Ihs Holding Limited · NYSE:IHS
Ihs — Q1 2022 Earnings Presentation
30 slides from Ihs's earnings presentation, May 17, 2022
Slide 1: 1Q 2022 Earnings Results
1Q 2022 Earnings Results May 17, 2022
Slide 2: Disclaimer
DISCLAIMER Forward-Looking Information This presentation contains forward-looking statements. We intend such forward-looking statements to be covered by relevant safe harbor provisions for forward-looking statements (or their equivalent) of any applicable jurisdiction, including those contained in S
Slide 3: Presenting Today
PRESENTING TODAY SAM DARW ISH STEVE HOW DEN COLBY SYNESAEL Chairman and CEO Executive Vice President and Senior Vice President of Chief Financial Officer Communications 3
Slide 4: IHS Growth Strategy
IHS GROWTH STRATEGY REVENUE In US$M 1,580 (5) 1,403 24 Revenue 1,168 1,231 CAGR 2017 - 2021 1,107 +9.3% Capitalize on significant growth Organic Revenue opportunities in existing markets CAGR 2017 - 2021 +18.2% Optimize utilization of existing assets 2017A 2018A 2019A 2020A 2021A Consolidate t
Slide 5: 1Q22 Performance and Recent Developments
1Q22 PERFORMANCE AND RECENT DEVELOPMENTS REVENUE In US$M 1Q22 Revenue Growth Y/Y 446 402 401 416 +23.4% 362 24 (3) Constructed 203 towers, added 1Q22 Organic 3,229 new tenants and added Revenue Growth Y/Y 1,393 new lease amendments in 378 +21.5% 1Q22 1Q21 2Q21 3Q21 4Q21 1Q22 Revenue of $446M gro
Slide 6: IHS Group Snapshot
IHS GROUP SNAPSHOT 3rd Largest Independent Multinational 38,975 TowerCo Globally On Pro Forma Tower Count (1) Pro Forma towers on 3 Continents (1) (4) 219,226 16,856 6,786 102,712 (4) Nigeria Brazil 38,975 (1) (4) 36,017 ~5,700 (2) 2,690 ~5,700 South Africa Côte d’Ivoire 2,243 1,771 Cameroon Zambia
Slide 7: Strategic Update
STRATEGIC UPDATE GTS SP5 Portfolio – Closed March 17, 2022 MTN South Africa – Expected to close in 2Q 2022 (1) • Acquired GTS SP5 tower portfolio company in Brazil with 2,115 • Agreement to acquire MTN’s tower portfolio of approx. 5,700 towers with a nationwide footprint in 25 states towers and to p
Slide 8: LATAM Overview
LATAM OVERVIEW IHS LATAM 3rd largest tower operator in Brazil with 6,786 towers as of 1Q22 Colombia: 228 towers Over 300 employees in the region including I-Systems, with regional HQ in São Paulo Peru: Revenue grew 33.0% Y/Y 51 towers organically and annualized pro forma 1Q22 Adjusted EBIT
Slide 9: Sustainability Is Our Business Model
SUSTAINABILITY IS OUR BUSINESS MODEL SUSTAINABILITY INITIATIVES IN 1Q22 OUR STRATEGY Ethics & Governance IHS Nigeria joined UNICEF Nigeria for their Learning Passport Four-pillar Strategy: launch in Abuja. The Passport will provide on and offline Ethics and governance learning to 12 million chil
Slide 10: Consolidated Results Snapshot
CONSOLIDATED RESULTS SNAPSHOT 1Q21 1Q22 Y/Y Towers (#) 29,271 33,275 13.7% Tenants (#) 44,233 49,643 12.2% Colocation Rate 1.51x 1.49x (0.02x) Lease Amendments (#) 20,387 28,517 39.9% In US$M, unless stated Revenue 362 446 23.4% (1) Adjusted EBITDA 215 245 13.9% (1) Adjusted EBITDA Margin 59.5% 54.9
Slide 11: 1Q22 Consolidated Revenue Walk
1Q22 CONSOLIDATED REVENUE WALK 1Q REVENUE In US$M Growth +$84M or +23.4% (1) Inorganic Growth +5.3% Organic Growth +$78M or +21.5% (12) 446 19 28 9 6 6 12 17 362 +4.7% +3.3% +1.6% +1.7% +2.4% +7.7% +5.3% (3.4%) (2) 1Q21 Revenue CPI FX Resets New Sites New New Lease Other Inorganic FX 1Q22 Revenue Es
Slide 12: Segment 1Q22 Performance Highlights
SEGMENT 1Q22 PERFORMANCE HIGHLIGHTS Revenue & Adjusted EBITDA (1) In US$M 1Q21 1Q22 Y/Y Towers 16,612 16,856 1.5% Tenants 24,628 25,690 4.3% Lease Amendments 19,432 27,743 42.8% Nigeria Revenue 261 321 22.7% (1) Adjusted EBITDA 180 203 12.8% Margin % 68.9% 63.3% (560 Bps) Towers 7,631 7,930 3.9% Ten
Slide 13: Towers & Tenants
TOWERS & TENANTS TOWERS TOWERS BUILT In ‘000s 33.3 30.2 30.5 31.0 439 29.3 1.4 1.2 1.2 1.4 39 1.2 7.1 3.9 4.6 4.8 4.9 315 320 105 274 8 7.6 7.8 7.9 7.9 7.9 19 161 203 175 159 23 41 16.6 16.5 16.6 16.9 16.9 39 276 39 7 39 108 115 98 100 1Q21 2Q21 3Q21 4Q21 1Q22 1Q21 2Q21 3Q21 4Q21 1Q22 Nigeria SSA La
Slide 14: Consolidated Revenue and Adjusted EBITDA
CONSOLIDATED REVENUE AND ADJUSTED EBITDA REVENUE Reported (4) +8.7% +21.2% +8.7% +12.1% +23.4% Growth Y/Y Organic Growth Y/Y +14.6% +24.4% +11.8% (4) +14.5% +21.5% +23.4% In US$M 446 362 402 401 416 8 31 9 1Q22 Revenue Growth Rate Y/Y 14 7 15 7 20 11 7 88 86 84 (2) 89 83 24 • 1Q22 revenue growth +23
Slide 15: Recurring Levered Free Cash Flow and Capex
RECURRING LEVERED FREE CASH FLOW AND CAPEX RECURRING LEVERED FREE CASH FLOW (1) In US$M 63.0% 40.4% $87M (2) 35.6% 32.9% 173 33.7% 1Q22 Recurring Levered Free 61 (2) Cash Flow (1) 88 87 71 74 112 • 1Q22 RLFCF (1) growth +23.0% Y/Y 1Q21 2Q21 3Q21 4Q21 1Q22 • 2021 Bond interest profile of $56M paid in
Slide 16: Debt and Other Matters
DEBT AND OTHER MATTERS As of December As of March 31, 31, 2021 2022 In US$M 8.000% Senior Notes due 2027 940 940 2.5x 5.625% Senior Notes due 2026 500 500 6.250% Senior Notes due 2028 500 500 Nigeria Senior Credit Facilities 381 365 Consolidated Net Leverage (4) as of Other Indebtedness (2) 665 756
Slide 17: FY 2022 Guidance
FY 2022 GUIDANCE Key Points FY 2022 GUIDANCE Metrics Current Range Previous Range • 2021 non-recurring items: • Revenue: $24M (3) Revenue $1,875M – $1,895M $1,795M – $1,815M • Adjusted EBITDA (4) & RLFCF (5): $61M (6) • Revenue mid-point of $1,885M Adjusted EBITDA (1) $1,005M – $1,025M $960M – $980M
Slide 18: FY 2022 Key Assumptions and Sensitivities
FY 2022 KEY ASSUMPTIONS & SENSITIVITIES FY 2022 Key Assumptions • Oil at $120 USD/bbl (Q2 – Q4) FY 2022 SENSITIVITIES • Key Currencies FY22 average rates • USD:NGN = 432 • USD:BRL = 5.21 • USD:EUR = 0.90 Oil increase/ decrease of $5/bbl ~($7M)/+$7M Adjusted EBITDA (1)(2) • USD:ZAR = 15.95 (3) • FY22
Slide 19: FX Overview
FX OVERVIEW 1Q22 REVENUE BY REPORTING CURRENCY KWD FY22 Currency BRL RWF 4% 2% 3% ZMW 4% Assumptions EUR 13% (1) • Currencies FY22 average rates NGN • USD:NGN = 432 74% • USD:BRL = 5.21 • USD:EUR = 0.90 • USD:ZMW = 18.33 • USD:RWF = 1,032 1Q22 REVENUE BY LINKED CONTRACT SPLIT • USD:KWD = 0.30 • USD:
Slide 20: Oil Impact on Our Business
OIL IMPACT ON OUR BUSINESS (1) POWER SOLUTION AS AT 31 DEC 21 Grid / Solar / other 7% Grid Oil Impact connectivity and back up generator Hybrid • Since grid power is either unavailable or 24% 42% unreliable in most of the African locations where our Towers are located (particularly Nigeria), we prov
Slide 21: Appendix
Appendix MHS | 2:
Slide 22: IHS Market Data
IHS MARKET DATA Pro Forma Market Market Core # out of # Towers (1) Position (2) (3) Share (2) (3) Tenants Major MNOs (4) Nigeria 16,856 1 65% 3 out of 4 South Africa (5) ~5,700 1 39% 2 out of 4 CIV 2,690 1 100% 2 out of 3 Cameroon 2,243 1 100% 2 out of 3 Zambia 1,771 1 100% 2 out of 3 Rwanda 1,226 1
Slide 23: Attractive Markets Well Suited for Organic Growth
ATTRACTIVE MARKETS WELL SUITED FOR ORGANIC GROWTH POPULATION (MILLION PEOPLE) MOBILE PENETRATION Growth % 2020 – 2025E Change 2020 – 2025E +8% +13% +6% (4) +5% 812 236 114% 755 101% 209 109% 96% 2020 2025E 2020 2025E 2020 2025E 2020 2025E All IHS Markets (1) Nigeria All IHS Markets (2) Nigeria 4G AN
Slide 24: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION Reconciliation from audited (loss)/profit for the period to Adjusted EBITDA 3-month period ended Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, 2021 2021 2021 2021 2022 $'000 $'000 $'000 $'000 $'000 (Loss)/profit (29,053) 105,659 (30,447) (72,280) 16,916 Income tax expense 14
Slide 25: Recurring Levered Free Cash Flow Reconciliation
RECURRING LEVERED FREE CASH FLOW RECONCILIATION Reconciliation of cash flows from operating activities for the 3-month period ended period to Recurring Levered Free Cash Flow Mar 31, Jun 30, Sep 30, Dec 31, Mar 31, 2021 2021 2021 2021 2022 $'000 $'000 $'000 $'000 $'000 Cash from operations 201,586 1
Slide 26: Currency Overview
CURRENCY OVERVIEW Average Period End Spot Currency 2020A 1Q21 2Q21 3Q21 4Q21 1Q22 2020A 1Q21 2Q21 3Q21 4Q21 1Q22 Nigeria (Naira) – USD:NGN NAFEX 382 403 411 412 415 417 410 409 411 415 435 417 European Union (Euro) – USD:EUR 0.88 0.83 0.83 0.85 0.87 0.89 0.82 0.85 0.84 0.86 0.88 0.90 Zambia (Kwacha)
Slide 27: Glossary of Terms
GLOSSARY OF TERMS Adjusted EBITDA, Adjusted EBITDA margin and other non-IFRS financial measures are used by Group management to monitor the underlying performance of the business and the operations. Adjusted EBITDA, Adjusted EBITDA margin and other non-IFRS financial measures are used by different c
Slide 28: Glossary of Terms
GLOSSARY OF TERMS Inorganic Revenue: Inorganic revenue captures the impact on revenue from existing Tenants of new tower portfolios or businesses that we have acquired since the beginning of the prior period (except as described in the organic revenue). Where tower portfolios or businesses were acqu
Slide 29: Glossary of Terms
GLOSSARY OF TERMS Subsidiary Guarantors: IHS Netherlands NG1 B.V., IHS Netherlands NG2 B.V., IHS Nigeria Limited, IHS Towers NG Limited, Nigeria Tower Interco B.V. and INT Towers Limited and any other person that executes a supplemental indenture in accordance with the provisions of this senior note
Slide 30: Towers of strength
Towers of strength instowers.com