4iG (4IG) H1 2024 earnings summary

Executive summary

• Expanded Hungarian footprint with acquisitions of PR-Telecom and Direct One, adding over 400,000 new customers and significant fixed infrastructure.

• Entered strategic partnerships with RTL Hungary, Huawei, and Telecom Egypt for exclusive content, technology collaboration, and a USD 600 million fiber infrastructure JV.

• Continued transformation program with structural separation of telecom subsidiaries and integration of IT, space, and technology activities, targeting a HUF 400 billion enterprise value increase by 2025.

• Expansion into space technology with the creation of 4iG Space and Defence Plc and acquisition of a 45% stake in REMRED Zrt.

• Exploring entry into North Macedonia's telecom market, aligning with regional expansion strategy.

Financial highlights

• H1 2024 net revenues rose 23% year-over-year to HUF 328.4 billion; Q2 2024 net revenues up 13% to HUF 170.7 billion.

• H1 2024 normalized EBITDA increased 34% to HUF 110.5 billion; Q2 2024 normalized EBITDA up 29% to HUF 56.4 billion.

• Q2 2024 profit after tax adjusted for PPA fell 86% year-over-year to HUF 622 million; H1 2024 adjusted profit after tax was HUF 6.5 billion, but reported net loss after tax was HUF -23.3 billion due to financial expenses and non-cash charges.

• Financial income declined sharply due to unfavorable FX rates; H1 2024 saw a HUF 9.9 billion unrealized FX loss on Vodafone acquisition loan.

• Depreciation and amortization increased due to Vodafone acquisition and related purchase price allocation impacts.

Outlook and guidance

• Extraordinary general meeting scheduled for September 30, 2024, to decide on the spin-off of the IT/SI business, aiming to enhance efficiency and transparency.

• Transformation program expected to complete in 2025, targeting significant efficiency gains and improved sales performance.

• Ongoing investments in space, defense, and fiber infrastructure to drive future growth.

• Continued focus on leveraging partnerships and technology leadership in 5.5G and cloud services.

• Continued focus on regional expansion and integration of recent acquisitions.