Millicom International Cellular: Millicom Confirms Ambitious $9bn Revenue Target and Reveals New Services
September 24 2014 - 9:40AM
Business Wire
Millicom (NASDAQ:MICC)(STO:MIC), the international
telecommunications and media company, confirms today its ambitious
target of reaching over $9bn revenue in 2017 as its rapid
transformation into a diversified digital lifestyle company
continues.
The company also gave an update on its performance since the
2013 Capital Markets Day and announced new services to reinforce
the shift to consuming mobile data.
Delivery and Transformation
The company highlighted the overall 9% revenue yearly growth
rate (in local currency) with its mobile business advancing 6%,
cable rising by 16% and mobile financial services up 41%.
In mobile, Millicom’s shift to data continued with 23% of its
users now using data services compared to 17% a year ago.
Over the past year rapid progress was made in executing the
strategy to become a digital lifestyle company offering a growing
range of services. Initiatives during this period have
included:
· Bundling, data and smartphones: entry-level smartphones now
widely affordable, fixed and mobile bundling of services, free
Facebook data including in two indigenous local languages, FIFA
World Cup application amongst the top five downloads in Tigo
countries, Tigo Music the number one music distributor in
Colombia;
· Digital and Home: DTH satellite pay-TV launched in five
countries, two new Tigo Sports TV channels in Paraguay and
Bolivia;
· MFS: mobile money now available in eleven markets, a return
being earned on mobile money accounts in Tanzania.
Two new initiatives in Digital Music in Africa
The company has announced today the launch of Tigo Music in
Africa in the next quarter as well as a partnership with Africori
to fund, acquire and manage music rights through a new venture
called “Africa Music Rights”.
The merger with UNE: the potential
Millicom completed the merger between its local Tigo operation
with the fixed-line company UNE in Colombia last month.
The highly complementary nature of the services and footprint of
each organisation will create a strong and competitive integrated
digital company. We believe the combination of the two businesses
will enable Millicom to become the leading telecoms digital
lifestyle player in Colombia.
Today’s update, subject to review, highlights UNE’s solid
revenue growth rate, its high quality infrastructure backed by a
strong investment phase.
In 2014 Millicom expects the contribution from UNE to the
consolidated numbers to reach $550m of revenues, an EBITDA in the
region of $120m (before integration costs) and a capex
approximating $120m.
Millicom confirms its initial stance on synergies which should
exceed a net present value of $600m (including integration costs)
over time. More details on synergies will be announced early next
year following the completion of the integration planning
phase.
The challenges and opportunities ahead
The company outlined challenges to the execution of its
strategy. These include managing competitive pricing, foreign
exchange and regulatory pressure; guaranteeing the monetization of
data services; offering a mobile money service tailored to local
conditions; developing relevant data services and successful
implementation of cost efficiency measures.
The update centred on the major opportunity ahead to advance
rapidly to the projected $9bn revenue target as the company’s
profile changes with the execution of the UNE merger, the take-up
of Tigo Star and driving increased revenue per user with compelling
digital services and customer retention.
Speaking at the Capital Markets Day event in Miami today,
Hans-Holger Albrecht, Millicom’s CEO and President, said “The goals
we set out are clear and ambitious. We began to convert the company
into a digital lifestyle provider last year and now, with talented
global and local teams, we are committed to the rapid
implementation of this plan. So Millicom’s growth and
transformation is well on track and we look forward with confidence
to continued progress in the coming years”.
Tim Pennington, Millicom’s CFO, highlighted today the company’s
financial priorities, commenting “Our digital lifestyle strategy
provides us with a significant revenue growth opportunity and, by
reaffirming our ambitions for EBITDA and capex margins, we are
committing to deliver profit and cashflow growth as well. Our
business is evolving so we are taking action to ensure we remain
efficient and increase return on capital. Having completed the UNE
deal, we will also have a period of focusing on debt
deleveraging.”
For more please visit: www.millicom.com
About Millicom
Millicom is a leading international telecommunications and media
company dedicated to emerging markets in Latin America and Africa.
Millicom sets the pace when it comes to providing digital lifestyle
services to the world’s emerging markets, giving access to the
world, primarily through mobile devices. Operating in fourteen
countries, primarily using the Tigo brand, Millicom offers
innovative and customer-centric products. Millicom employs more
than 10,000 people and provides mobile, cable, broadband, TV
content, online and financial services to over 50 million
customers. Founded in 1990, Millicom is headquartered in Luxembourg
and listed on NASDAQ OMX Stockholm under the symbol MIC. In 2013
Millicom generated revenue of $5.16 billion and EBITDA of $1.9
billion.
This information was brought to you by Cision
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MillicomPress Enquiries:Julian Eccles, VP, Corporate
Communications+ 44 7720 409374press@millicom.comorInvestor
Enquiries:Nicolas Didio, Director of Investor Relations+44 203 249
2220investors@millicom.com
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