It’s noteworthy that $1.6 billion of this net debt is attributed to the HQ level. Our cash reserves remain healthy at $1.7 billion, with $1.3 billion of this liquidity being retained at the HQ level. Where does our debt profile stand now? Our debt profile has improved substantially. We have successfully restructured our debt to extend major maturities to 2025, providing the company with greater financial flexibility. By the end of the fourth quarter, VEON is $400 million in debt due in the upcoming 12 months. As of October 2023, the debt set to mature in 2025 totals $1.64 billion. It’s significant to note that additional debt repayments are poised to not only diminish VEON’s overall gross debt levels and upcoming maturities, but will also lower the absolute cost of debt servicing.
Furthermore, there is $810 million currently outstanding under the revolving credit facility, which provides us with the option to roll over the amount until the final due date in 2024 and 2025, thereby enhancing our liquidity, management and long-term financial strategy. Let me outline some of the changes to our cost of debt and average debt maturity. The cost of borrowing first quarter of 2022 has been impacted by three key factors. Emerging market frontier rates is the first one. Higher interest rates on floating dollars and Pakistani rupee debt. The second factor is early redemptions. The early redemption of VEON bonds maturing in December 2023 and June 2024 have also had an impact on borrowing cost, due to these bonds holding relatively lower coupons versus the average cost of debt and the acquisition of VEON Holdings bonds by PJSC VimpelCom.
Number three, higher proportion of OpCo debt. I should note that we now have a greater proportion of higher rate OpCo debt than lower rate dollar debt in our gross debt mix. This is the effect of increasing blended cost of debt. Our average debt maturity excluding the RCF stands at 2.9 years. Now I will hand over to Kaan.
Kaan Terzioglu: Thank you Joop. Let me look into 2024 outlook. A year ago when we provided our guidance for 2023, we have indicated that the 2023 was up for a year for 10% to 14% growth in top line and EBITDA. Over the years, over the months, we have increased our guidance and we actually increased the guidance in Q3 to 18% to 20% growth for revenues and EBITDA. We finished 2023 with 18% growth of top line and 20% growth in EBITDA. Looking to the trends of the first two months, we are cautiously optimistic that the momentum of growth continues. And we are setting a guidance for 2024 for 16% to 18% growth of top line and 18% to 20% growth in EBITDA. We expect our 12-month CapEx intensity to be in between 18% to 19%. We believe that as we execute our digital operator strategy and improve our 4G penetration in [all the] (ph) markets, this momentum will enable us to achieve these results.
Thank you very much. I will stop here and open for discussions and questions. Thank you.
A – Faisal Ghori: Our first question comes from Rahul Shah from [indiscernible]. In which markets are you seeing the scope for the biggest revenue uplift from the digital strategy?
Kaan Terzioglu: During my presentation, I have mentioned that the most advanced digital operator execution engine in our market is Kazakhstan. And we actually see here 73% 4G penetration, and we generate almost 60% of our revenues from customers who consume also our digital services. This is followed by actually a very strong performance from Pakistan, Uzbekistan and Bangladesh.
Faisal Ghori: Second question also from Rahul. Regarding asset disposals, do you have any visibility or scale location timeline? What are you facing the biggest challenges to upstreaming profits or asset sale proceeds?
Kaan Terzioglu: In all the markets that we operate in, we do have independent tower companies currently owned by us, and we are actually able to execute processes for transacting on either partially or fully on these tower companies. I do expect over the 18 months, these projects to deliver fruits. This year we have finished in 2023 with one-third of our towers in Bangladesh and that will probably be the earliest ones that we will come back to the market again. Now, disposal of assets is one thing that we create value from our balance sheet, but I also see our growing digital services as an attraction for international investors for actually taking strategic positions as well. Entertainment services like Tamasha and Toffee in Pakistan and Bangladesh, Fintech services like Simply in Kazakhstan or JazzCash in Pakistan are also examples of potential value creation for us.
Faisal Ghori: The next question is also from Rahul. Your guidance implies a slight uptick in CapEx intensity this year. Where will this extra investment be focused and why the shift in approach?
Kaan Terzioglu: Last year we actually were 1 percentage point below where we wanted to be and this was due to the basically import controls that Pakistan has put in place. So as that actually disappears, we do expect our normal path, which we started as you know about three years ago from 22% and now we are down to 19%, 18%, last year was actually a 1 percentage point less than what we wanted to do in terms of investments. This is actually where we should be.
Faisal Ghori: Okay, I’m going to switch to some of our kind of retail investors. Are there any plans to award shareholders with a dividend?
Kaan Terzioglu: At this stage, we believe it’s too early to come to that conclusion, and we will keep everybody posted on that.
Faisal Ghori: The next question is also from our retail platform. Are there any updates on the application that was submitted in Bangladesh for the digital banking license?
Kaan Terzioglu: We are still in the process of talking with the authorities in terms of the digital banking license and there has not been any news on that.
Faisal Ghori: Okay, The next questions come from Stella Cridge from Barclays. Can you talk about how discussions around refinancing options have been progressing? How are you thinking about addressing the 2025 bonds?
