VEON Ltd. 2025 Annual Report (Form 20-F) Summary
Business Context and Reporting Period
This summary covers VEON Ltd.'s Annual Report on Form 20-F for the fiscal year ended December 31, 2025. VEON is a leading digital operator headquartered in Dubai (DIFC), operating in five frontier markets: Pakistan, Ukraine, Kazakhstan, Bangladesh, and Uzbekistan. The company provides telecommunications, infrastructure, and digital services (financial services, entertainment, healthcare) under brands including Jazz, Kyivstar, Banglalink, and Beeline. The reporting period reflects significant strategic shifts, including the demerger and Nasdaq listing of Kyivstar Group Ltd., the sale of Kyrgyzstan operations, and the execution of an "asset-light" strategy involving tower sales.
Key Financial Metrics (Year Ended Dec 31, 2025)
| Metric | 2025 (USD Millions) | 2024 (USD Millions) | Change |
|---|---|---|---|
| Total Revenue | 4,399 | 4,004 | +9.9% |
| Operating Profit | 1,439 | 1,110 | +29.6% |
| Profit for the Period | 591 | 487 | +21.4% |
| Adjusted EBITDA | 2,010 | 1,691 | +18.9% |
| Adjusted EBITDA Margin | 45.7% | 42.2% | +3.5 pp |
| Net Debt | ~$1.4 billion* | ~$1.7 billion* | Decrease |
| Cash & Equivalents | 1,732 | 1,688 | +2.6% |
| Capital Expenditures (excl. licenses/ROU) | 926 | 818 | +13.2% |
*Net Debt calculated as Total Debt ($3.143B) less Cash ($1.732B). Debt includes $1.8B in lease liabilities.
Material Changes vs. Prior Period
- Revenue Growth: Driven by increased data usage, repricing, and higher digital service consumption (including the Uklon acquisition) in Pakistan, Ukraine, Kazakhstan, and Uzbekistan. Growth was partially offset by market contraction in Bangladesh and currency depreciation.
- Operating Profit Surge: The 29.6% increase was primarily due to higher revenues and a $400 million gain on the disposal of subsidiaries (specifically the sale of the Pakistan tower portfolio to Engro Corp), partially offset by a $162 million listing expense related to the Kyivstar SPAC transaction.
- Segment Performance:
- Pakistan: Revenue +17.5% (US$); Adjusted EBITDA +21.9% (US$). Strong growth in digital financial services (JazzCash) and data.
- Ukraine: Revenue +25.8% (US$); Adjusted EBITDA +25.2% (US$). Growth driven by roaming, data, and digital services, despite ongoing war impacts and infrastructure damage.
- Bangladesh: Revenue -11.5% (US$) due to market contraction and currency depreciation, though Adjusted EBITDA improved +24.9% (US$) due to one-off regulatory fee releases.
- Kazakhstan: Revenue -4.4% (US$) due to currency depreciation, though local currency revenue grew 6.5%.
- Foreign Exchange: A net foreign exchange loss of $41 million was recorded, compared to a gain of $9 million in 2024, driven by the depreciation of the Bangladeshi taka, Pakistani rupee, and Ukrainian hryvnia.
Guidance, Outlook, and Risks
Outlook & Strategy: VEON continues to pursue its "Digital Operator 1440" and "Asset-Light" strategies. The company aims to grow digital revenue (which was 17.3% of total revenue in 2025) and monetize infrastructure through tower sales and lease-back arrangements. Management anticipates continued investment in 4G/5G networks and AI integration (AI1440 strategy).
Dividend Policy: No dividends were paid in 2025, 2024, or 2023. The company does not anticipate distributing dividends in the near future, prioritizing growth and debt reduction.
Key Risks & Contingencies:
- War in Ukraine: Continued conflict poses risks to infrastructure, supply chains, and the ability to upstream cash. Approximately 5% of the Ukrainian network remains non-functional in occupied territories. Sanctions on beneficial owners of the largest shareholder (LetterOne) create reputational and banking challenges.
- Geopolitical Instability: Political unrest in Bangladesh and Pakistan, as well as regional conflicts (e.g., Middle East), impact operations and consumer spending.
- Currency Volatility: Significant exposure to local currency depreciation against the USD, which impacts reported revenue and debt servicing costs.
- Regulatory & Tax: Ongoing tax disputes in Pakistan (Deodar tax case) and Bangladesh (BTRC claims) create contingent liabilities. A $170 million provision was recognized in 2025 related to a settlement with the Dhabi Group.
- Cybersecurity: The company faces ongoing cyber threats, including state-sponsored attacks, particularly in Ukraine.
Investor Verification Checklist
- Kyivstar Listing Impact: Verify the financial impact of the Kyivstar Group Ltd. listing (ticker: KYIV) and the subsequent secondary offering in February 2026, which reduced VEON's ownership to 83.6%.
- Debt Maturity Profile: Review the maturity schedule of the $3.1 billion external debt, noting that 16% matures within one year, and assess refinancing risks in a high-interest rate environment.
- Ukraine Cash Upstreaming: Confirm the extent of cash restrictions in Ukraine due to martial law and the impact on VEON's ability to service group-level debt.
- Asset-Light Execution: Monitor the progress of tower sales and lease-back agreements (e.g., Engro in Pakistan, Summit in Bangladesh) and the associated long-term lease liabilities.
- Regulatory Provisions: Track the resolution of the Deodar tax case in Pakistan and the BTRC interest claim in Bangladesh, which represent significant contingent liabilities.
- Digital Revenue Mix: Assess the sustainability of digital revenue growth (17.3% of total) and the performance of key digital verticals like JazzCash and Uklon.