Helios Towers plc (“Helios Towers”,“the Group” or “the Company”), the independent telecommunications infrastructure company, has announced results for the 6 months to 30 June 2022.
We have delivered strong organic tenancy growth in the first half of the year, which combined with the successful integration of acquired assets in Senegal, Madagascar and Malawi has resulted in impressive year-on-year financial performance. Despite broader global macroeconomic uncertainty, our uniquely positioned platform, highly visible base of quality earnings and unparalleled structural growth continues to drive sustainable value creation for all of our stakeholders.
Tom Greenwood, Chief Executive Officer, Helios Towers
Following are the financial highlights of the same:
- H1 2022 revenue increased by 25% year-on-year to US$265.4m (H1 2021: US$212.4m) driven by acquisitions in Senegal, Madagascar and Malawi and strong organic tenancy growth across the Group, in addition to CPI and power price escalations. Excluding acquisitions, revenue increased 12% year-on-year.
- Q2 2022 revenue increased by 8% quarter-on-quarter to US$137.9m (Q1 2022: US$127.5m).
- H1 2022 Adjusted EBITDA increased by 19% year-on-year to US$136.1m (H1 2021: US$114.2m), driven by revenue growth, with H1 2022 Adjusted EBITDA margin decreasing 3ppt year-on-year to 51% (H1 2021: 54%), reflecting the previously communicated SG&A investment to support the Group’s ongoing expansion into ten markets and higher fuel costs in DRC in Q2 2022.
- Q2 2022 Adjusted EBITDA increased by 4% quarter-on-quarter to US$69.4m (Q1 2022: US$66.7m), with Q2 2022 Adjusted EBITDA margin at 50% (Q1 2022: 52%).
- Operating profit increased 48% year-on-year to US$39.8m (H1 2021: US$26.9m) driven by strong revenue growth, partially offset by a modest increase in administrative expenses as part of the Group’s ongoing expansion.
- Loss before tax increased to US$122.2m (H1 2021 US$43.6m), driven by a US$83.8m year-on-year increase in non-cash expenses related to both the fair value movements of the embedded derivatives in the Group’s bond and foreign exchange movements on Euro and US dollar denominated intercompany borrowings.
- Portfolio free cash flow increased by 36% year-on-year to US$100.4m (H1 2021: US$73.8m), driven by Adjusted EBITDA growth and timing of non-discretionary capital expenditure.
- Cash generated from operations increased 99% to US$91.0m driven by higher Adjusted EBITDA and movements in working capital.
- Net leverage increased by +0.7x year-on-year to 3.9x (H1 2021: 3.2x), primarily due to acquisitions in Madagascar and Malawi, and quarter-on-quarter by 0.2x (Q1 2022: 3.7x), remaining comfortably within the Group’s medium-term target range of 3.5x – 4.5x.
- Strong balance sheet with 96% of drawn debt at a fixed rate, no near-term maturities and fully-funded for announced transactions.
- Business underpinned by long-term contracted revenues of US$4.2bn (H1 2021: US$3.5bn), of which 99% is from large multinational MNOs, with an average remaining life of 7.2 years (H1 2021: 7.4 years).
- Pro forma for announced transactions in Oman and Gabon, the Group has contracted revenues of US$5.3 billion.
- CPI and power price escalators embedded into customer contracts provides an effective hedge against inflation and fuel price movements over a full-year cycle.
Following are the operational highlights of the same:
- Sites increased by 2,091 year-on-year to 10,694 sites (H1 2021: 8,603 sites), reflecting 1,213 acquired sites in Malawi and Madagascar and 878 organic site additions.
- Sites increased organically by 183 quarter-on-quarter (Q1 2022: 10,511).
- Tenancies increased by 3,459 year-on-year to 20,549 tenants (H1 2021: 17,090 tenants), reflecting 1,692 acquired tenancies in Malawi and Madagascar and 1,767 organic tenancy additions.
- Tenancies increased organically by 316 quarter-on-quarter (Q1 2022: 20,233).
- Tenancy ratio decreased 0.07x year-on-year to 1.92x (H1 2021: 1.99x), reflecting the dilutive impact of acquired assets in Madagascar (1.20x) and Malawi (1.58x).
