The independent tower company owns and manages 13,300 telecom tower sites in eight African markets.

Helios Towers, which is listed on the London Stock Exchange, anticipates the financial year (FY) 2024 to be the tipping point for free cash flow, and to continue growing beyond that.

Tom Greenwood, CEO, Helios Towers, today announced company results for the year to 31 December 2023. He said that the company believes that tenancy ratio expansion 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 inflection year for free cash flow, and continue to grow thereafter.

“We have built a compelling and unique platform in some of the world's fastest growing mobile markets and through our focus on customer service excellence, are well placed to capture the 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 $721.0 million (FY 2022: $560.7 million), driven by organic tenancy growth, complemented by acquisitions in Malawi and Oman.

Further, Greenwood said FY 2023 operating profit increased by 82% year-on-year to $146.1 million (FY 2022: $80.3 million), driven by adjusted EBITDA growth, while loss before tax improved to $112.2 million (FY 2022: $162.5 million), primarily driven by a $65.8 million year-on-year increase in operating profit.

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 $268.2 million (FY 2022: $201.4 million). Greenwood said this was driven by adjusted EBITDA growth and proportionately lower increases in payments of lease liabilities and taxes paid.

“FY 2023 portfolio free cash flow exceeded updated guidance of $260m – $265m, due to the timing of non-discretionary capex.”

Looking ahead on the company strategy, Greenwood said: “The Group’s capital allocation policy is focused on growing portfolio free cash flow while consistently delivering return on invested capital above its cost of capital.