What:

Yesterday, Telecom Egypt (TE) released its consolidated financial results, covering the entirety of the year concluding on December 31, 2023. Here are the highlights…

Revenues:

Reaching EGP 56.7 billion, it surged by 28% YoY, with the largest contributor being data. In terms of YoY growth, segments ranked as follows:

International Direct Dialing: +76% YoY

Cable projects: +64% YoY

Infrastructure: +27% YoY

Customer Base:

For fixed voice and broadband, it grew 8% and 9% YoY, respectively. The mobile customer base, however, was stable YoY.

Net Profit: 

Recorded EGP 11.5 billion, witnessing a 25% YoY rise.

EBITDA

(Earnings Before Interest, Taxes, Depreciation, and Amortization): It surged by 30% YoY, hitting EGP 22.7 billion, which is a strong indicator of company profitability. The margin, a measure of how much profit a company makes on each dollar of revenue, stood at a solid 40%.

How?

This growth was fueled by the company’s solid operational performance and cost savings from a new national roaming agreement, which helped offset higher costs due to inflation.

Operating Profit:

It also saw a healthy 28% increase from last year, despite facing 27% higher direct costs.

Dividend Distribution:

The Board of Directors proposed a dividend payout of EGP 1.5/share, which translates to a dividend yield of ~3.84% based on yesterday’s stock price of EGP 39.08.

Now What:

In TE’s earnings release, CEO Mohamed Nasr highlighted the recent price increase as a significant boost to the company’s financial position.

He outlined TE’s focus for the year, emphasizing enhancements to existing services, introduction of new products, and expansion of offerings like the submarine cable footprint and 5G services.