MTN Group Limited (MTN) Earnings Call Transcript & Summary

Good day, ladies and gentlemen, and welcome to MTN Group's teleconference and update on recent group developments. [Operator Instructions]. Please note that this event is being recorded. I'd now like to hand the conference over to Mr. Thato.

Good afternoon to everybody. Welcome to the call, and thank you very much for joining us to discuss some of the recent group developments that you have seen over the past few weeks. There have been a number of corporate actions that you'd have seen over the past few months -- past few weeks that we've announced, and we thought it would be a good idea just for management to give a little bit of color and unpack some of these for you. So to that end, I've got Ralph Mupita, our CEO on the line; as well as Tsholofelo Molefe, who is our Group CFO. And between the 2 of them, they're going to discuss just a few of these issues that have been -- that have developed. So over the course of the next 45 minutes or so, they're going to speak to that, and I'll just hand over to Ralph to just run you through some of the topics that we have to discuss this afternoon. Thank you.

Thanks very much, Thato, and good afternoon to everybody on the call. Apologies for the late start. We do -- did have a bit of a technical hitch and I trust you forgive us. There's been quite a lot happening at the MTN Group, and we felt it important that -- to unpack and provide some color on some of these developments, as Thato's mentioned, quite a lot on the corporate activity side. So on this call, Tsholo and I will just basically run through 5 of these recent announcements. I'll hand over to Tsholo, who will first speak about the early redemption of the 2022 Eurobonds. And then she'll also touch on the second topic, which is the exit from Yemen that we announced today and give you a bit of color or just a reminder of the financial effects with the Yemen exit. I'll then come back to cover the third topic, which is the SA tower deal with IHS, which we announced yesterday. We gave a lot of color and detail in that. But we feel that this is a -- quite a transformative deal that we did yesterday that gives us a lot of flexibility over the next decade as we pursue our own growth in South Africa. And there were some elements of the deal that are atypical. And we read some of the sell-side broker notes, and we feel it's quite important to provide that color that this deal was actually one that we wanted and actually, we're very comfortable and happy with. And then I'll talk to the fourth issue, just a quick update on SA temporary spectrum, what's happened since the Q3 trading update. And then I'll give you a little bit of an update on MTN Nigeria, lots of questions around the PSB, AIP. And hopefully, I can give a bit of color around that. So let me hand over to Tsholo to speak to the first 2 issues. Tsholo, over to you.

Thank you very much, Ralph. Good afternoon to everybody, and thanks for joining us. I'll start with the early redemption of our 2022 Eurobond. You may recall that early in October, we did announce that we would be looking to do an early settlement of the 2022 Eurobonds with a principal amount of USD 500 million. We have been able to successfully do that, and it was redeemed for [ $513 million ], including accrued interest of about $5.8 million. This was really a critical step in progressing our medium-term target of deleveraging faster, particularly reducing the nonbad debt and optimizing our funding mix. So as at the end of September 2021, our holdco leverage was sitting at 1.2x. And on a pro forma basis because we obviously have reduced our cash and redeemed -- and we are still at around 1.2x from a holdco leverage perspective. With regards to our debt and mix ratio, we were sitting at about 47% to 53% in favor of [ EBITDA ] as at the end of September. And this has now shifted to 39% to 61% in terms of the debt mix ratio on a pro forma basis in favor of the EBITDA. And this is in line with our medium-term objectives. With regards to the exit of Yemen, we did make the announcement as we sent this morning and we effectively exited Yemen in an orderly manner from the 17th of November. And this was really done through a transfer of MTN shares to Emerald International Investment. Emerald is actually a subsidiary within the umbrella of Zubair Corporation. In turn, Zubair is the minority shareholder in MTN Yemen with a shareholding of 17.5% prior to this transfer. This is a demonstration of the continued progress that we are making in our strategic objective to exit the Middle East over the medium term, which we define as 3 to 5 years horizon. And it's really in line with our Ambition 2025 over pan-Africa, a forecast really, simplifying the portfolio to make sure that we reduce the risk in those markets. And if you recall, it also follows our exit of Syria which was effective around the 25th of February this year. And we will really continue to explore all available options for Afghanistan in line with the guidance that we have given previously. So as previously communicated, with respect to our associates in our investment in Irancell and nothing is currently under discussion at this stage with regards to that, and we will continue to keep you updated and as is necessary. On Yemen, you would recall that we fully impact the consolidated net assets as at the 30 of June 2021. There is therefore no further material impact that we expect on our earnings apart for an immaterial potential gain on disposal as a result of recycling the foreign currency translation results that this would really be immaterial. We can also update you that following this agreement, MTN has no past, present or future liabilities in relation to the assets -- the Yemen assets whether in respect of our past shareholding in MTN Yemen or the entity's future operations. It is important at this point, really as a final point on Yemen, to just really thank the 719 employees of MTN Yemen and its leadership, who really dedicated their time, and really thank them for their commitment and the work that they have done to serve our customers under the MTN Yemen over the years. And we really would like to wish them all the best in the next phase of the development of the business, along with the new shareholder, Emerald. At this stage, I'd like to hand over to Ralph, and thank you very much to everyone.

Yes. Thanks, Tsholo, for providing that context and providing particularly the financial frame and implications of -- for Yemen exit. And as you said, no past or future liabilities was part of the deal with Zubair and the new shareholder, Emerald. So that extinguishes any possible claims or risks. So again, improving the risk profile of the group going forward. Let me jump straight through topic number 3, which is the SA tower transaction, which we have famously, for the last 12 months, spoken about as needing to be Opco friendly and that the cash proceeds are a derivative of the Opco-friendly deal, essentially wanting to ensure that it gives us the operational flexibility as technology evolves over the next while, and we've really factored in already 4G, 5G and any future technologies. The financial shape of the deal should look to keep MTN SA as cash flow neutral as possible because we wanted to ensure that the upstreaming from SA continues to be substantially the same pre and post the deal. And I think that was a very important aspect of the deal, which I think at current time is underappreciated, which is that we wanted to make sure that it had sustainability factors. The one is the BEE side. And we want to make sure that a transaction of this nature ensures that we remain at our premium BEE level, which allows us, actually quite importantly, to be able to be more competitive on the enterprise side. And you guys have seen how we've made progress sequential quarters. On enterprise, I think our BEE rating is quite important in that domain. And then finally, the other aspect is really around sustainability. We're all getting to grips with greenhouse gas emissions. And I think one of the things that's a signature to this deal, that within the NLA, we're able to bring in our own Scope 3 targets for decarbonization built in with the right structure around ensuring that South Africa, which today or at the end of last year, generated 25% of MTN greenhouse gas emissions that's all factored in. So just some [ sailing points ], to be clear again, it's 5,700 towers to IHS, and this has followed a very lengthy and competitive process. The long list, you can imagine, that should have had the typical names here. And the short list, you can well imagine that we've got IHS against other international firms there. 4,000 of these are greenfield. The balance are rooftops. And there's been an agreement in place for IHS to provide power as a service across the entire MTN SA footprint of 12,800 sites. I want to reemphasize, it's a part -- the 5,700 is obviously a part of the portfolio, not the entire. The offer value of [ ZAR 6.4 billion ] and it has an agreement for initial tenure with an option to renew for a further 10, so that's quite typical in that particular structure. We've also been quite clear, as I mentioned, that we wanted to make sure that this is an Opco-friendly deal. 4,000, as I mentioned, of the towers are greenfield, and we retained another 2,000 barter sites, which would usually transfer in a transaction of this nature. We reviewed the proceeds that were available for a barter deal. We turned it down. We could have had higher proceeds, but that didn't make financial sense for us. So MTN SA will thus preserve the annuity cash flow and the economic value of these 2,000 towers, and I think that's important. Yes, as I mentioned earlier on, we've secured these lease terms that ensure a cash flow neutral outcome from MTN SA. We're talking about the OpEx and CapEx that it takes to run the operation. Thato yesterday shared with me the list of investor questions, about 12 of them, 10 we can't answer, but 2, we certainly can. And one of the questions was, are your margin expectations going to be different? We have guided for a corridor of 39 to 42. And we're quite clear in structuring this deal that we wanted to be able to maintain that kind of medium-term margin guidance. So -- and that works well with the kind of cash flow neutrality that we were seeking from such a deal. I mean due to the nature of the technicalities around lease accounting and the movement in CapEx and OpEx as a result, there will be some slight margin dilution, but it doesn't change the frame of our 39 to 42. Over and above the satisfactory lease rates, that we've got in this contract, I think we got a level of flexibility secured in this agreement that is probably atypical, as I mentioned for both current and future technologies. And as many of you will all know that SA market as a particular kind of structural configuration. Vodacom is a fully invested network with its own towers, but also there's national roaming. We do the same. We then have Telkom, which has some of its own towers, but also roams and our Vodacom and on MTN and Cell C, which is decommissioning. And I think if you consider the fact that this deal is incorporating all of Cell C and Telkom roaming and you kind of look at the market structure, I think, again, it's very clear that this deal was very supportive long-term to enable national roaming and active sharing in the future. The other point that I would raise, I mean, this deal is a local currency deal. We've learned quite a lot as MTN about dollar indexation to transactions. So we really had vigorous discussions. And I think without saying too much, 1 or 2 international bidders, they left the process because of this. We thought that this was quite sacrosanct to mitigate against FX risk within MTN SA. So I think getting the local currency was quite critical for us. As I mentioned, the BEE was an important consideration. I mean we haven't driven or dictated to IHS exactly. What we simply said is that we need to comply with local ICT sector regulations about BEE. And they will communicate at their time and on their basis any color on the 30%, but we're clear that it needed to be maintained during the 10-year contract. And we have clauses there about how to remedy breaches because it does then impact also on our overall BEE rating. And it's also just the right thing to do. And quite importantly, as I mentioned, we've also got clause and provisions there about Scope 3 emissions. As I said, South Africa is 25%. [ If we don't make progress in South Africa, 25% in Nigeria is 38%. ] But let's just focus on South Africa. This is quite an important part of the deal, and we had very robust negotiations. And the fact that we have a clause that's in the MLA as opposed to a side letter, I think, has been an excellent achievement. So hopefully, that gives you guys a bit more color about what we mean by Opco-friendly deal. The proceeds would not be as you guys would typically expect from traditional or more typical to our transactions, but we wanted to get the operational flexibility, power management in, number one. The financial frame needed to be as cash flow neutral, allow us to keep the margin. And Tsholo and I were very focused on the fact that South Africa plays an anchor role in the upstreaming to the group. We don't want to deal that impairs that, and that's why the barter sites, we rejected the pricing around that. And then the sustainability issue is really around BEE. And the big issue, which I think we'll talk more about, is just how you manage greenhouse gas emissions over time. So we think we have got a really good deal, and I'm sure IHS also believe that they've got a really good deal. Moving on, topic #4 that's been exercising our mind is being engaged with the authorities around the temporary spectrum, which now from the 27th will be framed as provisional spectrum pursuant to a process, which is currently viewed as an auction. But we are hoping that the authorities are a bit more flexible and consider other processes. So the deadline, we are now in that process. We think that this has been a good outcome that -- and [ we thank ICASA ] for being open and engaging. And I think now we are all in process to submit our own applications. And once those are allocated to various bands, then there is this process to have a hard stop by the end of June 2022 or 3 months thereafter, which -- 3 months after the end of the national state of disaster, whichever comes first of the 2. There's been communication by the Minister of Finance in the medium-term budget statement that would like this all done as soon as possible. So I think there is support all around to try and get a solution. As I mentioned, the current process thinking is an auction. If this assignment -- this specific process works well, we deal with the issues that have been raised by [ ETV ], raise the issues. And we can all find each other. I think it will be a good footing going into December and [ listening to the early year ]. And then whichever process gets spectrum permanently allocated, we support either an auction or an assignment process. The final topic that I really wanted to just cover is really the development around the PSB, AIP. Many of you have been giving us a hard time. When is the PSB, AIP actually going to come through? And it came the day after our Q3 trading update. So we are very pleased to have secured an approval in principle for a license application for the MoMo Payment Service Bank, and you guys would have seen us communicating that through SENS. The AIP essentially means that we have a 6-month period to fulfill certain conditions stipulated by the Central Bank of Nigeria before they decide on a final approval. So yes, this all has to be done within 6 months. As you can well imagine, we're working flat out of this and making sure that all the requirements are provided timeously. And -- but for now, nothing really changes. But fortunately, for us, we've been on the super-agent license since 2019. And as we said previously, the super-agent license at least allows us to get our -- the agent network kind of primed for the PSB. We have 630,000 strong agents who are credited for the super-agent license. And obviously, the products will be different, but they're now pretty used to taking naira and kind of in a -- to a normal type proposition. So we'd like to believe that, that gives us a little bit of an advantage. Maybe it doesn't ultimately, but we think that the last 2 years with -- since 2019 of having that super-agent license would not have been wasted. So it enables us to do a lot of groundwork. And yes, so somewhere between Q1, but no later than Q2, we would anticipate that we're going to come back to the market, that we have the final approval and we'll be able to launch. I mean this PSB, to just remind everybody, will allow us to offer the service of the traditional mobile money operator. So similar to other markets, while it's saving cash and cash out, inbound, international remittances, et cetera, that, that's all in frame. And importantly, as we said before, the difference is that PSB is a bank, and so you can hold and manage the float and that's quite differentiated from traditional mobile money operators, who generally are not permitted to hold their own floats and required to appoint a principal bank to carry out this function, we will be the principal bank in of itself. So we are quite excited about this and arranging ourselves. But obviously, kind of staying with our feet on terra firma and working through the AIP process. So hopefully, this has provided you guys with much color. I think what you can, for sure, not say about this management team is that we are lazy and we -- that we've been very, very busy in the last couple of months. And as Tsholo mentioned, I mean, one of the things that we would like to complete, the whole thing is working well, is Afghanistan. And so that we end the year with the previously consolidated subs in the Middle East, out of the portfolio, we simplified the portfolio. As Tsholo's mentioned, nothing on the cards with Iran. And we were recently in Iran for the first time in 2 years, managed to see the Snapp business in operation. And obviously, they're challenging sanctions regime in place now, and hopefully, the talks go well. But what I can say to you without fear of contradiction is that in a normal environment, the Snapp business wouldn't look any different from Grab or Uber. They have 2.8 million rides. They've got all the verticals that you'd see with the Grab. Yes. So inshallah, we hope that the discussions happen constructively, so that there's also a value reveal in that Irancell business and the Snapp business. It's not -- this is not a part of the business that is similar to the other 3 previously consolidated Middle East markets. In the right geopolitical context, I think there is quite a lot of value there. So that will -- I think I've taken a lot of time and again, apologize to our investors for the technical glitch. And maybe we'll take a few questions. Thanks very much.

Thank you, Ralph and Tsholo, for that overview. I trust that, that was useful to all our investors and analysts. I'll just hand over to the operator to just facilitate Q&A. Again, apologies for the delay in starting, but we'll give it another 15 or so minutes of Q&A. We do have a hard stop. Thank you.

[Operator Instructions] The first question comes [ from the line of John Kim from UBS ].

Three unrelated questions. Firstly, on Yemen. The transfer of ownership, there's no purchase consideration around that, just to clarify, question mark. On the towers, can you expand a bit on the 2,000 sites that are to be bartered? Was the issue that you weren't going to realize fair value on an offer? What exactly would you be bartering them for? And then finally, ownership of the remaining 1,000 sites -- remaining 7,000 sites that you used in South Africa, do they belong to you? Are they a third-party owned and operated base?

Okay. 3 -- John, you said 3 unrelated questions, I think there's some -- so on Yemen, we passed on our shares for 1 AED/dirham to the minority. I mean it's a -- and I think the important thing is we've extinguished any potential -- any past or potential liabilities that, that was quite a key consideration as part of the derisking. I mean there was a 2G license coming up by the end of the year. And we applied our mines. [ We do want to invest further in the market. We don't have any appetite around that. ] So as Tsholo said, the financial effects were already taken at the half year, so there's a de minimis positive outcome that comes to the P&L for full year. But yes, we spoke to them about the importance of just making sure that they are responsible for anything that could come out historic or into the future, and we were comfortable with that. Yemen -- the 2G network, as we said, the country has been under war for a very long time, and it's been quite a difficult operating environment for us and [ invest ] our management efforts and -- or to the rest of the portfolio. Yes. On the 2,000, for us, it's about fair valuation. And we looked at it, and we run our own numbers, and we said from what was presented by -- or shortlisted, it didn't make any financial sense and we keep that optionality for the future. So it was a fair valuation point looking at the shortlisted bids. And the 7,000, as we say, these are barter stocks between ourselves and then largely, Vodacom. So yes, that's the balance of the numbers for the full 12,800. Tsholo, I don't know if there's anything you want to top up on, on Yemen?

No, Ralph, I think you've covered it.

The next question comes from [ Preshendran Odayar with Nedbank ].

Presh, do you want to go ahead?

Oh, yes. [Indiscernible] operation. But firstly, congratulations on all the announcements. Ralph, we definitely don't think you guys have been sleeping. I think since you guys have taken over, you've been moving ahead with your -- all of the ambitions that you guys have had, faster than your 5G data speed, so well done on that. I've got some questions mainly around your SA tower deal. Obviously, the amount you sold, it seemed a bit low than what a lot of us were looking for. But you have articulated that there are some favorable -- what sounds like some favorable lease costs going forward. You've obviously included power as a service, so -- and there's also a BEE component. I don't know if you can give us a little bit more color on, firstly, what is the, call it, discount on market-related leases that you've negotiated. And then on power as a service, I would assume that prior to this, each network operator has to maintain their own backup service or backup power service on their sites, including co-located sites. And what did that cost MTN South Africa before the [ tower ] you went through? And lastly, the 30% BEE shareholding, is there some cost involved for a BEE deal within this transaction?

Presh, you asked me all the questions that Thato sent me yesterday [indiscernible]. These are the -- market sensitive. I mean, look -- I mean, the -- one is, obviously, the lease rates, we bargain hard, and there is a discount to what you might see as market just for the size of this transaction. But obviously, that's all kind of quite commercially and competitor sensitive and can create other issues if we were to communicate that. Yes. And as I said previously, the power management would be an operator by operator. But I think the one thing that's striking us, particularly in a market like South Africa where you have these rolling blackouts. I'm not even sure right now if we're in load shedding Stage 2. It's quite a job to manage that. And we've now built-in SLAs that deal with kind of power management, kind of normal operating environment. And what happens when we get to Stage 5, which is almost kind of a force majeure-type stage. And we still want to maintain the #1 network status. So somebody like Giovanni, our CTO in South Africa, and Godfrey himself, we do want to ensure that we remain competitive and actually power and availability is going to pay a very important role, and we modeled what we think is the right kind of SLA and penalties, power management with -- in normal situations as well as in load shedding at the various stages. So we've been very meticulous around that. On the 30% BEE, it's not -- we don't know. It may well have cost something. But as I said, the -- you got to look at this thing completely [ in the round ]. And that's why I say this Opco-friendly deal, which is probably atypical and you guys look at these things and you look at Nigeria, what -- some things that are in Europe. I look at it and I say, "Well, okay, and maybe power company X and Y costed this thing somewhat into the proceeds. But actually, over the long term, if I can keep my enterprise business competitive and grow my revenue contribution from enterprise towards 25%, that's actually a win." And as we always said, the reality of this SA tower deal was not a monetization. The monetization was a derivative of ensuring that we can remain competitively -- we can remain competitive in an environment where there's technology change as well as we are being responsive. So maybe there's a cost to it, we don't know, they don't tell us that. But our assumption is the BEE partners can run to investment banks. And this is a bankable deal and they can get their own funding for this, but we don't know that stuff. And we've been very clear. We want to stay away from that, [ their BEE partners ]. We just want to ensure that they comply. They can remedy breaches. And we don't want to be embarrassed by partners, et cetera, which can then have a contagion. So if you say that there is a cost there, I don't know what it is. But as I said, for particularly our enterprise business, losing our premium status, I think, makes us -- is an issue that is part of kind of our competitive arsenal. So unfortunately, Presh, I couldn't answer those questions more directly.

The next question comes from Jonathan [Technical Difficulty].

Jonathan, please go ahead. I think we've got an issue with the operator [indiscernible].

I just wanted to ask on the power as a service contracts. How -- just out of interest, across your network, how much downtime is there on average where Eskom is not supplying power? So say, 5% of the time? 10% of the time? And how do you expect that to evolve? And are these contracts structured such that diesel would be passed through as a cost to the business? And would the CapEx that's required to be put down at site to create the backup and the formal generators, would that be passed on or is that IHS' -- for their tab?

Yes, Jonathan, let me have a go there. I don't have the number absolutely at hand here. But I remember 97.5% is generally where we go down to on availability. But I'll just ask Thato to just check or -- check. And Tsholo, if you want -- if you remember that number better than me. Diesel, these are not passed through to us. I mean that's why we said that -- because power as a service upgrades -- I think, the thing that we've seen is when you offer power as a service, you've got to anticipate all likely outcomes and price demand. So there is no additional diesel cost that comes to us through this. And your second question on power, I've written it down, but I can't read my own handwriting here. So what was Jonathan's question? Just -- your second question on power? The first one was pass-through on diesel. The second one?

What is the downtime that has been negotiated? And I think probably, if I'm not mistaken, Ralph addressed it in the first question that, I think, Preshen asked because it's essentially up to Stage 5 load shedding. And I think if you remember those load shedding schedules, Stage 4 is essentially about 4 hours. So I think it's covered up to that Stage 5. And I'm not sure if that's the question. But essentially, the downturn that is covered is essentially up to Stage 5, yes. And I think you're right, Ralph. I was also [ just wrong ]. I think it's over 90%. I think it's about 97.5%, you're correct. But I'm just trying to also check. We can come back to you on the exact number.

Yes. I just remember the 97 as a -- on the availability side. But we'll check and get back to you. That I can -- that we can possibly [ do ].

And just the follow-up on CapEx. If Eskom becomes less reliable, the CapEx for generators to be installed more widely, who bears that cost?

It's IHS' cost.

It's IHS' cost.

Yes. And in fact, one of the benefits was that when we looked at it from a financial impact perspective for MTN SA, we do expect that the CapEx as a percentage of revenue would obviously reduce as a result over time because they now, obviously, can bear the cost of CapEx. So we don't expect any pass-through as much, yes, to us.

Yes. Jonathan, I mean, your series of questions are -- hopefully, are illuminating investors around this -- what we call the atypical structure, the Opco-friendly deal. As we're saying, if you're doing power as a service, manage power as a service. Let's develop SLAs that envisage kind of normal conditions around even load shedding all the way up to level 5. But any additional costs related to that, you must bear. And there are penalties, and we don't put a cap to the penalties. So we haggled a lot on the cap because why should we put a cap? Power as a service is something that global tower companies are really getting to understand. And then on level 5, I mean, the one thing that we can say, that we've agreed to kind of baseline kind of the period, let's call it 6 months, where we studied because the pattern of the load shedding, whether you have 1 hour down every day or you have 3 days and then you're back online, they have different permutations. So at the level 5 through baseline. And what we've agreed at the level 5 is that we'll get a level of improvement the -- above that baseline of the Stage 5. But it's power as a service. It's a service. We need the SLA. And then whatever penalty is coming with the SLA, those will be [ effected ].

The next question comes from Rohit Agarwal for Kepler Partners.

Bloomberg talked about a potential deal with Telkom in South Africa. And I'm not -- I don't want to speculate on this, but I just want to understand if strategically that is something that the company would be interested or pursue if it makes sense. And any thoughts there would be appreciated. And the second question was, I believe you talked about potential return of capital, perhaps in relation to the divestment program. And I just wondered where that fits in today given all of these changes that you discussed.

Yes, maybe I can touch on those. And the second one, that Tsholo can top and tail on that. Look, I mean there's always market speculation on consolidation. I think there's a decade-long run around MTN and Telkom. I mean -- I think we can say that if you look at the structure of markets, not just in South Africa -- and we try and have these discussions with the authorities. And I guess it's a mindset view around investment versus competition. And you basically can say the U.S. market versus, let's say, Europe. It's 2 very different point of view. For a capital-intensive business such as the one we're in, you -- I mean -- I think you can make a very reasonable argument that says market consolidation is needed. And I think a good view of the market consolidation is this national roaming arrangements we have because it's not possible for everybody to invest in their own infrastructure and [ be a fully vested ] operator and generate sufficient returns. There -- so that's because we've got 2 well-invested networks or fully invested networks that can carry others. Telkom is a hybrid. And then Cell C is on plan to dismantle its own infrastructure, at least the rand side of it over time. So -- I mean it's a philosophical discussion we're now having. Is market consolidation needed over time? I would argue yes, into that market consolidation. How long is time? I don't know, but the market structure right now is not -- is -- over the medium to longer term, it doesn't -- will not generate the right kind of returns for investors above the cost of capital. On the return of capital, I think the thing that we have said consistently and Tsholo will back me up is that the thing we've spoken about is we're committed to [ $2.50 per share ], and we'll apply our mines in February, March next year on that number or anything above that number. I think you can well anticipate, subject to Board discussion, that we'll remain on track to meeting our promise. If we felt confident that we couldn't meet that promise of at least $2.60, I think we have communicated something. But what that number ultimately is, is a Board decision before full year results are presented in March next year. Tsholo, do you want to top and tail on that?

Yes, Ralph, I think importantly, the return to -- return of capital to shareholders still remains a key consideration within our capital allocation framework. I think we -- just to indicate that with regards to the use of proceeds that -- from the -- this tower transaction, we've always said that we want to use the proceeds firstly for acquisition of spectrum, which we believe is likely to happen next year in SA. And from a capital allocation perspective, we obviously want to see what other areas of investments that we want to make in that [ playing ] order, we're continuing with our deleveraging. So any additional cash that we have, we will obviously, in line with Board decision, look to return to shareholders if [indiscernible].

The next question comes from Nadim Mohamed from SBG Securities.

[Indiscernible] on the progress you've made in the end. Two questions from my side. One is on the PSB license. My understanding is that there are certain guidelines in terms of pricing for most of your services there. I think most -- I think [indiscernible] in terms of price [ levels. So I'll get a sense that -- what ] do you think of that pricing regime? Is it -- do you think it's allowed to achieve the same kind of profitability as you've achieved in other MTN markets? And then secondly, if I may, I saw yesterday, you announced you took 1.75% levy on electronic transactions in Ghana. Just if you could share some thoughts on that and how it can affect [indiscernible].

Yes, maybe I can take those 2 questions up. I think, probably, if investors will forgive us, so we have to run just now. Look, I mean, yes, you're right. I mean the guidelines for the PSB license, as any license regime in a particular guideline, we're pretty comfortable with those guidelines that those will generate the right kind of return profile. So there's nothing for us to be particularly concerned about. But we're not jumping to the next step quite yet. But I think once we get through the AIP groups, inshallah we get through that. I mean we will then talk to you guys more about kind of what to expect over time. So I think if you can just be patient with us on that. And yes, the Minister of Finance in Ghana yesterday spoke about a levy, 1.75% over 100 [ cities ], but still going to discussion and debate, and we'll see. We're busy modeling that to see what's the impact on that. I think what we have seen, for sure, in 2 markets, and you guys study these markets as much as we do, you look at Uganda, what then happened, and then also, I guess, Tanzania may be another data point, was that there's a certain category of mobile money where it actually does have an impact. And I think we've seen, certainly in one of those markets, we'll only mention what you guys know, where they reversed that. And I guess if you thought about this, I don't think it's been super specific on whether this is kind of on cash in or cash out. I guess if it is on cash out, the impact would be manageable. But let's not run to conclusion. We're still modeling this and -- to see what that impact is. And then if there is anything, for sure, we'll come back to you. It's very early days, less than 24 hours since that was released.

Thank you very much. So Thato, can I perhaps hand to you to conclude, sir?

Yes. Thanks very much, [ Victoria ]. And thanks, everyone, for dialing in. If you do have follow-up questions, please do pop me an e-mail, and we'll sort you out. Thank you very much.

Thank you. Thank you again.

Thank you.

Ladies and gentlemen, this concludes today's conference. Thank you for joining us. You may now disconnect your lines.