Release Date: April 22, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Vodafone Qatar QSC (DSMD:VFQS, Financial) reported a 6.1% year-on-year increase in total revenue, reaching 855 million riyals.
- Net profit increased by 8.1% to 162 million riyals, reflecting strong financial performance.
- The company successfully launched a new loyalty program, enhancing customer experience and engagement.
- Vodafone Qatar QSC (DSMD:VFQS) has diversified its revenue streams, reducing reliance on mobile services and expanding into fixed managed services and ICT.
- Operational efficiency has improved, with a record low operational expense intensity of 21.9% this quarter.
Negative Points
- The company faces a highly competitive pricing environment, particularly in the enterprise segment.
- Quarter-over-quarter ARPU (Average Revenue Per User) has declined, attributed to seasonality and fewer days in the quarter.
- There was a one-off depreciation charge related to asset migration, impacting financials.
- Despite revenue growth, the company must maintain stable expenses to ensure continued profitability.
- Equipment sales growth includes non-recurring revenue, which may not be sustainable long-term.
Q & A Highlights
Q: What are the key drivers for Vodafone Qatar's strong performance, particularly in the consumer and enterprise segments?
A: The key growth drivers include gaining market share within the traditional telecom sphere and diversifying revenue into ICT and managed services. Both consumer and enterprise segments are contributing to top-line expansion. In the consumer segment, Vodafone Qatar continues to gain market share in both pre-paid and postpaid segments, with increases in both ARPU and customer base. The enterprise segment growth is driven by traditional telecom services and ICT managed services. - Masru Ranjum, CFO
Q: Why have ARPUs declined quarter over quarter despite year-over-year growth?
A: The decline in ARPUs quarter over quarter is mainly due to seasonality and the number of days in the quarter. Q4 typically sees higher ARPUs due to events and an influx of tourists, which did not occur in Q1. - Masru Ranjum, CFO
Q: Is the higher net profit growth compared to revenue growth driven by margins or other factors?
A: The higher net profit growth is primarily due to the larger absolute increase in revenue. There are no unusual one-offs affecting the profit, except for a one-off depreciation charge related to FDD to TDD migration. - Masru Ranjum, CFO
Q: What is driving the growth in equipment sales this quarter?
A: The growth in equipment sales is driven by contracts in the ICT and managed services domain, which sometimes include only equipment sales. There is a solid pipeline of customers, and some of the revenue is non-recurring in nature. - Masru Ranjum, CFO
Q: How do you see operational expenses evolving in 2025, and is there scope for further operational efficiency?
A: Vodafone Qatar has been successful in its cost optimization program, keeping operational expenses largely flat despite business growth. The focus is on reducing OpEx intensity, and the company aims to continue rationalizing operational expenses going forward. - Masru Ranjum, CFO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
