Helios Towers, a telecom infrastructure business, has announced that it expects to reach the tipping point for free cash flow in the financial year (FY) 2024.
Tom Greenwood, CEO of Helios Towers, announced the company results for the year ending 31 December 2023. He said the company believes expanding the tenancy ratio will accelerate beyond its previous medium-term estimate.
“As such, we have adjusted our strategic target of ‘22,000 towers by 2026’, which included meaningful inorganic site growth, to ‘2.2x tenancy ratio by 2026’, prioritising organic growth and returns expansion,” said Greenwood.
He added, “Consequently, we expect FY 2024 to be our inflexion year for free cash flow and to continue to grow after that.
“We have built a compelling and unique platform in some of the world’s fastest-growing mobile markets. Our focus on customer service excellence allows us to capture structural growth and deliver sustainable value for our stakeholders.”
The independent tower company owns and manages 13,300 telecom tower sites in eight African markets – Tanzania, the Democratic Republic of the Congo, Congo Brazzaville, Ghana, South Africa, Senegal, Madagascar, Malawi – and Oman in the Middle East.
Turning to financial metrics, FY 2023 revenue increased by 29% year-on-year to US$721.0 million (FY 2022: US$560.7 million), driven by organic tenancy growth, complemented by acquisitions in Malawi and Oman.
He added, “Higher finance costs reflect the non-cash impact of foreign exchange movements on the group’s intercompany borrowings and the full-year impact of increased debt, largely related to the Oman acquisition, which closed in December 2022.”
During the year, Helios’ portfolio free cash flow increased by 33% year-on-year to US$268.2 million (FY 2022: US$201.4 million). Greenwood said this was driven by adjusted EBITDA growth and proportionately lower increases in payments of lease liabilities and taxes paid.
Looking ahead to the company strategy, Greenwood said: “The Group’s capital allocation policy is focused on growing portfolio free cash flow while consistently delivering a return on invested capital above its cost.
