Slide 1: Q3 2019 Results
Q3 2019 RESULTS AMSTERDAM 4 NOVEMBER 2019 ©VEON Ltd 2019
Slide 2: Disclaimer
DISCLAIMER This presentation contains “forward-looking statements”, as the phrase is defined in Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by words such as “ma
Slide 3: 3Q19 Achievements
3Q19 ACHIEVEMENTS POSITIONED FOR GROWTH 1 2 OPERATIONAL EXECUTION • 212 million customers, 65% data penetration • Good organic EBITDA growth • Offering local digital products (content, • Continued progress with cost intensity fintech, ecosystems) improvement across Group • Continued network investme
Slide 4: Solid Group Performance Year to Date
SOLID GROUP PERFORMANCE YEAR TO DATE CORNERSTONE GROWTH ENGINES FRONTIER MARKETS REVENUE USD 3,329 million REVENUE USD 2,192 million REVENUE USD 1,112 million EBITDA1 USD 1,239 million EBITDA1 USD 1,161 million EBITDA1 USD 414 million Capex excl. licenses1 Capex excl. licenses1 USD 376 million Capex
Slide 5: Expanding Digital Routes and Deploying New Services
EXPANDING DIGITAL ROUTES AND DEPLOYING NEW SERVICES 3Q19 results ECOSYSTEMS CONTENT FINANCIAL SERVICES (SELF-CARE APPS) (TV) (MFS2, DFS) MAU1 TV MAU1 Total MFS users Digital Wallets (million) (million) (million) (million) Total Group 16.0 Russia 8.9 Russia 1.8 Russia 4.7 Pakistan 2.6 Pakistan 0.6 Pa
Slide 6: Good Progress Year to Date
GOOD PROGRESS YEAR TO DATE TOTAL REVENUE EBITDA 9M 2019 EQUITY FREE CASH FLOW1 6,609 2,897 902 9M 2019 (PRE-IFRS 16) EXCL.LICENSES 9M 2019 (PRE-IFRS 16) +4.6% organic2 YoY +8.8 % organic2 YoY USD MILLION USD MILLION USD MILLION -3.3 % reported YoY +28.2 % reported YoY DATA REVENUE COST INTENSITY RAT
Slide 7: Monitor Certifies VEON's Compliance Program
MONITOR CERTIFIES VEON’S COMPLIANCE PROGRAM • Concludes Deferred Prosecution Agreement with the US Department of Justice • Marks the end of VEON’s external compliance monitorship • Highlights the strong progress we have made in building robust and sustainable compliance and controls programs A cultu
Slide 8: Good 3Q 2019 Results
GOOD 3Q 2019 RESULTS RE PORTED RE PORTED EQUITY FCF EXCL. $2.2bn $858m TOTA L R E V E N U E EBITDA LICENSES2 $567m -0.9% organic1 YoY (Pre-IFRS 16) +5.0% organic1 YoY (Pre-IFRS 16) • $54m $269m -4.0% reported YoY R E P O R T E D, RE PORTED $987m $370m (POST-IFRS 16) (POST-IFRS 16) +16.5% reported Yo
Slide 9: Revenue and EBITDA Development by Country
REVENUE AND EBITDA DEVELOPMENT BY COUNTRY Good operational performance in growth markets offset by weakness in Russia USD MILLION (-4.0%) YoY reported (31) (28) 33 (7) 5 (7) 14 (72) 2,317 2,296 2,223 1 Reported total Russia Pakistan Ukraine Uzbekistan Bangladesh Algeria Other Organic total FOREX Rep
Slide 10: Revenue and EBITDA Development by Product
REVENUE AND EBITDA DEVELOPMENT BY PRODUCT Data growth continues to drive revenue and EBITDA USD MILLION (-0.9%) YoY organic 9 (14) (107) (72) 90 2,317 2,296 2,223 1 Reported total Equipment & Voice Data and MFS Other Organic total revenue FOREX Reported total revenue accessories 3Q19 revenue 3Q18 3Q
Slide 11: Q3 2019 Income Statement
Q3 2019 INCOME STATEMENT USD MILLION Reported 3Q19 3Q18 Organic1 3Q19 pre-IFRS 16 versus 3Q18 reported 3Q19 YoY Pre-IFRS 16 Reported YoY Pre-IFRS 16 Revenue 2,223 2,223 2,317 (4.0%) (0.9%) Service revenue 2,076 2,076 2,151 (3.5%) (0.4%) EBITDA 987 858 848 1.3% 5.0% Depreciation, amortization and oth
Slide 12: Q3 2019 Net Debt Development
Q3 2019 NET DEBT DEVELOPMENT Stable net debt and gearing trends USD MILLION Includes second and final payment on the GTH tax settlement of USD 82.3 million. (2,094) 1,977 296 17 372 (90) 225 (858) (3) 100 131 8,179 8,252 6,085 6,275 Net debt IFRS 16 impact Net debt EBITDA Change in Financial Taxes C
Slide 13: Russia: Pressure on results, investing for the future
RUSSIA: Pressure on results, investing for the future TOTAL REVENUE EBITDA AND EBITDA MARGIN CAPEX EXCL. LICENSES AND LTM (RUB Billion) (RUB Billion and %) CAPEX/REVENUE (RUB Billion and %) -2.7 % YoY + 23.8% YoY + 3.5% YoY pre IFRS 16 + 19.0 YoY 76.7 72.6 74.7 -10.9% YoY 8.5 7.5 32.2 33.9 pre IFRS
Slide 14: Ukraine: Solid performance in a growing market
UKRAINE: Solid performance in a growing market TOTAL REVENUE EBITDA AND EBITDA MARGIN CAPEX EXCL. LICENSES AND LTM (UAH Billion) (UAH Billion and %) CAPEX/REVENUE (UAH Billion and %) + 18.3 % YoY + 33.1% YoY + 27.7% YoY pre IFRS 16 + 85.8% YoY 5.6 5.8 4.9 3.7 3.8 +61.8% YoY 3.6 1.4 0.3 0.3 pre IFRS
Slide 15: Pakistan: Double-digit revenue and EBITDA excl. regulatory changes
PAKISTAN: Double-digit revenue and EBITDA excl. impact of regulatory changes TOTAL REVENUE EBITDA AND EBITDA MARGIN CAPEX EXCL. LICENSES AND LTM (PKR Billion) (PKR Billion and %) CAPEX/REVENUE (PKR Billion and %) - 7.0 % YoY -6.1% YoY - 13.2% pre IFRS 16 +20.0 % YoY 48.9 51.1 +24.2% YoY 45.4 27.3 23
Slide 16: Uzbekistan: Stable performance excl. tax impact
UZBEKISTAN: Stable performance excl. tax impact in competitive environment TOTAL REVENUE EBITDA AND EBITDA MARGIN CAPEX EXCL. LICENSES AND LTM (UZS Billion) (UZS Billion and %) CAPEX/REVENUE (UZS Billion and %) -8.8% YoY +11.6% YoY + 8.1% YoY pre IFRS 16 -54.9% YoY 650.7 567.8 593.7 295.6 314.7 324.
Slide 17: Algeria: Outperforming in a challenging macro environment
ALGERIA: Outperforming in a challenging macro environment TOTAL REVENUE EBITDA AND EBITDA MARGIN CAPEX EXCL. LICENSES AND LTM (DZD Billion) (DZD Billion and %) CAPEX/REVENUE (DZD Billion and %) - 3.3% YoY -2.5 % YoY - 11.3% pre IFRS 16 + 40.2% YoY 24.4 22.3 23.6 +34.6 % 11.0 10.0 10.7 2.6 0.1 9.7 pr
Slide 18: Bangladesh: Good operational execution and continued turnaround
BANGLADESH: Good operational execution and continued turnaround TOTAL REVENUE EBITDA AND EBITDA MARGIN CAPEX EXCL. LICENSES AND LTM (BDT Billion) (BDT Billion and %) CAPEX/REVENUE (BDT Billion and %) +3.8% YoY +18.1% YoY -4.0% YoY pre IFRS16 +186.8% YoY 11.0 11.5 11.4 +162.9% 4.6 4.7 2.3 4.0 3.8 exc
Slide 19: 2019 Guidance Confirmed
2019 GUIDANCE CONFIRMED • Strong operating momentum in our Growth markets are providing an offset to weakness in Russia 9M FY 2019 • Returning Russia to growth is our key focus – 2019 GUIDANCE strengthening network performance, optimizing Low single-digit distribution and restoring pricing disciplin
Slide 20: Q&A
Q&A ©VEON Ltd 2019
Slide 21: Debt Currency Mix
DEBT CURRENCY MIX1 • At the end of Q3 2019, the balance of USD debt swapped to RUB is ~USD 1.2 billion • After balance sheet date, on 9 October 2019, VEON Holdings issued a USD 0.7 billion bond maturing 2025, the proceeds of which were used to repay all outstanding amounts under the RCF Q3 2018 GROU
Slide 22: Group Debt Maturity Schedule
GROUP DEBT MATURITY SCHEDULE1,2 HQ Pakistan Other GTH Russia Bangladesh 30 SEPTEMBER 2019 GROUP DEBT MATURITY SCHEDULE USD BILLION 2.0 1.5 1.2 1.3 0.9 0.5 0.1 2019 2020 2021 2022 2023 2024 >2024 GROUP DEBT MATURITY SCHEDULE BY CURRENCY – EXCLUDING LEASE LIABILITIES1 Currency breakdown 2019 2020 2021
Slide 23: Liquidity Overview
LIQUIDITY OVERVIEW GROUP CASH BREAKDOWN BY CURRENCY1 UNUSED RCF HEADROOM 30 September 2019 30 September 2019 12% Syndicated RCF facility USD 1.08 billion 5% USD PKR UNUSED CF HEADROOM 9% 30 September 2019 48% RUB UZS Pakistan – credit facilities PKR 41.6 billion (USD 0.27 billion) Other 16% Total ca
Slide 24: Debt by Entity
DEBT BY ENTITY1 30 SEPTEMBER 2019 USD MILLION Outstanding debt Type of debt Cash-pool Entity Bonds Loans Total overdrafts2 VEON Holdings B.V. 2,079 2,822 66 4,967 GTH Finance B.V. 1,200 - - 1,200 PJSC VimpelCom 279 - - 279 Pakistan Mobile Communications Limited 4 590 - 594 Banglalink Digital Communi
Slide 25: Regulatory Changes in Pakistan
REGULATORY CHANGES IN PAKISTAN • In June 2018, the Supreme Court ordered (“suo moto”) an interim suspension BREAKDOWN OF PAKISTANI RUPEE 100 BALANCE of the deduction of taxes and service/maintenance charges on prepaid and postpaid connections on each recharge/top-up/load levied by mobile phone servi
Slide 26: FOREX
FOREX Guidance rates Average rates Closing rates FY 2019 3Q19 3Q18 YoY 3Q19 3Q18 YoY Russian ruble 66.00 64.57 65.53 -1.5% 64.42 65.59 -1.8% Algerian dinar 119.00 119.78 118.01 1.5% 120.66 118.22 2.1% Pakistan rupee 139.00 158.57 123.69 28.2% 156.75 123.18 27.3% Bangladeshi taka 84.00 84.52 83.89 0.