Ooredoo Group revenue rises by 2% to QR23.2bn, net profit up by 28%

Ooredoo Group revenue rises by 2% to QR23.2bn, net profit up by 28%

QLNews
By QLNews

Ooredoo, Qatar’s leading telecommunications company, announced its financial results for the year ending December 31, 2023, on Tuesday.

The group’s revenue grew by 2% year-on-year (YoY) to QR23.2bn (QR22.7bn in 2022), ahead of its FY 23 guidance target.

The improvement was driven by sustained growth in Iraq, Algeria, Kuwait, and the Maldives. It was also partially offset by a decline in Revenue in Qatar, Tunisia, Myanmar, and Palestine (due to foreign exchange depreciation).

While Ooredoo’s net profit increased 28% YoY to QR3bn (QR2.4bn in 2022), the normalized net profit grew by 16% YoY to reach QR3.3bn from QR2.8bn in FY 2022.

Normalized net profit is the net profit adjusted for foreign exchange, impairments, and exceptional items (QR446m gain from NMTC legal case, Meeza IPO gain of QR139m, QR56m gain on disposal of towers, and QR37m gain on data center carve out in Indonesia).

Commenting on the results, Ooredoo Chairman Sheikh Faisal bin Thani Al Thani said: “Ooredoo strives to enhance people’s digital lives and deliver value to its stakeholders. In 2023, we continued to provide best-in-class connectivity and deliver superior customer experience by investing in our capabilities and infrastructure. Revenue grew by 2% to QR23.2bn while reported net profit increased by a healthy 28% to QR3bn, a historical high.”

“I’m pleased to announce that the Board of Directors will recommend a cash dividend distribution of QR0.55 per share, in line with our sustainable and progressive dividend policy, at the Annual General Meeting in March.

Our success is facilitated by our ongoing digital transformation, which not only contributes to our resilience, but also empowers us to capitalize on market opportunities and position ourselves for long-term sustainable growth. Our adaptability in navigating a dynamic market landscape ensures sustained success and attractive returns.

“Looking forward, we remain dedicated to our strategic path that unlocks capital and enhances value for our stakeholders, solidifying our position as an industry leader,” he said.

Also commenting on the results, Aziz Aluthman Fakhroo, Managing Director and CEO of Ooredoo Group said: “2023 was a noteworthy year. We improved our financial position and made substantial progress against our strategic priorities.

“We delivered financial results in line with our full-year 2023 guidance. Revenue grew by 2% to QR23.2bn. EBITDA increased by 4% to QR9.7bn, and the EBITDA margin expanded by 1pp to 42%, supported by top-line growth and a disciplined approach to costs. Solid performances in Iraq, Kuwait, Algeria, and Maldives drove the year’s growth.

“The Group achieved an all-time high reported Net Profit of QR3bn, up by 28%, and strong normalized FCF generation of QR6.8bn, up 6%. We announced the establishment of the region’s largest independent tower company in partnership with Zain and TASC at a $2.2bn valuation, marking a significant milestone. These accomplishments are the result of teamwork, and I’m immensely proud of my colleagues’ dedication.

“As we look ahead, we’ll continue to drive operational efficiency for profitability and cash generation while advancing our strategic priorities as we evolve toward becoming the leading digital infrastructure provider in the region,” said Fakhroo.

Ooredoo’s focus on profitability led to an EBITDA of QR9.7bn, up by 4% YoY.

Group CAPEX spend was at QR2.8bn for FY 2023, reflecting a 3% YoY growth. Normalized Free Cash Flow increased by 6% YoY to QR6.8bn supported by EBITDA expansion. Solid performances in Iraq, Kuwait, Algeria, and Maldives contributed positively to additional FCF generation in the year.

The divided of QR0.55 per share represents an increase of 28% YoY and a payout of 59% of normalized earnings and is in line with the dividend policy.

Ooredoo Qatar increased its customer base by 2% YoY (excluding the FIFA 2022 connections) to 3 million despite a challenging operating environment (softer economic activity and increased competition in the mobile segment).

Qatar delivered revenue of QR7,286m in 2023 (2022: QR7,960m). On a reported basis, this reflects an 8% decrease YoY as the FY 2022 base was bolstered by the World Cup.

During the year, the operation decided to scale down the low-margin wholesale business and carved-out Ooredoo Financial Services. On a like-for-like basis excluding the FIFA impact, revenue remained flat.

EBITDA decreased by 6% YoY to QR3,603m due to a higher comparison base and one-off impacts. Normalizing for the aforementioned items as well as one-off provisions, EBITDA declined by 1% YoY.

The operation sustained a solid EBITDA margin of 49%, up by 1pp YoY.

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