Helios Towers plc (HTWS) Earnings Call Transcript & Summary

Good afternoon, everyone. Welcome to Helios Towers Capital Markets Day 2022. I would like to thank you all for taking the time to join us today, whether here in person or virtually. I am Chris Baker-Sams, Head of Strategic Finance and Investor Relations for Helios Towers. And before we start, a couple of housekeeping items. Our presentation today will contain forward-looking statements, which do not guarantee future events or performance. Please refer to Slide 2 of our presentation for our cautionary statements. We have presentations from our executive leadership team that will last 3 hours in total with 2 short breaks between various presenter slots. We ask that Q&A is held until the end after all presenters have presented. [Operator Instructions] Now before I hand over to our new CEO, Tom Greenwood, I'll play a short introductory video to who we are and what we do. [Presentation]

Welcome, everyone. I see some familiar faces here and some new faces, and it's really great to see all today. We thank you very much for your time. We're going to run through the presentation and then have lots of time at the end for Q&A. And for those who don't know me, my name is Tom Greenwood, and I'm the CEO of Helios Towers. And I, along with some colleagues, will be taking you through our business model, our investment proposition and why we're so excited about the growth, returns and value creation for the next 5 years and beyond. Our business is at a pivotal point in its evolution. Having recently doubled our platform in terms of size and diversification, so 5 to 10 markets, 7,000 to 14,000 towers, and we're uniquely positioned to capture the unparalleled mobile communications growth in Africa and Middle East for years to come. Over the past 18 months, we quite literally reloaded our platform, acquiring underutilized assets, which have embedded lease-up and growth, now to drive higher margin and returns, which, combined with our operating capabilities and our strong market positioning, make it a very solid outlook. And this is why we believe, and we'll take you through this today, we offer the best risk-adjusted returns for investors across the TowerCo space globally. Indeed, one of the best propositions across all sectors. But first, to properly introduce myself. I joined the business 12 years ago when it was a start-up before we owned a single tower. I've held a number of key C-suite roles through that time and being part of the team building the business from the bottom-up through what I would characterize as first 3 phases. We're now entering Phase 4. And the thing that makes me so passionate about the next 5 years is that the business is entering its strongest point yet. So we're now the most geographically diversified TowerCo in the region. We're now the most customer diversified TowerCo in the region. We're now the fastest-growing TowerCo in the region. We now have the most high-quality earnings for any TowerCo in the region. We bring world-class service to customers in very challenging environments. We have best-in-class service delivery. And our business excellence ethos, which is based on Lean Six Sigma methodology, is driving this to even higher levels. I am a Lean Six Sigma Black Belt, and you'll see a lot of these throughout our presentation today. Operational execution is a key USP for us because as a TowerCo in our regions, we're not only a real estate manager but also a power company for our mobile operator customers. And we operate to world-class quality levels in sometimes very challenging environments. And our customers trust us to deliver. So what's the purpose of Helios Towers and what's our mission? Well, our purpose is to drive the growth of communications across Africa and Middle East. And our mission is to deliver exceptional customer service through our business excellence platform and create sustainable value for our people, environment, customers, communities and investors. And our investment proposition is summarized in these 5 areas. One, we're a uniquely positioned TowerCo, focusing solely on Africa and Middle East; our regions have the highest structural growth, both organic and inorganic in the world. Three, we have a proven execution capability, our power uptime levels, business excellence, platform and highly experienced teams. Four, we have a very robust and high-quality earnings and cash flow stream. And five, of course, we combine superior financial return with sustainability impact in everything we do. So what platform will we be driving our performance. Here is our platform today, the most diversified TowerCo in the region, 10 markets, 8 of those markets were very strong -- or leading market positions. Our 14,000 sites have a tenancy ratio of 1.7 tenants per tower. And our sites typically have a capacity of 3 or 4 tenants per tower, meaning we've got a significant runway to increase tower utilization and therefore, margin and returns. Our revenues and earnings are underpinned by global mobile operators, and majority hard currency contracts and the structural growth potential in our markets is unparalleled for both organic and inorganic. There's 25,000 new points of service required over the next 5 years in our 10 markets driving the organic side, and there's 300,000 sites still owned by mobile operators, who, as we know, are continuing to divest their tower portfolios as they seek to drive capital and operational efficiency. So as we think about our platform, we're always monitoring our competition and how we stack up from the perspectives of growth, diversification, investment proposition. As you know, we're part of a global sector, and we think we offer a unique proposition in terms of our diversified platform, operational execution excellence, market position strength and growth prospects over the coming years. We're the second fastest-growing independent multinational TowerCo, globally over the past 3 years after Cellnex. And with market-leading positions in 8 of our markets and a maximum country exposure of 34% will provide the best de-risked growth opportunity in our region. So why do we offer such attractive long-term revenue quality and growth? The answer is in our core product. We own, operate passive infrastructure on the telecom side. This includes the tower itself, the power equipment, the civils, the security equipment. And our model is very simple, we start with one tenet on the site, then we aim to put as many tenants on the site as possible, which we called co-location. And then we try and get those tenants to add more equipment over time, and we charge revenue for more equipment going on our sites. It's a fairly fixed cost to run a site, so each time we add an incremental tenant, we see around 80% margin flow-through. And this is why the site ROIC jumps from 11% to 19% to 32% each time we add a new tenant. And we have a saying at Helios, we're not a TowerCo, we're a Coloco. So we only own towers so that we can add multiple tenants to them because that's what drives value. And it's not just financial return and value that we deliver. We deliver real impact in our markets, communities and environments. We facilitate digital inclusion. Today, covering 139 million people. This will grow to 0.25 billion by 2026. Because our business model is to facilitate sharing of infrastructure rather than having lots of single mobile operator towers, we inherently drive carbon emission reduction, which is further complemented by our commitment to invest $100 million in lower carbon and renewable technology by 2030, driving environmental improvements, and at the same time, financial margin improvement. And of course, a key part of our strategy is to promote and develop local talent. We're a global quality business led and operated by local people, creating sustainable business and a sustainable future. And our Board is fully focused on all elements of our sustainable impact and financial return. We have a diverse Board of 11 people, majority independent, which includes a wealth of experience across all relevant industries and areas of expertise. Alison Baker, our audit chair, is here today. So perhaps you'll meet her in the breaks. Our values and governance are, of course, core and fundamental to our business right from the top-down through the organization. Our business is founded on 3 core values: integrity in how we work; partnership with all our stakeholders; and excellence in everything we do. These values are complemented by standards and accreditations, including the 4 key ISO standards, our other procedures focused around health and safety, ethics and compliance, site structural integrity and environmental management, all of which we run to the highest global quality. And here is the team who will lead and deliver the successful execution of our 5-year sustainable business strategy. We worked together under the one team, one business ethos, and we've got a wealth of country, sector and functional experts with over 350 years of experience between us. This slide also demonstrates our commitment and focus to develop people and promote from within. Over 60% of people on here have been promoted internally, complementing that with new talent being recruited to the team. And as we mentioned before, we regionalized our group team when expanding from 5 to 10 markets, which provides capacity, Helio's culture and process embedding as well as enlarged experience for our next generation of business leaders. And in fact, a lot of the team are here today, Manjit, Phil, Sainesh, Lara, Allan and Sima, you'll be hearing from through the presentation. And I really encourage you to meet the others Fritz, Ramsey, Karim, Marinus, Beki, Doreen, Léon-Paul, Craig, Paul and Nick are all here, and hopefully you'll meet them through the Q&A and drinks at the end. So next to provide some history for our business, where we've come from and most importantly, where we're going. So our business can be characterized in 4 phases, the fourth one being what we're entering now. Phase 1 was the initial buy and build of the platform. We did the first ever tower sale and leaseback in Africa in 2002. And from there, built the initial business in 4 markets with 5,000 towers. We then entered Phase 2 in 2015, where we focused on performance centered around business excellence, driving margins and returns significantly upwards and cementing our reputation for customer service excellence and delivery. Additionally, during this time, we continued to grow our site count by 40%, which meant that we continue to grow our asset base, albeit slower than Phase 1. Following our IPO in 2019, a key part of our strategy to strengthen our platform was to geographically diversify. And we succeeded in 5 acquisition processes whilst COVID was going on, which enabled us to double our country coverage and platform size pretty much overnight. We therefore emerged from Phase 3 and enter Phase 4, the strongest we've ever been, the most diversified TowerCo in Africa and Middle East with embedded growth in our asset base prime to drive future lease-up, margins, returns and sustainable value for all stakeholders. And as you'll see in a couple of slides time, we anticipate site count growth and margin growth in Phase 4 that looks and feels pretty similar to Phase 3. So next, for our sustainable business strategy. So our 5-year sustainable business strategy as well as being founded on our purpose and mission is centered around 3 core pillars, customer service excellence, people and business excellence and sustainable value for all our stakeholders: people, environment, customers, communities and of course, investors. And this is how we characterize this as a 5-year objective, 22 by 26, 22,000 towers by 2026. So we're targeting to continue our growth with roughly a 50% site count increase over the next 5 years and at the same time, driving margin up to 55% to 60%. This is all driven by the organic and inorganic opportunity and our customer service excellence, orientated delivery, which enables us to do more business with our existing and new mobile operator customers. In terms of the split between organic and inorganic, we expect this to be roughly half and half. And importantly, this plan can be fully financed through existing cash flows and debt with no further equity raises required. Now in terms of how we expect this growth to come and our near-term versus medium-term focus, in the short term, so this year and next year, we're very focused on integrating our new markets, driving the organic growth and performance, bringing them all up to the same level on business excellence and ultimately driving lease-up margin and returns. Beyond that, in years 3 to 5, we expect further geographic diversification bit by bit in conjunction with continued organic growth in all markets, all driving our margin up to the 55% to 60% range. And beyond that, 60% to 65%, which is a natural long-term margin level of our business. Probably worth also taking a moment here to remind ourselves of our previously communicated strategic targets from the time of our IPO in 2019. So we said 8 markets, 12,000 towers in 5 years. Well, in 2.5 years, we're back here with 10 markets and 14,000 towers, which is why we're launching a new 5-year strategy today. And our customer service excellence pillar is clearly centered around our customer proposition. So what can we offer customers that no one else can. But what we offer is a combination of operational performance excellence around power uptime, rollout speeds, attractive pricing and capital efficiency, which is enabled really through our infrastructure sharing model and, of course, quality and regulatory support because we're enabling ubiquitous coverage for all faster and more efficient and with higher quality than the mobile operators doing it themselves. As you can see, some of the biggest mobile operators in the world are our main customers, and they trust us to deliver. Our focus over the coming years is to build that trust further, build that partnership further and grow our service offering and revenues with all our current customers and build relationships with new ones as well. And the key to delivering on our customer proposition is all about people and business excellence. We focus on recruiting the best people, retaining the best people, developing the best people and ultimately investing in our people. Our business excellence we're working is based off Lean Six Sigma principles. So the theory behind Lean Six Sigma, is that it teaches people to improve processes through data analytics by removing waste and improving reliability in any process. It came out of the Japanese automotive industry around manufacturing in the 1950s and has been used by many industries and companies around the world since then. The benefits of its teachings is that it teaches people to make decisions based on data rather than on hunches and emotion. It's also for everyone through the organization, not just for a senior exec. In fact, quite the opposite. The biggest value you get from it is when mid- or junior level colleagues in our markets are applying it to solve problems and drive efficiencies in the field without the need for a senior manager to be there. So whether it's a zone or head coming up with a new or better route for the maintenance team to take saving 80 kilometers driving a week, 4,000 kilometers a year, $10,000 savings a year and reducing health and safety risk or a fuel manager who identifies that a certain group of sites have abnormally high fuel consumption, works with the site engineer to deduce that by installing phase selectors on the site, we can harness the grid power better and use less diesel, thereby saving $100,000 a year and 200 tonnes of carbon. So if you have these sorts of activities happening at hundreds or even thousands of times across the business each year, it adds up to millions in savings, carbon reduction, customer service improvements and of course, health and safety improvements. We, therefore, have a big focus to take our workforce from 30% Lean Six Sigma trained to 70% Lean Six Sigma trained over the next 5 years, which will in turn drive further customer service excellence including our target to hit 30 seconds downtime by 2026. And our sustainable value creation pillar sums up what we provide, the combination financial return and sustainability impact. And in fact, our business is inherently sustainable, as we can see here. So all of the sustainable areas I mentioned earlier, digital inclusion, talent development, carbon; efficiency; in fact, they're all inextricably linked to financial return metrics, driving revenue, EBITDA, long-term earnings and margin. We're, therefore, providing all stakeholders, people, environment, customers, communities and investors with sustainable value creation for many years ahead. Now taking a step back, what attracts us to Africa and Middle East? Our markets are about amazing growth. And our focus is how in a controlled and methodical way we go about both driving and capturing this growth through prudent capital allocation in order to drive margin, returns and sustainable value. So quite simply, our regions have the best growth dynamics by far anywhere in the world, and that's structural growth for decades ahead. So whilst the rest of the world is stagnating, Africa and Middle East is tripling its population in this century and in fact, almost doubling by 2050. And along with this phenomenal dynamic, it also has the fastest-growing mobile market, the highest rate of urbanization and the fastest-growing economies. An interesting fact for you. Our countries contain 5 out of the top 10 urbanizing cities in the world. One of these, Kinshasa, the capital of DRC is today 14 million people. By 2035, it's forecast to be 27 million people. So the next global mega city. So what's this space. This city alone will need 5,000 plus points of service, telecom's point of service, in getting to that size. So really quite phenomenal growth and demand coming. As you can see here, there's a huge gap between Africa and Middle East versus the G7 countries in terms of mobile usage, which, of course, means there's a huge infrastructure gap, and we're a key part of the solution to close it. And in terms of closing that gap over the next 5 years, our 10 markets need 25,000 points of service to satisfy that growth in mobile telephony. And this equates to 25,000 potential tenants for us. And remember, today, we have 24,000 tenants. Now a mobile antenna has a capacity limit of subscribers or data they can adequately handle. So it is fairly simple to come up with a forecast of 25,000 points of service. This is independent research by the way. It's all driven by the 63 million new subscribers coming online and the tripling of data usage over the next 5 years. All of this additional throughput requires additional network locations propagating signal, and we make our revenue from the presence of that equipment on sites. And as well as simply more subscribers driving our growth as the networks evolve, up the generation curve from 2G to 3G to 4G to 5G and beyond, networks need to densify to ensure high-quality end-user experience. In other words, mobile operators need more towers and more colos within a given area. We contractually gain from this both from standard tenancy rollout, but also amendments that existing customers on that site make by adding more equipment using more space using more power; we charge for all this through our contracts. So in addition to our standard tower colo of build-to-suit product, as the networks are densifying and evolving, so is our product offering. So we're getting more innovative at providing solutions to our customers' network problems as they step up the network generation curve. So we look to provide products, which are as close to the tower product as possible, both from an operational point of view, a customer point of view and an earnings quality points of view. For example, we're providing in-building solutions, ensuring that large offices and residential blocks have good mobile service on every floor and in every room. We're also making sure that at street level, we're providing optimum connectivity through our outdoor DAS and Smart Solutions products. And we're also providing small fringe edge data centers for our customers to boost their signal to ensure that the strength of their network is maintained even away from their core network hubs. And in the future, we might provide network as a service and possibly fiber to the tower. We ensure first and foremost that we're providing our key customers with the solutions and services they need and want. We have some great examples of this, which we'll dig into later. So we've looked at organic growth. How about inorganic growth? Well, structurally, Africa and Middle East, are behind the rest of the world in terms of mobile operators divesting their towers. As you can see from the charts on the left-hand side, in our regions, 24% of towers are owned by independent TowerCos. That compares to 70% for the rest of the world. So for us, this means there are 300,000 towers, still owned by mobile operators in Africa and the Middle East, and we believe a large amount of them will be sold over the coming years. And we're in a prime position to secure the ones we like. We have strict acquisition criteria for every portfolio acquisition. We'll come to this later. We're very confident of being successful in deals for the ones we believe will add significant value for our business as we've demonstrated time after time. We've done 16 successful acquisitions over the past 12 years. And the time for towers in Africa and Middle East really is now. It looks very similar to the U.S. in 2000 when American Tower, Crown Castle, SBA, all got established. And in Europe in 2015, when Cellnex established itself. So here, I'll bring it back to the beginning, our investment proposition. Now these are the areas we'll focus on through the rest of our presentation, unique market positioning, unparalleled structural growth, proven execution capabilities, high-quality earnings and cash flows and overarching everything, our sustainable business. So in summary, we believe that this amounts to arguably the best risk-adjusted returns available to investors in the market today. And now it's my great pleasure to hand over to Manjit Dhillon, our Chief Financial Officer.

Thanks, Tom. Hello, everyone. It's great to be able to speak for you all today. I'm [indiscernible] physically after such a long time. And for those dialing in, we'll be on the road very soon and aiming to meet you all over the coming months. My name is Manjit Dhillon, and I'm the Chief Financial Officer at Helios Towers. I joined Helios Towers 6 years ago towards the beginning of Phase 2 that Tom just spoke about. And I really saw the business adopt and drive business excellence utilizing Lean Six Sigma principles. And you can see from the page, I'm an orange belt, but very much hoping to do my training this year and become a black belt towards the back part of the year. But it's been really amazing to see how this has really taken hold in the company from top to bottom. And I set the foundations for growth and allowed us to move forward with our corporate actions, for example, becoming public with our various bond issuances and our listing in the back end of 2019. I've other couple of functions in the company, leading the corporate finance and investor relations functions prior to being appointed as CFO at the back end of last -- at the beginning of last year. And alongside Tom, I've overseen raising $3 billion worth of capital across the group. So getting straight into it. We've heard from Tom about the fantastic growth opportunities in our markets and our 5-year vision. And now I'll be going through how our disciplined capital deployment -- through our disciplined capital deployment, we drive sustainable value creation in our existing markets and new markets. How our expertise and business model, which is built from the same foundations as U.S. TowerCos, will continue to drive these growth drivers to deliver sustainable value creation for all our stakeholders. I'll demonstrate our proven track record of gaining scale and diversification through acquisitions and using that as a springboard for driving lease-up and returns in all our markets and how we'll utilize that same playbook in all of our new markets. And excitingly today, through careful investments we've made, we brought the platform to deliver on our 5-year growth strategy. So just a reminder of our journey since we listed in late 2019. Our IPO, we communicated that our vision was to expand from 5 markets to 8 markets and site count from 7,000 to 12,000. And through 5 material acquisitions, we've achieved our 5-year target, creating a stronger, more diverse TowerCo in some of the fastest-growing mobile markets in Africa and the Middle East. Following the closing of Oman and Gabon, we'll be the leading independent tower company in 8 of 10 markets with 14,000 towers. And we've increased our percentage of EBITDA in hard currency to 72%. And increase our contracted revenues to $5.3 billion with an average contract life of 8 years. Whilst this has been a transformational period for the group, growing significantly by new markets acquisitions is how we've historically entered new markets, which is then used as the springboard for additional organic growth and operational improvements which drive returns. And this playbook is going to be utilized in our new markets too. We enter by acquiring portfolios of towers from mobile network operators through sale and leaseback transactions and in so doing, gain immediate scale in attractive high-growth markets. The portfolio to buy typically come with low lease rates on day 1, and the assets have been suboptimized under M&A ownership but fundamentally offer attractive opportunities for lease-up and operational improvements. To date, we've completed 16 acquisitions across 10 markets with an average day 1 tenancy ratio of 1.2. We then use that portfolio as the foundation for further growth. And one route is to be partnering with all MNOs in the market and building new build-to-suit towers. We never build speculatively, always having tenants on day 1, and we utilize our proprietary geo marketing tools to proactively identified and the market attractive locations for building sites that have a high likelihood of lease-up. And since 2010, we built over 2,900 towers. But importantly, from this base of acquired and built sites, [ with increasingly drive-up ] lease rates, we drive lease rates on our acquired sites, we drive lease-up on our built sites. Why do this? Because as Tom mentioned earlier, adding more tenants to towers is really the aim of the game, as the cost to operate tower are broadly fixed. So for each incremental tenant, you'll see that we add 80% EBITDA margin flow through from these incremental tenants. Buying and building is effectively one route to getting the base to which we will then drive these attractive lease-ups. And we've been very successful in driving lease-up on both acquired and build to-suit sites with 0.1 average lease-up on our portfolio since inception. Importantly as well, we drive operational improvements. The towers would have been run to higher levels of downtime under M&O ownership as power and tower expertise is not their core competency, but it is ours. We utilize business excellence principles to drive operational improvements, operating the sites more efficiently and effectively with higher uptime, and uptime is crucially important to our mobile network operator partners because with higher uptime, that means more time to which the network is powered and therefore, more time in which they can generate revenues. And finally, where possible, we invest in alternate power solutions to reduce the utilization of fuel, which is not only the most carbon positive action but also reduces the utilization of the most expensive form of powering a site. And today, we have 31% of our sites utilizing either solar or hybrid, something we're looking to drive over the future with our CO2 targets and ambitions of being net zero. The combination of these actions resulted in us taking what was previously an operational headache, depreciating asset from a mobile network operator and turning into the base which drives real returns. You've heard about the importance of lease-up from Tom, and you'll hear it as a theme throughout the presentation today. And the reason for this is simply shown here. On the left-hand side, you'll see the attractive returns we're able to generate from a site. And these returns remained fairly consistent since IPO. We generate 11% return on invested capital with a 1- site, which, whilst being fairly strong, is not the reason why we build sites or buy sites. We buy and build to add more tenants and that's because the incremental tenants have about 80% EBITDA margin flow-through, which should generate really attractive step-ups in return on invested capital, with 19% for a 2-tenant site and 32% for our 3-tenant sites. Now these tenants are not on the tower for 1 month or 1 year. They sign up to long-term contracts, and I'll speak about the contractual makeup shortly, but these are long-term compounding cash flows. And on the right-hand side, we show illustrative cumulative tower cash flows. Towers last for 40 years plus. And the quicker we're able to lease them up, the quicker the payback. And here, we call out that on a 2-tenant site, there is a 5-year payback, which means 35 years of incremental cash generation. So building sites for mobile network operators in attractive locations and actively marketing those and leasing them up is one of the main ways in which we can drive cash flows and returns. This year, we've guided to a strong rollout of new sites, and this is great because we'll continue to build from the base to which we can then drive these attractive levels of lease-up that you see here and returns you see here. Now when we look at new acquisitions and new markets, we conduct extensive due diligence on the site portfolio and ensure there are compelling dynamics for lease-up. One key element of the analysis of sites locations is utilizing our proprietary geo marketing tools to plot the site locations against demographic information and network design principles to get confidence that the sites are in attractive locations with good lease-up potential. And Sainesh will talk through this analysis during his presentation. But we also take a very disciplined approach, an analytical approach to broader new market characteristics. And here, we set up some of the characteristics we look for. And whilst we've been successful with a number of acquisitions that we've spoken about, we've also walked away from a number of potential transactions team, which did not align to these criteria. So going through these characteristics of what we look for, we look for opportunities in emerging markets and specifically Africa and Middle East, all of our markets align to that. Where possible, we look for markets who have populations over 10 million people with multiple mobile network operators. And in 7 of the 10 markets we operate in, we have 3-plus mobile network operators, and that's expected to increase to 8 with a potential new entrant in Malawi. We look for the possibility of being the #1 or #2 TowerCo, and we are the leading TowerCo in 8 to 10 markets. We look for stable and/or pegged currencies and a number of our markets are pegged to the U.S. dollar and euro, and we have 72% of our EBITDA in hard currency, and that reflects some of the innate hard currency makeup of 5 of our markets combined with some contract structuring in other markets. And of course, we look for markets where there is a power and tower infrastructure gap, high subscriber growth and low mobile penetration, which all of our markets have. And as mentioned by Tom earlier, the structural growth drivers in our markets are incredibly compelling with independent forecasts showing an organic requirement for 25,000 more points of service and a point of service is effectively an incremental tenancy across our markets. Given that we have market positions -- market-leading positions in the majority of these markets and growing market shares in the rest, we are really strategically positioned to get a good chunk of that organic growth. And ultimately, the combination of the above will drive the bottom requirement, i.e., investment will enhance group returns over the medium term, which all of our markets do. Now the portfolios we've recently purchased presented a very similar characteristics and opportunities for lease-up as our established markets. And actually, the day 1 blended colo ratio of our established markets is the same as our blended colo ratio of our new markets at 1.2. We were able to drive that up to 2.1 in our established markets. Average lease-up has been about 0.1x, and we're guiding to a broadly similar level in our new markets of 0.05 to 0.1. Now lease-up is not linear. We won't see 0.1 every year, and they will come in fits and bursts, i.e., some years where we may see more build-to-suits, some where we may see more colos, which is normal for tower infrastructure. And in our established markets, we've had a range in some years; some year being 0 and some years being 0.2. But ultimately, looking at this over the medium term and smoothing out some of those lumps and bumps, we expect to see an average of between 0.05 to 0.1. An important part of the playbook, though, is using the acquisition as a platform for building sites, and we see attractive lease-up on our organic build-to-suits too. Here, we set out our track record of driving lease-up on both acquired and organic towers and reap the benefits of picking strategically attractive markets and combining it with our proactive sales approach. On the left-hand side, you'll see the acquired sites. On the right-hand side, you'll see our organic portfolios. And for both, you can see that with the earlier vintages, i.e., 2010 to 2015, both have been leased up to above 2x. Now the acquired portfolio has come in some lower levels of co-location on day 1. But if you look at the numbers in the ovals above the bars, these show the average annual tenancy lease-up. Build-to-suit is slightly ahead of the acquired portfolios, which is due to the fact that we use the GIS analysis that Sainesh will go through to help us guide the location of new sites, leading to slightly faster lease-ups than some of our acquired sites. However, both are in a very strong range of 0.1 to 0.2, and this demonstrates that whether we are building or buying, we have proven experience of successfully identifying good assets and good locations and then driving lease-up. And it's this proven track record, which we will take into our new markets we've recently entered. And so bringing all of this together, we show a case study of Tanzania, which really shows our model in action. Philippe will be going through this later in the presentation as he lived and breathed this on the ground as Tanzania MD for a number of years. And Ramsey is also here today. He also drove the growth during his time as MD in Tanzania too. But fundamentally, Tanzania is an example of what we do, enter by acquisition, use that portfolio as a springboard for growth, driving lease-up, organic growth and operational improvements. We entered in 2011 where we purchased Tigo's portfolio and supplemented that through the subsequent acquisition of Vodacom's portfolio in 2014. Subsequently the constructed 60 -- sorry, 1,600 built-to-suits in the market and drove our colocation ratio from 1 in 2011 to 2.3 today. And with that, comes EBITDA and return on invested capital growth. And in 2015, we saw adjusted EBITDA step up substantially from $29 million to $113 million today. And return on invested capital increasing by 13 percentage points. What's really exciting here though is that this is just the beginning. Mobile subscriber penetration is still at 42% and it is forecast that there will be 8% point of service growth over the next 5 years. And we are strategically positioned as the #1 TowerCo to get a good chunk of that growth going forward. Now Sainesh will present another case study, which shows exactly the same playbook being utilized in DRC, entry by acquisition lease-up, operational improvement, driving returns. This is what we do, and we'll utilize the same playbook again in all of our attractive new markets over the coming years. So looking at where we are today and what we've seen over the past few years. From 2016 to 2020, we've grown sites, tenancies, tenancy ratio, EBITDA margin through the actions I've just spoken through over the last few pages. Now as we stand here today, sites and tenancies have seen a step-change given the new acquisitions. As mentioned earlier, given we purchased portfolios of towers with low day 1 tenancy ratios; they will dilute a few metrics in the short term, including tenancy ratio and EBITDA margin. However, we have bought a broader, stronger, more diverse portfolio in high-growth markets, but we are strategically positioned as leader in 8 to 10. The platform really is primed for lease-up. And especially when you bear in mind the expected market growth of 25,000 points of service over the next 5 years. And we'll take our proactive sales approach and expertise in lease up and operational improvements to drive returns from this bigger base over the next few years to hit our 5-year targets that we set out earlier. Now I'm going to shift gears slightly and I'll focus on how our business is sustainably set up to capture the compelling growth drivers we've been talking through. So our model is underpinned by long-term contracts with a diverse set of blue-chip mobile network operators across multiple markets with strong hard currency earnings. We have strong U.S. TowerCo style long-term contracts with our customers, and today, [ pro forma ] for acquisitions, we have contracted revenues of $5.3 billion with an average remained life of 8.3 years. This means excluding any new wins and rollout, we already have that revenue contracted, and that provides a strong underlying earnings stream for the business to which will then layer on top organic growth and potential inorganic growth. Importantly, given the mix of our established markets and new markets, we have 72% of our EBITDA in hard currency being in the U.S. dollar or euro paid, which provides a fantastic natural FX hedge for the business and which is further complemented by our annual inflation escalators, which we have in our contracts with our customers, which I'll come on to you very shortly. 99% of our revenue come from large blue-chip mobile network operators with a diversified mix with maximum single customer exposure at 28%. And finally, with the new market expansion, we are the most diversified tower company operating in Africa and the Middle East being in 10 markets with no single market accounting for more than 31% of revenues. Now our contract structure is very similar to U.S. TowerCos. And we refer to U.S. TowerCo because they are some of the strongest contracts in the world, and we utilize exactly the same structure in our high-growth markets. i.e., they are long term, 10 to 15 years minimum initial term with expected duration of 40 years plus with automatic renewal clauses and minimal cancellation rates. MNOs are only able to cancel a small amount of tenancies per annum at roughly 1%. And if they want to cancel the contract, they have to pay the term, which is a high capital outlay for the MNO. The contracts have menu pricing for amendment revenues mean that if MNOs want to add more equipment to the tower and utilize more power outside of their allotted amounts, they have to pay for that. And this is incredibly important as you move up the generations where we see mobile network operators put their 3G equipment next to their 2G equipment and their 4G equipment next to 3G, and all of this is captured in our contracts. We also have inflation and power price escalators, which I'll come on to shortly. But ultimately, our contractual structure provides revenue visibility with a strong set of customers, and as mentioned earlier, with $5.3 billion worth of contracted revenues today. Now as a business, we operate in some markets where there are innate hard currency, where they are innately hard currency. And here we show those markets on the left-hand columns. DRC is a dollarized economy, Oman is dollar pegged, Senegal, Congo B and Gabon are all euro pegged, with the peg guaranteed by the French Central Bank. All of these markets provide 100% EBITDA in hard currency. In our other markets, where there's a more prevalent local currency, we either receive a small portion of revenues in U.S. dollars or have contract structuring such we're able to align a portion of our revenues to have U.S. dollar resets. When you bring all of that together, 72% of our EBITDA is therefore in hard currency, which is a fantastic position to be in and provides a resilient and robust earnings stream. Additionally, in all of our contracts across all of our markets, we have inflation and power price escalators. And the combination of these 3 components provide substantial protection against macro movements. Now here we set out some details behind our inflation and power price escalators. For inflation, these are annual escalators, which typically escalate between December and February, with the escalation linked to the revenue we receive, i.e., if we receive U.S. dollars, it's U.S. CPI, if it's local currency, it is local currency CPI. And this helps to supplement the FX protection that we have. For our power price escalators, these are roughly split 50-50 escalating annually and escalating quarterly. For power price escalators, the adjustment in the contract go both up or down depending on the local prices, power prices. So in the circumstance there's falling prices, the escalated reduces; by the power prices increase, the escalator increases. The fuel escalator is linked to the local fuel prices. So whilst you may see Brent crude volatility, which you see here in the dotted line, it does take time for that -- for what on screen to impact our local prices in our markets. And we've shown the analysis here at the bottom of the page, which we've shown previously as well. And typically, we see a lag anywhere between 3 months to even a year to really have an impact locally. And typically, the movements in the markets are more muted without saying any peaks and troughs, particularly in comparison to Brent crude, and it's the local markets, which we experienced with regards to reference pricing for our contracts and for the procurement of fuel. So how do these escalators actually work in practice? There's a fair bit going on in this page, I'm going to take the time to kind of go through it. But we set out an illustrative case study of how our contracts provide protection in a situation where there's been an increase in both fuel prices and some currency devaluation. So on the top of the slide, we showed 28% of our EBITDA that's in local currency, and I'll go through that portion first. On day 1, you'll see our site-adjusted EBITDA is 100. On day 2, in this circumstance, we show that there's been a local currency FX devaluation of 10%. And as a consequence, the 100 goes down to 90. On day 30, we also see fuel prices increase by 10%, which increases the cost of fuel and, therefore, reduce our EBITDA further to 86.4. However, on day 90, our quarterly fuel escalator kicks in and our revenue increases. And as a consequence, our EBITDA goes up to 91.8. And finally, on day 365, our annual CPI escalator kicks in of 12%, which is assumed in this example, at 2% U.S. CPI and 10% local currency, which broadly matches the FX depreciation and which resulted in EBITDA getting back to 99.4. So in a year where there's been FX depreciation of 10%, fuel price increases of 10%, we're still able to get our site adjusted EBITDA, broadly back to where we started. Now on the bottom part of the graph, we show our 72% in U.S. dollar EBITDA, and the impact of that under exact same scenarios. So we go to day 2, where there's been no local FX depreciation, no impact on our U.S. dollar EBITDA. Local currency fuel increases by 10%, doesn't impact our U.S. dollar EBITDA. And we have no movement all the way up until day 365, where the U.S. CPI escalator kicks in at 2%, which results in an end point of 101.4. Now this case study really shows how our contracts work and the proof is there, where we show our quarter U.S. dollar EBITDA plotted against both FX rates and fuel price movements. And you'll see that despite FX and fuel price movements being more volatile, and you see that with the dotted lines, our U.S. dollar growth more closely ties to our growth in our tenancies rather than to any peaks and troughs raise to fuel or FX. So much so that when you look at the R-Squared of EBITDA versus tenancy growth, with R-Squared being a measure of correlation with one being very highly correlated, we get to 0.93. But also, the FX and oil price movements have a negligible correlation. And this demonstrates that the natural hedge complemented by our contractual escalators are effective in providing protection against macro volatility. When you combine this with our long-term contracts with blue-chip customers, we really do have a very robust business model to capture the exciting growth ahead in our existing and new markets. Ultimately, this gives us a lot of confidence in security, because if we succeed in rolling out more tenancies, we succeed in growing EBITDA and therefore, succeed in growing returns and tenancy growth is what we do. Now I'll touch on a number of points around our expertise and experience in entering new markets by acquisition, driving growth and returns. And after the break, my colleagues will be able to further demonstrate this with live examples. But what I find really exciting here is that there is a really compelling growth opportunity, especially when you combine this business model, the track record, which, our proven track record with a broader, more diversified base in high-growth markets, all of which is primed for lease-up that will help us reach our 5-year strategy and continue this trend of EBITDA growth. So with that, we're going to stop/pause for a short 10-minute break, where Lara and Allan will take us through our operational execution capabilities. Thank you. [Break]

All right. Thank you for coming back, everyone. We appreciate it. My name is Allan Fairbairn, and I'm the Director of Delivery and Business Excellence. This is my colleague Lara Coady, who's Director of Operations and Engineering, and we're going to take you through a presentation on our proven execution capabilities, delivering best-in-class service in our markets. But by way of introduction, I joined Helios last year. And prior to that, I spent 15 years at Aggreko, where I spent all of my career working in Africa and the Middle East. I left Scotland in 2006, having traveled to only a handful of countries. And during that time, I traveled to over 90 countries, mainly across Africa and the Middle East, as I said, but I worked in Madagascar, South Africa and Senegal in most of the markets that Helios are already in today or moving into in the future. A specific example I want to call out is where I was, prior to joining Helios, I was MD for Western Central Africa. And I ran a business in Nigeria, where we had 50 distributed power plants across the country, providing critical power infrastructure and manufacturing, mining and oil and gas. I'm also a fellow of the Institute of Engineering and Technology, and I spent time volunteering helping young engineers across Africa and the Middle East to become chartered engineers. And in my first 9 months with Helios, it's been a fantastic journey and the depths of talent and potential in this organization is absolutely fantastic. Over to Lara.

Thank you, Allan. Good afternoon, everybody. I'm Lara Coady, Director of Operations and Engineering. I've been with Helios for 6 years. And prior to that, I worked alongside Allan at Aggreko. I've been working in Africa and the Middle East for over 13 years in various operational and technical roles. My first role joining Helios, I established the project management office at group, so developing the skills and processes to be able to deliver critical growth for our customers. Returning from a maternity leave in 2019, I was promoted to Head of Performance Engineering. Now this was a new function. So I spent most of my time developing the teams within the regions to focus on improving the performance across our sites. And I've been a key player in driving power uptime improvements over the years, which I'll talk to you in a little bit more detail. I became a Black Belt in 2013 from Ohio State University, and this has enabled me to support and champion the business excellence culture that we have today across Helios. So I'll hand over to Allan, who will take you through the first part of our presentation.

Thank you, Lara. So these are the 4 key operational highlights that we would like you to take away today. The first being that we bring, we bring global operating standards to highly complex markets, and we do this by training our people and developing them. The second key takeaway is that we create value through enhancing revenue opportunities and reducing our cost base. The third key point, we have a consistent and strong tenancy growth being delivered since 2019, and we're going to continue to do this in 2022 and beyond. And the final takeaway is that we have a very clear plan in place to reduce our carbon intensity and achieve our net zero ambition by 2040. Operating towers in Africa and the Middle East requires a unique skill set, and this skill set is not easy to replicate. In developed markets, towers are traditionally connected to the national utility grids and the lowest cost of capital wins. But in Africa and the Middle East, there are significant challenges. We have vast geographies to cover, we have significant infrastructure challenges and power challenges, which I'll talk more about. And a specific example of this is recently, we're working on a project in Madagascar, where there are some really complex phases of the country. And we've actually split the country into 3 levels of complexity due to the really complex topography. It's got very high wind speeds, and a number of the sites are very difficult to access. So Helios Towers really brings organization to very complex markets. And to expand on this a bit further, the land mass of our markets compared to the EU is 60% larger, but we have a fraction of Tarmac roads. So connectivity between the sites is often challenging. And the key point is that the grid availability in our markets is on average 18 hours per day versus 24 hours a day in the year, and on the next slide, I'll do a deeper dive into the grid availability. So it's a fact that many people in our markets are used to having, more used to having a mobile phone signal than power in their own homes. So for example, in DRC, the grid is only available on average 6 hours per day. and Madagascar 9 hours per day and some other examples, Senegal, 23 and Ghana 22 hours per day. But our customers demand that we have 24/7 power availability on our sites to allow them to connect to their subscribers. And how do we create such value? We create this value by training and developing our people over and over again. And we use Lean Six Sigma as a vehicle for turning our strategy into a real action on the ground. And Lean Six Sigma is the way that we achieve this. Lean Six Sigma teaches us to have a laser focus on customer requirements, both for today and in the future. It also helps us to align with our colleagues across the group by speaking a common language and focusing on the real high-value initiatives. But what have we delivered with Lean Six Sigma? We've delivered in excess of 1,000 tenancies per year since 2019, and we announced this morning a fantastic start to Q1 '22, and we're going to -- that will continue in the years to come. We've also reduced our power downtime by -- improved our power uptime by 95%. And Lean Six Sigma has also contributed to the improvement in EBITDA margin expansion over the periods. But this is the foundation for our next 5-year strategy, and we're going to continue to train the people, targeting 70% by the year 2026. On the next slide, I'll talk a bit more about our customer focus. So we spend a lot of time visiting our customers in the markets that we operate and also at group level, and there are very common themes of what our customers want. They want world-class levels of power uptime even in markets where the national grid is not often available. They want fast and efficient rollout deployment of build-to-suit and co-locations. And increasingly, they want us to ensure that we have a robust sustainability program and are evaluating new technologies for the future. And this creates values for all stakeholders. And on the next slide, I'll talk more about our rollout plans. So this graph represents our sales and operation planning model, and we've used this in Helios since 2015, and it starts on the left-hand side by really focusing on what the customer wants. So the operational teams and the sales teams connect with the customer and establish what rollout plans they're looking to make in the coming years or that particular year, and we ensure that we have the right people and the right infrastructure on the ground at the right time to exceed their expectations. And we've proven this through COVID where our supply chain processes have enabled us to continue to deliver for our customers. In the center phase of the life cycle in the construction phase, we aim to shorten the construction time as much as possible but also optimize our cost base from our constructing towers and delivering co-locations. We then hand these assets over to operations to operate these assets for 10 to 15 years. So I've explained that we have the capability, but what does this all mean? It means that we are primed for growth. In our established markets and our new markets, we have tenancy ratios that have a significant opportunity to expand and deliver more co-locations for our customers. And I'll now hand over to Lara, who's going to discuss power availability and our sustainability strategy.

Thank you, Allan. So Allan has outlined the structures that we have in place to be able to support the customers growth but it's equally important that we're able to provide an excellent operational experience. Now why is this so important? If we consider annually for every 1% of downtime for the MNOs, this is the equivalent of $175 million of lost revenue. Additionally, 92% of their subscribers are pay-as-you-go. So like you and I, if they experience poor network coverage, it's very easy for them to move to a different mobile operator -- provider. Over the last 7 years, we've seen a 95% improvement in this performance. Back in 2015, we're at 22 minutes downtime per tower per week. And last year, we were at 1 minute and 10 seconds. But we're not stopping there. As Tom mentioned earlier, we've set ourselves a target of 2026, achieving 30 seconds downtime per tower, more than 50% reduction on where we're at today. Now coming back to the Lean Six Sigma principles, we have a second measure. We also measure the number of sites that achieve Lean Six Sigma. Lean Six Sigma is the equivalent of 3.4 defects per 1 million events, and that equates to only 2 seconds downtime per tower. And we can see that as last year, 93% of our towers actually achieved that Lean Six Sigma performance. So how have we achieved this? So leveraging on the wealth of knowledge and experience that we have in applying those Lean Six Sigma principles, we've broken the operational method into 3 key areas. It's about having a robust maintenance plan to actually prevent outages from occurring in the first place, making sure that the technicians are well trained, have the right tools to carry out this work. We've actually digitalized this process, giving all of our technicians handheld devices to be able to capture the information through photographs while they're on site. The second area is a dedicated focus on those sites with a high defect rate, which in this instance is outages. Every month, we analyze to understand which sites have the largest outage. We assess what corrective action is required. We complete the work and then we reanalyze the site to ensure that an improvement has been seen. Now to put this into some context, when we launched this initiative back in 2015 in Tanzania, only 18% of the towers contributed to 95% of the downtime. So you can quite quickly see that by focusing on a few issues has a significant improvement in the overall performance. And the third area is around incident management. It's about making sure we can respond to any issues quickly. And we've worked with our maintenance partner under the ethos of One Team, One Business to make sure we can do this. We have great visibility on our sites, and we have a network operating center that can respond to the alarms, mobilizing technicians that have been positioned in the prime locations to be able to get to site to fix the issue before we actually have an outage in the first place. Now one of the reasons mobile operators sell their towers to us outside of the financial benefit is that they're actually outsourcing a significant operational challenge. What we can see here with the 2 examples is that we consistently drive power uptime to better levels than before. The first example on the left, we've got the acquisition in Congo B from Airtel back in 2015. We've seen a 95% improvement over the last 6 years. And then more recently, an acquisition in Senegal with Free. Between May last year and March this year, we've seen a 98% improvement with the performance in March this year, reaching only 6 seconds of downtime per tower per week on average. This is proving that the blueprint that we apply across our new markets works. From day 1, we implement our processes. As well as the benefits for the customer, there's also benefits for Helios. Fewer callouts means that we can dedicate that time to optimizing the performance of the sites, less reacting, more about optimizing, which brings me nicely on to the next slide. At the end of last year, we communicated a 46% reduction on carbon emissions per tenant by 2030. And as I mentioned in the introduction, we've established the performance engineering team, which has been a great foundation to achieve this. And we've been making great progress. As of last year, we've already achieved a 7% reduction on that target. And this is driven in 3 key areas: the first, colocation growth. Fundamentally, as we add more tenants to the tower, those tenants will share the same power from the same generator, making it much more efficient; the second area, carbon reduction program, this is continuing the work that the performance engineering teams do today; and the third area is around innovation, and I'm going to talk you through a little bit more on that now. As Tom mentioned earlier, at the end of last year, we committed $100 million across Project 100 focused on reducing our carbon. This is broken into 2 sections: the first, the reduction program is that continuation of the work we've been doing over the last few years. Analyzing the sites to understand where the best opportunity is for us to install solar connect to the expanding national grid. Additionally, we've been focusing on battery technology. And recently, we made the decision to move away from lead acid batteries and across to lithium-ion batteries. And this is because we can operate them at higher temperatures that we see across the Africa regions. They have a longer life. So we're actually using battery technology to reduce the amount of time the generators are running. And then looking ahead at the innovation, while it state here '27 to '30, this is something that we're working on today. We're looking at new technologies that we haven't today installed that we think would be viable in our markets. And to give you a couple of examples, we're currently looking at wind technology, and we've run a number of business cases across South Africa, Senegal and Tanzania and we've seen a great opportunity across approximately 300 sites in Tanzania, where the wind speed is above 5 meters per second, and we'll be running a pilot in Q3 this year. A second example I'd like to highlight is mini-grid installations in DRC. We're working with a number of partners to install independent grid installations that we can connect to as the primary customer, but will additionally provide power to those local communities that are without today. So I've spoken about the 46% reduction for tenancy, but we've also set an ambition to be net zero by 2040. However, we recognize we're not going to be able to achieve this alone. We've seen a step change in the collaboration with our customers as we recognize we have the same value chain, and we've been working together closely, particularly with one customer to evaluate what technology they have seen has worked and what technology we have seen has worked. And it's been very interesting to see that we're actually looking at the same solutions. There are 3 key areas that we've identified that will enable us in achieving this. The first is about local expansion of national grids to greener and cleaner power provisions. And if we look at some examples here, DRC, where we have relatively low grid availability, only 6 hours a day is actually very green. It's the greenest power provision we have across our markets as it mainly comes from hydro. In comparison to South Africa, where the grid availability is much better comes from predominantly coal. But if we think about carbon financing in November last year at COP26, there was an $8.5 billion financing deal agreed between the EU, the U.S. and South Africa to move away from coal over the next 15 years to use more sustainable solutions. And the third item is around innovation and technology itself. Again, just to give another example to bring this to light. Since we began installing solar back in 2016, we've seen a 36% increase in the power density, meaning we can actually get 36% more power out of the same sized solar panel. This means we can reduce the footprint of solar installations, meaning it becomes a more likely option for more sites in our portfolio. So to summarize, Allan and I have demonstrated that we've got proven capabilities in complex Africa and Middle East markets. We had one of the highest tenancy rollouts in 2021, and we're targeting higher levels in 2022 and beyond. We've seen the region's best power uptime performance, and I think Senegal is a great example to show how our blueprint works. We have a clear plan in place to achieve our carbon intensity targets and the 7% reduction shows we're making good progress on that. So thank you for your time, and I will now welcome my colleague, Sainesh.

Thanks, Lara. Good afternoon all. It's great to be speaking to you today about how we drive customer partnerships, which in turn drives real impact in our markets and real return for our stakeholders. Before we go into some of the details, let me properly introduce myself. I'm Sainesh Vallabh, Regional Chief Executive for Southern and Central Africa. I cover 5 markets within the group, being DRC, Congo Brazzaville, Ghana, Madagascar and South Africa. In addition, I have functional responsibility over sales and new product development across the group. I joined Helios a little under 2 years ago and what a fantastic journey it has been so far, working with talented and dedicated people in a business that has a well-defined strategy as well as robust processes and a culture that promotes success and excellence in everything that we do. Prior to joining Helios, I was the managing executive at Vodacom Group, where I was responsible for merging acquisitions and strategy across the continent. Overall, my career spans 18 years with experience in 17 countries across Africa. I am passionate about telecoms in Africa and driven by the impact that digital communications has as a key enabler for driving and bridging the economic divide that exists on the continent. Let us take a snapshot view of the region. Our OpCos are led by an experienced and localized team who collectively have about 100 years of experience in Africa. Joining us today is Fritz Dzeklo, who is our Managing Director in Ghana, but also the Regional Director supporting the operations in Congo Brazzaville and DRC. As well as Marinus Gieselbach, who is our Managing Director in South Africa, but also the Regional Director for Southern Africa, supporting the operations in Madagascar. You will have the opportunity to engage with both of them during the breaks as well as the drink session after the presentation. The region has attractive macro and sector indicators that promote our business model. There are over 240 million people in the region and more than 2/3 are under the age of 30. Population is also expected to grow by 4% per annum over the next 5 years. In addition to that, more than half the population remains unconnected to mobile network, unique subscriber penetration stood at just 46% at the end of 2021, a young, growing and largely underserved population underpins the growth in connectivity into the future. Furthermore, there is an average of 3 to 4 mobile operators in each of our markets in the region. And with a tenancy ratio of just about 2x, this signals a compelling opportunity for driving colocations, which as you've heard today, is a key driver of returns in our business. Looking at the region's asset characteristics, there are about 4,500 sites across the 5 markets, representing about 1/3 of the group's assets. This, in turn, generates $290 million of revenue and about $155 million of EBITDA, almost a 45% contribution to the group. The largest and most profitable market is DRC with over 2,100 sites, representing about 50% of that of the region, generating over $190 million of revenue and about $110 million of EBITDA, which is just under 30% of the group. You will hear more of the success story in DRC later in my presentation. But first, let's take a look at how we are driving customer partnerships across the group through our strategic sales approach and new product development. We have a proactive partnership approach with our customers. This allows us to be deeply embedded in the network and radio planning thought processes of our customers as well as understanding their future requirements so that we are able to tailor solutions and delivery. Two key elements define our partnership approach with customers, our sales approach and the usage of our proprietary GIS analysis, which is our geo marketing tool. In terms of our sales approach, our teams are structurally aligned to that of our customers. Local commercial engagements are complemented by group functioning engagements to ensure we remain on top of requirements, expectations and seamless delivery. This partnership engagement is fully supported by all functions, including operations, supply chain and finance to ensure best-in-class service delivery. In addition, we have a standardized and structured sales process. Miller Heiman methodology is deeply embedded within our OpCos, which gives us a better -- an ability to better understand customer requirements and decision-making process. It also ensures that all relevant customer engagements are recorded and transparent while also ensuring that all our teams speak the same language when engaging. This methodical approach works well with our business excellence ethos and Lean Six Sigma principles and is highly effective when dealing with large complex customers such as ours. Currently, 60% of our sales staff are trained in Miller Heiman, and we are targeting 100% to be trained up by 2026. We will also be embedding this strategic sales process in all of the newly acquired markets to manage and develop the new relationship in these markets. Our proprietary GIS analysis fully complements our strategic sales approach. GIS is a platform that leverages network infrastructure and demographic information to assess the uniqueness of sites and determine the best network fit that will be most impactful for our customers' network quality. The benefits of GIS are not only in colo sales or identifying optimum locations for new builds. It also -- we also use it for assessing attractiveness of portfolio acquisitions and entry into new markets. We are currently observing an 80% predictive accuracy, which is a huge value add to us and to our customers as it proactively assists our customers in their radio and network planning while also maximizing the usage of our sites. You will later see in my presentation, an example of this in the DRC. Our site portfolio is attractive to our customers. About 72% of our sites are unique. This means that there are no other sites closed by, and it is ready for new operators to lease up. The remaining 28% is ideal for capacity loading for -- as technology evolves and consolidation where an operator may look to terminate its site and go locate on our own. In addition, over 60% of our sites are in urban areas. This is where we tend to see colocations first as these are typically the areas where operators deploy new technologies first. But of course, over time, new technologies will also be deployed in rural areas, driven by coverage obligations and our customers' growing demand in connectivity. Furthermore, about 85% of the portfolio still has either 1 or 2 tenants on them. This means we are well positioned and ready for lease-up on our sites as on average, we can accommodate between 2 -- between 3 or 4 tenancies. Technology evolution also plays a hand in driving the growth of infrastructure. And Africa and the Middle East are the early stages of 4G deployment. Today, just over 20% of the subscriber base utilized 4G. In fact, it was only in 2019 where 3G and 4G utilization was greater than 2G, meaning that data usage is still in its initial growth phase. As 4G and data usage evolves, so will the need for network infrastructure for densification and coverage to cater for the additional traffic, which basically means more points of service. Technology evolution is also a driver of amendment colocation revenue. This is where operators need more space and more power on an existing site to accommodate new radio systems. We generate about 5% of our revenue from amendment colocations, and we expect this to remain broadly in this ballpark as the business grows. New technologies also support our new product development strategy, which further drives partnerships with our customers. Tom mentioned a few key points earlier. To add to this, our selective approach on new products ensure it remains complementary to our core tower business, while also maximizing customer and operational synergies. We are currently getting good revenue from -- and earnings from our in-building solution, our outdoor DAS and smart solution as well as fringe edge data centers. We may also, in the future, look to provide network-as-a-service, which is basically a full turnkey solution, predominantly focused for rural coverage as well as fibre to the site, which will allow mobile operators to backhaul more effectively, further supporting 4G and eventual 5G rollout. Let's take a look at the case study in Tanzania of how new products improve customer partnerships and drive returns. Working collaboratively with 2 of our key customers and the regulator in Tanzania, we developed a solution to enhance network coverage and quality in a dense marketplace in Dar es Salaam, the capital of Tanzania. The lack of coverage in this area was a key pain point for our customers. It was not possible to deploy a macro site given the limited space. As such, we work jointly with our customers and developed 2 lampposts solutions. These lampposts are connected via fibre to an existing Helios site, which basically allows operators to amplify coverage in the area. We have 2 tenants on day 1, which basically means our customers' customer remains connected, a key government objective of improving coverage. For us, this means greater than 20% return on capital, which is in line with that of a macro site, but delivered faster. Okay. Now let's look at how we are driving real impact and returns by using DRC as a case study. Our story in the DRC highlights our ability to lease up assets, driving growth and returns while delivering real impact in complex environments, a blueprint that we apply to all of our other markets. We have invested over $500 million in the DRC since 2011. The graph on the bottom left showcases the successful execution of our business model, which you've heard about, where we acquire underutilized portfolio from operators and through our business excellence approach, drive lease-up while also building new sites to increase customer relevance and drive returns. In 2011, we acquired about 520 sites from Tigo with a tenancy ratio of just 1.1x. And in 2016, a further 1,000 sites were acquired from Airtel with similar dynamics. We have successfully driven lease-up in addition to new build. And today, we have about 2,100 sites with a tenancy ratio of 2.3x. This is the blueprint we use across our markets, and you will hear later about another good example when my colleague, Phil will speak about Tanzania. With the capital invested, we are now generating over $100 million of EBITDA and about 16% return, which has more than doubled over the past 6 years. However, despite the growth in mobile telephony in recent years, DRC still remains relatively underpenetrated market. There are 37 million people connected to a mobile network. However, this means that a whopping 60% are not and remain unconnected. Furthermore, 47 million people are in a location that does not have mobile coverage at all. This underpins the huge potential for Helios. A driver for this growth is the evolution of technology. Currently, more than 95% of the subscribers use mobile for 2G voice or 3G basic data services. As 4G evolves, so will the need for additional points of service. For us, this means more sites and more colocations. We expect point of service in the country to grow by over 5,000 to reach 13,000 by 2026 in order to address the growing demand of connectivity. Notwithstanding the great opportunity presented, DRC is a complex market with inherent challenges. Firstly, transportation. DRC is a vast country. Its land mass is about 9 times the size of the U.K. However, only 1% of its roads are tarmac compared to the U.K. This means that alternative modes of transport to build and operate sites are almost always required. This includes air freight, use of rivers and other waterways and sometimes transportation on foot as well. We have a dedicated operations team supported by a vast network of partners, including supply chain to navigate this complexity. Secondly, power. DRC is one of the world's most underpowered countries. Only 19% of its people are connected to the grid. This is compared to almost 50% in Sub-Saharan Africa. But despite this power challenge, we deliver exceptional power uptime to our customers. 100% of our sites are connected to a diesel generator providing about 14 hours of uptime per day. Through our sustainability objectives and our investment in Project 100, which you have heard about, we have reduced this by 1 hour from 15 hours the year prior, and we will continue to reduce this into the future. 19% of our sites in DRC used solar and 50% use batteries, which together generate about 4 hours of uptime per day. The remaining 6 hours [ I think with ] the grid. This combined power solution, together with our business excellence approach and our customer service excellence centricity has resulted in substantial improvements in our downtime, not only just over 3 minutes per hour per week. From my time at Vodacom, I can tell you that this is a key measure of impact for mobile operators as it not only sustains connectivity for customers, for their customers, but also drives revenue for them. This means they like us a lot. Despite the transportation challenges, we continue to roll out and maintain our sites. As an example of this, in 2018, we invested in the build of a substantial microwave backbone across challenging jungle terrain covering 1,800 kilometers. To put that into perspective, that is equivalent to the distance between London and Rome. In addition, some of the sites are an altitude of over 1,000 meters. You can imagine the complexities that, that creates for maintaining our sites. This investment, however, has resulted in the connection of 6 million people that were previously largely unconnected. It also promotes our customers' rollout of 4G services in the area. That's a real impact right there. We continue to invest in the DRC. And between 2021 and 2022, we expect to connect a further 1 million unconnected people through our delivered build as well as our strong committed pipeline. I mentioned our proprietary GIS analysis and how we use this to drive customer partnerships and impact. To highlight this, the map here gives a view of how it works. This is the map of Kinshasa, the capital city of DRC. The lines highlight existing mobile coverage cells and potential gaps in the network as predicted by GIS. Using this tool, over 80% of the rollout in 2021 was predicted. The red dots highlight new, where new points of service were taken up, and it basically shows that we have proactively marketed the build of 80% of all new points of services to our customers, a huge value add not only to our customers but also to the growth of mobile telephony in general. Overall, our impact in DRC can be demonstrated in these 2 charts. To put the scale into perspective, the distance from Kinshasa on the east to Goma on the west is equivalent to the distance from London to Athens. In 2015 with about 1,600 tenancies, mainly in the key cities we covered about 28 million of the population and generated about $61 million of revenue. Today, with 4,800 tenancies across this vast country, we cover well over 45 million people and generate about $192 million of revenue. This is a real impact to the lives of millions of people and real return for our stakeholders as well as meaningful contribution to the growth of the economy, something that I'm personally proud of. So what are the key takeaways of my presentation. Well, firstly, we have a strategic and systemized approach that drive sales and partnership with our customers. Two, all macro and sector indicators underpin our business model and strategy to drive returns and impact. Three, we are well positioned to capture future growth as well as being well structured to deal with market-specific intricacies and complexities. Four, business excellence is a key pillar of our strategy, and we will continue to invest in our people and partners to deliver customer service excellence. And fifth, last but not least, we are all committed to sustainable value creation for all of our stakeholders. This marks the end of my presentation, and I'll hand over to my colleague, Phil Loridon, who will take us through the next section.

Good afternoon, ladies and gentlemen. Great pleasure, obviously, to be with you this afternoon. My name is Philippe Loridon, and I'm the Regional CEO for Middle East, East and West Africa. This afternoon, I will talk less about ratios and numbers, things that you guys like. But I will talk more about the key strategic and operational pillars, which made the success of Helios. And as importantly, the way we've been replicating it across our new markets. This is all about the radical transformations the business went through. How did we do it and the value of the people who grew this business from 3 markets 7 years ago to 8 operating businesses today and soon 10. If there is one takeaway that I want all of you to remember from this presentation, simply the fact that we, Helios have developed a tried and well-tested, systemized way to build exceptional local tower businesses across Africa and now across, but now in the Middle East. But before getting on to this, let me quickly introduce myself. I'm a pure product of Helios, being there from its very beginning. Having run its 2 largest OpCo as a CEO for both DRC and Tanzania. Those have been [ 8 years ] on the ground, [ 8 years ] on the operating field. Over the last 3 years, as a Regional CEO, I've been responsible for most of our markets, except South Africa. And on the top of my Regional CEO hat, I'm also in charge of Market integration. I forgot, I'm French, 57 years old, married and having 4 great kids. I feel being privileged to be part of Helios' history as a key player. But I'm even more excited to be part of the team that will bring this business to the next level, good to great, Jim Collins. So what are the markets, the countries that I cover. Today, I'm responsible for 3 operating businesses. Tanzania, our largest OpCo, is 4,000 towers, then Senegal, a new market that we closed last year with 1,200 sites. And finally, Malawi, our most recent acquisition 6 weeks ago, where we bought 7 towers from Airtel. Those 3 running OpCos represent over 6,000 operating sites. I'm also accountable for 2 other upcoming markets, which we are expecting to launch throughout the year. The first one being Oman, our first entry to the Middle East, a very exciting market for us, where we're close to acquire 3,000 additional towers. The second one is Gabon, the last market to be integrated within our group, taking over 450 sites from Airtel. To help me driving growth in my region, I'm supported by a fantastic and very strong operational team. Starting by Ramsey Koola. Where is Ramsey? There. Ramsey was my first key recruitment back in 2015 when he joined Helios as our NOC Manager. Four years later, he took over the business as CEO and did that for 2 years. Today, Ramsey is also supporting me as my Regional Director for East Africa. Karim Ndiaye is our Managing Director in Senegal. Karim? Where are you? You're all over there. Good. Coming from [indiscernible] and Lean Six Sigma certified before joining Helios, Karim spent the last 12 years, implementing important power project in West and Central Africa. He's also my Regional Director looking at the West Africa markets. Gwakisa Stadi, our MD in Tanzania. Gwakisa has a very similar journey as Ramsey. I recruited him back in 2016 as our financial controller. Gwakisa was promoted CFO 3 years ago. And since last July, he has taken full responsibility of the business. Dr. Matthews Mtumbuka. Doctor, first is our Managing Director in Malawi -- for Malawi, but he's the first Malawian to obtain a PhD from Oxford. Most importantly, Matthews spent over 10 years working for the Airtel Africa Group as the IT Director. Finally, Soany Adamo, our Head of Legal in Gabon, who joined Helios 13 months ago. Soany worked for the Schlumberger Group for many years with regional responsibilities for West Africa. As you can see, difficult to get a better team than this. Did I do anything wrong? Sorry. So what are the key macro in telecom economics of my region? Very similar to the one from Sainesh. To start with, most of our markets, again, a young urban and growing population. 3 people out of 5 are below 30 years old. And the average growth of the region is almost 10% for the next 4 years. But what is common denominator really in both of our regions. It's simply the fact that the mobile penetration is still very, very low in our markets, and in my region, averaging just over 50%. So there is a great opportunity for us and our customers to keep growing those markets, expanding current network capacities because of the data exposure as well as increasing coverage in rural areas. There are almost 18 million people in my region that are still underserved and connected. And therefore, plenty of room for our colo ratio of 1.6 today to keep increasing. How do those markets contribute to the group financial performance? Well, first of all, and by year-end, my region will account for over 9,000 towers, representing 68% of the total group volume of sites, and that includes the upcoming acquisition of Oman. Our Tanzanian OpCo is the largest contributor to the group, the group, not only in terms of number of towers, but in terms of financial KPIs. It's the largest EBITDA contributor to the group, over $120 million expected by year-end with a margin of 65%. And with the Oman upcoming acquisition, those 2 countries will contribute to 45% of the Helios group EBITDA. Overall, my region will reach by year-end over $320 million of annualized revenue and almost $200 million adjusted EBITDA with an average operational margin of just 60%. So hard to create best-in-class local telecom infrastructure companies. Well, one of the greatest example is our Tanzanian OpCo. So let's dive into Tanzania, where we've been able over the last 6 years to build a true business platform for success. As mentioned earlier by Manjit Dhillon, Helios Tanzania started through 2 main acquisitions back in 2011 and '14 with both Voda and Tigo amounting to 2,600 towers. When I joined the company in 2015, it was, at that time, a high expat culture and still a lot to do to drive and improve the performance of the business. 2015 was also the year where the group launched our Lean Six Sigma business principles across the entire organization. So from this situation, how did we turn the business to the success of today? One, first, building up the right team, attracting local talent, boosting local productivity. I mentioned Ramsey and Gwakisa, but there are more that I will mention in the next slide, reorganizing and refining our key operational processes through new training platforms and adequate business tools. We heard about ServiceNow from Lara a few minutes ago. This mobile application that allows our field engineers to report live either by video or picture site defects for us to correct. Engaging more with our customers, Sainesh talked about the Miller Heiman training, which help us to better anticipate on our customer needs, becoming more proactive instead of reactive. Then we implemented our One Team, One Business, I call it Motto, where all stakeholders live the business together, not only within ourselves, but also externally and particularly with our maintenance partners as rightly defined by Sainesh as our hands and feet on the ground. Finally, we launched our Lean Six Sigma business principles and philosophy in every single part of the business. Within 18 months, the entire management team was certified, myself included. But what really made it happen was the fact that by the end of 2017, the local team selected over 30 of our most critical operating processes. Each of those went through a formal Orange belt project in order to be improved. Each of them was thoroughly analyzed. Waste was removed, and our performance across the organization started to increase. As a result of all those actions and 6 years down the line, we were able to deliver substantial growth with a colo ratio of 1.5 when I started to now a colo ratio of 2.3% today. The EBITDA grows more than doubled and our return on capital was multiple by 5 within 6 years. How those key improvements impacted our customers and what have been the key ingredients of our success? Well, back in 2015, as explained by Lara, a few minutes ago, our customers were losing a lot of revenue. And in Tanzania, it was 15 minutes of revenue lost per week per tower. As you can see on the left side, we brought down our power downtime below 1 minute in 2018 and below 30 seconds today. How did we do it? Simply by investing in our people. And when I say our people, it's not only our people, it's also our partners in the field. We instilled across the entire team, the ride -- well, the cultural values of Helios. And as mentioned by Tom, there are 3. But on the ground, it does make a difference, excellence in everything that we do. Integrity, do more what is right than what we like. And partnership, as mentioned earlier. There have been also a huge focus on training, skill gap analysis, talent development, leadership coaching. Most importantly, continuous process improvement has allowed the local organization to keep stretching up internal target, and that really made the difference. Today, 1 out of 3 of our colleagues in Tanzania are Lean Six Sigma certified. As I said at the beginning of the session, a good number of my colleagues have become real stars from the Tanzanian OpCo over the last few years. I've mentioned Ramsey and Gwakisa but there are few other examples. Jaffary was our zonal operating head up north in Tanzania 5 years ago. He is today our group Operation Manager. Rajab started as our NOC admin assistant, is today our group NOC Manager. Jeremiah started as a fuel administrator 6 years ago. Today, he is our group Energy Performance Manager. All this to tell you that it is important for Helios to invest in our colleagues and keep developing talent within all of our OpCos. Integration. So let me now talk more about the key learnings from Tanzania that we keep applying whether we go, wherever we grow. There are 3 main strategic pillars that we keep relying on, and all those are part of our sustainable -- sustainability strategy. First and foremost, our people and ensuring that we have strong operating capabilities within our approach, hiring again the right colleagues and investing in their carrier development. I was a couple of days ago, last Monday, part of the leadership training session at Cranfield University. There were 25 managers of Helios attending that event. I knew that the month before, there was another 25 of our managers there as well attending a similar session. I got to say that I was very impressed by the quality of the debate being brought by those colleagues of mine. And I can tell you that without any doubt, those 50 colleagues have gone through that session are the future stars of our tomorrow business. Our second strategic pillar is a close integration we need to have with our multiple partners. First, with our suppliers and contractors, and this is going back to the One Team, One Business motto, where both partly keep going together and a true win-win partnership. It means working as one team under the same roof within the same office, sharing the same operating tools and driving efficiency and continuous process improvement within both organization and at the same time, close integration as well with our customers, engaging them early enough to maximize sales pipeline at closing. The third and final key learning is to ensure that we do have solid processes in place and that we keep improving on them. This is a basic of Lean Six Sigma and the center pillar of business excellence developed early on by my friend and colleague Allan. For me and deep inside, Lean Six Sigma has been a true eye opener, a real game changer. This has radically changed my way of thinking of operating or managing a business. There will be a before Lean Six Sigma and there will be clearly an after. And what I really like about it is its philosophy. It's all about humility. It's all about spending more time at least into the last element of the chain with the one the most impacted by the efficiency or the inefficiency of the process. So back to our key learnings, how are we optimizing the integration of our new acquired and upcoming markets. We have, within the last 12 months, started 3 new businesses: Senegal, last year; Madagascar last December and Malawi 6 weeks ago; Oman and Gabon remain the last 2 markets to acquire within the next few months. So what do we need to do to ensure that those new and upcoming OpCos are up and running, achieving Tanzania performance standards within the first 6 months from launch. First of all, a strong operational team on the ground. This team is usually composed of an in-country launch team with a launch director and seconded by an additional team supported by the group. Our regional directors as well play an important supporting role. So for me, for example, Ramsey helps me directly on issues in regards to Tanzania or Malawi. Karim help me on Gabon. Then in learning from our past experiences in our 8 existing markets, we have developed a systemized approach to our acquisition integration process. And for this, we have 2 sets of plan. First one is our 100-day plan, which happens pre-closing and which is all about initiating and setting up our new OpCo. It's about engaging as well with our future customers to ensure that we have a robust sales pipeline at the time of closing. The second plan is our 200-day plan, which happens post-closing with 2 key main objectives. One is to improve quickly our customer network performance, making the difference straight away; and two, adding tenancy as soon as we start. So let me go through the Senegalese experience on the next slide. In Senegal, we closed our transaction and started operating our business almost a year ago. Today, and looking back at the last 12 months, the local team has successfully completed the 200-day plan and well underway to drive further operational growth. So how did we achieve this? First, being very early on the ground, not only to interface -- not only to interface with Free, our customers that I'm the seller, but also to engage with the regulator and the other local authorities on the license award process. Usually, in those markets, we are the first towerco to come in. And there is a strong need to educate the regulator on the benefits that we're bringing to the country, which sometimes explain as well the delays we may have in closing a transaction. In January 2021, we recruited Karim and started our 100-day plan. This was all about recruiting the A team, onboarding business partners, testing our operating tools and systems, selecting an office. But as I said as well, engaging with our customer to start building up our sales pipeline. Straight after closing, we then launch our 200-day plan fully focused on improving on customer network and starting delivery growth within our business. To achieve this, we kept replicating the same ingredients that made Tanzania successful, implementing our business excellence program and Lean Six Sigma derived process. As a result, Karim and his team within a year of operation has been able to achieve a down time per tower per week that is below 10 seconds, Lara was talking about 6, which is the best-in-class group wise. But as importantly, the team because of their earlier engagement with those customers, we're able to secure 160 build-to-suit with the last one to be actually delivered in October this year. Where did we replicate the learning from Senegal? Well, and to start with in Madagascar in December last year. But also in Malawi, which started business barely 6 weeks ago. In Malawi, we have improved our uptime by 50% since March. As importantly, the local team has secured and signed our 43 build-to-suit in over 100 colocation. Talking about Oman, our first new OpCo in the Middle East, Ramsey has already launched our 100-day plan 10 weeks ago. Today, we have recruited 85% of our management team. Staff onboarded is over 60% and full [ audit of ] sites have been completed, preparing our tower for future colocations. In Oman, and over the last 3 months, the team has consistently engaged with our customers with both: one, Omantel, our anchor tenant, but also Vodafone, the third mobile entrant who just launched their network last December. And we hope to be able to repeat in Oman the successful Airtel story in Tanzania, where Airtel are the fourth mobile entrant back in 2015, jumped on to 1,200 of our towers within 6 months. So the next few months are going to be very exciting for the team in Oman, and I can tell you, we are ready to go. Finally, our last slide and the main takeaways from my session, our presence in strong market positions with significant growth ahead. We are the sole and leading independent towerco in all our markets. Mobile penetration remains very low. We said that. And therefore, huge growth is expected in our countries, pushing our customers to further expand the network by increasing capacity and coverage. Takeaway number two, business excellence and Lean Six Sigma, embedded across our different OpCos continued to be the pillars that keeps making the company successful and most importantly, growing. The third takeaway is about our seamless, agile and replicable integration approach, whereby having the right team and the right processes in place minimizes our risk when starting new in a country. Finally, foundation set pre-closing to deliver immediate tenancy growth and operational improvement. And as I mentioned earlier, this is what the team in Senegal has delivered throughout last year, and this is what we are currently delivering today in Malawi. I may have taken a bit more time than expected, and I apologize for that, but difficult to do better when you keep talking about the value of your team. As you would have noticed throughout our session in the beginning, since 1 p.m. today, people are the most valuable assets of our business. And this is the reason why I keep enjoying my journey 12 years down the line at Helios. To me, there is no better satisfaction. There is no better fun in a professional career than to work with colleagues that you see keeping growing, leaders that you have invested in, leaders that you have developed and that's where to me, the real fun is. I'm closing my session here. Thank you for your attention. I think we have a break right away, 10 minutes, and then beautiful Sima will take over from me.

Good afternoon, everyone. I'm Sima Varsani, I'm Group Head of Sustainability. In this next session, I'll be talking to you about our ambition to drive and to deliver long-term sustainable impact for all of our stakeholders. To start with, I want to give you one example of what we mean by impact. And I'd like to do that by sharing Patricia's story with you. [Presentation]

This video is on our website, and it was filled 2 years ago pre-COVID. Since then, Patricia has grown her business. She now employs over 50 women drivers. And during lockdown to support communities, she also expanded her business to do vital food deliveries for communities. This is just one example of how mobile has changed lives, has improved livelihoods and driven growth and innovation in our markets. And there were other stories on our website that you can look at, too. And it's these stories that make me so excited and so passionate about what we do and it's why it's so important for us to continue growing our business, expanding our infrastructure and delivering on our purpose to drive the growth of mobile communications in our markets. Before we talk more about that, a little bit more about me. So I joined the business 2 years ago, 2 years ago, tomorrow, in fact. And my role is really to drive our positive impact by working with different teams and functions across the business to embed sustainability to look at collecting and analyzing more ESG type data to help us make better business decisions. I started working in sustainability almost 12 years ago, and I have experience across consultancy and across corporates. But before I joined Helios, I was at GSMA, where I was a Sustainability Director, and my role was advising international MNOs, including a number of our customers on how to integrate sustainability into their business. And when I joined Helios, I saw lots of synergies because ultimately, we're in a value chain. We're all looking to deliver the same impact for more people to use mobile and for more people to benefit from the life-enhancing services that it brings. So I hope that you already have a sense of what sustainability means to our business through all of the presentations that you've heard today. In this session, I'd like to highlight more of the macro context of how mobile is driving sustainable development and how that has informed our strategy and our ambition for impact. When we talk about our impact, we're building on strong foundations. So Tom, at the beginning, shared our business story in the different phases, and our impact has grown in line with those. In 2010, we were the first towerco in Africa, bringing the infrastructure sharing model to MNOs in Africa. In 2015 saw us prioritize business excellence, which you heard from Lara and Allan about. And then Phil really just brought to life here are championing of local teams for local business. In 2020, we developed our sustainable business strategy. When I joined Helios, the leadership team was looking to articulate a sustainability strategy. But when we went through the strategy development process and we looked at our materiality, it was clear -- very clear, very quickly, in fact, that actually, we were articulating our business strategy for long-term success. And we've produced our first sustainable business report, which was, again, the first comprehensive communication really about our approach on all of our material issues and our progress on the KPIs and targets which we had formalized. So where we are today when we look at 2021 and on the value that we've created is really an evolution of this journey. But I think back to 2020, we were analyzing our carbon footprint and what makes up our carbon footprint. And today, we're starting to look at how we're going to achieve net zero by 2040. For me, this is a real reflection of our ambition. And I'm really proud that actually it's our leadership team, it's our Board that is championing sustainable business as better business and wanting us to maximize our impact. So now let's take a step back and look at the impact of mobile more broadly. There is clear evidence that mobile drives sustainable development. The mobile industry is unique in the fact that it can contribute positively to all 17 SDGs. We saw the story of Patricia. Mobile is driving economic growth. It's also driving good health, education. It's allowing millions of people who have never had a bank account to access financial services for the very first time. These are just a few examples. The GSMA produces a report every year called the SDG Impact Report. And in it, it shows how mobile is contributing to each of the goals and the contribution that it's making to each goal is increasing year-on-year. Last year, the UN accredited the mobile industry for making critical breakthroughs in climate change. And that's because mobile can avoid emissions. It can avoid 10 times more emissions than it creates itself. That's through things like the Internet of things and making things smart. So we're really proud to be part of a value chain that is helping to tackle these global challenges, but also through our own business, the way that we work, contributes to a number of SDGs that you can see here. Phil really brought to life SDGs 8 by how we work with our own people but also with our partners, creating safe workplace, safe work environments and investing in our people and our partners, which leads to economic productivity. And through our building resilient infrastructure, we are contributing to SDGs 9, industry innovation and infrastructure. So the mobile industry generates significant economic value. I can't remember where the pie was, but it's -- but globally, mobile contributes 5% to GDP. In our markets, we generate more value. In Sub-Saharan Africa, it's 8% of GDP. In MENA, it's 6%. Mobile also makes a significant contribution to public funding and creates significant job opportunities. Now when you consider everything we've heard today about fast-growing economies, young, urbanizing population, mobile is going to be so critical to the future prosperity of our markets. Through what we do, this is on to the next slide, which is about enabling mobile faster expansion. Through what we do we're driving digital inclusion. We're helping our customers to increase and improve coverage in our markets. The slide that was supposed to be here, that you see in front of you is build on what Sainesh said about DRC. For me, this slide sums up our sustainable business model. In 2015, 78 million people came under the coverage footprint of our towers. In 2015, 78 million people came under the coverage footprint of our sites. When you look at -- when you look at it today, including our acquisitions, we're looking at almost 160 million people. That's double the number of people in 6 years. Now when I think back to Patricia and I think about how mobile is changing life and improving livelihoods, for me, it's inspiring. It's all inspiring. But what makes it even more exciting for us is that, that this impact in terms of digital inclusion and coverage is fully aligned to our business growth. Over the same time period, you can see our tenancies over doubled, our revenues over tripled. This is why we call it sustainable business. It makes complete business sense for us to help more people use and more people benefit from mobile and to support the development of our communities. Our projects address local needs. In Sub-Saharan Africa, less than half of the population has access to electricity. And even the half that does, doesn't have access to reliable or consistent electricity. So to help encourage and help more people to use their phones, we offer phone charging points for the community to come and plug their phones and use for free so that they can actually use their phones more. In terms of digital inclusion, over half of the population that is covered by mobile Internet is not actually using it. One of the main reasons for this is lack of digital skills and digital literacy. So to break this barrier, we are engaging with schools. We're building ICT labs. In Ghana, and Fritz can talk about -- talk to you about this more -- in more detail. We're working with a rural school, which has about 200 children -- 200 students. It's never had a computer before. We've partnered with 1 of our customers to refurbish 1 of their old active equipment shelters. We've equipped it with solar panels and we furnished it and we donated recycled laptops and we're delivering mobile broadband connectivity. There's examples like this that show actually how aligned our strategies are with our customers. We've also recently launched a group-wide internship program called the Helios Towers School of Engineers, which offers engineering students and graduates opportunities to gain hands-on work experience within our business. This not only build a pipeline of talent for us and our partners, but also contributes to improving employability and economic growth. We're trialing this in DRC at the moment, and we have a view to sort of roll this out across the group. We're also setting a target for female representation to drive our impact on gender equality and to support more women in STEM in our markets. I hope with these 3 examples, you can see that our approach moves away from traditional CSR as it were, and much more towards strategic social investment that not only benefits our communities, but also benefits our business. So our 5-year sustainable business strategy is the way that we are going to deliver on our purpose and our mission. Strong governance and ethics underpin the strategy. And as I said, our Board and our leadership team are accountable for the delivery of the strategy, but ultimately, there are also the champions of it. So how do we know and how will we know we're making progress? These are the KPIs and the targets that you've seen throughout today's presentation. They reflect our ambition and where we want to move the needle. If you look at people and business excellence, we set a target for gender diversity. We want to move from 24% in 2021 to at least 30% in 2026. And when you consider that we work in a traditionally male-dominated industry, and you look at our cultural context in our markets, this is a stretch target, and we want to drive real meaningful change for gender equality over the long term. On the environmental side, Lara already spoke to us about our 2030 intensity target, but also our ambition for net 0 and the fact that this is going to require systemic change for all businesses, but also for us, and it's going to require real collaboration across our value chain. And it's great that we've already started talking so closely with our customers on this. In line with our commitment to sustainable business is our commitment to reporting and transparency. In March this year, we published our second sustainable business report, and we are using best practice reporting frameworks and standards to not only inform our reporting, but also to guide our approach and our strategy, looking at indicators looking at data to again help us make better, more informed decisions. Our focus is on improving our reporting, but also our transparency initiatives, such as CDP, which we started responding to last year. And we're also starting to be rated by various rating agencies. So what do I hope that you take away today that mobile drives sustainable development? I hope you remember Patricia's story, and I hope that you go on to our website and you look at the other stories that are there. But we have an inherently sustainable business model, but we also want to go further, and we -- and we'll do that via our new sustainable business strategy and that we are committed to be open and honest about how we're doing on the journey. So with that, I'll hand over to Manjit.

Thanks, Sima. I think that Patricia example is actually really, really interesting? And we've got a number of those actually on our website. We tried to bring our markets to you during this session. And hopefully, in a year's time, we can take you to the market. You can actually see it firsthand about how -- what we do really does provide a real difference for people's lives. But on to a different tact and go through the financials and guidance. Just to start off, we released our Q1 results this morning, and I'm going to give a very quick recap of those results now. So we had a seasonally strong Q1 this year with regards to tenancy rollouts and our financials were in line with our expectations and guidance that we've given at the beginning of the year. We've seen strong organic growth of 359 organic tenancies added in the quarter, 1,545 organic tenancies year-on-year, which drove a 9% growth in organic sites and tenancies and 10% organic growth in revenue and EBITDA. Including new acquisitions, we've seen year-on-year growth of 23% of revenue, 20% EBITDA and 34% portfolio free cash flow. EBITDA margin has slightly reduced by 2 percentage points, and that's due primarily to the integration of new markets, and I'll speak about that very shortly. Exciting as well as Phil mentioned, we closed our eighth market Malawi. And Phil, Ramsey and the broader teams are working very hard on closing Oman and Gabon during the next course of this year. And importantly as well, guidance has been reiterated and I'll go through that detail in a few slides time. There, we just set out a few of the key metrics on a group perspective. And as mentioned in the last slide, we're seeing good progression in tenancies, especially considering Q1 and Q2 are our seasonally quieter quarters. That's particularly because MNOs are going through their budgetary processes during the course of this year. So we typically see a bit lower seasonality than it really picks up in the second half of the year. And it was great work by Allan and Lara and their teams and the teams on the ground to get the tenancies rolled out quickly at the start of the year. We've managed our supply chain effectively, forward purchasing 30 million last year so that we could really hit the ground running. We've seen adjusted EBITDA and portfolio free cash flow growth, and that's driven by both our organic and inorganic tenancy additions. So we're progressing very well. But you'll notice, again, tenancy ratio and EBITDA margins are slightly reduced and again, due to the impact of some of the acquisitions coming through. And here, we just set it out diagramatically what's really been happening and some of the moving parts for the margin dilution at least on an EBITDA perspective. And we'll see this right now for Q1, and we'll see it for the rest of the year as well. And the majority of the movement, related to EBITDA margin, is purely mathematical. As I spoke through during my section earlier, we acquired low-margin day 1 portfolios, and then drive lease-up and returns. And here, you can see that pre-acquisition, our margin was 54%. The combined margins for Senegal and Madagascar was 45%, and pro forma the impact is to reduce margins by 1 percentage points. For the markets we are due to acquire or just acquired in the case of Malawi, the margin impact is neutral. Importantly, we've also invested in our SG&A base, given that we've doubled scale and size of platform and that Phil spoke about earlier, some of the structural changes that we've had within the business. But the combined effect of the M&A and SG&A investment means that we see margin dilution down to 51% to 53% by year-end, which is in line with our guidance. Now in preparation for doubling from 5 to 10 markets and doubling our tower footprint, we've invested in our SG&A. So that we can deliver for customers on day 1 like we have in Senegal. In total, including spend in 2022, we will have incurred $13 million and that is principally setting up on recruiting the new regionalized structure, increased professional fees and having a broader infrastructure, for example, IT. In 2020 and 2021, we had incurred some of that SG&A early, and you can see the elevated levels of SG&A as a proportion of sites and revenue. However, the investment that we made -- that we have made will be leveraged by the expanded portfolio, and we'll see corporate SG&A as a percentage of both sites and as a percentage of revenue returning back to 2019 levels. Now I discussed the impact of acquisitions. And again, portfolio purchases can be accretive on day 1 to a number of metrics for example, a number of sites, adjusted EBITDA and a quantum perspective, contracted revenues, but also dilutive to tenancy ratio margins and ROIC. As you can see on the far right-hand column, we see in red where it's been slightly dilutive and green where it's been very positive. Importantly though, we will grow from here, and we guide towards 0.05 to 0.1 average tenancy ratio increase per annum. Again, there'll be some years where we see increases and decreases in this range, as explained earlier. But over the medium term, we'll see that being the average that we'll find. We also expect to see margin expansion of 1 to 2 percentage points per annum over the medium term. Now what will drive this? 3 key areas: lease-up, leveraging our cost base and operational improvements. The lease-up is going to be utilizing our proven execution capabilities on the expanded platform and driving tenancy growth. And this is with the backdrop of the really compelling structural growth drivers of 25,000 points of service over the next 5 years. Second, leveraging our cost base. Whilst we're still going through some upgrade work on some of the recently acquired sites, on average, we have structural capacity for 3 to 4 tenants, meaning we can move very, very quickly when we get that colo water coming through. We can also look to further leverage our SG&A investment and per site fixed costs. And as always, we look to operate sites more efficiently, utilizing business excellence principles, investing in renewable power systems where possible to reduce the usage of fuel, which again is our most costly form of powering site. Now taking a look at our cash flow. And this bridge sets our sets up pro forma for acquisitions, the key blocks to get to portfolio free cash flow. Nondiscretionary CapEx and ground lease payments are both broadly fixed at $3,000 per site so as we add more tenants to towers, these costs will be leveraged. And from a portfolio free cash flow perspective, we'll see conversion in the range of 65% to 70%. As we grow our EBITDA, we'll not only leverage some of the fixed costs we see on an OpEx perspective and SG&A perspective, but we'll also leverage the nondiscretionary CapEx and ground lease payments too, and you'll see that all coming through within our cash flows. And that will all be utilized on a disciplined accretive investment. And here, we set out our capital allocation priorities. Firstly, to reinvest in the business, to drive organic growth and margin improvement. And that will be primarily through colocations on our expanded platform as well as further build-to-suits and investing in power improvements through our Project 100 program, reducing again the utilization of carbon heavy power forms. Secondly, investment accretive acquisitions. Similar to what we've done, we will continue to look at attractive portfolio acquisitions in our existing markets and new markets, and we expect to purchase circa 4,000 to 5,000 towers over the next 5 years, in line with the '22 x '26 strategy. And finally, we're focused on returning cash to our shareholders and aim to pay a dividend over a 3- to 5-year time horizon. Fundamentally, utilizing the capital for the purposes I've just set out, principally reinvesting in growth will drive return on invested capital. We've seen great progression in return on invested capital from 2016 to 2020. And you see that it's really driven by the tenancy ratio growth and EBITDA margin growth that we've seen on the left-hand box called out there. But also coincided with a steady reduction in discretionary CapEx, you see on the right-hand side. Following the expenditure for new markets, we've set the base for driving compounding growth from this broader base and will be focused on increasing our return on invested capital over the coming years. Now for TowerCos, there is a dynamic of net income, not necessarily being the best indicator of TowerCos performance, unlike other industries. And this effect is really demonstrated on the left-hand side. Towers have accounting depreciation of about 12.5 years. However, they can stand for 40 years plus. And so there is a disconnect between the book value that you see and the real value that we generate from these assets. And this dynamic is the same for all TowerCos. And what you effectively find is an element of accelerated depreciation in the early years, which will have a negative impact on net income. Now whilst net income is something we continue to monitor, cash generation is our real focus. And continuing to drive long-term cash compounding growth. Now a quick look at our balance sheet. We've worked very hard at reducing our cost of debt, and we have produced that substantially over the past few years to 5.9%. We continue to target net leverage between 3.5 to 4.5, and expect to be towards the top end of that range following the closing of all of our acquisitions by the end of this year. Importantly, whilst we target that range, that is a target, and it can operate if needed, both below and above it. Indeed, we've operated below it for a number of quarters and have ample covenant capacity to operate above it should we so choose. But all things being equal, once we hit the target range of 4.5% following the acquisition closing at the end of the year, we expect to then delever by roughly 0.5x per annum on our organic profile that we expect. With the recent financings we've completed, we're fully funded for all near-term organic and inorganic growth with no immediate need for further raising. And we have average year remaining on our facilities of 4 years. So stand here today in a very strong position. However, as always, we keep a keen eye out for further ways in which we can optimize and reduce our financing costs and remain agile and ready for exploiting such opportunities. So just now to focus a little bit on the guidance. Now I say simple business model at the top, but hopefully, over the last few sessions, you understand, but it's actually far from simple and actually doing these things. But just to go through how the business model works mathematically, from a tenancy perspective, you bring forward your sites at the beginning of the period and you add the site rollout for the year. Same goes to colocations. And we typically see a seasonality in our rollout intra-year. So we see typically 25% of tenancies rolled out in the first half, 75% in the second half. You then take the average tenancies for a period, if you time it by the lease rate per tenant and you affect that by the adjusted EBITDA margin guidance that we'll give in a slides time. That will give you adjusted EBITDA. And then for CapEx, how to do the main building blocks, you take your nondiscretionary CapEx per site, times by the average sites in the period. And for the new rollouts, you take your number of sites and colos by the average cost of builds and cost for a new colocation. Again, guidance I'll be providing in 1 slide's time. Add on to that, you had any acquisition upgrade or other investments on top of that. So going through some of these more detailed guidance points. Now the guidance is actually identical. So I provided at the year-end, you just set it outside differently. So for 2022, we target 1,200 to 1,700 organic tenancies for the year for our 7 markets, that's excluding Malawi. And 60% of those will be sites, 40% of those will be colocations. And again, seasonality profile, 25% first half of the year balance in the second half of the year. These rates are expected to increase by 3% to 5%, and we should be seeing up during the course of this year and adjusted EBITDA margin being somewhere between 51% to 53%. Now as we integrate the acquisitions, which are there at the bottom, we'll then have an expanded portfolio. And over the medium term, we expect to see 1,600 to 2,100 organic tenancies per annum, which initially 40% will be new sites, 60% colocations gradually reducing down to 30% sites, 70% colocations, again, similar levels of seasonality. And we expect to see our EBITDA margin increase by 1 to 2 percentage points per annum. A lot of focus here on CapEx. So again, just building on the building block I said a couple of slides ago. Effectively, for a new colocation, it's about $10,000 per colocation. For new sites, the range can be anywhere between $100,000 to $150,000 per site. We'd say take the midpoint of $125,000 for modeling, but it can be within a range. And we're looking to invest $10 million on Project 100 investments during the course of this year, including batteries, grid connections, solar investments and $5 million on non-power projects as well. We did a $30 million pre-order during the course of 2021, which is incorporated in here too. And we've got a little bit on upgrade $30 million to $40 million, and that's we to get the new sites to be purchased up to the Helios Tower standard ready for colocation. And we've got about $650 million that we've guided for the full year for the closing of acquisitions which we previously announced. And again, the final piece in the building blocks is 3K per site, the nondiscretionary CapEx. Medium-term guidance, you effectively just utilize all the assumptions there and just tech the model to the right. But one thing I would call out though is that whilst you've got elevated CapEx for this year, we do expect it to be coming down in the medium term in the region about $145 million. And again, going back to that return on invested capital side, that discretionary CapEx kind of coming down, what's driving return on invested capital on the established base. Now going to the final piece of our guidance. Interest costs, as it stands today, about $95 million. That will increase to $105 million when we fully draw the debt for the acquisitions. We expect that to remain very stable over the coming years. Grand leases, cash costs about $3,000 per site. We do have some exceptionals, but they are exceptional in nature and related to the deals that we signed and some prework for new financings. Tax, we expect 4% to 5% of revenues in 2022, increasing to 6% by 2026. And working capital, we don't expect any real changes, just effectively modeling the same days assumption for receivables and payables. So how are we trending towards this? Well, Q1, we're effectively hitting all of the targets that we set out, had a good rollout within Q1. We've seen good tenancy seasonality. In fact, slightly ahead of where we were expecting to be. So that's fantastic. Lease rate per tenant was being 2%, as you calculate, the escalators coming during the course of the quarter. So about March, we're actually well within the guidance that we set out, and you'll see that coming through in Q2 and EBITDA margin at 52%, stating in the middle of guidance. Now with regard to '22 x '26 finance considerations, we expect that given the cadence of when the acquisitions will come through -- as Tom mentioned, in about 18 months to 2 years' time really when we start to see those acquisitions come through, we will be able to utilize the combination of cash on balance sheet, debt capacity to fully fund that with no requirements for equity. We expect about 3,000 to 4,000 of sites will be embedded in our model to be built organically over the medium term, the remainder being purchased. And given the timing and given the expanded base that we have for the business, we expect marginal day 1 impact on our tenancy ratios and adjusted EBITDA. If we have seen the same characteristics to the assets that we recently purchased. But fundamentally, this strategy targets material increases in adjusted EBITDA and returns expansion over the medium term. So a few key takeaways from finance and guidance. Our platform is fully invested for growth in our new and existing markets. We take a very disciplined approach to capital allocation with a focus on accretive growth investments. We are fully funded for all of our near-term organic growth and announced acquisitions and our '22 x '26 strategy is expected to be funded exclusively through cash and debt. Now I'll pass it over to Tom for some wrap-up remarks.

Thanks, Manjit. And thank you, everyone, for your time today. We really appreciate you coming down. And yes, it's great to do this actually. It's been a long time since we've done something like this with everyone in the room. In fact, I think last time was at IPO in 2019, probably in little room. So great to see everyone. Look, I won't take a huge amount of time wrapping up, because we've got the Q&A now. But just, I guess, to remind everyone, what have we heard today? Well, we're uniquely positioned tower business operating solely in Africa, Middle East. We've got unparalleled structural growth in our markets. And with our market positions, we're very, very well positioned to capture that growth and support it and accelerate it. We've got proven execution capability, business excellence, Lean Six Sigma, very experienced teams. And of course, as we've just heard from Manjit, we've got very robust earnings stream and cash flow stream. High-quality, high hard currency mix and very strong customer base. And finally, wrapping all of that up, sustainability really is at the core of everything we do and at the heart of our operations, which we're very, very proud of, and that will continue for many, many years ahead. So that's it for the presentation. We've now got Q&A, which can go on as long as people want. I think Manjit and I will be on stage. Other members of the executive leadership team are at the front or dotted around the room. So if people do have questions, then please go for it. I think I can see the first 1 there. All right.

Thank you all for the significant and thorough presentation. I have 3 questions, if I may. Firstly, you talked about inorganic growth coming in 18 to 24 months' time rather than sooner, why is that? Is that through choice? Or is that through availability of assets that you find attractive? And secondly, anything -- any comfort you can give us about the lack of any conversations about MNO consolidation and customer consolidation in your markets? And thirdly, also, any comforts that the governments that you deal with are not attempted to want to get a bigger share of your cash flow. That would be great.

Yes, John. Thanks John, for the questions. I'll take that, and Manjit you jump in as well if there's anything else. So look -- inorganic timing, look, our key focus right now is to integrate and consolidate the acquisitions we've done. We've clearly been extremely busy in the past 2 years, negotiating and signing acquisitions. And now we're in the midst of closing all of them. What comes along with that is not just a legal closing process, but bringing on a huge amount of new people, both internally, but also externally through our partner networks, the maintenance, the securities, et cetera, in all the markets. So there's huge trading programs going on in the background. There's huge upskilling. So we really want to focus on getting all of the deals closed, getting all of the markets up to a certain level of performance and really driving the organic growth and performance. Getting that tenancy ratio up, we've heard a few snippets from fill about in some of the new markets where we've hit the ground running on some colo deals, et cetera. So that's what we're super focused on right now. And then over a 5-year period, clearly, there's 300,000 towers out there, which are still owned by mobile operators. Some of them are going to come for sale over that time. And some we will like and some we won't, but we want to be positioned to -- if we do believe the portfolio will add significant value to us to go for it. And based on our knowledge of the pipeline out there today, in fact, it coincides quite well actually with our current focus of this year and next year focusing on the organic and what we've announced and then maybe in a couple of years' time focusing on a little bit more geographic diversification. But I don't think we'll do a doubling of the business overnight again. It might be like 1 extra market and another extra market the following year or something like that. So more kind of incremental rather than a big bang, which is what we've been doing recently. M&A consolidation, yes, look, it happens sometimes. I mean in our history, we've had a couple. We had in DRC in 2017, I think, Orange acquired Tigo. The market went from 5 to 4. In Ghana, the market went from 4 to 3, I think, in 2018 when Airtel and Tigo merged. Is there any on the immediate horizon right now? Nothing particularly obvious. I think in South Africa, what we've seen recently is Cell C has done a deal with MTN to do national roaming on the network. So in a way, that market has gone from 4 to 3. From a infrastructure point of view, even though from an end-user point of view, there's still 4. That was actually good for that market. I think that market needed it. So that makes economic sense. But in our other markets, Tanzania is a 4-player market. I can't see that consolidating anytime soon, is highly competitive. No mobile operator there is a clear sort of #1, DRC, very similar dynamics for operators, all really competing with each other. So none of that seems on the horizon. On the contrary, actually, in Oman, we've obviously seen a new entrant. So that market has gone from 2 to 3. That was 1 of the attractive reasons for entering. And in fact, in Malawi, there's probably a new license being issued as well. So in a way, it's slightly going in the opposite direction to consolidating, which is good news for us. And it's really all driven by the just a huge runway ahead of new subscribers that are out there for mobile operators to capture. So nothing on the horizon on consolidation. And then finally, yes, look, governance -- I mean, look, taxes, regulatory fees, et cetera, sometimes through our history, we've experienced some increases in DRC about 18 months ago, they brought in a regulatory fee, which actually was more just aligning the DRC to the other markets, the regulatory fee and DRC had been virtually 0 for 10 years, and they bought 1 in, which effectively aligned it with other markets. We've also had tax decreases finally enough as well. So actually in DRC, again, about 3 years ago, they reduced corporation tax from 35% to 30% in an attempt to attract more foreign investment. So there are some ups and downs. We don't see any sort of material ones on the horizon either, but we stay close. And obviously, we'll try and push back if anything come about, but nothing to tell people about today on that.

And the only thing I'd add on the M&A point actually is that whilst there's no consolidation in a pace like Tanzania, you've now got Millicom sold their stake to Axian. So you've now got actually a very motivated new entrants who's absolutely looking to invest and make raising that market. So we're seeing a combination of new entrants coming into some markets, a bit of a cycling and rotation all breeds to a good positive vibes for us as a company.

It's Simon from Barclays. Sorry, another 1 on M&A. You obviously had a successful couple of years with M&A, but we also saw rates coming down. Now we're seeing rates go back up quite significantly. What does that mean for your conversations on valuation and in the plan where you say you can finance things with existing cash flows. Is that assuming valuations stay where they are, come down, go up. So any color around that would be very helpful? And then linked to your capital structure, you're highlighting that more and more of your EBITDA comes from high currency. You say you'll do M&A to diversify further in a couple of years. Just wondering how you think about the overall capital structure. Is there a temptation to take leverage may be a little bit higher, given you're going to see more EBITDA coming from hard currency. Any sort of color on how you see the capital structure developing would be great.

Yes, sure. So I'll take the first point on rates. So I think, yes, we are seeing rising UST rates, absolutely. But you've also got to bear in mind that whilst that is happening, we're a very different business to what we were when we did our last financing, where you've seen this reduction. So from a blended perspective, when we did our raising before, we did our raising on the promise of potential M&A, but now we've actually done it. I'm not saying that we've done it in very high credit quality markets like [indiscernible]. So our structure is actually very different and our hard currency earnings go up. So I would say, once you got a backdrop of rising rates, you've also got the counteraction of our business being far more solid from a credit perspective as well. So I still think that there's ample opportunity to look for ways in which we can reduce our debt going forward. We're looking at some of those in the background, as it stands right now. But I think the positive point here is that, as there is no real need to do any financings right now, we can wait for our time in which we want to try and do any incremental financing to bring things down. And one of the things we've also looked at is doing a blend of different financing. So you've got bonds. We've got term loans at group, you got term loans at OpCo. We got convertible bonds. We've got a full suite package. So we can look at utilizing any of those in the future as well. I'll just touch on capital structure and then Tom, if you want -- if you have any other further comments. But in terms of higher leverage that we have covenant capacity to do so. I think we try to keep a relatively prudent measure of 3.5 to 4.5, but we reserve the right to change that should there be a compelling reason to do so. So there's a good acquisition that comes about. We've got the capacity to do it, and we'll monitor it at the time. But again, we've got good high currency long-term earnings. It does, to some extent, mean that we could go higher if we should choose to.

That's great. Just -- sorry, just a follow-up. So in your conversations with MNOs, I know you're saying it's like a couple of years go -- away, but presumably you're having initial discussions, have you seen any change on sort of valuation demands? Are M&As being more sort of demanding given where we see valuations go in Africa and Europe, even Latin America as well?

Yes. I mean the answer is no. I mean, we're sort of a too early point in the conversation, to be honest. So yes. And look, I mean, I think that evaluations depend on a lot of different things. Obviously, rates is one of them, but kind of colocation potential in the country, things like that can mean that some towers are valued $50,000 and others are valued at hundreds of thousands of dollars. So there's other factors at play. But yes, we're not at that point yet in any kind of big live discussions.

Just again 1 on M&A. We've seen in Europe, some of the M&A actually going and doing TowerCos by themselves. So are you seeing maybe a risk in Africa to have some kind of a similar path and thus reducing your inorganic opportunity? And then second question on margin expansion. Is there a mix in between tenancy ratio increase and some efficiency gains you could have from diversifying your power supply sources?

Yes. No, sure. So first, on the MNO led towerco question, so obviously Vantage is 1 we've seen recently in Europe. Let's talk of, TOTEM, I think, is the Orange one. And we've seen this around the world over the years. In India, there was a few well-known ones, Indus, Bharti Infratel, et cetera. And some mobile operators have reasons to prefer that route. That's fine. Typically, Vodafone and Orange globally in their history, have typically shied away from selling their assets whereas other mobile operators like Airtel, like Tigo, like MTN and others who we've done deals with more recently like Omantel, for example, take a more asset-light approach to their business. In Africa, I mean, there are different dynamics to Europe. Firstly, there's a much more operational component to a towers deal. So if a mobile operator is thinking about selling their towers, whereas in Europe, it's a lot more of a financial engineering play. In Africa, it is that, but it's also, as we've heard today, huge operational players well basically outsourcing running the power particularly. And I think that whilst in Europe, something like Vantage, was possible in terms of the regulation in every market and sort of getting it to the same point at once, maybe in Africa, that would be more difficult from a timing perspective. So I think we'll see how it goes. But even if you remove the operators such as Vodafone and Orange, who traditionally have not sold their towers, if you look across Africa, Middle East, there's still significant potential there over the coming years for further divestments even if you remove those 2 from the mix, which typically we would attribute to a lower probability with those 2 players for buying that towers, for example, even though we did buy Vodacom towers in Tanzania in 2014, which I think is actually the only time Vodafone group had ever sold their towers.

I'll pick up the margin point. So the guidance that we gave of 1 to 2 percentage points that's not all driven purely by colocations as an element of that for source linked to some of the power investments that we would be daring, but there could be step changes in that. Like we've heard from Lara earlier if you see proliferation of grid accelerated at a multiple and that will certainly have an impact, and we'll be updating guidance in due course. But we're taking a phased approach for this Project 100. We don't want to put all hundred millions throughout right now because you know there's lots of changes coming. So we'll see that margin progressed, but I think there is certainly some potential upside in the future.

I'm Abhilash from Berenberg. I've got one on colocation, please. You've talked about your ambition to continue to increase colocation rates. Just wanted to understand what are the major challenges as you seek to do that? I guess in 2022, we are seeing that the tendency growth is more weighted towards BTS. Why should that change going forward? I mean, what is stopping these operators from just building new sites as opposed to colocating on yours? And just maybe slightly related to that point, if you think about return on invested capital, you showed us the slides where we can see the strong progression in DRC and Tanzania. And obviously, you targeting something similar for the group going forward. Is there a figure we can keep in mind, where you can get to by 2026 as you execute over this plan? Obviously, I guess it will defer with and without M&A that you're planning, but what's the kind of returns do you think you can get to at the end of this plan?

Yes. Just on the -- so on the first point around colocation versus build-to-suit that mix does change each year. It's largely driven by what our customer strategy is in each year, as it happens at the moment. Some of our key customers are looking to drive their own coverage in new areas, which typically have not had that -- either had 0 coverage or not much coverage before. So particularly in areas like Central and Eastern DRC, for example. We're doing quite a lot of rollout at the moment of new build-to-suits. Other years, they might focus on increasing their stronghold in existing positions, and that would be capacity rollout predominantly, which would typically be in areas where we have a lot of sites already and they can do more colocation. So it does go in sort of ebbs and flows depending on what the strategy is for the given year. I'd say the good news of right now than the fact that operators are looking for new areas of coverage, which is why we're doing a lot of build-to-suits, it actually implies that they're searching for that new fringe subscriber acquisition, which means that there's simply more people in the country who are getting phones who have more disposable income to be able to afford a SIM card. So that's actually quite a good subliminal indicator, if you like, on disposable income and the proliferation of mobile more and more into the more rural areas. Next year, it might be a few of the customers are really focusing on capacity, in which case it might swing that to colocation. Just on the ROIC, Manjit, do you want to answer that?

With the dilution that we've had, given the acquisitions, some of those come with mid-teens. So about 6% ROIC on average for the new portfolios. So that's bringing us stands about 9%. Where do we get to by 2026, excluding new acquisitions, I think we'll see ourselves in the low teens, where we'll get to. So we'll probably keep somewhere like that 10% -- somewhere in the middle of 10% to 15% probably by 2026.

It's Jeremy Dellis from Jefferies. I had a couple of questions as well, please. Firstly, I'd be interested in what sort of the underpinning of your midterm guidance is in terms of the sort of the economic growth rates in your kind of core markets? And to what extent do you think it's valid to be concerned about sort of operator network investment plans being sensitive to levels of economic growth in national markets? Second question would be, I'd be interested to understand the nature of your sort of discussions with key governments and regulatory sort of officials, as we've embarked in this sort of situation where inflation is escalating rather quickly. What are the conversations that you're having with them? Just to help us understand why you are sort of evidently quite kind of confident that you're on a firm footing. And then finally, in relation to your tenancy ratio growth forecasts. Now I mean, clearly, that makes sense. But would it be fair to say that higher lease-up takes you into a world where maybe not all of your tenants are going to be sort of blue-chip multinationals and perhaps to a slightly different sort of counter party? And to what extent do we need to sort of bear in mind a different way of dealing with such counterparties in the future?

Sure. Thanks. Thanks, Jerry. Let me take some of those. So look, in terms of the government and regulatory discussions. Typically, we don't interact with governments and regulators on these sorts of topics. We have contracts with our customers. They've got a very clear black and white escalations within the contracts that happens, whether that's quarterly or annually. For example, we've just done a lot through Q1 where we have a lot of the annual CPI escalators kick in, for example. And that is just a process of billing. And the customers, by and large, know that, that's how it's -- that's how it works. We really get pushed back on that. To the extent, we do -- we just say no. So that's usually a fairly short conversation. Obviously, we do monitor how our customers are thinking about the local economies. Obviously, the more disposable income, the better. And I would have to say that at the moment, our customers, by and large, seem to be feeling pretty bullish about the situations actually. A number of them are rolling out significantly at the moment. We're also seeing, as Manjit mentioned in Tanzania, there's the new mobile operator that's come in. That seems to be catalyzing quite a lot of activity in the local market. in DRC that really is -- customers are racing to new areas of the country to acquire that incremental customer. So we are seeing pretty good competitive dynamics at the moment amongst our customers. And I think that the populations do seem to have more disposable income to buy that incremental SIM card, which is good. Our markets are as well largely unaffected by the sort of Ukraine, Russia situation and a few countries in Northern Africa are more impacted, but we're not operating in them. So again, economic sentiment seems reasonably good at the moment, I would say, in most of our key markets. In terms of the tenancy ratio growth, do we, therefore, bring in more smaller customers? So the answer is no. I mean, this is basically all predicated on major mobile operators. We do have a very small amount of revenue from small customers, typically, ISPs, Internet service providers and probably provide about 1% of our revenue. We don't anticipate that changing anytime soon, that will always be a tiny fraction of what we're assuming.

Yes. And actually, just to add on that, when we provide those stats around maximum single customer exposure, that's not in 1 market. That's actually in 3 or 4. So it's not that's the only person we have, say, in Tanzania, it's in DRC, Tanzania. So to Tom's point, you see that basically the same actors and the same blue chip customers in most of our markets. So it's not that we don't have the TowerCos for the Internet service providers that he's mentioned.

And just, Jerry, on your first question around the mobile operator kind of CapEx limitations or potential cuts. Yes. Look, the reality is that towers business does rely on mobile operators' CapEx budget that's for sure. So if a mobile operator cuts its CapEx budget to 0 one year, yes, probably we don't get many or any tenancies from them. Now to the extent we have 3 or 4 big MNOs in each market. That probably won't happen to all of them 1 year. I mean, for example, right now, we've got heavy activity from a few of our big customers, but 1 or 2 actually also do have quite a lot of CapEx cuts at the moment. So next year, maybe they'll get a big CapEx budget signed off. So look, it does come in fits and bursts. In some years through our history, we have had quiet years for all roll out and it's just so happened that all operators have sort of cut down in those years. But it certainly -- it doesn't happen on a prolonged basis. So usually, there's at least 1 or 2 who are rolling out every time so -- but we are realizing it to an extent.

[indiscernible] I have 3 quick questions actually, starting with the quickest 1 is you mentioned that structured capacity is 3, 4 tenants. Is it both the upgrade CapEx that you mentioned on the slides? Or that's going to come on top of that. Secondly, in terms of the concentration risk on the ground leases and especially for the new markets, is there any increase in that? Any exposure to state or kind of a larger concentration or remains to kind of the smaller lesser type of contracts? And then thirdly, in terms of the new technology that you mentioned like fiber and network as a service. In terms of your 2026 plan, how important is that? And proportion wise, where do you imagine you will get on these technologies?

Yes. No, great questions. Thanks very much. So look, on the capacity, the 3 to 4x, so on our existing portfolio, that is the -- that is what's available today. And on the new ones, which I think we estimate roughly around 3, that is post some upgrade CapEx, which we've got in our plan and was part of our acquisition sort of base case. So typically, after any acquisition, we will have an upgrade program, which is the same for all tower companies do it; American Tower, call it start-up CapEx. We call it upgrade CapEx, but that's the same thing as going around and making sure all the sites are health and safety compliance strong enough to take more tenants and in our case, have adequate power systems to run. So we're busy doing that at the moment, for example, in Senegal and started recently in Malawi and Madagascar, and we'll be doing that in Oman soon. On the ground lease concentration across our markets, we've got virtually 0 concentration. The only nuance to that will be in Oman, where quite a lot of the land under the exercises with the Ministry of Housing. But we see that as a very low risk, given the government very much wants the towers to be proliferated across the country. So -- but yes, I mean we're literally talking a landlord might own 1 or 2 or sort of 5 sites maximum, even that will be rare actually in most of our markets. Fiber and NAS. So look, in terms of our 2026 overall strategy, that doesn't play a huge part. And in fact, if we do that, that would be sort of incremental on top of our core plan, which is really focusing on towers and tower like adjacencies like in building solutions, outdoor DAS, smart solutions, all of which look and feel very much like towers from an operating perspective, an earnings quality perspective and a customer perspective. So that's very much our focus at the moment. But yes, we're having some interesting conversations on NAS at the moment, actually. So that could come into play at some point in the next couple of years. We'll see.

It's John Davis from [indiscernible] . Over the years, many of the MNOs have sort of chosen or being forced into having local partners and/or listings. Where do you stand on that philosophically obviously, not wanting you to comment on any particular country or more similar?

Yes. Look, I mean, we do sometimes have a local partner in South Africa, for example, more recently in Malawi. And we will look to have local partners if there's a benefit for us to do so. And we'll assess that whenever we enter a market. If it is a local requirement to do so, that will be a factor in whether we decide to go into that market or not. Most recently, it was Malawi, and there was a requirement in the towerco licenses to have a 20% local partner. We've actually partnered with Old Mutual, who have a fund in Malawi and that's classed as a local fund. So that's actually a very good partner to have. But in another market, we might look at it and think no, we don't like that local partner, so we won't go into that market. And that's actually been a factor in us deciding not to enter some markets over the years. So we'll always think about that. Local listings, again, I mean, pretty rare. There was a requirement in Tanzania for a few years. That actually then went away because it was just basically impossible and didn't make sense. And again, that would be a factor of consideration if we were going into a new market, if that was a requirement. But yes, it is quite rare for that to happen. So we'll take that as it comes. But we typically would not want to do a local listing in a local market.

Benjamin from Brizo. Could you talk a little bit about how your contracts are adjusted for -- when you have alternate energy sources being used on site? Are you able to sell back into the grid on any kind of semiregular basis? Are they still kind of being based on fuel indices? In terms of kind of planning your balance sheet and cash needs, how long does it typically take for an MNO to start considering selling towers to ultimately accepting bids? Do you have a lot of lead time? And then clearly, over time, part of the appeal of the story here is your capital allocation prowess or ability to get deals done on attractive terms. Could you, with some genericized examples, give an instance or 2 of when you passed as opposed to when you got it done?

Yes, absolutely, Manjit, do you want to...

So that's on the contract. Yes. So it's on the contract structure. So the way the contracts are currently structured is that it's very much based on fuel, electricity as it stands right now and how those macro movements move. So if we reduce the volume of fuel or reduce the amount of electricity you sizing from the grid, the pros and minuses to that will impact ourselves, but we're effectively structuring in some macro movements. So let me deploy things like battery, solar, that will effectively reduce the amount of fuel that we're utilizing and therefore, make that saving. And that's how the contract structures work. We don't yet look at items like electricity back to the grid. We're really utilizing it for our own power requirements, but may look at some of that in the future. So that's kind of how it works for all of our contracts.

Yes. Great. And then, yes, look, on the lead time for several leads back. Honestly, it depends on the operator, but anything from start to finish, probably the quickest that any mobile operator could do would be 18 months, and that would be really, really quick, anything up to 5 years plus on the sort of other end of it. But as a sort of rough rule of thumb a couple of years, so to the extent we're having a very early conversation today with 1 or 2 maybe that would mean in a couple of years that you actually see that come to fruition. So there is a relatively long lead time involved. Yes. Passing on M&A deals, yes. I mean, look, we passed on 6 or 7 in the last couple of years. In fact, 1 was about 2 weeks ago. I mean, the regions can range from the -- I mean it's usually around the quality of the contracts or the asset from one region to another. So for example, 1 quite big 1 in the sort of Southern African region that we passed on very early on last year was due to the MSA being full local currency, having very poor terms around amendment revenue kind of needing to give new space and power to the mobile operator for free, allowing active sharing to be done on the sites for free, which we'd never allow. We're either required to be paid for it or we just say a contractor can't be done, so then you have to have a negotiation at the time. To the assets themselves, not having much by way of capacity on needing a huge amount of -- I mean we always assume some upgrade is going to be needed, but sometimes it can be kind of huge. So yes, those sorts of reasons that sometimes we kind of get a little bit down the road in a deal. And once we've seen the contract, we sort of pull back. Other times, perhaps not just -- just not a strategic fit for us for whatever reason, maybe to your point, owner -- local ownership requirement. That was actually a reason that we pulled out of 1 about a year ago as well, yes, where we didn't like the local ownership requirements, and that was a big market in North Africa. So different reasons, but yes, we're quite picky.

Yes. I'll just add that we are very, very disciplined. We want to make sure that every dollar we put into the ground either be able to see OpEx item or new acquisition, we gain the best return that we possibly can. Now some may lead to more returns in the future such as acquisitions because your day 1 return is not going to be as good as colo, for example, but it will lead to more colos. And we look at it effectively on a traffic light perspective, but we'll put them all side by side and see which is the best utilization of capital and we disciplined about that.

[indiscernible] 2 questions from my side. One, are you seeing pressure from your customers to increase the amount of renewable energy in your power generation side of things as a way of getting their own scope to emissions down. And secondly, when we look at that Slide 49 protection against cost increases, it passes through, if you want an annual escalator, particularly for fuel. Is it the case that by the end of the year, you are kicked back up to where you would have been at the beginning of the year. But during the year, you are wearing the cost of that fuel. And so you're going to have a 12-month -- assuming that fuel goes up and it stays, you're going to have a 12-month loss and then a 12-month gain on the other side. And [indiscernible] world fuel prices keep going up, it's always going to be 12 months behind until final they come back down when you win.

So yes, simply, there will be a time lack. We have an annual escalator. So if there's movements outside where the escalation dates are, you all have to take on that cost, but you can go both ways, right? So you can go with cost prices go down, but also half of our contracts are quarterly. So it's not as though all of our contracts have that dynamic. So when you look at it on the blend, we typically have a good amount of protection against that. And that's really why we show that our squares because that does actually show from a U.S. dollar EBITDA perspective once you take into account revenue and your OpEx cost, how it really waters it way down and that barely has any correlation, which I think is really the proof to that.

Over a long period?

Every quarter.

Yes. And then, look, on the emissions point, yes, actually, we are having, I'd say, in the last 9 or 12 months, we're having more conversations with customers about joint projects around emissions reductions. So the big customers that we have, they have their own targets for carbon reduction. We're actually -- finding actually quite a good collaborating sort of subject. And actually -- it's actually probably, to some extent, brought us a bit closer together. We're also finding that it can be a USP because some other TowerCos maybe aren't as advanced as us at this whole sustainability angle, particularly around carbon planning, availability of data and stuff like that. So some of our big, big customers have asked us for reporting, for example, for all of their individual sites, exactly how much Co2 they're responsible for on a site-by-site basis, so literally thousands across their whole network. We can give that to them because our systems are actually pretty good and can get that out on an automated report every month. That's actually a massive tick in the box for the customer and actually probably a reason for them to do more business with us than perhaps someone else who can't do that. So we're definitely working in collaboration with them. And it's spurring conversations like us asking them what type of run refresh they're doing, what kind of new equipment they're buying because obviously, the new equipment can be highly power consumptive or not depending on which ones you buy, et cetera. So it's -- I suppose it's all the pressure across the whole industry is, I guess, doing what it's supposed to do, which is forcing everyone to talk together to find the most efficient solutions for power. Any more questions? Are we covered everything. Everyone's hungry and thirst. I think we've got some drinks on the terrace. It's hopefully not raining, so we can go out there. Great. All right. Well, look, if there's no more questions, we'll wrap it up there. But honestly, really massive thank you to everyone for coming. Great work all the presenters and the team involved in the preparation. And then, yes, thank you for everyone dedicating your afternoon to Helios Towers. We really appreciate it, and look forward to talking again soon.

Thank you very much.