Analysis of Helios Towers plc’s Business

Helios Towers plc (LON:HTWS) is an independent tower company that focuses on acquiring, building, and operating telecommunications towers and passive infrastructure. The company’s market capitalization is currently UK£932 million. Helios Towers has managed to reduce its losses over time, with a full-year loss of US$172 million in the past financial year compared to a trailing-twelve-month loss of US$88 million. The company is now approaching breakeven.

Investors are particularly interested in knowing when Helios Towers will achieve profitability. According to consensus estimates from six British Telecom analysts, the company is on the brink of breakeven. They expect the company to incur a final loss in 2024, followed by positive profits of US$32 million in 2025. Therefore, it is projected that Helios Towers will achieve breakeven in approximately two years.

To meet this breakeven target, the company must grow at an average annual rate of 73%, as calculated by analysts. Such a high growth rate indicates a high level of confidence in the company’s future prospects. However, if this growth rate proves to be overly aggressive, Helios Towers may take longer to become profitable than anticipated.

It’s important to note that Helios Towers currently has a debt-to-equity ratio of over 2x, which is considerably higher than the recommended limit of 40%. This high level of debt increases the risk associated with investing in a company that is currently operating at a loss and requires stringent capital management.

In conclusion, Helios Towers is expected to achieve profitability within the next two years, with a projected growth rate of 73% per year. However, the company’s high debt-to-equity ratio raises concerns about its financial stability. Investors should carefully consider these factors before making any investment decisions.

Note: This article is a general analysis based on historical data and analyst forecasts. It does not constitute financial advice and does not take into account individual objectives or financial situations.