Helios Towers Plc · LSE:HTWS
Helios Towers — Q3 2024 Earnings Presentation
27 slides from Helios Towers's earnings presentation, Nov 7, 2024
Slide 1: Q3 2024 Results
Q3 2024 Results 7 November 2024
Slide 2: Helios Towers Team
HELIOS TOWERS TEAM Manjit Dhillon Tom Greenwood Chris Baker-Sams Chief Financial Officer Chief Executive Officer Head of Strategic Finance and Investor Relations 2 Helios Towers Q3 2024 Results
Slide 3: Agenda
Agenda 1. Highlights 2. Financial results 3. Q&A Dar es Salaam, Tanzania
Slide 4: Highlights
Highlights Odzala National Park, Congo Brazzaville
Slide 5: Highlights
HIGHLIGHTS 1 2 3 Tenancy additions ahead Continued Adj. EBITDA FY 24 guidance of expectations growth and ROIC expansion updated • +2,096 YTD tenancy additions • +16% YoY YTD Adj. EBITDA growth • >2,400 tenancy additions (+2,397 YoY), driven by Oman and (Prior: 1,900 – 2,100) • +1ppt YoY ROIC expansi
Slide 6: KPIs expected to meet or exceed high-end of prior guidance
KPIS EXPECTED TO MEET OR EXCEED HIGH-END OF PRIOR GUIDANCE Organic tenancy additions (#) Adj. EBITDA (US$m) PFCF and ROIC (US$m/ %) Tenancy ratio Adj. EBITDA margin 1.81x 1.91x 2.04x 50% 51% 53% 13.0% Organic(1): +$46m +c.$50m YTD Inorganic: +$41m - 12.0% c.420 c.290 2,433 >2,400 Prior guidance: 10.
Slide 7: Tenancy ratio expansion driving ROIC and free cash flow growth
TENANCY RATIO EXPANSION DRIVING ROIC AND FREE CASH FLOW GROWTH Our target: Tenancy 2.13x ratio 2.04x 1.96x 1.91x ROIC 14.5% 1.81x 13.0% 11.8% 12.0% 10.3% New market Senegal Malawi acquisitions Madagascar Oman 14k 14k 14k Sites 10k 7k FY 20 FY 21 FY 22 FY 23 Q3 24 YTD FY 24 - 26 Free cash flow(1) ($7
Slide 8: Continued delivery with FY 2025 targets in accordance with capital allocation framework
CONTINUED DELIVERY WITH FY 2025 TARGETS IN ACCORDANCE WITH OUR DISCIPLINED CAPITAL ALLOCATION FRAMEWORK Optimised organic Adj. EBITDA growth, ROIC expansion and deleveraging FY 23 FY 24 FY 25 Actual Guidance Targets 1 Optimised organic investments: Tenancy ratio 1.9x >2.0x >2.1x Organic Adj. EBITDA
Slide 9: Financial results
Financial results Ituri, DRC
Slide 10: Operational & financial highlights
OPERATIONAL & FINANCIAL HIGHLIGHTS YoY YoY In US$m, unless otherwise stated Q3 24 YTD Q3 23 YTD Change Q3 24 Q3 23 Change Sites (#) 14,247 14,024 +2% 14,247 14,024 +2% Tenancies (#) 29,021 26,624 +9% 29,021 26,624 +9% Tenancy ratio (x) 2.04x 1.90x +0.14x 2.04x 1.90x +0.14x Revenue 585 534 +10% 195 1
Slide 11: Q3 2024: Consistent and strong tenancy additions driven by structural growth
Q3 2024: CONSISTENT AND STRONG TENANCY ADDITIONS DRIVEN BY STRUCTURAL GROWTH, LEADING MARKET POSITIONS AND CUSTOMER SERVICE EXCELLENCE Sites Tenancies Tenancy ratio +2% +9% +0.14x 14,024 14,247 29,021 2.04x 26,624 1.90x 2,528 2,547 4,132 3,304 5,085 5,216 10,765 11,377 6,411 6,484 12,555 13,512 Q3 2
Slide 12: Q3 2024: Tenancy additions delivering +11% Adjusted EBITDA growth
Q3 2024: TENANCY ADDITIONS DELIVERING +11% ADJUSTED EBITDA GROWTH Revenue (US$m) Adj. EBITDA (US$m) Adj. EBITDA margin (%) +6% +11% +2ppt 106 195 95 184 12 17 9 14 99 44 52 91 52% 54% 78 79 52 51 -9 -9 Q3 23 Q3 24 Q3 23 Q3 24 Q3 23 Q3 24 • YoY growth (+6%) driven by tenancy additions • YoY growth (+
Slide 13: Adj. EBITDA growth highly correlated to tenancy additions and resilient to FX, CPI
ADJ. EBITDA GROWTH IS HIGHLY CORRELATED TO TENANCY ADDITIONS AND RESILIENT TO FX, CPI AND POWER PRICE MOVEMENTS Q3 24 YoY revenue walkthrough(1,2) Q3 24 YoY Adj. EBITDA walkthrough(1) (US$m) (US$m) +6% +11% 6 (8) 5 (3) 11 2 10 0 Fx impact mitigated through Driven by Fx movements 71% hard-currency in
Slide 14: Capex is tightly controlled and focused on accretive opportunities
CAPEX IS TIGHTLY CONTROLLED AND FOCUSED ON ACCRETIVE OPPORTUNITIES FY 24 Q3 24 Q3 24 Capex breakdown (US$m) FY 23 updated YTD • Q3 24 YTD capex of $113m, of which guidance $31m is non-discretionary Acquisitions 20 5 FY 24 guidance Growth 113 59 • Capex guidance narrowed to $170m - Upgrade 35 18 $180
Slide 15: Strong financial position with largely fixed rate debt and no near-term maturities
STRONG FINANCIAL POSITION WITH LARGELY FIXED RATE DEBT AND NO NEAR-TERM MATURITIES Debt KPIs (US$m) Q3 23 Q2 24 Q3 24 Commentary Cash & cash equivalents 151 145 115 • Net leverage decreased by 0.3x YoY to Bond (Dec-25) 975 850 850 4.2x; target below 4.0x in FY 24 Convertible bond(1) (Mar-27) 247 247
Slide 16: FY 2024 guidance updated
FY 2024 GUIDANCE UPDATED FY 23 FY 24 FY 24 YoY Actual Prior guidance(1) Updated guidance(1) Growth(3) Organic tenancy additions +2,433 +1,900 - 2,100 >2,400 >9% Adj. EBITDA $370m $410m - $420m c.$420m c.14% PFCF $268m $280m - $290m c.$290m c.8% Capex $203m $155m - $190m $170m - $180m (11%) - (16%) (
Slide 17: Key takeaways
KEY TAKEAWAYS ✓ ✓ ✓ ✓ Consistent and Continued Adj. FY 24 KPIs expected Low double-digit strong tenancy EBITDA growth and to meet or exceed Adj. EBITDA growth, additions ROIC expansion high-end of prior ROIC expansion and (+2,096 YTD/ guidance deleveraging +2,397 YoY) targeted in FY 25 17 Helios Tow
Slide 18: Q&A Thank you
Q&A Thank you Jërëjëf Medaase Zikomo Merci Matondi Asante Misaotra Shukranًشكرا Siyabonga Matondo Dakar, Senegal
Slide 19: Investor Relations
INVESTOR RELATIONS IR Contact Upcoming IR events Event 13 November New Street Research investor call Chris Baker-Sams Head of Strategic Finance and Investor Relations investorrelations@heliostowers.com Morgan Stanley European Technology, Media & Telecom 20 to 21 November Conference 12 December JP Mo
Slide 20: Appendix
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Slide 21: Market overview: macro and industry snapshot
MARKET OVERVIEW: MACRO AND INDUSTRY SNAPSHOT Mobile 4G/ 5G PoS Growth CAGR(3) Towers held by Credit ratings # MNOs(1) Credit ratings(5) Penetration(2) penetration(2) (2023 – 2028) MNOs(4) momentum(6) Tanzania 4 48% 20% 6% 0.7k B1(St)/NR/B+(St) Senegal 3 46% 36% 6% 2.6k B1(review)/B+(-ve)/NR Malawi 2
Slide 22: Q3 2024: Sites and tenancies
Q3 2024: SITES AND TENANCIES Population Sites Tenancies Tenancy ratio coverage Q3 Q2 Q3 Q3 Q2 Q3 Q3 YoY QoQ YoY QoQ Q3 23 Q2 24 Q3 24 YoY QoQ 23 24 24 23 24 24 24 Tanzania 4,188 4,176 4,207 19 31 9,648 10,308 10,358 710 50 2.30x 2.47x 2.46x 0.16x (0.01x) 42m Senegal 1,428 1,458 1,459 31 1 1,554 1,60
Slide 23: Consistent progression in Adjusted EBITDA growth
CONSISTENT PROGRESSION IN ADJUSTED EBITDA GROWTH 423 416 403 409 (Annualised, US$m) 382 356 339 303 278 283 262 267 240 243 230 234 220 223 210 215 216 195 201 186 176 181 164 168 148 133 138 126 127 83 85 60 63 50 42 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q
Slide 24: Diversified business underpinned by long-term contracts with blue-chip MNOs
DIVERSIFIED BUSINESS UNDERPINNED BY LONG-TERM CONTRACTS WITH BLUE-CHIP MNOS Diverse, quality customer base Robust hard-currency revenues Geographically diverse sites Q3 24 revenue breakdown by customer Q3 24 revenue breakdown by FX Q3 24 site breakdown by segment 2% Largest customers 18% 16% Airtel
Slide 25: Sustainable business strategy update
SUSTAINABLE BUSINESS STRATEGY UPDATE Mgmt. Impact KPI comp(1) FY 23 Q3 24 FY 26 • Continued progress against our Strategy • Power uptime reaching record levels Developing talent % staff trained in Lean Six Sigma Enabler 53% ✓ 56% 70% • Population coverage +5m YTD Local teams % local employees Enable
Slide 26: Leading ESG credentials
LEADING ESG CREDENTIALS Third ‘AAA’ ESG rating from MSCI, Mar 24 FTSE4Good Index inclusion, Jun 24 Scored B, Feb 24 Gold rating, Feb 24 (the highest possible score from MSCI) (for a third consecutive year) (2023 rating reaffirmed) (rated top 5% of telecoms industry) ESG Risk Rating of 16.7 (Low Risk
Slide 27: 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