Ukrtelecom's 2018 financial results: income is affected by theft of 3,000 kilometers of cable

Ukrtelecom announced its financial results for 2018. They can be described in one word:

stability. Total revenue for the year decreased by 2.3%, showing 6.449 billion hryvnia against 6.601 billion a year earlier. The company calls it a demonstration of stability. Fixed voice communication predictably shows the largest drop in revenues (2.8 billion hryvnia versus 3 billion in 2017), but the stakes were made on the growth of income from the Internet, and everything is fine there: income from Internet servants increased by 7.7%, and their share grew during the year by 13.3% and already accounts for almost 40% of the company's total revenues.

Now at Ukrtelecom 3.03 million active voice fixed-line subscribers, their number has decreased over the year, and, as they say in the company, most of the outages are associated with regular thefts of copper cable, which are massive: 3,000 kilometers of copper cable were stolen (about 20,000 cases), which is 7.6 km per day or 5.3 meters per minute. The average revenue from voice communications increased from 44.5 to 51 hryvnias, which is associated with a reduction in the time required to eliminate accidents (in the past year in several regions, as an experiment, subscribers were provided with fixed phones capable of switching to the Trimob mobile network during a communication break) The company has 1.2 million Internet subscribers, which give an average of 86.3 hryvnia of revenue per month (last year this figure was UAH 76.1). The number of IPTV users, which are already 90 thousand, is gradually increasing. In 2018, Ukrtelecom connected 198 settlements to fiber optic lines (44 of them were new settlements where there was no Internet before). In total, 2260 settlements of the country are connected to the Internet of Ukrtelecom.

"The inevitable organic decline in the decline in revenues from traditional voice communications should be offset by the growth in revenues from Internet services"
Yuri Kurmaz, Director of Ukrtelecom OJSC

The company notes that already 30% of newInternet connections are provided by new progressive technologies: FTTB, FTTH and VDSL. In just one year, 3100 kilometers of optical fiber were installed. Revenues in the corporate segment are also growing - about 400 projects were implemented during the year, their number has already exceeded 1000. Revenues in this segment reached 1.3 billion hryvnias (of which 520 million gave access to the Internet and data services). Capital investment in 2018 amounted to 604 million hryvnia. Ukrtelecom is also one of the largest taxpayers among telecom companies in the country - in 2018, the company transferred about 2 billion hryvnia in taxes to budgets of all levels.

The main financial indicators of Ukrtelecom for 2018 in one table:

Key financial indicators of Ukrtelecom


2017
2018

Income, million UAH
6,600
6,449

Net profit, UAH million
864
474

EBITDA, UAH million
1,851
1,618

EBITDA, margin,%
27.8
25.1

CAPEX, million UAH
947
604

Taxes, million UAH
1,795
2,002

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