REG - Hellenic Telecomms - Q4/2024 Financial Results
26/02/2025 08:45
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RNS Number : 5300Y Hellenic Telecomms Organization S A 26 February 2025
OTE GROUP REPORTS 2024 FOURTH QUARTER AND FULL-YEAR RESULTS
Highlights
· Adj. EBITDA (AL) growth accelerates in Greece; up 1.8% in Q4
o Top line impacted by base effect and slowdown of low margin revenues,
resulting in higher EBITDA margin - Solid operational KPIs
o Robust TV revenues, rising 11%; Mobile service revenues continue upward
trend, up 1.4%
o Strong growth in FTTH customers, reaching nearly 400k; record quarterly
additions of 39k
o FTTH homes passed at 1.7mn, utilization exceeding 26%
· Total shareholders' payout at €451mn; 98% payout, unadjusted for
asset disposals
o Proposed Dividend at €0.7216 per share at €298mn
o €153mn share buyback program
o To be adjusted upon asset disposals (TKRM)
OTE GROUP (€ mn) Q4'24 Q4'23 y-o-y 12M'24 12M'23 y-o-y
Revenues 905.3 930.2 -2.7% 3,590.8 3,468.9 +3.5%
Adjusted EBITDA (AL) 344.5 341.1 +1.0% 1,347.3 1,342.5 +0.4%
margin % 38.1% 36.7% +1.4pp 37.5% 38.7% -1.2pp
EBIT 115.3 178.5 -35.4% 668.4 715.7 -6.6%
Profit to owners of the parent 64.5 134.5 -52.0% 478.8 531.7 -9.9%
Adj. Profit to owners of the parent 155.6 140.8 +10.5% 600.8 562.7 +6.8%
EPS (€) 0.1583 0.3223 -50.9% 1.1630 1.2556 -7.4%
Capex 166.7 191.5 -13.0% 599.7 621.4 -3.5%
Free Cash Flow (AL) 100.7 104.1 -3.3% 444.2 501.2 -11.4%
Adjusted Free Cash Flow (AL) 141.6 116.1 +22.0% 522.5 543.5 -3.9%
Cash and cash equivalents 467.0 463.9 +0.7% 467.0 463.9 +0.7%
Net Debt 643.4 634.8 +1.4% 643.4 634.8 +1.4%
Note: The purpose and calculations of all 'Adjusted' data are detailed in the
Alternative Performance Measures Section (#APM)
Message from the Chairman & CEO, Kostas Nebis:
"In 2024, we delivered on our targets, demonstrating a solid operational and
financial performance in Greece. We achieved a 4.5% revenue growth and a 1.6%
increase in adjusted EBITDA (AL), mainly driven by strong contributions from
mobile, pay-TV and ICT. OTE continued to solidify its market leadership in
best-in-class networks. In fixed, FTTH footprint was further expanded to 1.7
million households and businesses, as we continue our aggressive rollout,
offering our customers the leading connectivity experience. In mobile, we
maintained our competitive edge with 99% coverage of our 5G network,
positioning us as one of only three mobile networks globally certified as
"Best in Test" for the 10(th) consecutive year. These achievements underscore
our commitment to delivering superior network performance and customer
experience.
"As we progress into 2025, I am confident that we will continue to build on
our achievements, aiming for accelerated growth in the upcoming years. We have
shaped a new vision for OTE, with the aim of becoming one of Europe's leading
digital telecommunications operators and positioning Greece at the forefront
of digitalization in Europe. We have established ambitious targets that will
guide our path and enable us to create more value for our shareholders."
OUTLOOK
In 2025, OTE will pursue its investment strategy and remain focused on
investing in best-in class networks and strengthening its leadership in
Greece's network infrastructure. The Company plans to pass approximately 2.1
million homes and businesses with FTTH by the end of 2025 while also expanding
its 5G Stand-Alone (SA) coverage. In addition, OTE will remain committed to
delivering superior customer experience, investing in digital services and
customer touchpoints while at the same time it will further transform its
operations.
Given the current market dynamics, OTE expects to continue growing in 2025: In
Broadband, it will leverage initiatives such as the Gigabit
Voucher and Smart Readiness Coupon to further promote FTTH service uptake.
The recent launch of FWA solution should further support Broadband trends. In
TV, the sports content-sharing agreement with NOVA is accelerating Pay-TV
adoption in Greece, while the recent antipiracy legislation should further
support growth. OTE is expanding its customer base while also enhancing its
ARPU. In Mobile, high prepaid customer base and more-for-more strategy
provides further growth opportunities. Positive momentum in postpaid base is
expected to continue in 2025 while recent initiatives announced in the prepaid
segment are expected to support mobile growth. In ICT, where OTE serves as one
of the major Systems Integrators for businesses and the public sector in
Greece and the EU, it should continue benefiting from the ongoing deployment
of the EU Recovery and Resilience Fund. In Wholesale, OTE anticipates
continuing facing headwinds, while the volume discount agreement in the FTTH
wholesale market should facilitate the transition towards fiber optic services
and enhance investment monetization.
2025 Guidance:
· Free Cash Flow (FCF): OTE Group anticipates generating approximately
€460mn Free Cash Flow (FCF) in 2025, incorporating estimated cash flow
requirements in TELEKOM ROMANIA MOBILE (TKRM) for the full year, in case of no
disposal.
· Capital Expenditure (CAPEX): The Group projects CAPEX
of €610mn-€620mn in 2025, focusing on the expansion of its Fiber to the
Home (FTTH) infrastructure.
· Adj. EBITDA (AL): OTE expects EBITDA growth in Greece to reach almost
2%, fueled by solid performance across key services, including mobile,
broadband, and TV alongside effective cost management in several areas.
2025 SHAREHOLDER REMUNERATION
OTE intends to distribute approximately 98% of its expected 2025 Free Cash
Flow of approximately €460mn. Total shareholder remuneration is targeted at
approximately €451mn, corresponding to a proposed €298mn cash dividend and
approximately €153mn in share buyback. In case TKRM disposal concludes
successfully within 2025 and depending on the outcome, the proposed amount for
shareholder remuneration will be adjusted accordingly to reflect the real
impact on OTE Group Free Cash Flow. The proposed dividend per share stands at
€0.7216 per share. The dividend will be paid out to shareholders following
approval of the Annual General Meeting of Shareholders. It is noted that own
shares owned by the Company at the ex-dividend date are not entitled to
dividend. Therefore, the dividend corresponding to such own shares, will
increase the dividend payable to the other shareholders according to the law.
OTE GROUP HIGHLIGHTS
ΟΤΕ Group Revenues in Q4'24 were down 2.7% to €905.3mn, primarily due to
a substantial decline in low-margin international wholesale revenues in Greece
and continued pressure on Romanian operations. Revenues from Greek operations
were down 1.4%, as growth momentum in Mobile, TV, and ICT services was offset
by a seasonal drop in international wholesale. In Romania, revenues declined
by 17.4% in a highly competitive market, partly reflecting the impact of
mobile termination rate (MTR) cuts and ICT related revenues in the comparable
quarter of 2023.
Total Group Operating Expenses, excluding depreciation, amortization,
impairment and charges related to voluntary leave schemes and restructuring
costs, amounted to €547.1mn in Q4'24, down 4.3%. The decrease was primarily
driven by lower direct costs associated with reduced revenues, as well as cost
containment measures in certain areas, including personnel costs.
Group Adjusted EBITDA (AL) stood at €344.5mn up 1.0%, driven by 1.8% growth acceleration in Greek operations. The Group's EBITDA (AL) margin increased to 38.1% in the quarter, compared to 36.7% in the same period last year.
Operating profit before financial and investing activities (EBIT) stood at
€115.3mn down 35.4% compared to €178.5mn a year ago, mainly driven by
42.7% increase in depreciation due to the impairment loss of €89.8mn
recognized in Q4'24, as a result of the impairment test performed for TELEKOM
ROMANIA MOBILE.
Group Capex in Q4'24 amounted to €166.7mn, down 13.0% from Q4'23, primarily
due to lower spending on TV sports content, compared to the same period last
year, following the UEFA broadcasting auction. Capex in Greece and Romania
stood at €158.4mn and €8.3mn, respectively.
Adjusted Free Cash Flow (AL) reached €141.6mn, up 22.0% from Q4'23 driven by
lower capex payments during the quarter and higher profitability. Reported
Free Cash Flow (AL) stood at €100.7mn, mainly reflecting the €33.5mn
additional tax charges imposed to Telekom Romania Mobile (TKRM) for the
2017-2021 tax audit.
The Group's Net Debt stood at €643.4mn as of December 31, 2024, and the
ratio of net debt to 12-month Adjusted EBITDA (AL) stood at 0.5x. The Group
does not face any bond maturity until September 2026 (€500mn 0.875% Notes).
Revenues (€mn) Q4'24 Q4'23 y-o-y 12M'24 12M'23 y-o-y
Greece 843.1 854.8 -1.4% 3,334.0 3,189.4 +4.5%
Romania mobile 64.0 77.5 -17.4% 263.3 286.9 -8.2%
Eliminations (1.8) (2.1) -14.3% (6.5) (7.4) -12.2%
OTE GROUP 905.3 930.2 -2.7% 3,590.8 3,468.9 +3.5%
Adjusted EBITDA (AL) (€mn) Q4'24 Q4'23 y-o-y 12M'24 12M'23 y-o-y
Greece 343.1 337.0 +1.8% 1,346.2 1,325.5 +1.6%
margin (%) 40.7% 39.4% +1.3pp 40.4% 41.6% -1.2pp
Romania mobile 1.4 4.1 -65.9% 1.1 17.0 -93.5%
margin (%) 2.2% 5.3% -3.1pp 0.4% 5.9% -5.5pp
OTE GROUP 344.5 341.1 +1.0% 1,347.3 1,342.5 +0.4%
margin (%) 38.1% 36.7% +1.4pp 37.5% 38.7% -1.2pp
SUSTAINABILITY
In 2024, OTE Group maintained its positive sustainability performance, as
reflected in the first consolidated Sustainability Statement for OTE Group
(https://www.cosmote.gr/static/otegroup/en/page/oikonomikes_katastaseis_omilou_ote_kai_ae)
. Key achievements include:
· 8% reduction in emissions across the entire value chain, compared to
the previous year
· 100% of electricity consumption was covered by renewable energy
sources
· 88% of waste generated was recycled
· 100% of ICT waste sustainably managed
GREECE HIGHLIGHTS
Fixed Segment Operational Data Q4'24 Q4'23 y-o-y Net Adds
Fixed line subscribers 2,580,799 2,616,711 -1.4% (35,912) (5,852)
Broadband subscribers 2,352,149 2,355,545 -0.1% (3,396) 2,566
...out of which: Total Fiber (FTTx) 1,612,394 1,544,981 +4.4% 67,413 20,216
394,499 250,557 +57.4% 143,942 39,445
...out of which: FTTH
TV subscribers 725,594 677,035 +7.2% 48,559 15,405
Note: All operational KPI's for 2024 and 2023 period have been reclassified.
Fixed, Broadband and TV operational data include only RGU.
FTTH: In 2024, OTE solidified its position as the leader in the Greek market
for Fiber-To-The-Home (FTTH) infrastructure. As of December 2024, OTE's FTTH
network had reached 1.7 million homes and businesses, accounting for a
substantial share of the total installed FTTH lines in Greece. The company
plans to extend coverage to 2.1 million homes by the end of 2025 and
approximately 3 million by 2027.
OTE continues to achieve strong growth in its FTTH subscriber base, delivering
another record quarter with 39k customer additions. The total number of its
FTTH subscribers reached 394k, representing 16.8% of its total broadband
connections. While this represents an increase of 6 percentage points compared
to the previous year, there remains significant potential for future growth.
Among its customers with access to FTTH infrastructure, the respective
penetration has already exceeded 40%, underscoring the sustained demand for
high-quality connectivity services.
As of December 2024, utilization rate of OTE's FTTH infrastructure reached
26.2%, reflecting a significant increase from 19.5% the previous year. Out of
394k total OTE FTTH customers, 85% utilize OTE's FTTH network infrastructure.
Additionally, 41% of competitors FTTH subscribers rely on OTE's
infrastructure, up from 36% a year earlier, reflecting higher wholesale
volumes from competition, driven by the FTTH wholesale agreement between the
key players in the market.
Gigabit Voucher: The Gigabit Voucher that was launched by the Greek government
in late 2024, is expected to further enhance the adoption
of FTTH connections. The program offers a connectivity voucher of up
to €200 for speeds of at least 250 Mbps over a 24-month period. It will
be rolled out in four phases, in conjunction with the "Smart
Readiness" in-building connection subsidy. These subsidies schemes will
support higher penetration levels and increasing utilization rate of OTE's
infrastructure. As FTTH take-up results in higher customer satisfaction, lower
churn, and reduced operating costs, expansion of the FTTH subscriber base
represents a critical step in laying the foundation for long-term growth.
Fixed Broadband - FWA: In the fixed broadband market, the company has
encountered certain challenges, particularly in underserved areas where fiber
optic infrastructure is not yet available. To effectively respond, OTE
launched FWA services, in the beginning of 2025, through 5G+ network slicing,
a cutting-edge solution leveraging its 5G WiFi technology.
TV: OTE's TV segment reached 726k subscribers at the end of December, a
year-on-year increase of 7.2%. OTE recorded positive additions of 15k TV
subscribers, benefiting from the sports content-sharing agreement with NOVA.
The agreement has significantly enhanced the Pay-TV content offering for Greek
consumers, while it serves as an effective policy to add value for subscribers
and combat persisting piracy. As already evident in the quarter, the agreement
is expected to further drive growth of the overall Greek Pay-TV market, while
the recent approval of the antipiracy legislation should further support this
direction.
Mobile Segment Operational Data Q4'24 Q4'23 y-o-y Net Adds
Mobile Subscribers 7,142,553 7,118,679 +0.3% 23,874 (42,154)
2,856,891 2,682,371 +6.5% 174,520 33,581
Postpaid
4,285,662 4,436,308 -3.4% (150,646) (75,735)
Prepaid
Note: All operational KPI's for 2024 and 2023 period have been reclassified.
In the Mobile segment reclassification mainly refers to a certain shift
between Postpaid and Prepaid segment.
OTE achieved further progress in its postpaid segment, leveraging its strong
leadership in mobile network quality and its competitive advantage in customer
service excellence. Postpaid additions remained strong in the quarter, at 34k,
increasing the base to 2.9mn, a 6.5% increase compared to the previous year.
Customer additions and ongoing upgrades from prepaid to postpaid plans were
once again evident in the quarter. Prepaid customers now represent 60% of the
total mobile base, down from 62% a year earlier, signaling further potential
for upgrades.
Consistent with its strategy, the company continues to invest in expanding its
mobile network. Population coverage of OTE's 5G network reached 99% in 2024,
while the company was the first in Greece that upgraded its 5(th) generation
mobile network to 5G+ network (5G Stand-Alone) covering approximately 60% of
the population. 5G+ technology will further enhance customer experience
providing even higher download and upload speeds, ultra-low latency, improved
indoor coverage and even greater reliability of communications, moving even
closer to realization of a "Gigabit Society".
Ongoing investments in mobile network infrastructure are constantly
recognized. OTE's network is one of only three mobile networks worldwide with
the "Best in Test" certification by "umlaut" for the 10(th) consecutive year
while it was awarded as "the Fastest Mobile Network in Greece" at the
Speedtest Awards(TM) by Ookla(®) for the 8(th) consecutive year. Recognition
of OTE's network quality, supported by ongoing investment, drives positive
customer preferences and revenue growth.
Financial Data (€mn) Q4'24 Q4'23 y-o-y 12M'24 12M'23 y-o-y
Revenues 843.1 854.8 -1.4% 3,334.0 3,189.4 4.5%
Retail Fixed Services 226.8 230.1 -1.4% 911.0 915.1 -0.4%
...Including Data Com. 251.4 253.8 -0.9% 1,005.4 1,007.4 -0.2%
Mobile Service Revenues 252.4 249.0 +1.4% 1,037.3 1,009.0 +2.8%
Wholesale Services 134.9 156.7 -13.9% 583.1 572.5 +1.9%
Other Revenues 229.0 219.0 +4.6% 802.6 692.8 +15.8%
…οut of which System Solutions 88.0 87.0 +1.1% 313.9 235.1 +33.5%
Adjusted EBITDA (AL) 343.1 337.0 +1.8% 1,346.2 1,325.5 +1.6%
margin (%) 40.7% 39.4% +1.3pp 40.4% 41.6% -1.2pp
· Total revenues from Greek operations were down 1.4% to €843.1mn in
Q4'24, as lower international wholesale revenue more than offset the positive
momentum in mobile, TV and ICT.
· Retail fixed service revenues decreased by 1.4% in the quarter. The
base effect due to the anniversary of the elimination of the "e-bill" discount
late in 2023, coupled with challenging trends in legacy services, led to the
downward trend in fixed service revenues. Ongoing strong momentum in TV along
with the Gigabit voucher for FTTH and the FWA service recently launched is
expected to support fixed retail revenues in the coming period.
· Mobile service revenues maintained positive momentum in Q4'24,
increasing by 1.4%. The slowdown in growth trends is attributed to the
comparative effects of certain initiatives mainly in prepaid introduced in Q4
of 2023 along with the "e-bill" discount elimination. Ongoing expansion in
mobile segment primarily reflects customer transitions from prepaid to
postpaid plans along with the uptake of higher-value services. The substantial
base of prepaid customers, coupled with the upside potential in data
consumption, provide further growth opportunities. In addition, the Company
has recently announced certain initiatives in the prepaid segment that should
further support mobile growth in the coming period. For the full year 2024,
visitor revenues reached €54mn, up 3.5% compared to the previous year.
· Wholesale revenues were down 13.9% in the quarter, due to lower
revenues from low-margin international transit traffic as well as the
anticipated drop in the domestic wholesale stream, mainly reflecting the
infrastructure built by other operators. The wholesale agreement with key
market players should allow OTE to partially mitigate the downside from this
revenue stream over time.
· Other revenues were up 4.6% in the quarter, driven by a 7.4% increase
in handset revenues and ongoing positive momentum in ICT. Specifically,
revenues from systems solutions increased by 1.1% during the quarter despite
facing an unfavorable high comparison base, as major projects in Q3'23 were
postponed to the fourth quarter, due to last year's Greek elections. ΟΤΕ
acts as a major Systems Integrator for businesses and the public sector,
supporting digitalization with the provision of state-of-the-art technology
infrastructure, as well as innovative and customized IT and cloud solutions.
Recent agreements include the framework contract with NATO Communications and
Information Agency (NCIA) for the development of modern technology
infrastructure and the provision of consulting services. OTE has also been
awarded several contracts in the private sector, including the provision of
managed network services, ERP systems, fiber optic infrastructure, etc.
· Adjusted EBITDA (AL) in Greece increased by 1.8% to €343.1mn, an
acceleration compared to the trends evidenced in prior quarters, while the
margin stood at 40.7%. Ongoing growth in mobile combined with lower costs,
-particularly in personnel and maintenance during the quarter-more than offset
pressure in some revenue lines and higher energy costs of approximately €7mn
in the quarter.
ROMANIA HIGHLIGHTS
Mobile Segment Operational Data Q4'24 Q4'23 y-o-y Net Adds
Mobile Subscribers 3,516,885 3,798,434 -7.4% (281,549) (30,236)
1,968,605 1,915,939 +2.7% 52,666 8,678
Postpaid
1,548,280 1,882,495 -17.8% (334,215) (38,914)
Prepaid
Financial Data (€mn) Q4'24 Q4'23 y-o-y 12M'24 12M'23 y-o-y
Revenues 64.0 77.5 -17.4% 263.3 286.9 -8.2%
Mobile Service Revenues 37.3 43.3 -13.9% 154.7 185.0 -16.4%
Other Revenues 26.7 34.2 -21.9% 108.6 101.9 +6.6%
Adjusted EBITDA (AL) 1.4 4.1 -65.9% 1.1 17.0 -93.5%
margin (%) 2.2% 5.3% -3.1pp 0.4% 5.9% -5.5pp
Total revenues from Telekom Romania Mobile (TKRM) amounted to €64.0mn in the
quarter, down 17.4% year on year. Revenues were impacted by continuing
challenging market dynamics, while overall operations in Romania continue to
suffer from the impact of mobile termination rate (MTR) cuts. A 50% MTR cut
has been implemented as of the beginning of 2024. In addition, the comparable
quarter of 2023 includes €5mn revenues from ICT services. Excluding the
impact of MTR and ICT, total revenues would be down by approximately €6m or
9.5%.
Ongoing positive customer additions on the postpaid segment continues, as the
postpaid base achieved a 2.7% year-on-year increase to a total of 1.97mn
subscribers. Net additions in the quarter stood at 9k.
In October 2024, the Romanian Tax Authority imposed additional tax charges of
€33.5mn on Telekom Romania Mobile in the context of a tax audit for fiscal
years 2017 to 2021. This amount does not impact Adjusted figures (see
Alternative Performance Measures).
Adjusted EBITDA (AL) from Romanian operations stood at €1.4mn, mainly
reflecting the ongoing topline pressure along with the effect from the new tax
on revenue introduced in 2024.
SIGNIFICANT EVENTS OF THE QUARTER
Share Buyback Program
During the period from February 26, 2024, to January 10, 2025, when the
purchases under 2024 SBB program were completed, the Company acquired
10,556,684 own shares, at an average price of €14.48 per share. Out of these
shares, 3,381,933 own shares acquired during the period from February 26,
2024, to May 31, 2024, were cancelled and delisted on July 24, 2024, along
with 1,926,507 own shares acquired in the previous Share Buyback Program. As
of February 25, 2025, the company holds 7,174,751 own shares acquired from
June 1, 2024, to January 10, 2025, with the aim to be cancelled in the Annual
General Meeting of Shareholders. The 2025 Share Buyback programme is expected
to commence in the coming days.
Repayment of Notes
On October 24, 2024, the €40.0mn fixed-rate Notes under the Global
Medium-Term Note Program of OTE PLC, fully subscribed by Deutsche Telekom AG,
were fully repaid at maturity.
Potential Telekom Romania Mobile disposal
On October 31, 2024, OTE announced that it, has entered into negotiations for
the sale of Telekom Romania Mobile ("TKRM") with Digi Romania S.A and Vodafone
Romania S.A. The parties have signed a Memorandum of Understanding (MoU) and
have filed the proposed transaction for approval with the Romanian competent
authorities (RCC, FDI, ANCOM). The MoU provides that certain assets of TKRM
would be acquired by Digi, while the remaining assets and the Company would be
acquired by Vodafone Romania. Completion of the transaction is subject to the
signing of a Share Purchase Agreement and transaction documentation, as well
as obtaining regulatory approvals.
Mobile Passive Infrastructure Spin-off
On November 13, 2024, the Board of Directors of OTE approved the initiation of
the spin-off procedure of the "Mobile Passive Infrastructure Sector" and the
establishment of a new company for this purpose. The spin-off will take place
in accordance with the provisions of laws 4601/2019, 4548/2018, 4172/2013 and
4438/2016. The 30(th) of November was designated as the Transformation Balance
Sheet date for the spin-off. The above decision aims to optimize the corporate
structure, operational efficiency and value creation in OTE Group. The
completion of the spin-off is subject to the required approvals by the Board
of Directors, the General Assembly of the Company's Shareholders and the
competent authorities.
About OTE
OTE Group is the largest telecommunications provider in the Greek market and
offers mobile telecommunications services in Romania. OTE is among the largest
listed companies, with respect to market capitalization, in the Athens Stock
Exchange.
OTE Group offers the full range of telecommunications services: from
fixed-line and mobile telephony, broadband services, to pay television and ICT
solutions. In addition to its core activities, the Group is also involved in
electronic payments, delivery services, real estate, insurance distribution
and professional training.
Additional Information is also available on: https://www.cosmote.gr
(https://www.cosmote.gr)
Conference Call Details
Wednesday, February 26, 2025
13:00pm (EET), 11:00am (GMT), 12:00pm (CET), 06:00am (EST)
Dial-in
Details
Greece +30 210 9460 800
Germany +49 (0) 69 2222 4493
UK & International +44 (0) 203 059 5872
USA +1 516 447 5632
We recommend that you call any of the above numbers 5 to 10 minutes before the
conference call is scheduled to start.
Live Webcast Details
The conference call will be webcast and you may join by linking at:
https://87399.themediaframe.eu/links/otegroup250226.html
(https://87399.themediaframe.eu/links/otegroup250226.html)
If you experience difficulty, please call + 30 210 9460803.
Investor Relations Contacts:
Evrikos Sarsentis - Head of Mergers, Acquisitions and Investor Relations
Tel: +30 210 611 1574, Email: esarsentis@ote.gr (mailto:esarsentis@ote.gr)
Sofia Ziavra - Deputy Director, Investor Relations
Tel: + 30 210 617 7628, Email: sziavra@ote.gr
Elena Boua - Manager Shareholder Services, Investor Relations
Tel: + 30 210 611 7364, Email: eboua@ote.gr (mailto:eboua@ote.gr)
Forward-looking Disclaimer
Certain statements in this document constitute forward-looking statements.
Such forward looking statements are subject to risks and uncertainties that
may cause actual results to differ materially. These risks and uncertainties
include, among other factors, changing economic, financial, business or other
market conditions. OTE will not update such statements on a regular basis. As
a result, you are cautioned not to place any reliance on such forward-looking
statements. Nothing in this document should be construed as a profit forecast
and no representation is made that any of these statements or forecasts will
come to pass. Persons receiving this announcement should not place undue
reliance on forward-looking statements and are advised to make their own
independent analysis and determination with respect to the forecast periods,
which reflect the Group's view only as of the date hereof.
Exhibits:
I. Alternative Performance Measures "APMs"
II. Consolidated Statement of Financial Position as of
December 31, 2024 and December 31, 2023
III. Consolidated Income Statement for the quarter and full year
ended December 31, 2024 and comparative 2023
IV. Consolidated Statement of Cash Flows for the quarter and full
year ended December 31, 2024 and comparative 2023
I. ALTERNATIVE PERFORMANCE MEASURES "APMS"
The Group uses certain Alternative Performance Measures ("APMs") in making
financial, operating and planning decisions as well as in evaluating and
reporting its performance. APMs provide additional insights and understanding
to the Group's underlying performance, financial condition and cash flow. APMs
and the respective adjusted measures are calculated by using the directly
reconcilable amounts from Financial Statements of the Group and the below
items as well, that due to their nature impacting comparability. As these
costs or payments are of significant size and of irregular timing, it is a
common industry practice to be excluded for the calculation of the APMs and
the adjusted figures in order to facilitate comparability with industry peers
and facilitate the user to obtain a better understanding of the Group's
performance achieved from ongoing activity. The APMs should be read in
conjunction with and do not replace by any means the directly reconcilable
IFRS line items.
1. Costs or payments related to Voluntary Leave Schemes: Costs or payments
related to Voluntary Leave Schemes comprise the exit incentives provided to
employees and the contributions to the social security fund to exit/retire
employees before conventional retirement age. These costs are included within
the income statement as well as within the cash flow statement lines "costs
related to voluntary leave schemes" and "payment for voluntary leave schemes",
respectively.
2. Costs or payments related to other restructuring plans: Other
restructuring costs comprise non-ongoing activity related costs arising from
significant changes in the way the Group conducts business. These costs are
mainly related to the Group's portfolio management restructuring.
3. Costs or payments related to Romania tax audit for fiscal years
2017-2021: Costs or payments related to Romania tax audit comprise the
additional tax charges related to alleged VAT and Corporate Income Tax
miscalculations, imposed by the Romanian Tax Authority (ANAF) after the tax
audit for fiscal years 2017-2021.
4. Spectrum acquisition payments: Spectrum payments comprise the amounts
paid to acquire rights (licenses) through auctions run by the National
Regulator to transmit signals over specific bands of the electromagnetic
spectrum.
Definitions and Reconciliations of Alternative Performance Measures ("APMs")
Net Debt
Net Debt is used to evaluate the Group's capital structure and leverage. Net
Debt is defined as long-term borrowings plus short-term portion of long-term
borrowings plus short-term borrowings plus other financial liabilities less
cash and cash equivalents. Following the adoption of IFRS 16 financial
liabilities related to leases are included in the calculation of net debt.
OTE Group (€ mn) 31/12/2024 31/12/2023
Long-term borrowings 848.5 847.7
Short-term portion of long-term borrowings - -
Short-term borrowings - -
Lease liabilities (long-term portion) 189.4 184.9
Lease liabilities (short-term portion) 63.4 60.8
Financial liabilities related to digital wallets 9.1 5.3
Cash and cash equivalents (467.0) (463.9)
Net Debt 643.4 634.8
EBIT
Earnings Before Interest and Taxes (EBIT) is derived directly from the
Financial Statements of the Group, line "Operating profit before financial and
investing activities" of the Income Statement. EBIT provides useful
information to analyze the Group's operating performance.
EBITDA - Adjusted EBITDA - Adjusted EBITDA After Lease (AL)
· EBITDA is derived directly from the Financial Statements of the
Group, line "Operating profit before financial and investing activities,
depreciation, amortization and impairment" of the Income Statement. EBITDA is
defined as total revenues plus other operating income less total operating
expenses before depreciation, amortization and impairment. EBITDA provides
useful information to analyze the Group's operating performance.
· Adjusted EBITDA is calculated by excluding the impact of costs
related to voluntary leave schemes, other restructuring costs and costs
related to Romania 2017-2021 tax audit.
· Adjusted EBITDA After Lease (AL): Following the adoption of IFRS 16
related to leases, it is a common industry practice to use the EBITDA After
Lease (AL) or Adjusted EBITDA After Lease (AL) in order to facilitate
comparability with industry peers and historical comparison as well. Adjusted
EBITDA (AL) is defined as Adjusted EBITDA deducting the amortization and
interest expense related to leases.
EBITDA, Adjusted EBITDA and Adjusted EBITDA (AL) margin (%) is defined as the
respective EBITDA divided by total revenues.
Q4'24 (€ mn) OTE Group Greece Romania
Q4'24 Q4'23 Q4'24 Q4'23 Q4'24 Q4'23
Revenues 905.3 930.2 843.1 854.8 64.0 77.5
Other Operating Income 7.1 1.1 6.8 1.6 0.6 (0.3)
Total Operating Expenses (before Depreciation, amortization and impairment) (549.9) (579.6) (495.3) (512.0) (56.7) (69.9)
EBITDA 362.5 351.7 354.6 344.4 7.9 7.3
Costs related to voluntary leave schemes 2.5 4.8 2.5 3.7 - 1.1
Costs related to Romania 2017-2021 tax audit - - - - - -
Other restructuring costs 0.3 3.1 0.3 3.1 - -
Adjusted EBITDA 365.3 359.6 357.4 351.2 7.9 8.4
Amortization of lessee use rights to leased assets (18.1) (15.9) (12.4) (12.4) (5.7) (3.5)
Interest expense on leases (2.7) (2.6) (1.9) (1.8) (0.8) (0.8)
Adjusted EBITDA (AL) 344.5 341.1 343.1 337.0 1.4 4.1
margin % 38.1% 36.7% 40.7% 39.4% 2.2% 5.3%
12M'24 (€ mn) OTE Group Greece Romania
12M'24 12M'23 12M'24 12M'23 12M'24 12M'23
Revenues 3,590.8 3,468.9 3,334.0 3,189.4 263.3 286.9
Other Operating Income 12.5 9.7 10.8 7.1 2.0 2.8
Total Operating Expenses (before Depreciation, amortization and impairment) (2,231.6) (2,096.4) (1,977.4) (1,851.0) (261.0) (253.0)
EBITDA 1,371.7 1,382.2 1,367.4 1,345.5 4.3 36.7
Costs related to voluntary leave schemes 33.8 35.3 33.6 33.8 0.2 1.5
Costs related to Romania 2017-2021 tax audit 19.7 - - - 19.7 -
Other restructuring costs 2.3 3.9 1.3 3.1 1.0 0.8
Adjusted EBITDA 1,427.5 1,421.4 1,402.3 1,382.4 25.2 39.0
Amortization of lessee use rights to leased assets (70.1) (69.7) (48.7) (49.9) (21.4) (19.8)
Interest expense on leases (10.1) (9.2) (7.4) (7.0) (2.7) (2.2)
Adjusted EBITDA (AL) 1,347.3 1,342.5 1,346.2 1,325.5 1.1 17.0
margin % 37.5% 38.7% 40.4% 41.6% 0.4% 5.9%
Capital expenditure (Capex) and Adjusted Capex
Capital expenditure is derived directly from the Financial Statements of the
Group, line "Purchase of property, plant and equipment and intangible assets"
of the Cash Flow Statement. The Group uses Capex to ensure that the cash
spending is in line with its overall strategy for the use of cash. Adjusted
Capex is defined as Capex excluding spectrum payments.
OTE Group (€ mn) Q4'24 Q4'23 12M'24 12M'23
Purchase of property plant and equipment and intangible assets - Capex (166.7) (191.5) (599.7) (621.4)
Spectrum Payments - - - -
Adjusted CAPEX (166.7) (191.5) (599.7) (621.4)
Free Cash Flow (FCF)- Free Cash Flow After Lease (AL) - Adjusted FCF After
Lease (AL)
· Free Cash Flow is defined as net cash flows from operating
activities, after payments for purchase of property, plant and equipment and
intangible assets (Capex) and adding the interest received. Free Cash Flow
After Lease (AL) is defined as Free Cash Flow after lease repayments.
· Adjusted FCF After Lease (AL) facilitates comparability of Cash Flow
generation with industry peers and discussions with the investment analyst
community and debt rating agencies. It is calculated by excluding from the
Free Cash Flow After Lease (AL) payments for voluntary leave schemes payment
for costs related to Romania 2017-2021 tax audit, payment for income tax due
to Romania 2017-2021 tax audit, and other restructuring costs as well as
spectrum payments.
FCF After Lease (AL) and Adjusted FCF After Lease (AL) are intended to measure
the cash generation from the Group's business activities while facilitate the
understanding the Group's cash generating performance as well as availability
for debt repayment, dividend distribution and own reserves.
OTE Group (€ mn) Q4'24 Q4'23 12M'24 12M'23
Net cash flows from operating activities 283.9 313.6 1,102.2 1,195.1
Purchase of property, plant, equipment and intangible assets (166.7) (191.5) (599.7) (621.4)
Interest received 3.5 3.2 13.3 10.4
Free Cash Flow 120.7 125.3 515.8 584.1
Lease repayments (20.0) (21.2) (71.6) (82.9)
Free Cash Flow After Lease (AL) 100.7 104.1 444.2 501.2
Payment for voluntary leave schemes 7.4 11.2 41.5 39.9
Payment for costs related to Romania 2017-2021 tax audit 19.7 - 19.7 -
Income tax payment related to Romania 2017-2021 tax audit 13.8 - 13.8 -
Payment for other restructuring costs - 0.8 3.3 2.4
Spectrum payments - - - -
Adjusted FCF After Lease (AL) 141.6 116.1 522.5 543.5
Adjusted Profit to owners of the parent
Adjusted Profit for the period attributable to owners of the parent is
intended to provide useful information to analyze the Group's net
profitability excluding the impact of significant non-recurring or irregularly
recorded items in order to facilitate comparability with previous ongoing
performance. For the respective period of 2024 and the comparable period of
2023, Profit to owners of the parent was impacted by costs related to
voluntary leave schemes, other restructuring costs, costs related to Romania
2017-2021 tax audit, loss from the sale of investment, reversal of provision
related to Assets sales, income tax effect due to Romania 2017-2021 tax audit
and net impact from impairments and write offs.
OTE Group (€ mn) Q4'24 Q4'23 12M'24 12M'23
Profit to owners of the Parent 64.5 134.5 478.8 531.7
Costs related to voluntary leave schemes 1.9 4.0 26.4 27.9
Other restructuring costs 0.2 2.4 2.0 3.2
Costs related to Romania 2017-2021 tax audit - - 19.7 -
Income tax effect due to Romania 2017-2021 tax audit - - 13.8 -
Loss from the sale of investment - - 1.9 -
Reversal of provision related to Assets Sales (0.8) (0.1) (31.6) (0.1)
Net impact from impairments and write offs 89.8 - 89.8 -
Adjusted Profit to owners of the parent 155.6 140.8 600.8 562.7
II. ΟΤΕ GROUP CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(€ mn) 31/12/2024 31/12/2023
ASSETS
Non - current assets
Property, plant and equipment 2,227.6 2,188.3
Right-of-use assets 262.4 258.4
Goodwill 376.6 376.6
Telecommunication licenses 227.8 264.0
Other intangible assets 279.6 263.1
Investments 0.1 0.1
Loans to pension funds 56.5 60.7
Deferred tax assets 189.3 185.0
Contract costs 25.3 28.7
Other non-current assets 77.4 77.3
Total non - current assets 3,722.6 3,702.2
Current assets
Inventories 51.1 58.9
Trade receivables 536.4 537.6
Other financial assets 6.3 5.6
Contract assets 76.5 63.9
Other current assets 134.6 103.7
Restricted cash 0.7 0.6
Cash and cash equivalents 467.0 463.9
Total current assets 1,272.6 1,234.2
TOTAL ASSETS 4,995.2 4,936.4
EQUITY AND LIABILITIES
Equity attributable to owners of the Parent
Share capital 1,167.9 1,182.9
Share premium 416.4 422.8
Treasury shares (104.2) (25.3)
Statutory reserve 440.7 440.7
Foreign exchange and other reserves (156.4) (148.2)
Retained earnings 200.5 70.4
Total equity attributable to owners of the Parent 1,964.9 1,943.3
Non-controlling interests - 0.5
Total equity 1,964.9 1,943.8
Non-current liabilities
Long-term borrowings 848.5 847.7
Provision for staff retirement indemnities 109.6 107.0
Provision for youth account 69.0 75.9
Contract liabilities 78.9 84.9
Lease liabilities 189.4 184.9
Deferred tax liabilities 0.6 0.4
Other non - current liabilities 86.9 43.0
Total non - current liabilities 1,382.9 1,343.8
Current liabilities
Trade accounts payable 866.4 866.4
Income tax payable 66.9 95.2
Contract liabilities 258.9 223.9
Lease liabilities 63.4 60.8
Dividends payable 2.4 2.5
Other current liabilities 389.4 400.0
Total current liabilities 1,647.4 1,648.8
TOTAL EQUITY AND LIABILITIES 4,995.2 4,936.4
III. OTE GROUP CONSOLIDATED INCOME STATEMENT
(€ mn) Q4'24 Q4'23 y-o-y 12M'24 12M'23 y-o-y
Fixed business:
Retail services revenues 226.8 230.1 -1.4% 911.0 915.1 -0.4%
Wholesale services revenues 134.9 156.6 -13.9% 583.0 572.3 +1.9%
Other revenues 122.9 125.9 -2.4% 450.5 373.9 +20.5%
Total revenues from fixed business 484.6 512.6 -5.5% 1,944.5 1,861.3 +4.5%
Mobile business:
Service revenues 289.6 292.3 -0.9% 1,191.5 1,193.5 -0.2%
Handset revenues 96.3 93.2 +3.3% 324.3 300.2 +8.0%
Other revenues 5.9 5.4 +9.3% 21.7 17.4 +24.7%
Total revenues from mobile business 391.8 390.9 +0.2% 1,537.5 1,511.1 +1.7%
Miscellaneous other revenues 28.9 26.7 +8.2% 108.8 96.5 +12.7%
Total revenues 905.3 930.2 -2.7% 3,590.8 3,468.9 +3.5%
Other operating income 7.1 1.1 - 12.5 9.7 +28.9%
Operating expenses
Interconnection and roaming costs (101.7) (127.3) -20.1% (445.7) (442.9) +0.6%
Provision for expected credit losses (7.5) (9.2) -18.5% (34.4) (37.9) -9.2%
Personnel costs (94.2) (99.4) -5.2% (400.9) (421.0) -4.8%
Costs related to voluntary leave schemes (2.5) (4.8) -47.9% (33.8) (35.3) -4.2%
Commission costs (27.5) (25.0) +10.0% (97.7) (90.2) +8.3%
Merchandise costs (109.9) (127.8) -14.0% (388.8) (377.9) +2.9%
Maintenance and repairs (15.4) (22.1) -30.3% (87.2) (91.5) -4.7%
Marketing (18.4) (20.5) -10.2% (74.6) (74.3) +0.4%
Other operating expenses (172.8) (143.5) +20.4% (668.5) (525.4) +27.2%
Total operating expenses before depreciation, amortization and impairment (549.9) (579.6) -5.1% (2,231.6) (2,096.4) +6.4%
Operating profit before financial and investing activities, depreciation, 362.5 351.7 +3.1% 1,371.7 1,382.2 -0.8%
amortization and impairment
Depreciation, amortization and impairment (247.2) (173.2) +42.7% (703.3) (666.5) +5.5%
Operating profit before financial and investing activities 115.3 178.5 -35.4% 668.4 715.7 -6.6%
Income and expense from financial and investing activities
Finance income and costs (4.3) (2.3) +87.0% (21.0) (20.2) +4.0%
Foreign exchange differences, net - 0.5 - 0.7 3.1 -77.4%
Gains / (losses) from investments and other financial assets - Impairment 1.1 0.5 +120.0% 30.5 0.9 -
Total gain/ (loss) from financial and investing activities (3.2) (1.3) +146.2% 10.2 (16.2) -
Profit before tax 112.1 177.2 -36.7% 678.6 699.5 -3.0%
Income tax (47.6) (42.7) +11.5% (199.8) (167.8) +19.1%
Profit for the period 64.5 134.5 -52.0% 478.8 531.7 -9.9%
IV. GROUP CONSOLIDATED STATEMENT OF CASH FLOW
(€ mn) Q4'24 Q4'23 12M'24 12M'23
Cash flows from operating activities
Profit before tax 112.1 177.2 678.6 699.5
Adjustments for:
Depreciation, amortization and impairment 247.2 173.2 703.3 666.5
Costs related to voluntary leave schemes 2.5 4.8 33.8 35.3
Provision for staff retirement indemnities 4.7 1.7 6.3 4.8
Provision for youth account - - - (2.4)
Foreign exchange differences, net - (0.5) (0.7) (3.1)
(Gains) / losses from investments and other financial assets- Impairment (1.1) (0.5) (30.5) (0.9)
Finance costs, net 4.3 2.3 21.0 20.2
Working capital adjustments: 37.7 63.4 (3.5) 23.0
Decrease / (increase) in inventories 3.2 (7.8) 5.4 (4.9)
Decrease / (increase) in receivables 28.8 (24.7) (51.5) (99.3)
(Decrease) / increase in liabilities (except borrowings) 5.7 95.9 42.6 127.2
Payment for voluntary leave schemes (7.4) (11.2) (41.5) (39.9)
Payment of staff retirement indemnities and youth account, excluding (1.5) (2.2) (10.1) (8.8)
employees' contributions
Interest and related expenses paid (except leases) (2.9) (3.1) (16.7) (20.1)
Interest paid for leases (2.7) (2.6) (10.1) (9.2)
Income tax paid (109.0) (88.9) (227.7) (169.8)
Net cash flows from operating activities 283.9 313.6 1,102.2 1,195.1
Cash flows from investing activities
Sale or maturity of financial assets - 0.1 - 0.1
Purchase of financial assets - - (0.7) (0.8)
Net outflows related to disposal of subsidiaries/investments (0.6) (0.1) (1.8) (0.3)
Cash and cash equivalents of subsidiaries disposed - - (2.4) -
Repayment of loans receivable 1.2 1.8 7.2 7.2
Purchase of property, plant and equipment and intangible assets (166.7) (191.5) (599.7) (621.4)
Interest received 3.5 3.2 13.3 10.4
Net cash flows used in investing activities (162.6) (186.5) (584.1) (604.8)
Cash flows from financing activities
Acquisition of treasury shares (57.0) (48.0) (150.6) (177.0)
Expenses related to subsidiary's share capital increase - (0.1) - (0.1)
Proceeds from loans - - 40.0 80.0
Repayment of loans (40.0) (114.6) (40.0) (287.7)
Lease repayments (20.0) (21.2) (71.6) (82.9)
Financial liabilities related to digital wallets 0.3 2.0 3.8 1.3
Dividends paid to Company's owners (0.5) - (296.9) (249.9)
Net cash flows used in financing activities (117.2) (181.9) (515.3) (716.3)
Net increase/ (decrease) in cash and cash equivalents 4.1 (54.8) 2.8 (126.0)
Cash and cash equivalents, at the beginning of the period 462.1 519.1 463.9 590.1
Net foreign exchange differences 0.8 (0.4) 0.3 (0.2)
Cash and cash equivalents, at the end of the period 467.0 463.9 467.0 463.9
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