Millicom talked up the success of its business transformation and investment in data infrastructure across Latin America, as net profit from its continuing operations jumped 65 per cent year-on-year in the first quarter.
CEO Mauricio Ramos (pictured) said the company was now experiencing more predictable revenue patterns and steady growth as the result of a three year programme to transform the business.
During Q1 2018, Millicom focused on deploying infrastructure to support high-speed data networks across its footprint in Latin America – a region which contributes over 90 per cent of group revenue – and reorganised or disposed of a number of assets.
The company, which operates in Latin America and Africa, reported net profit of $87 million from continuing operations in Q1 2018 compared with $53 million in the same period of 2017. Revenue grew 4 per cent year-on-year to $1.5 billion.
Including the impact of discontinued units, profit fell 27.9 per cent year-on-year to $17 million.
Divestments made since Millicom unveiled its new strategy include its Tigo Rwanda business, sold to Bharti Airtel, and a number of agreements with investment companies to sell and lease back towers in some of its Latin American markets. Its Ghana business was reclassified as a JV with Bharti Airtel, and Tigo Senegal is currently being sold to a consortium.
Hailing the impact of the turnaround strategy, Ramos said: “We are now beginning to reap benefits in the form of faster and more predictable revenue growth, improved cash flow and returns, and a stronger balance sheet.”
He added the company reported steady increases in its mobile business across its footprint alongside “record growth” in its home broadband divisions.
The company began reviewing its business in response to a decline in earnings from traditional voice and SMS services, and came amid a turbulent period of sharp foreign exchange movements in several of its markets. Millicom was still reporting sporadic quarterly losses as recently as Q2 2017.
Meanwhile, in a separate statement the company confirmed it will face no action following a US Department of Justice investigation into potential “improper payments” made on behalf of the company’s JV in Guatemala
The DoJ closed the probe, which began Millicom voluntarily reported the matter in October 2015.