PJSC Ukrtelecom in January-March 2019 increased EBITDA by 11% compared to the same period in 2018, to UAH 427 million, director general of the operator Yuriy Kurmaz has said at a press conference in Kyiv.
According to him, EBITDA margin for this period increased by 2 percentage points, to 26%.
Net income for the reporting period rose by 3%, to UAH 1.665 billion.
Kurmaz added that income from telecommunication services in the first quarter of the current year decreased by 1.4% compared to the first quarter of 2018, to UAH 1.416 billion.
In January-March, the operator provided services to private subscribers for more than UAH 922 million, business users for UAH 348 million.
At the same time, Kurmaz refused to voice the net financial result for the first quarter.
“I think it is inappropriate to talk about net profit for the first quarter, given the fact that from January 1 of this year a number of financial reporting standards have changed significantly, significantly influencing net profit. At the same time, I’d like to note that in the first quarter we achieved substantial profit,” he said.
Ukrtelecom will invest around UAH 270 million in the development of the high-speed fiber optic Internet network using GPON technology in almost 300 small towns and villages. Almost UAH 135 million was raised from Slovenia’s SID Bank, a promotional development and export bank.
“The start of construction of the fiber optic network is scheduled for the middle of May. The first connections to the new network will be already in July,” the operator said on Tuesday.
According to the report, the project is designed for two years and will be implemented jointly with the Iskratel telecommunications company. It provides for the construction of more than 3,500 km of fiber optic lines and subscriber access speeds of up to 200 Mbit per second, with the ability to use Internet telephony and interactive television. The partner company was selected based on the results of the tender for a comprehensive solution for the construction of the network, including construction and installation works, supply of equipment and startup works, the company said.
“The loan is secured by the insurance policy of SID bank to cover commercial and non-commercial risks. In this project, SID bank acts as an export credit agency,” Ukrtelecom said.
PJSC Ukrtelecom continued expanding the geography of Internet coverage in 2018 and connected almost 60 Ukrainian towns and villages to the Internet, according to the operator’s website.
“In 2018, access to the World Wide Web became available to residents of almost 60 other settlements. Of them, broadband access services based on GPON [Gigabit Passive Optical Network] technology became available in 44 settlements whose residents can use high-speed Internet services,” the operator said.
In 151 towns and urban-type settlements, Ukrtelecom subscribers who used ADSL technology were offered to connect to an optical network using FTTB technology.
Now the operator provides Internet access in almost 2,260 cities, towns and villages in Ukraine.
As was reported, Ukrtelecom in January-September 2018 posted about UAH 449 million in net profit, which was 29.62% down on the same period of 2017 (UAH 638 million).
Ukrtelecom is Ukraine’s largest fixed-line operator. It is the only founder and participant of LLC 3Mob, a 3G / UMTS mobile operator.
Public joint-stock company Ukrtelecom has designed a project to connect remote settlements to the broadband Internet access service, which could cover 8,000 villages where 6 million residents are living, during two years, Director for Mass Market Segment at Ukrtelecom Denys Zakharenko said at the presentation of the project in Kyiv on Monday. The total cost of the project is UAH 6 billion, including UAH 3.2 billion (53.3%) of government investment.
He said that all villages with schools (6,900) and villages located close to them with over 100 households will be included in the project.
Ukrtelecom said that mass connection would ensure the coverage of 40% of the total number of rural residents in Ukraine with the broadband Internet access service, which would cut the gap between cities and small towns and villages by 75%, as the share of rural areas in Ukraine where the service is not provided would decline from 56% to 16%, from 8.3 million to 2.3 million people.
According to the calculations of the operator, some 58,000 km of networks should be built to cover 8,000 villages.
The operator said that 14,000 villages are not covered by the project. A total of 2.3 million residents live there. This could be a ground for the second wave of connections.
Thanks to the implementation of the project, broadband Internet access saturation in Ukraine would grow by 4.4%, and GDP would grow by 0.6%, which in the prices of 2018 is around UAH 20 billion. Growth of the national budget’s revenue could be UAH 5.4 billion.
Zakharenko said that the buyback period for government investment could be two years thanks to the increase in payment of taxes.
Ukrtelecom Director Yuriy Kurmaz said that the project will be presented to the government and parliament.
Ukrtelecom in January-March 2018 received UAH 153 million of net profit, which is 24.4% more than for the same period in 2017, company director general Yuriy Kurmaz has said at a press conference in Kyiv. According to him, net income for this period fell by 2.9%, to UAH 1.615 billion.
EBITDA decreased by 1.3%, to UAH 383 million, while the EBITDA margin increased by one percentage point to 23.7%.
Kurmaz added that revenue from telecommunications services in the first quarter of this year decreased by 5% compared to the same period last year, to UAH 1.435 billion.
In January-March the operator provided fixed-line telephony services worth UAH 747.3 million, while by the end of the quarter it serviced 4.5 million active telephone lines.
Revenues from providing broadband Internet services for this period rose by 4.1%, to UAH 455 million. At the same time, the operator serves 1.445 million subscribers in more than 2,200 settlements.
By the end of the first quarter, Ukrtelecom serviced 3.6 million fixed-line subscribers, 1.3 million subscribers to Internet access services, and 93,000 TV subscribers in the B2C segment. Revenues in this segment from telephony decreased by 6.8%, to UAH 562 million, revenues from providing access to the Internet grew by 0.6%, to UAH 322 million.
The Supervisory Board of PJSC Ukrtelecom is satisfied with the implementation of the company’s strategic development program adopted in 2014, the communications provider said. “A group of experts of a leading international consulting company has completed the evaluation of the implementation of Ukrtelecom’s strategic development program. Taking into account the impact of a number of macroeconomic and geopolitical factors, they confirmed that at the end of 2017 last year’s targets were achieved: the revenue target by 104%, EBITDA by 16.7%, that for the number of subscribers by 91%,” the company said in a statement.
According to the company, in February 2018, its supervisory board instructed international experts to conduct an independent assessment of its strategic development, comparing the results achieved with the target indicators of the program. At the same time, the communications provider has not disclosed the name of the auditing company.
According to the report, the operator outstripped the updated targets of 21 out of the 24 strategic initiatives, including topped the revenue target – by 4% (by UAH 6.654 billion in 2017), EBITDA by 67% (by UAH 1.854 billion), EBITDA margin by 11 percentage points (by 28.1 percentage points).
At the same time, in 2017, Ukrtelecom fulfilled its target for the total number of subscribers (telephony and broadband) by 91% (6.622 million).
The evaluation of the implementation of Ukrtelecom development strategy was carried out with regard to the impact of significant external factors, in particular the cessation of its activities in the country’s temporarily occupied territories; restrictions related to post-privatization obligations and litigations; debts to the company by state and local budgets (including for subsidized categories of the population); massive malicious damage to infrastructure (including theft of copper cable); regulatory restrictions in landline communication (tariffs falling behind inflation), as well as the impact of macroeconomic factors (including devaluation of the national currency, increase in the minimum wage) and market dynamics in general, the company said
“Despite the number of negative external factors limiting investment in development, the assessment confirmed that we are moving along the path outlined by the long-term development strategy. Ukrtelecom is developing as a national telecom operator and industry leader,” the company’s director, Yuri Kurmaz, was quoted as saying.
According to the consultants, Ukrtelecom’s share in the total revenues of the Ukrainian b2b communications market (Internet access, landline communications and data transmission services) by the end of 2017 was 35% (an 8% increase from 2013).
