Telecom Egypt FY21 Results: 33% Hike in Proposed Dividends

Telecom Egypt has released its FY21 financial report and following are the key highlights.

FY 2021 key highlights

• Consolidated revenue grew 16% YoY, landing at EGP 37.1bn. The growth was mainly driven by a 30% YoY increase in data revenues, constituting 67% of top line growth, and a 26% YoY increase in infrastructure revenue.
• Customer base grew on all fronts with fixed voice and broadband growing 12% and 16% YoY, respectively, and mobile customers growing 28% YoY, reaching 9.4mn.
• EBITDA came in at EGP 14.2bn with a strong margin of 38% on an improved revenue mix.
• Operating profit grew 42% YoY thanks to a high margin revenue mix and continued cost containment efforts, despite a 19% YoY growth in D&A.
• Net profit reached EGP 8.4bn, growing 74% YoY driven by strong operational performance and higher investment income from Vodafone (+52% YoY).
• In-service CapEx reached EGP 10.1bn, representing 27% of total revenue, while cash CapEx reached EGP 13.6bn (37% of sales).
• Net debt to EBITDA declined 0.9x, compared to 1.6x last year, while the effective interest rate declined to 5.3% vs. 5.9% in FY 2020.
• Operating cash flows doubled YoY, reaching an all-time high of EGP 16bn.
• Dividend distribution proposed by the BoD is EGP 1/share (+33%YoY).

“I am very proud of our FY 2021 results that reflect Telecom Egypt’s outstanding performance across the board. Our top line grew 16% YoY, mainly attributable to a 30% YoY spike in data revenue, while EBITDA climbed 28% YoY, recording a strong margin of 38%. Our net profit has hit a record-high EGP 7.7bn, organically up 52%. Our full year results clearly demonstrate that the strategy we adopted to reach financial and operational excellence is already bearing fruit, as we continue to see our growing margins translate to strong organic free cash flows of EGP 3bn, after excluding special dividends from Vodafone Egypt of around EGP 4bn.
Our remarkable performance is credited to our unique and valuable product offerings that cater to all customer segments, our internal system upgrades, and our ability to capitalize on our distinctive infrastructure that spans both Egypt and the region. Additionally, Telecom Egypt continued to contribute strongly to national digitization projects, including the new phase of the digital transformation initiative that involves connecting nationwide governmental buildings with fiber, in addition to the first phase of Hayah Karima, which involves connecting about 1,400 villages with Fiber to the Home (FTTH) technology.
Strategically, we have resumed our efforts to deleverage and decrease our cost of debt by utilizing our higher operating cash flows and the special dividends we received from Vodafone Egypt, which was a result of the new modified shareholders’ agreement with Vodafone Egypt, which provides us with visibility on our investment and expected returns going forward.
To conclude, 2021 is evidence that Telecom Egypt is a forward-focused company committed to maximizing shareholder returns and enabling Egypt’s sustainable development strategy. We look forward to continue delivering on our strategic goals throughout 2022.”

Adel Hamed, Managing Director and Chief Executive Officer, Telecom Egypt