Ooredoo Group nine month revenue rises 2% to QR17.2bn

Doha, Qatar: Ooredoo Q.P.S.C. (“Ooredoo”) yesterday announced its financial results for the nine-month period ended September 30, 2023. Revenue for the first nine months of 2023 grew by 2% to QR17.2bn compared to QR16.9bn in the same period of the previous year.

The net profit increased 28% to QR2.7bn, compared to QR2.1bn in the first nine months of 2022.

Similarly, normalised net profit which takes into account various adjustments such as foreign exchange impact, impairment, and three one-off items (QR446m gain from the NMTC legal case, Meeza IPO gain of QR139m and QR56m gains from Indonesian tower sales), grew by 19% YoY to reach QR2.5bn, compared to QR2.1bn in 2022. These strong growth figures demonstrate the Group’s continued focus on profitability and the effective management of its operations.

Solid growth in Iraq, Algeria, Kuwait and Maldives were partially offset by a decline in revenue in Qatar, Oman and Tunisia as well as foreign exchange depreciation in Myanmar and Palestine.

Post quarter end, there has been severe damage to the infrastructure in Gaza, negatively impacting the Palestine operation. Palestine contributes approximately 2% to Group Revenue and on a consolidated basis, the impact is not material.

Group CAPEX spend came in at QR1.6bn in the first nine months of 2023, representing a 2% increase compared to the same period last year. The Group made strategic investments in Oman, Iraq, Tunisia and Maldives to drive growth in these markets. The CAPEX spend is expected to increase in the last quarter of the year in line with the historic quarterly trend.

Normalized Free Cash Flow increased by 8%YoY to QR5.7bn, driven by higher EBITDA. All operations contributed to the Free Cash Flow generated during the nine-month period, highlighting the strong financial performance and cash generation capabilities.

Ooredoo Group retained its robust investment grade rating in the first 9 months of 2023.Leverage a Net Debt/EBITDA ratio of 0.9x, remains well below the board’s guidance range of 1.5x to 2.5x. Furthermore, the Group’s financial position remains secure from interest rate risks as approximately 97% of the debt is structured on a fixed rate basis. Liquidity remains strong, with QR9.9bn in cash reserves and QR4.9bn available in undrawn facilities.

The Group’s consolidated customer base reached 56.7m, a 2 percent growth compared to 55.5m in the same period last year. This performance was driven by solid growth across most of the operations. Including IOH, the customer base grew 1% to 156.1 million.

Ooredoo Group continues to make consistent advancements toward its 2023 objectives. We anticipate the Revenue target to maintain stability, with the EBITDA margin expected to be within the low 40 percent range. Furthermore, our projected CAPEX for the entire year remains approximately at QR3bn.

Commenting on the results, Sheikh Faisal bin Thani Al Thani, Chairman of Ooredoo, said: “In the first nine months of 2023, the Ooredoo Group has demonstrated its steadfast dedication to providing connectivity, delivering exceptional customer experiences, and maximising value for our stakeholders.

During this period, we achieved remarkable financial results, with revenues totaling QR17.2bn and a significant increase in normalized net profit, reaching QR2.5bn.

Our digital transformation is contributing to our success and making us more resilient while allowing us to seize market opportunities and position ourselves for future expansion. Our adaptability in navigating a dynamic, ever-changing market landscape ensures our ongoing success and attractive returns.

Looking ahead, we are dedicated to continuing our exploration of strategic paths that unlock capital and enhance value for our stakeholders, further cementing our status as an industry leader.”

Also commenting on the results, Aziz Aluthman Fakhroo, Managing Director and CEO of Ooredoo Group said: “Ooredoo Group sustained its positive trajectory through Q3 2023, showcasing robust operational and financial results for the first nine months of 2023.

Revenue grew by 2 percent to QR17.2bn. The Group delivered positive operating leverage with EBITDA up by 4 percent to QR7.4bn with a corresponding improvement in the EBITDA margin of 1pp to 43 percent, supported by disciplined cost control across our operations.

The growth in the quarter was supported by solid contributions from Iraq, Kuwait, Algeria, and Maldives.

The Group recorded double-digit growth in normalised net profit of 19 percent to QR2.5bn.

The success of these results is owed to the dedication of our employees. Their steadfast commitment has played a pivotal role in our achievements.

As we look ahead, our goal is to uphold operational efficiency while pursing our strategic objectives, keeping us on course to meet our FY 2023 guidance targets. We keep strengthening our position as a leading telecommunications company striving to deliver competitive services to our customers and exceptional value to our stakeholders.”

Ooredoo remains committed to its strategy based on five fundamental pillars: delivering exceptional customer experience, empowering our people, and nurturing talent, driving innovation as a smart telco, continuously evolving and fortifying our core operations, and maintaining a value-focused portfolio.

We announced an update on the progress made under our value-focused portfolio pillar of our strategy on 24 July 2023 where we detailed that Ooredoo, Zain and TASC Towers Holding entered exclusive negotiations to create an independent tower company comprising of up to 30,000 towers.

The negotiations are ongoing in this complex transaction, we are aiming to sign before the end of the year.

We continue to move ahead on all these strategic programs, diligently working to create sustainable value for our customers, stakeholders, and the communities we serve.

On 6 December 2023, Ooredoo Group will hold a Capital Markets Day, where we will provide an update on how we are progressing against our strategic
pillars.

In the first nine months of 2023, EBITDA increased 4 percent to QR7.4bn, with EBITDA margin expanding by 1pp, benefiting from strong topline growth and disciplined cost control measures.

Solid EBITDA improvement in Iraq, Algeria and Kuwait were offset by a lower EBITDA in Qatar, Oman, and Tunisia.

In case of Ooredoo Qatar total revenue for the period was 4 percent lower YoY to QR5,500m. The drop was mainly attributed to the decision to scale down on low margin wholesale business and the carve-out of Ooredoo Financial Services.

Normalising for these one-off impacts, revenue remained flat despite the slowdown in economic activity and increased competitive intensity within the mobile segment. Fixed revenues showed an increase of 2 percent, driven by successful B2B customer deals and win-backs.