Helios Towers PLC (lon:htws)
Helios Towers – A New Float With A Huge Debt


ItemCurrent PeriodPrevious Period
Period3 Months3 Months
Adjusted Earnings
Adjusted EBITDA$54m$49m
Statutory Profit($61m)($94m)
Adjusted Profit
Total Debt$671m
Net Debt$653m
Title: Helios Towers – A New Float With A Huge Debt
Company: HTWS - Helios Towers PLC
Share Price Then: 160p
Author: Ian Smith
Date: Fri 12 Jun 2020
Comments: Helios Towers are a FTSE 250 company that I have never heard off, floating in October 2019 at around 120p.

They own and operates telecommunications towers and infrastructure in five high African countries, they have about 7,000 sites with roughly 2 customers per site, a customer being a mobile network operator.

Operating in in Tanzania, DRC and Congo B, Ghana and South Africa
Operating profit is up to $12.1m from $7m which is wiped out by a loss of $41m on derivative financial instruments and $29.3m of fiancé costs.

The finance cost covers around $700m of debt, which has to be repaid from revenue received in the local currencies.

The derivatives loss is associated with a $600m bond which appears to have currency and interest hedging requirements, so the $41m loss is not a total disaster as they have been previous profits in the same order. This $600m is due for repayment in March 2022.

The reports like to talk about adjusted EBITDA, in this case the adjustments include the losses mentioned above and $31m depreciation of property, plant and machinery.

"I am particularly proud that we have now delivered twenty consecutive quarters of adjusted EBITDA growth driven by continued tenancy growth and operational efficiencies." Kash Pandya Chief Executive Officer

This all seems a bit worrying to me, EBITDA is bad enough, but adjusted EBITDA and a massive bond payment in a couple of years.

I certainly get the business and understand that it is capital intensive, but I don’t see how it can escape its debt burden, especially as it is a newly floated company.
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