Helios Towers PLC · LSE:HTWS
Helios Towers — Q1 2021 Earnings Presentation
32 slides from Helios Towers's earnings presentation, May 20, 2021
Slide 1: Q1 2021 Results
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Slide 2: Helios Towers team today
Helios Towers team today Tom Greenwood Kash Pandya Manjit Dhillon Chief Operating Chief Executive Chief Financial Officer Officer Officer Helios Towers plc 2
Slide 3: Agenda
Agenda 1 Highlights – Kash Pandya, CEO 2 Strategic Updates – Tom Greenwood, COO 3 Financial Results – Manjit Dhillon, CFO 4 Q&A Helios Towers plc 3
Slide 4: Highlights
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Slide 5: A transformational period for the Group
A transformational period for the Group Announced six transactions in six new markets over the last 12 months, which together with c.1k committed BTS, brings HT site count close to c.15k sites Markets Sites 11 c.15k 12k+ 8+ 5 c.7k Q3 19 2025 Q1 21 Q3 19 2025 Q1 21 (at IPO) Target PF (at IPO) Target
Slide 6: Q1 2021: Financial highlights
Q1 2021: Financial highlights SOLID YEAR-ON-YEAR +2% revenue growth from $101.8m in Q1 20 to $103.6m in Q1 21. REVENUE GROWTH +3% Adj. EBITDA from $54.0m in Q1 20 to $55.8m in Q1 21, with margin of 54%. YEAR-ON-YEAR -7% QoQ decline from Q4 20 reflects a catch-up payment for amendment ADJ. EBITDA GRO
Slide 7: Q1 2021: Steady tenancy growth with moderate quarter-on-quarter Adj. EBITDA decline
Q1 2021: Steady tenancy growth with moderate quarter-on-quarter Adj. EBITDA decline Tenancies Adj. EBITDA(1) Portfolio free cash flow(2) • Illustrates the core driver of business • Highlights growth and operational • Measures the unlevered free cash flow growth performance of our business generation
Slide 8: FY 2021: Sustainable Business Strategy update
FY 2021: Sustainable Business Strategy update Sustainable Business Report • Published inaugural Sustainable Business Report in March 2021 • Highlights progress against our integrated Q1 strategy that supports advancing the UN 2021 SDGs(1) • Aligned to GRI(2) and SASB(3) reporting frameworks. Detaile
Slide 9: Q1 2021: Recent developments
Q1 2021: Recent developments Executing inorganic growth Operational excellence Closing of Free Senegal Airtel acquisition Omantel tower in our markets tower portfolio acquisition agreements Portfolio acquisition Delivered our 4th consecutive On 18 May closed the Signed agreements with Airtel On 11 M
Slide 10: Strategic Highlights
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Slide 11: Omantel transaction overview
Omantel transaction overview Signed agreement to acquire passive infrastructure assets, representing 2,890 sites, from Omantel for an upfront cash consideration of $575m. Represents an enterprise value of $615m including the Group’s estimate of transaction costs and capitalised ground leases TRANSAC
Slide 12: Oman aligns to our target market criteria
Oman aligns to our target market criteria Helios Towers Acquisition Criteria Omantel Tower Portfolio Acquisition Emerging market ✓ 3% GDP CAGR forecast (2020 – 2026) Population of >10m - Population of 5m with 2% annual growth forecast to 2026 3 Operators: Omantel and Ooredoo, with Vodafone partner 3
Slide 13: Successfully executing growth strategy
Successfully executing growth strategy Pro forma characteristics HT presence Q1 2021 PF Q1 2021 Acquisitions(1) Executive HQ Dubai Markets 5 11 13,682 / Senegal Oman Chad Sites 7,358 14,697 (incl. committed BTS) Ghana LQA revenues DRC 414 c.600 Congo B ($m) Gabon LQA Adj. EBITDA 223 c.309 Tanzania (
Slide 14: Platform for successful integration
Platform for successful integration Well positioned for successful acquisition integration through regional CEO structure, dedicated launch teams and standardised 100-day plan Dedicated new market teams Acquisition integration timeline New In-country Group support MNO staff Q3 20 Q4 20 Q1 21 Q2 21 Q
Slide 15: Expansion driving further diversification
Expansion driving further diversification Sites Revenues ($m)(1) LQA Adjusted EBITDA ($m)(1,2) 13,682 day 1 / 7,358 414 c.600 223 c.309 14,697 incl. committed BTS 1,015 +45% +39% +100% 40 59 2,890 27 89 19 12 2 12 2 2,227 5 38 5 27 27 27 27 242 1,207 42 42 242 99 99 427 427 981 981 171 171 1,895 1,8
Slide 16: Strengthened business through increase in hard-currency Adj. EBITDA and customer diversification
Strengthened business through increase in hard-currency Adj. EBITDA and customer diversification across Tier 1 MNOs FY 2020 FY 2020 PF (Senegal, Airtel & Omantel acquisitions) Vodacom 13% 10% 19% Airtel 22% 28% 5% 10% Tigo 4% REVENUE BY 14% Orange 6% Free CUSTOMER 28% 10% MTN 22% 18% Omantel 13% 13%
Slide 17: Financial results
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Slide 18: Q1 2021: Continued tenancy growth and operational excellence
Q1 2021: Continued tenancy growth and operational excellence YoY QoQ In US$m, unless Q1 21 Q1 20 % change Q1 21 Q4 20 % change otherwise stated Revenue 104 102 +2% 104 106 -2% Adj. EBITDA(1) 56 54 +3% 56 60 -7% LQA Adj. EBITDA(2) 223 216 +3% 223 240 -7% Adj. EBITDA margin (%) 54% 53% +1ppt 54% 57% -
Slide 19: Q1 2021: Steady growth in sites and tenancies
Q1 2021: Steady growth in sites and tenancies Evolution of sites portfolio Evolution of tenants Evolution of tenancy ratio +5% +7% +0.04x 0% 0% +0.01x 7,356 7,358 15,656 15,732 6,991 242 14,677 404 419 236 617 620 123 426 427 565 218 384 1,914 1,929 964 978 981 1,891 4,096 4,132 1,853 1,895 1,895 3,
Slide 20: Q1 2021: Year-on-year growth in revenues & Adjusted EBITDA
Q1 2021: Year-on-year growth in revenues & Adjusted EBITDA with moderate quarter-on-quarter declines Revenue ($m) Adj. EBITDA ($m) Adj. EBITDA margin (%) +2% +3% +1 ppt -7% -2% -3 ppt 106 104 60 56 57% 102 54 53% 54% Q1 20 Q4 20 Q1 21 Q1 20 Q4 20 Q1 21 Q1 20 Q4 20 Q1 21 • Q1 21 revenue increased +2%
Slide 21: Q1 2021: Quarter-on-quarter Adj. EBITDA movement
Q1 2021: Quarter-on-quarter Adj. EBITDA movement Adj. EBITDA ($m) (3) (1) Decrease in DRC revenues Update to DRC licence fee in reflects catch-up payment 2021, increasing to 3% of local for amendment revenues in revenues. Q4 2020 with underlying 60 growth continuing as expected. Increase is reflecte
Slide 22: Strong currency hedged business underpinned by long-term contracts
Strong currency hedged business underpinned by long- term contracts with blue-chip mobile network operators Q1 2021 revenue breakdown by customer Q1 2021 revenue breakdown by FX Other 1% 99% LCY (CPI) 22% 60% Other revenues from Multinational hard currency MNOs(2) multinational 11% MNOs LCY (Power)
Slide 23: FY 2021: Over $1bn investment targeted
FY 2021: Over $1bn investment targeted Capex breakdown ($m) Commentary Q1 21 capex of $27m, in line with expectations. c.$1,010 - Existing markets c.$900m $1,040m FY 21 capex guidance unchanged at $110 - $140m in Anticipate c.$900m capital expenditure our existing markets, of which $20 - $25m is
Slide 24: Summary of financial debt
Summary of financial debt Debt KPIs Gross and net leverage +2.1x / 0.0x ($m) Q2 20 Q3 20 Q4 20 Q1 21 6.0x 4.9x 4.7x Cash & cash equivalents 213 466 429 670 3.9x 3.0x 2.9x 2.9x 3.0x Bond 750 975 975 975 Convertible bond(1) - - - 205 SA loan facility 11 11 13 12 Q2 20 Q3 20 Q4 20 Q1 21 (2) Lease oblig
Slide 25: Q1 2021: Key takeaways
Q1 2021: Key takeaways – Significant momentum; Organic, Inorganic, ESG 1 Transformational period - announced acquisitions establishing Helios Towers as the most diverse tower company across the Middle-East and Africa 2 Delivering on our 5-year vision, well-ahead of plan 3 Full year outlook unchanged
Slide 26: Q&A
Q&A KY peur MA ‘ % % % LN BAY AY & x % x
Slide 27: Appendix
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Slide 28: Helios Towers market overview
Helios Towers market overview Multinational MNOs PoS PoS Growth Oman- Oore- Mobile Towers Additions(2) CAGR(2) Airtel Africell MTN Orange Axian(3) Voda Viettel tel doo Penetration(1) Available(2) (2020 – (2020 – 2026E) 2026E) Tanzania 41% 2.0k 5.5k 6% DRC 40% 1.2k 5.7k 11% Ghana
Slide 29: Strong operational execution and resilient business model offset COVID-19 impact
Strong operational execution and resilient business model drive financial performance and offset minimal COVID-19 impact Commentary Impact Assessment Change since Q4 20 • Return to work protocols are being Workforce & • Field operations and home working • Minimal reviewed with employee wellbeing at
Slide 30: Q1 2021: Year-on-year portfolio free cash flow movement
Q1 2021: Year-on-year portfolio free cash flow movement Portfolio free cash flow ($m) 2 (4) (0) (7) 3% year-on-year Adj. EBITDA growth driven Reflects quarterly variation by tenancy additions in capital additions, with YoY increase in cash and operational Q1 20 lower than typical taxes driven by tim
Slide 31: Guidance and outlook unchanged for existing markets
Guidance and outlook unchanged for existing markets, with further growth expected through announced acquisitions • Guidance unchanged, targeting 1-1.5k per year over the medium term. Tenancies • Of which 50% BTS gradually reducing to 25% BTS over the medium term. Lease rate • Decrease of c.3% in 202
Slide 32: Disclaimer
Disclaimer This presentation does not constitute an offering of securities or otherwise constitute an invitation or inducement to any person to underwrite, subscribe for or otherwise acquire or dispose of securities in Helios Towers plc (the "Company") or any other member of the Helios Towers group