NuRAN WireLess (CSE: NUR) is a Canadian-based company specializing in telecommunications, meeting the growing demand for wireless network coverage from remote countries and regions. Involved in emerging African areas, the company has its card to play and become a significant player.

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NuRAN WireLess

NuRAN WireLess (CSE: NUR) provides telecommunication services to meet network coverage needs in remote regions. The company offers a new possibility for more than one billion people to communicate effectively over long distances. Talking with numbers, more than half of the world's population isn't connected to the internet. Another key metric, the Sub-Saharan African population is expected to double by 2050, totaling 2.2 billion. This data, combined with a 10.7% average annual mobile subscriber growth rate (data from 2014-2018), you might have guessed there is a growing need, and NuRAN could be well positioned to grab this augmenting market share.

NuRAN's telcos provide more power, are cheaper, and are more environmentally focused.

At first glance, you could think NuRAN's telcos can't compete because of lower revenues, as they generate half of a traditional telco cellular site. Besides, be aware that theirs cost 5x less and yield an EBITDA/CAPEX ratio of 3x higher.

NuRAN participated in the Africacom 2022 trade show, the most prominent digital infrastructure event in Africa focused on connecting the next billion and was awarded the Africa Tech Festival Connectivity Project of the Year Award for 2022. NuRAN was selected ahead of MTN, Ericsson, and Avanti, further highlighting the strength of its disruptive NaaS business model. NuRAN also entered into discussions with one of its current MNO partners on a mini-grid community pilot project.

The project connects village houses, schools, and other services to its telecom power infrastructure. The project is subject to entry into a definitive agreement between the parties.

On July 26, 2022, NuRAN announced its first signing following the GFA of the final 10-year NaaS contract with MTN Sudan Company Ltd. to deploy a minimum of 500 rural sites in Sudan. The agreement is estimated to generate approximately US $125 million in gross revenues over its life and will support 2G and 3G. The company expects to retain the ownership of the infrastructure beyond the 10 years providing site operations and maintenance services, and this continuing revenue generation significantly increases the value of the agreement to NuRAN and its shareholders.

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Share Structure/ Financials

NuRAN WireLess shared on November its financial statements for the nine months ending on September 30, 2022. Are all the key metrics green? Yes.

The company increased its revenue to the top $3.37M, an increase of 298% directly attributable to the increase in live Network as a Service mobile sites and delivery of 2G/3G core network in the Marshall Islands. The gross profit increased by 625% to reach $1.6M compared to $218k (2021). Net loss reduced by 20% to bottom at $8.3M.  

On July 12, 2022, the company announced that it had received final approval for the EUR 8,000,000 facility from a Development Financial Institution (DFI);

On July 12, 2022, the company announced the closing of a non-brokered private placement of convertible debentures with a strategic investor for aggregate gross proceeds of $2,000,000;

On October 6, 2022, the company announced that the European Investment Bank (EIB) formally approved its senior credit facility for a total of US$18,000,000. The approval is expected to trigger the release of an additional EUR 8,000,000 senior secured credit facility with a second DFI, for which final permission was already granted in July 2022. The combined proceeds are to be used for project expenditures relating to the installation of network infrastructure by NuRAN and the roll-out of up to 242 rural sites in Cameroon and 850 sites in the Democratic Republic of the Congo (DRC) and will be provided to NuRAN Wireless (Africa) Holding in Mauritius which owns the two subsidiaries. Drawdown is subject to entering into formal loan agreements and compliance with several customary closing conditions, including the company providing evidence of investing a minimum of USD$ 6,000,000 in Cameroon and DRC, which it has completed.

In October, the company signed a US $75M contract renewable every 5-year. The agreement will involve up to 1,000 sites with MTN Ivory Coast for the deployment of rural locations. With the addition of these sites, NuRAN topped 4,100+ under contract and is quickly approaching its goal of 10,000 sites within 5 years. The project is expected to support 2G and 3G with a variety of site categories to cover different population densities and coverage areas. Similar to the previously announced MTN Sudan and MTN Namibia agreements, NuRAN expects to retain the infrastructure's ownership after the contract's completion, which potentially increases the agreement's value substantively. Ownership of the infrastructure by NuRAN extends the potential for recurring revenue generation to over 25 years.

Bottom Line

NuRAN WireLess (CSE: NUR) strengthened its balance sheet and decreased its net loss while improving its revenues. The company is a reliable partner in Africa, and more should come. The recent 5-year agreement augments the company's legitimacy, and the stock price and market cap seem more than reasonable to get a stake in. Amongst many tech plays, NuRAN stands out and could become a clear winner in the long term.

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