Veon sees underlying growth improve despite negative forex effects

Thursday 8 November 2018 | 08:00 CET | News

Veon raised its full-year outlook, forecasting stronger growth in underlying revenue and EBITDA after a good third quarter. Reported results were still down in Q3 due mainly to negative currency effects, and the forex impact will also make its free cash flow target of USD 1 billion for the year "slightly challenging", the company said. 

Quarterly revenue fell 5.7 percent year on year to USD 2.32 billion, as organic growth of 2.9 percent and the acquisition of Euroset stores in Russia were offset by the currency weakness. The underlying revenue trend was supported by good growth in mobile data revenue, which increased 28.5 percent. EBITDA declined 18.7 percent to USD 848 million, as growth in Pakistan and Ukraine was offset by lower results in other countries. The EBITDA margin fell 5.9 percent points to 36.6 percent.

Net profit improved to USD 561 million from USD 134 million a year ago, supported by the one-time gain of USD 1.28 billion from selling the rest of Wind Tre to Hutchison. The profit was offset by RUB 0.6 billion of integration costs for Euroset and impairment charges of USD 451 million for Bangladesh and USD 125 million for Algeria on a weaker growth outlook in those countries. 

Veon reduced capex 21.4 percent year-on-year to USD 319 million in Q3, which it said was due to a more equal quarterly distribution of expenditures compared to last year. On a rolling 12-month basis, capex was at 16.8 percent of revenue, down 1.6 percentage points from Q3 2017. 

The fall in EBITDA led to a drop in operating cash flow, to USD 578 million from USD 834 million a year ago. Net debt was also lower, down 33.7 percent from June to USD 5.74 billion thanks to the proceeds from the Wind Tre deal. Leverage was at 1.7x, below the company's target of 2.0x.

For the full year, Veon updated its outlook to low single-digit organic revenue growth (from flat to low single-digit organic growth) and EBITDA growth in the low to mid-single digits (from flat to low single-digit organic growth). The equity free cash flow target remains at around USD 1 billion for 2018, but is "slightly challenged" by currency headwinds, the company said. In the first nine months, the figure was up 1.6 percent to USD 804 million. 

Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Categories: Mobile & Wireless
Companies: Veon
Countries: World
::: add a comment

Add comment

We welcome comments that add value to the discussion. We attempt to block comments that use offensive language or appear to be spam, and our editors frequently review the comments to ensure they are appropriate. If you see a comment that you believe is inappropriate to the discussion, you can bring it to our attention by using the report abuse links. As the comments are written and submitted by visitors of the Telecompaper website, they in no way represent the opinion of Telecompaper.


Last week in telecoms: sector slightly underperforms market, fibre joint ventures in focus

Published 12 Nov 2018 07:00 CET | Europe
The European telecoms sector slightly underperformed the general market in week 45. Our index ended the week up 0.3 percent, ...

Beeline revenues up, EBITDA down in Q3

Published 09 Nov 2018 10:50 CET | Russian Federation
Revenues of Russian operator Beeline, controlled by the Veon Group, grew by 5.8 percent year-on-year to RUB 76.750 billion in the ...

Jazz Q3 revenue jumps nearly 19% on mobile data business growth

Published 09 Nov 2018 07:30 CET | Pakistan
Pakistani operator Jazz saw its third-quarter revenue jump 18.7 percent year-on-year to PKR 48.9 billion. Around 6.3 percentage ...

Beeline Uzbekistan grows revenues 4% in Q3, EBITDA down 8%

Published 08 Nov 2018 17:17 CET | Uzbekistan
Revenues of the mobile operator Beeline Uzbekistan grew by 4.2 percent year-on-year to UZS 651 billion in the third quarter. ...

Kyivstar revenues up 14% in Q3

Published 08 Nov 2018 17:07 CET | Ukraine
Revenues of Ukrainian mobile operator Kyivstar grew by 14.1 percent year-on-year to UAH 4.925 billion in the third quarter. ...

Djezzy's service revenue decline eases to 5% in Q3

Published 08 Nov 2018 10:10 CET | Algeria
Veon reported third-quarter revenues of DZD 24.4 billion for its Djezzy subsidiary in Algeria, down 6.7 percent year-on-year ...

Veon completes sale of Wind Tre stake to CK Hutchison

Published 07 Sep 2018 11:18 CET | Italy
Veon has completed the sale its 50 percent stake in Italian operator Wind Tre to its partner CK Hutchison just a week after the ...

Calendar   /   Industry Events

29 Oct ITU Plenipotentiary Conference
12 Nov Gilat Satellite Networks Q3 2018
12 Nov Play Q3 2018
12 Nov Otello Q3 2018
12 Nov YY Q3 2018
12 Nov Aviat Networks fiscal Q1
12 Nov DC5G
13 Nov Telkom fiscal H1
13 Nov Vodafone Group fiscal Q2
13 Nov 1&1 Drillisch Q3 2018
13 Nov Asus Q3 2018
13 Nov United Internet Q3 2018
13 Nov Iliad Q3 2018
13 Nov Evolving Systems Q3 2018
13 Nov Extreme Networks financial conference
13 Nov AfricaCom
14 Nov Digi Communications Q3 2018
14 Nov Multimedia Polska Q3 2018
14 Nov TDC Q3 2018
14 Nov Blonder Tongue Q3 2018
14 Nov Cisco fiscal Q1
14 Nov ProSiebenSat.1 Capital markets day
14 Nov HbbTV Symposium
15 Nov Vivendi Q3 2018
15 Nov Bouygues Telecom Q3 2018
15 Nov Nvidia fiscal Q3
16 Nov Cognizant investor day
::: More Calendar Items