Telecomunicazioni
Millicom Q4 & FY 2016 Results, 8 February 2017
"In 2016 we made substantial progress towards our strategic goal of a two-fold reconfiguration of our business, rapidly growing our mobile data and cable revenue in Latin America , and pushing ahead with major initiatives to enhance our operational efficiency.
Looking ahead to 2017, we aim to accelerate further the implementation of our strategy in Latin America , targeting to roll out state-of-the-art fibre to more than 1 million additional homes in the year, and to add more than 3 million new 4G mobile data customers."
"In the final quarter of the year mobile data and cable in Latin America together contributed 50% of total group service revenue, compared to 45% in the same period the year before, as we reach a pivotal point in our revenue mix. Cable revenue growth was driven by the addition in the year of 777,000 new fibre homes passed, taking our total cable footprint to over 8.1 million homes, ahead of the target of 8 million we had set at the start of the year.
Growth of mobile data revenue in Latam was driven by the increase in the number of smartphone data users, and in particular by the rapid growth of our 4G customer base. We have now launched 4G in all of our Latam markets and our high-ARPU 4G customer base grew four-fold during the year, to more than 3.4 million.
As expected we saw continuing erosion of our voice and SMS revenues in Latam during the year, reflecting the changing patterns of customer usage seen in mobile markets globally, and this constrained our total service revenue growth in Latam in the year. The effect of declining voice and SMS was exacerbated in Colombia , our largest market, which saw competitive pressures throughout 2016, although easing somewhat at the end of the year. We also experienced very difficult operating conditions in El Salvador.
Service revenue in Latam was therefore down 0.2% in the year, and while EBITDA declined by 2.2% our margin improved slightly to 38.5%, and we generated Operating Cash Flow of $1.2 billion .
Operational efficiencies achieved during the first year of our Project Heat initiatives underpinned our EBITDA margin and higher cash-flow in Latam, delivering a lower operating cost run rate as well as capex and working capital savings during 2016.
Our African business performed well in 2016, exceeding our targets. Service revenue grew by 10.5% and the EBITDA margin improved to 29%, from 22% in 2015. Most importantly, we achieved our target for Africa of positive operating cash flow in 2016, delivering Operating Cash Flow of $97 million .
We have agreed to sell our business in Senegal to Wari Group for $129 million , subject to regulatory approvals. We have also initiated a process to sell our 22% stake in Helios Towers Africa. Both transactions are in line with our aim of focusing our business where we can develop advanced fixed and mobile data services and add material long-term value, while monetising the significant value we have created in other areas.
Overall in 2016 we made substantial strategic progress and delivered service revenue growth, a higher EBITDA margin, and strong cash flow with our OCF margin of 18.3% now close to our 20% medium-term target. This performance gives us a solid base on which to accelerate our strategic execution in 2017 and deliver further revenue, EBITDA and cash flow growth."
"For 2017 we expect organic service revenue growth to be in the low single-digit range, and ahead of the growth we achieved in 2016. Whilst we expect robust competition in Colombia to continue, and voice and SMS revenues across Latam to decline further through 2017, the lower weighting of these within our overall mix, combined with further strong growth in our mobile data, home and B2B revenues, allows us to be more confident about our revenue growth outlook in 2017.
We expect to make further progress in configuring our cost base in 2017, driven by both operational leverage and Project Heat initiatives. We therefore expect to deliver organic growth in EBITDA in the mid-to-high single-digit range, and again higher than the growth seen in 2016.
Capex in 2017 is expected to be broadly in line with 2016, and focused on our core growth areas of fibre and 4G network roll-out, with converged IT infrastructure
By growing EBITDA, and targeting our investment programme, we expect to deliver Operating Cash Flow growth in 2017 of around 10%".
Based on constant currency, at a constant perimeter with Guatemala and Honduras fully consolidated, and on our current assessment of the macroeconomic outlook, we currently expect for 2017:
Against our 2015 currency adjusted service revenue of $5.73 billion , full-year service revenue growth in 2016 was 1.4%, and against our 2015 currency adjusted EBITDA of $2.09 billion , full-year adjusted EBITDA growth in 2016 was 4.8%.
At the Annual General Meeting on 4 May 2017 the Board will propose payment of an unchanged ordinary dividend of $2.64 per share.
On 7 February we announced the sale of our business in Senegal for $129 million . The transaction is subject to regulatory approval. We have also announced our intention to sell a 22% stake in Helios Towers Africa, one of the leading tower companies in Africa
A presentation and conference call to discuss these results will take place at 14.00 Stockholm / 14.00 Luxembourg / 13.00 London / 08.00 New York , on Wednesday 8 February. Dial-in numbers:
Sweden : + 46 (0) 8-5033-6574
UK : + 44 (0) 330-336-9411
US : + 1-719-325-2213
Luxembourg : + 352-2786-1395
Access code: 2979432
A live audio stream of the analyst presentation can also be accessed at www.millicom.com. Please dial in / log on 10 minutes prior to the start of the conference call to allow time for registration. Slides to accompany the conference call will be available at www.millicom.com
Millicom will publish Results for 2017 First Quarter on Wednesday 26 April 2017 .
David Boyd ,
Interim Head of Investor Relations
Tel: +352-277-59084 ( Luxembourg ) / +44 (0) 20-3249-2413 / +44-7584-889531
Mauricio Pinzon , Investor Relations Manager
Tel: +44 (0) 20-3249-2460
investors@millicom.com
Vivian Kobeh, Corporate Communications Director
Tel: +352-277-59084 / Mobile +1-305-3022858
press@millicom.com
This information was brought to you by Cision http://news.cision.com
http://news.cision.com/millicom-international-cellular/r/millicom-q4---fy-2016-results--8-february-2017,c2182725
The following files are available for download: