Business news from Ukraine

Lifecell increased its profit by 71.8% in fourth quarter of 2022

10 March , 2023  

Ukrainian mobile operator lifecell in the fourth quarter of 2022 increased net profit by 71.8% compared to the same period last year – up to 408.8 million UAH, while in general it increased by 59.2% – to 972.3 million UAH.
According to the report of the parent company Turkcell on its website, the revenue of lifecell in the fourth quarter of 2022 increased by 8.3% – to 2.607 billion UAH, and for the whole of 2022 – by 11%, to 9.41 billion UAH.
EBITDA in the fourth quarter increased by 14.1% to UAH 1.505 bln, and for the year as a whole by 14.6%, to UAH 5.45 bln.
At the same time, the capital expenditures of the company in the fourth quarter decreased by 24.4% – to UAH 997.4 million, and for the year as a whole by 16.3%, to UAH 3 billion.
Base of active subscribers of lifecell in the fourth quarter increased from 8.2 million to 8.5 million, but this is less than a year ago, when there were 9.2 million people. At that ARPU (average revenue per user) among active users in 2022 increased by 10% – up to 91.5 UAH. At that if in the first half of the year ARPU was slightly decreasing then in the second half rose quickly enough – from 82.8 UAH to 95.4 UAH in the third quarter and to 104.5 UAH in the fourth quarter thanks to price adjustments and growth in data usage.
Due to the war, as of December 31, 2022, 23% or about 9 thousand of the company’s mobile communication stations in Ukraine were out of operation. The state of the stations in the occupied territories is unknown, the report said. At the same time, 92% of the company’s stores were working and returned to prewar levels in the fourth quarter. It is noted that the company’s operating systems worked steadily, as well as the banking system, including payments.
It is specified that as of December 31, 2022, the amount of write-downs of assets in the Russian-occupied territories recognized in the consolidated financial statements is 214.2 million Turkish liras (about $11.3 million).
As the risks that may affect the company’s activities, the ongoing military operations and changes in the hryvnia’s exchange rate due to the economic situation in the country are noted. The risk of loss of control or expropriation of the company’s assets in Ukraine due to the actions of the Russian Federation is also singled out.
The company plans to focus on ensuring the safety of its employees and providing quality service to Ukrainian consumers.
The activities of the parent company turkcell were seriously affected by the earthquake in Turkey, due to which the company had to adjust its financial results for 2023. The negative impact on income is estimated at about 1.5 billion Turkish liras (about $79 million). It is reported that on the first day of the disaster almost 3.3 thousand base stations in the region stopped working due to power outages and destruction. One mobile tower and 150 base stations were destroyed. 1,200 employees were sent to the affected regions to carry out repair work. 250 mobile communication stations were deployed and 1.4 thousand power generators were installed.
Lifecell is the third largest mobile operator in Ukraine. The company Turkcell (Turkey) is the owner of 100% of shares of Lifecell. The share of Ukraine, where its subsidiaries UkrTower, Global LLC and Paycell LLC also operate, accounts for 8.9% of Turkcell’s total revenue and 14% of its non-current assets.