MILLICOM INTERNATIONAL CELLULAR SA
For the period ended Nov 7, 2024. Filed Nov 7, 2024.
View on SEC.govAbout this filing
What a company based outside the US has published at home or sent to its shareholders. It is how many foreign companies share results and news between annual reports.
Nov 7, 2024 · Filed Nov 7, 2024
Use the contents to explore the available documents and sections.
Contents
5. SEGMENT INFORMATION
As further detailed in note 1, Millicom operates in a single region (Latin America), and more specifically in the following countries: Guatemala, Colombia, Panama, Honduras, Bolivia, Paraguay, El Salvador, Nicaragua and Costa Rica.
During the third quarter of 2024, Millicom announced several organizational changes aimed at strengthening its connection with each country and enhancing its understanding of their unique circumstances. Following the recent appointment of a new Chief Executive Officer (CEO), the Group has streamlined its structure, ensuring that all General Managers of operations and Executive Team reports directly to him. This strategic shift reinforces the Group´s commitment to prioritizing the customer experience while fostering collaboration and nurturing its internal talent. By redefining its segments as individual countries since 2023 year-end, Millicom is better positioned to drive growth and achieve results more effectively across all markets. The Chief Executive Officer (CEO) together with the Group Chief Financial Officer (CFO) and the Chief Technology & Information Officer (CTIO) form the ‘Chief Operating Decision Maker’ (“CODM”).
Millicom´s CODM assesses performance and allocates resources, based on individual countries, which are its operating segments. The Honduras joint venture is reviewed by the CODM in a similar manner as for the Group’s controlled operations and is therefore also shown as a separate operating segment at 100%. However, these amounts are subsequently eliminated in order to reconcile with the Group consolidated numbers, as shown in the reconciliations below.
Management evaluates performance and makes decisions about allocating resources to the Group's operating segments based on financial measures, such as revenue, including service revenue, and EBITDA. Capital expenditures are also a significant aspect for management and in the telecommunication industry as a whole. Management believes that service revenue and EBITDA are essential financial indicators for the CODM and investors. These measures are particularly valuable for evaluating performance over time. Management utilizes service revenue and EBITDA when making operational decisions, allocating resources, and conducting internal comparisons against historical performance and competitor benchmarks. Additionally, these metrics provide deeper insights into the Group's operating performance. Millicom's Compensation and Talent Committee also employs service revenue and EBITDA when assessing employees' performance and compensation, including that of the Group's executives. A reconciliation of service revenue to revenue and EBITDA to profit before taxes is provided below.
Before the organizational changes which took place in the second half of 2023 (as further explained in the 2023 Group's Annual Report), the Group reported a single segment, the Group Segment. As aforementioned, and since 2023 year-end, the Group considers the individual countries it operates in as its operating and reportable segments, and the below comparative information has been re-presented accordingly.
Revenue, Service revenue, EBITDA, capital expenditures and other segment information for the nine-month periods ended September 30, 2024, and 2023 are shown on the below:
| Nine months ended September 30, 2024 (in millions of U.S. dollars) | Guatemala | Colombia | Panama | Bolivia | Honduras | Paraguay | Other reportable segments (v) | Total for reportable segments | Inter-segment and other eliminations(iv) | Total Group |
|---|---|---|---|---|---|---|---|---|---|---|
| Service revenue(i) | 1,039 | 1,025 | 528 | 452 | 434 | 404 | 650 | 4,531 | (449) | 4,082 |
| Telephone and equipment revenue | 159 | 28 | 47 | 4 | 25 | 14 | 42 | 319 | (25) | 294 |
| Revenue | 1,197 | 1,053 | 575 | 456 | 459 | 418 | 692 | 4,850 | (474) | 4,376 |
| Inter-segment revenue | 6 | 1 | 1 | — | 3 | 3 | 6 | 21 | n/a | n/a |
| Revenue from external customers | 1,191 | 1,051 | 573 | 456 | 456 | 415 | 686 | 4,829 | n/a | n/a |
| EBITDA(ii) | 652 | 404 | 264 | 195 | 224 | 201 | 298 | 2,238 | (387) | 1,851 |
| Capital expenditures(iii) | 135 | 72 | 56 | 42 | 47 | 42 | 79 | 474 | (60) | 414 |
| (i) | Service revenue is revenue related to the provision of ongoing services such as monthly subscription fees for mobile and broadband, airtime and data usage fees, interconnection fees, roaming fees, mobile finance service commissions and fees from other telecommunications services such as data services, short message services, installation fees and other value-added services excluding telephone and equipment sales. |
| (ii) | EBITDA is operating profit excluding impairment losses, depreciation and amortization, share of profit in Honduras joint venture and gains/losses on the disposal of fixed assets. |
| (iii) | Capital expenditures correspond to additions of property, plant and equipment, as well as operating intangible assets, excluding spectrum and licenses. The Group capital expenditure additions for the nine-month periods ended September 30, 2024 and 2023 can be reconciled with notes 9 and 10 for amounts of $355 million and $59 million respectively (2023: $472 million and $75 million, respectively). |
| (iv) | Includes intercompany eliminations, unallocated items and Honduras as a joint venture. |
| (iv) | Includes our operations in El Salvador, Nicaragua and Costa Rica |
Unaudited Interim Condensed Consolidated Financial Statements for the three and nine-month periods ended September 30, 2024
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.