Telecom Egypt (TE) made profits worth EGP 6.7bn during the first half (1H) of this year, according to the company’s business results.
The company’s total revenues amounted to EGP 28.1bn, achieving a growth of 38% compared to the same period of the previous year. This growth was driven by an increase in the wholesale business units’ revenues by 75% compared to the same period of last year. This increase constituted 71% of the total growth, followed by the outstanding performance of the business units.
Telecom Egypt showed a growth in its customer base at the level of all services provided, compared to the same period of last year. The number of fixed-line subscribers and fixed-broadband internet customers increased by 5% and 8%, respectively, while the number of mobile subscribers increased to 12.6 million, allowing the company to achieve a growth rate of 7% compared to the same period of last year.
According to Telecom Egypt’s business results, capital expenditures for in-service assets amounted to EGP 4.5bn, an increase of 55% compared to the same period last year. That represents 16% of total revenues. Cash capital expenditures amounted to EGP 11.2bn, after excluding the effect of licensing and frequency expenses, with a percentage of capital expenditures to sales up to 40%.
Net debt reached 1.4 times EBITDA on an annual basis, which is the same ratio achieved in fiscal year 2022, although the total debt ballooned by 43% in light of the revaluation of liabilities as a result of the exchange rate change.
Mohamed Nasr, Managing Director and CEO of Telecom Egypt, said that the company was able to attract a new segment of customers in all its services, which was reflected in the profits that achieved a growth of 67% compared to the same period last year.
He added that the TE continued to reap more profits through the amended shareholder agreement with Vodafone, as the company received EGP 2.1bn in dividends in July 2023.
Nasr expected an improvement in free cash flows during the third and fourth quarters of 2023 in light of the aforementioned distributions, supported by the continued strong performance and revenue collection of cable projects achieved during this quarter.
It should be noted that the Telecom Egypt, in addition to paying its deferred obligations to suppliers, is taking a strategic approach to secure its future obligations from capital expenditures through prepayment of some investment items in order to avoid any challenges that may arise in supply chains or any other economic challenges, which put some pressure on capital expenditures during the first half of 2023.
