UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF THE

SECURITIES EXCHANGE ACT OF 1934

For the month of February, 2022. 

Commission File Number: 001-38763

MILLICOM INTERNATIONAL CELLULAR S.A.

(Exact Name of Registrant as Specified in Its Charter)

2, Rue du Fort Bourbon,

L-1249 Luxembourg

Grand Duchy of Luxembourg

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

MILLICOM INTERNATIONAL CELLULAR S.A.

INDEX TO FURNISHED MATERIAL

Item
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Item 1

Earnings Release    Q4 2021

Luxembourg, February 11, 2022

Strong finish to a solid 2021

Group highlights Q4 2021

The financial highlights discussed and summarized in the table below are presented on an IFRS basis and therefore do not include our results from our Honduras joint venture. Since acquiring the remaining 45% equity interest on November 12, 2021 we fully consolidate our Guatemala business in our consolidated financial statements.

Latin America segment highlights¹ – Q4 2021

Our Latin America (“Latam”) segment includes our Guatemala and Honduras joint ventures as if they were fully consolidated. The acquisition of the remaining 45% equity interest in our Guatemala joint venture business on November 12, 2021, had no impact on the way we present our Latin America segment, as the segment already included our operations in Guatemala as if it was fully consolidated.

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¹ Service revenue, EBITDA, EBITDA margin, Capex, OCF and Organic growth are non-IFRS measures. See page 13 for a description of these measures and for reconciliations to the nearest equivalent IFRS measures. 

Earnings Release    Q4 2021

Millicom Chief Executive Officer Mauricio Ramos commented:

"In 2021, we accelerated our investments to meet the heightened demand for connectivity we see in our markets. The immediate impact of this investment is impressive: robust customer growth, including record 1.1 million postpaid mobile and 415,000 cable subscriber net additions, all reflecting the quality of our networks and the strength of our brand. As a result, our service revenue and EBITDA grew 6.7%, our fastest organic growth rate in years.

We continued to invest to support the growth of our cable business, which now represents 40% of our Latam service revenue and grew 9.3% in 2021, and we also deployed capital to gain scale in the Colombian mobile market, leading to a significant acceleration in customer and revenue growth during the second half of the year and positioning us for continued rapid growth and improved profitability in that market in 2022. Finally, we acquired the remaining 45% equity interest in our Guatemala operations in a highly accretive transaction.

During the past year, we made great strides toward significantly advancing our ESG agenda. On climate, we have submitted Near-Term Science-Based Targets, and we have action plans that will allow us to meet these goals. Meanwhile, we have continued to strengthen employee engagement and maintained our position as the top ranked telco in the region in the 2021 Great Place to Work survey.

With a clear sense of purpose, the passion of our Sangre Tigo, world-class governance, as well as robust networks and a thriving brand, we have built a solid foundation upon which to deliver sustainable growth and shareholder value creation in 2022 and for years to come."

Outlook

In 2022, we plan to accelerate expansion of our fixed network to reach one million additional homes, of which over half are expected to be deployed using fiber-to-the-home (FTTH) technology. We expect the cost of this accelerated network deployment will be more than offset by a moderation of our investments in our mobile networks, as we are now in the final stages of significant modernization and expansion projects undertaken over the past 24 months.

We expect these investments will help sustain solid organic service revenue, EBITDA and operating cash flow growth. Specifically, we are targeting organic OCF growth of around 10% per year over the next three years² on average, reflecting expected mid-single-digit organic service revenue growth and annual capex of around $1.0 billion.

Subsequent Events

On January 27, 2022, our principal subsidiary in Guatemala, Comcel, completed the issuance of a new 10-year $900 million Bond with a coupon of 5.125%. Proceeds from this bond as well as cash were used to repay a significant portion of the bridge financing that was used to fund the acquisition of the remaining 45% equity interest in our Tigo Guatemala operations. As of February 8, 2022, a balance of $450 million remained unpaid under the initial $2.15 billion bridge loan agreement.

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² Rebased to reflect our reporting under IFRS scope, which excludes Honduras, and the planned disposal of our remaining African business. 

Earnings Release    Q4 2021

On January 13, 2022, we completed the issuance of a new 5-year sustainability bond raising SEK 2.25 billion (approximately $252 million) at a fully swapped rate of SOFR plus 3.496%. Proceeds will be used to fund investments in accordance with the Company's sustainability framework. This bond has been fully hedged against foreign exchange fluctuations.

Group Quarterly Financial Review - Q4 2021

In Q4 2021, group revenue increased 23.7% year-on-year to $1,347 million due to strong customer growth in all business lines and countries and the consolidation of our Guatemala operations beginning on November 12, 2021, compared to a softer top line in some parts of the business due to the negative impact of the COVID-19 in Q4 2020 and due to the impact of currency translation. Cost of sales increased 31.5% in Q4 2021 compared to Q4 2020, due to the effect of lower bad debt provisions in Q4 2020 and the consolidation of Guatemala.

Operating expenses increased 19.4% ($79 million) year-on-year to $483 million, reflecting increased sales and marketing costs to support customer growth in Q4 2021 as well as the consolidation of Guatemala, as compared to Q4 2020 which was impacted by lower commercial activity in our markets and weaker foreign exchange rates.

Depreciation increased 3.3% ($8 million) year-on-year to $238 million, as network modernization activities which accelerated the depreciation of older infrastructure in 2020 were offset by the consolidation of Guatemala. Amortization increased by 7.5% ($6 million) to $79 million. Our share of profits in joint ventures decreased to $25 million in Q4 2021 from $71 million in Q4 2020 due to the consolidation of our Guatemala operations which are now fully consolidated. Other operating income of $14 million compares to an expense of $43 million in Q4 2020 related to the impairment of a loan with our former Ghana joint venture.

As a result of the above factors, operating profit was $212 million in Q4 2021, up 71.7% year-on-year.

Earnings Release    Q4 2021

Net financial expenses decreased $22 million year-on-year to $140 million, reflecting debt repayment and refinancing activity over the past year, and due to expenses in Q4 2020 related to the early redemption of the 2025 MICSA bond.

As a result of the acquisition of the remaining 45% shareholding in Guatemala, the Group revalued its previously held 55% investment at the fair value implied by the deal, as required under IFRS. This resulted in the recognition of a gain of $670 million with a corresponding increase in intangibles and goodwill. Other non-operating expense of $12 million reflects foreign exchange losses and compares to income of $41 million in Q4 2020.

Charges for taxes increased to $105 million in Q4 2021 from $54 million in Q4 2020. The increase was mainly due to the consolidation of our operations in Guatemala, higher profitability in the operations of the Group and a one-off tax provision in Tanzania, as well as the net effect of changes in deferred tax assets in Colombia. Non-controlling interests were a $20 million gain in Q4 2021, reflecting our partners' share of net losses in Colombia, up from $0.5 million in Q4 2020.

Earnings Release    Q4 2021

As a result of these factors, net profit attributable to owners of the company was $643 million, or $6.41 per share, as compared to a net loss of $56 million ($0.55 loss per share) in Q4 2020. The weighted average number of shares during the quarter was 100.30 million, a decline of 0.9% year-on-year, as share repurchases more than offset issuance under the employee share-based compensation plans. As of December 31, 2021, we had 101,739,217 shares outstanding, including 1,538,256 held in treasury.

Cash Flow

* Non-IFRS measures. See page 13 for a description of these measures. Please refer to page 18 of this Earnings Release or to Note 4 of our Unaudited Interim Condensed Consolidated Financial Statements for the reconciliation of Operating free cash flow to the nearest IFRS measures. In prior years, equity free cash flow was calculated by including the results of Guatemala and Honduras as if fully consolidated. On that same comparable basis, equity free cash flow was $659 million in FY 2021 and $542 million in FY 2020, before lease principal repayments of $169 million in FY 2021 and $152 million in FY 2020.

During FY 2021, Operating Free Cash Flow (OFCF) was $619 million, a decrease of $38 million compared to $657 million in FY 2020. The decline was largely due to increased working capital due to better trade payables in 2020, as well as higher capex, which more than offset the increase in EBITDA during the period.

In FY 2021, dividends and advances received from our joint ventures were $13 million, compared to $71 million received in FY 2020. This reflects the decision to prioritize use of Guatemala's robust cash flow generation to reduce gross debt in Guatemala during 2021. In early 2022, we issued a new $900 million bond in Guatemala after our acquisition of the minority stake of this businesses.

Finally, dividends paid to non-controlling interests in Colombia were $6 million in FY 2021. As a result of these factors, Equity Free Cash Flow (EFCF) for FY 2021 was $135 million, as compared to $172 million in FY 2020. Further adjusting for lease principal repayments, EFCF after leases was negative $2 million in FY 2021, a decline of $58 million from $56 million in FY 2020. The slightly negative EFCF after leases reflects our decision to prioritize Guatemala's acquisition debt reduction; including Guatemala and Honduras as if fully consolidated for the full year, EFCF after leases was $490 million in FY 2021, up $101 million from $389 million in FY 2020.

Earnings Release    Q4 2021

Debt

* Net Debt and Net financial obligations are non-IFRS measures. See page 13 for a description of non-IFRS measures and for reconciliations to the nearest equivalent IFRS measures. Cash includes term deposits of $35 million as of December 31, 2021 and Honduras as if fully consolidated..

In order to provide a more complete picture of the Group's financial situation, this section discusses gross debt, leases, cash, and net debt on an underlying basis, a non-IFRS measure that includes Honduras as if fully consolidated. On November 12, 2021, Millicom acquired the remaining 45% equity interest in its joint venture business in Guatemala and as a result Millicom fully consolidates Tigo Guatemala as of this date.

As of December 31, 2021, underlying gross debt was $8,023 million, an increase of $2,020 million during the quarter due to financing of the Guatemala transaction. As of December 31, 2021, $1.65 billion remained outstanding out of the initial $2.15 billion bridge financing. Our underlying gross debt includes Honduras, which had $279 million of gross debt as of December 31, 2021, a decrease of $41 million during the quarter.

Excluding the remaining bridge loan balance, approximately 60% of underlying gross debt at December 31, 2021 was in Latam, 3% in Africa, and the remaining 37% at the corporate level. Over the past year, we have lowered our average effective interest rate to 5.5% from 5.6% while also improving the mix to 47% in local currency or swapped for local currency as of Q4 2021, up from 44% as of Q4 2020. In addition 78% was at fixed rates or swapped for fixed rates and the average maturity of 5.8 years, in line with our targets. On our dollar-denominated debt¹, the average rate was 4.8% with an average maturity of 6.4 years, as of December 31, 2021, as compared to an average rate of 5.0% and an average maturity of 6.6 years as of September 30, 2021.

Our underlying cash position was $969 million as of December 31, 2021, a decrease of $15 million compared to $984 million as of September 31, 2021. Of our underlying cash balance, 60% was held in U.S. dollars. As a result, our underlying net debt was $7,054 million as of December 31, 2021, an increase of $2,035 million during the quarter, reflecting the Guatemala transaction.

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¹ Including also SEK denominated bonds 

Earnings Release    Q4 2021

In addition, as of December 31, 2021, we had underlying lease liabilities of $1,228 million, which represented 13% of underlying gross financial obligations. Including these lease liabilities, underlying net financial obligations were $8,282 million as of December 31, 2021, an increase of $2,046 million during the quarter.

Proportionate leverage², which captures our proportional ownership in each country as well as lease obligations, was 3.36x as of December 31, 2021. This is up from 2.81x as of September 31, 2021 due to the increase in debt used to fund the Guatemala acquisition. Excluding the impact of leases, proportionate leverage would have been 3.30x³, compared to 2.67x as of September 31, 2021. Proforma for the planned $750 million rights issue⁴, proportionate leverage would be 3.03x.

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² Proportionate leverage is a non-IFRS measure calculated using LTM (last twelve-month) EBITDA, proforma for acquisitions and disposals. 

³ Proportionate leverage after leases is the ratio of proportionate net debt over LTM EBITDA after leases, proforma for acquisitions made during the last twelve months. Refer to page 13 for a description of non-IFRS measures and for reconciliations to the nearest equivalent IFRS measures. 

⁴ As announced in our press release on November 12, 2021. 

Earnings Release    Q4 2021

Operating segment performance

Our management determines operating and reportable segments based on the reports that are used by the chief operating decision maker to make strategic and operational decisions from both a business and geographic perspective. The Millicom Group's risks and rates of return for its operations are predominantly affected by operating in different geographical regions. The Millicom Group has businesses in two main regions, Latin America and Africa, which constitute our two segments. We allocate corporate costs to each segment based on their contribution to underlying revenue, and only unusual costs, such as the M&A-related fees remain unallocated.

Our Latin America segment includes our Honduras joint venture as if it were fully consolidated, as this reflects the way our management reviews and uses internally reported information to make decisions about operating matters. Although we acquired the remaining 45% equity interest in our Guatemala joint venture business on November 12, 2021, the acquisition has no impact on the way we present our Latin America segment because it already included our operations in Guatemala as if they were fully consolidated. Our Africa segment does not include our former joint venture in Ghana because our management does not consider it to be a strategic part of the group.

Please refer to Note 4 of our Unaudited Interim Condensed Consolidated Financial Statements for more details on our segments. The information contained herein can also be accessed electronically in the Financial & Operating Data Excel file published at www.millicom.com/investors alongside this earnings release.

Latin America segment

Business units

We discuss our Latam results under two principal business units:

1. Mobile, including mobile data, mobile voice, and mobile financial services (MFS) to consumer, business and government customers;

2. Cable and other fixed, including broadband, Pay TV, content, and fixed voice services for residential (Home) customers, as well as voice, data and value-added services and solutions to business and government customers.

On occasion, we also discuss our performance by customer type, with B2B referring to our business and government customers, while B2C includes residential and personal consumer groups.

Market environment

Economic activity continued to recover in our markets, while remittances from the U.S. to Central America sustained double-digit growth year-on-year. Meanwhile, vaccination rates improved to above 50% in Colombia, Costa Rica, El Salvador and Panama, but remained below 30% in Guatemala. During the quarter, the number of new COVID cases was stable, and there were few restrictions on mobility. Currencies in our markets were generally stable, except for the Colombian peso and the Costa Rican colon which both depreciated approximately 2% during the quarter. Foreign exchange rates and movements are presented on page 16.

Earnings Release    Q4 2021

Latam segment - Key Performance Indicators

Mobile services

We ended Q4 2021 with 44.9 million customers, an increase of 980,000 during the quarter, including 337,000 net additions in postpaid, with over 263,000 of these coming from Colombia, where our investments in spectrum, network and distribution channels have extended our reach, improved customer experience, and are driving robust customer gains. In prepaid, we added 643,000 customers during the quarter, ending the period with 38.9 million, up 6% year-on-year, with Colombia and Guatemala accounting for the majority of the net gains. We added 1.1 million new 4G smartphone data users, and these now account for 48% of our mobile customer base, up from 44% in Q4 2020.

Mobile ARPU was flat sequentially at $6.4, declining 5.8% compared to Q4 2020. ARPU increased in Nicaragua and Panama, where we have invested to upgrade our networks over the past two years.

Cable and other fixed services

In Home, our residential cable business, we continued to experience healthy demand for our services, and we added 62,000 HFC customer relationships in the quarter, capping a record year with more than 415,000 new customers added in 2021. At the end of Q4, our networks passed 12.7 million homes, an increase of 147,000 during the quarter, as we continued to expand our network mainly in Colombia, Paraguay, Bolivia and El Salvador. As a result, penetration on our HFC network increased to 33.4%, an increase of 2.0 percentage points from 31.4% in Q4 2020. Home ARPU averaged $27.9 for the quarter and was broadly stable both year-on-year and compared to Q3 2021.  

Earnings Release    Q4 2021

Latam segment financial results

* Service revenue, EBITDA, EBITDA margin, Capex, OCF and organic growth are Non-IFRS measures. Capex is defined as capital expenditures excluding spectrum, license costs and finance lease capitalizations. See page 13 for a description of non-IFRS measures and for reconciliations to the nearest equivalent IFRS measures.

In Q4 2021, revenue in our Latam segment increased 4.1% year-on-year to $1,597 million, while service revenue increased 4.6% to $1,458 million. Adjusting for currency, organic service revenue growth was 5.7% year-on-year, benefiting from a second consecutive quarter of positive growth in all countries and business units.

El Salvador sustained its strong performance, with service revenue growing 11.1%, with all three business lines growing sequentially and benefiting from recent spectrum and network investments in that country. In Panama, growth across all business units, including double digit mobile and B2B growth, drove 10.2% service growth. In Colombia, organic service revenue growth in consumer mobile accelerated to 12.9% and led to 6.4% growth in that country. Finally, organic service revenue grew 13.1% in Nicaragua and 10.0% in Costa Rica.

By business unit, Home service revenue grew 10.0% organically, fueled by customer growth and stable ARPU. In our consumer Mobile business, organic service revenue grew 4.2% year-on-year, with both prepaid and postpaid growing. Finally, B2B service revenue increased 3.3% organically, as the majority of countries saw improved B2B performance during the quarter as the macroeconomic context improved in most countries.

EBITDA for our Latam segment was $617 million in Q4 2021 and decreased 2.7% year-on-year due to effect of weaker currencies and increased investments related to the expansion of our Fintech hub, which added $8 million to corporate costs in the quarter. EBITDA of $634 million in Q4 2020 was positively impacted by a $20 million reversal in bad debt provisions made earlier in the year. EBITDA growth was very strong in Panama (19.3%), and Nicaragua (12.6%), and Colombia saw a notable increase in EBITDA compared to Q3. EBITDA declined in some countries due to largely to the reversal of bad debt provisions in Q4 2020.

Earnings Release    Q4 2021

Capex in Latin America was $417 million in the quarter. In mobile, we added more than 900 points of presence to our 4G network, and we ended the quarter with more than 17,500, an increase of 17% year-on-year. At the end of Q4 2021, our 4G networks covered approximately 78% of the population (approximately 120 million in our markets), up from approximately 74% at Q4 2020.

Operating Cash Flow (OCF) decreased 27.4% year-on-year to $200 million in Q4 2021, an decrease of 18.6% on an organic basis on higher capex. Including our Africa segment, underlying OCF was $210 million for the quarter and $1.45 billion for the year, surpassing our target of at least $1.40 billion for the year.

Africa segment - Segment financial results and Key Performance Indicators

Please refer to Note 4 of our Unaudited Interim Condensed Consolidated Financial Statements for more details on our segments.

* Service revenue, EBITDA and Capex are non-IFRS measures. See page 13 for a description of non-IFRS measures and for reconciliations to the nearest equivalent IFRS measures.

Our Africa segment comprises our Tanzania operations. On April 19, 2021, we announced the signing of an agreement for the sale of our operations in Tanzania to a consortium led by Axian, a pan-African group that was part of the consortium that acquired Millicom’s operations in Senegal in 2018. Completion remains subject to regulatory approvals. On 24 December 2021, we received approval from the Tanzania Communications Regulatory Agency (TCRA). Although additional approvals remain pending, we expect the transaction will receive all the necessary approvals to be completed.

Service revenue for our Africa segment decreased 4.9% year-on-year to $92 million in Q4 2021, while EBITDA declined 27.7% year-on-year to $25 million. The decline in performance was mostly due to a reduction in customer usage of mobile financial services, which make up a third of our revenues, due to a new government levy imposed on many mobile money transactions, as well as a government claim. Capex of $16 million was 27.9% higher year-on-year, resulting in OCF of $8 million, a drop of 60.8% year-on-year.

Earnings Release    Q4 2021

ESG highlights – Q4 2021

Revamping our ESG approach

2021 was a watershed year for our work in ESG, most of which we formerly addressed under the Corporate Responsibility umbrella. While the concept is far from new to us, the Executive Team led a comprehensive review of our existing work areas to update and upgrade our approach. Much of the work has been underway for many years, which is reflected in mature programs and robust performance. This nomenclature allows us to reorganize key focus areas, further enhancing internal collaboration, management and alignment on material issues, while improving our public disclosures in response to the increasing stakeholder demand for ESG performance data.

Environment

As per our public commitments, a cross-functional team worked throughout 2021 to set new emissions reduction targets, since our previous ones, set in 2015, had been met ahead of time. We based our analysis on the Science-Based Target methodology, and we submitted our first near-term Science-Based Targets in Q4, consistent with a climate scenario limiting global warming to 1.5°C for Scopes 1 and 2, and to 2°C for Scope 3 emissions. Furthermore, we have joined the Business Ambition for 1.5°C campaign and committed to set net-zero targets under the Science-Based Targets Initiative standard.

Society

Digital Education

We have officially initiated the soft launch of our Conectadas App in five countries through our local implementing partners. This initial pilot will allow us to optimize the App ahead of our launch planned for March. The content for the App has been developed by the Grameen Foundation and covers both the use of online tools for entrepreneurs as well as personal finances and the use of mobile financial services.

With our partner AHYU, we organized the first regional Maestr@s Conectad@s virtual congress with more than 30,000 participants from Latin America. The congress featured 11 experts in the field of education who shared key insights on the future of education and their role as educators.

Finally, we ended 2021 with the Fundación Real Madrid partnership officially launched in six of our Latam operations Our programs have already reached over 1,600 beneficiaries and are projected to reach over 11,000 over a timeframe of 5 years.

Supply Chain Management

We surpassed our intended 2021 goal of training 75% of strategic suppliers in our ESG training, putting us well on track to reaching our 2022 goal of training 100% of our suppliers in that same category.

Earnings Release    Q4 2021

Governance

Compliance

In Q4 2021, we finished our annual mandatory Compliance training with a completion rate of 99%. In November and December, we celebrated our Compliance Week and Anti-Corruption Day, respectively, hosting various activities that included global senior management and issuing communications that reinforced awareness amongst all personnel.

As part of our continuous improvement efforts, we concluded the revision of our Code of Conduct, as well as our Anti-Corruption, Speak Up, and AML (Anti Money Laundering) policies, which have been approved at board level and expected to be formally launched in Q1 2022. All other Corporate Compliance Policies are also being updated.

Earnings Release    Q4 2021

Video conference details

A video conference to discuss these results will take place on February 11 at 14:00 (Luxembourg/Stockholm) / 13:00 (London) / 08:00 (Miami). Registration for the live event is required and is available at the following link. After registering, participants will receive a confirmation email containing details about joining the video conference. Alternatively, participants can join in a listen-only mode, by dialing any of the following numbers and using webinar ID number 871-5924-8681. Please dial a number base on your location:

Additional international numbers are available at the following link.

A replay of the event will be available on the Millicom website.

Financial calendar

2022

For further information, please contact

About Millicom

Millicom (NASDAQ U.S.: TIGO, Nasdaq Stockholm: TIGO_SDB) is a leading provider of fixed and mobile telecommunications services dedicated to emerging markets in Latin America and Africa. Through our TIGO® and Tigo Business® brands, we provide a wide range of digital services and products, including TIGO Money for mobile financial services, TIGO Sports for local entertainment, TIGO ONEtv for pay TV, high-speed data, voice, and business-to-business solutions such as cloud and security. As of December 31, 2021, Millicom employed approximately 21,000 people and provided mobile services through its digital highways to around 58 million customers, with a fiber-cable footprint of more than 12 million homes passed. Founded in 1990, Millicom International Cellular S.A. is headquartered in Luxembourg. For more information, visit: millicom.com. Connect with Millicom on Twitter, Instagram, Facebook and LinkedIn.

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¹ The deadline for submitting additional items to the 2022 AGM is April 12, 2022. 

Earnings Release    Q4 2021

Forward-Looking Statements

Statements included herein that are not historical facts, including without limitation statements concerning future strategy, plans, objectives, expectations and intentions, projected financial results, liquidity, growth and prospects, are forward-looking statements. Such forward-looking statements involve a number of risks and uncertainties and are subject to change at any time. In the event such risks or uncertainties materialize, Millicom’s results could be materially adversely affected. In particular, there is uncertainty about the spread of the COVID-19 virus and the impact it may have on Millicom's operations, the demand for Millicom's products and services, global supply chains and economic activity in general. The risks and uncertainties include, but are not limited to, the following:

A further list and description of risks, uncertainties and other matters can be found in Millicom’s Registration Statement on Form 20-F, including those risks outlined in “Item 3. Key Information—D. Risk Factors,” and in Millicom’s subsequent U.S. Securities and Exchange Commission filings, all of which are available at www.sec.gov. To the extent COVID-19 adversely affects Millicom's business and financial results, it may also have the effect of heightening many of the risks described in its filings.

All forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by this cautionary statement. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof. Except to the extent otherwise required by applicable law, we do not undertake any obligation to update or revise forward-looking statements, whether as a result of new information, future events or otherwise.

Earnings Release    Q4 2021

Non IFRS Measures

This press release contains financial measures not prepared in accordance with IFRS. These measures are referred to as “non-IFRS” measures and include: non-IFRS service revenue, non-IFRS EBITDA, and non-IFRS Capex, among others defined below. Annual growth rates for these non-IFRS measures are often expressed in organic constant currency terms to exclude the effect of changes in foreign exchange rates, the adoption of new accounting standards, and are proforma for material changes in perimeter due to acquisitions and divestitures. The non-IFRS financial measures are presented in this press release as Millicom’s management believes they provide investors with an additional information for the analysis of Millicom’s results of operations, particularly in evaluating performance from one period to another. Millicom’s management uses non-IFRS financial measures to make operating decisions, as they facilitate additional internal comparisons of Millicom’s performance to historical results and to competitors' results, and provides them to investors as a supplement to Millicom’s reported results to provide additional insight into Millicom’s operating performance. Millicom’s Remuneration Committee uses certain non-IFRS measures when assessing the performance and compensation of employees, including Millicom’s executive directors.

The non-IFRS financial measures used by Millicom may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies - refer to the section “Non-IFRS Financial Measure Descriptions” for additional information. In addition, these non-IFRS measures should not be considered in isolation as a substitute for, or as superior to, financial measures calculated in accordance with IFRS, and Millicom’s financial results calculated in accordance with IFRS and reconciliations to those financial statements should be carefully evaluated.

Financial Measure Descriptions

Service revenue is revenue related to the provision of ongoing services such as monthly subscription fees, 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.

EBITDA is operating profit excluding impairment losses, depreciation and amortization, and gains/losses on fixed asset disposals. In respect of the segments Latam or Africa it is shown after the allocation of Corporate Costs and inter-company eliminations.

EBITDA after Leases (EBITDAaL) represents EBITDA excluding lease interest and principal repayments.

EBITDA Margin represents EBITDA in relation to Revenue.

Proportionate EBITDA is the sum of the EBITDA in every country where Millicom operates, including its Guatemala and Honduras joint ventures, pro rata for Millicom’s ownership stake in each country.

Organic growth represents year-on-year growth excluding the impact of changes in FX rates, perimeter, and accounting. Changes in perimeter are the result of acquisitions and divestitures. Results from divested assets are immediately removed from both periods, whereas the results from acquired assets are included in both periods at the beginning (January 1) of the first full calendar year of ownership.

Net debt is Debt and financial liabilities less cash and pledge and time deposits.

Net financial obligations is Net debt plus lease liabilities.

Proportionate financial obligations is the sum of the net financial obligations in every country where Millicom operates, including its Guatemala and Honduras joint ventures, pro rata for Millicom’s ownership stake in each country.

Earnings Release    Q4 2021

Leverage is the ratio of net financial obligations over LTM (Last twelve month) EBITDA, proforma for acquisitions made during the last twelve months.

Leverage after leases is the ratio of net debt over LTM (Last twelve month) EBITDA after leases, proforma for acquisitions made during the last twelve months.

Proportionate leverage is the ratio of proportionate net financial obligations over LTM proportionate EBITDA, proforma for acquisitions made during the last twelve months.

Proportionate leverage after leases is the ratio of proportionate net debt over LTM (Last twelve month) EBITDA after leases, proforma for acquisitions made during the last twelve months.

Capex is balance sheet capital expenditure excluding spectrum and license costs and lease capitalizations.

Cash Capex represents the cash spent in relation to capital expenditure, excluding spectrum and licenses costs.

Operating Cash Flow (OCF) is EBITDA less Capex.

Operating Free Cash Flow (OFCF) is OCF less changes in working capital and other non-cash items and taxes paid.

Equity Free Cash Flow (EFCF) is OFCF less finance charges paid (net), less advances for dividends to non-controlling interests, plus dividends received from joint ventures.

Equity Free Cash Flow after Leases (EFCFaL) is EFCF, less lease principal repayments.

Operating Profit After Tax displays the profit generated from the operations of the company after statutory taxes.

Return on Invested Capital (ROIC) is used to assess the Group’s efficiency at allocating the capital under its control to and is defined as Operating Profit After Tax, including Guatemala and Honduras as if fully consolidated, divided by the average invested Capital during the period.

Average Invested Capital is the capital invested in the company operation throughout the year and is calculated with the average of opening and closing balances of the total assets minus current liabilities (excluding debt, joint ventures, accrued interests, deferred and current tax, cash as well as investments and non-controlling interests), less assets and liabilities held for sale.

Underlying measures, such as Underlying service revenue, Underlying EBITDA, Underlying equity free cash flow, Underlying net debt, Underlying leverage, etc., include Guatemala and Honduras, as if fully consolidated.

Average Revenue per User per Month (ARPU) for our Mobile customers is (x) the total mobile and mobile financial services revenue (excluding revenue earned from tower rentals, call center, data and mobile virtual network operator, visitor roaming, national third parties roaming and mobile telephone equipment sales revenue) for the period, divided by (y) the average number of mobile subscribers for the period, divided by (z) the number of months in the period. We define ARPU for our Home customers in our Latin America segment as (x) the total Home revenue (excluding equipment sales, TV advertising and equipment rental) for the period, divided by (y) the average number of customer relationships for the period, divided by (z) the number of months in the period. ARPU is not subject to a standard industry definition and our definition of ARPU may be different to other industry participants.

Please refer to our 2020 Annual Report for a list and description of non-IFRS measures.

Earnings Release    Q4 2021

Non-IFRS Reconciliations

Reconciliation from Reported Growth to Organic Growth for the Latam segment¹

*Organic growth is calculated by re-basing all periods to the budget FX rates of the current year. This creates small differences that are captured in "Other". EBITDA and OCF are calculated excluding the allocation of corporate costs to reflect operational growth and to align with how we manage the Latam segment, and this creates additional differences that are also included in "other".

ARPU reconciliations

* Refers to production services, MVNO, DVNO, equipment rental revenue, call center revenue, national roaming, equipment sales, visitor roaming, tower rental, DVNE, and other non-customer driven revenue.

** Average QoQ for the quarterly view is the average of the last quarter.

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¹ See Note 4 of our Unaudited Interim Condensed Consolidated Financial Statements for details on our segments. 

Earnings Release    Q4 2021

* TV advertising, production services, equipment rental revenue, call center revenue, equipment sales and other non customer driven revenue.

** Represented by homes connected all technologies (HFC + Other Technologies + DTH & Wimax RGUs).

*** Average QoQ for the quarterly view is the average of the last quarter.

One-off Summary - Items above EBITDA only

Foreign Exchange rates used to support FX impact calculations in the above Organic Growth reconciliations

Earnings Release    Q4 2021

Reconciliation of Net financial obligations to EBITDA to Proportionate net financial obligations to EBITDA as of December 31, 2021

*Related to Guatemala acquisition completed on November 12, 2021.

Capex Reconciliation

Earnings Release    Q4 2021

Equity Free Cash Flow Reconciliation

OCF (EBITDA- Capex) Reconciliation

Earnings Release    Q4 2021

Interest Expense Reconciliation

Earnings Release    Q4 2021

Amortization Expense Detail

*Amortization expense related to joint ventures was $14 million in Q4 2021 and $115 million in FY 2021, and $34 million in Q4 2020 and $134 million in FY 2020. We began consolidating our Guatemala operations as of November 12, 2021.

Rebased Select Financial Indicators

In order to aid investors track the company's performance in future periods, the table that follows rebases a selection of 2021 full year financial indicators to reflect the full consolidation of Guatemala after our purchase of the minority interest on November 12, 2021, as well as the expected sale of our Tanzania business.

Earnings Release    Q4 2021

Joint Venture Financial Information (unaudited)

Until 2015, Millicom group results included Guatemala and Honduras on a 100% consolidation basis. Since 2016, these businesses are treated as joint ventures and are consolidated using the equity method. To aid investors to better track the evolution of the company’s performance over time, we provide the following indicative unaudited financial statement data for the Millicom group as if our Guatemala and Honduras joint ventures had been fully consolidated. Since acquiring the remaining 45% equity interest on November 12, 2021 we fully consolidate our Guatemala business in our consolidated financial statements.

Earnings Release    Q4 2021

* Millicom began consolidating our Guatemala operations as of November 12, 2021.

Earnings Release    Q4 2021

Earnings Release    Q4 2021

Earnings Release    Q4 2021

Proforma Financial Information

Since 2016, Millicom group results the Guatemala and Honduras businesses were treated as joint ventures and were consolidated using the equity method. On November 12, 2021, Millicom purchased the minority equity interest in Guatemala, and as of this date this operation is fully consolidated. To aid investors to better track the evolution of the company’s performance over time, we provide the following indicative unaudited financial statement data for the Millicom group as if our Guatemala had been fully consolidated.

Regulatory Statement

This information was prior to this release inside information and is information that Millicom is obliged to make public pursuant to the EU Market Abuse Regulation. This information was submitted for publication, through the agency of the contact person set out above, at 12:00 CET on February 11, 2022.

Item 2

Unaudited Interim Condensed Consolidated Financial Statements

For the three-month period and year ended December 31, 2021

February 11, 2022

Unaudited Interim Condensed Consolidated Financial Statements for the three- month period and year ended December 31, 2021

Unaudited interim condensed consolidated statement of income for the three-month period and year ended December 31, 2021

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements 

Unaudited Interim Condensed Consolidated Financial Statements for the three- month period and year ended December 31, 2021

Unaudited interim condensed consolidated statement of comprehensive income for the three-month period and year ended December 31, 2021

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements 

Unaudited Interim Condensed Consolidated Financial Statements for the three- month period and year ended December 31, 2021

Unaudited interim condensed consolidated statement of financial position as at December 31, 2021

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements 

Unaudited Interim Condensed Consolidated Financial Statements for the three- month period and year ended December 31, 2021

Unaudited interim condensed consolidated statement of financial position as at December 31, 2021 (continued)

The accompanying notes are an integral part of these unaudited interim condensed consolidated financial statements 

Unaudited Interim Condensed Consolidated Financial Statements for the three- month period and year ended December 31, 2021

Unaudited interim condensed consolidated statement of cash flows for the year ended December 31, 2021