Millicom has disclosed its strategy to grow revenues over five years to over USD 9 billion annually. Millicom plans to focus on widening its portfolio of digital services in emerging markets such as Africa and Latin America. The company outlined five pillars on which its future direction will rest, nemly mobile, mobile financial services (MFS), broadband cable and TV, digital commerce & services, and cost and capex optimization.
Millicom plans to focus on growing its data revenues on 3G and 4G, adding up to 18 million new mobile date subscribers to 2017. As a result, revenues in the mobile area are expected to grow in the mid-single digits. Consumers will increasingly be offered bundled services, adding digital products such as music and video. Millicom expects to add between USD 900 million to USD 1.3 billion in revenues in five years’ time.
Millicom currently claims a 10 percent share of the mobile financial services opportunity globally. It is expected that USD 600 million to USD 1 billion in revenues could be added from these products by 2017.
Millicom intends to boost growth in its fixed line and TV presence in Latin America. In addition to the current negotiations in Colombia with Une, Millicom aims to grow this business by driving product penetration levels, driving footprint build-out, and pursuing consolidation opportunities. Also, Millicom will evaluate selective launches of TV platforms via DTH or OTT. Including the potential combination in Colombia, Millicom expects revenues to rise in the range of USD 1.8 billion – USD 2.6 billion.
Millicom also intends to focus on cost optimization to save USD 100 million in opex. The company’s growth plans will be supported by cash generation. Capex will be strictly limited to reach 15 percent of revenues as early as 2016. Millicom will then target a capex/revenue ratio in line with its peer industry group.
