Ooredoo net profit jumps 28% to QR3bn in 2023

Ooredoo Group posted a net profit of QR3bn in 2023, up 28% on QR2.4bn recorded in 2022.

Normalised net profit grew by 16% y-o-y to reach QR3.3bn in the same period from QR2.8bn.

Ooredoo stated that normalised net profit is net profit adjusted for foreign exchange, impairments, and exceptional items (QR446mn gain from the NMTC legal case, Meeza IPO gain of QR139mn, QR56mn gain on the disposal of towers, and QR37mn gain on data centre carve-out in Indonesia).

The strong net profit figures are testament to the group’s ongoing focus on profitability and efficient operational management.

Revenue grew ahead of FY 2023 guidance target with an increase of 2% y-o-y to QR23.2bn from QR22.7bn driven by sustained growth in Iraq, Algeria, Kuwait, and Maldives. This was partially offset by a decline in revenue in Qatar and Tunisia, as well as in Myanmar and Palestine (due to foreign exchange depreciation).
Ooredoo’s focus on profitability led to an EBITDA of QR9.7bn, up by 4% y-o-y. EBITDA margin expanded by 1pp to 42%, thanks to healthy service revenue growth and a disciplined approach to cost control. The strong profitability improvement in Iraq, Algeria, and Kuwait was partially offset by lower EBITDA in Qatar, Oman, and Tunisia.
Group capital expenditure (CAPEX) spending stood at QR2.8bn for FY 2023, reflecting a 3% y-o-y growth.
Normalised free cash flow increased by 6% y-o-y to QR6.8bn supported by EBITDA expansion. Solid performances in Iraq, Kuwait, Algeria, and Maldives contributed positively to additional FCF generation in the year.
Ooredoo Group retained its robust investment grade rating in 2023. Leverage (net debt/EBITDA) ratio of 0.7x, 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 96% of the debt is structured on a fixed rate basis. Liquidity remains strong, with QR10.5bn in cash reserves and QR5.0bn available in undrawn facilities.
Across the group, most of the operations added customers to the network closing the year with a total customer base of 57.6mn, up by 3% y-o-y. Including IOH, the customer base reached a total of 156.4mn.
The board will recommend the distribution of a cash dividend of QR0.55 per share at the Annual General Meeting to be held in March. This represents an increase of 28% y-o-y and a payout of 59% of normalised earnings and is in line with the dividend policy. Ooredoo Group has a sustainable and progressive dividend policy which aims for a payout in the range of 40% to 60% of normalised earnings.
Ooredoo chairman Sheikh Faisal bin Thani al-Thani said, “Ooredoo strives to enhance people’s digital lives and deliver value to its stakeholders. In 2023, we continued to provide best-in-class connectivity and deliver superior customer experience by investing in our capabilities and infrastructure. Revenue grew by 2% to QR23.2bn while reported net profit increased by a healthy 28% to QR3bn, a historical high.
“I am pleased to announce that the board of directors will recommend a cash dividend distribution of QR0.55 per share, in line with our sustainable and progressive dividend policy, at the Annual General Meeting in March.”
He added: “Our success is facilitated by our ongoing digital transformation, which not only contributes to our resilience but also empowers us to capitalise on market opportunities and position ourselves for long-term sustainable growth. Our adaptability in navigating a dynamic market landscape ensures sustained success and attractive returns. Looking forward, we remain dedicated to our strategic path that unlocks capital and enhances value for our stakeholders, solidifying our position as an industry leader.”
Aziz Aluthman Fakhroo, managing director and CEO, Ooredoo Group, said: “2023 was a noteworthy year. We improved our financial position and made substantial progress against our strategic priorities. We delivered financial results in line with our full-year 2023 guidance. Revenue grew by 2% to QR23.2bn. EBITDA increased by 4% to QR9.7bn and the EBITDA margin expanded by 1pp to 42%, supported by topline growth and a disciplined approach to costs.
The growth for the year was driven by solid performances in Iraq, Kuwait, Algeria, and Maldives. The group achieved an all-time high reported net profit of QR3.0bn, up by 28% and strong normalised FCF generation of QR6.8 billion, up 6%.”
He added: “We announced the establishment of the region’s largest independent tower company in partnership with Zain and TASC at a $2.2bn valuation, marking a significant milestone. These accomplishments are the result of teamwork, and I am immensely proud of my colleagues’ dedication.
“As we look ahead, we will continue to drive operational efficiency for profitability and cash generation while advancing our strategic priorities as we evolve toward becoming the leading digital infrastructure provider in the region.”