Delivering growth across all regions, all business units

• Acceleration of organic growth in the 1st quarter by 8.5% year-on-year in local currency
• 1.6 million mobile net adds in Q1 taking the total customer base to 51.6 million
• Africa accelerates with revenue growth close to 12% in the quarter in local currency
• Cable grows by nearly 13% as we launched Tigo Star, our convergent offer proposition in Latin America and Tigo Sports, our first content product
• MFS now has over 7.3 million customers and penetration exceeding 18% of our customer base where the service is offered
• The transformation to a Digital Lifestyle company moves ahead, as demonstrated by DTH launching in Latin America today and our partnership with Facebook in Tanzania
• EBITDA margin before corporate costs at 38.2% in Q1. After corporate costs, the margin was 34% demonstrating our financial discipline while investing in growth opportunities

Delivering growth across four strategic pillars:

• In Q1, our mobile data business continued to display strong growth with over 700k additions, improving penetration of mobile data within our mobile customer base to 20.9%, up from 15.1% in March 2013.
• In Cable & Digital Media, the growth accelerated compared to Q4 13 at 12.8% in local currency helped by the launch of “Tigo Star” and “Tigo Sports”, our new cable and broadband service and TV channels. RGU per household increased by 3.5% to 1.40.
• MFS penetration growth accelerated in the first quarter reaching 18.2% of our customers in the markets in which we offer the service. In Q1 we added over 1 million new customers, the strongest performers were Tanzania, El Salvador and Chad.
• Our Online investments continued to expand across Africa and Latin America as we saw several ventures being launched both in new countries and Millicom mobile markets. We look forward to MTN joining this journey in Africa as we wait for final regulatory approvals. We expect the deal to be completed as planned in Q2 2014.

Financial Highlights

• Q1 revenue of $1,405 million, growing 8.5% proforma in local currency (4% reported proforma)*. Revenue growth would have been 9.4% on a like-for-like basis**. The impact of forex movements was -4.8%.
• Q1 EBITDA before corporate costs at $537 million (38.2% margin). After corporate costs the EBITDA reached $478 million, a 34.0% margin.
• 2014 Q1 Capex of $163 million (11.6% of revenue).

* proforma: new consolidation perimeter

** Like-for-like: underlying organic growth excluding regulatory and one-off impacts 

Significant events

• Starting from Q1 2014, Millicom fully consolidates Tigo Guatemala, while Mauritius and the Online businesses (in Africa and Latin America) are now equity accounted.
• On January 30, 2014, Tigo Guatemala issued a 10 year $800 million bond. The proceeds from the bond were mainly used to refinance local and Millicom corporate debt. The bond carries a coupon of 6.875%.
• In February 11, 2014, Millicom announced the appointment of Tim Pennington as Chief Financial Officer. Tim will be joining in June 2014.
•  In February 2014 Millicom launched Tigo Sports in Paraguay followed by Tigo Star in March 2014.

2014 guidance reiterated

Under the new consolidation scope(i) and at constant exchange rates, we expect revenue growth to accelerate at a mid to high single digit rate (versus comparable 5.5% in 2013). On a reported basis and at constant exchange rates, we expect revenue growth to exceed 15%. EBITDA margin will stabilize around the mid-30s% mark (after corporate costs). In 2014, we expect a capex to revenue ratio of around 19%, excluding spectrum and license acquisitions.

EBITDA Margin improvement from the full consolidation of Guatemala will be offset in 2014 by accelerating investments in growth opportunities in Africa and South America. 

(i) The new consolidation scope includes full consolidation of Guatemala and equity accounting for Mauritius and Online and excludes UNE.

(ii) EBITDA: derived by deducting cost of sales, sales and marketing costs and general and administrative expenses (including central costs) from revenue, and adding other operating income.

(iii) Net profit adjusted for items such as foreign exchange movements, movements in valuation of the put options (negative $21 million in Q1 2014), and deferred tax assets, goodwill impairment and one-off tax impacts, revaluation of previously held interests and results from associates, joint ventures and start-up ventures.

(iv) Proforma to reflect full consolidation of Guatemala, and equity accounting for Mauritius and Online

Delivering growth across all regions, all business units

“This quarter’s results demonstrate that we are delivering on our growth strategy in all regions with revenue rising by over 8%. Our investment in this growth is having the expected impact on our margins.

The turnaround in Africa continued with double-digit growth for the first time in eight quarters and South America maintained its strong performance, led by Colombia.  

We transformed our cable business further with the launch of Tigo Star, the Tigo Sports channel and the start today of our first DTH service in Latin America.

Strong mobile data take-up is highlighted by our smartphones sales tripling in Q1 compared to Q1 2013 and content partnership with Facebook in Tanzania.

We have delivered on all four growth pillars with MFS just launched in Senegal, completing the lineup for Africa, and our online partnerships continued to expand.

There are challenges ahead.  Foreign exchange pressure continues, with competitive intensity not easing and the constant threat of further regulation.

As for earnings, we are in line with guidance on margins as we continue this crucial but carefully controlled investment phase. We are determined to grow our EBITDA as we diversify into a true digital lifestyle company over the long term”

Hans-Holger Albrecht
President and CEO,
Millicom International Cellular S.A.

Conference call details

A presentation and conference call to discuss results of the quarter will take place at 14.00 Stockholm / 13.00 London /08.00 New York, on Thursday 24 April, 2014.  Dial-in numbers: + 46 (0) 850 520 204, + 44 (0) 208 515 2303, + 1 480 629 9692. Access code is: 4673601          

A live audio stream of the conference call can also be accessed at www.millicom.com.  Please dial in / log on 10 minutes prior to the start of the conference call to allow time for registration.

Slides to accompany the conference call are available at www.millicom.com.

Contacts:

Press:
Julian Eccles, VP, Corporate Communications
Tel: +44 7720 409374 / press@millicom.com

Investor Relations:
Nicolas Didio, Director, Head of Investor Relations
Tel: +44 7795 385217 / investors@millicom.com

Visit our web site at http://www.millicom.com

Millicom is a leading telecom and media company dedicated to emerging markets in Latin America and Africa. Millicom sets the pace when it comes to providing innovative and customer-centric digital lifestyle services to the world’s emerging markets, giving access to the world, primarily through mobile devices. The Millicom Group employs more than 10,000 people and provides mobile services, access to the internet, content and financial services to over 50 million customers. Founded in 1990, Millicom International Cellular SA is headquartered in Luxembourg and listed on NASDAQ OMX Stockholm under the symbol MIC. In 2013, Millicom generated revenue of USD 5.16 billion and EBITDA of USD 1.88 billion.

This press release may contain certain “forward-looking statements” with respect to Millicom’s expectations and plans, strategy, management’s objectives, future performance, costs, revenue, earnings and other trend information.  It is important to note that Millicom’s actual results in the future could differ materially from those anticipated in forward-looking statements depending on various important factors.

All forward-looking statements in this press release are based on information available to Millicom on the date hereof.  All written or oral forward-looking statements attributable to Millicom International Cellular S.A., and Millicom International Cellular S.A. employees or representatives acting on Millicom’s behalf are expressly qualified in their entirety by the factors referred to above.  Millicom does not intend to update these forward-looking statements.

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