VEON Ltd. · NASDAQ:VEON
VEON — Q1 2024 Earnings Presentation
43 slides from VEON's earnings presentation, May 16, 2024
Slide 1: 1Q24 Trading Update
VEON 1Q24 TRADING UPDATE ACCELERATING USD GROWTH STRONG OPERATIONAL EXECUTION 16 May 2024 1 1Q24 trading update|1
Slide 2: Agenda
AGENDA 1. OPENING Faisal Ghori 2. HIGHLIGHTS & BUSINESS UPDATE Kaan Terzioğlu 3. TRADING RESULTS – INCLUDING DEBT MATURITY AND LIQUIDITY UPDATE Joop Brakenhoff 4. CLOSING REMARKS Kaan Terzioğlu 5. Q&A Kaan Terzioğlu, Joop Brakenhoff 2 1Q24 trading update |2
Slide 3: Disclaimer
DISCLAIMER VEON's results and other financial information presented in this presentation are, unless otherwise stated, prepared in accordance with International Financial Reporting Standards ("IFRS") and have not been externally reviewed and audited. The financial information included in this presen
Slide 4: Notice to Readers: Financial Information Presented and Impact of the War in Ukraine
NOTICE TO READERS: FINANCIAL INFORMATION PRESENTED VEON's results and other financial information presented in this presentation are, unless otherwise stated, prepared in accordance with International Financial Reporting Standards ("IFRS") based on internal management reporting, are the responsibili
Slide 5: Agenda
AGENDA 1. OPENING Faisal Ghori 2. HIGHLIGHTS & BUSINESS UPDATE Kaan Terzioğlu 3. TRADING RESULTS – INCLUDING DEBT MATURITY AND LIQUIDITY UPDATE Joop Brakenhoff 4. CLOSING REMARKS Kaan Terzioğlu 5. Q&A Kaan Terzioğlu, Joop Brakenhoff 5 1Q24 trading update |5
Slide 6: VEON YoY USD and LCY Revenue Growth Performance
VEON YOY USD AND LCY REVENUE GROWTH PERFORMANCE Total revenue, YoY Total revenue, YoY in USD In local currency terms 20.5% 19.2% 15.0% 15.0% 16.0% 15.0% 16.4% 14.0% 11.6% 5.0% 6.6% 5.0% -0.6% -0.3% -1.5% -5.0% -2.4% -5.0% 2022 2023 1Q24 2022 2023 1Q24 VEON Group VEON Group VEON Group, other than Ukr
Slide 7: 1Q24 Highlights
1Q24 HIGHLIGHTS TOTAL SERVICE REVENUE REVENUE EBITDA $942mn $903mn $386mn +6.6% YoY +5.5% YoY +0.2% YoY +11.6% YoY +10.4% YoY +5.1% YoY local currency local currency local currency Solid reported currency YoY Strong uptake in Multiplay Inflationary pricing, effective growth. Other than Ukraine, segm
Slide 8: Q1 2024 Group Overview
Q1 2024 GROUP OVERVIEW Ukraine Pakistan Bangladesh USD LCY USD LCY USD LCY Service revenue Service revenue Service revenue -18.3% -14.6% +16.5% +25.7% +2.4% +6.2% EBITDA EBITDA EBITDA -29.6% -26.3% +17.8% +27.1% -12.6% -9.4% Kazakhstan Uzbekistan Kyrgyzstan USD LCY USD LCY USD LCY Service revenue Se
Slide 9: 4G Growth Driving Revenues
4G GROWTH DRIVING REVENUES Mobile customer base Steady growth in 4G Revenues from 4G users uptake drive top line growth 158mn subscribers A3M 4G users and penetration Multiplay and Doubleplay 4G (B2C) revenue (3 month active, million) (USD million) 135mn subscribers A1M Multiplay 2Play 4G 62% 56% 48
Slide 10: Ukraine Q1 2024
UKRAINE Q1 2024 Keeping Ukraine connected and investing $600mn in its future 1Q24 RESULTS AND YOY TRENDS SERVICE REVENUE AND 4G USERS AND MULTIPLAY AND DOUBLEPLAY YOY TRENDS PENETRATION 4G REVENUE (B2C)1 (UAH billion) (3 month active, million) (UAH billion) TOTAL SERVICE Multiplay 2Play 4G 61% REVEN
Slide 11: Helsi
HELSI The largest digital healthcare platform in Ukraine Users registered in the system 28 million +11% YoY Active healthcare institutions 1,600 +4% YoY Active doctors and specialists 38,000+ +14% YoY Appointments in 1Q24 2.5 million +33% YoY 11 1Q24 trading update|11
Slide 12: Pakistan Q1 2024
PAKISTAN Q1 2024 Revenue and EBITDA YoY growth in high twenties 1Q24 RESULTS AND YOY TRENDS SERVICE REVENUE AND 4G USERS AND MULTIPLAY AND DOUBLEPLAY YOY TRENDS PENETRATION 4G REVENUE (B2C) (PKR Billion) (3 month active, million) (PKR billion) TOTAL SERVICE +25.7% Multiplay 2Play 4G 64% REVENUE REVE
Slide 13: Digital Financial Services in Pakistan
DIGITAL FINANCIAL SERVICES IN PAKISTAN JazzCash and Mobilink Bank DFS 1Q24 RESULTS AND YOY TRENDS The most popular domestic mobile Pakistan’s largest domestic digital financial services app in Pakistan TOTAL bank with 45+ million customers REVENUE MAU 16.4bn Gross Loan Portfolio 17.2 million PKR PKR
Slide 14: Tamasha
TAMASHA Pakistan’s leading domestic entertainment platform MAU 12.0 million 2.1x YoY Guest users 35.3% +9.1 p.p. YoY Total # of sessions 303.4 million 2.5x YoY Pakistan Super League cricket: Ad Revenues PKR 130.9 million new revenue streams keep momentum ARPU Pakistan Digital Award 2023: PKR 544 Bes
Slide 15: Kazakhstan Q1 2024
KAZAKHSTAN Q1 2024 20%+ revenue and EBITDA growth, gaining market share 1Q24 RESULTS AND YOY TRENDS SERVICE REVENUE AND 4G USERS AND MULTIPLAY AND DOUBLEPLAY YOY TRENDS PENETRATION 4G REVENUE (B2C) (KZT Billion) (3 month active, million) (KZT billion) 76% Multiplay 2Play 4G TOTAL SERVICE +22.2% 66%
Slide 16: IZI
IZI Youth-focused mobile entertainment operator in Kazakhstan Entertainment platform Mobile operator The app offers a variety of With the highest NPS score in unique and new content Kazakhstan MAU Monthly active mobile customers 535,000 275,000 +61.6% YoY +55.1% YoY Guest users “I Join” NPS 35.9% 56
Slide 17: Bangladesh Q1 2024
BANGLADESH Q1 2024 YoY revenue growth for eleven consecutive quarters 1Q24 RESULTS AND YOY TRENDS SERVICE REVENUE AND 4G USERS AND MULTIPLAY AND DOUBLEPLAY YOY TRENDS PENETRATION 4G REVENUE (B2C) (BDT Billion) (3 month active, million) (BDT Billion) TOTAL SERVICE +18.0% +6.2% Multiplay 2Play 4G 52%
Slide 18: Toffee
TOFFEE The largest domestic mobile entertainment platform in Bangladesh MAU 9.2 million -21.2% YoY Guest users 68.4% -4.8p.p. YoY Total # of sessions 109.7 million -23.8% YoY Ad Revenues Exclusive BDT 6.1 million rights to ICC nation-wide ARPU streaming in Bangladesh BDT 310 2.9x higher than single
Slide 19: Uzbekistan Q1 2024
UZBEKISTAN Q1 2024 Revenue growth over 15% YoY and reached c.74% 4G user penetration 1Q24 RESULTS AND YOY TRENDS SERVICE REVENUE AND 4G USERS AND MULTIPLAY AND DOUBLEPLAY YOY TRENDS PENETRATION 4G REVENUE (B2C) (UZS Billion) (3 month active, million) (UZS billion) TOTAL SERVICE +15.1% 68% 74% Multip
Slide 20: DO1440 Flywheel Spinning Faster, Planting Future Growth
DO1440 FLYWHEEL SPINNING FASTER, PLANTING FUTURE GROWTH Our digital portfolio of assets as of 31 March 2024 Total digital MAU across all Total guest digital MAU LTM Gross Transaction Value LTM Total usage time, minutes services and platforms of our apps USD 25 billion 111 million 20 million +18% YoY
Slide 21: Agenda
AGENDA 1. OPENING Faisal Ghori 2. HIGHLIGHTS & BUSINESS UPDATE Kaan Terzioğlu 3. TRADING RESULTS – INCLUDING DEBT MATURITY AND LIQUIDITY UPDATE Joop Brakenhoff 4. CLOSING REMARKS Kaan Terzioğlu 5. Q&A Kaan Terzioğlu, Joop Brakenhoff 21 1Q24 trading update |21
Slide 22: Q1 2024 Revenues
Q1 2024 REVENUES REVENUE, FX DIFFERENCES IN 1Q24 (USD million) FX differences 1Q24 results YoY trends 67 14 (2) 141 188 TOTAL REVENUE 214 +11.6% Local currency 942 321 $942mn +6.6% Pakistan Kazakhstan Ukraine Bangladesh Uzbekistan Kyrgyzstan HQ and VEON SERVICE eliminations REVENUE Local currency +1
Slide 23: Q1 2024 EBITDA and EBITDA Margin
Q1 2024 EBITDA AND EBITDA MARGIN EBITDA, FX DIFFERENCES IN 1Q24 (USD million) FX differences 1Q24 results YoY trends 24 5 (44) 44 95 EBITDA 118 +5.1% Local currency 143 386 $386mn +0.2% Pakistan Kazakhstan Ukraine Bangladesh Uzbekistan Kyrgyzstan HQ and VEON eliminations Local currency +27.1% +27.8%
Slide 24: 1Q24 Debt and Liquidity Update
1Q24 DEBT AND LIQUIDITY UPDATE CASH • Group cash USD 632 million, excluding cash related to banking operations in Pakistan, of which USD 261 million at the HQ level as of 31 March 2024. • In addition to the USD 632 million, we also hold sovereign bonds of USD 215 million as of 31 March 2024 with ten
Slide 25: Debt Management Update
DEBT MANAGEMENT UPDATE AVERAGE COST OF DEBT (%) 22.0% 10.7% • Average cost of debt reflects blended rate of borrowings, mainly in USD, PKR and BDT. 8.1% • PKR debt, with average cost of 22.0%, accounted for c.20% of total 3.6% Group debt excl. leases in 1Q24. 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23
Slide 26: Agenda
AGENDA 1. OPENING Faisal Ghori 2. HIGHLIGHTS & BUSINESS UPDATE Kaan Terzioğlu 3. TRADING RESULTS – INCLUDING DEBT MATURITY AND LIQUIDITY UPDATE Joop Brakenhoff 4. CLOSING REMARKS Kaan Terzioğlu 5. Q&A Kaan Terzioğlu, Joop Brakenhoff 26 1Q24 trading update |26
Slide 27: 2024 Outlook: Continuing Our Growth Trajectory
2024 OUTLOOK Continuing our growth trajectory FY 2024 Guidance1 1Q 2024 Actual 1Q 2024 Normalized Total Revenue, YoY in local 16%-18% growth 12% growth 17% growth currency EBITDA, YoY in local 18%-20% growth 5% growth 17% growth currency LTM Capex intensity 18%-19% 18% 18% 27 1. Communicated with 4Q
Slide 28: Q&A
VEON 1Q24 TRADING UPDATE Q&A 28 1Q24 trading update |28
Slide 29: Thank You
VEON 1Q24 TRADING UPDATE THANK YOU! ir@veon.com Tel: +31 (0)20 79 77 200 29 1Q24 trading update |29
Slide 30: Appendix
VEON 1Q24 TRADING UPDATE APPENDIX 30 1Q24 trading update |30
Slide 31: Our Mobile Financial Services
OUR MOBILE FINANCIAL SERVICES Provide a broad portfolio of branchless banking services for customers JazzCash Simply Beepul Pakistan Kazakhstan Uzbekistan 1Q24 ACT YoY ACT YoY ACT YoY MAU (million) 17.2 17.7% 1.4 5.9x 0.3 -5.6% MAU app users (million) 10.3 65.4% 1.4 5.9x 0.3 -1.3% LTM Total transact
Slide 32: Our Entertainment Platforms
OUR ENTERTAINMENT PLATFORMS Offer new experiences and unique content to our customers Tamasha Toffee BeeTV Kyivstar TV Beeline TV IZI Pakistan Bangladesh Kazakhstan Ukraine Uzbekistan Kazakhstan 1Q24 ACT YoY ACT YoY ACT YoY ACT YoY ACT YoY ACT YoY MAU (million) 12.0 2.1x 9.2 -21.2% 0.9 22.0% 1.4 45.
Slide 33: Our Self-Service Platforms
OUR SELF-SERVICE PLATFORMS Transforming into super-apps My Kyivstar Simosa My Beeline MyBL My Beeline My Beeline Ukraine Pakistan Kazakhstan Bangladesh Uzbekistan Kyrgyzstan 1Q24 ACT YoY ACT YoY ACT YoY ACT YoY ACT YoY ACT YoY MAU (million) 4.2 17.3% 14.9 22.3% 4.4 9.2% 8.1 29.5% 5.1 14.4% 0.5 -18.3
Slide 34: Digital Operator Strategy Delivering Results
DIGITAL OPERATOR STRATEGY DELIVERING RESULTS Multiplay (B2C) segment ARPU Multiple Churn Impact 22% 26% 16% 3.9x 1.0x 3.3x 0.7x 0.5x 39% 49% 30% 1.0x 1Q22 1Q23 1Q24 Voice only 2play 4G Multiplay Voice only 2play 4G Multiplay Single play and no play revenue Double play revenue Multiplay revenue Healt
Slide 35: DO1440 Flywheel Spinning Faster, Planting Future Growth
DO1440 FLYWHEEL SPINNING FASTER, PLANTING FUTURE GROWTH Our digital portfolio of assets as of 30 April 2024 Total digital MAU across all Total guest digital MAU LTM Gross Transaction Value LTM Total usage time, minutes services and platforms of our apps USD 26 billion 70 billion 97.8 million 19 mill
Slide 36: Group Debt and Liquidity Currency Mix as of 31 March 2024
GROUP DEBT AND LIQUIDITY CURRENCY MIX AS OF 31 MARCH 2024 Gross debt Cash, cash Net debt AS OF 31 March 2024 Capitalised Gross debt excluding equivalents excluding USD equivalent, million leases leases and deposits leases USD 1,755 6 1,749 318 1,431 RUB 150 - 150 - 150 PKR 792 279 513 19 494 BDT 573
Slide 37: Outstanding Debt by Entity
OUTSTANDING DEBT BY ENTITY AS OF 31 MARCH 2024 (USD equivalent, million) Type of debt Total Overdrafts and Entity Bonds Loans outstanding vendor financing debt VEON Holdings B.V. 1,798 - - 1,798 Pakistan Mobile Communications Limited - 504 2 506 Banglalink Digital Communications Ltd. - 148 3 151 Oth
Slide 38: Debt Maturity as of 31 March 2024
DEBT MATURITY AS OF 31 MARCH 2024 DEBT MATURITY SCHEDULE AS OF 31 MARCH 2024 (USD billion) USD RUB PKR BDT OTHER 1.19 0.85 0.20 0.26 0.09 2024 2025 2026 2027 >2028 • In addition to total cash and cash equivalents of USD 632 million, we also hold sovereign bonds of USD 215 million as of 31 March 2024
Slide 39: Debt Maturity
DEBT MATURITY Debt maturity schedule 2024-2025 as of 31 March 2024 DEBT MATURITY SCHEDULE 2024-2025 (Millions) Maturity period Sep 2024 2024 other Feb 2025 Apr 2025 Jun 2025 Sep 2025 2025 other Outstanding debt, 22 70 23 556 100 35 138 USD equivalent Outstanding debt, PKR 6,027 MIX PKR 6,340 USD 556
Slide 40: Lease Liabilities (Principal)
LEASE LIABILITIES (PRINCIPAL) USD, million Local currency, million 31 March 2024 31 December 2023 31 March 2023 31 March 2024 31 December 2023 31 March 2023 Pakistan 279 254 197 77,629 71,644 55,735 Ukraine 174 174 161 6,831 6,599 5,872 Bangladesh 425 421 325 46,456 46,158 34,506 Kazakhstan 106 91 7
Slide 41: Reconciliation Tables
RECONCILIATION TABLES Extract from1Q24 trading update RECONCILIATION OF LOCAL CURRENCY NORMALISED, LOCAL CURRENCY AND REPORTED YOY GROWTH RATES - 1Q24 Total Revenue EBITDA LCY, normalised One-offs LCY FX and other Reported LCY, normalised One-offs LCY FX and other Reported Ukraine 6.8% (20.9%) (14.1
Slide 42: Reconciliation Tables
RECONCILIATION TABLES Extract from 1Q24 trading update RECONCILIATION OF NET DEBT USD million 31 Mar 2024 31 Dec 2023 30 Sep 2023 Net Debt, excluding banking operations in Pakistan 3,064 2,955 2,134 Cash and cash equivalents 832 1,902 2,249 Deposits in MMBL and JazzCash in Pakistan (200) (165) (62)
Slide 43: Definitions
DEFINITIONS 4G users are mobile customers who have engaged in revenue-generating activity during the three months prior to the measurement date as a result of activities over fourth-generation (4G or LTE – long term evolution) network technologies. Average revenue per user (“ARPU”) measures the mont