MWC 2024: what we learned

We attended the Mobile World Congress in Barcelona. Significant potential for improved 5G monetisation, leading to higher potential 5G capex.

Time to prove the cash generation

Solid Q4 but supported by large B2B contracts. '24e FCF up 47% on savings, lower capex; improved Colombia outlook. Lease adj. FCF yield of 16%, but not meeting CoE requirement - HOLD.

Strong '24 FCF guidance 49% above cons

Q4 likely to be the trough

Q4e: major restructuring costs weighing on EBITDA. Limited organic '24e revisions. Keep HOLD - wait for cash flow proof.

'22-'24 EFCF target upgraded by ~20%

Positive signs, but uncertainty remains

Millicom's Q3 results were solid vs. expectations, with the company continuing to hover around 2% organic service revenue growth driven by Mobile, while Home remains muted.

Q3 OCF 19% above consensus

Not ready for re-rating – HOLD

Soft Q3e, but slight improvement q-o-q: EBITDA down 1% y-o-y org. Change of analyst – review of estimates and rating. Guatemala needs to prove recovery, down to HOLD (Buy).

Risks on many fronts

Q2 sees Guatemala weakening and home pressures. Strengthening spectrum positions in main markets. DOJ investigation remains a risk.

A long wait

Q2 results and lower financial targets pre-announced in June. '23e-'25e reduced, TP down to SEK 200 (250). No near-term catalysts and a bid is uncertain.

Another blow to confidence

Apollo discussions terminated

Tower transaction and buyout prospects

Q1 EBITDA below on higher Everest cost. Estimates: '23-'25 EBITDA -2-3%, EFCF -10%. We consider eventual Atlas buyout likely: BUY.

Q1'23: climbing Everest

Q1 results on 27 April: weaker macro trends. Estimates adjusted for higher Everest costs. Investors kept in limbo on bid prospects.

The start of a sustained recovery

Sector recovering from sharp H2'22 underperformance. '23e: positive growth outlook with cash flow to recover. Among Nordics we prefer Telenor and Telia Company.