TIDMHTWS

RNS Number : 0777T

Helios Towers PLC

22 March 2021

Helios Towers plc

(the "Company")

2020 Annual Report and Accounts and 2021 Notice of Annual General Meeting

In accordance with Listing Rule 9.6.1R and Disclosure and Transparency Rule ("DTR") 4.1.3R, the Company announces that the following documents have been posted and/or otherwise made available to shareholders:

   --    2020 Annual Report and Accounts 
   --    2020 Sustainable Business Report 
   --    2021 Notice of Annual General Meeting 
   --    Form of Proxy for the 2021 Annual General Meeting 

The above mentioned documents (except for the Form of Proxy) are available on the Company's website at www.heliostowers.com and will shortly be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism .

22 March 2021

LEI: 213800DGC7GS4XCHCU30

Identification Code: GB00BJVQC708

 
 Enquiries: 
 
 For investor enquiries    investorrelations@heliostowers.com 
 For media enquiries       Edward Bridges, Stephanie Ellis 
                           FTI Consulting LLP 
                           +44 (0)20 3727 1000 
 

Appendix

In compliance with DTR 6.3.5R, the information contained in this appendix is extracted from the 2020 Annual Report and Accounts and should be read in conjunction with the Company's 2020 Full Year Results Announcement for the year ended 31 December 2020 issued on 10 March 2021. Both documents are available at www.heliostowers.com/investors/results-reports-and-presentations/ and together constitute the material required by DTR 6.3.5R to be communicated to the media in unedited full text through a Regulatory Information Service. This material is not a substitute for reading the 2020 Annual Report and Accounts in full. Page numbers and cross references in the extracted information refer to page numbers and cross references in the 2020 Annual Report and Accounts.

   1.      Business principal risks 

Summarised below are the key risks identified (not in order of significance) which could have a material impact on the Group.

 
Risk status  Risk description     Impacts             Risk mitigation 
No change    1. Operational       Strategic 
             resilience           Reputational              *    Ongoing enhancements to data security and protection 
                                  Operational                    measures with third-party expert support; 
             The ability of the 
             Group to continue 
             operations is                                  *    Additional investment in IT resource and 
             heavily reliant on                                  infrastructure to increase automation and workflow of 
             third parties, the                                  business as usual activities; 
             proper 
             functioning of its 
             technology                                     *    Third-party due diligence, ongoing monitoring and 
             platforms and the                                   regular supplier performance reviews; 
             capacity of its 
             available human 
             resources.                                     *    Alternative sources of supply are identified in 
             Failure in any of                                   advance to mitigate any potential disruption to the 
             these three areas                                   strategic supply chain; 
             could severely 
             affect its 
             operational                                    *    Ongoing review and involvement of the human resources 
             capabilities and                                    department at an early stage in organisation design 
             ability to deliver                                  and development activities. 
             on its strategic 
             objectives. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    2. Major quality     Reputational 
             failure or breach    Financial                 *    Continued skills development and training programmes 
             of contract                                         for the project and operational delivery team; 
 
             The Group's 
             reputation and                                 *    Detailed and defined project scoping and life cycle 
             profitability                                       management through project delivery and transfer to 
             could be damaged                                    ongoing operations; 
             if it fails to 
             meet its 
             customers'                                     *    Contract and dispute management processes in place; 
             operational 
             specifications, 
             quality standards                              *    Continuous monitoring and management of customer 
             or delivery                                         relationships; 
             schedules. 
 
             A substantial                                  *    Use of long-term contracting with minimal termination 
             portion of Group                                    rights. 
             revenues is 
             generated from a 
             limited number of 
             large customers. 
             The loss of any of 
             these customers 
             would materially 
             affect the Group's 
             finances and 
             growth 
             prospects. 
 
             Many of the 
             Group's customer 
             tower contracts 
             contain liquidated 
             damage provisions, 
             which may 
             require the Group 
             to make 
             unanticipated and 
             potentially 
             significant 
             payments to its 
             customers. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    3. Non-compliance    Compliance 
             with various laws    Financial                 *    Constant monitoring of potential changes to laws and 
             and regulations      Reputational                   regulatory requirements; 
             such as: 
 
             i) Health, safety                              *    In-person and virtual training on health, safety and 
             and environmental                                   environmental matters provided to employees and 
             laws                                                relevant third-party contractors; 
 
             ii)Anti-bribery 
             and corruption                                 *    I S O 3 7 0 0 1 ( A n t i - B r i b e r y M ana g e m 
             provisions                                          e n t S y s t e m ) c e r t i fi c a t i o n 
                                                                 retained; 
             Non-compliance 
             with applicable 
             laws and                                       *    Ongoing refresh of compliance and related policies i 
             regulations may                                     m p l e m e n t e d i n 2018 , i n c l u d i n g s p 
             lead to                                             e c i fi c d e t a il s c o v e r i n g Anti-Bribery 
             substantial fines                                   and Corruption, Facilitation of Tax Evasion, 
             and penalties,                                      Anti-Money-Laundering; 
             reputational 
             damage and adverse 
             effects on future                              *    Compliance monitoring activities and periodic 
             growth prospects.                                   reporting requirements introduced; 
 
             Sudden and 
             frequent changes                               *    Ongoing engagement with external lawyers, consultants 
             in laws and                                   , 
             regulations, in                                     and regulatory authorities, as necessary, to identify 
             respect of their                                    and assess changes in the regulatory environment; 
             interpretation or 
             application and 
             enforcement, both                              *    Third-Party Code of Conduct communicated and annual 
             locally and                                         certifications required of all high and medium risk 
             internationally,                                    third parties introduced and communicated; 
             may require the 
             Group to modify 
             its existing                                   *    Third-party monitoring through supplier audits and 
             business                                            performance reviews. 
             practices, incur 
             increased costs 
             and subject it to 
             potential 
             additional 
             liabilities. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    4. Economic and      Operational 
             political            Financial                 *    Ongoing market analysis and business intelligence 
             instability                                         gathering activities; 
 
             A slowdown in the 
             growth of, or a                                *    Market share growth strategy in place; 
             reduction in 
             demand for, 
             wireless                                       *    Long-term contracts with blue chip MNOs; 
             communication 
             services 
             could adversely                                *    Close monitoring of any potential risks that may 
             affect the demand                                   affect operations; 
             for communication 
             sites and tower 
             space, and could                               *    Business continuity and contingency plans in place to 
             have                                                respond to any emergency situations. 
             a material adverse 
             effect on the 
             Group's financial 
             condition and 
             results of 
             operations. 
 
             There are 
             significant risks 
             related to 
             political 
             instability, 
             security, ethnic, 
             religious 
             and regional 
             tensions in each 
             geography where 
             the Group has 
             operations. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    5. Significant       Financial 
             exchange rate                                   *    USD and EUR pegged contracts; 
             movements 
 
             Fluctuations in,                                *    'Natural' hedge of local currencies (revenue vs. 
             or devaluations                                      opex); 
             of, local market 
             currencies where 
             the Group operates                              *    Monthly review of exchange rate differences. 
             could 
             have a significant 
             and negative 
             financial impact 
             on the Group's 
             business, 
             financial 
             condition 
             and results. Such 
             impacts may also 
             result from any 
             adverse effects 
             that these 
             movements have 
             on Group 
             third-party 
             customers and 
             strategic 
             suppliers. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    6. Non-compliance    Operational 
             with permit                                    *    Inventory of required licences and permits maintained 
             requirements                                        for each operating company; 
 
             The Group may not 
             always operate                                 *    Compliance registers maintained with any potential 
             with the necessary                                  non-conformities identified by relevant government 
             required approvals                                  authorities with a timetable for rectification; 
             and permits for 
             some 
             of its tower                                   *    Periodic engagement with external lawyers and 
             sites,                                              advisors, and participation in industry groups; 
             particularly in 
             the case of tower 
             portfolios                                     *    Active and ongoing engagement with relevant 
             acquired from a                                     regulatory authorities to proactively identify, 
             third-party.                                        assess and manage actual and potential regulation 
             Vagueness,                                          changes. 
             uncertainty and 
             changes in 
             interpretation of 
             regulatory 
             requirements are 
             frequent 
             and often arise 
             without warning. 
             As a result, the 
             Group may be 
             subject to 
             potential 
             reprimands, 
             warnings, fines 
             and penalties for 
             non-compliance 
             with the relevant 
             permitting and 
             approval 
             requirements. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    7. Loss of key       People 
             personnel                                       *    Talent identification and succession planning are in 
                                                                  place for key roles; 
             The Group's 
             successful 
             operational                                     *    Competitively benchmarked performance-related 
             activities and                                       remuneration plans; 
             growth are closely 
             linked to the 
             knowledge                                       *    Staff performance and development/support plans. 
             and experience of 
             key members of 
             senior management 
             and highly skilled 
             technical 
             employees. 
             The loss of any 
             such personnel, or 
             the failure to 
             attract, recruit 
             and retain equally 
             high-calibre 
             professionals, 
             could adversely 
             affect the Group's 
             operations, 
             financial 
             condition and 
             strategic 
             growth prospects. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    8. Technology risk   Strategic 
                                                             *    Strategic long-term planning; 
             Advances in 
             technology that 
             enhance the                                     *    Business intelligence; 
             efficiency of 
             wireless networks, 
             and potential                                   *    Exploring alternative technologies such as solar 
             active                                               power; 
             sharing of 
             wireless spectrum, 
             may significantly                               *    Continuously improving our product offering to adapt 
             reduce or negate                                     to new wireless technologies; 
             the need for 
             tower-based 
             infrastructure or                               *    Applying for new licenses to provide active 
             services. This                                       infrastructure services in certain markets. 
             could reduce the 
             need for 
             telecommunications 
             operators to 
             add more 
             tower-based 
             antenna equipment 
             at certain tower 
             sites, leading to 
             a potential 
             decline 
             in tenancies, 
             service needs and 
             revenue streams. 
 
             Examples may 
             include spectrally 
             efficient 
             technologies, 
             which could 
             potentially 
             relieve certain 
             network capacity 
             problems, or 
             complementary 
             voice over 
             internet protocol 
             access 
             technologies 
             that could absorb 
             a portion of 
             subscriber traffic 
             from the 
             traditional 
             tower-based 
             networks. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    9. Failure to        Financial 
             remain competitive                              *    Key performance indicator ('KPI') monitoring and 
                                                                  benchmarking against competitors; 
             Competition in, or 
             consolidation of, 
             the                                             *    Total cost of ownership analysis for MNOs; 
             telecommunications 
             tower industry may 
             create pricing                                  *    Fair pricing structure; 
             pressures that 
             materially and 
             adversely affect                                *    Business intelligence and review of competitors' 
             the Group.                                           activities; 
 
 
                                                             *    Strong tendering team to ensure high win/retention 
                                                                  rate; 
 
 
                                                             *    Continuous capex investment to ensure that the Group 
                                                                  has sufficient capacity. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    10. Failure to       Strategic 
             integrate new        Financial                 *    Pre-acquisition due diligence conducted with the 
             lines of business    Operational                    assistance of external advisors with specific 
             in new markets                                      geographic and industry expertise; 
 
             Multiple risks 
             exist with entry                               *    Ongoing monitoring activities 
             into new markets                                    post-acquisition/agreement; 
             and new lines of 
             business. Failure 
             to successfully                                *    Detailed management, operations and technology 
             manage and                                          integration plan; 
             integrate 
             operations, 
             resources and                                  *    Ongoing measurement of performance vs. plan and Group 
             technology could                                    strategic objectives; 
             have material 
             adverse 
             implications                                   *    Implementation of a regional CEO and support function 
             for the Group's                                     to governance and oversight structure. 
             overall growth 
             strategy, and 
             negatively impact 
             its financial 
             position and 
             corporate culture. 
             ------------------  ------------------  ----------------------------------------------------------------- 
No change    11. Tax disputes     Compliance 
                                  Financial                  *    Frequent interaction and transparent communication 
             Our operations are   Operational                     with relevant governmental authorities and 
             based in certain     Reputational                    representatives; 
             countries with 
             complex, 
             frequently                                      *    Engagement of external legal and tax consultants to 
             changing and                                         advise on legislative/tax code changes and assessed 
             bureaucratic                                         liabilities or audits; 
             and 
             administratively 
             burdensome tax                                  *    Engagement with trade associations and industry 
             regimes. This may                                    bodies and other international companies and 
             lead to                                              organisations facing similar issues; 
             significant 
             disputes around 
             interpretation and                              *    Defending against unwarranted claims; 
             application of tax 
             rules and may 
             expose us to                                    *    Recruitment of Group Tax Manager, and ongoing 
             significant                                          recruitment of in-house tax expertise at both Group 
             additional                                           and Opco levels. 
             taxation 
             liabilities. 
             ------------------  ------------------  ----------------------------------------------------------------- 
New          12. Covid-19         Financial 
                                  Operational                *    Health and safety protocols established and 
             In addition to the                                   implemented; 
             normal health and 
             safety risks to 
             our employees and                               *    Business continuity plans implemented with ongoing 
             contractors, the                                     monitoring; 
             ongoing 
             impact of the C o 
             v i d-19 p an d e                               *    Financial modelling, scenario building and stress 
             m i c c o u l d m                                    testing; 
             a t e r i a ll y 
             an d a d v e rs e 
             l                                               *    Continuous monitoring of the external environment; 
             y a ff e c t the 
             financial and 
             operational                                     *    Increased fuel and capex purchases; 
             performance of the 
             Group across all 
             its activities.                                 *    Review of contractual terms and conditions; 
             The effects of the 
             pandemic may also 
             disrupt the                                     *    Review and adaptation of our control environment for 
             achievement of the                                   remote working. 
             Group's strategic 
             plans 
             and growth 
             objectives and 
             place additional 
             strain on its 
             technology 
             infrastructure. 
             There 
             is also an 
             increased risk of 
             litigation due to 
             the potential 
             effects of the 
             pandemic on 
             fulfilment 
             of contractual 
             obligations. 
             ------------------  ------------------  ----------------------------------------------------------------- 
New          13. Information      Financial 
             technology failure   Operational               *    Ongoing implementation and enhancement of security 
             and cyber-attack     Reputational                   and remote access processes, policies and procedures; 
             risk 
 
             We are                                         *    Regular security testing regime established, 
             increasingly                                        validated by independent third parties; 
             dependent on the 
             performance and 
             effectiveness of                               *    Annual staff training and awareness programme in 
             our IT systems.                                     place; 
             Failure 
             of our key 
             systems, exposure                              *    Security controls based on industry best practice 
             to the increasing                                   frameworks such as NCSC, and validated through 
             threat of                                           internal audit assessments; 
             cybercrime attacks 
             and threats, loss 
             or theft of                                    *    Specialist security third parties engaged to assess 
             sensitive                                           cyber risks and mitigation plans; 
             information, 
             whether 
             accidentally or                                *    Incident management and response processes aligned to 
             intentionally,                                      In f or ma t i on T e c hn o l ogy In f r a s t ruc t 
             expose the Group                                    u r e L i b r ar y ( ' I T I L (R) ' ) b es t 
             to operational,                                     practice - identification, containment, eradication, 
             strategic,                                          recovery and lessons learned; 
             reputational and 
             financial risks. 
             These risks are                                *    New supplier risk management assessments and due 
             increasing due                                      diligence carried out. 
             to greater 
             interconnectivity, 
             reliance on 
             technology 
             solutions to drive 
             business 
             performance, 
             use of third 
             parties in 
             operational 
             activities and 
             continued adoption 
             of remote working 
             practices. 
 
             Cyber-attacks are 
             becoming more 
             sophisticated and 
             frequent and may 
             compromise 
             sensitive 
             information 
             of the Group, its 
             employees, 
             customers or other 
             third parties. 
             Failure to prevent 
             unauthorised 
             access or to 
             update processes 
             and IT security 
             measures may 
             expose the Group 
             to potential 
             fraud, 
             inability to 
             conduct its 
             business, damage 
             to customers as 
             well as regulatory 
             investigations 
             and associated 
             fines and 
             penalties. 
             ------------------  ------------------  ----------------------------------------------------------------- 
 
   2.            Related party transactions 

During the year, the Group companies entered into the following commercial transactions with related parties:

 
                                                     2020                     2019 
                                            -----------------------  ----------------------- 
                                                           Purchase                 Purchase 
                                             Income from   of goods   Income from   of goods 
                                             towers US$m       US$m   towers US$m       US$m 
------------------------------------------  ------------  ---------  ------------  --------- 
Millicom Holding B.V. and subsidiaries(1)           72.2          -          70.4          - 
Ecost Building Management Pty                          -          -             -        1.4 
Vulatel (Pty) Ltd                                      -          -           0.2        0.3 
Nepic Pty                                              -        0.2           0.3          - 
------------------------------------------  ------------  ---------  ------------  --------- 
Total                                               72.2        0.2          70.9        1.7 
------------------------------------------  ------------  ---------  ------------  --------- 
 
 
                                                   2020                2019 
                                            ------------------  ------------------ 
                                              Amount    Amount    Amount    Amount 
                                             owed by   owed to   owed by   owed to 
                                                US$m      US$m      US$m      US$m 
------------------------------------------  --------  --------  --------  -------- 
Millicom Holding B.V. and subsidiaries(1)       37.1         -      22.9         - 
Vulatel (Pty) Ltd(2)                               -         -       0.2         - 
Nepic Pty(2)                                       -         -       0.3       0.1 
SA Towers Proprietary Limited(2)                   -         -         -       1.5 
------------------------------------------  --------  --------  --------  -------- 
Total                                           37.1         -      23.4       1.6 
------------------------------------------  --------  --------  --------  -------- 
 
   (1)          Millicom Holding B.V is a shareholder of Helios Towers plc. 

(2) No longer classified as related parties as of November 2020. See Note 13 for further details.

The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. Based on the ECL model, no provisions have been made for loss allowances in respect of the amounts owed by related parties.

Amounts receivable from the related parties related to other Group companies are short term and carry interest varying from 0% to 15% per annum charged on the outstanding trade and other receivable balances (Note 15).

   3.            Statement of Directors' Responsibilities 

The Directors are responsible for preparing the Annual Report and Financial Statements, and the Group's Financial Statements, in accordance with applicable United Kingdom law and those applicable accounting standards.

The Directors have elected to prepare the Company Financial Statements in accordance with United Kingdom Generally Accepted Accounting Practice ('UK GAAP'), which is the United Kingdom Accounting Standards and applicable law, including the Financial Reporting Standard Applicable in the UK and Republic of Ireland ('FRS 102').

The Directors are required to prepare Financial Statements for each financial year which present a true and fair view of the financial position of the Company and of the Group, and of the financial performance and cash flows of the Group. In preparing those Financial Statements, the Directors are required to:

-- select suitable accounting policies in accordance with IAS 8 ('Accounting policies, changes in accounting estimates and errors') and FRS 102 then apply them consistently;

-- present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

-- provide additional disclosures when compliance with the specific requirements in IFRS for Group and FRS 102 for Company is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Company and of the Group's financial position and financial performance;

-- state that the Company has complied with FRS 102 and the Group has complied with IFRS, subject to any material departures disclosed and explained in the Financial Statements; and

-- prepare the accounts on a going concern basis unless, having assessed the ability of the Company and the Group to continue as a going concern, management either intends to liquidate the entity or to cease trading, or have no realistic alternative but to do so.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and of the Group, and which enable them to ensure that the Financial Statements comply with the Companies Act 2006 and Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of the Company and the Group, and hence for taking reasonable steps for

the prevention and detection   of   fraud   and  other irregularities. 

Under applicable UK law and regulations, the Directors are responsible for the preparation of a Directors' report, Directors' remuneration report and corporate Governance Report that comply with that law and regulations. In addition, the Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the UK governing the preparation and

dissemination of Financial Statements may differ from  legislation   in   other   jurisdictions. 

Neither the Company nor the Directors accept any liability to any person in relation to the Annual Report and Financial Statements except to the extent that such liability could arise under English law. Accordingly, any liability to a person who has demonstrated reliance on any untrue or misleading statement or omission shall be determined in accordance with section 90A a nd s c h e d u le 10A of t he F i n a n c i al Services

and   Markets   Act   2000. 

Directors' responsibility statement under the UK Corporate Governance Code:

In accordance with Provision 27 of the 2018 UK C o r po r a te Go v e r n a n ce C od e, the Directors consider that the Annual Report and Financial Statements, taken as a whole, is fair, balanced and understandable and provides information to enable shareholders to assess the Company's performance, business model and strategy.

Responsibility statement of the Directors in respect of the Annual Report and Financial Statements Each of the Directors whose names are listed on pages 72-74 confirm that to t he b e st of t h e ir k n o w l e dg e:

a) the Group Financial Statements, prepared in accordance with International Financial Reporting Standards as adopted by the European Union, and the Company Financial Statements prepared u n d er F RS 102, g i ve a t r ue a nd f a ir view of the assets, liabilities, financial position and profit and loss of the Group and Company and the undertakings included in the consolidation taken as a whole; and

b) the management report (encompassed within the Overview, Strategic Report, and Governance sections) includes a fair review of the development and performance of the business, and the position of the Group and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

The Strategic Report and the Statement of Directors' Responsibilities were approved by the Board and signed on its behalf by the Chief Executive Officer.

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March 22, 2021 10:23 ET (14:23 GMT)