VEON Ltd. 2024 Annual Report (Form 20-F) Summary
Business Context and Reporting Period
Company: VEON Ltd.
Reporting Period: Fiscal year ended December 31, 2024.
Business Overview: VEON is a leading digital operator in frontier markets, providing connectivity and digital services across Pakistan, Ukraine, Kazakhstan, Uzbekistan, and Bangladesh. The company operates under brands including Jazz, Kyivstar, Banglalink, and Beeline. VEON is incorporated in Bermuda, with its headquarters relocated to Dubai (DIFC) in December 2024.
Accounting Basis: International Financial Reporting Standards (IFRS).
Key Financial Metrics (Year Ended Dec 31, 2024)
| Metric | 2024 (USD Millions) | 2023 (USD Millions) | Change |
|---|---|---|---|
| Total Operating Revenue | 4,004 | 3,698 | +8.3% |
| Operating Profit | 1,110 | 929 | +19.5% |
| Profit for the Period | 487 | (2,450) | Turnaround |
| Adjusted EBITDA | 1,691 | 1,612 | +4.9% |
| Net Debt | ~1.66 billion | ~1.81 billion | Decrease |
| Cash & Cash Equivalents | 1,688 | 1,902 | -11.3% |
| Capital Expenditures (excl. licenses/ROU) | 818 | 649 | +26.0% |
Note: 2023 results included a significant loss from discontinued operations (Russia sale) of $2,830 million. 2024 results reflect continuing operations only.
Material Changes vs. Prior Period
- Revenue Growth: Consolidated revenue increased 8.3% to $4.004 billion, driven by local currency growth in Pakistan, Ukraine, Kazakhstan, and Uzbekistan, partially offset by currency depreciation and lower data usage in Bangladesh.
- Profitability: Profit for the period turned positive ($487 million) compared to a loss of $2.45 billion in 2023. The 2023 loss was primarily due to the disposal of Russian operations. Operating profit increased 19.5% due to higher revenues and a $145 million gain on the disposal of TNS+ in Kazakhstan.
- Segment Performance:
- Pakistan: Revenue +23.5% (USD); Adjusted EBITDA +16.3%.
- Ukraine: Revenue flat in USD (+0.7%) but +11.0% in local currency; Adjusted EBITDA -4.3% (USD) due to currency effects and higher energy/security costs.
- Bangladesh: Revenue -8.8% (USD) and -2.8% (local currency) due to political unrest and network shutdowns in mid-2024.
- Debt Reduction: Repaid and cancelled the $1.055 billion Revolving Credit Facility (RCF) in March 2024. Total external debt principal decreased to $3.348 billion.
Guidance, Outlook, Risks, and Unusual Items
- Going Concern Emphasis: Independent auditors (UHY LLP) included an emphasis of matter paragraph regarding the Company's ability to continue as a going concern due to the ongoing war in Ukraine, potential sanctions, and liquidity constraints. Management believes it has sufficient liquidity for the next 12 months but acknowledges material uncertainties.
- War in Ukraine: Operations in Ukraine (23% of 2024 revenue) face infrastructure damage, increased security costs ($61.8 million in 2024), and currency volatility. Approximately 6% of the network remains non-functional in occupied territories. Corporate rights in Ukrainian subsidiaries were frozen in late 2023 but largely unfrozen by a court ruling in November 2024.
- Political Unrest in Bangladesh: Civil unrest in July-August 2024 led to network shutdowns and a decline in subscriber base and revenue.
- Strategic Transactions:
- Kyivstar Listing: Signed a business combination agreement (March 2025) to list Kyivstar on Nasdaq via a SPAC (Cohen Circle), expected in Q3 2025.
- Asset-Light Strategy: Completed sale of TNS+ (Kazakhstan) and Bangladesh tower assets; entered into a strategic partnership with Engro Corp for Pakistan infrastructure.
- Share Buyback: Initiated a $100 million buyback program; completed the first $30 million phase by January 2025.
- Unusual Items: A December 2023 cyber-attack on Kyivstar resulted in a $46 million revenue impact in H1 2024 due to customer retention offers. A $66 million gain was recognized on the disposal of TNS+ in Kazakhstan.
Key Facts for Investor Verification
- Liquidity Position: Verify the sufficiency of the $481 million HQ-level cash and $1.2 billion operating company cash to service $3.3 billion in debt, considering restricted cash in Ukraine ($437 million) and potential inability to upstream dividends.
- Ukraine Exposure: Monitor the status of the Kyivstar Nasdaq listing and the potential for further sanctions or nationalization risks given the association with LetterOne (45.5% shareholder).
- Bangladesh Recovery: Assess the trajectory of revenue recovery in Bangladesh following the political transition and network shutdowns in 2024.
- Debt Maturities: Review the maturity profile of the $3.3 billion debt, noting that 38% matures within one year, and the success of the recent $210 million term loan syndication (March 2025).
- Impairment Risks: Evaluate the sensitivity of the Bangladesh and Ukraine Cash Generating Units (CGUs) to further geopolitical or economic deterioration, which could trigger impairment charges.