IHS profit jumps to $77m in Q1 2026 as MTN buyout nears completion

IHS Holding Limited operator said on Tuesday that profit after tax rose 151 percent to $77 million in the three months ended March 31, 2026, from $30.7 million recorded in the same period last year.

The telecom tower reported a sharp rise in Q1 profit for 2026, helped by stronger cash generation, lower financing costs and a more stable Nigerian currency environment, as the company moves closer to its proposed $6.2 billion acquisition by MTN Group Limited.

Revenue from continuing operations increased six percent to $415.4 million, while total revenue, including discontinued Latin American operations earmarked for sale, rose 6.3 percent to $467.2 million.

The London-headquartered company, which operates more than 37,000 telecom towers across Africa and Latin America, said its adjusted EBITDA rose 6.4 percent to $268.7 million during the quarter.

The strong earnings came as IHS advanced a major restructuring of its business portfolio ahead of MTN’s planned takeover of the company.

In February, MTN announced plans to acquire IHS Towers in a deal valued at about $6.2 billion, extending a long-running commercial relationship between both firms. IHS also agreed to sell its Latin American tower operations to Macquarie Asset Management for about $952 million and its 51 percent stake in I-Systems to TIM S.A. for about $453 million.

IHS said the disposal of the I-Systems stake was completed in May 2026.

Sam Darwish, chairman and chief executive officer said the company delivered a positive start to the year despite ongoing customer churn and operational adjustments.

“We delivered a positive start to the year, with solid first-quarter revenue and free cash flow growth, underpinned by disciplined execution and continued commercial momentum across the business,” Darwish said.

Read also: IHS Towers completes fiber exit in Brazil amid major portfolio overhaul

He added that the proposed sale of IHS Towers to MTN remained an important strategic milestone.

The company said improved foreign exchange conditions in Nigeria also supported performance during the quarter.

The Nigerian naira appreciated by 4.6 percent against the U.S. dollar during the quarter, compared with the severe volatility experienced in 2024. IHS said the stronger naira added $26.7 million to reported revenue and contributed $16.9 million to adjusted EBITDA.

The company also recorded unrealised foreign exchange gains of $80.3 million on dollar-denominated intercompany loans tied to its Nigerian operations.

Nigeria remained IHS’s biggest market, contributing $285 million in revenue during the quarter, up five per cent year-on-year.

However, the company said underlying organic revenue in Nigeria declined because of lower revenues linked to foreign exchange resets and diesel price indexation clauses in customer contracts.

IHS also continued to feel the impact of customer exits in Nigeria.

Tenant numbers in Nigeria fell by 2,491 year-on-year, partly due to an agreement signed with telecom operator T2, formerly known as 9mobile, allowing the operator to vacate IHS sites in exchange for a structured repayment arrangement for overdue debts through 2027.

The company also said churn related to about 1,050 sites vacated by MTN Nigeria under earlier contract renewal agreements continued to affect tenant growth.

Still, demand for network upgrades and ancillary telecom services remained strong, with lease amendments in Nigeria rising by 4,240 during the quarter.

Across the group, total tenants fell by 4,752 to 54,854, while tower count declined by 1,571 to 37,641, mainly because of the disposal of the Rwanda business in October 2025.

Despite the reduction in tenants and towers, IHS maintained a colocation ratio of 1.46x, supported by continued growth in colocations and lease amendments.

Read also: Shrinking towers, rising cash: IHS cuts footprint while boosting cash before MTN takeover

Cash generation also improved significantly during the quarter.

Cash from operations rose 13.2 percent to $244.9 million, while adjusted levered free cash flow increased 15.8 per cent to $173.5 million.

The company attributed the improvement largely to lower interest payments following debt refinancing and repayments of high-cost borrowings.

IHS said net interest payments declined by $26.4 million during the quarter.

The company’s balance sheet also strengthened, with consolidated net leverage falling to 2.9x from 3.4x a year earlier.

Cash and cash equivalents rose to $940.5 million at the end of March, excluding another $26 million classified under assets held for sale.

Capital expenditure fell 5.3 percent to $41.4 million during the quarter as spending declined in its Sub-Saharan Africa and Latin American businesses.

Still, capital spending in Nigeria rose 45.4 percent to $16.4 million, driven by maintenance work, fibre investments and network augmentation projects.

IHS said it also secured a new N100 billion revolving credit facility in Nigeria during the quarter, with an option to increase it to N200 billion.

The facility matures in 2029 and had not been drawn as of May 2026.

The company said it would not host an earnings conference call because of the ongoing MTN acquisition process.

IHS operates towers in Nigeria, South Africa, Cameroon, Côte d’Ivoire, Zambia, Brazil and Colombia, and remains one of the world’s largest independent telecom infrastructure companies focused on emerging markets.