IHS Towers’ $147M Q3 profit driven by naira gains, masking MTN churn

IHS Towers, Africa’s largest infrastructure company, extended its new-found profit streak, but the third-quarter gains were driven almost entirely by favourable currency movements in Nigeria, its largest market, rather than a fundamental operational surge.

The company posted a $147.4 million profit for the quarter, a significant reversal from the $205.7 million loss reported in the same period of 2024. Investors, who have weathered four years of steep losses, may welcome the black ink, but a closer look reveals the profit was fueled by a $353.6 million favourable swing in net finance costs. This gain stems directly from the appreciation of the Nigerian naira against the U.S. dollar, which reduced the paper loss on USD-denominated intercompany loans.

While management touted “disciplined execution,” the operational performance was mixed. Organic revenue grew 8.3% to $455.1 million, bolstered by new tenants, lease amendments, and foreign exchange resets. However, this growth was partially offset by significant churn from its largest client, MTN Nigeria. As part of a 2024 contract renewal, MTN is in the process of vacating approximately 1,050 sites, which is dragging on revenue.

“These positive results… combined with a supportive macro environment, give us the confidence to again raise guidance,” said CEO Sam Darwish. That “supportive macro environment” refers directly to the sustained strength of the naira and recent tariff increases granted to IHS’s key clients, MTN and Airtel, which have bolstered their own ability to pay.

IHS is looking to 5G for new growth, announcing an expanded partnership with TIM in Brazil to develop up to 3,000 new sites.

Despite the positive guidance and a new profit streak, the company’s fortunes remain precariously tethered to Nigeria’s currency stability. After years of heavy losses driven by a devaluing naira, the current recovery is equally dependent on that same currency swinging the other way.