Veon reported a return to organic revenue and EBITDA growth in Q4 and said it targets a further increase in 2021. Quarterly revenues excluding currency effects rose 1.4 percent, and EBITDA was up 0.8 percent, led by strong growth in Ukraine and Kazakhstan. Veon said growth was supported by demand for data services and the addition of over 20 million 4G customers during the year.
On a reported basis, revenues fell 11.3 percent to USD 2.0 billion in Q4, and EBITDA dropped 11.6 percent to USD 826 million, hurt by negative forex effects. Annual results showed a similar performance, in line with Veon's forecast, with revenues down 10.0 percent to USD 8.0 billion, and EBITDA falling 18.1 percent to USD 3.5 billion.
Capital expenditure increased 8.5 percent over the year to USD 1.9 billion. Veon said it increased 4G coverage by 19 percent points to 73 percent, with the subsequent growth in 4G customers expected to lay the basis for future growth in revenues.
Veon ended 2020 with 80 million 4G customers, up by 5 million from September and by 20 million since 2019. The total subscriber base increased by 1.7 million in the quarter to 213.5 million. The growth was led by fixed subscribers, up 6.9 percent year-on-year to 4.4 million, while mobile customers dropped 1.6 percent over the 12 months to 209 million.
Mobile data revenues for the year rose 15.0 percent in local currency, to the equivalent of USD 2.6 billion, thanks to the higher 4G base and rising ARPUs.
While underlying free cash flow was down 61.8 percent over the year to USD 357 million, Veon managed to reduce its net debt slightly, to USD 6.1 billion. Leverage was within its targeted range at 2.3x EBITDA. The company confirmed it will not pay a dividend for the year.
For 2021, Veon expects capex at a similar level of 22-23 percent of revenues and leverage around 2.4x. Revenues and EBITDA are expected to show low to mid single-digit growth in local currency.
