Millicom International Cellular S.a. · NASDAQ:TIGO
Millicom International Cellular — Q2 2023 Earnings Presentation
28 slides from Millicom International Cellular's earnings presentation, Jul 27, 2023
Slide 1: Q2 2023 Earnings Presentation
Q2 2023 Earnings Presentation
Slide 2: Safe Harbor
Safe Harbor Cautionary Language Concerning Forward-Looking Statements Statements included herein that are not historical facts, including without limitation statements concerning future strategy, plans, objectives, expectations and intentions, projected financial results, liquidity, growth and prosp
Slide 3: Non-IFRS measures
Non-IFRS measures This presentation contains financial measures not prepared in accordance with IFRS. These measures are referred to as “non-IFRS” measures and include: non-IFRS service revenue, non-IFRS EBITDA, and non-IFRS Capex, among others defined below. Annual growth rates for these non-IFRS m
Slide 4: Q2 Highlights
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Slide 5: Q2 Highlights
Q2 23 Highlights Service Revenue1 +1.9% organically Postpaid and B2B momentum sustained Home discipline Advancing Colombia and Guatemala Executing Project Everest 1) Group financial information does not include Honduras, which is not consolidated. Non-IFRS measure. Please refer to the non-IFRS discl
Slide 6: Sustained service revenue growth
Sustained service revenue growth All business units growing Strong performance across countries Q2 23 Service Revenue organic growth1 Q2 23 Service Revenue local currency growth1 1.9% Q2 23 organic service 6.1% 7.5% 9.6% 4.9% 5.0% revenue growth1 +20.3% 4.1% in USD 2.4% 1.7% 0.2% -1.6% -2.9% -2.9% H
Slide 7: B2B continues strong momentum
B2B continues strong momentum B2B digital services driving growth 29% B2B Service Revenue ($m) and YoY Organic Growth (%)1 B2B Organic Growth % Digital2 as % of B2B Service Revenue 6.1% 6.1% Q2 23 Digital2 organic 6.0% 5.7% service revenue growth1 5.2% 5.1% 19.5% Key client wins 18.6% 17.7% 17.9% 16
Slide 8: Postpaid sustaining strong momentum
Postpaid sustaining strong momentum Migration to postpaid continues… …driving revenue growth Postpaid customers (m) Postpaid constant currency quarterly service revenue1 189k +16.4% Organic CAGR 8.6% Q2 23 postpaid net adds Q2 23 postpaid organic 6.7 service revenue growth1 6.2 +6.7% Organic CAGR 4.
Slide 9: Home discipline
Home discipline Slower growth from large countries Initiatives Home service revenue size and Q2 23 Home organic service revenue growth1 Circle size represents market share % Colombia • Eliminated greenfield rollout • Increased installation fees High Nicaragua Bolivia & Colombia represent • Rationali
Slide 10: Guatemala: Investing to protect leadership
Guatemala: Investing to protect leadership Mobile leadership maintained Rebalanced spectrum positions Customers Nationwide Spectrum (2xMhz) Spectrum Prepaid Postpaid Low Band High Band 11.5 11.8 11.7 10.9 10.6 New 2.6 GHz New 2.6GHz Spectrum Spectrum Q2 Q2 Q2 Q2 Q2 Claro Tigo 19 20 21 22 23 ▪ We con
Slide 11: Colombia progress
Colombia progress Our plan to improve profitability MOBILE FOCUS EFFICIENCIES NETWORK SHARING ▪ Mobile driving results ▪ Steady margin expansion since Q3 21 ▪ Signed MOU with Telefonica ▪ Postpaid migration fueling growth ▪ Everest restructuring costs of $8m YTD ▪ Spectrum optimization ▪ Six consecu
Slide 12: ESG commitment continues
ESG commitment continues Reports and Policies Rule of Law Pledge Programs advancing 769k 427k Trained children (Total) Trained teachers (Total) Conéctate Seguro Program Maestr@s Conectad@s 12
Slide 13: Q2 2023 Financial Review
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Slide 14: Macro update
Macro update All business units and most countries growing Inflation receding, Colombia remains elevated YoY CPI inflation % 14 13 12 12.1% Colombia 11 10 9 8 7 6 5 4.6% Tigo Country 4 Average 3 3.0% US 2 1 0 12/20 03/21 06/21 09/21 12/21 03/22 06/22 09/22 12/22 03/23 06/23 Source: Bloomberg 14
Slide 15: Group Service Revenue
Group Service Revenue1 YoY Organic Service Revenue1 Growth Q2 22 – Q2 23, $m 1,315 +1.9% 1,291 1.9% Organic Service Revenue1 Growth Q2 22 FX Rebased Q2 22 Mobile Fixed Q2 23 1) Group financial information does not include Honduras, which is not consolidated. Non-IFRS measure. Please refer to the non
Slide 16: Q2 2023 Service Revenue by Country
Q2 2023 Service Revenue by Country1 Service revenue ($m), and YoY local currency growth2 Guatemala (26% of Group) Colombia (23% of Group) Panama (12% of Group) Bolivia (12% of Group) -1.6% +2.4% +4.1% -2.9% 335 302 161 150 Q2 22 Q2 23 Q2 22 Q2 23 Q2 22 Q2 23 Q2 22 Q2 23 Paraguay (11% of Group) El Sa
Slide 17: Group EBITDA
Group EBITDA 1 YoY Organic EBITDA1 Growth Q2 22 – Q2 23, $m Unusual items & investments 577 515 Q2 22 FX Rebased Everest Share-based Buyout Content, Legal Underlying Q2 23 EBITDA Restructuring Compensation Discussions TigoMoney Performance EBITDA (non-cash) and LATI 1) Group financial information do
Slide 18: Q2 2023 EBITDA by Country
Q2 2023 EBITDA by Country1 EBITDA2 ($m), and YoY local currency growth2 Guatemala (35% of Group) Colombia (16% of Group) Panama (13% of Group) Paraguay (11% of Group) +5.0% +1.5% +12.4% -7.7% -1.3% -4.7% +9.1% 199 91 73 62 Q2 22 Q2 23 Q2 22 Q2 23 Q2 22 Q2 23 Q2 22 Q2 23 29.5% 29.1% 47.4% 43.1% 43.3%
Slide 19: Project Everest Update
Project Everest Update Initiatives Progress Organizational restructuring Implementation costs of $21m YTD On track for >$100m run rate annual IT and services optimization savings by 2024 year-end Fixed Mobile convergence Expect ~$50m run rate annual savings by 2023 year-end Truck roll optimization N
Slide 20: Q2 2023 Leverage
Q2 2023 Leverage Group financial obligations1 ($m) Net Debt Net Financial Obligations +100 +101 6,083 7,009 7,110 5 5,983 24 71 1,026 1,027 5,983 6,083 Net debt* EFCF FX & Derivatives Others Net debt1 31-Mar-23 30-Jun-23 31-Mar-23 30-Jun-2023 Net Debt Leases Net debt to Group 3.18x 3.34x 3.23x 3.37x
Slide 21: Wrap Up
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Slide 22: Wrap up – H2 & 2024 Priorities
Wrap up – H2 & 2024 Priorities Operational Guatemala Colombia Value from efficiency Back to growth solutions infrastructure 22
Slide 23: Appendix
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Slide 24: Group Financial Highlights – Q2 2023
Group Financial Highlights – Q2 2023 Group Consolidated Financial Statements Selected P&L data Key Observations A •A Depreciation of currencies B C •B Lower handset sales partially offset by legal provision in Colombia •C Organizational restructuring costs, costs associated with buyout discussions,
Slide 25: Debt Maturity Schedule
Debt Maturity Schedule Q2 23 Average maturity 5.2 Years Average cost of debt 6.6% Telecel $503m 5.875% Cable 31s Comcel 29s Onda $808m $881m 28s $675m $600m 4.500% 5.125% $450m 6.250% 4.500% 5.125% SEK 26s 2.25bn $148m 6.625% 7.299%1 1) Fully swapped currency 25
Slide 26: Capital Structure
Capital Structure Financial obligation profile As of June 30, 2023 Fixed or Swapped Variable 80% 20% Local Other 42% 58% 5Y or more Less than 5Y 60% 40% Latam HQ 69% 31% Bonds Banks Leases 62% 25% 13% *Excluding Leases. El Salvador's official unit of currency is the U.S. dollar, while Panama uses th
Slide 27: Financial obligations by country
1 Financial obligations by country Honduras Guatemala: (not consolidated): Gross: $1,682m Gross: $413m Net: $1,544m Net: $382m Nicaragua: Leverage: 1.88x Leverage: 1.43x Gross: $268m Group: Net: $257m Gross: $7,762m El Salvador: Leverage: 2.30x Gross: $286m Net: $7,110m Net: $269m Of which Leases: L
Slide 28: Millicom Tigo – The Digital Lifestyle
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Millicom International Cellular — Q2 2023 Earnings Presentation on 6ix