Good day and welcome to the IHS Holding Limited Results Call for the 3-month period and Full Year ended December 31, 2021. Please note that today's conference is being webcast and recorded. [Operator Instructions] At this time, I'd like to turn the conference over to Colby Synesael. Please go ahead, sir.

Thank you, operator. Thanks also to everyone for joining the call today. I'm Colby Synesael, the new SVP of Communications here at IHS. With me today are Sam Darwish, the Chairman and CEO of IHS Towers; Adam Walker, CFO; and Steve Howden, Deputy CFO. This morning we published our financial statements for the 3-month period fiscal year ended December 31, 2021 on the Investor Relations section of our website and issued a related earnings release and presentation. These are the consolidated results of IHS Holding Limited, which is listed on the New York Stock Exchange under the ticker symbol IHS, which comprises the entirety of the Group's operations. For we discussed the results, I'd like to draw your attention to the disclaimer set out at the beginning of the presentation documents on Slide 2, which should be read in full along with the cautionary statement regarding forward-looking statements set out in our earnings release and annual report on Form 20-F. In particular, the information to be discussed may contain forward-looking statements, which by nature, evolved 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 results future results, performance or achievements or industry results expressed or implied by such forward-looking statements, including those discussed in the risk factors section or 20-F filed with the Securities and Exchange Commission today, and our other filings with the SEC. We will 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 metric 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 Darwish, our Chairman and CEO.

Thanks, Colby. Welcome, everyone. Thanks for joining our Q4 and the financial year 2021 earnings results call. The second such call following our listing on the New York Stock Exchange last October. Welcome also to Colby, who just joined us at the start of March. Today I'm going to run through our 2021 highlights, an amazing year for IHS and also touch on how we are building a global digital infrastructure company that we believe will deliver long-term growth and value creation for our shareholders. I will also discuss how our focus on sustainability is core to our business model, a focus that has been at the heart of IHS since I founded the company in 2001. Then I will turn things over to Adam and Steve to take you through the results in greater details, after which we will open the line for Q&A. Slide 4 of the presentation highlights IHS key accomplishments in 2021, many of which occurred during the fourth quarter, a very exciting time for us. As the leading independent multinational company focused solely on emerging markets, IHS ended 2021 with over 31,000 Towers spanning nine countries on three continents. We continue to focus intently on executing our organic and inorganic growth strategy, including our objectives to further diversify our asset base and lower our cost of capital. And we are pleased with the multiple steps we’ve taken recently in support of this strategy. With our current and near-term growth driven largely by the implementation of 4G in our main markets of Nigeria and Brazil, we are very happy to see that 5G is now on the horizon as well. And our recent acquisitions are all designed to position IHS to benefit from the coming technological transition. In addition to our October IPO on the New…

Thanks, Sam and hello, everyone. Today I will cover our key tower, tenant and lease amendment KPIs and discuss our revenue EBITDA and RLFCF results for the year just ended. Turning to Slide 8, as mentioned, the business performed really well in 2021. And you can see our towers, tenants and lease amendments have all increased versus the prior year. Moreover, IHS delivered double-digit growth in both consolidated revenue and adjusted EBITDA in 2021 versus 2020, whilst expanding our EBITDA margins and our recurring leverage free cash flow grew by 8% versus the prior year. Our level of investment to CapEx to grow the business organically increased by over 75%, and given our high levels of cash generation our consolidated net leverage ratio has decreased versus the prior year, despite the inorganic activity. Turning to Slide 9, our tower count is now over 31,000, up by over 3,000. This was driven largely by our acquisitions in LatAm, and the ongoing new site programs there as well as the new sites activity in Nigeria, with both new build programs accounting for most of more than 1,300 towers that we built during the year, 597 of which in Nigeria, and 600 in LatAm. Please note that unlike the U.S., our markets have characteristically de minimis churn. Total tenants grew 8.3% year-on-year to 46,414, with a colocation rate of 1.5. Two things to remember in relation to the colocation rates, which we define as total number of tenants divided by total number of towers. First, lease amendments, which are a significant factor in the growth in our Nigerian segment are not included. Second, when you are a significant acquirer and builder of towers, as we are, then you are typically adding to the denominator period-on-period even as we continue to lease up the…

Thanks, Adam. Onto Slide 14, you see the CapEx was $402 million for FY '21, a 76% increase versus last year, primarily due to us investing in the business for growth. Driving the increase was increased augmentation in new site CapEx in Nigeria, in connection with lease amendments delivered for our customers and for our rural solution, as well as the increased new site CapEx in LatAm. CapEx was $151 million in Q4, 131% increase versus last year's period, in light of the same drivers just mentioned. However, as we discussed in our Q3 call, we did underspend in terms of CapEx during the year as a result of the global supply chain issues rippling across our markets. Similar to companies around the world, we are seeing a slowdown in the supply chain continue into 2022, which we are trying to mitigate by ordering equipment earlier in some cases 1 to 3 months earlier. Financially speaking, this impact is small and has been factored into our guidance for FY '22. But noting the continued uncertain macroeconomic world, in which we live at the moment. Slide 15 looks at our returns and capital allocation. In FY '21, we continue to focus on driving our returns and delivered a return on invested capital of 11.2%. We invested significantly in both organic and inorganic growth opportunities during the year, including new site build investment in Nigeria and LatAm, closing and integrating the acquisition in LatAm, albeit with only partial contributions in the year from some of those acquisitions. In terms of capital allocation, you can see on the right that a significant portion of our FY '21 spend of $401 million related to acquisition investment, and this was deployed to build upon our 2020 entry into LatAm. As Sam mentioned earlier, we believe…

Thank you. [Operator Instructions] Our first question is from Jonathan Atkin of RBC Capital Markets. Jonathan, go ahead.

Hi. This is Bora Lee on for Jon. Thank you for taking the questions. You note on Slide 22 that other key components of diesel in your cost structure includes the percentage mix at imports versus locally sourced diesel and which we buy it in the spot market or futures. To do a bit of a deeper dive into what that sourcing that’s currently, and what are the factors that would impact the mix of imports versus local and spot versus futures purchases.

Hi, Bora. Steve here. So, a variety of different items go into that sourcing strategy. We don't sort of disclose minutiae detail around that, but we look at what is the price of the local market, what is the price of the import market. What is the availability at the right times in terms of delivery for what we need, and how much of that availability can we afford purchase. And all of that sort of supply together with pricing combines to give us a constantly moving mix between whether we're sourcing locally or importing. So, it's a complete balance, and it's dynamic, it keeps moving. That's sort of a key way we can control supply and price.

Thanks. And can you also provide some color around what you're seeing in facing of losing activity in Nigeria and touch on deployment of spectrum following the auction?

Yes, I mean, we've had another very significant year, and certainly H2 of last year 2021 coming from leasing activity in Nigeria, a lot of it coming through in lease amendments, as you've seen through Q3 and Q4 results. The revenue guide we've given you is another 14%, headline growth, and a significant amount of that organic activity being driven out of Nigeria as well as we expect to see colocation some new site builds as well, but also lease amendment activity continue. Most of that lease and M&A activity still driving off 4G. We -- as we said, we have now seen 5G spectrum allocated. And we have some what I would call de minimis orders for FY '22 on 5G rollouts. So great news for the industry. The carriers are just starting to think about how best to deploy that network. I don't think we're going to see a huge impact of it in 2022. But certainly, we have some initial orders, and it'll be a 2023 onwards item, in our view.

Thanks. And if I could, sorry, just squeeze one last one in. The industry has seen TowerCos use sales of minority interest to financial sponsors and formation of JVs as alternative sources of funding growth. Just curious what your views are on these types of funding vehicles. Thank you.

I think as a business, we're always looking at the optimal way to finance ourselves, and also create shareholder value. We've utilized minority stakes and joint venture partnerships within certain opcos around the group. We have one of those in LatAm right now with TIM in the fiber business that we started. Zain a very small element in Kuwait, and in South Africa, we're going to have minority partners in that particular acquisition when it closed as well. So, we've looked at it from a broader scale. I think that just depends on the value proposition. I think we like where the business positions, and we feel it's an incredibly well-placed business. So, if something like that would come along, we'd consider it.

Thank you.

Our next question is from Phil Cusick of J.P. Morgan. Phil, go ahead.

Okay. Hi, thank you. Thanks for the detail on the oil impacts. Margins in '22 are much better than we would have thought given that which is great to see. For that $7 million adjusted EBITDA impact for a $5 increase in oil prices, how is that split between Nigeria and the rest of the business?

Nearly all of it is Nigeria, Phil. So, in terms of how people think about the oil environment around IHS stock, it is almost entirely not totally, but almost entirely a Nigeria facet. If people remember that our MENA segment and our LatAm segment is effectively clear of energy, but given the power pass-through mechanisms that we have in place in those particular segments. And then our Sub-Saharan African business, there is some diesel in those -- in that particular segment, but there is also significant grid connectivity. So really, we're talking about Nigeria when we're talking about oil. So that $7 million is almost all Nigeria.

Thank you. And then let's dig more into the repatriating cash from Nigeria. You gave a number for Naira as a portion of your cash balance. What was that a quarter ago? And can you dig more into sourcing dollars from banks and talking about hedging as well? Thanks.

Yes, so obviously the quarter-on-quarter cash balance in Nigeria is dependent on where we are in the collection cycle. So Q3 was a significantly higher balance, it's more like $200 million. I can get the exact number for you, but that was because of when we had collected from our customers. As we went through the course of Q4, we then obviously deployed capital into the business and upstream some as well and hence the $81 million cash equivalent balance in Nigeria at the end of the year. And that’s something that we spoke about before that we continue to look to do as we collect from customers, we will ultimately look to service the needs of the business and then with excess cash have to upstream that and get it offshore. In terms of what we’re doing, I don’t think the strategy has particularly changed through the last 3 months. What I would say is we are continuing to push our banking relationships and our access to banks within Nigeria to see what different products we can access and that is with the aim of trying to target larger amounts rather than smaller slow and steady as sourcing. So, it’s not an easy market, but there is tower availability and we are working hard to continue sourcing what we want further year of 2022. Sorry, did I get all of your points?

Thanks. Yes, that was good. And then one for Sam, if I can. Sam, what does the acquisition pipeline look like? And can you talk to us about, you talked about Asia in the past, and does your stock price impair your ability to acquire portfolios? Thanks, guys.

Hi, Phil. Look, the strategy remains what we’ve discussed. We want to diversify. We see ourselves as a global emerging market infrastructure company, that’s how we see ourselves. We will continue to look beyond where our market are. Now having said that, we recently made moves into large markets. We made a move into Egypt, we made a move into South Africa. While we continue looking outside these markets, I would say the focus this year would be largely on these, like Brazil, of course. Now if something comes out that is so transformation and so strategic for us that is outside these markets, we will definitely consider. The share price is definitely not helping. But again, I see that as just a point in time. Other alternative funding could be available if something needs to happen quickly. But to be honest, at the moment I think would largely focus on our existing markets, especially given the uncertainties around the globe and where things are, well Ukraine, Russia. China yesterday now starting the massive lockdowns again, et cetera, et cetera. So that’s how we see 2022.

Thanks very much.

Thanks.

Our next question is from Greg Williams of Cowen. Greg, please go ahead.

Great. Thanks for taking my questions. Just on the guidance for revenue, what level of organic growth is factored in the other regions. You noted Nigeria has some strong leasing activity, but hoping you could provide some color on organic growth in the other regions? Second question is just on Egypt. I realize it’s not in guidance, but what’s your expectations on the cadence of signing new carriers? It is a first half story or is it back half loaded? Thanks.

Hi, Greg. So, in terms of the guide, the revenue range we’ve given you is 14.2% total reported growth at the midpoint of the range. That is roughly split 15% organic, 4% inorganic given the acquisition activity we’ve seen and with a 5% FX headwind. So that gives you an idea of the organic element 15%. And a big chunk of that’s coming through Nigeria and through LatAm where we are expecting more leasing activity, more build activity. We haven’t got into disclosing the exact breakdown of each building block of the growth components. But what we have also said is from a new build site perspective, we expect 1,250 new sites in Nigeria, and we are forecasting around 700 new sites in LatAm, I think that was Brazil and at around 270 in Sub-Saharan Africa and approximately 110 in MENA. Those numbers are slightly around it. So that’s how we’re thinking about the business. So obviously, Nigeria and LatAm are our key growth factors for the guide next year.

And Egypt?

Yes, sorry, and then, Egypt -- yes, and then Egypt, look I think, work in progress, so can’t say much until we have something to say. There’s lots of conversations going on, lots of discussions with carriers, different projects we’re looking at in assessing. So, as I’ve said on the last quarter, we will endeavor to keep you update quarter-on-quarter and as soon as we have something significant to report to you, we will let you know. Best guess, yes it would be second half before it starts impacting the business. But we will update you properly when we know more.

I mean, please remember that Egypt does not have a tower industry at the moment. I mean, we have the task of developing the business, but we also have the sort of developing that industry somehow, I mean it don’t exist at the moment. People are not used to the idea. So, if we have to do that part plus the actual part of getting the business, but we are making some strong headwinds.

Got it. Thank you.

Thanks.

Our next question is from Michael Rollins of Citi. Michael, please go ahead.

Thanks and good morning. I’m curious if we could focus a little bit more on the Slide 11. Can you remind us where churn in this bridge and what you saw from churn in the fourth quarter as well as for the full year 2021?

Yes. So, churn was about 1,200 for the full year. But of that 1,283 to be precise for the full year. But of that, 826, well what we call non-key customers. So outside of our important customers and that was really a cleanup exercise in terms of those customers that we were not looking revenue for and so we cleaned them up at the year-end and took them out of the tenant count. So, consider that 1,283 churn, 75% of that does not go to revenue. Another chunk of that churn was what we’ve disclosed previously around the 9 mobile piece. So, 269 of those was 9 mobile, which was part of our agreement earlier in 2021 to rationalize that business that we talked with you previously. So actually in terms of true genuine churn, very, very small through the course of the year.

And so where does that fit in these boxes on Slide 11? Which bucket is it in?

So, it would come through either new sites or new colocation depending on what it is, that’s coming off, whether it’s a colo [ph] or anchor tenant. But as I said, three quarters of that was not showing a revenue impact anyway, so it would not be picked up in a revenue bridge because there wasn’t revenue associated with it.

And you just in a previous question gave us a sense of what the total organic growth for '22. Can you break that out a little bit more into what the expectation should be for escalation, amendments and colocation? Just a sense of the drivers of internal organic growth for the business.

Yes, as I said on the previous comment, we haven’t broken that out in terms of the guidance. And what I would say to help people think through, it is, we think that is going to be pretty similar to what we’ve seen in FY '21, lease amendments will continue to lead the way and new sites and colocation will probably be similar type percentage contributions to what you see on Slide 11 of the presentation, and so reasonably similar. Organic growth as I mentioned to about 4%, so that’s a little bit higher given the acquisitions that we brought into the business during 2021. But from a kind of percentage contribution split, it will be not dissimilar to Slide 11.

And in the markets that you’re operating in and acquiring, should we be mindful of any carrier customer consolidation that might impact your future revenues from those regions?

No, not at this point, Mike. I think our markets are reasonably stable from a carrier consolidation perspective and the one that obviously jumps out is Brazil in terms of Oi [ph] Mobile, but we have de minimis next zero Oi Mobile exposure. So that one won’t impact us.

Thanks.

Thank you, Mike.

Our next question is from Simon Coles from Barclays. Simon, go ahead.

Hi, guys. Thanks for taking the questions and the extra detail in the presentation this quarter. And first one is just on CapEx. So, you said that you obviously had some supply chain issues. Should we think of the guidance that 2022 is of more normalized level? And how should we think about the mix versus the mix you provided on Slide 15?

Hi, Simon. So, I think you’ve seen this at a slightly wider range around CapEx in the guide and that’s on purpose given the items you mentioned around supply chain issue, the Russia, Ukraine pace, just at the point where supply chain was starting to free up again and we obviously as the world were hit with the Russia, Ukraine situation, so hence the slightly wider range on guide. We will keep you guys updated through the course. We’ve already factored in pricing increases, which we’ve seen around the business, which hasn’t been significantly material, but enough to factor in. So that’s already baked in that range and we will keep you guys updated as we go through. In terms of the mix. Again, we haven’t really broken it down. Anything I would say is, people often ask us from maintenance CapEx or the non-discretionary element, that’s going to be roughly 20% higher we think than FY 2021, reflective of the slightly larger business around new builds across different African portfolio, LatAm, but also obviously the introduction of full year of the fiber business as well. So, we think maintenance CapEx about 20% roughly, higher than the 2021 and then the rest is split between new builds and fiber, et cetera.

That’s great. Thank you. And just on that withholding tax comment you made in Nigeria and what that means for the recurring levered free cash flow. Could you just elaborate a bit more on that just to make it clear? Thank you.

Yes, I think we just want to make -- I mean, Simon, as we’ve been talking about since before, we left, but just wanted to continue making it clear to people that as we grow in Nigeria, we typically don’t suffer corporate income tax which is at about 30% in Nigeria. We suffered withholding tax on revenue, which offsets any corporate income tax that we have given it’s a higher level. So, we saw for 10% withholding tax on revenue in Nigeria and then obviously as we are growing and adding more revenue that tax is coming at source rather than further down the income statement where you get operational leverage. So, because we show our RLFCF inclusive of cash tax paid, you see that withholding tax line running through the RLFCF to give you a true cash metrics. So, as we’re growing, we suffer that tax as source, you will see the impact come through in the RLFCF.

That’s very clear. Thanks very much.

Thanks, Simon.

Our final question is from Brett Feldman from Goldman Sachs. Brett, go ahead.

Hi. Yes, thanks for taking the question and congratulations to Adam and Steve and Colby and some exciting career transitions for all of you. I wanted to follow-up a little bit around power. So, on Slide 22 you highlighted that 42% of your sites in your African markets had hybrid power solutions. And I was wondering where could that go? Could the substantial majority of your sites potentially take advantage of hybrid or maybe what percentage of your sites would you think of as being suitable and what makes them suitable? So, it’s really a question as what is your opportunity over time to maybe meaningfully augment the profile of your power costs? And I’m curious what you’re planning on doing this year in terms of capital investment around hybrid solutions? And then, you also on the same slide pointed out that it basically looks like last year about a third of your diesel costs were pass-through to your tenants under the leases. And I’m wondering has it worked out [technical difficulty] or is it just that’s the way it worked out last year?

Hey, Brett, this is Sam. Maybe I can take the first one. And then can I like to hand over to Steve on the next part. Look, people need to remember that Nigeria has a power problem. Nigeria, given its scale and size, geography and population is a massive country, but does not have electricity basically. We see ourselves as kind of like the sources of this problem. That’s why it’s like a very, very complex situation there. 5 years ago, we did a major investment in to kind of shifting away from diesel into solar, into battery and kind of like resulted in around 40%, 50% reduction in our OpEx spend. This time around seems to be like this is something that we need to do. We started late last year immediately after the IPO a drive into kind of like what can be done again. We definitely intend to go deeper into investing into renewable. We want to solve this problem more, I would say, by replicating diesel. This is now that I think to do whether on a conscience basis and of course on a numbers basis. So do expect indeed from us an announcement to that effect this year, Brett. It's definitely something we want to do. Now having said that, Brett, I also want to highlight something. The guidance has oil at $120, still our margins remain over 50%. I mean, that’s a message of resilient, that’s how resilient this business. And then having said that, we will definitely invest further and hopefully drive diesel at some point completely out of the business.

And then, Brett, on your comment around the pass-through. So, I think we are doing, as you’ve taken 5% of revenue and dividing that into our total cost of power, so I guess you do just done, it's about 29% that could be pass-through and which is correct. Just keep in mind where we do see diesel volatility is particularly in Nigeria, where we have certain elements of those pass-through revenues yet, but some of it is in LatAm, for example, which and doesn’t have any volatility in it anyway. So, yes, you’re correct, it’s about 29% gets pass-through to customers on FY '21 numbers.

And that’s essentially what you are assuming in your guidance for this year or something in that range?

Yes, correct. It carries forward because those are all long-term contracts.

Great. Thank you for taking the questions.

Thanks, Brett.

Great. Well, this concludes our call. Thank you …

That brings us to the end.

Thank you very much and we will talk to you later. Thank you.