Türk Telekomünikasyon (TTKOM) Q1 2024 earnings summary

Executive summary

• Revenue reached TL 28.0 billion in Q1 2024, up 6% year-over-year, driven by mobile and fixed internet growth.

• Adjusted EBITDA rose 23% to TL 10.3 billion, with margin expanding by 510 basis points to 36.6%.

• Net income for Q1 2024 was TL 1.04 billion, down 16% year-over-year, impacted by higher tax and FX losses.

• Subscriber base totaled 52.8 million, with fixed broadband net additions offsetting mobile and fixed voice losses.

• Achieved a milestone by issuing Turkey's first international sustainability bond under a new sustainable finance framework.

Financial highlights

• Excluding inflation accounting, revenue growth was 9% year-over-year.

• Free cash flow improved to TL 1.9 billion from negative TL 3.6 billion a year ago.

• CAPEX was TL 4.6 billion, down 22% year-over-year, with a CAPEX/sales ratio of 16.2%.

• Mobile revenue surged 20-21% year-over-year, with postpaid share at 72% and blended ARPU up 15.7-16%.

• Fixed broadband revenue grew 2-7% year-over-year, with subscriber and ARPU growth.

Outlook and guidance

• Confident in full-year guidance, expecting continued ARPU growth and strong cash flow generation.

• Wholesale price hikes approved by regulator to take effect in July, with retail price adjustments planned for June.

• Fixed internet ARPU expected to benefit from price adjustments, with improved customer absorption in summer and back-to-school periods.

• Insurance income from earthquake claims to positively impact EBITDA and cash flow in upcoming quarters.

• Management expects to recover deferred tax assets related to investment incentives within two years.