UAE's e& nets $7.1bn revenue in H1; profit soars to $1.2bn
ABU DHABI, August 1, 2023
Top UAE telecom company e& has reported solid growth during the first six months with consolidated revenues of AED26.6 billion ($7.1 billion), up 1.1% over last year, while its consolidated net profit surged to AED4.7 billion ($1.25 billion), mainly due to a strong performance in its core telecom business.
Also in a major development, e& today (August 1) announced its expansion into Central and Eastern Europe through a strategic deal with PPF Telecom.
An international investment group, the PPF Telecom was founded in the Czech Republic in 1991 and has grown to manage operations in 25 countries around the world.
e& said it had signed a binding agreement with PPF Group to acquire a controlling stake (50% + 1 share economic stake) in its assets in Bulgaria, Hungary, Serbia, and Slovakia.
The perimeter will comprise of the Yettel Bulgaria, Yettel Hungary, Yettel Serbia, and O2 Slovakia operations, with more than 10 million subscribers and leading positions in their respective markets, as well as the Cetin and O2 Networks infrastructure businesses in these countries.
According to e&, the upfront consideration for the acquisition is €2.15 billion. The transaction is also subject to up to €350 million in earn-out payments to PPF if the PPF Telecom assets exceed certain financial targets within the three-year period after closing and is subject to a claw back if such financial targets are not achieved.
The PPF Telecom’s infrastructure businesses in each of these four countries are fully carved out and managed independently of the service companies. Through the investment, e& will own a 50% + 1 share economic stake in both the service and infrastructure companies.
e& and PPF aim to realise significant scope for synergies between the two groups, with sizeable opex and capex savings and multiple opportunities for the roll-out of the leading suite of e&’s B2B and B2C digital products in CEE.
The current PPF Telecom CEO Balesh Sharma will be continue in his post and ensure continuity of operations while drawing on the broad expertise of PPF Telecom’s teams in their markets.
On its six-month results, e& said its consolidated ebitda reached AED12.8 billion for the period, resulting in an ebitda margin of 48%.
In the UAE, etisalat by e& had recorded a total of 13.9 million subscribers, up 5.1% over last year, while the Group’s aggregate subscribers reached 165 million, a YoY increase of 3.1%.
Chairman Jassem Mohamed Obaid Bu Ataba Alzaabi said: "e&'s performance during the first half of the year reinforces the resilience of our business model despite the challenging global macroeconomic environment. This was also the result of our teams' relentless efforts to remain committed to our vision and drive sustainable growth, making a positive change in the societies we serve while adding value to our shareholders."
"Today we are also delighted to announce e&'s strategic expansion into the European market. With this move, we join forces with PPF to build and expand our international footprint in the attractive Central and Eastern Europe region and beyond," noted Alzaabi.
"It is the next step of our transformation into a global technology group, offering e& multiple avenues to roll-out its leading suite of B2B and B2C digital products in the CEE with significant synergies," he stated.
The acquisition aligns with e&’s strategic ambition to accelerate international growth and diversify geographically. This represents an unparalleled opportunity to establish a strong presence and foster development within the dynamic CEE region, he added.
