ASTANA, Kazakhstan, December 1. The international rating agency S&P Global Ratings has confirmed Kazakhtelecom JSC's credit rating at BB+ with a 'Stable' outlook, Trend reports.
The company's moderate leverage and continued organic revenue growth contribute to the company's stable future.
S&P Global Ratings anticipates that, with solid operating cash production and high cash balances, Kazakhtelecom's external financing needs for large expenditures in 5G network expansion in 2023-2025 will be minimal. As a result, the Kazakhtelecom Group of Companies' debt burden will be kept at an appropriate level for the present grade.
According to S&P, Kazakhtelecom's dominance in the fixed broadband Internet access market (64 percent market share) provides the company with a strong competitive advantage over other operators.
According to Kazakhtelecom's chief financial director, Lyudmila Atamuratova, the company feels that the financial results acquired for the first nine months of 2023 confirm the efficiency of the chosen approach.
"It is important for us that the analysts of the rating agency S&P Global Ratings share the same opinion, especially taking into account their independence and international expertise," she said.
S&P Global Ratings expects that in 2023-2025, the consolidated EBITDA margin will decrease to 40 percent due to the significant indexation of base wages and high inflation rates.
In their opinion, this level of profitability is average among comparable companies operating in the communications industry.
The income of the Kazakhtelecom group of enterprises climbed by 30 billion tenge (about $65 million) and surpassed 504 billion tenge, or approximately $1.1 billion, from January to September 2023 (475 billion tenge, or approximately $1.03 billion, for the first nine months of 2022).
At the same time, the company's EBITDA (earnings before interest, taxes, depreciation, amortization, and management) increased by 3.2 percent, with a profit margin of 46.5 percent compared to revenue.
Furthermore, net profit climbed to 89.3 billion tenge, or approximately $194.2 million (88.7 billion tenge, or approximately $192.8 million for the first nine months of 2022).