Massive payout after '23 and impressive guidance for '24

MTEL reported a strong set of results on Thursday noon, as they reported higher-thanexpected revenues and net profit for Q4 and the full year of 2023. MTEL proposed a DPS
of HUF 44.7 and announced a SBB program of up to HUF 24bn. Adj. net profit is seen at
HUF 130bn in 2024, well ahead of consensus, suggesting a total shareholder
remuneration of HUF 91bn calculated at a 70% POR after 2024 earnings.
 Group revenues increased by 15.1% YoY in Q4/23 or 13.8% QoQ, driven by strong demand
for mobile data and fixed broadband services ont he back of inflation-based fee adjustments.
 EBITDA improved by 16.0% YoY, but a touch below estimates because of higher-thanexpected direct costs. Net income for the quarter totalled HUF 23.2bn vs. our estimate of
22.4bn and consensus estimate of 21.5bn, reflecting the improvement in the operational
performance. FCF amounted to HUF 86.8bn in 2023, up HUF 35.9bn vs. last year, driven by
reduced CAPEX level, which fell by 17% YoY to HUF 105.1bn (excl. spectrum licenses).
 More importantly, the BoD proposed a total shareholder remuneration of up to HUF
65.56bn, corresponding to approx. 70% of adjusted earnings for 2023. Accordingly,
MTEL will distribute HUF 44.7 a share as dividend, while they will buy back shares worth
up to HUF 24bn. The BoD also proposes the record date of the dividend payment to be
on 26 Apr, while the date of the SBB program is yet to be determined.
 MTEL gave a very impressive guidance for 2024, which is well ahead of the consensus
and our higher estimates as well. They see revenues to grow in the range of between 5-
10%, while they expect an EBITDAaL growth of 20-25% for 2024. Adjusted net income is
foreseen at c. HUF 130bn, corresponding to a growth of 39% YoY, and FCF guidance
points to c. HUF 120bn vs. HUF 86.8bn in 2023.