Naira devaluation lowers IHS revenue to $258.9m

IHS Holding Limited, the telecom infrastructure company managing towers for MTN and Airtel, reported a 19.3 per cent year-on-year drop in fourth-quarter revenue to $258.9m, citing the sharp devaluation of the naira and revised contract terms with MTN Nigeria as key factors.

The company disclosed its financial results for the fourth quarter and full year ended December 31, 2024, in a report obtained on Thursday.

It stated that while revenue grew by 6.8 per cent quarter-on-quarter, the sharp depreciation of the naira significantly eroded its dollar-denominated earnings.

“Fourth quarter revenue decreased 19.3 per cent year-on-year to $258.9m, primarily driven by devaluation of the naira versus the US dollar,” the company said in the report.

It added that organic revenue growth of $197.2m was fuelled by foreign exchange resets, diesel price adjustments, and increased revenue from colocation and lease amendments. However, “the positive impact was offset by new financial terms in its renewed contracts with MTN Nigeria, which were signed in the third quarter of 2024.”

The naira, which averaged N1,629 per U.S. dollar in Q4 2024, was nearly double the N815 recorded in Q4 2023. This steep decline led to a non-core revenue reduction of $259m, or 80.8 per cent year-on-year, according to the report.

IHS Towers, which operates 39,229 towers across six African and two Latin American markets, also reported a decline in adjusted earnings before interest, taxes, depreciation, and amortisation due to currency depreciation.

The company noted that while cost reductions—such as lower diesel, maintenance, and security expenses—helped mitigate some of the revenue loss, these savings were largely nominal in dollar terms, as underlying costs in naira continued to rise.

Additionally, IHS Towers stated that its revenue was impacted by the renegotiated MTN Nigeria contract, which resulted in a lower revenue contribution from its largest customer.

Despite these challenges, Chairman and Chief Executive Officer Sam Darwish remained optimistic about future growth.

“We believe we are well placed to leverage our market-leading positions and support growing demand for our critical communications infrastructure, with growth underpinned by continued 5G deployment across our markets and an improving backdrop within our largest market, Nigeria, after recent carrier tariff rate increases,” he said.

Darwish added that the company remains focused on enhancing profitability and cash flow in 2025 while exploring selective asset disposals to strengthen its balance sheet and deliver value to stakeholders.