In This Article:
-
Tenancy Additions: Over 2,000 year-to-date, with a target of 2,400 by year-end.
-
Tenancy Ratio: Current ratio of 2.04, aiming for 2.2 by 2026.
-
EBITDA: Year-to-date increase of 16% year-on-year; full-year guidance at $420 million, a 14% increase.
-
Revenue Growth: 6% year-on-year, driven by tenancy additions.
-
EBITDA Margin: Increased by 2 percentage points to 54%.
-
Leverage: Reduced by 0.3x year-on-year to 4.2x, with a target below 4x by year-end.
-
CapEx: Total of $113 million in the first nine months; full-year guidance adjusted to $170-$180 million.
-
Free Cash Flow: Expected to be neutral by year-end, marking an inflection point.
-
Future Committed Revenue: $5.3 billion, equating to over seven years of remaining leases.
Release Date: November 07, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Helios Towers PLC (HTWSF) reported over 2000 tenancy additions year-to-date, showing strong progress towards their 2026 target of a 2.2 tenancy ratio.
-
The company achieved a year-to-date EBITDA increase of 16% year-on-year, with expectations to end the year at the top of the range with around $420 million, representing a 14% year-over-year increase.
-
Helios Towers PLC (HTWSF) has a strong base of $5.3 billion in future committed revenue, equating to over seven years of remaining leases before renewals.
-
The company is on track to become free cash flow generative from next year, marking a significant shift from historically high investment and negative free cash flow.
-
The company has successfully reduced leverage by 0.3x year-on-year and expects to continue reducing leverage to around 3x by the end of 2025, opening the door for potential investor distributions.
Negative Points
-
The company experienced a free cash flow outflow of about $20 million year-to-date up to Q3, primarily driven by working capital timing issues.
-
There are concerns about potential currency risks in markets like the DRC and Tanzania, although the company reports no significant changes in currency availability.
-
Despite strong tenancy growth, the company faces challenges in maintaining a balance between site builds and co-locations, which could impact future revenue streams.
-
The company remains cautious about M&A activities, indicating that it is not a priority within the current capital allocation framework, potentially limiting growth opportunities.
-
Helios Towers PLC (HTWSF) has a high leverage ratio of 4.2x, which, although decreasing, still poses a risk until it reaches the target of 3x.