VEON Ltd. Q4 FY2025 earnings call

• 2025 was a strong and transformative year with double-digit operational growth, accelerated digital strategy, strengthened balance sheet. Fourth quarter revenues grew 17% in USD, EBITDA 29% YOY. Full year revenues up nearly 10% in USD, EBITDA up 19%. Crossed $2 billion annual EBITDA with margins at 45.7%. - Digital services revenue accelerated, growing 84% YOY in Q4 and over 62% for full year, now over 17% of group revenue. EBITDA from digital services in 2025 was 207 million with 27.3% margin. - Executed asset-light strategy, completed sale of Pakistan Tower portfolio, deconsolidated TNS+, launched direct-to-sale connectivity with Starlink. - Unlocked shareholder value with Kyivstar listing on Nasdaq, secondary offering increasing float, Vyond's stake in Kyivstar worth approx $2 billion. - Growth outpaces inflation, pricing control strong. Multiplay customers drive growth, generating nearly four times ARPU of voice-only users and one-third churn rate. - Digital ecosystem scales with over 135 million active digital service users, 200 million three-month active digital service users, 33 million digital-only customers, total transaction value 55 billion (+50% YOY). - Enterprise platforms evolve, launched Buildex in Uzbekistan, around 2,000 engineers/data scientists building solutions, ad tech platform reaches over 98 million screens. - Augmented intelligence core, developing local language large models, customer care tools handle close to 1 million interactions monthly.

Group revenue reached $4.4 billion in 2025, growing 9.9% in U.S. dollar terms. Telecom and infrastructure revenues grew 3% even after consolidation, with like-for-like revenue growth of 11% for the year. Digital revenues grew more than 62%, reaching $759 million, representing 17% of group revenues for the full year. EBITDA from digital services in 2025 was 207 million with an EBITDA margin of 27.3%.

Expect revenue growth of 9-12%, EBITDA growth of 7-10%. CapEx intensity, excluding Ukraine, is expected to decline to 14-16%. Policy of continuing to repurchase at least $100 million of shares annually.

Today's presentation includes forward-looking statements which involve risks and uncertainties. Actual results may differ materially due to the risks detailed in Vyond's annual report and Form 20F and other filings with the SEC.

Q: Firstly, I've got some questions on the Pakistan Spectrum auction...

A: Max Brinley's question about Pakistan Spectrum auction, CapEx in Pakistan, and OLX Kazakhstan acquisition. Response includes details on spectrum acquisition, plans for 5G and 4G, CapEx discipline, and OLX Kazakhstan regulatory approval expectation.

Q: Yeah, thanks very much. First question is about sort of your revenue growth was strong here for the year...

A: Teodor O'Neill's question on separating pricing vs volume growth, digital services and portfolio changes. Response discusses transition to multi-play, digital revenue growth next phase and margin profile.

Q: Hi, Con, Roy, Anand. Good to see you again. Can I just... Can I just talk about capital allocation in the midterm?...

A: Adrian Cundy's question on capital allocation, buybacks, long-term capital allocation vision. Response talks about stock buyback policy, investors' preference for buybacks over dividends, disciplined acquisitions, and balance sheet situation.

Q: Hello, everybody. I guess I'm sort of interested by Ukraine...

A: Nicholas Payton's question on Ukraine business optionality. Response mentions future calls on Kiev Star operations and long-term vision for Ukraine's prosperity.

Q: Yeah, thanks, guys. Great, obviously, to see the accelerating trends. I mean, really, you know, very strong in the quarter. I just want to touch on the settlement with Dabi Group...

A: Chris Hall's question on settlement with Dabi Group. Response explains the settlement, welcoming back investor, and clarity on bonds.

Q: All right, so you're acquiring TPL insurance with expected closing mid-2026. Can you walk us through the embedded insurance thesis...

A: Vincent Fernando's question on TPL insurance acquisition. Response discusses embedded insurance in Pakistan, TPL's role, and digital banking license pursuit.

Q: Thank you. You're devising local market LLMs in concert with some very prominent international tech companies...

A: Matthew Harrigan's question on local market LLMs. Response talks about working with partners to develop local language models, sovereign AI opportunity.

Q: Hello, everyone. Thanks for the presentation and congrats on the numbers. I have two questions...

A: Ahmet Mustafa's questions on 2026 guidance margin compression and Pakistan spectrum deployment timeline. Response addresses EBITDA guidance, impact of oil prices on guidance, and Pakistan spectrum deployment timeline.

Q: what are the plans for the 2027 bonds? Do they plan to come to market this year to refinance it? Are there any more acquisitions in the pipeline? Do we expect FCF to be positive this year? Is there a leverage target?

A: Burak's response on plans for 2027 bonds, intention to address bonds this year, disciplined approach to acquisitions, expectation of positive FCF, and leverage target.

Q: Hi, Con. I'm going to come back to digital revenues and EBITDA in this question...

A: Adrian Cundy's question on digital revenues midterm goal. Response mentions aim for 50-50 revenue split between digital and other segments in three years, organic growth and small acquisitions for growth.

Q: hi guys uh thank you for the opportunity so my question is like with jazz and mmbl now established as a digital financial ecosystem in pakistan and with ppl also coming in what do you think would be the relevant next steps...

A: Ali Zaidi's question on next steps for digital financial ecosystem in Pakistan and standalone IPO. Response talks about upgrading to full digital banking license in Pakistan and future growth opportunities.