VEON (VEON) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached $1,038 million, up 9.8% year-over-year in USD and 14.1% in local currency, driven by digital, multiplay, and strong growth in Pakistan and Kazakhstan.

• Direct digital revenue surged 35.1% year-over-year to $121 million, now 12% of total revenue, with 103 million digital monthly active users and 99.9 million 4G users.

• EBITDA was $438 million, down 1.5% year-over-year in USD but up 3.5% in local currency, impacted by one-off items in Bangladesh and HQ restructuring.

• CapEx increased 51.2% year-over-year to $198 million, with LTM capex intensity at 19.2% due to resumed equipment imports and network expansion.

• Cash position at quarter-end was $1,019 million, with gross debt at $3.99 billion and net debt/EBITDA at 1.5x.

Financial highlights

• Telecom and infrastructure revenue was $916 million (+7.2% YoY in USD, +12.2% in local currency); direct digital revenue up 35.1% in USD.

• EBITDA margin was 42.2%, down 4.9 percentage points year-over-year.

• Net dividends upstreamed from OpCos reached $396 million in the first nine months.

• Equity free cash flow for Q3 was $142 million, down from $179 million a year ago; LTM equity FCF up 22.2% YoY.

• Average cost of debt was 12.1%; average debt maturity 2.7 years (3.3 years including leases).

Outlook and guidance

• Full-year 2024 revenue growth expected at 8–10% in USD and 12–14% in local currency; EBITDA growth forecast at 4–6% in USD and 9–11% in local currency.

• Underlying local currency growth expected at 15–16% for revenue and 10–11% for EBITDA.

• Guidance revised down from previous 16–18% revenue and 18–20% EBITDA growth due to lower inflation, Bangladesh unrest, and Kazakhstan asset sale.

• LTM capex intensity expected at 18–19%.