Q1 2023 IHS Holding Limited Earnings Call

And.

Good day and welcome to the IHS Holdings Limited Earnings results call for the three-month loop forequest survey results.

Please note that today's conference is being webcast and recorded. If you would like to ask a question, please press star and then one on your telephone keypad at any time. At this time, I'd like to turn the conference over to Colby, Sinosale. Please go ahead, sir.

Thank you operator. Thanks also to everyone for joining the call today. I'm Colby Sinacell, the EVP of Communications here at IHS. With me today are Sam Dyerwish, our chairman and CEO and Steve Houdent, our CFO . This morning we published our unaudited financial statements for the three month period and in March 31st, 2023.

on the Investor Relations section of our website and issue related earnings release in presentation.

These are the consolidated results of IHS holding limited, which is listed on the New York Stock Exchange on the sticker symbol IHS, which comprises the entirety of the group's operations.

Before we discuss the results, I would like to draw your attention to the disclaimer that at the beginning of the presentation on slide two, we should be read and full along with the cautionary statement regarding forward-looking statements that happened our earnings release in 6K file as well today.

In particular, the information to be discussed may contain four looking statements which, by their nature, involve known and unknown risks, uncertainties, and other important factors, some of which are beyond our control that are difficult to predict, and other factors which may cause actual results, performance, or achievements, or industry results to be materially different from any future results.

performance or achievements or industry results expressed or implied by such forward-looking statements, including those discussed in the risk factor section of our Form 20F, followed with the Securities and Exchange Commission and other filings with the SEC. We'll also refer to non-IFRS measures that we view as important in assessing the performance of our business.

Reconciliation of non-IFRS metrics to the nearest IFRS metrics can be found in our earnings presentation, which is available on the Investor Relations section of our website.

With that, I'd like to turn the call over to Sam D'Arwich, our chairman and CEO .

Thanks, Colby, and welcome everyone to our first quarter, 2023 earnings results score. We had another strong quarter with growth primarily driven by sequential step-up from new lease amendments, escalators, and 4x3 sets, while growth from power moderated, all as expected.

Results also included a $48 million one-time benefit to revenue and adjusted EBITDA from our smallest key customer in Nigeria. Inclusive of $5 million additional withholding tax gross up and a $43 million one-time benefit to RLSCF. Lastly, Q1 results included a $9 million for its tailwind versus race

rates now assumed in guidance imply $14 million upside versus rates previously assumed in guidance.

Overall, we remain on track to achieve our goals for 2023. Skipping to slide 7, I want to discuss some of our key highlights for the quarter. Starting with Nigeria, President-elect Bola Ahmed Tenobo is expected to be sworn in as Nigeria's next president on May 29. We wish Mr. Tenobo much success and continue to be cautiously optimistic about the economic issues he has said he intends to address. More specific to IHS, we completed the upstreaming that began last quarter and resulted in an incremental $15 million upstream in Q1. We're also pleased to announce today that subsequent to quarter end, we will be starting

We have uptrend and additional 50 million dollars.

Lastly, on Nigeria, during Q1, we elected to rationalize 727 towers occupied by our smallest key customer, where we were not recognizing revenue, but were incurring costs. This was unexpected and will help drive cost savings, a positive development.

In South Africa, our acquisition of nearly 6,000 towers from MTAN a year ago immediately made us the largest independent tower operator in the country.

Moving on, the Block B shares, which equate to just over 60 million shares, became available to trade without the registered offering requirement on April 14th, and another 120 million plus shares will become available in October 2023, including Block C&D. After taking initial steps in 2022 to help improve stock liquidity, including waving the registered offering requirement last May, we believe that releases of Block B, C, and D this year may further help our trading volumes, and we continue to evaluate options that we believe would enhance the value of the company.

Lastly, as previously disclosed, during Q1, we entered into a NIRA-denominated term loan, an RFCF, as we look to increase the percent of our debt held in local currency, or more specifically, the NIRA, in anticipation of a potential NIRA devaluation.

Overall, we continue to take a disciplined approach to capital deployment recognizing the importance of maintaining a strong balance sheet. This includes net leverage of 3.1 at the low end of our three to four target, and no meaningful maturities due until Q425.

while we continue to optimize our balance sheet, we are generally happy with where we are.

Quickly, you see on slide 8 that we expect to publish our 2022 Sustainability Report later this quarter, which will be our fifth year of doing so. The 2022 Sustainability Report will be our first year reporting under the GRI framework, indicating our continued evolution in sustainability reporting at IHS.

And with that, I will turn the call over to Steve. Thanks Sam and hello everyone. Having reported our Q4 and full year 2022 results less than two months ago, and discussed the relevance of Q1 then, I'll be particularly concise today.

Turning to slide nine, as Sam mentioned, we're pleased with our Q1 performance. You will see that our main KPIs have all increased by double-digit percentages in Q1 2023 versus Q1 2022. And we once again delivered double-digit growth in revenue, adjusted EBITDA, and RLFCF for the quarter, even after excluding the one-time cash payment received in Q1 2023 versus Q1 2022.

35% growth in revenue, 37% growth in adjusted EBITDA, and 72% growth in ROFCF, in each case on a reported basis, driven by both organic and inorganic activity across our markets.

Our adjusted EBITDA margin improved to 55.7% and 80 basis points gain on Q1 2022. I'll talk about these rates as adjusted for the one-time revenue on later slides to give a true performance comparison.

As you also see, CAPEX grew by 30% in the quarter, largely due to investment in network refurbishment in South Africa, increased CAPEX relating to high systems, fiber deployment in Latin, and it Nigeria, ongoing investment in project green, offset in part by decreases in other and fiber CAPEX there. Finally, our consolidated net leverage ratio was 3.1 times at the end of Q1.

An increased versus last year following two acquisitions but a slight decrease from Q422. Turning to our revenue on a consolidated basis, slide 10 shows the components of our 35.1% reported consolidated revenue growth for the first quarter. Organic revenue growth of 38% with driven primarily by the 48%

flexor contract protections while the level of power related revenue continues to reflect the high energy price environment will be it was down from last quarter.

I would also again note that we now include the power pass-through revenue we received in South Africa within the power segment and in Q1 accounted for $1.4 million.

On the right, you can see the organic growth rates of each of our segments for the quarter, with Nigeria delivering 47% organic growth, including that one-time payment.

Inorganic growth for Q1 was 8.3% reflecting the South African acquisition, the SP5 acquisition in Brazil and the fifth stage of the Kuwait acquisition.

It'll get the rate will continue to drop in Q2 as we are passing the anniversaries of the SP5 and South African transactions.

We did a strong growth of 24% on a reported basis and 27% on an organic basis.

On slide 11, you can see our consolidated revenue adjusted EBITDA and adjusted EBITDA margins for Q123. And I discussed on the prior slide in the first quarter, IHS generated a 35% increase in reported revenue.

Organic revenue growth was even higher of 38% again, demonstrating it continued strong, top-line growth trends of the businesses led by Nigerian last time in particular.

In Q123, adjusted EBITDA of $335 million, increased 37% versus Q122. An adjusted EBITDA margin was 55.7% up 80-based points from the prior year. The year-of-year changes in adjusted EBITDA and margin for the first quarter primarily reflect the increase in revenue we've already discussed, including that one-time revenue. Partially upset with the year-on-year cost increases in cost of sale of many due to higher diesel costs, increased maintenance to repair costs on a larger business.

as well as increased the administrative expenses resulting from employee costs related to the acquisitions. Without the $48 million one-time benefit, that just a little bit does still grow 17%.

Power generation cost of sales increased by $20 million, driven by a $23 million diesel cost increase, primarily due to a 38% increase in the diesel price, past shifts set by a 7.5% decrease in consumption, each in Nigeria.

As previously highlighted, we have a locked in price interest significant portion of our diesel needs through September of 2023 and through Project Green we continue to prioritize alternative sources of power to reduce our dependence on diesel.

On site 12, we first review our recurring lentifi cash delay.

We generated RLSCF of $150 million in Q123, a 72% increase versus Q1 last year, due to a combination of factors including the increased revenue and adjusted the dollar discussed already in particular the one-time payment in Nigeria, which had a net $43 million positive impact on RLSCF.

These factors were offset in part by increases in net interest paid, least payments made mostly due to cell effort for a connect position, and withholding tax.

Our RLSCF cash conversion rate was 44.6%, excluding the non-recurring revenue in the quarter, our RLSCF still grew 23% despite the higher energy and higher interest rate environments in this quarter versus the prior period.

So, to CAPEX, then the Q1 23, CAPEX, with $153 million increased 30% year on year, the increase was again primarily due to increased CAPEX in South Africa and connection with the refurbishment of the portfolio acquired during 2022. Also, increased CAPEX in La Femme, primarily for high systems, and increases in Nigeria in connection with Project Green, on which we spent $34 million in the quarter.

And so, this is the segment review on slide 13. I'll first walk through our Nigeria business. And Nigeria macro remains challenging as we discussed in late March. US dollars continue to be difficult to source, although remain available with FX reserves in the country having decreased the $35.5 billion at the end of March.

from 37.1 billion dollars at the end of 2022. While the price of oil has decreased quarter and quarter, the ice gas oil price remained elevated versus a year ago, reflecting the start of the Russian Ukraine conflict in Q1 of 2022. It is the most relevant indicator of the diesel pricing we pay. Looking at ice gas oil, it was $819 per ton in Q1 2023.

down from 948 dollars per ton in Q4 of last year, but still above the $786 per ton in Q1 2022.

Moving to real GDP growth, it expanded by 3.5% in Q4 of 2022 with a projected full year 2022 growth of 3.2%. While inflation increased to 22% as March, versus 15.9% in March 22. It, importantly, on May 29th, present the left boiler.

businesses. We also continue to work closely with various regulators, our vendors and our local banking partners to continue to best position IHS. Also, we believe the business remains well positioned for continued long term success and to enjoy the near-term macro-organic challenges.

So this point and I do your business once again to deliver strong results in the first quarter tracking well on our key metrics. Q123 revenue of $425 million increased to 3% year on year on a reported basis and 47% on an organic basis. In each case also reflecting the one time revenue discussed. Top line growth is driven by the usual group of power related revenue.

remunies well destroyed.

A co-location rate consequently improves at 1.57 times up from 1.52 times in Q122.

These amendments continue to be a strong driver of growth with these increasing by 13% quarter to strong quarter as our customers added additional equipment to our sites, particularly 4G upgrades.

Q1 2023 segment adjusted EBITDA in Nigeria was $272 million, a 34% increase from a year ago, and segment adjusted EBITDA margin was up 70 basis points to 64%.

Let me now briefly summarize the results of our other segments.

As our Sub-Saharan African segment now reflects the inclusion of our South African business, Tows and Tents increase substantially versus Q1 of 22.

Revenue increased by 43%, which organic revenue grew 16%, Eorganic revenue grew 33% driven by the South African acquisition, and FX was a 6.2% headwind.

Second adjusted EBITDA increased by 39% driven primarily by the increased revenue, past offset by increased in power generation costs, maintenance and security costs, and administrative expenses. Second adjusted EBITDA margin decreased at 53.5% from 54.9% in Q1 of last year.

We continue to monitor the macro environment in South Africa, particularly the ongoing power load sharing by the National Utility and as previously discussed, we continue to evaluate managed services opportunity there.

In our last AM segment, TOWs and tenants grew more modestly by 3.4% and 9% respectively, reflecting the closure of the GTS SP5 acquisition in Q1 last year. However, revenue and segment adjusted EBITDA each increased by over 40% in Q1 2023, largely due to the timing of the closure of the deal last year.

as well as the ice systems by the business. In Brazil, our second largest market was 7,022 towers. Mapro conditions were largely stable as GDP growth was deteriorated. FX rates marginally strengthened, interest rates helped steady, and inflation decreased.

In our LATAM segment overall Q1 2023 organic revenue increased 18% driven by an increase from iSystems, CPI escalators, new sites and new co-location with inorganic revenue increasing by 27% from the acquisition.

Second adjusted EBITDA, agreed by 41% in the quarter, with a second adjusted EBITDA margin of 68.3%, reflecting the increased revenue, but offset by increase in the Ministry of Expenses, including increased staff costs and about to land.

In May, the 2010 is each group by 8% in Q123 and revenue group by 13%, including 11% organic revenue growth. Second adjusted EBITDA group by 1% in the quarter, with a second adjusted EBITDA margin of 37.6%, reflecting the increased revenue but offset by increasing cost of sales and other than the initial expense.

19104, up 17 and a half percent from the same period last year, driven largely by the acquisitions mentioned and ongoing new sites in Latin, Nigeria and SSA. We'll be it down by a next 548 hours since the end of 2022.

As you can see in the chart on the top right collectively, we built any 200 towers during the first quarter of 2023. But as Sam mentioned, we also rationalized 727 towers occupied by our smallest heat customer in Nigeria, where we were not generating revenue. Tower tenants grew 17% with a co-ocation rate at 1.49 times.

Flat versus last year, but up slightly from Q422.

We continue to point out that lease amendments are a significant factor for us, particularly in an amateurian segment given the ongoing 4G upgrades by our customers there. And the initial will be a small five-jectivity we are seeing.

While lease amendments increased by almost 16% year on year, they are not included in our medication cancellation. We continue to see no reason why we can't get to two times or greater on our overall portfolio over the long term and have more mature portfolios of towers or apps or above that rate. On slide 15, we look at our capture structure and related items.

At March 31, 2023, we had approximately $4.06 billion of external debt and I have rest 16 lease liabilities.

Of the $4.06 billion of debt, $1.94 billion represent our bond financings and other indebtedness includes $370 million that we drew down in 2022 from the $600 million three-year bullet term loan at the IHS holding limited level.

Additionally, it's discussed on our Q4 earnings call. In January of 2023, we entered into an up to 165 billion NIRROR five-year term loan and an up to 55 billion NIRROR three-year RCS.

In connection with this, we've repaid 114 billion NIRR of our two Nigerian local currency facilities. And as you see at the table, removing significant 2023 amortization.

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That we previously stated we're very pleased to have completed the recent Nigeria refinancing, which further de-risked the balance sheet and increased our financial flexibility, particularly in light of the tough financing conditions that remain across the globe. Caching cash equivalents were basically flat at $516 million at March 31. In terms of where that cash is held, approximately 10% of the total cash.

again at the end and last year and through which we have upstreamed $75 million across December 22 and January 23. And as salmon noted, we have upstreamed an additional $50, $50 million in Q2 23.

Consequently, all these moving elements at the end of Q123, our consolidated net debt was approximately $3.5 billion. And our consolidated net leverage ratio was 3.1 times down slightly from December and at the low end of our net leverage target range of three to four times. Further demonstrating our strong value sheet.

On to slide 16, we're reiterating 2023 guidance that includes revenue in the range of 2.19 to 2.22 billion dollars. Adjusted the amount are in the range of 1.2 to 1.22 billion dollars. Our LFCS in the range of 430 to 450 million dollars.

and total capex in the range of $610 to $650 million. As some mentioned, while we've recognised the modest upside in Q1, including the updated FX rates, given FX rates in emerging markets can be volatile, and we still expect a notable devaluation in Nigeria this year.

We think it's important that we remain prudent in our operation not to increase our guidance.

Guideds also continues to include approximately $25 million of power pass through revenue in in South Africa of which we recognize $1.4 million in Q123.

I do want to again caution that timing of such moves is difficult to predict and could be delayed relative to what we've assumed, although this would have no impact on adjusted at all.

Guide us also continues to not include any revenue from e-tips, although we continue to evaluate opportunities in the market that we could align with our financial and strategic objectives.

I also want to point out again that we have locked in pricing for its significant portion of add-deas will need in Nigeria through September 2023, which in turn will provide greater visibility to our costs.

For the year, we continue to expect to build approximately 1,200 towers, which is slightly more than the amount we built in 2022.

This includes a nice bullrocket night area as we pull back on new side builds as we shift more of our focus to project green. But also includes a triple-leg of tower builds in Brazil that will be back and loaded in 2023.

On slide 17, on the top you can see revenue by reporting currency for Q123, whereas on the bottom we provide the breakout of revenue based on contract split.

The right side shows the average annual FX rates, assumptions that we use in 2020's 23 guilets, and have been updated slightly since last quarter.

This equates to $14 million upside to the year versus rates assumed last quarter. This now brings us to the end of our formal presentations. We thank you for your time today, and operator, please now open the line for questions. Thank you. As a reminder, for those on the phones, press star one to raise your hand.

We will now pause briefly while we register questions in the Q&A roster.

Your first question comes from the line of Phil Qsic with JP Morgan. Please go ahead.

Hi, guys, couple of things. Thank you. Let's just dig a little deeper into Nigeria. There's a new government. You've mentioned a couple of times a devaluation expected. It sounds like you've paired down your cash pretty aggressively getting ready for this, but just give us a little bit more on your thinking.

Hey, Phil. So not too much has changed since we last spoke in March. Mr. Tnubi had been elected in February , which is obviously still the case. We've got the inauguration coming on 29th of May. And the policies that Mr. Tnubi continues to sort of champion.

are the ones that we've mentioned before around potentially tackling the FX rate and the fact that it continues to be undervalued. Hence our comments around continuing to believe that there could be a devaluation of the currency during the course of 2023. The fuel subsidy as well that continues to be a hot topic in Nigeria if and when that may get ramped down, phased out.

their build pace or anything like that or everything is just running a pace.

Not significantly now, we're continuing to see that likes of MTN, in Nigeria, the likes of Air for the Nigeria continue to push forward with their rollout. They're pretty focused on 5G at the moment. And by that, I mean focused on...

figuring out exactly how best to get that to the population, which we've said before won't initially be thousands of thousands of sites being rolled out, but it will certainly start adding incrementally to the infrastructure needs of the country. And indeed, we've seen that in Q1 a little bit and in Q4 a little bit last year as well. So no significant changes, I would say the carriers are continuing to behave.

And your leverage is running at this point at the low end of your target range. Does that make you think any differently about either how you would structure things or what kind of deals you would want to do? Thank you. Thanks, Phil. So in terms of our position, maybe I start there. I think we have intentionally been on the process.

and the opportunity we visited South Africa, which we thought was very strategic to us. But for us, it's largely about how strategic it's gonna be and how expensive or how cheap can we get a G. done. That's the important part at the moment. Now, having said that, I think there has been a dislocation between public valuations and private valuations, the private expectations, the private sector.

There are a few processes out there in the Middle East at the moment. They're taking their time, but at some point I think transactions will have to start happening. And they're not going to be at the high multiples that we've seen 18 months ago or 24 months ago. So hope that answers your question.

In the meantime, with your leverage at the low end, would you think about buying stock? How do you think about the need for liquidity versus taking advantage of the share price?

Look, I think this year is kind of like slightly different because we are in a very good position. Last year we wanted to make sure we kind of like our balance sheet is tight, it's ready for, for, for, for come what may. And I think Steve and the team have done a wonderful job in kind of like pushing maturity further.

bringing more debt into the local currency. Even our overall cost of debt remains somehow subdued. So yes, at the moment we are sitting at low leverage which enables us to probably try and do more. But again, I don't think the word is out of its tunnel, I think.

The interest rate yet to be seen, how are we going to control inflation? Where does Europe stand? The EU political tension with China. So I think we are still in a phase that requires the pros. Now, if it is presented to itself that it's cheap enough, it has to be good commercials, it has to be strategic, we can do it. It's as simple as that. But we're not in a rush. Thanks.

and how much of that is factoring, and maybe the uncertainty of the devaluation. And then second, just to ask again on devaluation, can you help me with the mechanics of it? Suppose there's a devaluation tomorrow. How quickly are your effects and CPI reset?

is it monthly, quarterly to catch up with that, if you will, thanks. Hey Greg, so I mean, what you said, what your outline and sense of the guidance is exactly how we've tried to portray it, exactly how we're thinking about it, which is, yes, we've had some positive performance in Q1.

helped by some positives here on the FX, etc. So we have tailwind there, but as you said, we're only at Q1. We are taking again a cautious position around potential future currency devaluation, particularly my deal we've just spoken about. So our view right now is to layer a little bit of caution into the guide and not change it.

but we're certainly pleased where we are within those ranges, you know, the upper end, etc. So, yeah, that's exactly the thinking and the fact pattern around maintaining guidance as is for now. And then on your second question around, as and when, if devaluation happens and was specifically referring to Nigeria here, of course,

effects resetting perspective. The vast majority in fact 94% of those contracts are resetting on a quarterly basis. So the devaluation would happen tomorrow in your example. They would start to reset from the first of July being the next come to court of commencing.

Now they're not all spots, I'm not taking the average of FX rates etc, so you see that reset come through the next quarter and the following quarter. So that takes care of the FX side of things and then from a CPI perspective, majority of CPI escalations are passed annually, in fact pretty much all of them.

Got it, bye, bye, thank you.

Your next question comes from the line of Brett Feldman with Goldman Sachs. Please go ahead. Thanks for taking the question. I guess I'll probably stick initially with the potential devaluation. You sort of alluded to it, but obviously it would be helpful to your Nigerian base.

Dead balances, it sounds like you pull down a lot of cash, so I don't think that that would be

with your tenants, because a significant evaluation can make it more challenging for them to pay their bills, particularly bills that are tied to hard currencies. Anything we need to be contemplating there, and I have a follow-up question on Project Green.

Yeah, sure, I'll start taking that one. So in terms of anything else to be thinking through on potential devaluation, we do see unrealized FX losses in case of devaluation, which is effectively our third party dollar debt, although in the case of 90, that's another zero, so we won't see that.

but shareholder loans, which is how we historically pushed money into the country. So these are internal shareholder loans to be clear. Those are denominated in dollars and so you can see unrealized FX losses there, but that will pass through the bottom of the income statement. It won't affect any KPIs, but you will see that come through if there is a devaluation coming through. In terms of customer discussions, I think there's a lot of things to keep in mind around the customer discussions. I mean firstly, our key customers in Nigeria continue to be very healthy. So MTN and AirTL continue to grow their businesses really significantly. MTN about 19%, AirTL about a similar 20% revenue growth in the last quarter results.

Just on project green, obviously, it's still early days that you seem like you're making the progress against that initiative. Any early anecdotal color you can give to us in terms of the extent to which it's yielding the benefits you had anticipated or is it just too soon.

Yeah, it's a little too soon. So we'll look to get to that later in the year. But I would say it's very much on track. We're in that phase where only Q3, Q4, Q1, and a little bit coming in Q2, is really the timeframe to get the capex out the door, to get all those solutions, grid connectivity, battery. So.

Once again, ladies and gentlemen, if you have a question, it is star one on your keypad. Your next question comes from the line of Michael Rawlings, Rawlings with City. Please go ahead.

Thanks and good morning. A couple of follow-ups. So just looking at slide 10. If you add together the CPI and the FX reset. ...jmand???ir Einsatz. ...Title back as desired..........

The FX headwind to the right is a little larger than the combination of those two items, the escalation and the recess. How should investors be thinking about this relationship on a go-forward basis? Is it a net positive, net neutral, net negative? And is that the right way to think about that, there's a relationship between all three of these.

components of the revenue bridge. And then just secondly, just taking a step back on some of the capital allocation strategies and some of the points that you outlined earlier. Are there any new ideas or updates on how the board and management team would like to translate the operating performance?

into creating shareholder value. Thanks. Sure, I'll take the first one. I'll have you start on second with Soundconjumping as well. So on the first one, yeah, you're absolutely right in the way of thinking about that. So I'd like to talk to people about the building blocks in this growth bridge, CPI escalations, plus FX reset to versus.

the FX impact at the end of the bar. There is of course timing nuances, these are very binary quarterly snapshots of our growth and so in the case of this particular quarter, when you look at FX reset setting 3.4%.

Yes, we had CPI escalated at 7.3 but against FX negative at 11.3, give you one example which is the majority of what's happening there this quarter. In Nigeria, average billing was around $444,000 to the dollar because some of it's based on spot and some of it's based on average of the preceding quarter.

about it and it should be net positive overall. That's what we've seen historically. It's not hugely, hugely net positive, but it's certainly a positive when you combine TPI and FX reset versus underlying currency performance. I'm Michael. I'm Michael.

on the capital allocation points. Clearly, it's the board's mandates to continue assessing these along with management. So we keep looking at all the different options between investing in the business, in organic activity, things like buybacks, or other forms of capital allocation. So that continues to be a hot topic of agenda for us and we'll continue.

But let's not forget we listed barely 18 months ago. We listed at the beginning of a downturn and the global economic cycle. Now, of course, this will reverse at some point in time. The most important part for us is again, to kind of like be there in the public eye, quarter after quarter, showing what we can do, what our markets can do.

down or control our energy costs among our other things. We need to keep growing organically in double digit, et cetera, et cetera. So the most important thing is to keep doing these things quarter after quarter. And of course, the second part of the strategy is communications. That's why we kind of like have Colby now on board.

as they're over time to increase the size of our slow to remember the slow to remain an inhibitor, the size of the slow to remain an inhibitor to kind of like realising proper valuation potential. Now having said all of this, the company and its board periodically we evaluate strategic options. What else can be done?

Can we do this? Can we do that? Can we run a secondary offering? Can we do this? Can we do that? It's by the fact that I think to do. I mean, we constantly evaluate things. And at the appropriate time, if we feel that some of those strategic options are worth tapering, then we would put it forward.

Do you have any interest to attract minority capital into certain investments that you have as a way to maybe increase capital to recycle with four acquisitions while also trying to manage the valuation of which the capital comes in?

As in when it is appropriate at the time we look at these things, but at the time we have no definite plan to Move with any of these options

Thank you. Thanks, my too. Your next question comes from the line of Boroughly with RBC. Please go ahead.

Good morning. It's Bora Leon for John Atkin. So, two questions from my side. Can you remind us how you're viewing the opportunities for rural build-out and fiber deployment in Nigeria and how meaningful that could be over time? And then secondly, touching on Latin America.

What are you seeing in terms of carrier activity there? I'm just curious if they're still going through that digestion period post-oy and when you think that might influx. Hi, Bora. So, in terms of Nigeria, so rural activity is still around. Wheater and Willmar in my initial thoughts is a question of adaptation to life within our region. So, after calculating that, I wouldn't really think that they would be on... So, just as a general story, what do you don know about some of the factors interacting with those populations?

As we mentioned a few times, we're outsized, diverting, if you'd like, capital into project green, which we think is a huge beneficial project for the country as well as for IHS. So that's really driving that. Fiber opportunity continues for sure in Nigeria. We're continuing to roll out what we call the last mass of the fibre piece where we connect our own towers.

which is effectively extending our infrastructure services to the entity, the customers that are already on the towers. So that does continue, but just give you an idea. I mean, fibre across the entire group represents something like 3.5% of our revenue. So that is Nigeria and our systems at Brazilian Business combined.

So it still remains a reasonably small part of our business. I would say standing back from numbers strategically, we do feel like there is, opportunity for the right part of fibre within IHS over the short lead in the long term. Do you think fibre connectivity is the key to successful backpool particularly on 5G, but even on 4G?

of that. I would say it's starting to free up a little bit. I think you're going to see our activity ramping up through the course of 2023, particularly on the new build side. We've started off with a reasonably modest number of tiles built in the core of one, but I can tell you it's already accelerated in Q2. And so we expect to see that continue to ramp through the course of the year.

I would say it's starting to free up a little bit. I think you're going to see our activity ramping up through the course of 2023, particularly on the new build side. We've started off with a reasonably modest number of tiles built in the quarter one, but I can tell you it's already accelerated in Q2. And so we expect to see that continue to ramp through the course of the year. Thank you.

Your final question comes from the line of Stella Cridge with Barkleese. Please go ahead.

Good morning everyone, many thanks for all the updates. If I could just follow up and ask, what was the rate at which you upfinned the effects in Q2 from Nigeria? And I wanted to ask on South Africa, so I know on the last call you had commented that the mobile operators had to take some decisions about how they wanted to address the energy crisis.

the second teeth can take the first one. Let me start with the second one. Look, I think no one disagrees with the fact that Parchez is one of the most experienced power pose who can run power solution on the whole world at the moment.

In our experience in Nigeria, for the past 24 or 25 years, basically, we've done that in a country with at the moment, 225 million people were 95% or more of the size, don't even have a good connection. So the experience is there. Now, at the moment, we are listed in the New York stuff, on the New York stuff stage, we are, we have an equity story to tell.

It's going to be used in whatever form. Whether we actually do the service, whether we consult, whether we become technical partners, whether we provide the services, it is basically at the decision of our partners. And then, still, on the second one, pretty short shot answer. We haven't disclosed the right $50 million. Historically, we disclosed our rights.

at the end of each year. So we haven't done it. So far.

We haven't actually disclosed details about yet, there were upstreams from other countries as well.

That brings us to the end of the IHS holding limited first quarter 2023 earnings results call. Should you have any questions? Please contact the investor relations team via the email address investor relations.

at ihstowers.com. The management team, thank you for your participation today. And wish you a good day. You may now disconnect.