REG - Helios Towers PLC - Q3 2024 Results

Helios TowersAnnouncement

07/11/2024 07:00

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RNS Number : 2682L  Helios Towers PLC  07 November 2024

HELIOS TOWERS plc

Unaudited trading update for the nine months and quarter ended 30 September
2024

 

+2,096 tenancy additions year-to-date

 

+16% year-on-year Adjusted EBITDA growth

 

FY 2024 financial guidance tightened upwards

 

London, 7 November 2024:  Helios Towers plc ("Helios Towers", "the Group" or
"the Company"), the independent

telecommunications infrastructure company, today announces results for the
nine months to 30 September 2024 ("YTD 2024").

 

                                        YTD 2024  YTD 2023  Change  Q3 2024  Q2 2024  Change
 Sites                                  14,247    14,024    +2%     14,247   14,185   +0.4%
 Tenancies                              29,021    26,624    +9%     29,021   28,574   +2%
 Tenancy ratio                          2.04x     1.90x     +0.14x  2.04x    2.01x    +0.03x
 Revenue (US$m)                         584.7     533.7     +10%    194.8    195.3    -
 Adjusted EBITDA (US$m)(1)              311.9     269.2     +16%    105.7    104.0    +2%
 Adjusted EBITDA margin(1)              53%       50%       +3ppt   54%      53%      +1ppt
 Operating profit (US$m)                190.6     112.6     +69%    58.3     65.0     -10%
 Portfolio free cash flow (US$m)(1)     217.6     197.1     +10%    75.6     72.1     +5%
 Cash generated from operations (US$m)  243.2     239.7     +1%     67.5     119.9    -44%
 Net debt (US$m)(1)                     1,790.8   1,729.9   +4%     1,790.8  1,758.9  +2%
 Net leverage(1,2)                      4.2x      4.5x      -0.3x   4.2x     4.2x     -

1 Alternative Performance Measures are described in our defined terms and
conventions.

2 Calculated as per the Senior Notes definition of net debt divided by
annualised Adjusted EBITDA.

 

Tom Greenwood, Chief Executive Officer, said:

 

"Our Q3 results reflect continued execution of our 2.2x by 2026 strategy, with
strong tenancy growth supported by our leading positions in structurally
high-growth markets. Accordingly, we have increased our FY 2024 guidance for
tenancy additions to over 2,400, and we now expect to deliver Adjusted EBITDA
and portfolio free cash flow at the high-end of our prior guidance ranges,
supporting our targeted net leverage reduction.

 

Looking forward to FY 2025, we expect further progress in our tenancy ratio
expansion strategy. Combined with our resilient business model and focus on
efficiencies through AI and digitalisation, we expect this to drive low
double-digit Adjusted EBITDA growth, continued ROIC expansion and further
deleveraging, supporting sustainable value creation for all our stakeholders."

 

Financial highlights

Financial performance driven by tenancy growth, underpinned by a base of
contracted revenues that feature CPI and power price protections

 

·     YTD 2024 revenue increased by 10% year-on-year to US$584.7m (YTD
2023: US$533.7m), driven by tenancy growth, particularly in Oman and Tanzania

o  Q3 2024 revenue was stable quarter-on-quarter at US$194.8m (Q2 2024:
US$195.3m)

 

·     YTD 2024 Adjusted EBITDA increased by 16% year-on-year to US$311.9m
(YTD 2023: US$269.2m), driven by tenancy growth

o  Q3 2024 Adjusted EBITDA increased by 2% quarter-on-quarter to US$105.7m
(Q2 2024: US$104.0m).

 

·     YTD 2024 Adjusted EBITDA margin increased 3ppt year-on-year to 53%
(YTD 2023: 50%), driven by +0.14x tenancy ratio expansion

o  Q3 2024 Adjusted EBITDA margin increased 1ppt quarter-on-quarter to 54%

 

·     YTD 2024 operating profit increased by 69% year-on-year to US$190.6m
(YTD 2023: US$112.6m), driven by growth in Adjusted EBITDA and lower
depreciation, following an update to our tower asset depreciation policy,
effective from 1 January 2024

o  Q3 2024 operating profit decreased by 10% quarter-on-quarter to US$58.3m
(Q2 2024: US$65.0m), primarily driven by asset write-offs reflecting site
consolidations that enhance operational efficiency

 

·     YTD 2024 portfolio free cash flow increased by 10% year-on-year to
US$217.6m (YTD 2023: US$197.1m), driven by Adjusted EBITDA growth partially
offset by timing of tax paid

o  Q3 2024 portfolio free cash flow increased by 5% quarter-on-quarter to
US$75.6m (Q2 2024: US$72.1m), driven by Adjusted EBITDA growth and timing of
lease liability payments

 

·     YTD 2024 cash generated from operations increased by 1% year-on-year
to US$243.2m (YTD 2023: US$239.7m), driven by Adjusted EBITDA growth partially
offset by working capital movements

o  Cash generated from operations decreased by 44% quarter-on-quarter to
US$67.5m (Q2 2024: US$119.9m), driven by Adjusted EBITDA growth offset by
working capital movements, largely related to timing of customer receipts

 

·     Net leverage decreased by 0.3x year-on-year to 4.2x (YTD 2023: 4.5x)
and was stable quarter-on-quarter (Q2 2024: 4.2x)

o  The Company continues to target net leverage below 4.0x in Q4 2024, driven
by Adjusted EBITDA growth and reduction in net debt from Q3 2024

 

·     Business underpinned by future contracted revenues of US$5.3bn(Q3
2023: US$5.5bn), of which 99.6% is from multinational MNOs, with an average
remaining initial life of 7.1 years (Q3 2023: 7.8 years)

 

Operational highlights

Structurally high-growth markets, leading market positions and customer
service focus supporting strong and consistent tenancy growth

 

·      Sites increased by 223 year-on-year to 14,247 (Q3 2023: 14,024)

o  Increased by 62 quarter-on-quarter

o  Increased by 150 year-to-date

 

·      Tenancies increased by 2,397 year-on-year to 29,021 (Q3 2023:
26,624)

o  Increased by 447 quarter-on-quarter

o  Increased by 2,096 year-to-date, driven by additions in Tanzania and Oman

 

·      Tenancy ratio increased by 0.14x year-on-year to 2.04x (Q3 2024:
1.90x)

o  Increased by 0.03x quarter-on-quarter

o  Increased by 0.13x year-to-date

 
Environmental, Social and Governance (ESG)

 

·     The Group has updated its climate action pledge and is targeting a 36% reduction(1) (previously 46%) in carbon intensity per tenant by 2030
o  The revised target reflects the addition of our four new markets(2) and increased fuel consumption in DRC resulting from significant tenancy growth

 

1          Target covers Scope 1 and 2 emissions and reflects change
from a 2020 baseline.

2          New markets refer to Senegal, Malawi, Madagascar and Oman,
which were closed across 2021 and 2022.

 

 

Outlook and guidance(1)

 

·      2024 guidance:

o  >2,400 tenancy additions (prior: 1,900 - 2,100)

o  Adjusted EBITDA of c.US$420m (prior: US$410m - US$420m)

o  Portfolio free cash flow of c.US$290m (prior: US$280m - US$290m)

o  Capital expenditure narrowed to US$170m - US$180m (prior: US$155m -
US$190m)

§ Of which, c.US$45m is anticipated to be non-discretionary capital
expenditure

o  Net leverage below 4.0x

o  Neutral free cash flow(2)

 

·      2025 targets:

o  Tenancy ratio >2.1x

o  Low double-digit Adjusted EBITDA growth

o  c.1ppt ROIC expansion

o  c.3.5x net leverage

 

1          Guidance assumes the Group continues to apply the same
accounting policies.

2          Excluding the closing of a potential second acquisition
(of 227 further sites) in Oman, as previously announced on 8 December 2022.

 

 

Helios Towers' management will host a conference call for analysts and
institutional investors at 09.30 GMT on Thursday, 7 November 2024. For the
best user experience, please access the conference via the webcast. You can
pre-register and access the event using the link below:

 

Registration Link - Helios Towers Q3 2024 Results Conference Call (https://www.investis-live.com/heliostowers/66fbd86e9bcff0000e4f7a22/hkrtt)

Event Name: Q32024

Password: HELIOS

 

If you are unable to use the webcast for the event, or if you intend to
participate in Q&A during the call, please dial in using the details
below:

 

 Europe & International      +44 203 936 2999
 South Africa (local)        +27 87 550 8441
 USA (local)                 +1 646 664 1960
 Passcode:                   577415

 

 

 

Upcoming Conferences and Events

 

·  New Street Research investor call (Virtual) - 13 November 2024

·  Morgan Stanley European Technology, Media & Telecom Conference
(Barcelona) - 20 to 21 November 2024

·  JP Morgan Telecoms Towers Call Series (Virtual) - 12 December 2024

 

 

For further information go to:

www.heliostowers.com (http://www.heliostowers.com)

 

Investor Relations

Chris Baker-Sams - Head of Strategic Finance and Investor Relations

+44 (0)782 511 2288

investorrelations@heliostowers.com (mailto:investorrelations@heliostowers.com)

 

Media relations

Edward Bridges / Rob Mindell

FTI Consulting LLP

+44 (0)203 727 1000

 

 

 

About Helios Towers

 

·      Helios Towers is a leading independent telecommunications
infrastructure company, having established one of the most extensive tower
portfolios across Africa. It builds, owns and operates telecom passive
infrastructure, providing services to mobile network operators.

 

·     Helios Towers owns and operates over 14,000 telecommunication tower
sites in nine countries across Africa and the Middle East.

 

·     Helios Towers pioneered the model in Africa of buying towers that
were held by single operators and providing services utilising the tower
infrastructure to the seller and other operators. This allows wireless
operators to outsource non-core tower-related activities, enabling them to
focus their capital and managerial resources on providing higher quality
services more cost-effectively.

 

 

Alternative Performance Measures

 

The Group has presented a number of Alternative Performance Measures ("APMs"),
which are used in addition to IFRS statutory performance measures. The Group
believes that these APMs, which are not considered to be a substitute for or
superior to IFRS measures, provide stakeholders with additional helpful
information on the performance of the business. These APMs are consistent with
how the business performance is planned and reported within the internal
management reporting to the Board. Loss before tax, gross profit, non-current
and current loans and long-term and short-term lease liabilities are the
equivalent statutory measures (see 'Certain defined terms and conventions').
For more information on the Group's Alternative Performance Measures, see the
Group's Annual report for the year ended 31 December 2023, publishedon the
Group's website. Reconciliations of APMs to the equivalent statutory measure
are included in the Group's Half-Year and Annual financial reports.

 

 

 

Financial and operating metrics

Key metrics

For the nine months ended 30 September:

 

                                           Group                Middle East & North Africa(3)               East & West Africa(4)               Central & Southern Africa(5)
                                           2024    2023         2024               2023                     2024           2023                 2024               2023
                                           US$m    US$m         US$m               US$m                     US$m           US$m                 US$m               US$m

 Sites at period end                       14,247  14,024  2,547                   2,528              6,484                6,411          5,216                    5,085
 Tenancies at period end                   29,021  26,624  4,132                   3,304              13,512               12,555         11,377                   10,765
 Tenancy ratio at period end               2.04x   1.90x   1.62x                   1.31x              2.08x                1.96x          2.18x                    2.12x
 Revenue for the period                    584.7   533.7   51.0                    41.4               238.4                234.0          295.3                    258.3
 Adjusted gross margin(1)                  65%     63%     81%                     76%                69%                  68%            59%                      55%
 Adjusted EBITDA for the period            311.9   269.2   36.8                    27.5               152.2                147.2          150.0                    120.7
 Adjusted EBITDA Margin(2) for the period  53%     50%     72%                     66%                64%                  63%            51%                      47%

1 Adjusted gross margin means gross profit, adding back site depreciation,
divided by revenue.

2 Group Adjusted EBITDA for the period includes corporate costs of US$27.1
million(2023:US$26.2 million).

3 Middle East & North Africa segment reflects the Company's operations in
Oman.

4 East & West Africa segment reflects the Company's operations in
Tanzania, Senegal and Malawi.

5 Central & Southern Africa segment reflects the Company's operations in
DRC, Congo Brazzaville, South Africa, Ghana and Madagascar.

 

 

Total tenancies as at 30 September

 

                                                        Middle East & North Africa                                        East & West Africa
                               Group                    Oman                                           Tanzania           Senegal                          Malawi
                               2024    2023             2024              2023                         2024   2023        2024          2023               2024  2023

 Standard colocation tenants   11,917  10,776  1,173                      701                    5,085        4,658  124                96            573        524
 Amendment colocation tenants  2,857   1,824   412                        75                     1,066        802    46                 30            134        34
 Total colocation tenants      14,774  12,600  1,585                      776                    6,151        5,460  170                126           707        558
 Total sites                   14,247  14,024  2,547                      2,528                  4,207        4,188  1,459              1,428         818        795
 Total tenancies               29,021  26,624  4,132                      3,304                  10,358       9,648  1,629              1,554         1,525      1,353
 Tenancy ratio                 2.04x   1.90x   1.62x                      1.31x                  2.46x        2.30x  1.12x              1.09x         1.86x      1.70x

 

 

                                                                             Central & Southern Africa
                               DRC                Congo Brazzaville          Ghana                                  South Africa           Madagascar
                               2024   2023        2024       2023            2024             2023                  2024     2023          2024    2023

 Standard colocation tenants   3,417  3,265  194             192        949                   980              249           252      153          108
 Amendment colocation tenants  554    378    67              33         441                   358              105           90       32           24
 Total colocation tenants      3,971  3,643  261             225        1,390                 1,338            354           342      185          132
 Total sites                   2,596  2,487  550             543        1,098                 1,095            383           377      589          583
 Total tenancies               6,567  6,130  811             768        2,488                 2,433            737           719      774          715
 Tenancy ratio                 2.53x  2.46x  1.47x           1.41x      2.27x                 2.22x            1.92x         1.91x    1.31x        1.23x

 

 

Revenue

Revenue increased by 10% to US$584.7m in the 9-month period ended 30 September
2024 (YTD 2023: US$533.7m). The increase was largely driven by the growth in
total tenancies from 26,624 as of 30 September 2023 to 29,021 as of 30
September 2024, particularly in Oman, Tanzania and DRC.

 

For the period ended 30 September 2024, 98% of revenues were from
multinational MNOs (YTD 2023: 98%) and 68% (YTD 2023: 64%) were denominated
hard currency, being either in USD, XAF/XOF (both of which are pegged to the
Euro) or OMR (which is pegged to the US Dollar).

 

Contracted revenue

The following table provides our total undiscounted contracted revenue by
region as of 30 September 2024 for each of the periods from 2024 to 2028, with
local currency amounts converted at the applicable average rate for US Dollars
for the period ended 30 September 2024 held constant. Our contracted revenue
calculation for each year presented assumes: (i) no escalation in fee rates,
(ii) no increases in sites or tenancies other than our committed tenancies,
(iii) our customers do not utilise any cancellation allowances set forth in
their MSAs, (iv) our customers do not terminate MSAs early for any reason and
(v) no automatic renewal.

 

 Year ended 31 December
                                 3 months to        2025   2026   2027   2028

                                 31 December 2024

                                 US$m               US$m   US$m   US$m   US$m
 Middle East & North Africa      18.0               55.1   55.0   55.0   55.0
 East & West Africa              74.5               298.7  270.1  257.1  250.8
 Central & Southern Africa       94.0               352.6  312.8  277.4  260.6
                                 186.5              706.4  637.9  589.5  566.4

 

The following table provides our total undiscounted contracted revenue by key
customer type as of 30 September 2024 over the life of the contracts with
local currency amounts converted at the applicable average rate for US Dollars
for the period ended 30 September 2024 held constant. Our calculation uses the
same assumptions as above. The average remaining life of customer contracts is
7.1 years (Q3 2023: 7.8 years).

 

 (US$m)              Total contracted  Percentage of total

                     revenues          contracted revenues
 Multinational MNOs  5,283.5           99.6%
 Others              22.6              0.4%
                     5,306.1           100.0%

 

Adjusted EBITDA

Adjusted EBITDA increased by 16% to US$311.9m in the nine-month period ended
30 September 2024 (YTD 2023: US$269.2m). The increase in

Adjusted EBITDA was driven by tenancy growth and margin accretive tenancy
ratio expansion of 0.14x year-on-year.

 

From a segment perspective, the year-on-year growth in the Group's Adjusted
EBITDA was driven by its Central & Southern Africa segment, growing by
US$29.3m year-on-year, in addition to the Middle East & North Africa and
East & West Africa segments expanding US$9.3m and US$5.0m, respectively.

 

Adjusted EBITDA margin was 53% in the 9-month period ended 30 September 2024
(YTD 2023: 50%).

 

Portfolio free cash flow

Portfolio free cash flow increased by 10% year-on-year to US$217.6m (YTD 2023:
US$197.1m), primarily driven by Adjusted EBITDA growth partially offset by
timing of tax paid.

 

 9 months ended 30 September
                                                    2024    2023

                                                    US$m    US$m
 Adjusted EBITDA                                    311.9   269.2
 Less: Maintenance and corporate capital additions  (31.1)  (27.6)
 Less: Payments of lease liabilities(1)             (36.3)  (35.3)
 Less: Tax paid                                     (26.9)  (9.2)
 Portfolio free cash flow                           217.6   197.1
 Cash conversion %(2)                               70%     73%

1 Includes interest and principal repayments of lease liabilities.

2 Cash conversion % is calculated as portfolio free cash flow divided by
Adjusted EBITDA.

 

 

Gross debt, net debt, net leverage and cash & cash equivalents

Net leverage decreased by 0.2x year-to-date to 4.2x (Q4 2023: 4.4x) and was
stable quarter-on-quarter (Q2 2024: 4.2x). The Group targets reducing net
leverage to below 4.0x in 2024.

 

                                30 September  31 December

                                2024          2023

                                US$m          US$m
 External debt(1)               1,683.6       1,650.3
 Lease liabilities              222.6         239.4
 Gross debt                     1,906.2       1,889.7
 Cash and cash equivalents      115.4         106.6
 Net debt                       1,790.8       1,783.1
 Annualised Adjusted EBITDA(2)  422.8         403.0
 Net leverage(3)                4.2x          4.4x

(1  )External debt is presented in line with the balance sheet amounts at
amortised cost. External debt is the total loans owed to commercial banks and
institutional investors, excluding loans due to minority interest holders from
June 2024.

(2  )Annualised Adjusted EBITDA calculated as per the Senior Notes definition
as the most recent fiscal quarter multiplied by 4. This is not a forecast of
future results.

(3  )Net leverage is calculated as net debt divided by annualised Adjusted
EBITDA.

 

 

Capital expenditure

The following table shows capital expenditure additions by category during the
nine months ended 30 September:

 

              2024                 2023
              US$m   % of          US$m   % of

                     Total capex          Total capex
 Acquisition  5.2    4.6%          12.4   8.3%
 Growth       58.9   52.0%         75.2   50.5%
 Upgrade      18.1   16.0%         33.7   22.7%
 Maintenance  26.4   23.3%         26.1   17.5%
 Corporate    4.7    4.1%          1.5    1.0%
              113.3  100.0%        148.9  100.0%

 

Growth capital expenditure, which includes new BTS, colocations and
operational efficiency investments, decreased by US$16.3m year-on-year, driven
by lower site additions of 150 in the nine-month period ended 30 September
2024 (YTD 2023: 471).

 

Upgrade capital expenditure, which reflects investments to improve the
structure and power systems on newly acquired sites, decreased by US$15.6m
year-on-year, reflecting progress on sites acquired in 2021 and 2022.

 

 

 

Certain defined terms and conventions

We have prepared the annual report using a number of conventions, which you
should consider when reading information contained herein as follows. All
references to 'we', 'us', 'our', 'HT Group', 'Helios Towers' our 'Group' and
the 'Group' are references to Helios Towers, plc and its subsidiaries, taken
as a whole.

 

'2G' means the second-generation cellular telecommunications network
commercially launched on the GSM and CDMA standards.

'3G' means the third-generation cellular telecommunications networks that
allow simultaneous use of voice and data services, and provide high-speed data
access using a range of technologies.

'4G' means the fourth-generation cellular telecommunications networks that
allow simultaneous use of voice and data services, and provide high-speed data
access using a range of technologies (these speeds exceed those available for
3G).

'5G' means the fifth generation cellular telecommunications networks. 5G does
not currently have a publicly agreed upon standard; however, it provides
high-speed data access using a range of technologies that exceed those
available for 4G.

'Adjusted EBITDA' is defined by management as profit/loss before tax for the
period, adjusted for finance costs, other gains and losses, interest
receivable, loss on disposal of property, plant and equipment, amortisation of
intangible assets, depreciation and impairments of property, plant and
equipment, depreciation of right-of-use assets, deal costs for aborted
acquisitions, deal costs not capitalised, share-based payments and long-term
incentive plan charges, and other adjusting items. Adjusting items are
material items that are considered one-off by management by virtue of their
size and/or incidence.

'Adjusted EBITDA margin' means Adjusted EBITDA divided by revenue.

'Adjusted gross margin' means Adjusted Gross Profit divided by revenue.

'Adjusted gross profit' means gross profit adding back site and warehouse
depreciation.

'Airtel' means Airtel Africa.

'amendment revenue' means revenue from amendments to existing site contracts
when tenants add or modify equipment, taking up additional vertical space,
wind load capacity and/or power consumption under an existing site contract.

'anchor tenant' means the primary customer occupying each site.

'Analysys Mason' means Analysys Mason Limited.

'annualised Adjusted EBITDA' means Adjusted EBITDA for the last three months
of the respective period, multiplied by four, adjusted to reflect the
annualised contribution from acquisitions that have closed in the last three
months of the respective period.

'Annualised portfolio free cash flow' means portfolio free cash flow in the
trailing twelve months, adjusted to annualise for the impact of acquisitions
closed during the period.

'average remaining initial life' means the average of the periods through the
expiration of the term under certain agreements, excluding future automatic
renewals.

'APMs' Alternative Performance Measures are measures of financial performance,
financial position or cash flows that are not defined or specified under IFRS
but used by the Directors internally to assess the performance of the Group.

'average grid hours' or 'average grid availability' reflects the estimated
site weighted average of grid availability per day across the Group portfolio
in the reporting year.

'Axian' means Axian Group.

'build-to-suit' (BTS) means sites constructed by our Group on order by a MNO.

'carbon emissions per tenant' is the metric used for our intensity target. The
carbon emissions include Scope 1 and 2 emissions for the markets included in
the target and the average number of tenants is calculated using monthly data.

'colocation' means the sharing of site space by multiple customers or
technologies on the same site, equal to the sum of standard colocation tenants
and amendment colocation tenants.

'colocation tenant' means each additional tenant on a site in addition to the
primary anchor tenant and is classified as either a standard or amendment
colocation tenant.

'committed colocation' means contractual commitments relating to prospective
colocation tenancies with customers.

'Company' means Helios Towers plc.

'Congo Brazzaville' otherwise also known as the Republic of Congo.

'contracted revenue' means total undiscounted revenue as at that date with
local currency amounts converted at the applicable average rate for US Dollars
held constant. Our contracted revenue calculation for each year presented
assumes: (i) no escalation in fee rates, (ii) no increases in sites or
tenancies other than our committed tenancies (which include committed
colocations and/or committed anchor tenancies), (iii) our customers do not
utilise any cancellation allowances set forth in their MLAs (iv) our customers
do not terminate MLAs early for any reason and (v) no automatic renewal.

'corporate capital expenditure' primarily relates to furniture, fixtures and
equipment.

'downtime per tower per week' refers to the average amount of time our sites
are not powered across each week within our seven markets that Helios Towers
was operating in across 2022 and 2023.

'Deloitte' means Deloitte LLP.

'DRC' means Democratic Republic of Congo.

'FRS 102' means the Financial Reporting Standard Applicable in the UK and
Republic of Ireland.

'free cash flow' means levered portfolio free cash flow less discretionary
capital additions and cash paid for exceptional and one-off items, and
proceeds on disposal assets.

'Ghana' means the Republic of Ghana.

'GHG' means greenhouse gases.

'gross debt' means non-current loans and current loans and long-term and
short-term lease liabilities.

'gross leverage' means gross debt divided by annualised Adjusted EBITDA.

'gross profit' means revenue after deducting cost of sales.

'growth capex' or 'growth capital expenditure' relates to (i) construction of
build-to-suit sites (ii) installation of colocation tenants and (ii) and
investments in power management solutions.

'Group' means Helios Towers plc and its subsidiaries.

'GSMA' is the industry organisation that represents the interests of mobile
network operators worldwide.

'hard currency Adjusted EBITDA' refers to Adjusted EBITDA that is denominated
in US Dollars, US Dollar pegged, US Dollar linked or Euro pegged.

'hard currency Adjusted EBITDA %' refers to Hard currency Adjusted EBITDA as a
% of Adjusted EBITDA

'Helios Towers Congo Brazzaville' or 'HT Congo Brazzaville' means Helios
Towers Congo Brazzaville SASU.

'Helios Towers DRC' or 'HT DRC' means HT DRC Infraco SARL.

'Helios Towers Ghana' or 'HT Ghana' means HTG Managed Services Limited.

'Helios Towers Oman' or 'HT Oman' means Oman Tech Infrastructure SAOC.

'Helios Towers plc' means the ultimate Company of the Group.

'Helios Towers South Africa' or 'HTSA' means Helios Towers South Africa
Holdings (Pty) Ltd and its subsidiaries.

'Helios Towers Tanzania' or 'HT Tanzania' means HTT Infraco Limited.

'IFRS' means International Financial Reporting Standards as adopted by the
European Union.

'independent tower company' means a tower company that is not affiliated with
or majority owned by a telecommunications operator.

'ISO accreditations' refers to the International Organisation for
Standardisation and its published standards: ISO 9001 (Quality Management),
ISO 14001 (Environmental Management), ISO 45001 (Occupational Health and
Safety), ISO 37001 (Anti-Bribery Management) and ISO 27001 (Information
Security Management).

'IVMS' means in-vehicle monitoring system.

'Lean Six Sigma' is a renowned approach that helps businesses increase
productivity, reduce inefficiencies and improve the quality of output.

'lease-up' means the addition of colocation tenancies to our sites.

'Levered portfolio free cash flow' means portfolio free cash flow less net
payment of interest and net change in working capital.

'Lost Time Injury Frequency Rate' means the number of lost time injuries per
one million person-hours worked (12-month roll)

'LTIP' means Long-Term Incentive Plan.

'Madagascar' means Republic of Madagascar.

'Malawi' means Republic of Malawi.

'maintenance capital expenditure' means capital expenditures for periodic
refurbishments and replacement of parts and equipment to keep existing sites
in service.

'Mauritius' means the Republic of Mauritius.

'MENA' means Middle East and North Africa.

'Middle East' region includes thirteen countries namely Hashemite Kingdom of
Jordan, Kingdom of Bahrain, Kingdom of Saudi Arabia, Republic of Iraq,
Republic of Lebanon, State of Kuwait, Sultanate of Oman, State of Palestine,
State of Qatar, Syrian Arab Republic, The Republic of Yemen, The Islamic
Republic of Iran and The United Arab Emirates.

'MLA' means master lease agreement.

'MNO' means mobile network operator.

'mobile penetration' means the amount of unique mobile phone subscriptions as
a percentage of the total market for active mobile phones.

'MTN' means MTN Group Ltd.

'MTSA' means master tower services agreement.

'near miss' is an event not causing harm but with the potential to cause
injury or ill health.

'NED' means Non-Executive Director.

'net debt' means gross debt less cash and cash equivalents.

'net leverage' means net debt divided by annualised Adjusted EBITDA.

'net receivables' means total trade receivables (including related parties)
and accrued revenue, less deferred income.

'Oman' means Sultanate of Oman.

'Omantel' means Oman Telecommunications Company SAOG.

'Orange' means Orange S.A.

'organic tenancy growth' means the addition of BTS or colocations not as a
result of M&A activities.

'our established markets' refers to Tanzania, DRC, Congo Brazzaville, Ghana
and South Africa.

'our markets' or 'markets in which we operate' refers to Tanzania, DRC, Congo
Brazzaville, Ghana, South Africa, Senegal, Madagascar, Malawi and Oman.

'population coverage' refers to the Company estimated potential population
that falls within the network coverage footprint of our towers, calculated
using WorldPop source data.

'Portfolio free cash flow' defined as Adjusted EBITDA less maintenance and
corporate capital additions, payments of lease liabilities (including interest
and principal repayments of lease liabilities) and tax paid.

'PoS' means points of service, which is an MNO's antennae equipment
configuration located on a site to provide signal coverage to subscribers. At
Helios Towers, a standard PoS is equivalent to one tenant on a tower.

'power uptime' reflects the average percentage our sites are powered across
each month, and is a key component of our service offering to customers. For
comparability, figures presented only reflect portfolios that are subject to
power SLAs for both the current and prior reporting period. This includes
Tanzania, DRC, Senegal, Congo Brazzaville, South Africa, Ghana and Madagascar.

'Project 100' refers to our commitment to invest US$100 million between 2022
and 2030 on carbon reduction and carbon innovation.

'road traffic accident frequency rate' means the number of work-related road
traffic accidents per 1 million kilometres driven (12-month roll).

'ROIC' means return on invested capital and is defined as annualised portfolio
free cash flow divided by invested capital.

'rural area' while there is no global standardised definition of rural, we
have defined rural as milieu with population density per square kilometre of
up to 1,000 inhabitants. These include greenfield sites, small villages and
towns with a series of small settlement structures.

'rural coverage' is the population living within the footprint of a site
located in a rural area.

'rural sites' means sites which align to the above definition of 'rural area'.

'Senegal' means the Republic of Senegal.

'SHEQ' means safety, health, environment and quality.

'site acquisition' means a combination of MLAs or MTSAs, which provide the
commercial terms governing the provision of site space, and individual ISA,
which act as an appendix to the relevant MLA or MTSA, and include
site-specific terms for each site.

'site agreement' means the MLA and ISA executed by us with our customers,
which act as an appendix to the relevant MLA and includes certain
site-specific information (for example, location and any grandfathered
equipment).

'SLA' means service-level agreement.

'South Africa' means the Republic of South Africa.

'standard colocation' means tower space under a standard tenancy site contract
rate and configuration with defined limits in terms of the vertical space
occupied, the wind load and power consumption.

'Tanzania' means the United Republic of Tanzania.

'TCFD' means Task Force on Climate-Related Financial Disclosures.

'telecommunications operator' means a company licensed by the government to
provide voice and data communications services.

'tenancy' means a space leased for installation of a base transmission site
and associated antennae.

'tenancy ratio' means the total number of tenancies divided by the total
number of our sites as of a given date and represents the average number of
tenants per site within a portfolio.

'tenant' means an MNO that leases vertical space on the tower and portions of
the land underneath on which it installs its equipment.

'the Trustee' means the trustee(s) of the EBT.

'total colocations' means standard colocations plus amendment colocations as
of a given date.

'total recordable case frequency rate' means the total recordable injuries
that occur per one million hours worked (12-month roll).

'total tenancies' means total anchor, standard and amendment colocation
tenants as of a given date.

'tower contract' means the MLA and individual site agreements executed by us
with our customers, which act as a schedule to the relevant MLA and includes
certain site-specific information (for example, location and equipment).

'towerco' means tower company, a corporation involved primarily in the
business of building, acquiring and operating telecommunications towers that
can accommodate and power the needs of multiple tenants.

'tower sites' means ground-based towers and rooftop towers and installations
constructed and owned by us on property (including a rooftop) that is
generally owned or leased by us.

'UK Corporate Governance Code' or 'the Code' means the UK Corporate Governance
Code published by the Financial Reporting Council and dated July 2018, as
amended from time to time.

'UK GAAP' means the United Kingdom Generally Accepted Accounting Practice.

'upgrade capex' or 'upgrade capital expenditure' comprises structural,
refurbishment and consolidation activities carried out on selected acquired
sites.

'Viettel' means Viettel Tanzania Limited.

'Vodacom' means Vodacom Group Limited.

 

 

Disclaimer:

This release does not constitute an offering of securities or otherwise 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 (the 'Group'), nor
should it be construed as legal, tax, financial, investment or accounting
advice. This release contains forward-looking statements which are subject to
known and unknown risks and uncertainties because they relate to future
events, many of which are beyond the Group's control. These forward-looking
statements include, without limitation, statements in relation to the
Company's financial outlook and future performance. No assurance can be given
that future results will be achieved; actual events or results may differ
materially as a result of risks and uncertainties facing the Group.

 

You are cautioned not to rely on the forward-looking statements made in this
release, which speak only as of the date of this announcement. The Company
undertakes no obligation to update or revise any forward-looking statement to
reflect any change in its expectations or any change in events, conditions or
circumstances. Nothing in this release is or should be relied upon as a
warranty, promise or representation, express or implied, as to the future
performance of the Company or the Group or their businesses.

 

This release also contains non-GAAP financial information which the Directors
believe is valuable in understanding the performance of the Group. However,
non-GAAP information is not uniformly defined by all companies and therefore
it may not be comparable with similarly titled measures disclosed by other
companies, including those in the Group's industry. Although these measures
are important in the assessment and management of the Group's business, they
should not be viewed in isolation or as replacements for, but rather as
complementary to, the comparable GAAP measures.

 

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