reports
- Chris Hoare
- Chris Hoare
- Chris Hoare
African Telcos Deep dive on Fintech valuations; stay Bullish on AAF a...
We deep dive on African Telco’s Fintech valuations in this note which is a follow up of our higher-level note Show me the (Mobile) Money. African Telcos are becoming more active about unlocking value from Mobile Money (MoMo) with MTN’s recent deal with Mastercard and now rumours that AAF is looking to IPO its MoMo business. Global Fintech/Payments multiples have derated over the past couple of years, but we continue to see great value in the African Telco’s MoMo assets which remain one the key n...
- Chris Hoare
5G FWA in EM Poor man’s paradise; income and propensity to spend sugg...
This is the 3rd in a series of notes looking at FWA (see HERE and HERE). Like us, the market appears to be getting more bullish on FWA in EM, and a series of events such as Jio’s launch suggest FWA could be a significant use case for 5G in Emerging Markets.
- Chris Hoare
IHS Towers (Buy, TP: $10, +104%) Further thoughts on IHS’ MTN contrac...
10 days ago MTN announced it would not be renewing a contract for 2,500 tenancies with IHS in Nigeria. This is a global first in the Towers space we believe (a financially healthy operator choosing not to renew an expiring tower contract).
- Chris Hoare
MTN (Buy, TP: ZAR250, +79%) MTN Group - Q2 23: Solid results, Fintech...
MTN has reported a solid set of Q2 results. Group service revenue trends were stable while EBITDA trends accelerated. But the key announcement today was that of a commercial partnership through the signature of a MoU for a minority investment with Mastercard on the fintech side.
- Chris Hoare
- Chris Hoare
MTN (Buy, TP: ZAR250, +125%) MTN Group - Q1 23: A slower quarter as e...
MTN has reported a slower set of Q1 results which is not surprising given Nigeria, Ghana, and Rwanda already reported slower results earlier and the issues around load shedding/network availability in South Africa have been well flagged in the previous quarter.
- Chris Hoare
MTN (Buy, TP: ZAR250, +111%) MTN Rwanda - Q1 23 Quick Take: Slower qu...
Like MTN Nigeria and MTN Ghana last week, MTN Rwanda has reported a slower set of Q1 results, mostly because of the challenging macro environment and an increase in wholesale costs. MT guidance of “low to mid-teens growth in service revenue” is maintained.
- Chris Hoare
- Chris Hoare
- David Lopes
Nigerian Telcos Improving top line driven by voice recovery; stay con...
Both MTN and AAF saw improvements in top line growth, driven by the recovery in voice in Q4. MTN slightly outperformed AAF in service revenue but AAF outperformed on the EBITDA side and with low capex intensity in Q4 AAF posted strong OpFCF margins.
- Chris Hoare
- David Lopes
- Chris Hoare
MTN (Buy, TP: ZAR250, +71%) MTN Ghana – Quick Take – Q4 22: Decent Q4...
MTN Ghana has reported a decent set of results with solid top line trends but slowing EBITDA trends that are still being impacted by the macro. The company has provided medium-term guidance for service revenue growth of “low-twenties” vs. “mid to high teens” previously which is encouraging.
- Chris Hoare
- Chris Hoare
- David Lopes
New Street: African Telcos & Towers Outlook 2023; Politics & Macro
2022 was a tougher year than we expected for African Telcos & Towers. While fundamentals remained generally good, the war in Ukraine and its impact especially on fuel prices as well as other macro pressures created some strong headwinds. While some of these are perhaps inflecting, we think in many ways 2023 will remain a tough environment, with headwinds in South Africa and the Nigerian election.
- Chris Hoare
- Chris Hoare
New Street: EM Telcos Growth stays strong in Q2, despite fears over i...
Despite fears that EM ARPUs would be impacted by rising food and energy prices (which we always felt were overdone), growth in Q2 remained strong for the leading telcos we track. In fact, with Brazil the latest market to see growth improve (albeit remaining below local inflation), Q2 represented another quarter where a simple average of growth was above 10%. Our thesis remains that EM telcos are set to grow sustainably at GDP+ rates.
- Chris Hoare
New Street: South African Telecoms CY22 1H review – Resilient growth;...
It was a tough environment for South African operators in the first half, impacted by continued network disruptions due to loadshedding. EBITDA growth stalled and margins were eroded as telcos turned to backup batteries and power generators, further exacerbated by rising fuel costs. On the mobile side, post-paid segment fared better as pre-paid was more impacted by inflation and delays in social grants.
- Chris Hoare
- David Lopes
New Street: Sub-Saharan African Telecoms Q2 22 review: Decent growth;...
Sub-Saharan Africa (SSA) operators saw a decent Q2 as subscriber growth remained strong. However, ARPU growth eased, in part due to the e-levies and reduced P2P fees on fintech services. Airtel Africa (AAF) was the outperformer again while MTN’s EBITDA margin was more resilient.
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