Typography
  • Smaller Small Medium Big Bigger
  • Default Helvetica Segoe Georgia Times

During the past year, Telecom Egypt's consolidated revenue grew significantly, reaching EGP 42.0bn, a 30% YoY increase. This growth was driven by a nearly doubled year-on-year IDD revenue of EGP 4.3bn, thanks to increased traffic and USD appreciation.

Additionally, cable revenue increased by 50% YoY, reaching EGP 3.1bn, while both fixed and mobile data revenues continued to increase at a rate of 18% YoY, landing at EGP 15.9bn. On the customer front, Telecom Egypt achieved growth across all segments, with its fixed voice subscriber base reaching 12.4 million (+9% YoY), fixed data subscriber base reaching 9.3 million (+8% YoY), and mobile subscribers increasing by 6% YoY, reaching 12.5 million.

This growth led to an improved revenue mix, allowing it to achieve an EBITDA hike to EGP 17.6bn with a strong margin of 42%. Despite the 38% YoY increase in D&A costs, the operating profit reached EGP 10.6bn, up 23%. Net profit also grew by 48% YoY, reaching EGP 9.1bn due to positive operational results and higher investment income, despite a 3.7x higher interest expense.

They invested a total of EGP 11.7bn in in-service CapEX, implying in-service CapEX/sales of 28%, while cash CapEX (including license) reached EGP 18.4bn, implying cash CapEX/sales of 44%. Excluding the license installments, cash CapEX/sales would reach 37%. Even though gross debt increased due to foreign currency exposure revaluation, net debt/EBITDA remained flat at 1.5x, compared to FY 2022's 1.4x.

Finally, telecom Egypt generated a net operating cash flow of EGP 11.4bn, although FCFF amounted to a negative EGP 2.3bn, mainly due to vendor payments to secure CapEX and hedge against expected FX fluctuations.

Mohamed Nasr, managing director and chief executive officer, commented: “I’m pleased with our 9M 2023 financial results, as we head towards year-end on a strong note. Total revenue amounted to EGP 42.0bn, culminating from good broad-based growth across all business units and reflecting the value of our consistency in enhancing our services. Retail came through at the top again with EGP 23.2bn in revenue, up 16% YoY, driven by meaningful growth in fixed & mobile data services. Our wholesale also gained traction with EGP 18.8bn in revenue, up a strong 52% YoY. Across the board, we once again recorded an increase in customer numbers. EBITDA margin came in at 41.9%. and operating profit grew by 23% YoY.

“Our margins remained resilient against the inflationary pressures witnessed across the various cost elements in 9M 2023 (particularly the higher interest expense and currency devaluation), thanks to organic operational performance and continued savings from the national roaming agreement. Management continued to strategically procure and settle its CapEX requirements upfront; as such, FCFF was strained, amounting to a negative EGP 2.3bn, mainly due to the increase in vendor payments as a means of hedging against expected FX fluctuations in 2024 and other unforeseeable risks given the current volatile situation in the region.

“We continue to innovate and deliver, keeping in mind the rapidly changing needs of our partners and end users. A case in point is the recently launched WeConnect cross-connection ecosystem, which reflects our dedication to focus on our partners’ connectivity needs by designing solutions and further developing our well-established infrastructure to create sustainable financial returns and increase our shareholder value.

“Looking ahead to 2024, our strategy will be to focus on the pathways that will deliver significant and sustainable profitability. We will pursue and prioritize different growth options and opportunities to monetize our assets, especially U.S. dollar-generated assets, to bring more agility to the investment outlays for our core business, and to manage our operating costs. We will continue to deploy and develop innovative technologies to enhance the business and improve the end-user experience while enhancing our pricing and marketing strategies. I remain confident in our long-term trajectory, as we already have the right formula in place for continued success and long-term growth.”

Pin It