In 2023, Vodafone Ukraine showcased resilience and positive momentum across all key operational and financial indicators. Despite the impact of the ongoing war, the company not only preserved but also increased its investments in the development and support of Ukraine’s telecommunications infrastructure. Compared to the previous year, Vodafone’s investments surged by an impressive 58%, reflecting a commitment to enhancing business efficiency.
Financial and Operational Highlights
Revenue Growth: Vodafone’s revenue grew by 9% to reach UAH 21.6 billion in 2023. Key drivers included a focus on expanding fixed-line services, increased data usage, and growth in both mobile and fixed-line service revenues.
OIBDA Increase: The company achieved a 13% increase in OIBDA, which reached UAH 12.7 billion. The OIBDA margin also improved to 58.7%, representing a 1.8 percentage point increase.
Net Profit Surge: Vodafone’s net profit soared to UAH billion, a remarkable fivefold growth compared to 2022. Factors contributing to this substantial increase included currency stabilization (due to NBU’s managed exchange rate regime), reduced losses and impairment related to assets located on non-controlled territories, partner discounts, and overall business efficiency gains.
Investment Milestone: The generated profit allowed Vodafone to reinvest in network coverage and maintain network stability. Notably, the company achieved record-breaking investment levels, surpassing even pre-war figures from 2021.
Vodafone’s commitment to Ukraine’s telecommunications infrastructure underscores its resilience and determination to thrive despite challenging circumstances.
Investments
In 2023, Vodafone’s investment in Ukraine’s infrastructure amounted to UAH 5.7 billion. Throughout the two years of full-scale war, Vodafone invested a total of UAH 9.3 billion in the country.
Despite continuous network damage and the need for equipment restoration, the operator continued to expand. During the active phase of the war, Vodafone successfully brought 5,500 base stations online, enhancing coverage and network capacity. Over these two years, data traffic increased by 1.5 times. On average, a Vodafone data customer uses approximately 9 GB of mobile internet per month. This surge in usage contributed to an increase in the ARPU, reaching UAH 107.2 per month in 2023.
Expanding the network by 40% allowed Vodafone customers across Ukraine to consume more content while maintaining high-quality mobile internet. In the third and fourth quarters of 2023, Vodafone emerged as the leader in mobile internet speed in Ukraine, as confirmed by user tests using Ookla’s Speedtest®.
Subscriber Base
Systematic investments in network development and restoration, coupled with attractive tariff initiatives, positively impacted the subscriber base. In 2023, Vodafone managed to increase its customer count. As of the end of the year, 15.9 million people in Ukraine use Vodafone services, representing a 3.2% growth compared to 2022.
Additionally, more than 2 million Vodafone customers remain abroad and continue to use Vodafone services with Ukrainian tariffs. Since the onset of the full-scale invasion, Vodafone has supported Ukrainians seeking refuge in European countries. Most tariffs include free access to the “Affordable Roaming” service in 30 countries. This service provides 10 GB of mobile internet and 100 minutes for calls to Ukrainian and destination-country subscribers, subject to payment of the Ukrainian service package.
Fixed Internet
Vodafone Ukraine has made significant strides in its fixed business segment. In 2023, Vodafone continued its development of fixed business by increasing investments in the expansion of new fibre optic lines based on Vega, a company within the Vodafone Ukraine group. Additionally, Vodafone acquired a new asset, purchasing 90.6% shares of LLC “Freenet”.
During the past year, the company actively expanded its coverage in the cities of its presence and started the construction of the GPON network in Mykolaiv and Ivano-Frankivsk. In 2023, a network was built in 3,125 apartment buildings with the possibility of access to high-speed Internet for 411,426 households.
In total, access to the Vodafone Gigabit Net service is already available in more than 6,000 homes in Ukraine.
Vodafone tripled its fixed internet user base using GPON technology, which has proven to be the most reliable and energy-independent access technology for home and office internet. Thanks to the development of its own network and the acquisition of a new provider, Vodafone has now entered the top 5 fixed internet providers in terms of user count.
Vodafone Retail
Retail revenue increased by 16%, reaching UAH 773 million in 2023, contributing to 3.6% of the entire Vodafone Ukraine group’s revenue. Vodafone Retail improved the efficiency of its retail points, nearly doubling the number of available brands in Vodafone stores. The company received industry recognition, winning the “Retailer of the Year in the Portable Electronics Segment” award from the Association of Retailers of Ukraine (RAU), as chosen by Ukrainian consumers. Throughout the year, Vodafone opened 5 new stores, bringing the total number of retail outlets to 430: 92 company-owned stores and 338 dealer stores.
Vodafone’s Commitment to Ukraine
Vodafone Ukraine has made substantial investments in supporting the country and its citizens. Since the onset of the full-scale invasion, Vodafone has been dedicated to ensuring millions of citizens remain connected with their loved ones and have access to information during these challenging times, regardless of their mobile account status.
Vodafone has launched a series of social and charitable initiatives, including humanitarian and Financial Assistance:
• Providing direct financial aid and humanitarian support.
• Procuring emergency vehicles and medical equipment.
• Initiating the “League of Warmth” charity challenge, aimed at insulating maternity hospitals.
• Supporting children who have lost parents due to the war.
In total, Vodafone’s social investments during 2022-2023 amounted to UAH 1.7 billion
For more information, please contact:
Vodafone
Press service
press@vodafone.ua
About Vodafone
Vodafone is one of the world’s largest telecommunications companies, providing a wide range of services including mobile voice, data transfer, messaging, fixed broadband and cable television. The Company operates across 17 countries and partners with mobile networks in 43 countries. As of 31 March 2024, Vodafone provides services to over 340m mobile customers and 28m fixed broadband customers, 20m TV customers and connects more than 162m IoT devices. For more information, please visit www.vodafone.com.
Vodafone Ukraine is a leading telecommunications company that provides high-speed 3G and 4G Internet services and fixed broadband services. The Vodafone’s investments during the active construction of high-speed Internet networks in 2015 –2023 exceeded 42 billion UAH. The record investments have ensured the technological leadership and the development of new technological services – Internet of Things (IoT), technologies and solutions for Smart City, big data analytics, fintech services, cloud services. Vodafone has 15.9 m customers in Ukraine. Since December 2019, Vodafone Ukraine is part of NEQSOL Holding.
About NEQSOL Holding
NEQSOL Holding is a diversified group of companies operating across the energy, telecommunications, hi-tech, and construction industries.
The group of companies operates in the Netherlands, the UK, the USA, Turkey, Azerbaijan, Ukraine, Georgia, Kazakhstan and the UAE.
Along with its plans for further business development in Ukraine, the Holding opened its representation office in Ukraine at the end of 2020.
German MC-Bauchemie intends to invest EUR 1.5 mln in the expansion of dry construction mixtures production in Berezan (Kiev region), MC-Bauchemie Ukraine director Artem Priymachenko told Interfax-Ukraine agency.
“We intend to build a new line for special construction materials, such as a variety of polymer-cement mixes for structural repair of concrete, toppings for industrial floors, waterproofing materials, highly functional adhesives for tiles. The approximate volume of investments is EUR 1.5 mln,” he said.
According to Priymachenko, the investments will be made at the expense of MC-Bauchemie’s own funds. The discussion of war risk insurance is underway now.
“We are now in the procedure of obtaining a guarantee from international organizations for military risks. We are considering options – the German government or MIGA from the World Bank,” he said.
According to the company’s plans, the new line in Berezan could be launched at the end of 2025.
Founded in 1961, MC-Bauchemie Group is one of the leading international producers of construction chemicals and technologies. With more than 2,500 employees, it is represented in more than 50 countries.
According to the data of opendatabot, LLC “MC-Bauchemie” (33482370) was founded in 2005, authorized capital 333,8 thousand UAH. Revenue in 2023 356 million 836 thousand UAH, which is 2.6 times higher than the results of 2022 and 9% higher than pre-war 2021. Net profit for 2023 UAH 55 million 618 thousand, in 2022 there was a net loss of UAH 18 million 625 thousand.
construction mixtures, INVESTMENTS, KYIV REGION, MC-Bauchemie
The Steering Board of the Ukraine Investment Framework, set up by the EU on April 17 under the Ukraine Facility instrument, has allocated more than EUR1bn of funding to de-risk investments, mainly of small and medium-sized enterprises in Ukraine, through International Financial Institutions (IFIs) and banks, Ukraine’s Deputy Economy Minister Oleksiy Sobolev said.
“That is, this year, financing for SME development will be enough,” he said at Ukraine’s Future Summit in Brussels on April 18.
Sobolev called for more active trade and joint ventures with Ukrainian companies, because the above mechanism will provide leverage and additional guarantees.
“Thanks to the Ukraine Plan and Ukraine Facility, you will have available financing for business expansion in Ukraine, and what we need right now will be available. This year it will be available through Ukrainian banks and through MFIs: EBRD, EIB, IFC, KfW”, – said the Deputy Minister of Economy.
He specified that about 20 Ukrainian banks participate in these programs.
“So, in fact, you can apply to your Ukrainian bank, and he will provide additional financing to your companies,” – explained Sobolev.
Business can cope with the problem of staff shortage in Ukraine by investing in technological products and process automation, says Ruslan Shostak, owner of Eva and Varus chains and president of TERWIN Corporation.
“I don’t see a big problem (with staff shortage). Yes, it exists, you can’t turn a blind eye to it, but according to statistics, not so many people left Ukraine. Our whole business was inefficient in terms of human resource utilization, which made us uncompetitive with similar businesses in Europe and the world. But there is one solution for this: money. We don’t have money to reconstruct our production facilities and enterprises. If we have money, software products, new robotic equipment, we will be able to solve this issue,” Shostak told Business Wisdom Summit in Kyiv on Wednesday.
According to Shostak, despite a slight outflow of customers, his business is showing growth: last year’s growth was almost 100% in online and 30% in retail. In addition, new logistics hubs are being built in Kyiv, Lviv, and Dnipro.
Shostak noted, while in Ukraine business development is slowed down due to the war and difficult economic situation, global business is undergoing changes and using new opportunities, including artificial intelligence.
“Now we are focusing on geopolitics, but in the next 20 years we will face global economic problems, change of specialties, professions. It is artificial intelligence that is driving the most powerful changes right now,” Shostak believes.
As reported, in October 2023, 17 companies managed by Shostak, which collectively employ 30 thousand people, merged into TERWIN (TERWIN). We are talking about Omega LLC, Rush, Tervin Group, Tixid, Tavria Hub, Instant, Formsite, Digamma, Milton Group, Saltora Plus, Firma Ariant, New Construction 2017, Altair D, Apex N, Aspect D, Lattero, Charitable Foundation Ruslan Shostak BU. The total assets of the corporation are estimated at $1.6 billion. The combined revenue of the companies reached $2 billion in the pre-war period and was expected to reach $1.7 billion in 2023.
In November 2023, Shostak and UkraineInvest CEO Serhiy Tsivkach signed a memorandum on further support of the project for the construction of logistics hubs in four regions of Ukraine (Odessa, Lviv, Dnipropetrovsk, Kyiv) with a total investment of more than $500 million.
BUSINESS, INVESTMENTS, staff shortage, TECHNOLOGIES, TERWIN Corporation, UKRAINE
The Spanish government intends to cancel the program that provides foreigners with “golden visas” in exchange for real estate investments, the Financial Times reports, citing a statement by Spanish Prime Minister Pedro Sanchez.
Currently, citizens of non-EU countries can obtain a Spanish residence permit for a period of three years by investing at least EUR 500 thousand in real estate in the country.
The abolition of the program will improve the situation with the availability of housing in Spain, Sanchez said.
“Currently, 94 out of 100 of these visas are issued for real estate investments in large cities that are already facing a very difficult market. Those who already live there, work and pay taxes, can hardly find decent housing,” the prime minister said.
At a meeting on Friday, the government approved a procedure for providing compensation for the cost of engineering and transport infrastructure built by an applicant/investor with significant investments and the costs of connection and connection to engineering and transport networks necessary for project implementation.
“…approved the last regulatory document necessary to launch the mechanism of state support for projects with significant investments. Investors who are ready to implement projects in Ukraine worth EUR 12 million or more will receive maximum assistance and support from us in the form of support, tax and customs benefits, compensation for the cost of constructed engineering and transport infrastructure facilities or connection to engineering and transport networks, etc.”, the release of the Ministry of Economy quotes First Deputy Prime Minister and Minister of Economy Yulia Svyrydenko.
She added that this year the state budget has allocated UAH 3 billion to support such investors.
The Ministry of Economy clarified that investors who plan to implement a project in Ukraine worth EUR 12 million or more with a duration of up to 5 years in the areas of processing industry, mining for further processing or enrichment, transport, logistics, education, research, healthcare, waste management, art, culture, tourism, sports, and electronic communications will be able to receive state support.
To receive support, the applicant (a resident or non-resident legal entity) must submit an application to the Ministry of Economy together with the relevant documents for the evaluation of a project with significant investments, after which the Ministry must evaluate the investment project and provide an opinion on the feasibility/inefficiency of its implementation and the conclusion of a special investment agreement or refusal to conclude it.
After that, a special investment agreement will be concluded between the Cabinet of Ministers, a local government body (if state support is provided by such a body for the implementation of a project with significant investments), an investor with significant investments, and the applicant.
In addition, to support the preparation and implementation of an investment project with significant investments, the applicant must contact UkraineInvest for information and advisory assistance.
The Ministry of Economy emphasized that investors can receive several types of support from the state, which amount to up to 30% of the amount of an investment project with significant investments, in particular: the preemptive right to use state or communal land plots, compensation for the cost of building engineering and transport infrastructure and the cost of connecting to engineering and transport networks, tax benefits, duty-free import of necessary equipment, as well as exemption from compensation for forestry losses and other costs.
According to the report, projects should include the construction, modernization, technical or technological re-equipment of the relevant investment objects and the creation of new jobs. The investor needs to create at least 10 jobs with a salary at least 50% higher than the average salary in the region for this type of activity, or 30 jobs with a salary at least 30% higher than the average salary in the region for this type of activity, or 50 jobs with a salary at least 15% higher than the average salary in the region for the same type of activity.
