IHS Holding Ltd is shrinking its tower footprint and extracting more cash from remaining assets as it positions for a planned $6.2 billion sale to MTN Group, according to a statement issued with its full year 2025 results on March 18, 2026.
The Africa focused tower operator reported modest top line growth but weaker underlying momentum, signalling a shift from expansion to cash optimisation. Revenue from continuing operations rose 3.6 percent to $1.58 billion in 2025, while growth slowed to 1.2 percent in the fourth quarter. On an organic basis, which strips out currency effects, revenue declined in the final quarter, pointing to softer demand across key markets.
Net income swung to a profit of $126.8 million from a loss of $1.64 billion a year earlier. The improvement was driven largely by reduced foreign exchange losses and lower financing costs rather than a broad-based recovery in operating performance. That distinction matters because it ties the rebound to macro factors, particularly currency movements in Nigeria, rather than a sustained increase in tower demand.
Operational data shows a company retrenching. The total number of towers fell to about 37,600, down by more than 1,600 year on year. Tenants declined by over 4,400, reflecting both asset sales and customer churn. The drop includes the exit of tenancies linked to contract changes and disposals in markets such as Rwanda.
At the same time, IHS increased lease amendments, which capture upgrades and additional equipment on existing towers. The shift indicates a focus on sweating assets rather than building new sites. Even so, the colocation ratio, a key efficiency metric that measures how many tenants share each tower, edged lower, suggesting that gains from upgrades are not fully offsetting tenant losses.
Cash generation strengthened over the full year. Operating cash flow rose 27 percent to $983 million, while free cash flow climbed 47 percent to $448 million. The improvement reflects tighter cost control, lower interest expense and a pullback in capital spending.
Quarterly trends, however, point to emerging pressure. Fourth quarter operating cash flow fell by more than a quarter and free cash flow declined about 19 percent, as interest payments rose and spending on site maintenance increased. The pattern suggests that while the annual numbers are strong, momentum weakened into year end.
Capital expenditure declined for the year, reinforcing the shift away from expansion. Investment is increasingly directed toward maintaining and upgrading existing infrastructure rather than adding new towers. That aligns with a broader strategy to streamline the portfolio and prioritise returns.
Currency effects played a central role in the reported performance. Foreign exchange gains added tens of millions of dollars to revenue and earnings, offsetting what would otherwise have been weaker underlying results. Nigeria, IHS’s largest market, accounted for a significant share of those gains, increasing the company’s exposure to currency volatility.
In the fourth quarter alone, foreign exchange effects lifted revenue by nearly 10 percent, masking a drop in organic revenue. Without that support, the slowdown in demand would have been more visible in headline figures.
Outside Nigeria, performance was mixed. Revenue in other Sub-Saharan African markets grew modestly, but profitability declined as higher energy costs and regulatory pressures weighed on margins. Diesel prices remain a key cost driver for tower operators that rely on generators to power sites, adding volatility to operating expenses.
IHS has exited the Middle East and North Africa region and continues to narrow its geographic focus to markets with stronger long-term returns. The disposals are part of a wider effort to simplify the business ahead of the MTN transaction.
The balance sheet has also improved. Total borrowings declined and leverage fell to 3.1 times earnings before interest, tax, depreciation and amortisation, from 3.7 times a year earlier. The company ended 2025 with more than $800 million in cash and undrawn credit lines, indicating a conservative approach to liquidity.
These steps are widely viewed as preparation for the MTN deal. The agreed enterprise value of $6.2 billion implies a multiple of roughly six times EBITDA, a level consistent with a stable but low growth infrastructure asset. The valuation reflects strong cash generation but also ongoing risks, including currency swings, customer concentration and slowing organic growth.
IHS did not provide financial guidance for 2026, citing the pending transaction. The absence of an outlook underscores how closely the company’s near-term trajectory is tied to the deal’s completion.
The strategic repositioning is clear. IHS is generating more cash, carrying less debt and focusing on operational efficiency. It is doing so while reducing its asset base and facing pressure on underlying demand. The model relies less on building new towers and more on maximising returns from existing sites.
For MTN, the acquisition offers tighter control over network infrastructure and potential cost synergies across its footprint. For IHS, the transition marks a pivot from growth to harvest, with financial discipline taking precedence over scale.
The key question is whether the leaner structure can sustain performance in a volatile operating environment. Currency gains and lower financing costs supported 2025 results, but those factors are not guaranteed to persist. Underlying indicators such as tenant numbers and organic revenue suggest that demand conditions remain fragile.
Investors and industry watchers will focus on whether efficiency gains can offset these pressures once the benefit of favourable currency movements fades. For now, the turnaround is evident in the financials, but it is driven as much by balance sheet repair and portfolio reshaping as by fundamental growth in the business.