Ihs Holding Ltd. ((IHS)) has held its Q2 earnings call. Read on for the main highlights of the call.
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IHS Holding Ltd. recently held its earnings call, revealing a generally positive sentiment with several highlights, including strong revenue growth and improved debt management. The company expressed optimism for the remainder of 2025, despite challenges such as foreign exchange impacts and decreased Adjusted Levered Free Cash Flow (ALFCF).
Strong Revenue Growth
The company reported revenue of $433 million, marking an impressive 11% organic growth. This growth was primarily driven by colocation, lease amendments, new sites, and Consumer Price Index (CPI) escalators, showcasing the company’s robust market positioning.
Improved Debt Management
IHS Holding Ltd. successfully repaid $154 million of high-interest debt, which resulted in a reduction of the weighted average cost of debt by 100 basis points to 8.3%. This strategic move highlights the company’s focus on strengthening its financial health.
Increased EBITDA Margin
The company reported an adjusted EBITDA of $248.5 million, maintaining a stable margin of over 57% year-on-year. This stability reflects the company’s efficient operational management and cost control measures.
Positive Outlook and Guidance Revision
IHS Holding Ltd. raised its full-year 2025 outlook across all key metrics, including a $25 million uplift in adjusted EBITDA guidance. This revision underscores the company’s confidence in its growth trajectory and strategic initiatives.
Nigeria Market Performance
Despite the depreciation of the Naira, the Nigeria segment reported revenue of $260 million with over 10% organic growth. This performance highlights the company’s resilience and ability to navigate currency challenges in key markets.
Impact of Foreign Exchange Rates
The company’s organic growth was partially offset by a 9% impact from foreign exchange rate movements, including the Nigerian Naira versus the U.S. dollar. This challenge underscores the volatility faced by companies operating in multiple currencies.
Decreased ALFCF
Adjusted Levered Free Cash Flow decreased by approximately 19% year-over-year, attributed to higher interest payments following bond refinancing. This decrease highlights the financial pressures from recent refinancing activities.
Challenges in Sub-Saharan Africa
While revenue in the Sub-Saharan African segment increased by 18%, the segment’s adjusted EBITDA decreased by 4% year-on-year due to higher power generation and tower maintenance costs. These challenges reflect the operational complexities in the region.
Forward-Looking Guidance
Looking ahead, IHS Holding Ltd. has set an optimistic outlook for 2025, with expected revenue between $1.7 billion and $1.73 billion, adjusted EBITDA between $985 million and $1.005 billion, and ALFCF between $390 million and $410 million. The company aims to continue reducing leverage, potentially introducing dividends or share buybacks, and exploring further value-creative disposal opportunities.
In summary, IHS Holding Ltd.’s earnings call painted a positive picture with strong revenue growth and improved debt management. Despite facing challenges such as foreign exchange impacts and decreased ALFCF, the company remains optimistic about its future prospects, as reflected in its revised guidance for 2025.