed so far this year, but have outperformed the Johannesburg Stock Exchange's Top-40 index.

The company, which was the main sponsor of the 2010 soccer World Cup, had its reputation blemished by technical glitches at the JSE, whose network it manages.

The JSE was twice forced to delay trading last month, the second time for nearly six hours, because of problems with its international network connections.

The JSE's chief executive said MTN would compensate the bourse, though the amount would be "very tiny".