VimpelCom is “confident” of a favourable EC decision on the proposed merger of its Wind Italy business with Hutchison’s 3 Italia next month, the company said while reporting its Q2 results.
CEO Jean Yves Charlier said in its Q2 results statement that “as of today” (4 August), no statement of objections had been received from the European Commission, with a decision expected on the 8 September.
The quarter saw the company and 3 Italia owner CK Hutchison submit a proposal to EU regulators that will help France’s Iliad enter the Italian market, addressing competition concerns over their own merger.
The move is said to have won over the EC, and Charlier said the company remains confident about securing approval.
For Q2, VimpelCom said total revenue dropped 16 per cent year on year to $2.2 billion from $2.6 billion, impacted by adverse currency movements, although it noted that this effect is moderating.
Profit for the period grew 29 per cent to reach $138 million, from $108 million, boosted by a reclassification of its Italian business which led to different depreciation and ammortisation treatment.
EBITDA was down 26 per cent to $795 million, due to “currency headwinds and exceptional items” related to its “group-wide performance transformation programme”.
Total mobile customers increased by 2 million to hit 194 million by the end of the period, down to strong growth in Pakistan.
On an organic basic, revenue was more stable, growing 0.1 per cent which the company again put down to strong performance in Pakistan, as well as the Ukraine, growing 14 per cent and 11 per cent respectively.
But there were struggles in Algeria, where revenue dropped 15 per cent, while its largest market Russia also saw struggles, dropping 2 per cent.
Service revenue (mobile and fixed) dropped 0.7 per cent organically, generating $2.1 billion, compared with $2.5 billion in the quarter year prior, but the company did see an uplift in mobile data revenue, growing 26 per cent to hit $334 million.
Charlier said this reflects the company’s “strategic focus to transform our business from traditional voice and messaging to data and digital services”.