S&P Global Upgrades Axian Telecom’s Business Risk Profile Amid Improved Country Conditions
The ratings agency revised its country risk assessments for Tanzania and Togo from "very high" (6) to "high" (5) in early 2025, citing stronger economic growth, improved business environments, and supportive infrastructure investments.
S&P Global Ratings has upgraded Axian Telecom’s business risk profile from “vulnerable” to “fair,” reflecting enhanced economic conditions in two of its key markets, Tanzania and Togo. The ratings agency revised its country risk assessments for Tanzania and Togo from “very high” (6) to “high” (5) in early 2025, citing stronger economic growth, improved business environments, and supportive infrastructure investments.
Axian Telecom, which operates in eight African countries, derives approximately 55% of its EBITDA from Tanzania and Togo. The company’s performance has surged, with its subscriber base reaching 40.2 million and annual revenue hitting $1.4 billion by the end of 2024, nearly doubling since 2021. S&P highlighted Axian’s strong EBITDA margins of 45%-47%, which outperform regional peers, as a key factor in its positive reassessment.
The ratings agency expects Axian Telecom to maintain strong financial performance, with projected free operating cash flow (FOCF) rising from $42 million in 2024 to $148 million in 2025 and $249 million in 2026. This growth is supported by efficient operations, a robust core market presence, and a strategic focus on organic expansion rather than debt-funded acquisitions.
S&P forecasts a steady decline in Axian’s leverage, with debt-to-EBITDA expected to improve from 3.2x in 2023 to around 1.8x in 2026, reflecting the company’s focus on cash generation and prudent capital management. The company’s capital expenditures are also set to decrease from $380 million in 2025 to $318 million in 2026, further supporting its financial resilience.
The stable outlook reflects a balance between Axian Telecom’s improving financial metrics and ongoing sovereign risks in its main markets. S&P warned that any resurgence in debt-funded acquisitions or a decline in operating performance could trigger a downgrade. Conversely, sustained positive cash flow, reduced leverage, and continued focus on organic growth could further enhance Axian’s credit profile.
