Millicom's Q4 2024: Contradictions in CapEx, Competition, and Strategic Priorities Unveiled

These are the key contradictions discussed in Millicom International Cellular S.A.'s latest 2024Q4 earnings call, specifically including: CapEx expectations, competition in key markets, CapEx spending projections, and strategic focus on market growth vs. cost management:



Equity-Free Cash Flow and Debt Reduction:
- Millicom International Cellular S.A. reported a record equity-free cash flow of $236 million in Q4 and $728 million for the full year, excluding tower sales.
- This growth was driven by an efficiency program that increased OCF margin by 8 percentage points and allowed the company to reduce its leverage below 2.5x.

Revenue Growth in Mobile and B2B:
- The Mobile business delivered organic service revenue growth of more than 4% in Q4, with full-year growth accelerating to 4.6%.
- This growth was attributed to expanding network capacity, increasing prepaid customer ARPUs, and strategically migrating prepaid customers to postpaid, driving overall revenue growth.

Strong Performance in Key Markets:
- Guatemala achieved OCF growth of around 10%, with an EBITDA margin reaching 54%, and Panama generated $250 million in OCF for the year.
- These results were due to efficiency programs, network optimizations, and strategic project wins, particularly in Panama's B2B sector.

Challenges and Strategic Initiatives:
- The company faces challenges in Colombia due to FX impacts, with Q4 service revenue negatively affected by a 5.8% weaker exchange rate.
- Despite this, Millicom is pursuing strategic initiatives, including the acquisition of Telefonica's stake in Coltel and a regulatory process in Costa Rica to combine operations, positioning the company for future growth.