Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2018shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | VEON Ltd. |
Entity Central Index Key | 0001468091 |
Document Type | 20-F |
Document Period End Date | Dec. 31, 2018 |
Entity Emerging Growth Company | false |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding (in shares) | 1,756,731,135 |
Document Fiscal Year Focus | 2018 |
Document Fiscal Period Focus | FY |
Entity Shell Company | false |
CONSOLIDATED INCOME STATEMENT
CONSOLIDATED INCOME STATEMENT - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | [1] | Dec. 31, 2016 | [1] | |
Profit or loss [abstract] | |||||
Service revenue | $ 8,526 | $ 9,105 | $ 8,553 | ||
Sale of equipment and accessories | 427 | 244 | 184 | ||
Other revenue | 133 | 125 | 148 | ||
Total operating revenue | 9,086 | 9,474 | 8,885 | ||
Service costs | (1,701) | (1,879) | (1,769) | ||
Cost of equipment and accessories | (415) | (260) | (216) | ||
Selling, general and administrative expenses | (3,697) | (3,748) | (3,668) | ||
Depreciation | (1,339) | (1,491) | (1,439) | ||
Amortization | (495) | (537) | (497) | ||
Impairment (loss) / reversal | (858) | (66) | (192) | ||
Gain / (loss) on disposal of non-current assets | (57) | (26) | (20) | ||
Gain / (loss) on disposal of subsidiaries | 30 | 0 | 0 | ||
Total operating expenses | (8,532) | (8,007) | (7,801) | ||
Operating profit | 554 | 1,467 | 1,084 | ||
Finance costs | (816) | (935) | (830) | ||
Finance income | 67 | 95 | 69 | ||
Other non-operating gain / (loss), net | (68) | (97) | (82) | ||
Share of profit / (loss) of joint ventures and associates | 0 | (22) | (11) | ||
Impairment of joint ventures and associates | 0 | (110) | (99) | ||
Net foreign exchange gain / (loss) | 15 | (70) | [2] | 157 | [2] |
Profit / (loss) before tax from continuing operations | (248) | 328 | [2] | 288 | [2] |
Income tax expense | (369) | (472) | (635) | ||
Profit / (loss) for the period from continuing operations | (617) | (144) | (347) | ||
Profit / (loss) after tax from discontinued operations | (300) | (390) | 979 | ||
Gain / (loss) on disposal of discontinued operations | 1,279 | 0 | 1,788 | ||
Profit for the period from discontinued operations | 979 | (390) | 2,767 | ||
Profit / (loss) for the period | 362 | (534) | [3],[4] | 2,420 | [3] |
The owners of the parent (continuing operations) | (397) | (115) | (439) | ||
The owners of the parent (discontinued operations) | 979 | (390) | 2,767 | ||
Non-controlling interest | $ (220) | $ (29) | $ 92 | ||
Basic and diluted gain / (loss) per share attributable to ordinary equity holders of the parent: | |||||
From continuing operations (in dollars per share) | $ (0.23) | $ (0.07) | $ (0.25) | ||
From discontinued operations (in dollars per share) | 0.56 | (0.22) | 1.58 | ||
Total (in dollars per share) | $ 0.33 | $ (0.29) | $ 1.33 | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[2] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[3] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[4] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | [2] | Dec. 31, 2016 | [2] | |
Statement of comprehensive income [abstract] | |||||
Profit / (loss) for the period | $ 362 | $ (534) | [1],[3] | $ 2,420 | [1] |
Items that may be reclassified to profit or loss | |||||
Share of other comprehensive loss of joint ventures | (18) | (12) | 0 | ||
Foreign currency translation | (819) | (637) | 85 | ||
Other | (2) | (7) | 13 | ||
Items reclassified to profit or loss | |||||
Accumulated share of other comprehensive income / (loss) of Italy Joint Venture | 31 | 0 | 0 | ||
Accumulated foreign currency translation reserve | (79) | 0 | (259) | ||
Accumulated cash flow hedge reserve | 0 | 0 | 53 | ||
Other comprehensive income / (loss) for the period, net of tax | (887) | (656) | (108) | ||
Total comprehensive income / (loss) | (525) | (1,190) | 2,312 | ||
Attributable to: | |||||
The owners of the parent | (138) | (1,081) | 2,233 | ||
Non-controlling interests | (387) | (109) | (79) | ||
Total comprehensive income / (loss) | $ (525) | $ (1,190) | $ 2,312 | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[2] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[3] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
CONSOLIDATED STATEMENT OF FINAN
CONSOLIDATED STATEMENT OF FINANCIAL POSITION - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | [1] |
Non-current assets | |||
Property and equipment | $ 4,932 | $ 6,237 | |
Intangible assets | 1,854 | 2,168 | |
Goodwill | 3,816 | 4,618 | |
Investments in joint ventures and associates | 0 | 1,921 | |
Deferred tax assets | 197 | 336 | |
Other assets | 193 | 263 | |
Total non-current assets | 10,992 | 15,543 | |
Current assets | |||
Inventories | 141 | 72 | |
Trade and other receivables, gross | 577 | 755 | |
Other financial assets | 88 | 1,130 | |
Other assets | 479 | 648 | |
Cash and cash equivalents | 1,808 | 1,314 | |
Total current assets | 3,093 | 3,919 | |
Assets classified as held for sale | 17 | 22 | |
Total assets | 14,102 | 19,484 | |
Equity | |||
Equity attributable to equity owners of the parent | 3,670 | 4,331 | |
Non-controlling interests | (891) | (441) | |
Total equity | 2,779 | 3,890 | [2] |
Non-current liabilities | |||
Financial liabilities | 6,567 | 10,362 | |
Provisions | 110 | 123 | |
Deferred tax liabilities | 180 | 376 | |
Other liabilities | 53 | 83 | |
Total non-current liabilities | 6,910 | 10,944 | |
Current liabilities | |||
Trade and other payables | 1,432 | 1,544 | |
Other financial liabilities | 1,289 | 1,268 | |
Provisions | 398 | 422 | |
Other liabilities | 1,290 | 1,401 | |
Total current liabilities | 4,409 | 4,635 | |
Liabilities associated with assets held for sale | 4 | 15 | |
Total equity and liabilities | $ 14,102 | $ 19,484 | |
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||
[2] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY - USD ($) $ in Millions | Total | Issued capital | Capital Surplus | Other capital reserves | Accumulated deficit | Foreign currency translation | Total | Non-controlling interests | ||
Number of shares outstanding at beginning of period (in shares) at Dec. 31, 2015 | 1,749,004,648 | |||||||||
Equity at beginning of period at Dec. 31, 2015 | $ 3,894 | $ 2 | $ 12,753 | $ 667 | $ (2,706) | $ (6,951) | $ 3,765 | $ 129 | ||
Profit / (loss) for the period | 2,420 | [1],[2] | 2,328 | 2,328 | 92 | |||||
Other comprehensive income / (loss) | (108) | [2] | 63 | (158) | (95) | (13) | ||||
Total comprehensive income / (loss) | 2,312 | [2] | 63 | 2,328 | (158) | 2,233 | 79 | |||
Dividends declared | (167) | (61) | (61) | (106) | ||||||
Changes in ownership interest in a subsidiary that do not result in a loss of control | 4 | 23 | 23 | (19) | ||||||
Number of shares outstanding at end of period (in shares) at Dec. 31, 2016 | 1,749,004,648 | |||||||||
Equity at end of period at Dec. 31, 2016 | 6,043 | $ 2 | 12,753 | 753 | (439) | (7,109) | 5,960 | 83 | ||
Profit / (loss) for the period | [3] | (534) | [1],[2] | (505) | (505) | (29) | ||||
Other comprehensive income / (loss) | (656) | [2] | (18) | (558) | (576) | (80) | ||||
Total comprehensive income / (loss) | (1,190) | [2] | (18) | (505) | (558) | (1,081) | (109) | |||
Dividends declared | (704) | (536) | (536) | (168) | ||||||
Share-based payment transactions | 122,756 | |||||||||
Changes in ownership interest in a subsidiary that do not result in a loss of control | (259) | (12) | (12) | (247) | ||||||
Reallocation to legal reserve in Algeria | 6 | (6) | ||||||||
Number of shares outstanding at end of period (in shares) at Dec. 31, 2017 | [3] | 1,749,127,404 | ||||||||
Equity at end of period at Dec. 31, 2017 | [3] | 3,890 | [4] | $ 2 | 12,753 | 729 | (1,486) | (7,667) | 4,331 | (441) |
Profit / (loss) for the period | 362 | 582 | 582 | (220) | ||||||
Other comprehensive income / (loss) | (887) | 11 | 5 | (736) | (720) | (167) | ||||
Total comprehensive income / (loss) | (525) | 11 | 587 | (736) | (138) | (387) | ||||
Dividends declared | (602) | (509) | (509) | (93) | ||||||
Other | (41) | 3 | (50) | (13) | (60) | 19 | ||||
Number of shares outstanding at end of period (in shares) at Dec. 31, 2018 | 1,749,127,404 | |||||||||
Equity at end of period at Dec. 31, 2018 | $ 2,779 | $ 2 | $ 12,753 | $ 743 | $ (1,412) | $ (8,416) | $ 3,670 | $ (891) | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | |||||||||
[2] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | |||||||||
[3] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | |||||||||
[4] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||||
Operating activities | ||||||
Profit / (loss) before tax from continuing operations | $ (248) | $ 328 | [1],[2] | $ 288 | [1],[2] | |
Non-cash adjustments to reconcile profit before tax to net cash flows: | ||||||
Depreciation, amortization and impairment loss / (reversal) | 2,692 | 2,094 | [2] | 2,128 | [2] | |
(Gain) / loss on disposal of non-current assets | 57 | 26 | [2] | 20 | [2] | |
(Gain) / loss on disposal of subsidiaries | (30) | 0 | [2] | 0 | [2] | |
Finance income | (67) | (95) | [2] | (69) | [2] | |
Finance costs | 816 | 935 | [2] | 830 | [2] | |
Other non-operating (gain) / loss, net | 68 | 97 | [2] | 82 | [2] | |
Share of loss and impairment of joint ventures and associates | 0 | 132 | [2] | 110 | [2] | |
Net foreign exchange (gain) / loss | (15) | 70 | [1],[2] | (157) | [1],[2] | |
Changes in trade and other receivables and prepayments | 96 | (168) | [2] | (129) | [2] | |
Changes in inventories | (88) | 54 | [2] | (13) | [2] | |
Changes in trade and other payables | 274 | 311 | [2] | (107) | [2] | |
Changes in provisions and pensions | 40 | (119) | [2] | (645) | [2] | |
Interest paid | (736) | (834) | [2] | (789) | [2] | |
Interest received | 60 | 89 | [2] | 63 | [2] | |
Income tax paid | (404) | (445) | [2] | (420) | [2] | |
Net cash flows from operating activities of discontinued operations | 0 | 0 | [2] | 683 | [2] | |
Net cash flows from operating activities | 2,515 | 2,475 | [2] | 1,875 | [2] | |
Investing activities | ||||||
Purchase of property and equipment and intangible assets | (1,948) | (2,037) | [2] | (1,651) | [2] | |
Proceeds from sale of property and equipment and intangible assets | 17 | 8 | [2] | 15 | [2] | |
Proceeds from sale of Italy Joint Venture | 2,830 | 0 | [2] | 0 | [2] | |
Receipts from / (payment on) deposits | 1,034 | (898) | [2] | 19 | [2] | |
Receipts from / (investment in) financial assets | 62 | (101) | [2] | (87) | [2] | |
Acquisition of subsidiaries, net of cash acquired | 0 | 0 | [2] | 7 | [2] | |
Proceeds from sale of shares in subsidiaries, net of cash disposed | 2 | 12 | [2] | (325) | [2] | |
Net cash flows from investing activities of discontinued operations | 0 | 0 | [2] | (649) | [2] | |
Net cash flows from / (used in) investing activities | 1,997 | (3,016) | [2] | (2,671) | [2] | |
Financing activities | ||||||
Acquisition of non-controlling interest | 0 | (259) | [2] | (5) | [2] | |
Proceeds from borrowings, net of fees paid | [3] | 807 | 6,193 | [2] | 1,882 | [2] |
Repayment of borrowings | (4,122) | (5,948) | [2] | (1,816) | [2] | |
Dividends paid to owners of the parent | (508) | (518) | [2] | (61) | [2] | |
Dividends paid to non-controlling interests | (93) | (201) | [2] | (106) | [2] | |
Net cash flows from financing activities of discontinued operations | 0 | 0 | [2] | (20) | [2] | |
Net cash flows from / (used in) financing activities | (3,916) | (733) | [2] | (126) | [2] | |
Net increase / (decrease) in cash and cash equivalents | 596 | (1,274) | [2] | (922) | [2] | |
Net foreign exchange difference | (119) | (354) | [2] | (64) | [2] | |
Classified as held for sale at the beginning of period | [2] | 0 | 0 | 314 | ||
Classified as held for sale at the end of the period | 0 | 0 | [2] | 0 | [2] | |
Cash and cash equivalents at beginning of period | [2] | 1,314 | 2,942 | 3,614 | ||
Cash and cash equivalents at end of period, net of overdraft | $ 1,791 | $ 1,314 | [2] | $ 2,942 | [2] | |
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | |||||
[2] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | |||||
[3] | ** Fees paid for borrowings were US$64 (2017: US$56, 2016: US$31) |
CONSOLIDATED STATEMENT OF CAS_2
CONSOLIDATED STATEMENT OF CASH FLOWS (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Statement of cash flows [abstract] | ||
Fees paid for borrowings | $ 56 | $ 31 |
GENERAL INFORMATION
GENERAL INFORMATION | 12 Months Ended |
Dec. 31, 2018 | |
GENERAL INFORMATION | |
GENERAL INFORMATION | General information VEON Ltd. ( “VEON” , the “Company” , and together with its consolidated subsidiaries, the “Group” or “we” ) was incorporated in Bermuda on June 5, 2009. The registered office of VEON is Victoria Place, 31 Victoria Street, Hamilton HM 10, Bermuda. VEON’s headquarters and the principal place of business are located at Claude Debussylaan 88, 1082 MD Amsterdam, the Netherlands. VEON’s ADSs are listed on the NASDAQ Global Select Market and VEON’s common shares are listed on Euronext Amsterdam, the regulated market of Euronext Amsterdam N.V. (“ Euronext Amsterdam ”). VEON earns revenues by providing voice and data telecommunication services through a range of mobile and fixed-line technologies. As of December 31, 2018 , the Company operated telecommunications services in Russia, Pakistan, Algeria, Bangladesh, Ukraine, Uzbekistan, Kazakhstan, Armenia, Georgia and Kyrgyzstan. During 2018 , VEON sold its operations in Tajikistan and Laos (see Note 15), as well as its 50% share in the Italy Joint Venture (see Note 10). The consolidated financial statements were authorized by the Board of Directors for issuance on March 14, 2019. The Company has the ability to amend and reissue the consolidated financial statements. The consolidated financial statements are presented in United States dollars ( “U.S. dollar” or “US$ ”). In these Notes, U.S. dollar amounts are presented in millions, except for share and per share (or American Depository Shares ( “ADS” )) amounts and as otherwise indicated. In these Notes to the consolidated financial statements, prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar assets (see Note 10). In addition, the Italy Joint Venture was classified as a discontinued operation during the year, resulting in the reclassification of share of profit / (loss) of the Italy Joint Venture to ‘Profit / (loss) after tax from discontinued operations’ for the current and comparative periods. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of operating segments [abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION Management analyzes the Company’s operating segments separately because of different economic environments and stages of development in different geographical areas, requiring different investment and marketing strategies. Management does not analyze assets or liabilities by reportable segments. Management evaluates the performance of the Company’s segments on a regular basis, primarily based on earnings before interest, tax, depreciation, amortization, impairment, gain / loss on disposals of non-current assets, other non-operating gains / losses and share of profit / loss of joint ventures and associates ( “Adjusted EBITDA” ) along with assessing the capital expenditures excluding certain costs such as those for telecommunication licenses ( “Capital expenditures” ). As of December 31, 2018 , the Italy Joint Venture is no longer a reportable segment, due to its classification as a discontinued operation in June 2018 and subsequent sale. Financial information by reportable segment for the periods ended December 31 is presented in the following tables. Inter-segment transactions between operating segments are made on terms which are comparable to transactions with third parties. External customers Inter-segment Total revenue Revenue 2018 2017 2016 2018 2017 2016 2018 2017 2016 Russia 4,632 4,698 4,059 22 31 38 4,654 4,729 4,097 Pakistan 1,481 1,525 1,293 13 — 2 1,494 1,525 1,295 Algeria 810 914 1,040 3 1 — 813 915 1,040 Bangladesh 521 574 621 — — — 521 574 621 Ukraine 663 600 566 25 22 20 688 622 586 Uzbekistan 314 513 662 1 — 1 315 513 663 HQ — — 10 — — — — — 10 Others 665 650 634 (64 ) (54 ) (61 ) 601 596 573 Total segments 9,086 9,474 8,885 — — — 9,086 9,474 8,885 Adjusted EBITDA Capital expenditures excluding licenses Other disclosures 2018 2017 2016 2018 2017* 2016* Russia 1,677 1,788 1,574 742 667 643 Pakistan 714 703 507 199 240 215 Algeria 363 426 547 107 132 165 Bangladesh 183 233 267 93 101 137 Ukraine 387 347 306 115 98 104 Uzbekistan 136 261 395 39 63 174 HQ (357 ) (325 ) (421 ) 11 31 24 Other 170 154 57 109 128 130 Total segments 3,273 3,587 3,232 1,415 1,460 1,592 * Prior period comparatives have been restated to exclude certain costs, such as cost to acquire telecommunication licenses. The following table provides the reconciliation of consolidated Adjusted EBITDA to consolidated income statement before tax for the years ended December 31 : 2018 2017* 2016* Total Segments Adjusted EBITDA 3,273 3,587 3,232 Depreciation (1,339 ) (1,491 ) (1,439 ) Amortization (495 ) (537 ) (497 ) Impairment (loss) / reversal (858 ) (66 ) (192 ) Gain / (loss) on disposal of non-current assets (57 ) (26 ) (20 ) Gain / (loss) on sale of subsidiaries 30 — — Finance costs (816 ) (935 ) (830 ) Finance income 67 95 69 Other non-operating gain / (loss), net (68 ) (97 ) (82 ) Share of loss of joint ventures and associates — (22 ) (11 ) Impairment of joint ventures and associates — (110 ) (99 ) Net foreign exchange gain / (loss) 15 (70 ) 157 Profit / (loss) before tax from continuing operations (248 ) 328 288 Geographical information of non-current assets The total of non-current assets (other than financial instruments, investments in subsidiaries and deferred tax assets, which are included in Other, along with consolidation eliminations), broken down by location of the assets, is shown in the following tables: 2018 2017 Russia 4,794 5,969 Pakistan 1,661 2,270 Algeria 1,890 2,151 Bangladesh 773 988 Ukraine 748 552 Uzbekistan 211 213 HQ 17 55 Other 898 3,345 Total segments 10,992 15,543 |
OPERATING REVENUE
OPERATING REVENUE | 12 Months Ended |
Dec. 31, 2018 | |
Revenue [abstract] | |
OPERATING REVENUE | OPERATING REVENUE VEON generates revenue from providing voice, data and other telecommunication services through a range of wireless, fixed and broadband Internet services, as well as selling equipment and accessories. Products and services may be sold separately or in bundled packages. The effect of initially applying IFRS 15 on the Group’s revenue from contracts with customers is described in Note 25. Due to the transition method chosen in applying IFRS 15, comparative information has not been restated to reflect the new requirements. Revenue from contracts with customers The following table provides a breakdown of revenue from contracts with customers by mobile and fixed line for the years ended December 31 : Mobile Fixed line Total revenue 2018 2017 2016 2018 2017 2016 2018 2017 2016 Russia 4,085 4,053 3,430 569 676 667 4,654 4,729 4,097 Pakistan 1,494 1,525 1,295 — — — 1,494 1,525 1,295 Algeria 813 915 1,040 — — — 813 915 1,040 Bangladesh 521 574 621 — — — 521 574 621 Ukraine 644 581 545 44 41 41 688 622 586 Uzbekistan 313 510 659 2 3 4 315 513 663 HQ — — — — — 10 — — 10 Others 496 530 499 105 66 74 601 596 573 Total segments 8,366 8,688 8,089 720 786 796 9,086 9,474 8,885 Assets and liabilities arising from contracts with customers The following table provides a breakdown of contract balances and capitalized customer acquisition costs. December 31, 2018 January 1, 2018 Contract balances Receivables (billed) 673 780 Contract assets (unbilled) 43 18 Contract liabilities (161 ) (157 ) Capitalized costs Customer acquisition costs 83 93 ACCOUNTING POLICIES The following accounting policies have been applied with effect from January 1, 2018, see Note 25 for further details. Revenue from contracts with customers Service revenue Service revenue includes revenue from airtime charges from contract and prepaid customers, monthly contract fees, interconnect revenue, roaming charges and charges for value added services (“VAS”). VAS includes short messages, multimedia messages, caller number identification, call waiting, data transmission, mobile internet, downloadable content, mobile finance services, machine-to-machine and other services. The content revenue relating to VAS is presented net of related costs when the Company acts as an agent of the content providers and gross when the Company acts as the primary obligor of the transaction. Revenue for services with a fixed term, including fixed-term tariff plans and monthly subscriptions, is generally recognized over time, on a straight-line basis. For pay-as-you-use plans, in which the customer is charged based on actual usage, revenue is recognized over time, on a usage basis. Some tariff plans allow customers to rollover unused services to the following period. For these tariff plans, revenue is generally recognized over time, on a usage basis. For contracts which include multiple service components (such as voice, text, data), revenue is allocated based on stand-alone selling price. The stand-alone selling price for these services is determined with reference the price charged per service under a pay-as-you-use plan to similar customers. Upfront fees, including activation or connection fees, are recognized on a straight-line basis over the contract term. For contracts with an indefinite term (generally prepaid contracts), revenue from upfront fees is recognized over the average customer life. Revenue from other operators, including interconnect and roaming charges, is recognized based on the price specified in the contract, net of any estimated retrospective volume discounts. Accumulated experience is used to estimate and provide for the discounts. All service revenue is recognized over time. Sale of equipment and accessories Equipment and accessories are usually sold to customers on a stand-alone basis or together with service bundles. Where sold together with service bundles, revenue is allocated pro-rata, based on the stand-alone selling price of the equipment and the service bundle. Revenue for mobile handsets and accessories is recognized when the equipment is sold to a network customer, or, if sold via an intermediary, when the intermediary has taken control of the device and the intermediary has no remaining right of return. Revenue for fixed-line equipment is not recognized until installation and testing of such equipment are completed and the equipment is accepted by the customer. All revenue from sale of equipment and accessories is recognized at a point in time. Contract balances Receivables and contracts assets mostly relate to amounts due from other operators and postpaid customers. Contract assets, often referred to as ‘Accrued receivables’ are transferred to receivables when the rights become unconditional, which usually occurs when the Group issues an invoice to the customer. Contract liabilities, often referred to as ‘Deferred revenue’, relate primarily to non-refundable cash received from prepaid customers for fixed-term tariff plans or pay-as-you-use tariff plans. Contract liabilities are presented as ‘Long-term deferred revenue’ and ‘Short-term deferred revenue’ in Note 7. All ‘Short-term deferred revenue’ amounts outstanding at the beginning of the year have been recognized as revenue during the year. Customer acquisition costs Certain incremental costs incurred in acquiring a contract with a customer ( “customer acquisition costs” ), are deferred in the consolidated statement of financial position, within 'Other assets' (see Note 7). Such costs generally relate to commissions paid to third-party dealers and are amortized on a straight-line basis over the average customer life, within ‘Selling, general and administrative expenses’. The Group applies the practical expedient available for customer acquisition costs for which the amortization would have been shorter than 12 months. Such costs relate primarily to commissions paid to third-party dealers upon top-up of prepaid credit by customers and sale of top-up cards. SOURCE OF ESTIMATION UNCERTAINTY Average customer life Management estimates the average customer life for revenue (such as upfront fees) from contracts with an indefinite term and for customer acquisition costs. The average customer life is calculated based on historical data, specifically churn rates for different customer segments (such as mobile and fixed line, prepaid and postpaid). |
OTHER NON-OPERATING LOSSES, NET
OTHER NON-OPERATING LOSSES, NET | 12 Months Ended |
Dec. 31, 2018 | |
OTHER NON-OPERATING LOSSES, NET | |
OTHER NON-OPERATING LOSSES, NET | OTHER NON-OPERATING LOSSES, NET Other non-operating (losses) / gains consisted of the following for the years ended December 31 : 2018 2017 2016 Loss from early debt redemption (30 ) (124 ) — Change of fair value of other derivatives (58 ) (13 ) (120 ) Impairment loss of other financial assets (2 ) (20 ) — Gains relating to past acquisitions and divestments 4 70 21 Other gains / (losses) 18 (10 ) 17 Other non-operating gain / (loss), net (68 ) (97 ) (82 ) Loss from early debt redemption in 2018 and 2017 relates to the settlement of the cash tender offer for certain outstanding debt securities, see Note 16 for further details. Included in ‘Gains relating to past acquisitions and divestments’ in 2017 is a net gain of US$ 45 pertaining to indemnification from a past business acquisition, and a gain of US$ 25 as a result of an increase in cash consideration receivable pertaining to the disposal of Italy operations in 2016 . |
TRADE AND OTHER RECEIVABLES
TRADE AND OTHER RECEIVABLES | 12 Months Ended |
Dec. 31, 2018 | |
Trade and other current receivables [abstract] | |
TRADE AND OTHER RECEIVABLES | TRADE AND OTHER RECEIVABLES Trade and other receivables consisted of the following items as of December 31: 2018 2017 2016 Trade receivables (gross)* 716 798 769 Allowance for doubtful debt (171 ) (169 ) (160 ) Trade receivables (net) 545 629 609 Other receivables 32 126 76 Total trade and other receivables 577 755 685 * Includes contract assets (unbilled receivables), see Note 3 for further details As of December 31, 2018 , an impairment of US $171 ( 2017 : US $169 , 2016: US $160 ) is recorded against trade receivables. See below the movements in the allowance for doubtful debt: 2018 2017 2016 Balance as of January 1 before IFRS 9 adjustment 169 160 182 Adjustment due to IFRS 9 (see Note 25) 14 — — Balance as of January 1 after IFRS 9 adjustment 183 160 182 Allowance for doubtful debts 47 36 73 Recoveries (17 ) (9 ) (5 ) Accounts receivable written off (18 ) (13 ) (44 ) Acquisitions and divestments of subsidiaries — — (48 ) Foreign currency translation adjustment (15 ) (4 ) 2 Other movements (9 ) (1 ) — Balance as of December 31 171 169 160 Set out below is the information about the Group’s trade receivables and contract assets using a provision matrix: Days past due December 31, 2018 Contract assets Current < 30 days Between 31 and 120 days > 120 days Total Expected loss rate, % 0.2 % 1.2 % 9.6 % 33.6 % 81.5 % Trade receivables, gross 44 389 61 44 178 716 Expected credit losses (1 ) (5 ) (6 ) (15 ) (144 ) (171 ) Trade receivables, net 43 384 55 29 34 545 Days past due January 1, 2018 Contract assets Current < 30 days Between 31 and 120 days > 120 days Total Expected loss rate, % 1.1 % 1.3 % 7.6 % 27.6 % 63.9 % Trade receivables, gross 18 371 92 87 230 798 Expected credit losses — (5 ) (7 ) (24 ) (147 ) (183 ) Trade receivables, net 18 366 85 63 83 615 ACCOUNTING POLICIES Trade and other receivables Trade and other receivables are measured at amortized cost and include invoiced amounts less appropriate allowances for estimated uncollectible amounts. Expected credit losses The following accounting policy has been applied with effect from January 1, 2018, see Note 25 for further details. The expected credit loss allowance (ECL) is recognized for all receivables measured at amortized cost or fair value through OCI with recycling at each reporting date. This means that an allowance for doubtful debt is recognized for all receivables even though there may not be objective evidence that the trade receivable has been impaired. VEON applies the Simplified approach (i.e. provision matrix) for calculating a lifetime ECL for its trade and other receivables, including unbilled receivables (contract assets). The provision matrix is based on the historical credit loss experience over the life of the trade receivables and is adjusted for forward-looking estimates. Forward looking estimates include macro-economic factors such as GDP (for receivables due from legal entities) and unemployment rates (for receivables due from individual customers). The provision matrix is reviewed on a quarterly basis. |
OTHER ASSETS AND LIABILITIES
OTHER ASSETS AND LIABILITIES | 12 Months Ended |
Dec. 31, 2018 | |
OTHER ASSETS AND LIABILITIES | |
OTHER ASSETS AND LIABILITIES | OTHER ASSETS AND LIABILITIES Other assets consisted of the following items as of December 31 : 2018 2017 Other non-current assets Customer acquisition costs (see Note 3) 83 — Non-current income tax advances (see Note 9) 32 28 Other financial assets 58 34 Advances to suppliers 11 17 Deferred costs related to connection fees 6 7 Indemnification assets 3 177 Total other non-current assets 193 263 Other current assets Advances to suppliers 151 162 Input value added tax 149 181 Current income tax assets (see Note 9) 112 230 Prepaid taxes 39 31 Deferred costs related to connection fees 8 12 Other assets 20 32 Total other current assets 479 648 Other liabilities consisted of the following items as of December 31 : 2018 2017 Other non-current liabilities Long-term deferred revenue (see Note 3) 10 12 Pensions and other post-employment benefits 29 54 Other liabilities 14 17 Total other non-current liabilities 53 83 Other current liabilities Short-term deferred revenue (see Note 3) 151 146 Customer advances 200 228 Customer deposits 192 189 Current income tax payables (see Note 9) 32 48 Other taxes payable 352 427 Other payments to authorities 86 91 Due to employees 198 173 Other liabilities 79 99 Total other current liabilities 1,290 1,401 |
PROVISIONS AND CONTINGENT LIABI
PROVISIONS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of other provisions [abstract] | |
PROVISIONS AND CONTINGENT LIABILITIES | PROVISIONS AND CONTINGENT LIABILITIES PROVISIONS The following table summarizes the movement in provisions for the years ended December 31 : Income tax provisions Non-income tax provisions Decommi-ssioning provision Legal provision Other provisions Total Cost As of January 1, 2017 244 96 98 157 27 622 Arising during the year 57 28 5 28 26 144 Reclassified to assets held for sale (1 ) — (4 ) — — (5 ) Utilized (4 ) (16 ) (1 ) (66 ) (13 ) (100 ) Unused amounts reversed (32 ) (4 ) (2 ) (68 ) (9 ) (115 ) Discount rate adjustment and imputed interest (change in estimate) — — 10 — — 10 Translation adjustments and other (6 ) (6 ) — (2 ) 3 (11 ) As of December 31, 2017 258 98 106 49 34 545 Current — — 106 16 1 123 Non-current 258 98 — 33 33 422 As of January 1, 2018 258 98 106 49 34 545 Arising during the year 11 11 4 5 43 74 Reclassified to assets held for sale (1 ) (1 ) (4 ) — — (6 ) Utilized (6 ) (11 ) (1 ) (2 ) (15 ) (35 ) Unused amounts reversed — — (2 ) (8 ) — (10 ) Transfer and reclassification (65 ) 65 — — — — Discount rate adjustment and imputed interest (change in estimate) — — 8 — — 8 Translation adjustments and other (33 ) (12 ) (18 ) — (5 ) (68 ) As of December 31, 2018 164 150 93 44 57 508 Non-current — — 93 17 — 110 Current 164 150 — 27 57 398 Significant legal proceedings are discussed below, or in Note 9 for tax-related proceedings. The timing of payments in respect of provisions is, with some exceptions, not contractually fixed and cannot be estimated with certainty. In addition, with respect to legal proceedings, given inherent uncertainties, there can be no guarantee that the ultimate outcome will be in line with VEON’s current expectations. See “Sources of estimation uncertainty” below for further details regarding assumptions and sources of uncertainty. The Group has recognized a provision for decommissioning obligations associated with future dismantling of its towers in various jurisdictions. Investigations by SEC / DOJ / OM During the first quarter of 2016 , the Company reached resolutions through agreements with the U.S. Securities and Exchange Commission ( “SEC” ), the U.S. Department of Justice ( “DOJ” ), and the Dutch Public Prosecution Service (Openbaar Ministerie) ( “OM” ) relating to the previously disclosed investigations under the U.S. Foreign Corrupt Practices Act (the “FCPA”) and relevant Dutch laws, pertaining to the Company’s business in Uzbekistan and prior dealings with Takilant Ltd. Pursuant to these agreements, the Company paid an aggregate amount of US $795 in fines and disgorgements to the SEC, the DOJ and the OM in the first quarter of 2016. On February 18, 2016, the United States District Court for the Southern District of New York (the “District Court” ) approved the agreements with the DOJ relating to charges that the Company and its subsidiary violated the anti-bribery, books-and-records and internal controls provisions of the FCPA. These agreements consisted of the deferred prosecution agreement (the “DPA” ), entered into by VEON and the DOJ and a guilty plea by Unitel, a subsidiary of VEON operating in Uzbekistan. Under the agreements with the DOJ, VEON agreed to pay a total criminal penalty of US $230 to the United States, including US $40 in forfeiture. In connection with the investigation by the OM, VEON and Silkway Holding BV, a wholly owned subsidiary of VEON, entered into a settlement agreement (the “Dutch Settlement Agreement” ) related to anti-bribery and false books-and-records provisions of Dutch law. Pursuant to the Dutch Settlement Agreement, VEON agreed to pay criminal fines of US $230 and to disgorge a total of US $375 , which was satisfied by the forfeiture to the DOJ of US $40 , a disgorgement to the SEC of US $167.5 and a further payment to the OM of US $167.5 beyond the criminal fines. VEON also consented to the entry of a judgment and incorporated consent (the “SEC Judgment” ), which was approved by the District Court on February 22, 2016, relating to the SEC’s complaint against VEON, which charged violations of the anti-bribery, books-and-records and internal controls provisions of the FCPA. Pursuant to the SEC Judgment, VEON agreed to a judgment ordering disgorgement of US $375 , to be satisfied by the forfeiture to the DOJ of US $40 , the disgorgement to the OM of US $167.5 , and a payment to the SEC of US $167.5 , and imposing a permanent injunction against future violations of the U.S. federal securities laws. The DPA, the Unitel guilty plea, the Dutch Settlement Agreement and the SEC Judgment comprise the terms of the resolution of the Company’s potential liabilities in the previously disclosed DOJ, SEC and OM investigations regarding VEON and Unitel. All amounts to be paid under the DPA, the Unitel guilty plea, the Dutch Settlement Agreement and the SEC Judgment were paid in the first quarter of 2016 and were deducted from the already existing provision of US $900 recorded in the third quarter of 2015 and disclosed in the 2015 annual consolidated financial statements. The remaining provision of US $105 as of December 31, 2015 , related to future direct and incremental expected legal fees associated with the resolutions. In 2018 , the Company paid US $7 in legal fees ( 2017 : US $14 ), utilizing this provision. The Company did not change its estimates in 2018 , keeping the provision at US $26 as of December 31, 2018 ( 2017 : US $33 ). The Company cannot currently estimate the magnitude of future costs to be incurred to comply with the DPA, the SEC Judgment and the Dutch Settlement Agreement, but these costs could be significant. CONTINGENT LIABILITIES The Group had contingent liabilities as of December 31, 2018 as set out below. VEON - Securities Class Action On November 4, 2015, a class action lawsuit was filed in the United States against VEON and certain of its current and former officers by Charles Kux-Kardos, on behalf of himself and other investors in the Company alleging certain violations of the United States federal securities laws in connection with the Company’s public disclosures relating to its operations in Uzbekistan. On December 4, 2015, a second complaint was filed by Westway Alliance Corp. that asserts essentially the same claims in connection with essentially the same disclosures. On April 27, 2016, the court consolidated the two actions and appointed Westway as lead plaintiff. On May 6, 2016, a motion for reconsideration was filed on the appointment of Westway as lead plaintiff and on September 26, 2016, the court affirmed the selection of Westway as the lead plaintiff. An amended complaint was filed on December 9, 2016. On September 19, 2017, the Court in the Southern District of New York rendered a decision granting in part VEON’s motion to dismiss the Amended Complaint. On February 9, 2018, VEON filed its Answer and Affirmative Defenses to the allegations that remain in the Amended Complaint after the Court’s September 19, 2017 Order. Motions to dismiss were filed by all the individual defendants on February 9, 2018. On April 13, 2018, plaintiff dismissed its claims voluntarily against one of the individual defendants. On August 30, 2018, the Court granted the motions to dismiss by all of the individual defendants remaining in the action, and the time for appeal has now expired. On December 3, 2018, VEON requested permission from the Court to file a motion for judgment on the pleadings, arguing Westway lacked standing as a result of the September 19, 2017 order because it had not purchased any securities on or after the date of the earliest alleged misstatement. That same day, Westway requested permission to file a Second Amended Complaint to add three additional named plaintiffs in an effort to cure this deficiency. On December 6, 2018, VEON and Westway filed oppositions to each other’s applications. The parties’ cross-applications remain pending with the Court. The Company intends to vigorously defend the action at all phases moving forward. GTH - License Fees Tax Litigation The Egyptian Tax Authority ( “ETA” ) conducted a review of Global Telecom Holding S.A.E ( “GTH” ) tax filings for the years 2000-2004. Following the review, in May 2010, the Internal Committee of the ETA assessed additional tax liabilities in the amount of approximately Egyptian pound ( “EGP” ) 2 billion (US $113 ) against GTH for these years. The basis for the assessment was that, according to the ETA, GTH’s investments in Algeria, Syria, Iraq, Tunisia and Sub-Saharan Africa during these years were actually license fees paid to foreign governments for which Egyptian withholding tax was due according to Egyptian tax laws. On May 14, 2012, the Appellate Committee reduced the assessed amount to EGP 323 million (US $18 ). GTH agreed to pay the assessed amount of EGP 323 million (US $18 ) in instalments on a without prejudice basis, which it has satisfied, and also appealed the Appellate Committee’s decision to the North Cairo Court of First Instance. The ETA also challenged the Appellate Committee’s decision and is seeking to reinstitute its original assessment of EGP 2 billion (US $113 ) plus late payment interest. The proceedings remain ongoing before the court. On December 20, 2018 GTH submitted a settlement application to the Tax Settlement Committee to review this case. Separately, on January 18, 2016, GTH, through its tax advisors, received a demand from the ETA claiming an amount of EGP 429 million (US $24 ) in late payment interest on the Appellate Committee’s assessment of EGP 323 million (US $18 ). The demand threatened administrative seizure of GTH’s assets in the event of non-payment. On February 17, 2016, GTH filed an appeal in the Administrative Court to challenge the demand and intends to vigorously defend itself. GTH – Iraqi Profits and Dividends Tax Litigation 2005 Tax Year In March 2011, the ETA conducted an audit of GTH’s tax filings for the year 2005. Following its review, the ETA concluded that income derived by TICL from Iraqna (“TICL-Iraqna Income” ) for that year should be included in GTH’s tax return and taxed at 20% , and accordingly claimed additional corporate income tax of EGP 235 million (US $13 ). GTH challenged the ETA’s claim before the Internal Committee of the ETA arguing that the TICL-Iraqna Income should be fully exempt from Egyptian corporate income tax pursuant to the Iraq-Egypt double taxation treaty. On December 20, 2018 GTH submitted a settlement application to the Tax Settlement Committee to review this case Separately, on January 18, 2016, GTH, through its tax advisors, received a demand from the ETA claiming an amount of EGP 235 million (US $13 ) assessed together with late payment interest of EGP 258 million (US $15 ). The demand threatened administrative seizure of GTH’s assets in the event of non-payment. On February 17, 2016, GTH filed an appeal in the Administrative Court to challenge the demand and intends to vigorously defend itself. On February 24, 2016, GTH received an updated demand from the ETA claiming EGP 505 million (EGP 235 million principal plus EGP 270 million interest), which GTH objected to. On December 28, 2017, GTH was notified that administrative seizure orders had been issued against various banks used by GTH in Egypt. On January 14, 2018, GTH registered a contestation of the enforcement which suspended the operability of the seizure orders until the matter can be heard by the court. 2007 Tax Year In addition, during the audit conducted by the ETA in 2011 in respect GTH’s tax filings for the year 2007, the ETA concluded that GTH owed additional corporate income tax of EGP 282 million (US $16 ) in respect of dividends distributed by Iraqna to OTIL in 2007. After GTH disputed the claim on the basis of the Iraq-Egypt double taxation treaty, the ETA referred the dispute to the Internal Committee, who upheld the ETA’s position. GTH appealed the Internal Committee’s decision to the Appeal Committee, which notified GTH of its decision to uphold the ETA's position on August 2, 2018. On September 30, 2018, GTH appealed the Appellate Committee’s decision to the Administrative Court where proceedings are ongoing. On December 20, 2018 GTH submitted a settlement application to the Tax Settlement Committee to review this case. Canadian action brought by the Catalyst Capital group Inc. VEON is a defendant in an action brought in 2016 by The Catalyst Capital Group Inc. ( “Catalyst” ) for CAD 1.3 billion (US $1,034 ) alleging breach of contract in the Superior Court of Justice in Ontario, Canada. In 2014, Catalyst and the company entered into an exclusivity agreement in connection with negotiations for the sale of the company’s WIND Mobile business. Catalyst alleges that the company and its financial advisor, UBS Securities Canada Inc., breached their exclusivity agreement obligations, which in turn enabled the sale of WIND Mobile to a consortium of other investors, who are also named co-defendants. The company filed a Statement of Defense denying all allegations and intends to vigorously contest the matter. VEON’s motion to dismiss the claim (as well as motions of all other defendants) was heard August 16-18, 2017. On April 18, 2018, VEON’s motion was granted (as well as the motions of all the other defendants) and Catalyst’s claim was dismissed as an abuse of process. On May 18, 2018, Catalyst appealed the decision to the Ontario Court of Appeal. The appeal hearing was held on February 19-20, 2019. A decision remains pending. VAT on Replacement SIMs June 2009 to December 2011 On April 1, 2012, the National Board of Revenue ( “NBR” ) issued a demand to Banglalink for BDT 7.74 billion (US $94 ) for unpaid SIM tax (VAT and supplementary duty). The NBR alleged that Banglalink evaded SIM tax on new SIM cards by issuing them as replacements. On the basis of 5 random SIM card purchases made by the NBR, the NBR concluded that all SIM card replacements issued by Banglalink between June 2009 and December 2011 ( 7,021,834 in total) were new SIM connections and subject to tax. Similar notices were sent to three other operators in Bangladesh. Banglalink and the other operators filed separate petitions in the High Court, which stayed enforcement of the demands. In an attempt to assist the NBR in resolving the dispute, the Government ordered the NBR to form a Review Committee comprised of the NBR, the Commissioner of Taxes ( “LTU” ), Bangladesh Telecommunication Regulatory Commission ( “BTRC” ), AMTOB and the operators (including Banglalink). The Review Committee identified a methodology to determine the amount of unpaid SIM tax and, after analyzing 1,200 randomly selected SIM cards issued Banglalink, determined that only 4.83% were incorrectly registered as replacements. The Review Committee’s interim report was signed off by all the parties, however, the Convenor of the Review Committee reneged on the interim report and unilaterally published a final report that was not based on the interim report or the findings of the Review Committee. The operators objected to the final report. The NBR Chairman and operators’ representative agreed that the BTRC would prepare further guidelines for verification of SIM users. Although the BTRC submitted its guidelines (under which Bangalink’s exposure was determined to be 8.5% of the original demand), the Convenor of the Review Committee submitted a supplementary report which disregarded the BTRC’s guidelines and assessed Banglalink’s liability for SIM tax to be BDT 7.62 billion (US $92 ). The operators refused to sign the supplementary report. On May 18, 2015, Banglalink received an updated demand from the LTU claiming Banglalink had incorrectly issued 6,887,633 SIM cards as replacement SIM cards between June 2009 and December 2011 and required Banglalink to pay BDT 5.32 billion (US $64 ) in SIM tax. The demand also stated that interest may be payable. Similar demands were sent to the other operators. On June 25, 2015, Banglalink filed an application to the High Court to stay the updated demand, and a stay was granted. On August 13, 2015, Banglalink filed its appeal against the demand before the Appellate Tribunal and deposited 10% of the amount demanded in order to proceed. The other operators also appealed their demands. On May 26, 2016, Banglalink presented its legal arguments and on September 28, 2016, the appeals of all the operators were heard together The Bangladesh Appellate Tribunal rejected the appeal of Banglalink and all other operators on June 22, 2017. On July 11, 2017, Banglalink filed an appeal of the Appellate Tribunal’s judgment with the High Court Division of the Supreme Court of Bangladesh. July 2012 to June 2015 On November 20, 2017 the LTU issued a final demand to Banglalink for BDT 1.69 billion (US $20 ) for unpaid tax on SIM card replacements issued by Banglalink between July 2012 and June 2015. On February 20, 2018, Banglalink filed its appeal against this demand before the Appellate Tribunal and deposited 10% of the amount demanded in order to proceed. The operators continue to engage in discussions with the government in an attempt to resolve the dispute. As of December 31, 2017 , the Company has recorded a provision of US $11 ( 2016 : US $11 ). Other contingencies and uncertainties In addition to the individual matters mentioned above, the Company is involved in other disputes, litigation and regulatory inquiries and investigations, both pending and threatened, in the ordinary course of its business. The total value of all other individual contingencies above US $5 other than disclosed above amounts to US $68 ( 2017 : US $107 ). The Company does not expect any liability arising from these contingencies to have a material effect on the results of operations, liquidity, capital resources or financial position of the Company. Furthermore, the Company believes it has provided for all probable liabilities arising in the ordinary course of its business. For the ongoing matters described above, where the Company has concluded that the potential loss arising from a negative outcome in the matter cannot be estimated, the Company has not recorded an accrual for the potential loss. However, in the event a loss is incurred, it may have an adverse effect on the results of operations, liquidity, capital resources, or financial position of the Company. ACCOUNTING POLICIES Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are discounted using a current pre-tax rate if the time value of money is significant. Contingent liabilities are possible obligations arising from past events, whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group. SOURCE OF ESTIMATION UNCERTAINTY The Group is involved in various legal proceedings, disputes and claims, including regulatory discussions related to the Group’s business, licenses, tax positions and investments, and the outcomes of these are subject to significant uncertainty. Management evaluates, among other factors, the degree of probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of loss. Unanticipated events or changes in these factors may require the Group to increase or decrease the amount recorded for a matter that has not been previously recorded because it was not considered probable. In the ordinary course of business, VEON may be party to various legal and tax proceedings, including as it relates to compliance with the rules of the telecom regulators in the countries in which VEON operates, competition law and anti-bribery and corruption laws, including the U.S. Foreign Corrupt Practices Act ( “FCPA” ). Non-compliance with such rules and laws may cause VEON to be subject to claims, some of which may relate to the developing markets and evolving fiscal and regulatory environments in which VEON operates. In the opinion of management, VEON’s liability, if any, in all pending litigation, other legal proceeding or other matters, other than what is discussed in this Note, will not have a material effect upon the financial condition, results of operations or liquidity of VEON. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2018 | |
Major components of tax expense (income) [abstract] | |
INCOME TAXES | INCOME TAXES Current income tax is the expected tax expense, payable or receivable on taxable income or loss for the period, using tax rates enacted or substantively enacted at reporting date, and any adjustment to tax payable in respect of previous years. Income tax expense consisted of the following for the years ended December 31 : 2018 2017 2016 Current income taxes Current year 477 397 615 Adjustments in respect of previous years 9 (28 ) (3 ) Total current income taxes 486 369 612 Deferred income taxes Origination / reversal of temporary differences (419 ) (159 ) (217 ) Changes in tax rates 6 10 (7 ) Current year tax losses unrecognized 283 146 172 Recognition / utilization of previously unrecognized tax losses or tax credits (16 ) — (15 ) Derecognition of previously recognized tax losses — — 95 Write off deferred tax assets — 20 — Adjustments in respect of previous years 28 86 — Other 1 — (5 ) Total deferred tax expense (117 ) 103 23 Income tax expense 369 472 635 EFFECTIVE TAX RATE The table below outlines the reconciliation between the statutory tax rate in the Netherlands ( 25% ) and the effective income tax rates for the Group, together with the corresponding amounts, for the years ended December 31 : 2018 2017 2016 Profit / (loss) before tax from continuing operations (248 ) 328 288 Income tax benefit / (expense) at statutory tax rate (25.0%) 62 (82 ) (72 ) Difference due to the effects of: Different tax rates in different jurisdictions 89 84 (152 ) Non-deductible expenses (120 ) (117 ) (89 ) Non-taxable income 49 35 66 Adjustments in respect of previous years (39 ) (52 ) 3 Movement in (un)recognized deferred tax assets (354 ) (166 ) (247 ) Withholding taxes 45 (123 ) (62 ) Tax claims (17 ) (24 ) (59 ) Change in income tax rate (6 ) (10 ) 7 Minimum taxes and other (78 ) (17 ) (30 ) Income tax benefit / (expense) (369 ) (472 ) (635 ) Effective tax rate -148.8 % 143.9 % 220.5 % EXPLANATORY NOTES TO THE EFFECTIVE TAX RATE Reason Explanation Different tax rates in different jurisdictions Certain jurisdictions in which VEON operates have income tax rates which are different to the Dutch statutory tax rate of 25%. Profitability in countries with higher tax rates (including Pakistan, Uzbekistan and Bangladesh) has a negative impact on the effective tax rate. Non-deductible expenses Impairment losses on property and equipment, intangible assets and goodwill are generally treated as non-deductible expenses for tax purposes, except where the impairment loss results in a change to a temporary difference. In 2018, impairment losses described in Note 11 had a negative impact on the effective tax rate, except for Bangladesh, where existing deferred tax liabilities on these assets had the effect of offsetting this impact. Non-taxable income The Group earns non-taxable income primarily in its holding companies, relating to gains on sale of subsidiaries, unrealized foreign exchange gains and certain income classified as non-taxable in accordance with the Final Tax Regime in Pakistan. Adjustments in respect of previous years The tax legislation in the markets in which VEON operates is unpredictable and gives rise to significant uncertainties (see ‘Sources of estimation uncertainty’ below). Movement in (un)recognized deferred tax assets Movements in recognized deferred tax assets are primarily caused by tax losses for which no deferred tax asset has been recognized. Withholding taxes Withholding taxes are recognized to the extent that dividends from foreign operations are expected to be paid in the foreseeable future. Tax claims Tax claims relate primarily to increases in uncertain tax positions in GTH. Change in income tax rate Changes in tax rates impact the valuation of existing temporary differences. Minimum taxes and other Minimum taxes and other relate primarily to the recording of alternative minimum and local taxes in Pakistan. DEFERRED TAXES The Group reported the following deferred tax assets and liabilities in the statement of financial position as of December 31 : 2018 2017 Deferred tax assets 197 336 Deferred tax liabilities (180 ) (376 ) Net deferred tax position 17 (40 ) The following table shows the movements of the deferred tax assets and liabilities in 2018 : Movement in deferred taxes Opening balance Net income statement movement Changes in composition of the group Other comprehensive & other Currency translation Closing balance Property and equipment (443 ) 126 — (3 ) 45 (275 ) Intangible assets (165 ) 94 — (2 ) 13 (60 ) Trade receivables 36 (6 ) — 3 (1 ) 32 Provisions 33 2 — (5 ) — 30 Accounts payable 133 7 — (11 ) (16 ) 113 Withholding tax on distributed earnings (116 ) 70 — (3 ) (1 ) (50 ) Tax losses and other balances carried forwards 2,434 (191 ) — (19 ) (51 ) 2,173 Non-recognized deferred tax assets (1,980 ) — — 25 — (1,955 ) Other 28 15 — (33 ) (1 ) 9 Net deferred tax positions (40 ) 117 — (48 ) (12 ) 17 The following table shows the movements of the deferred tax assets and liabilities in 2017 : Movement in deferred taxes Opening balance Net income statement movement Changes in composition of the group Other comprehensive & other Currency translation Closing balance Property and equipment (420 ) (6 ) — (13 ) (4 ) (443 ) Intangible assets (166 ) — — (4 ) 5 (165 ) Trade receivables 30 19 — (4 ) (9 ) 36 Provisions 29 3 — (3 ) 4 33 Accounts payable 94 38 — 28 (27 ) 133 Withholding tax on distributed earnings (73 ) (43 ) — 1 (1 ) (116 ) Tax losses and other balances carried forwards 2,270 (47 ) — 261 (50 ) 2,434 Non-recognized deferred tax assets (1,849 ) — — (131 ) — (1,980 ) Other 97 (67 ) — (35 ) 33 28 Net deferred tax positions 12 (103 ) — 100 (49 ) (40 ) Unused tax losses and other credits carried forwards VEON recognizes a deferred tax asset for unused tax losses and other credits carried forwards, to the extent that it is probable that the deferred tax asset will be utilized. The amount and expiry date of unused tax losses and other carry forwards for which no deferred tax asset is recognized are as follows: As of December 31, 2018 0-5 years 6-10 years More than 10 years Indefinite Total Tax losses expiry Recognized losses (83 ) — — (425 ) (508 ) Recognized DTA 17 — — 146 163 Non-recognized losses (968 ) (2,421 ) — (6,346 ) (9,735 ) Non-recognized DTA 198 497 — 1,260 1,955 Other credits carried forwards expiry Recognized credits (55 ) — — — (55 ) Recognized DTA 55 — — — 55 Non-recognized credits — — — — — Non-recognized DTA — — — — — As of December 31, 2017 0-5 years 6-10 years More than 10 years Indefinite Total Tax losses expiry Recognized losses (347 ) (12 ) — (833 ) (1,192 ) Recognized DTA 85 3 — 234 322 Non-recognized losses (420 ) (2,639 ) — (6,396 ) (9,455 ) Non-recognized DTA 95 660 — 1,232 1,987 Other credits carried forwards expiry Recognized credits (68 ) — — — (68 ) Recognized DTA 68 — — — 68 Non-recognized credits — — — — — Non-recognized DTA — — — — — Losses mainly relate to our holding entities in Luxembourg ( 2018 : US $6,135 ; 2017 : US $6,532 ) and the Netherlands ( 2018 : US $2,762 ; 2017 : US $2,474 ). VEON reports the tax effect of the existence of undistributed profits that will be distributed in the foreseeable future. The Company has a deferred tax liability of US $50 ( 2017 : US $116 ), relating to the tax effect of the undistributed profits that will be distributed in the foreseeable future, primarily in its Russian, Algerian and Pakistan operations. As of December 31, 2018 , undistributed earnings of VEON’s foreign subsidiaries (outside the Netherlands) which are indefinitely invested and will not be distributed in the foreseeable future, amounted to US $6,330 ( 2017 : US $6,833 ). Accordingly, no deferred tax liability is recognized for this amount of undistributed profits. TAXES RECORDED OUTSIDE THE INCOME STATEMENT In 2018 , the amount of current and deferred taxes reported outside of the income statement amounts to US $(69) comprising of US $(22) current tax charge and US $(47) deferred tax charge. INCOME TAX ASSETS The Company reported both current and non-current income tax assets, totaling US $144 ( 2017 : US $258 ), see Note 7. These tax assets mainly relate to advance tax payments in Pakistan, Bangladesh and Ukraine which can only be offset against income tax liabilities in fiscal periods subsequent to balance sheet date. ACCOUNTING POLICIES Income taxes Income tax expense represents the aggregate amount determined on the profit for the period based on current tax and deferred tax. In cases where the tax relates to items that are charged to other comprehensive income or directly to equity, the tax is also charged respectively to other comprehensive income or directly to equity. Uncertain tax positions The Group’s policy is to comply with the applicable tax regulations in the jurisdictions in which its operations are subject to income taxes. The Group’s estimates of current income tax expense and liabilities are calculated assuming that all tax computations filed by the Company’s subsidiaries will be subject to a review or audit by the relevant tax authorities. The Company and the relevant tax authorities may have different interpretations of how regulations should be applied to actual transactions (refer below for details regarding risks and uncertainties). Deferred taxation Deferred taxes are recognized using the liability method and thus are computed as the taxes recoverable or payable in future periods in respect of deductible or taxable temporary differences between the tax bases of assets and liabilities and their carrying amounts in the Company’s financial statements. SOURCE OF ESTIMATION UNCERTAINTY Tax risks The tax legislation in the markets in which VEON operates is unpredictable and gives rise to significant uncertainties, which could complicate our tax planning and business decisions. Tax laws in many of the emerging markets in which we operate have been in force for a relatively short period of time as compared to tax laws in more developed market economies. Tax authorities in our markets are often somewhat less advanced in their interpretation of tax laws, as well as in their enforcement and tax collection methods. Any sudden and unforeseen amendments of tax laws or changes in the tax authorities’ interpretations of the respective tax laws and/or double tax treaties, could have a material adverse effect on our future results of operations, cash flows or the amounts of dividends available for distribution to shareholders in a particular period (e.g. introduction of transfer pricing rules, Controlled Foreign Operation ( “CFC” ) legislation and more strict tax residency rules). Management believes that VEON has paid or accrued all taxes that are applicable. Where uncertainty exists, VEON has accrued tax liabilities based on management’s best estimate. From time to time, we may also identify tax contingencies for which we have not recorded an accrual. Such unaccrued tax contingencies could materialize and require us to pay additional amounts of tax. Recoverability of deferred tax assets Deferred tax assets are recognized to the extent that it is probable that the assets will be realized. Significant judgment is required to determine the amount that can be recognized and depends foremost on the expected timing, level of taxable profits, tax planning strategies and the existence of taxable temporary differences. Estimates made relate primarily to losses carried forward in some of the Group’s foreign operations. When an entity has a history of recent losses, the deferred tax asset arising from unused tax losses is recognized only to the extent that there is convincing evidence that sufficient future taxable profit will be generated. Estimated future taxable profit is not considered such evidence unless that entity has demonstrated the ability by generating significant taxable profit for the current year or there are certain other events providing sufficient evidence of future taxable profit. New transactions and the introduction of new tax rules may also affect judgments due to uncertainty concerning the interpretation of the rules and any transitional rules. Uncertain tax positions Uncertain tax positions are recognized when it is probable that a tax position will not be sustained, and the amount can be reliably measured. The expected resolution of uncertain tax positions is based upon management’s judgment of the likelihood of sustaining a position taken through tax audits, tax courts and/or arbitration, if necessary. Circumstances and interpretations of the amount or likelihood of sustaining a position may change through the settlement process. Furthermore, the resolution of uncertain tax positions is not always within the control of the Group and it is often dependent on the efficiency of the legal processes in the relevant taxing jurisdictions in which the Group operates. Issues can, and often do, take many years to resolve. |
SIGNIFICANT TRANSACTIONS
SIGNIFICANT TRANSACTIONS | 12 Months Ended |
Dec. 31, 2018 | |
SIGNIFICANT TRANSACTIONS | |
SIGNIFICANT TRANSACTIONS | SIGNIFICANT TRANSACTIONS Sale of Italy Joint Venture On July 3, 2018, VEON entered into an agreement with CK Hutchison Holdings Ltd for the sale of its 50% stake in the Italy Joint Venture. The Italy Joint Venture included VIP-CKH Luxembourg S.à r.l and its subsidiaries, which hold the combined businesses of Wind and 3 Italia, and the financing company VIP-CKH Ireland Limited. On September 7, 2018 the transaction was completed, and cash consideration was received in the amount of EUR 2,450 million (US $2,830 ). The effect of the disposal is detailed below: 2018 Cash consideration received 2,830 Derecognition of assets classified as held for sale (1,599 ) Release cumulative share of other comprehensive income / (loss) of Italy Joint Venture (31 ) Release cumulative foreign currency translation reserve related to Italy Joint Venture * 79 Gain / (loss) on disposal of discontinued operations 1,279 * Included in the release of cumulative foreign currency translation reserve is an accumulated loss of US $80 , arising from the release of the net investment hedge related to the Company’s investment in the Italy Joint Venture. Following the classification as a disposal group held for sale, on June 30, 2018, the Company ceased accounting for the investment in the Italy Joint Venture using the equity method of accounting. The table below provides the details of share of profit / (loss) and share of other comprehensive income / (loss) of the Italy Joint Venture for the following years: Discontinued operations 2018 2017 2016 Share of profit / (loss) of Italy Joint Venture (300 ) (390 ) 59 Share of other comprehensive income / (loss) of Italy Joint Venture (18 ) (12 ) — Termination of Deodar sale On September 15, 2018, VEON terminated the agreement for the sale of its subsidiary, Deodar, which was previously classified as a disposal group held for sale on June 30, 2017. The transaction was terminated due to the parties failing to receive all required regulatory approvals and the extended long-stop date of September 14, 2018 having passed. As a result of this termination, the Company amended prior periods presented in these consolidated financial statements to retrospectively recognize the depreciation charge that would have been recognized, had the disposal group not been classified as held for sale. The following table shows the impact of the retrospective recognition of depreciation expense in profit or loss for the period ended December 31, 2017 and reversal of the reclassification of Deodar assets and liabilities as held for sale on VEON’s balance sheet as of December 31, 2017 : Balance sheet as reported Retrospective depreciation recorded in 2017 Reclassification Adjusted balance sheet Assets Property and equipment 6,097 (37 ) 177 6,237 Goodwill 4,394 — 224 4,618 Deferred tax assets 272 — 64 336 Other non-current assets 199 — 2 201 Other current assets 2,443 — 44 2,487 Assets classified as held for sale 533 — (511 ) 22 Equity Equity attributable to equity owners of the parent 4,352 (21 ) — 4,331 Equity of non-controlling interest (425 ) (16 ) — (441 ) Liabilities Non-current liabilities 10,937 — 7 10,944 Current liabilities 4,607 — 28 4,635 Liabilities associated with assets held for sale 50 — (35 ) 15 Exit from Euroset Holding N.V. Joint Venture On July 7, 2017, PJSC VimpelCom, a subsidiary of the Company, entered into a Framework Agreement with PJSC MegaFon ( “MegaFon” ) to unwind their retail joint venture, Euroset Holding N.V. ( “Euroset” ). Under the agreement, MegaFon acquired PJSC VimpelCom’s 50% interest in Euroset and PJSC VimpelCom paid RUB 1.20 billion (US $21 ) and acquired rights to 50% of Euroset’s approximately 4,000 retail stores in Russia. The transaction was completed on February 22, 2018 and was accounted for as an asset acquisition, primarily the acquisition of contract-based intangible assets (see Note 13) representing the right to use retail stores. Withdrawal of mandatory tender offer in relation to Global Telecom Holding S.A.E On April 2, 2018, VEON notified the Egyptian Financial Regulatory Authority (FRA) that, given the lapse of time and absence of FRA approval, VEON was withdrawing the Mandatory Tender Offer (MTO) filed on November 8, 2017, and did not intend to proceed with another MTO at that time. Cash in an amount of US $987 , which had been pledged as collateral for the MTO, was released during the first quarter of 2018. ACCOUNTING POLICIES Transactions with non-controlling interests that do not result in loss of control Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the owners in their capacity as owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity. Non-current assets (or disposal groups) held for sale and discontinued operations Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction or loss of control rather than through continuing use, and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell. Non-current assets (including those that are part of a disposal group) are not depreciated or amortized while they are classified as held for sale. Assets and liabilities of a disposal group classified as held for sale are presented separately from the other assets and liabilities in the statement of financial position. A discontinued operation is a component that is classified as held for sale and that represents a separate major line of business or geographical area of operations. Discontinued operations are excluded from the results of continuing operations and are presented as a single amount in the income statement. All other Notes to the financial statements include amounts for continuing operations, unless otherwise mentioned. |
IMPAIRMENT
IMPAIRMENT | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of impairment loss and reversal of impairment loss [abstract] | |
IMPAIRMENT | IMPAIRMENT OF ASSETS Property and equipment and intangible assets are tested regularly for impairment. The Company assesses, at the end of each reporting period, whether there exist any indicators that an asset may be impaired (i.e. asset becoming idle, damaged or no longer in use). If there are such indicators, the Company estimates the recoverable amount of the asset. Impairment losses of continuing operations are recognized in the income statement in a separate line item. Goodwill is tested for impairment annually (at October 1) or when circumstances indicate the carrying value may be impaired. The Company’s impairment test is primarily based on fair value less cost of disposal calculations (Level 3 in the fair value hierarchy) that use a discounted cash flow model, using cash flow projections from business plans prepared by management. The Company considers the relationship between its market capitalization and its book value, as well as weighted average cost of capital and the quarterly financial performances of each cash-generating units ( “CGU” ) when reviewing for indicators of impairment in interim periods. Impairment losses in 2018 In 2018 , due to operational underperformance of its operations in Algeria, Armenia, Bangladesh, Georgia and Kyrgyzstan, the Company has revised its previous estimates and assumptions regarding the future cash flows of these CGU’s. As a result, the Company recorded an impairment of US $858 against the carrying values of these CGU’s as of September 30, 2018. 2018 Property and equipment Intangible assets Goodwill Total impairment Algeria — — 125 125 Armenia 46 10 25 81 Bangladesh 221 230 — 451 Georgia 31 19 — 50 Kyrgyzstan — — 74 74 Other 37 40 — 77 335 299 224 858 For these CGU’s, impairment losses were allocated first to the existing carrying value of goodwill, and then subsequently to property and equipment and intangible assets based on relative carrying values. Additionally, in regard with the Company’s commitment to network modernization, the Company continuously reevaluates the plans for its existing network, including equipment purchased but not installed and intangible assets, and consequently recorded an impairment loss of US $77 . Impairment losses in 2017 During the 2017 annual impairment test, the Company recognized impairment losses in respect of the subsidiaries in Armenia and Kyrgyzstan in amounts of US $34 and US $17 , respectively, allocated to the existing carrying value of goodwill. The impairments were concluded largely due to lower cash flow outlook in those countries. 2017 Property and equipment Goodwill Total impairment Armenia — 34 34 Kyrgyzstan — 17 17 Other 15 — 15 15 51 66 Additionally, in connection with the rollout of the Company’s transformation strategy and commitment to network modernization, the Company continuously re-evaluates the plans for its existing network, including equipment purchased but not installed, and consequently recorded an impairment loss of US $15 . Impairment losses in 2016 During the 2016 annual impairment test, the Company concluded impairments for the CGUs Georgia and Kyrgyzstan in amounts of US $29 and US $49 , respectively. The impairments were concluded largely due to lower operating performances in those countries. The recoverable amounts of US $49 and US $219 , respectively, were determined based on a fair value less costs of disposal calculation using the latest cash flow projections (Level 3 fair value). The Company applied a post-tax discount of 10.3% and 14.5% , respectively. For the Georgia CGU, the carrying amount of goodwill was already nil prior to the impairment test. As such, the total amount of the impairment loss was allocated to the carrying amounts of property and equipment and intangible assets based on relative carrying value before the impairment. 2016 Property and equipment Intangible assets Goodwill Other assets* Total impairment Georgia 16 13 — — 29 Kyrgyzstan — — 49 — 49 Tajikistan 54 1 21 12 88 Other 30 — 8 — 38 100 14 78 12 204 * Other assets include trade and other receivables and deferred tax assets. Impairment of these assets has been recognized on the income statement accounts relating to these assets, i.e. Selling, general and administrative expenses and Income tax expense. KEY ASSUMPTIONS The recoverable amounts of CGUs have been determined based on fair value less costs of disposal calculations, using cash flow projections from business plans prepared by management. The Company bases its impairment calculation on detailed budgets and forecast calculations which are prepared separately for each of the Company’s CGUs. These budgets and forecast calculations are prepared for a period of five years. A long-term growth rate is applied to project future cash flows after the fifth year. The table below shows key assumptions used in fair value less costs of disposal calculations. Discount rate (local currency) Average annual revenue growth rate during forecast period Terminal growth rate 2018 2017 2016 2018 2017 2016 2018 2017 2016 Russia 10.3 % 10.6 % 9.7 % 1.1 % 1.9 % 2.4 % 1.3 % 1.0 % 1.0 % Ukraine 16.3 % 17.1 % 17.2 % 4.4 % 3.9 % 3.6 % 4.0 % 2.0 % 1.0 % Algeria 11.1 % 10.7 % 9.8 % 0.7 % 1.0 % (0.8 )% 0.9 % 3.0 % 3.0 % Pakistan 14.4 % 15.0 % 14.3 % 3.5 % 5.0 % 7.6 % 4.0 % 4.0 % 4.0 % Bangladesh 12.2 % 12.7 % 11.9 % 0.6 % 5.0 % 6.4 % 4.0 % 4.6 % 4.7 % Kazakhstan 8.4 % 10.8 % 12.4 % 2.8 % 3.2 % 4.4 % 1.1 % 2.4 % 2.0 % Kyrgyzstan 14.8 % 15.5 % 14.5 % 2.8 % (1.5 )% (1.8 )% 5.0 % 3.5 % 2.5 % Uzbekistan 13.1 % 15.3 % 15.4 % 5.5 % 6.9 % 1.7 % 6.3 % 6.5 % 1.0 % Armenia 12.5 % 13.0 % 12.0 % 0.2 % (1.0 )% (2.8 )% 0.8 % 3.0 % 1.0 % Georgia 10.6 % 11.0 % 10.3 % 2.1 % 5.6 % 6.4 % 3.0 % 1.0 % 1.0 % Average operating margin Average CAPEX as a percentage of revenue 2018 2017 2016 2018 2017 2016 Russia 34.6 % 36.4 % 38.6 % 19.8 % 15.7 % 15.9 % Ukraine 54.0 % 49.9 % 44.9 % 16.3 % 15.6 % 17.0 % Algeria 44.0 % 46.2 % 50.8 % 15.1 % 14.8 % 15.8 % Pakistan 47.9 % 43.6 % 33.3 % 16.7 % 15.3 % 14.3 % Bangladesh 35.4 % 38.7 % 44.9 % 14.9 % 14.3 % 14.6 % Kazakhstan 46.5 % 44.5 % 43.6 % 17.7 % 17.9 % 18.8 % Kyrgyzstan 39.9 % 42.0 % 43.9 % 17.2 % 16.4 % 17.0 % Uzbekistan 43.9 % 42.9 % 58.2 % 16.2 % 14.1 % 18.2 % Armenia 23.6 % 29.7 % 37.8 % 21.0 % 19.6 % 14.1 % Georgia 24.5 % 25.2 % 25.7 % 23.8 % 23.3 % 17.3 % Assumption Description Discount rate Discount rates are initially determined in US$ based on the risk-free rate for 20-year maturity bonds of the United States Treasury, adjusted for a risk premium to reflect both the increased risk of investing in equities and the systematic risk of the specific CGU relative to the market as a whole. The equity market risk premium used was 5.4% (2017: 6.0%). The systematic risk, beta, represents the median of the raw betas of the entities comparable in size and geographic footprint with the ones of the Company ( “Peer Group” ). The debt risk premium is based on the median of Standard & Poor’s long-term credit rating of the Peer Group. The weighted average cost of capital is determined based on target debt-to-equity ratios representing the median historical five-year capital structure for each entity from the Peer Group. The discount rate in functional currency of a CGU is adjusted for the long-term inflation forecast of the respective country in which the business operates, as well as applicable country risk premium. Projected revenue growth rates The revenue growth rates vary based on numerous factors, including size of market, GDP (Gross Domestic Product), foreign currency projections, traffic growth, market share and others. Projected average operating margin The Company estimates operating margin based on Adjusted EBITDA divided by Total Operating Revenue for each CGU and each future year. The forecasted operating margin is based on the budget of the following year and assumes cost optimization initiatives which are part of on-going operations, as well as regulatory and technological changes known to date, such as telecommunication license issues and price regulation among others. Average capital expenditure as a percentage of revenue Capital expenditure ( “CAPEX” ) is defined as purchases of property and equipment and intangible assets other than goodwill. The cash flow forecasts for capital expenditure are based on past experience and amounts budgeted for the following year(s) and include the network roll-outs plans and license requirements. Projected license and spectrum payments The cash flow forecasts for license and spectrum payments for each operating company for the initial five years include amounts for expected renewals and newly available spectrum. Beyond that period, a long-run cost of spectrum is assumed. Long-term growth rate A long‑term growth rate into perpetuity is estimated based on a percentage that is lower than or equal to the country long-term inflation forecast, depending on the CGU. SOURCE OF ESTIMATION UNCERTAINTY The Group has significant investments in property and equipment, intangible assets, goodwill and other investments. Estimating recoverable amounts of assets and CGUs must, in part, be based on management’s evaluations, including the determination of the appropriate CGUs, the relevant discount rate, estimation of future performance, the revenue-generating capacity of assets, timing and amount of future purchases of property and equipment, assumptions of future market conditions and the long-term growth rate into perpetuity (terminal value). In doing this, management needs to assume a market participant perspective. Changing the assumptions selected by management, in particular, the discount rate and growth rate assumptions used to estimate the recoverable amounts of assets, could significantly impact the Group’s impairment evaluation and hence results. A significant part of the Group’s operations is in countries with emerging markets. The political and economic situation in these countries may change rapidly and recession may potentially have a significant impact on these countries. On-going recessionary effects in the world economy and increased macroeconomic risks impact our assessment of cash flow forecasts and the discount rates applied. There are significant variations between different markets with respect to growth, mobile penetration, average revenue per user ( “ARPU” ), market share and similar parameters, resulting in differences in operating margins. The future development of operating margins is important in the Group’s impairment assessments, and the long-term estimates of these margins are highly uncertain. This is particularly the case for emerging markets that are not yet in a mature phase. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2018 | |
Property, plant and equipment [abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT The following table summarizes the movement in the net book value of property and equipment for the years ended December 31 : Net book value Telecomm-unications equipment Land, Office and other equipment Equipment not installed and assets under construction Total As of January 1, 2017 5,166 243 456 854 6,719 Additions 39 14 26 1,194 1,273 Disposals (36 ) — (7 ) (6 ) (49 ) Depreciation charge for the year (1,307 ) (32 ) (152 ) — (1,491 ) Impairment (5 ) — — (10 ) (15 ) Transfers 1,440 16 147 (1,603 ) — Reclassified to assets held for sale (13 ) (1 ) (2 ) (1 ) (17 ) Translation adjustment (152 ) — 2 (33 ) (183 ) As of December 31, 2017 5,132 240 470 395 6,237 Additions 52 8 14 1,173 1,247 Disposals (51 ) (2 ) (10 ) (5 ) (68 ) Depreciation charge for the year (1,165 ) (31 ) (143 ) — (1,339 ) Impairment (280 ) (10 ) (8 ) (37 ) (335 ) Transfers 979 22 136 (1,137 ) — Reclassified to assets held for sale (15 ) (1 ) — — (16 ) Translation adjustment (644 ) (24 ) (66 ) (60 ) (794 ) As of December 31, 2018 4,008 202 393 329 4,932 Cost 10,758 443 1,271 459 12,931 Accumulated depreciation and impairment (6,750 ) (241 ) (878 ) (130 ) (7,999 ) There were no material changes in estimates related to property and equipment in 2018 other than the impairment described in Note 11 of US $335 ( 2017 : US $15 ). During 2018 , VEON acquired property and equipment in the amount of US $346 ( 2017 : US $441 ), which were not paid for as of year-end. Property and equipment pledged as security for bank borrowings amounts to US $750 as of December 31, 2018 ( 2017 : US $875 ), and primarily relate to securities for borrowings of PMCL (refer to Note 16 for details regarding amounts borrowed). COMMITMENTS Capital commitments for the future purchase of equipment are as follows as of December 31 : 2018 2017 Less than 1 year 433 555 Between 1 and 5 years 4 262 Total commitments 437 817 Telecom license capital commitments VEON’s ability to generate revenue in the countries it operates is dependent upon the operation of the wireless telecommunications networks authorized under its various licenses under GSM-900/1800 and “3G” (UMTS / WCDMA) mobile radiotelephony communications services and “4G” (LTE). Under the license agreements, operating companies are subject to certain commitments, such as territory or population coverage, level of capital expenditures, and number of base stations to be fulfilled within a certain timeframe. If we are found to be involved in practices that do not comply with applicable laws or regulations, we may be exposed to significant fines, the risk of prosecution or the suspension or loss of our licenses, frequency allocations, authorizations or various permissions, any of which could harm our business, financial condition, results of operations, or cash flows. After expiration of the license, our operating companies might be subject to additional payments for renewals, as well as new license capital and other commitments. In July 2012, PJSC VimpelCom was awarded a mobile license, a data transmission license, a voice transmission license and a telematic license for the provision of LTE services in Russia. The roll-out of the LTE network will occur through a phased approach based on a pre-defined schedule pursuant to the requirements of the license. The LTE services were launched in the middle of 2013 and offered in six regions in Russia by the end of the year. The services must be extended to a specific number of additional regions each year through to December 1, 2019 by when services must cover all of Russia. PJSC VimpelCom is required to comply with the following conditions among others under the terms of the license: (i) invest at least RUB 15 billion (US $260 ) in each calendar year, for which the Company continues to comply with to date in the construction of its federal LTE network until the network is completed, which must occur before December 1, 2019; (ii) provide certain data transmission services in all secondary and higher educational institutions in specified areas with population over 50 thousand ; and (iii) provide interconnection capability to telecommunications operators that provide mobile services using virtual networks in any five regions in Russia not later than July 25, 2016. The latter requirement was fulfilled by PJSC VimpelCom within the required time. ACCOUNTING POLICIES Property and equipment is stated at cost, net of any accumulated depreciation and accumulated impairment losses. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets as follows: Class of property and equipment Useful life Telecommunication equipment 3 – 20 years Buildings and constructions 10 – 50 years Office and other equipment 3 – 10 years Each asset’s residual value, useful life and method of depreciation is reviewed at the end of each financial year and adjusted prospectively, if necessary. SOURCE OF ESTIMATION UNCERTAINTY Depreciation and amortization of non-current assets Depreciation and amortization expenses are based on management estimates of useful life, residual value and amortization method of property and equipment and intangible assets. Estimates may change due to technological developments, competition, changes in market conditions and other factors and may result in changes in the estimated useful life and in the amortization or depreciation charges. Technological developments are difficult to predict and our views on the trends and pace of development may change over time. Some of the assets and technologies, in which the Group invested several years ago, are still in use and provide the basis for new technologies. The useful lives of property and equipment and intangible assets are reviewed at least annually, taking into consideration the factors mentioned above and all other relevant factors. Estimated useful lives for similar types of assets may vary between different entities in the Group due to local factors such as growth rate, maturity of the market, historical and expected replacements or transfer of assets and quality of components used. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of detailed information about intangible assets [abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS The following table summarizes the movement in the net book value of intangible assets for the years ended December 31 : Net book value Telecommuni-cation licenses, frequencies & permissions Software Brands and trademarks Customer relationships Other intangible assets Total As of January 1, 2017 1,128 380 358 337 54 2,257 Additions 332 178 — — 8 518 Disposals (1 ) (2 ) — — (1 ) (4 ) Amortization charge for the year (161 ) (206 ) (83 ) (75 ) (12 ) (537 ) Transfer — 4 — — (4 ) — Translation adjustment (42 ) (3 ) (13 ) (7 ) (1 ) (66 ) As of December 31, 2017 1,256 351 262 255 44 2,168 Additions 526 171 — — 20 717 Disposals (6 ) (1 ) — — — (7 ) Amortization charge for the year (176 ) (179 ) (74 ) (54 ) (12 ) (495 ) Impairment (251 ) (48 ) — — — (299 ) Transfer — 2 — — (2 ) — Translation adjustment (154 ) (32 ) (10 ) (24 ) (10 ) (230 ) As of December 31, 2018 1,195 264 178 177 40 1,854 Cost 2,365 1,006 527 1,675 254 5,827 Accumulated amortization and impairment (1,170 ) (742 ) (349 ) (1,498 ) (214 ) (3,973 ) During 2018 , there were no material change in estimates related to intangible assets 2018 other than the impairment described in Note 11 of US $299 ( 2017 : nil , 2016: US $14 ). During 2018 , VEON acquired intangible assets in the amount of US $100 ( 2017 : US $92 ), which were not yet paid for as of year-end. Acquisition of spectrum in Ukraine In January 2018, the Company’s wholly-owned subsidiary in Ukraine, Kyivstar, secured one of three licenses to provide nationwide 4G/LTE services. All approvals and licenses were obtained, and company successfully launched 4G throughout Ukraine on 08.04.2018 at 2600 MHZ and on 01.07.2018 at 1800 Mhz. Kyivstar has fulfilled all its current license obligations for 2600 MHz and 1800 MHz licenses required, some license obligations will arise in the future and will be fulfilled on ongoing basis. Kyivstar paid UAH 0.9 billion (US $32 ) for 15 MHz (paired) of contiguous frequency in the 2600 MHz band. In addition, in March 2018, Kyivstar was awarded the following spectrum in the 1800 MHz band suitable for 4G/LTE: • 25 MHz (paired) at UAH 1.325 billion (US $47 ); and • two lots of 5 MHz (paired) at UAH 1.512 billion (US $53 ). Acquisition of additional spectrum and 4G/LTE License in Bangladesh In February 2018, the Company’s wholly-owned subsidiary in Bangladesh, Banglalink, was awarded technology neutral spectrum in the 1800 and 2100 MHz bands. Banglalink will pay a total of US $308.6 for the spectrum excluding VAT. An upfront payment of 60% for the spectrum was paid in February 2018, with the remaining 40% payable over 4 years. In addition, Banglalink has paid US $35 to convert its existing spectrum holding in 900 MHz and 1800 MHz into technology neutral spectrum and a fee of BDT 100 million (US $1.2 ) to acquire the 4G/LTE license. COMMITMENTS Capital commitments for the future purchase of intangible assets are as follows as of December 31 : 2018 2017 Less than 1 year 23 40 Between 1 and 5 years — 4 Total commitments 23 44 ACCOUNTING POLICIES Intangible assets acquired separately are measured initially at cost and are subsequently measured at cost less accumulated amortization and impairment losses. Intangible assets with a finite useful life are generally amortized with the straight-line method over the estimated useful life of the intangible asset. The amortization period and the amortization method for intangible assets with finite useful lives are reviewed at least annually. SOURCE OF ESTIMATION UNCERTAINTY Depreciation and amortization of non-current assets Refer also to Note 12 for further details regarding source of estimation uncertainty. Significant estimates in the evaluation of useful lives for intangible assets include, but are not limited to, the estimated average customer relationship based on churn, the remaining license or concession period and the expected developments in technology and markets. The actual economic lives of intangible assets may be different than estimated useful lives, thereby resulting in a different carrying value of intangible assets with finite lives. We continue to evaluate the amortization period for intangible assets with finite lives to determine whether events or circumstances warrant revised amortization periods. A change in estimated useful lives is a change in accounting estimate, and depreciation and amortization charges are adjusted prospectively. |
GOODWILL
GOODWILL | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of impairment loss and reversal of impairment loss [abstract] | |
GOODWILL | GOODWILL The movement in goodwill for the Group, per cash generating unit ( “CGU” ), consisted of the following as of December 31, 2018 : CGU December 31, Impairment Currency translation December 31, Russia 2,018 — (416 ) 2,434 Algeria 1,176 (125 ) (39 ) 1,340 Pakistan 371 — (97 ) 468 Kazakhstan 153 — (24 ) 177 Kyrgyzstan 54 (74 ) — 128 Uzbekistan 44 — (2 ) 46 Armenia — (25 ) — 25 Total 3,816 (224 ) (578 ) 4,618 CGU December 31, Impairment Translation adjustment December 31, Russia 2,434 — 122 2,312 Algeria 1,340 — (53 ) 1,393 Pakistan 468 — (29 ) 497 Kazakhstan 177 — 1 176 Kyrgyzstan 128 (17 ) — 145 Uzbekistan 46 — (68 ) 114 Armenia 25 (34 ) — 59 Total 4,618 (51 ) (27 ) 4,696 ACCOUNTING POLICIES Goodwill is recognized for the future economic benefits arising from net assets acquired that are not individually identified and separately recognized. Goodwill is not amortized but is tested for impairment annually and as necessary when circumstances indicate that the carrying value may be impaired. |
INVESTMENTS IN SUBSIDIARIES
INVESTMENTS IN SUBSIDIARIES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of subsidiaries [abstract] | |
INVESTMENTS IN SUBSIDIARIES | INVESTMENTS IN SUBSIDIARIES The Company held investments in the material subsidiaries for the years ended December 31 as detailed in the table below. The equity interest presented represents the economic rights available to the Company. Equity interest held by the Group Name of significant subsidiary Country of incorporation Nature of subsidiary 2018 2017 VEON Amsterdam B.V. Netherlands Holding 100 % 100 % VEON Holdings B.V. Netherlands Holding 100 % 100 % PJSC VimpelCom Russia Operating 100 % 100 % JSC “Kyivstar” Ukraine Operating 100 % 100 % LLP “KaR-Tel” Kazakhstan Operating 75 % 75 % LLC “Unitel” Uzbekistan Operating 100 % 100 % LLC “VEON Georgia” Georgia Operating 80 % 80 % CJSC “VEON Armenia” Armenia Operating 100 % 100 % LLC “Sky Mobile” Kyrgyzstan Operating 50 % 50 % VEON Luxembourg Holdings S.à r.l. Luxembourg Holding 100 % 100 % VEON Luxembourg Finance Holdings S.à r.l. Luxembourg Holding 100 % 100 % VEON Luxembourg Finance S.A. Luxembourg Holding 100 % 100 % Global Telecom Holding S.A.E Egypt Holding 58 % 58 % Omnium Telecom Algérie S.p.A.* Algeria Holding 26 % 26 % Optimum Telecom Algeria S.p.A.* Algeria Operating 26 % 26 % Pakistan Mobile Communications Limited Pakistan Operating 49 % 49 % Banglalink Digital Communications Limited Bangladesh Operating 58 % 58 % LLC “Tacom” ** Tajikistan Operating — 98 % VimpelCom Lao Co. Ltd. ** Lao PDR Operating — 78 % * The Group has concluded that it controls Omnium Telecom Algérie S.p.A and Optimum Telecom Algeria S.p.A even though its subsidiary, Global Telecom Holding S.A.E. owns less than 50% of the ordinary shares. This is because the Company can exercise operational control through terms of a shareholders’ agreement. ** During 2018 , the Group sold its operations in Tajikistan and Laos, see below in this Note for further details. Pursuant to local laws and regulations and covenants in agreements relating to indebtedness, subsidiaries may be restricted from declaring or paying dividends to VEON. The company holds and controls its investments in Omnium Telecom Algérie S.p.A., Optimum Telecom Algeria S.p.A, Pakistan Mobile Communications Limited, Warid Telecom Limited and Banglalink Digital Communications Limited ( “Banglalink” ) through its subsidiary GTH, in which it holds a 57.7% interest as of balance sheet date. GAIN ON SALE OF SUBSIDIARIES During the second quarter of 2018, the Company sold its operations in Laos and Tajikistan to external parties, which were previously classified as disposal groups held for sale. The effect of the disposals is detailed below: Laos Tajikistan Other Total Net cash consideration received 22 — — 22 Derecognition of assets classified as held for sale (21 ) (13 ) — (34 ) Derecognition of liabilities classified as held for sale 13 25 10 48 Derecognition of non-controlling interests (6 ) — — (6 ) Release cumulative other comprehensive income related to disposal group 1 (1 ) — — Gain on disposal 9 11 10 30 Laos operations On October 27, 2017, VimpelCom Holding Laos B.V. (“ VimpelCom Laos ”), a subsidiary of the Company, entered into a Sale and Purchase Agreement for the sale of its operations in Laos to the Lao People’s Democratic Republic (“ Government of Laos ”). Under the agreement, VimpelCom Laos transferred its 78% interest in VimpelCom Lao Co. Limited (“ VIP Lao ”) to the Government of Laos, the minority shareholder, on a debt-free basis, in exchange for a purchase consideration of US $22 . Purchase consideration was received in two separate payments, on December 8, 2017 and February 22, 2018. The sale of Laos was completed on May 3, 2018. Tajikistan operations On April 5, 2018, VEON Holdings B.V., a fully-owned subsidiary of the Company, signed an agreement with ZET Mobile Limited ( “ZET” ) for the sale of 100% of shares in its subsidiary, Vimpelcom (BVI) AG, which owns 98% of shares in Tacom LLC ( “Tacom” ). The remaining 2% interest in Tacom was owned by the shareholder of ZET. Under the agreement, ZET has indirectly acquired 98% of shares in Tacom. The transaction was completed on June 8, 2018. Other gains In December 2018 , the Group completed the liquidation of Ring Distribution Company S.A.E., one of its subsidiaries in Egypt, which resulted in a gain of US $10 . MATERIAL PARTLY-OWNED SUBSIDIARIES Financial information of subsidiaries that have material non-controlling interests ( “NCIs” ) is provided below: Equity interest Book values of Profit / (loss) attributable to material NCIs Name of significant subsidiary 2018 2017 2018 2017 2018 2017 LLP “KaR-Tel” ( “Kar-Tel” ) 25.0% 25.0% 228 252 19 8 LLC “Sky Mobile” ( “Sky Mobile” ) 49.8% 49.8% 133 167 (32) 3 Global Telecom Holding S.A.E ( “GTH” ) 42.3% 42.3% (1,190) (793) (217) (40) Omnium Telecom Algérie S.p.A. ( “OTA” ) 73.7% 73.7% 1,091 1,235 1 100 The summarized financial information of these subsidiaries before intercompany eliminations for the years ended December 31 are detailed below. Note that the amount of non-controlling interests presented for OTA of 73.7% represents the non-controlling interests in Algeria of 54.4% and the non-controlling interests in GTH, the intermediate parent company in Egypt, of 42.3% . Summarized income statement Kar-Tel Sky Mobile GTH OTA 2018 2017 2016 2018 2017 2016 2018 2017* 2016 2018 2017 2016 Operating revenue 410 348 308 81 108 136 2,828 3,015 2,955 813 915 1,040 Operating expenses (319 ) (296 ) (255 ) (144 ) (97 ) (162 ) (2,810 ) (2,421 ) (2,463 ) (754 ) (703 ) (753 ) Other (expenses) / income 6 (7 ) 2 — (2 ) (12 ) (377 ) (450 ) (213 ) (11 ) (27 ) (33 ) Profit / (loss) before tax 97 45 55 (63 ) 9 (38 ) (359 ) 144 279 48 185 254 Income tax expense (20 ) (13 ) (14 ) (1 ) (4 ) (5 ) (124 ) (375 ) (144 ) (47 ) (49 ) (69 ) Profit / (loss) for the year 77 32 41 (64 ) 5 (43 ) (483 ) (231 ) 135 1 136 185 Total comprehensive income / (loss) 77 32 41 (64 ) 5 (43 ) (483 ) (231 ) 135 1 136 185 Attributed to NCIs 19 8 10 (32 ) 3 (21 ) (204 ) (56 ) 116 1 100 141 Dividends paid to NCIs — — — — — — 80 116 — 76 82 — Summarized statement of financial position Kar-Tel Sky Mobile GTH OTA 2018 2017 2018 2017 2018 2017* 2018 2017 Property and equipment 192 184 76 79 1,652 2,166 498 517 Intangible assets 69 92 10 12 1,042 1,324 214 291 Other non-current assets 177 204 55 131 1,766 2,094 1,178 1,361 Trade and other receivables 13 22 3 6 263 260 48 31 Cash and cash equivalents 29 14 43 32 420 385 53 125 Other current assets 15 74 12 12 317 363 88 66 Financial liabilities — — — — (2,938 ) (3,072 ) (63 ) (128 ) Provisions (4 ) (5 ) (2 ) (4 ) (312 ) (348 ) (25 ) (31 ) Other liabilities (85 ) (84 ) (19 ) (22 ) (1,690 ) (1,865 ) (355 ) (400 ) Total equity 406 501 178 246 520 1,307 1,636 1,832 Attributed to: Equity holders of the parent 178 249 45 79 1,710 2,100 545 597 Non-controlling interests 228 252 133 167 (1,190 ) (793 ) 1,091 1,235 Summarized statement of cash flows Kar-Tel Sky Mobile GTH OTA 2018 2017 2016 2018 2017 2016 2018 2017 2016 2018 2017 2016 Net operating cash flows 148 105 99 29 23 58 900 877 1,077 245 345 446 Net investing cash flows (42 ) (73 ) (124 ) (18 ) (24 ) 45 (695 ) (924 ) (473 ) (118 ) (172 ) (238 ) Net financing cash flows (90 ) (48 ) (83 ) — — (115 ) (110 ) (157 ) (492 ) (193 ) (350 ) (288 ) Effect of exchange rate changes on cash and (3 ) — 1 — — (1 ) (60 ) (18 ) (14 ) (5 ) (7 ) (14 ) Net increase / (decrease) in cash equivalents 13 (16 ) (107 ) 11 (1 ) (13 ) 35 (222 ) 98 (71 ) (184 ) (94 ) SIGNIFICANT ACCOUNTING JUDGEMENT Control over subsidiaries Subsidiaries, which are those entities over which the Company is deemed to have control, are consolidated. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. In certain circumstances, significant judgment is required to assess if the Company is deemed to have control over entities where the Company’s ownership interest does not exceed 50% . |
FINANCIAL ASSETS AND LIABILITIE
FINANCIAL ASSETS AND LIABILITIES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of detailed information about financial instruments [abstract] | |
FINANCIAL ASSETS AND LIABILITIES | FINANCIAL ASSETS AND LIABILITIES Set out below is the carrying value and fair value of the Company’s financial instruments as of December 31 . Details regarding how fair value is determined for each class of financial instruments is disclosed later in this Note. FINANCIAL ASSETS The Company holds the following financial assets as of December 31 : Carrying value Fair value Financial assets 2018 2017 2018 2017 Financial assets at fair value through profit or loss Derivatives not designated as hedges 14 10 14 10 Derivatives designated as net investment hedges 45 — 45 — Investments in debt instruments * 36 71 36 71 Other 3 — 3 — 98 81 98 81 Financial assets at amortized cost Cash pledged as collateral ** 31 998 31 998 Other investments 17 85 17 85 48 1,083 48 1,083 Total financial assets 146 1,164 146 1,164 Non-current 58 34 Current 88 1,130 * Investments in debt instruments relate primarily to government bonds and are measured at fair value through other comprehensive income (with recycling). Balances in the comparative year were classified as Available for sale financial asset, see Note 25 for further details. ** Amount in 2017 relates to the mandatory tender offer in relation to GTH, which was subsequently withdrawn, see Note 10 for further details. FINANCIAL LIABILITIES The Company holds the following financial liabilities as of December 31 : Carrying value Fair value Financial Liabilities 2018 2017 2018 2017 Financial liabilities at fair value through profit or loss Derivatives not designated as hedges 65 — 65 — Derivatives designated as net investment hedges — 59 — 59 Contingent consideration 40 49 40 49 Other 2 1 2 1 107 109 107 109 Financial liabilities at amortized cost Principal amount outstanding 7,298 11,103 7,349 11,548 Interest accrued 81 129 81 130 Discounts, unamortized fees, hedge basis adjustment (13 ) (34 ) — — Bank loans and bonds 7,366 11,198 7,430 11,678 Put-option liability over non-controlling interest 306 310 306 310 Other financial liabilities 77 13 77 13 7,749 11,521 7,813 12,001 Total financial liabilities 7,856 11,630 7,920 12,110 Non-current 6,567 10,362 Current 1,289 1,268 Subsequent to the sale of the Italy Joint Venture, the Company entered into cross-currency interest rate swaps opposite to those originally used for hedging the Euro exposure (arising on the net investment in the joint venture) which resulted in locking-in the valuation of the original instruments. Although the opposite swaps were entered into with original counterparties, the transactions do not meet the criteria for set-off according to IFRS. Bank loans and bonds The Company had the following principal amounts outstanding for interest-bearing loans and bonds at December 31 : Principal amount outstanding Borrower Type of debt Guarantor Currency Interest rate Maturity 2018 2017 VEON Holdings Loans None RUB 8.75% - 10.0% 2022 2,051 2,474 VEON Holdings Notes None US$ 5.2% - 5.95% 2019 -2023 1,100 1,554 VEON Holdings Notes None US$ 3.95% - 4.95% 2021 - 2024 1,133 1,500 VEON Holdings Loans None EUR 3mEURIBOR + 1.9% - 2.75% 2022 — 752 VEON Holdings Notes PJSC VimpelCom US$ 7.5% 2022 417 628 VEON Holdings Syndicated loan (RCF) None US$ 1mLIBOR + 2.25% 2018 — 250 VEON Holdings Notes None RUB 9.0% 2018 — 208 GTH Finance B.V. Notes VEON Holdings B.V. US$ 6.25% - 7.25% 2020 -2023 1,200 1,200 VIP Finance Ireland Eurobonds None US$ 7.748% 2021 262 543 PMCL Loans None PKR 6mKIBOR + 2020 -2022 256 379 PMCL Loans EKN * US$ 6mLIBOR + 2020 137 212 Banglalink Senior Notes None US$ 8.6% 2019 300 300 Banglalink Loans None BDT Average bank deposit rate + 3.0% - 4.25% 2020 - 2022 146 — Other loans 296 1,103 Total bank loans and bonds 7,298 11,103 * Exportkreditnämnden (The Swedish Export Credit Agency) Termination of Guarantees On June 30, 2017, the guarantees issued by VEON Holdings under each of the RUB 12,000 million 9.00% notes due 2018 (the “RUB Notes” ), the US $600 5.20% notes due 2019 (the “2019 Notes” ) and the US $1,000 5.95% notes due 2023 (the “2023 Notes” , and together with the RUB Notes and the 2019 Notes, the “Guaranteed Notes” ), issued by PJSC VimpelCom, were terminated. VEON Holdings exercised its option to terminate the guarantees pursuant to the terms of the trust deeds entered into in respect of the Notes, between VEON Holdings, PJSC VimpelCom and BNY Mellon Corporate Trustee Services Limited, each dated February 13, 2013 (together the “Trust Deeds” ). Reconciliation of cash flows from financing activities Bank loans and bonds at amortized cost 2018 2017 Balance as of January 1 11,198 10,702 Cash flows Proceeds from borrowings, net of fees paid 807 6,193 Repayment of borrowings (4,122 ) (5,948 ) Interest paid (736 ) (834 ) Non-cash movements Interest expense 738 774 Early redemption premium accrued * 44 168 Foreign currency translation (573 ) 138 Other non-cash movements 10 5 Balance as of December 31 7,366 11,198 * Early redemption premium accrued in respect of the settlement of the cash tender offer for certain outstanding debt securities, see below for further information. The amount accrued relates to the excess of purchase price over the principal amount outstanding, which, together with the release of unamortized debt issuance costs and unamortized fair value hedge basis adjustment, resulted in a loss from early debt redemption of US $30 ( 2017 : US $124 ), recorded within “Other non-operating gains/losses” (refer to Note 5). Cash tender offer for certain outstanding bonds and modification of covenants In November 2018, the Company commenced a cash tender offer in respect of (A) any and all of the outstanding (i) US $1,000 7.748% Loan Participation Notes due 2021 issued by, but with limited recourse to, VIP Finance Ireland Limited (the “2021 Notes” ), (ii) US $1,500 7.5043% Guaranteed Notes due 2022 issued by VEON Holdings B.V. (the “2022 Notes” ), (iii) US $1,000 5.95% Notes due 2023 issued by VEON Holdings B.V. (the “2023 Notes” , and together with the 2021 Notes and the 2022 Notes, the “Any and All Notes” ), and (B) up to maximum tender consideration of US $400 of the US $900 4.950% Notes due 2024 issued by VEON Holdings B.V. (the “2024 Notes” , and together with the Any and All Notes, the “Notes” ). The aggregate principal amount of the Notes accepted for repurchase was US $1,147 , which was settled on December 17, 2018 for the 2024 Notes, and on December 31, 2018 for the Any and All Notes. The unamortized debt issuance costs and unamortized fair value hedge basis adjustment were released to the income statement at the date of the closing, which, together with the early redemption premium, resulted in a loss from early debt redemption of US $30 , recorded within “Other non-operating gains/losses” (refer to Note 5). Simultaneously with the tender, the Company requested bondholders’ consent to amend or remove certain covenants contained in the Any and All Notes, including the negative pledge covenant. Supplemental trust deeds and an amendment agreement documenting those changes were executed on December 28, 2018. Issuance of new notes and cash tender offer for certain outstanding debt securities In May 2017, VEON Holdings commenced a cash tender offer in respect of the outstanding (i) US $1,000 9.125% Loan Participation Notes due 2018 issued by, but with limited recourse to, VIP Finance Ireland Limited (the “2018 Notes” ), (ii) the 2021 Notes and (iii) the 2022 Notes (together with the 2018 Notes and the 2021 Notes, the “Existing Notes” ). The aggregate principal amount accepted for repurchase was US $1,259 , which was settled in June 2017. The unamortized debt issuance costs and unamortized fair value hedge basis adjustment were released to the income statement at the date of the closing, which, together with the early redemption premium, resulted in a loss from early debt redemption of US $124 , recorded within “Other non-operating gains/losses” (refer to Note 5). In June 2017, VEON Holdings issued US $600 3.95% Senior Notes due 2021 and US $900 4.95% Senior Notes due 2024 (together, the “New Notes” ). The net proceeds of the New Notes were used to finance the purchase of the Existing Notes and for general corporate purposes. FAIR VALUES The fair value of financial assets and liabilities is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the balance sheet date. The fair values were estimated based on quoted market prices for our bonds, derived from market prices or by discounting contractual cash flows at the rate applicable for the instruments with similar maturity and risk profile. The carrying amount of cash and cash equivalents, trade and other receivables, and trade and other payables approximate their respective fair value. The fair value of derivative financial instruments is determined using the discounted cash flows technique. Observable inputs (Level 2) used in the valuation techniques include LIBOR, EURIBOR, swap curves, basis swap spreads, foreign exchange rates and credit default spreads. Fair value hierarchy As of December 31, 2018 and 2017 , the Group recognized financial instruments at fair value in the statement of financial position. The fair value hierarchy ranks fair value measurements based on the type of inputs used in the valuation; it does not depend on the type of valuation techniques used: • Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities • Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly • Level 3: unobservable inputs are used for the asset or liability As of December 31, 2018 and 2017 , all financial assets or financial liabilities carried at fair value were measured based on Level 2 inputs, except for Contingent consideration, for which fair value is classified as Level 3. Transfers into and out of fair value hierarchy levels are recognized at the end of the reporting period (or the date of the event or change in circumstances that caused the transfer). On a quarterly basis, the Company reviews if there are any indicators for a possible transfer between Level 2 and Level 3. This depends on how the Company is able to obtain the underlying input parameters when assessing the fair valuations. During the years ended December 31, 2018 and 2017 , there were no transfers between Level 1, Level 2 and Level 3 fair value measurements. The following table summarizes the movements relating to financial instruments classified as Level 3 in the fair value hierarchy for the years ended December 31, 2018 and 2017 : Financial assets at fair value Financial liabilities at fair value Investments in debt instruments Contingent consideration As of January 1, 2017 29 47 Impairment loss (20 ) — Change in fair value recognized in other comprehensive income (9 ) — Change in fair value recognized in the income statement — 2 As of December 31, 2017 — 49 Change in fair value recognized in the income statement — (9 ) As of December 31, 2018 — 40 All impairment losses and changes in fair values of financial instruments are unrealized and are recorded in “Other non-operating losses” in the consolidated income statement or “Other” in the consolidated statement of comprehensive income. HEDGE ACCOUNTING The following table sets out the Company’s hedging instruments designated as net investment hedges as of December 31 : Hedging instruments* Designated rate Excluded component Hedged Currency Aggregated designated nominal value of hedged items, million 2018 2017 Cross currency interest rate swaps ** Forward foreign currency basis spread Italy Joint Venture EUR — 537 *** Euro-denominated loans ** Spot n/a Italy Joint Venture EUR — 627 Foreign currency forward contracts Forward foreign currency basis spread PJSC VimpelCom RUB 68,639 **** — * Refer to Note 16 for information regarding the carrying amounts of the hedging instruments. ** Hedging relationships were terminated due to disposal of the hedged item. Refer to Note 10 for further details. *** Exchanged to US $600 at maturity on June 16, 2021. **** Hedging instruments have a weighted average term to maturity of 2 years as of December 31, 2018 . There is economic relationship between the hedged net investments and the hedging instruments because the hedged items create a translation risk that matches the foreign exchange risk of the hedging instruments. The hedge ratio for each of the above relationships was set at 1 :1 as the underlying risk of the hedging instruments is identical to the hedged risk and the nominal value of hedging instruments has not exceeded the amounts of respective net investments. The hedge ineffectiveness might arise from: • the value of a net investment falling below the related designated nominal value of the hedging items, or • counterparties’ credit risk impacting the hedging item (where applicable) but not the hedged net investment. During the periods covered by these consolidated financial statements, the value of ineffectiveness was immaterial for all hedging relationships. Impact of hedge accounting on equity The below table sets out the reconciliation of each component of equity and the analysis of other comprehensive income: Foreign currency translation reserve Cost of hedging reserve As of January 1, 2017 (7,109 ) — Foreign currency revaluation of the foreign operations and other (433 ) — Effective portion of foreign currency revaluation of the hedging instruments * (125 ) — As of December 31, 2017 (7,667 ) — Foreign currency revaluation of the foreign operations (753 ) — Effective portion of foreign currency revaluation of the hedging instruments * 83 — Change in fair value of foreign currency basis spreads — (4 ) Amortization of time-period related foreign currency basis spreads — 5 Net investment hedge amount reclassified to profit or loss – sale of Italy Joint Venture 80 4 Disposal of subsidiaries – reclassification to profit or loss (159 ) — As of December 31, 2018 (8,416 ) 5 * Amounts represent the changes in fair value of the hedging financial instruments and closely approximate the changes in value of the hedged items used to recognize hedge ineffectiveness. OFFSETTING FINANCIAL ASSETS AND LIABILITIES For financial assets and liabilities subject to netting arrangements, each agreement between the Group and the counterparty allows for net settlement of the relevant financial assets and liabilities when both elect to settle on a net basis. In the absence of such an election, financial assets and liabilities are settled on a gross basis. The major arrangements applicable for the Group are agreements with national and international interconnect operators and agreements with roaming partners. Several entities of the Group have entered into International Swaps and Derivatives Association, Inc. ( “ISDA” ) Master Agreements or equivalent documents with their counterparties, governing the derivative transactions entered into between these entities and their counterparties. These documents provide for set-off of outstanding derivative positions in the event of termination if an Event of Default of either entity or the counterparty occurs. Related amounts not set off in the statement of financial position Gross amounts recognized Gross amounts set off in the statement of financial position Net amounts presented in the statement of financial position Financial instruments Cash collateral received Net amount As of December 31, 2018 Other financial assets (non-current) 58 — 58 — — 58 Other financial liabilities (non-current) 6,567 — 6,567 — — 6,567 Other financial assets (current) 88 — 88 — — 88 Other financial liabilities (current) 1,289 — 1,289 — — 1,289 Trade and other receivables 617 (40 ) 577 — — 577 Trade and other payables 1,472 (40 ) 1,432 — — 1,432 As of December 31, 2017 Other financial assets (non-current) 34 — 34 — — 34 Other financial liabilities (non-current) 10,362 — 10,362 — — 10,362 Other financial assets (current) 1,130 — 1,130 — — 1,130 Other financial liabilities (current) 1,268 — 1,268 — — 1,268 Trade and other receivables 817 (72 ) 745 — — 745 Trade and other payables 1,595 (72 ) 1,523 — — 1,523 ACCOUNTING POLICIES Put options over non-controlling interest Put options over non-controlling interest of a subsidiary are accounted for as financial liabilities in the Company’s consolidated financial statements. The put-option redemption liability is measured at the discounted redemption amount. Interest over the put-option redemption liability will accrue in line with the effective interest rate method, until the options have been exercised or are expired. Derivative contracts VEON enters into derivative contracts, including swaps and forward contracts, to manage certain foreign currency and interest rate exposures. Any derivative instruments for which no hedge accounting is applied are recorded at fair value with any fair value changes recognized directly in profit or loss. Although some of the derivatives entered into by the Company have not been designated in hedge accounting relationships, they act as economic hedges and offset the underlying transactions when they occur. Hedges of a net investment The Company applies net investment hedge accounting to mitigate foreign currency translation risk related to the Company’s investments in foreign operations. The portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is recognized in other comprehensive income within the “Foreign currency translation” line item. Where the hedging instrument’s foreign currency retranslation is greater (in absolute terms) than that of the hedged item, the excess amount is recorded in profit or loss as ineffectiveness. The gain or loss on the hedging instrument relating to the effective portion of the hedge that has been recognized in other comprehensive income shall be reclassified from equity to profit or loss as a reclassification adjustment on the disposal or partial disposal of the foreign operation. Cash flows arising from derivative instruments for which hedge accounting is applied are reported in the statement of cash flows within the line item where the underlying cash flows of the hedged item are recorded. SOURCE OF ESTIMATION UNCERTAINTY Fair value of financial instruments Where the fair value of financial assets and financial liabilities recorded in the statement of financial position cannot be derived from active markets, their fair value is determined using valuation techniques, including discounted cash flows model. The inputs to these models are taken from observable markets, but when this is not possible, a degree of judgment is required in establishing fair values. The judgments include considerations regarding inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. |
CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS | 12 Months Ended |
Dec. 31, 2018 | |
Cash and cash equivalents [abstract] | |
CASH AND CASH EQUIVALENTS | CASH AND CASH EQUIVALENTS Cash and cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. Cash and cash equivalents are comprised of cash at bank and on hand and highly liquid investments that are readily convertible to known amounts of cash, are subject to only an insignificant risk of changes in value and have an original maturity of less than three months. Cash and cash equivalents consisted of the following items as of December 31 : December 31, 2018 December 31, 2017 Cash and cash equivalents at banks and on hand 756 850 Cash equivalents with original maturity of less than three months 1,052 464 Cash and cash equivalents 1,808 1,314 Less overdrafts (17 ) — Cash and cash equivalents, net of overdrafts, as presented in the consolidated statement of cash flows 1,791 1,314 Cash at bank earns interest at floating rates based on bank deposit rates. Short-term deposits are made for varying periods of between one day and three months, depending on the immediate cash requirements of the Company, and earn interest at the respective short-term deposit rates. The imposition of currency exchange controls or other similar restrictions on currency convertibility in the countries in which VEON operates could limit VEON’s ability to convert local currencies or repatriate local cash in a timely manner or at all, as well as remit dividends from the respective countries. As of December 31, 2018 , there were no restricted cash and cash equivalent balances ( 2017 : nil ). Cash balances include investments in money market funds of US $349 ( 2017 : US $91 ). As of December 31, 2018 , some bank accounts forming part of a cash pooling program and being an integral part of the Company’s cash management remained overdrawn by US $17 ( 2017 : US$ nil ). Even though the total balance of the cash pool remained positive, the Company has no legally enforceable right of set-off and therefore the overdrawn accounts are presented as financial liabilities within the statement of financial position. At the same time, because the overdrawn accounts are an integral part of the Company’s cash management, they were included as cash and cash equivalents within the statement of cash flows. |
FINANCIAL RISK MANAGEMENT
FINANCIAL RISK MANAGEMENT | 3 Months Ended |
Dec. 31, 2018 | |
Disclosure of risk management strategy related to hedge accounting [abstract] | |
FINANCIAL RISK MANAGEMENT | FINANCIAL RISK MANAGEMENT The Group’s principal financial liabilities consist of loans and borrowings and trade and other payables. The main purpose of these financial liabilities is to finance the Group’s operations. The Group has trade and other receivables, cash and short-term deposits that are derived directly from its operations. The Group is exposed to market risk, credit risk and liquidity risk. The Company’s Board of Directors manages these risks with support of the treasury function, who proposes the appropriate financial risk governance framework for the Group, identifies and measures financial risks and suggests mitigating actions. The Company’s Board of Directors, supported by its Finance Committee, approves the financial risk management framework and oversees its enforcement. MARKET RISK Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises interest rate risk and foreign currency risk. INTEREST RATE RISK Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company’s exposure to the risk of changes in market interest rates relates primarily to the Company’s long-term debt obligations. The Company manages its interest rate risk exposure through a portfolio of fixed and variable rate borrowings and hedging activities. As of December 31, 2018 , after taking into account the effect of interest rate swaps, approximately 91% of the Company’s borrowings are at a fixed rate of interest ( 2017 : 80% ). The Group is exposed to possible changes in interest rates on variable interest loans and borrowings, partially mitigated through related derivative financial instruments, cash and cash equivalents and current deposits. With all other variables held constant, the Company’s profit before tax is affected through changes in the floating rate of borrowings while the Company’s equity is affected through the impact of a parallel shift of the yield curve on the fair value of hedging derivatives. An increase or decrease of 100 basis points in interest rates would have an immaterial impact on the Company’s income statement and other comprehensive income. FOREIGN CURRENCY RISK Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the debt denominated in currencies other than the functional currency of the relevant entity, the Company’s operating activities (predominantly capital expenditures at subsidiary level denominated in a different currency from the subsidiary’s functional currency) and the Company’s net investments in foreign subsidiaries. The Company manages its foreign currency risk by selectively hedging committed exposures. The Company hedges part of its exposure to fluctuations on the translation into U.S. dollars of its foreign operations by holding the borrowings in foreign currencies or by foreign exchange swaps and forwards. During the periods covered by these financial statements, the Company used cross currency interest rate swaps and foreign exchange forwards to mitigate foreign currency translation risk related to the Company’s net investments in the Italy Joint Venture and PJSC VimpelCom. Foreign currency sensitivity The following table demonstrates the sensitivity to a possible change in exchange rates against the US dollar with all other variables held constant. Additional sensitivity changes to the indicated currencies are expected to be approximately proportionate. The table shows the effect on the Company’s profit before tax (due to changes in the value of monetary assets and liabilities, including foreign currency derivatives) and equity (due to application of hedge accounting or existence of quasi equity loans). The Company’s exposure to foreign currency changes for all other currencies is not material. Effect on profit / (loss) before tax Effect on other comprehensive income Change in foreign exchange rate against US$ 10% depreciation 10% appreciation 10% depreciation 10% appreciation 2018 Euro (2) 3 — — Russian Ruble (32) 35 70 (77) Bangladeshi Taka (76) 83 — — Pakistani Rupee (19) 20 — — Georgian Lari (34) 37 — — Other currencies — — — — 2017 Euro (18) 20 132 (145) Russian Ruble 44 (48) — — Bangladeshi Taka (69) 76 — — Pakistani Rupee (27) 30 — — Georgian Lari (32) 35 — — Other currencies (11) 12 — — CREDIT RISK Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily from trade receivables), and from its treasury activities, including deposits with banks and financial institutions, derivative financial instruments and other financial instruments. See Note 17 for further information on restrictions on cash balances. Trade receivables consist of amounts due from customers for airtime usage and amounts due from dealers and customers for equipment sales. VEON’s credit risk arising from the services the Company provides to customers is mitigated to a large extent due to the majority of its active customers being subscribed to a prepaid service as of December 31, 2018 and 2017 , and accordingly not giving rise to credit risk. For postpaid services, in certain circumstances, VEON requires deposits as collateral for airtime usage. Equipment sales are typically paid in advance of delivery, except for equipment sold to dealers on credit terms. VEON’s credit risk arising from its trade receivables from dealers is mitigated due to the risk being spread across a large number of dealers. Management periodically reviews the history of payments and credit worthiness of the dealers. The Company also has receivables from other local and international operators from interconnect and roaming services provided to their customers, as well as receivables from customers using fixed-line services, such as business services, wholesale services and services to residents. Receivables from other operators for roaming services are settled through clearing houses, which helps to mitigate credit risk in this regard. VEON holds available cash in bank accounts, as well as other financial assets with financial institutions in countries where it operates. To manage credit risk associated with such asset holdings, VEON allocates its available cash to a variety of local banks and local affiliates of international banks within the limits set forth by its treasury policy. Management periodically reviews the creditworthiness of the banks with which it holds assets. In respect of financial instruments used by the Company’s treasury function, the aggregate credit risk the Group may have with one counterparty is managed by reference to, amongst others, the long-term credit ratings assigned for that counterparty by Moody’s, Fitch Ratings and Standard & Poor’s and CDS spreads of that counterparty. Counterparty credit limits are reviewed and approved by the Company’s CFO. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through potential counterparty’s failure. Value Added Tax ( “VAT” ) is recoverable from tax authorities by offsetting it against VAT payable to the tax authorities on VEON’s revenue or direct cash receipts from the tax authorities. Management periodically reviews the recoverability of the balance of input value added tax and believes it is fully recoverable. VEON issues advances to a variety of its vendors of property and equipment for its network development. The contractual arrangements with the most significant vendors provide for equipment financing in respect of certain deliveries of equipment. VEON periodically reviews the financial position of vendors and their compliance with the contract terms. The Company’s maximum exposure to credit risk for the components of the statement of financial position at December 31, 2018 and 2017 is the carrying amount as illustrated in Note 7, Note 16 and Note 17. LIQUIDITY RISK The Company monitors its risk to a shortage of funds using a recurring liquidity planning tool. The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts, bank loans, debentures, preference shares and lease arrangements. The Company’s policy is to create a balanced debt maturity profile. As of December 31, 2018 , 17% of the Company’s debt ( 2017 : 10% ) will mature in less than one year based on the carrying value of bank loans, bonds and other borrowings reflected in the financial statements. The Company assessed the concentration of risk with respect to refinancing its debt and concluded it to be low based on liquidity in the markets the Company has access to, and recent history of refinancing. The Company believes that access to sources of funding is sufficiently available and the Company’s policy is to diversify the funding sources where possible. Available facilities The Company had the following available facilities as of balance sheet date for the years indicated below: Amounts in millions of transactional currency US$ equivalent amounts Final availability period Facility amount Utilized Available Facility amount Utilized Available 2018 VEON Holdings B.V. – Revolving Credit Facility Feb 2022 US$1,688* — US$1,688 1,688 — 1,688 Pakistan Mobile Communications Limited - Syndicated Term Loan Facility Jun 2019 PKR 26,750 PKR 17,000 PKR 9,750 191 122 69 Pakistan Mobile Communications Limited - Term Loan Facility Jun 2019 PKR 10,000 PKR 5,463 PKR 4,537 72 39 33 * Facility amount of US $1,688 is available until February 2020. Subsequently a reduced facility amount of US $1,586 is available until February 2021 and further reduced facility amount of US $1,382 is available until February 2022 Amounts in millions of transactional currency US$ equivalent amounts Final availability period Facility amount Utilized Available Facility amount Utilized Available 2017 VEON Holdings B.V. – Revolving Credit Facility * Feb 2021 US$1,688 US$250 US$1,438 1,688 250 1,438 VEON Holdings B.V. – Term Loan Facility May 2018 RUB 45,000 RUB 30,000 RUB 15,000 781 520 261 Banglalink Digital Communications Ltd. – Syndicated Term Loan Facility Sep 2018 BDT 29,300 — BDT 29,300 353 — 353 Pakistan Mobile Communications Limited - Syndicated Term Loan Facility Jun 2018 PKR 26,750 PKR 17,000 PKR 9,750 242 154 88 Pakistan Mobile Communications Limited - Term Loan Facility Jun 2018 PKR 10,000 PKR 5,000 PKR 5,000 90 45 45 * Facility amount of US $1,688 is available until February 2020. Subsequently a reduced facility amount of US $1,586 is available until February 2021. Maturity profile The table below summarizes the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments. Payments related to variable interest rate financial liabilities and derivatives are included based on the interest rates and foreign currency exchange rates applicable as of December 31, 2018 and 2017 , respectively. The total amounts in the table differ from the carrying amounts as stated in Note 16 as the below table includes both undiscounted principal amounts and interest while the carrying amounts are measured using the effective interest rate method. Less than 1 year 1-3 years 3-5 years More than 5 years Total At December 31, 2018 Bank loans and bonds 1,697 3,866 2,642 579 8,784 Derivative financial liabilities Gross cash inflows (368 ) (54 ) — — (422 ) Gross cash outflows 394 68 — — 462 Trade and other payables 1,425 — — — 1,425 Other financial liabilities — 62 — — 62 Warid non-controlling interest put option liability — 306 — — 306 Total financial liabilities 3,148 4,248 2,642 579 10,617 Related derivatives financial assets Gross cash inflows (300 ) (610 ) (330 ) — (1,240 ) Gross cash outflows 286 634 354 — 1,274 Related derivative financial assets (14 ) 24 24 — 34 Total financial liabilities, net of derivative assets 3,134 4,272 2,666 579 10,651 Less than 1 year 1-3 years 3-5 years More than 5 years Total At December 31, 2017 Bank loans and bonds 1,862 4,141 4,958 2,774 13,735 Derivative financial liabilities Gross cash inflows (37 ) (49 ) (12 ) — (98 ) Gross cash outflows 29 27 51 — 107 Trade and other payables 1,523 — — — 1,523 Other financial liabilities — 62 — — 62 Warid non-controlling interest put option liability — 310 — — 310 Total financial liabilities 3,377 4,491 4,997 2,774 15,639 Related derivatives financial assets Gross cash inflows (275 ) — — — (275 ) Gross cash outflows 270 — — — 270 Related derivative financial assets (5 ) — — — (5 ) Total financial liabilities, net of derivative assets 3,372 4,491 4,997 2,774 15,634 CAPITAL MANAGEMENT The primary objective of the Company’s capital management is to ensure that it maintains healthy capital ratios, so as to secure access to debt and capital markets at all times and maximize shareholder value. The Company manages its capital structure and makes adjustments to it in light of changes in economic conditions. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. Current credit ratings of the Company support its capital structure objectives. There were no changes made in the Company’s objectives, policies or processes for managing capital during 2018 . VEON is committed to paying a sustainable and progressive dividend. A continuation of this progressive dividend policy is dependent on the evolution of the Group’s equity free cash flow, including development of the U.S. dollar exchange rate against the Company's functional currencies. The Net Debt to Adjusted EBITDA ratio is an important measure used by the Company to assess its capital structure. Net Debt represents the principal amount of interest-bearing debt less cash and cash equivalents and bank deposits. Adjusted EBITDA is defined as last twelve months earnings before interest, tax, depreciation, amortization and impairment, loss on disposals of non-current assets, other non-operating losses and share of profit / (loss) of joint ventures. For reconciliation of Adjusted EBITDA to Profit / (loss) before tax, refer to Note 2. Further, this ratio is included as a financial covenant in the credit facilities of the Company. For most of our credit facilities the Net Debt to Adjusted EBITDA ratio is calculated at consolidated level of VEON Ltd. and is “pro-forma” adjusted for acquisitions and divestments of any business bought or sold during the relevant period. Under these credit facilities, the Company is required to maintain the Net Debt to Adjusted EBITDA ratio below 3.5 x. The Company has not breached any financial covenants during the periods ended. |
ISSUED CAPITAL AND RESERVES
ISSUED CAPITAL AND RESERVES | 12 Months Ended |
Dec. 31, 2018 | |
ISSUED CAPITAL AND RESERVES | |
ISSUED CAPITAL AND RESERVES | 19 ISSUED CAPITAL AND RESERVES The following table details the common shares of the Company as of December 31 : 2018 2017 Authorized common shares (nominal value of US$0.001 per share) 1,849,190,670 2,759,171,830 Issued shares 1,756,731,135 1,756,731,135 Treasury shares (7,603,731 ) (7,603,731 ) Outstanding shares 1,749,127,404 1,749,127,404 On July 30, 2018, the Annual General Meeting approved to cancel 909,981,160 of authorized unissued common shares with par value USD 0.001 . Following the cancellation, the authorized share capital of the Company has become US $1,849,190.67 divided into 1,849,190,670 common shares of par value USD 0.001 each, of which 1,756,731,135 are common shares in issue and fully paid. The rights of holders of issued shares are unaffected by the proposed reduction of authorized share capital. The holders of common shares are, subject to our by-laws and Bermuda law, generally entitled to enjoy all the rights attaching to common shares. As of December 31, 2018 , the Company’s largest shareholders and remaining free float are as follows: Shareholder Common shares % of common and voting shares L1T VIP Holdings S.à r.l. (“ LetterOne ”) 840,625,001 47.9 % Telenor East Holding II AS (“ Telenor ”) 256,703,840 14.6 % Stichting Administratiekantoor Mobile Telecommunications Investor * 145,947,562 8.3 % Free Float 513,454,732 29.6 % Shares held by the Company or its subsidiaries ( “Treasury shares” ) (7,603,731 ) (0.40 )% Total outstanding common shares 1,749,127,404 100 % * LetterOne is the holder of the depositary receipts issued by Stichting and is therefore entitled to the economic benefits (dividend payments, other distributions and sale proceeds) of such depositary receipts and, indirectly, of the 145,947,562 common shares represented by the depositary receipts. According to the conditions of administration entered into between Stichting and LetterOne ( “Conditions of Administration” ) in connection with the transfer of 145,947,562 ADSs from LetterOne to Stichting on March 29, 2016, Stichting has the power to vote and direct the voting of, and the power to dispose and direct the disposition of, the ADSs, in its sole discretion, in accordance with the Conditions of Administration and Stichting’s articles of association. Nature and purpose of reserves Other capital reserves are mainly used to recognize the results of transactions that do not result in a change of control with non-controlling interest (see Note 15). The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign subsidiaries, net of any related hedging activities (see Note 16). |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2018 | |
Earnings per share [abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Earnings per common share for all periods presented has been determined by dividing profit available to common shareholders by the weighted average number of common shares outstanding during the period. The following table sets forth the computation of basic and diluted earnings per share ( “EPS” ) for continuing operations, for the years ended December 31 : Continuing operations 2018 2017 2016 (In millions of U.S. dollars, except share and per share amounts) Numerator: Profit / (loss) for the period attributable to the owners of the parent (397 ) (115 ) (439 ) Denominator: Weighted average common shares outstanding for basic earnings per share (in millions) 1,749 1,749 1,749 Denominator for diluted earnings per share (in millions) 1,749 1,749 1,749 Basic (loss) / earnings per share ($0.23 ) ($0.07 ) ($0.25 ) Diluted (loss) / earnings per share ($0.23 ) ($0.07 ) ($0.25 ) The following table sets forth the computation of basic and diluted earnings per share ( “EPS” ) for discontinued operations, for the years ended December 31 : Discontinued operations 2018 2017 2016 (In millions of U.S. dollars, except share and per share amounts) Numerator: Profit / (loss) for the period attributable to the owners of the parent 979 (390 ) 2,767 Denominator: Weighted average common shares outstanding for basic earnings per share (in millions) 1,749 1,749 1,749 Denominator for diluted earnings per share (in millions) 1,749 1,749 1,749 Basic (loss) / earnings per share $0.56 ($0.22 ) $1.58 Diluted (loss) / earnings per share $0.56 ($0.22 ) $1.58 |
DIVIDENDS PAID AND PROPOSED
DIVIDENDS PAID AND PROPOSED | 12 Months Ended |
Dec. 31, 2018 | |
DIVIDENDS PAID AND PROPOSED | |
DIVIDENDS PAID AND PROPOSED | DIVIDENDS PAID AND PROPOSED Pursuant to Bermuda law, VEON is restricted from declaring or paying a dividend if there are reasonable grounds for believing that (a) VEON is, or would after the payment be, unable to pay its liabilities as they become due, or (b) the realizable value of VEON assets would, as a result of the dividend, be less than the aggregate of VEON liabilities. Following table provides an overview of the dividends announced by VEON for years 2018 and 2017 : Description Dividends declared Payment date Dividends, US$ cents per share Final for 2018 February 25, 2019 Expected March 20, 2019 17 Interim for 2018 August 2, 2018 August 20, 2018 12 Final for 2017 February 22, 2018 March 13, 2018 17 Interim for 2017 August 3, 2017 September 6, 2017 11 The Company make appropriate tax withholdings of up to 15% when the dividends are being paid to the Company’s share depositary, The Bank of New York Mellon. DIVIDENDS DECLARED TO NON-CONTROLLING INTERESTS During the 2018 and 2017 years, certain subsidiaries of the Company declared dividends, of which a portion was paid or payable to non-controlling interests. Name of subsidiary Dividend declared Dividend paid Paid or payable to non-controlling interests Omnium Telecom Algeria S.p.A June 21, 2018 August 29, 2018 76 TNS Plus LLP April 19, 2018 August 29, 2018 2 Rascom CJSC June 27, 2018 July 24, 2018 2 TNS Plus LLP April 19, 2018 April 23, 2018 11 VIP Kazakhstan Holding AG October 6, 2017 October 10, 2017 11 Omnium Telecom Algeria S.p.A June 21, 2017 August 18, 2017 82 TNS Plus LLP May 12, 2017 May 15, 2017 12 VIP Kyrgyzstan Holding AG February 13, 2017 February 16, 2017 55 TNS Plus LLP January 24, 2017 January 25, 2017 7 In 2018 , PMCL, a subsidiary of the Company, declared dividends to its shareholders, of which US $11 ( 2017 : US $54 ) was declared to the non-controlling interest holders of PMCL. Dividends declared to non-controlling interests reduces the principal amount of the put-option liability over non-controlling interest on the date of declaration. As of December 31, 2018 , an amount of US $7 ( 2017 : US $26 ) remained payable to non-controlling interests. |
RELATED PARTIES
RELATED PARTIES | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of transactions between related parties [abstract] | |
RELATED PARTIES | RELATED PARTIES As of December 31, 2018 , the Company has no ultimate controlling shareholder. See also Note 19 for details regarding ownership structure. Since December 8, 2017, VEON does not consider Telenor group to be related party. The transactions with Telenor include roaming operations between our operating companies and Telenor and its affiliates. VEON was a party to a General Services Agreement with LetterOne Corporate Advisor Limited, dated December 1, 2010, under which LetterOne Corporate Advisor Limited renders to VEON and its affiliates services related to telecommunication operations. On December 12, 2017 VEON received a notice confirming termination of the agreement. As a result of the completion of the sale transaction of the 50% stake in the Italy Joint Venture and the transaction to unwind the retail joint venture, Euroset Holding N.V., VEON Group is no longer considering these entities to be a related party to the Group (see Note 10). COMPENSATION TO DIRECTORS AND SENIOR MANAGERS OF THE COMPANY The following table sets forth the total compensation paid to our directors and senior managers: 2018 2017 2016 Short-term employee benefits 33 42 37 Long-term employee benefits — 1 — Share-based payments — 1 — Termination benefits 2 1 4 Total compensation to directors and senior management * 35 45 41 *The number of directors and senior managers vary from year to year. Amounts disclosed in previous years for ‘Long-term employee benefits’ represented total nominal values of the grants covering multiple years. Under the Company’s bye-laws, the Board of Directors of the Company established a Compensation Committee, which has the overall responsibility for approving and evaluating the compensation and benefit plans, policies and programs of the Company’s directors, officers and employees and for supervising the administration of the Company’s equity incentive plans and other compensation and incentive programs. Compensation of Key Senior Managers The following table sets forth the total compensation paid to the key senior managers in 2018 and 2017 (gross amounts in whole euro and whole US$ equivalents): Ursula Burns Jean-Yves Charlier Trond Westlie Andrew Davies Kjell Johnsen Scott Dresser Group CEO and Chairman (iii) Former Group CEO (iv) Group CFO (v) Former Group CFO (v) Group COO Group General Counsel EUR US$ EUR US$ EUR US$ EUR US$ EUR US$ EUR US$ 2018 Short-term employee benefits Base salary (i) 4,602,902 5,429,871 1,902,600 2,244,426 1,500,000 1,769,494 — — 1,425,000 1,681,019 1,233,333 1,454,917 Annual incentive (ii) — — 7,717,900 9,104,518 127,313 150,186 — — — — 405,899 478,824 Other 104,645 123,446 489,070 576,938 21,695 25,593 — — 70,442 83,098 927,489 1,094,124 Long-term employee benefits — — — — — — — — — — — — Share-based payments — — — — — — — — — — — — Termination benefits — — 1,340,278 1,581,076 — — — — — — — — Total gross remuneration 4,707,547 5,553,317 11,449,848 13,506,958 1,649,008 1,945,273 — — 1,495,442 1,764,117 2,566,721 3,027,865 2017 Short-term employee benefits Base salary (i) — — 2,500,000 2,819,125 375,000 422,869 1,125,000 1,268,606 — — 925,000 1,043,076 Annual incentive (ii) — — 4,125,000 4,651,556 — — 3,518,295 3,967,405 — — 977,272 1,102,021 Other — — 91,916 103,649 5,400 6,089 1,284,248 1,448,182 — — 31,186 35,166 Long-term employee benefits — — — — — — — — — — — — Share-based payments — — 709,661 800,249 — — — — — — — — Termination benefits — — — — — — 250,000 281,912 — — — — Total gross remuneration — — 7,426,577 8,374,579 380,400 428,958 6,177,543 6,966,105 — — 1,933,458 2,180,263 (i) Base salary includes holiday and/or pension allowances pursuant to the terms of an individual’s employment agreement. (ii) Annual Incentive includes amounts paid under the short-term incentive in respect of performance during the previous year, except for amounts shown for Jean-Yves Charlier during 2018, which also Andrew Davies during 2017, which also includes amounts paid under the STI Scheme in respect of performance during the current year. (iii) Includes total compensation paid to Ursula Burns in respect of her roles as Chairman of the VEON Ltd. board of directors through March 26, 2018, Executive Chairman and Chairman of the VEON Ltd. board of directors from March 27, 2018 to December 11, 2018, and as newly appointed Group CEO and Chairman of the VEON Ltd. board of directors from December 12, 2018. (iv) Jean-Yves Charlier stepped down from the role of Group CEO on March 27, 2018. (v) Andrew Davies stepped down from the role of Group CFO, and Trond Westlie commenced duties as newly appointed Group CFO on November 9, 2017. Compensation of Board of Directors The following table sets forth the total compensation paid to the members of the Board of Directors members in 2018 and 2017 (gross amounts in whole euro and whole US$ equivalents): Retainer Committees Other compensation Total 2018 2017 2018 2017 2018 2017 2018 2017 Guillaume Bacuvier In whole euro 105,000 — 21,000 — — — 126,000 — US$ equivalent 123,869 — 24,774 — — — 148,643 — Osama Bedier In whole euro 105,000 — 10,500 — — — 115,500 — US$ equivalent 123,869 — 12,387 — — — 136,256 — Ursula Burns In whole euro * — 436,213 — 12,500 — 1,517,500 — 1,966,213 US$ equivalent * — 491,896 — 14,096 — 1,711,209 — 2,217,201 Stan Chudnovsky In whole euros 145,833 193,918 — — — — 145,833 193,918 US$ equivalent 172,039 218,672 — — — — 172,039 218,672 Mikhail Fridman In whole euro 40,000 40,000 — — — — 40,000 40,000 US$ equivalent 47,188 45,106 — — — — 47,188 45,106 Gennady Gazin In whole euro 250,000 194,048 65,500 55,000 — 4,757 315,500 253,805 US$ equivalent 294,925 218,818 77,270 62,021 — 5,364 372,195 286,203 Andrei Gusev In whole euro 40,000 40,000 — — — — 40,000 40,000 US$ equivalent 47,188 45,106 — — — — 47,188 45,106 Gunnar Holt In whole euro 250,000 133,950 50,000 20,833 — — 300,000 154,783 US$ equivalent 294,925 151,049 58,985 23,492 — — 353,910 174,541 Sir Julian Horn-Smith In whole euro 250,000 194,048 10,500 — — 5,145 260,500 199,193 US$ equivalent 294,925 218,818 12,387 — — 5,802 307,312 224,620 Nils Katla In whole euro — 36,666 — — — — — 36,666 US$ equivalent — 41,346 — — — — — 41,346 Jørn P. Jensen In whole euro 163,333 195,538 — 30,000 — — 163,333 225,538 US$ equivalent 192,684 220,498 — 33,829 — — 192,684 254,327 Robert Jan van de Kraats In whole euro 105,000 — 12,600 — — — 117,600 — US$ equivalent 123,869 — 14,864 — — — 138,733 — Guy Laurence In whole euro 250,000 110,619 41,600 20,833 16,250 1,250 307,850 132,702 US$ equivalent 294,925 124,740 49,076 23,492 19,170 1,410 363,171 149,642 Alexander Pertsovsky In whole euro 40,000 — — — — — 40,000 — US$ equivalent 47,188 — — — — — 47,188 — Alexey M. Reznikovich In whole euro — 40,000 — — — — — 40,000 US$ equivalent — 45,106 — — — — — 45,106 Total (in whole euro) 1,744,166 1,615,000 211,700 139,166 16,250 1,528,652 1,972,116 3,282,818 Total (US$ equivalent) 2,057,594 1,821,155 249,743 156,930 19,170 1,723,785 2,326,507 3,701,870 * Ursula Burns was appointed Group CEO and Chairman of the VEON Ltd. board of directors on December 12, 2018. Accordingly, her total compensation for 2018 has been included in the section “Compensation of Key Senior Managers” above. Members of our Board of Directors are eligible to participate in a value growth cash-based long-term incentive plan discussed below. Value growth cash-based long-term incentive plan To stimulate and reward leadership efforts that result in sustainable success, the value growth cash-based long-term incentive plan (the “LTI Plan” ) has been designed for members of our recognized leadership community. The participants in the LTI Plan may receive cash payouts after the end of each relevant award performance period. The vesting of each award is subject to continued employment (except in limited “good leaver” circumstances) of a specific Qualifying Period. For participants joining after the start, or leaving before the end of a Qualifying Period, vested awards will be subject to pro-rata reduction in accordance with the actual period of employment during this Qualifying Period. Awards may vest early upon the occurrence of certain corporate events relating to VEON Ltd., subject to the Compensation Committee’s determination of the attainment of Key Performance Indicators ( “KPIs” ) at the time of the relevant event and a potential pro-rata reduction to reflect the early vesting. As of December 31, 2018 , the total target amount (all unvested) granted for awards launched under the LTI Plan was equal to US $107 ( 2017 : US $127 ). The carrying value of obligations under the LTI Plan as of December 31, 2018 , was equal to US $35 ( 2017 : US $58 ). Included within ‘Selling, general and administrative expenses’ for 2018 is a gain of US $18 ( 2017 : expense of US $43 ) relating to share-based payments under the LTI Plan. The awards launched under the LTI Plan are detailed below. Tranche Grant date Performance period KPIs based on Other information 2015 Tranche March 2016 January 1, 2015 to June 30, 2018 (42 months) TSR evolution compared to peer companies in the markets in which VEON operates The Compensation Committee regularly reviews the peer group to ensure that its composition is still appropriate. 2016 Tranche October 2017 January 1, 2016 to June 30, 2019 (42 months) TSR evolution compared to peer companies in the markets in which VEON operates The Compensation Committee regularly reviews the peer group to ensure that its composition is still appropriate. 2017 Tranche October 2017 January 1, 2017 to June 30, 2020 (42 months) Absolute share price performance target KPIs designed to create a direct link between management focus and real return to shareholders. 2018 Tranche July 2018 July 1, 2017 to December 31, 2020 (42 months) Absolute share price performance target KPIs designed to create a direct link between management focus and real return to shareholders. Short Term Incentive Scheme The Company’s Short Term Incentive ( “STI” ) Scheme provides cash pay-outs to participating employees based on the achievement of established KPIs over the period of one calendar year. KPIs are set every year at the beginning of the year and evaluated in the first quarter of the next year. The KPIs are partially based on the financial and operational results (such as EBITDA and total operating revenue) of the Company, or the affiliated entity employing the employee, and partially based on individual targets that are agreed upon with the participant at the start of the performance period based on his or her specific role and activities. The weight of each KPI is decided on an individual basis. Pay-out of the STI award is scheduled in March of the year following the assessment year and is subject to continued active employment during the year of assessment (except in limited “good leaver” circumstances in which case there is a pro-rata reduction) and is also subject to a pro-rata reduction if the participant commenced employment after the start of the year of assessment. Pay-out of the STI award is dependent upon final approval by the Compensation Committee. |
EVENTS AFTER THE REPORTING PERI
EVENTS AFTER THE REPORTING PERIOD | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of non-adjusting events after reporting period [abstract] | |
EVENTS AFTER THE REPORTING PERIOD | EVENTS AFTER THE REPORTING PERIOD Final 2018 Dividend of US 17 cents per share approved by Board of Directors On February 25, 2019, the Company announced that the VEON’s Board of Directors approved a final dividend of US 17 cents per share, bringing total 2018 dividends to US 29 cents per share, in line with the Group’s progressive dividend policy. The record date for the Company’s shareholders entitled to receive the final dividend payment has been set for March 8, 2019. It is expected that the final dividend will be paid on March 20, 2019. The Company will make appropriate tax withholdings of up to 15% when the dividend is paid to the Company’s share depositary, The Bank of New York Mellon. For ordinary shareholders via Euronext Amsterdam, the final dividend of US 17 cents will be paid in euro. Revised technology infrastructure partnership with Ericsson On February 25, 2019, the Company announced a revised arrangement with Ericsson to upgrade its core IT systems in several countries in the coming years and to release Ericsson from the development and delivery of the Full Stack Revenue Manager Solution. This revised arrangement enables VEON to continue upgrading IT infrastructure with new digital business support systems (DBSS) using existing software from Ericsson which is already deployed in certain operating companies within VEON. The parties have signed binding terms to vary the existing agreements and as a result VEON will receive US $350 during the first half of 2019. Mandatory tender offer application in relation to Global Telecom Holding S.A.E. On February 10, 2019, VEON submitted an application to the Egyptian Financial Regulatory Authority (the “ FRA ”) to approve a mandatory tender offer (“ MTO ”) by VEON Holdings B.V. for any and all of the outstanding shares of GTH which are not owned by VEON (up to 1,997,639,608 shares, representing approximately 42.31% of GTH’s issued shares). The MTO will be funded by cash on hand and/or the utilization of undrawn credit facilities. The proposed offer price under the MTO is EGP 5.30 per share. The MTO is currently being reviewed by the FRA and will commence when FRA approval is granted. Any increase of the Company’s interest in GTH will be accounted for directly in equity upon closing of the transaction. |
BASIS OF PREPARATION OF THE CON
BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS | 12 Months Ended |
Dec. 31, 2018 | |
BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS | |
BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS | BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS BASIS OF PREPARATION These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ( “IFRS” ) as issued by the International Accounting Standards Board, effective at the time of preparing the consolidated financial statements and applied by VEON. The consolidated income statement has been presented based on the nature of the expense, other than ‘Selling, general and administrative expenses’, which has been presented based on the function of the expense. The consolidated financial statements have been prepared on a historical cost basis, unless otherwise disclosed. Certain comparative amounts have been reclassified to conform to the current period presentation. BASIS OF CONSOLIDATION The consolidated financial statements comprise the financial statements of the Company and its subsidiaries. Subsidiaries are all entities (including structured entities) over which the Company has control. Please refer to Note 15 for a list of significant subsidiaries. Intercompany transactions, balances and unrealized gains or losses on transactions between Group companies are eliminated. When necessary, amounts reported by subsidiaries have been adjusted to conform with the Group’s accounting policies. When the Group ceases to consolidate a subsidiary due to loss of control, the related subsidiary’s assets (including goodwill), liabilities, non-controlling interest and other components of equity are de-recognized. This may mean that amounts previously recognized in other comprehensive income are reclassified to profit or loss. Any consideration received is recognized at fair value, and any investment retained is re-measured to its fair value, and this fair value becomes the initial carrying amount for the purposes of subsequently accounting for the retained interest. Any resultant gain or loss is recognized in the income statement. FOREIGN CURRENCY TRANSLATION The consolidated financial statements of the Group are presented in U.S. dollars. Each entity in the Group determines its own functional currency and amounts included in the financial statements of each entity are measured using that functional currency. Upon consolidation, the assets and liabilities measured in the functional currency are translated into U.S. dollars at exchange rates prevailing on the balance sheet date; whereas revenue, expenses, gains and losses are translated into U.S. dollars at historical exchange rates prevailing on the transaction dates. Foreign currency translation adjustments resulting from the process of translating financial statements into U.S. dollars are reported in other comprehensive income and accumulated within a separate component of equity. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE | 12 Months Ended |
Dec. 31, 2018 | |
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE | |
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE | SIGNIFICANT ACCOUNTING POLICIES SIGNIFICANT ACCOUNTING JUDGMENTS, ESTIMATES AND ASSUMPTIONS The preparation of these consolidated financial statements has required management to apply accounting policies and methodologies based on complex and subjective judgments, as well as estimates based on past experience and assumptions determined to be reasonable and realistic based on the related circumstances. The use of these judgements, estimates and assumptions affects the amounts reported in these consolidated financial statements. The final amounts for items for which estimates and assumptions were made in the consolidated financial statements may differ from those reported in these statements due to the uncertainties that characterize the assumptions and conditions on which the estimates are based. The sources of uncertainty identified by the Group are described together with the applicable Note, as follows: Significant accounting judgement / source of estimation uncertainty Described in Revenue recognition Note 3 Deferred tax assets and uncertain tax positions Note 8 and Note 9 Provisions Note 8 Impairment of non-current assets Note 11 Control over subsidiaries Note 15 Depreciation and amortization of non-current assets Note 12 and Note 13 Fair value of financial instruments Note 16 CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES Accounting policies are included as relevant in the Notes to these consolidated financial statements. A number of new or amended standards became effective as of January 1, 2018. As a result, the Company has amended its accounting policies accordingly. The following table presents the transitional impact that adoption of IFRS 9, ‘ Financial Instruments ’ ( “IFRS 9 ”) and IFRS 15, ‘Revenue from contracts with customers’ ( “IFRS 15” ) had on the opening balance sheet of the Group, as of January 1, 2018. Further details regarding the impact of IFRS 9 and IFRS 15 can be found below. December 31, 2017* Impact of IFRS 9 Impact of IFRS 15 Classification and measurement Impairment Revenue and customer acquisition costs January 1, 2018 Assets Non-current assets Investments in joint ventures and associates 1,921 (25 ) (10 ) 38 1,924 Deferred tax assets 336 — 2 (12 ) 326 Other financial assets Available for sale 18 (18 ) — — — Fair value through other comprehensive income — 18 — — 18 Other assets 263 — — 93 356 Current assets Trade and other receivables Trade and other receivables, gross 924 — — — 924 Allowance for doubtful debt (169 ) — (14 ) (183 ) Other financial assets Available for sale 53 (53 ) — — — Fair value through profit or loss 20 20 Fair value through other comprehensive income — 33 — — 33 Other assets 418 — — (4 ) 414 Equity Equity attributable to equity owners of the parent 4,331 (25 ) (16 ) 87 4,377 Non-controlling interests (441 ) — (4 ) 15 (430 ) Liabilities Other liabilities (current) 1,353 — — (1 ) 1,352 Deferred tax liabilities 376 — (2 ) 14 388 * Opening balance sheet numbers are represented following retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (Note 10) IFRS 15 ‘Revenue from contracts with customers’ IFRS 15 replaces IAS 18 ‘Revenue’ and IAS 11 ‘Construction contracts’ and related interpretations. IFRS 15 addresses revenue recognition for contracts with customers as well as treatment of incremental costs incurred to obtain a contract with a customer, described in more detail below. Revenue recognition Due to the nature of the Group’s existing product offerings (i.e. prevailing pre-paid service offerings), as well as the Group’s accounting policies applied prior to January 1, 2018, the impact of IFRS 15 on revenue recognition by the Group was immaterial, as shown in the table presented earlier in this Note. Costs of obtaining a contract with customer Under IFRS 15, certain incremental costs incurred in acquiring a contract with a customer ( “customer acquisition costs” ), which previously did not qualify for recognition as an asset under any of the other accounting standards, are deferred in the consolidated statement of financial position. The impact of capitalizing customer acquisition costs upon implementation of IFRS 15 is shown in the table earlier in this Note. Transition The standard is effective for annual periods beginning on or after January 1, 2018. The Group has adopted the standard using the modified retrospective approach, which means that the cumulative impact of the adoption has been recognized in retained earnings as of January 1, 2018 and that comparatives have not been restated. The impact that adoption of IFRS 15 has had on the opening balance sheet of the Group, as of January 1, 2018, is shown in the table presented earlier in this Note. The impact that adoption of IFRS 15 has had on the Group’s profit / (loss) for 2018, if compared to accounting policies that were applied in previous years, was immaterial. IFRS 9 ‘Financial instruments’ IFRS 9 replaces IAS 39 ‘ Financial instruments: Recognition and Measurement ’ (“ IAS 39 ”). IFRS 9 impacts the Group’s classification and measurement of financial instruments, impairment of financial assets and hedge accounting, described in more detail below. Classification and measurement The new standard requires the Company to assess the classification of financial assets on its balance sheets in accordance with the cash flow characteristics of the financial assets and the relevant business model that the Company has for a specific class of financial assets. IFRS 9 no longer has an “Available-for-sale” classification for financial assets. The new standard has different requirements for debt or equity financial assets. Debt instruments should be classified and measured either at: • Amortized cost, where the effective interest rate method will apply; • Fair value through other comprehensive income, with subsequent recycling to the income statement upon disposal of the financial asset; or • Fair value through profit or loss. Investments in equity instruments, other than those to which consolidation or equity accounting apply, should be classified and measured either at: • Fair value through other comprehensive income, with no subsequent recycling to the income statement upon disposal of the financial asset; or • Fair value through profit or loss. The Company continues to initially measure financial assets at its fair value plus transaction cost upon initial recognition, except for financial assets measured at fair value through profit and loss, consistent with current practices. The classification for the majority of financial assets has not been impacted by the transition to IFRS 9 on January 1, 2018. The reclassifications upon transition to IFRS 9 are shown in the table presented earlier in this Note. Impairment (allowance for doubtful debt) IFRS 9 introduces the Expected Credit Loss model, which replaces the incurred loss model of IAS 39 whereby an allowance for doubtful debt was required only in circumstances where a loss event has occurred. By contrast, the Expected Credit Loss model requires the Company to recognize an allowance for doubtful debt on all financial assets carried at amortized cost (including, for example, ‘Trade receivables’), as well as debt instruments classified as financial assets carried at fair value through other comprehensive income (for example, government bonds held for liquidity purposes), since initial recognition, irrespective whether a loss event has occurred. As a result, the allowance for doubtful debt of the Company has increased upon implementation of IFRS 9 on January 1, 2018. The impact of applying the Expected Credit Loss model is shown in the table earlier in this Note. Hedge Accounting IFRS 9 allows for more possibilities for the Company to apply hedge accounting (for example, risk components of non-financial assets or liabilities may be designated as part of a hedging relationship). In addition, the requirements of the standard have been more closely aligned with the Company’s risk management policies and hedge effectiveness will be measured prospectively. Transition The Group has adopted the standard using the modified retrospective approach for classification and measurement and impairment. This means that the cumulative impact of the adoption has been recognized in retained earnings as of January 1, 2018 and that comparatives are not restated. All hedge accounting relationships existing as of January 1, 2018 have been continued under IFRS 9. The Company has retrospectively adopted the cost of hedging approach for foreign currency basis spreads existing in cross-currency interest rate swaps used in a hedging relationship, the impact of which is immaterial to the consolidated financial results and position of the Group. NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS NOT YET ADOPTED BY THE GROUP IFRIC 23 ‘Uncertainty over income tax treatments’ The Interpretation clarifies the application of recognition and measurement requirements in IAS 12 ‘Income Taxes’ when there is uncertainty over income tax treatments. The Group has assessed the impact of IFRIC 23, which will not be material to the consolidated financial statements of the Group upon adoption in 2019. IFRS 16 ‘Leases’ IFRS 16 replaces IAS 17 Leases , the current lease accounting standard and will become effective on January 1, 2019. The new lease standard will require assets leased by the Company to be recognized on the statement of financial position of the Company with a corresponding liability. During 2018, the Group has performed a detailed impact assessment of IFRS 16. In summary the impact of IFRS 16 adoption is expected to be, as follows: December 31, 2018 Impact of IFRS 16 January 1, 2019 Assets Non-current assets Property and equipment Property and equipment 4,932 (71 ) 4,861 Right-of-use assets — 2,023 2,023 Intangible assets 1,854 (15 ) 1,839 Goodwill 3,816 — 3,816 Deferred tax assets 197 — 197 Other financial assets 193 (1 ) 192 Total non-current assets 10,992 1,936 12,928 Current assets Trade and other receivables 577 (61 ) 516 Other current assets 2,516 — 2,516 Total current assets 3,093 (61 ) 3,032 Assets classified as held for sale 17 4 21 Total assets 14,102 1,879 15,981 Equity Equity attributable to equity owners of the parent 3,670 (3 ) 3,667 Non-controlling interest (891 ) (1 ) (892 ) Total equity 2,779 (4 ) 2,775 Non-current liabilities Financial liabilities 6,567 (45 ) 6,522 Provisions 110 — 110 Lease liabilities — 1,638 1,638 Deferred tax liabilities 180 — 180 Other liabilities 53 (9 ) 44 Total non-current liabilities 6,910 1,584 8,494 Current liabilities Trade and other payables 1,432 (54 ) 1,378 Other financial liabilities 1,289 (6 ) 1,283 Lease liabilities — 361 361 Provisions 398 (3 ) 395 Other liabilities 1,290 (3 ) 1,287 Total current liabilities 4,409 295 4,704 Liabilities associated with assets held for sale 4 4 8 Total equity and liabilities 14,102 1,879 15,981 The Company, as a lessee, will recognize a right-of-use asset and a lease liability on the lease commencement date. Upon initial recognition the right of use asset is measured as the amount equal to initially measure lease liability adjusted for lease prepayments, initial direct cost, lease incentives and the discounted estimated asset retirement obligation. Subsequently the right of use assets will be measured at cost net of any accumulated depreciation and accumulated impairment losses. Depreciation is calculated on a straight-line basis over the shorter estimated useful lives of the right-of-use assets or the lease term. The lease liability is measured upon initial recognition at the present value of the future lease and related fixed services payments over the lease term, discounted with the interest rate implicit to the lease or Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate. Subsequently lease liabilities are measured at amortized cost using the effective interest rate method. Right-of-use assets and lease liabilities will be remeasured subsequently if one of the following events occurs: • Change in lease price due to indexation or rate which has become effective in reporting period • Modifications to the lease contract • Reassessment of the lease term Leases which are short term in nature (less than 12 months including extension options) and leases of low value items will continue to be expensed in the Income Statement as incurred. Transition The Company will adopt IFRS 16 on the date the standard becomes effective, January 1, 2019. The Group will adopt the standard using the modified retrospective approach. This means that the cumulative impact of the adoption will be recognized in retained earnings as of January 1, 2019 and that comparatives will not be restated. The Group will use the following practical expedients when adopting IFRS 16 on its effective date: • to apply IFRS 16 only to contracts that were previously assessed as leases in accordance with the previous IFRS standards (IAS 17 Leases and IFRIC 4 Determining whether and Arrangement contains a Lease ) • to apply a single discount rate to a portfolio of leases with reasonably similar characteristics as permitted by IFRS 16 • to exclude initial direct cost from the measurement of if the right-of-use asset as at January 1, 2019. • Application of the Group onerous contract provision process as the impairment assessment of right-of-use assets upon transition. The weighted-average incremental rate applied to lease liabilities expected to be recognized on January 1, 2019 is 9.62% . Carrying values of property and equipment and financial liabilities related to finance leases as of December 31, 2018 will be reclassified to right-of-use assets and lease liabilities, respectively on January 1, 2019. These carrying values related to finance leases will not be remeasured at the transition date. Significant judgments upon adoption IFRS 16 Lease term judgments: IFRS 16 requires the Company to assess the lease term as the non-cancelable lease term in line with the lease contract together with the period for which the Company has extension options which the Company is reasonably certain to exercise and the periods for which the Company has termination options for which the Company is not reasonably certain to exercise those termination options. A significant portion of the lease contracts included within Company’s lease portfolio includes lease contracts which are extendable through mutual agreement between VEON and the lessor or lease contracts which are cancelable by the Company on immediately or on short notice. In assessing the lease term for the adoption of IFRS 16, the Company concluded that these cancelable future lease periods should be included within the lease term, which represents an increase to the future lease payments used in determining the lease liability upon initial recognition. The reasonably certain period used to determine the lease term is based on facts and circumstances related to the underlying leased asset and lease contracts. The following table reconciles the Company’s operating lease commitments as of December 31, 2018 , to the lease liabilities expected to be recognized upon initial application of IFRS 16 on January 1, 2019. US$ Operating lease commitments as of December 31, 2018 (see Note 4) 632 Increase in lease commitments of cancellable leases included in reasonably certain lease term 1,846 Use of IFRS 16 practical expedients (old lease accounting continues for exceptions) (4 ) Leases commencing subsequent to transition date committed to as of December 31, 2018 (47 ) Accruals included in the lease liability calculation 59 Other 22 Total undiscounted lease payments which are reasonably certain 2,508 Discounting effect using incremental borrowing rate (559 ) IAS 17 finance lease liabilities recognized on balance sheet as of December 31, 2018 (discounted) 54 Expected IFRS 16 Lease liability recognized on balance sheet as of January 1, 2019 2,003 Expected IFRS 16 lease liability presented as Non-current 1,638 Current 361 Liabilities associated with assets held for sale 4 2,003 Amsterdam, March 14, 2019 VEON Ltd. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE (Policies) | 12 Months Ended |
Dec. 31, 2018 | |
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE | |
Revenue from contracts with customers | Revenue from contracts with customers Service revenue Service revenue includes revenue from airtime charges from contract and prepaid customers, monthly contract fees, interconnect revenue, roaming charges and charges for value added services (“VAS”). VAS includes short messages, multimedia messages, caller number identification, call waiting, data transmission, mobile internet, downloadable content, mobile finance services, machine-to-machine and other services. The content revenue relating to VAS is presented net of related costs when the Company acts as an agent of the content providers and gross when the Company acts as the primary obligor of the transaction. Revenue for services with a fixed term, including fixed-term tariff plans and monthly subscriptions, is generally recognized over time, on a straight-line basis. For pay-as-you-use plans, in which the customer is charged based on actual usage, revenue is recognized over time, on a usage basis. Some tariff plans allow customers to rollover unused services to the following period. For these tariff plans, revenue is generally recognized over time, on a usage basis. For contracts which include multiple service components (such as voice, text, data), revenue is allocated based on stand-alone selling price. The stand-alone selling price for these services is determined with reference the price charged per service under a pay-as-you-use plan to similar customers. Upfront fees, including activation or connection fees, are recognized on a straight-line basis over the contract term. For contracts with an indefinite term (generally prepaid contracts), revenue from upfront fees is recognized over the average customer life. Revenue from other operators, including interconnect and roaming charges, is recognized based on the price specified in the contract, net of any estimated retrospective volume discounts. Accumulated experience is used to estimate and provide for the discounts. All service revenue is recognized over time. Sale of equipment and accessories Equipment and accessories are usually sold to customers on a stand-alone basis or together with service bundles. Where sold together with service bundles, revenue is allocated pro-rata, based on the stand-alone selling price of the equipment and the service bundle. Revenue for mobile handsets and accessories is recognized when the equipment is sold to a network customer, or, if sold via an intermediary, when the intermediary has taken control of the device and the intermediary has no remaining right of return. Revenue for fixed-line equipment is not recognized until installation and testing of such equipment are completed and the equipment is accepted by the customer. All revenue from sale of equipment and accessories is recognized at a point in time. |
Contract balances | Contract balances Receivables and contracts assets mostly relate to amounts due from other operators and postpaid customers. Contract assets, often referred to as ‘Accrued receivables’ are transferred to receivables when the rights become unconditional, which usually occurs when the Group issues an invoice to the customer. Contract liabilities, often referred to as ‘Deferred revenue’, relate primarily to non-refundable cash received from prepaid customers for fixed-term tariff plans or pay-as-you-use tariff plans. Contract liabilities are presented as ‘Long-term deferred revenue’ and ‘Short-term deferred revenue’ in Note 7. All ‘Short-term deferred revenue’ amounts outstanding at the beginning of the year have been recognized as revenue during the year. |
Customer associated costs | Customer acquisition costs Certain incremental costs incurred in acquiring a contract with a customer ( “customer acquisition costs” ), are deferred in the consolidated statement of financial position, within 'Other assets' (see Note 7). Such costs generally relate to commissions paid to third-party dealers and are amortized on a straight-line basis over the average customer life, within ‘Selling, general and administrative expenses’. The Group applies the practical expedient available for customer acquisition costs for which the amortization would have been shorter than 12 months. Such costs relate primarily to commissions paid to third-party dealers upon top-up of prepaid credit by customers and sale of top-up cards. Customer associated costs Customer associated costs relate primarily to commissions paid to third-party dealers and marketing expenses. Certain dealer commissions are initially capitalized in the consolidated statement of financial position, see Note 3 for further details. |
Operating leases | Operating leases The following accounting policy has been applied for the Group for the current and comparative years. Refer to Note 25 for details regarding changes made to accounting for leases and impact for the Group in future years. The rental payable under operating leases is recognized as an operating lease expense in the income statement on a straight-line basis over the lease term unless another systematic basis is more representative of the time pattern of VEON’s benefit. No asset is capitalized. If the periodic payments or part of the periodic payments has been prepaid, the Company recognizes these prepayments in the statement of financial position as other assets. |
Trade and other receivables | Trade and other receivables Trade and other receivables are measured at amortized cost and include invoiced amounts less appropriate allowances for estimated uncollectible amounts. |
Expected credit losses | Expected credit losses The following accounting policy has been applied with effect from January 1, 2018, see Note 25 for further details. The expected credit loss allowance (ECL) is recognized for all receivables measured at amortized cost or fair value through OCI with recycling at each reporting date. This means that an allowance for doubtful debt is recognized for all receivables even though there may not be objective evidence that the trade receivable has been impaired. VEON applies the Simplified approach (i.e. provision matrix) for calculating a lifetime ECL for its trade and other receivables, including unbilled receivables (contract assets). The provision matrix is based on the historical credit loss experience over the life of the trade receivables and is adjusted for forward-looking estimates. Forward looking estimates include macro-economic factors such as GDP (for receivables due from legal entities) and unemployment rates (for receivables due from individual customers). The provision matrix is reviewed on a quarterly basis. |
Provisions | Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are discounted using a current pre-tax rate if the time value of money is significant. |
Contingent liabilities | Contingent liabilities are possible obligations arising from past events, whose existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Group. |
Income taxes | Income taxes Income tax expense represents the aggregate amount determined on the profit for the period based on current tax and deferred tax. In cases where the tax relates to items that are charged to other comprehensive income or directly to equity, the tax is also charged respectively to other comprehensive income or directly to equity. |
Uncertain tax positions | Uncertain tax positions The Group’s policy is to comply with the applicable tax regulations in the jurisdictions in which its operations are subject to income taxes. The Group’s estimates of current income tax expense and liabilities are calculated assuming that all tax computations filed by the Company’s subsidiaries will be subject to a review or audit by the relevant tax authorities. The Company and the relevant tax authorities may have different interpretations of how regulations should be applied to actual transactions (refer below for details regarding risks and uncertainties). |
Deferred taxation | Deferred taxation Deferred taxes are recognized using the liability method and thus are computed as the taxes recoverable or payable in future periods in respect of deductible or taxable temporary differences between the tax bases of assets and liabilities and their carrying amounts in the Company’s financial statements. |
Transactions with non-controlling interests that do not result in loss of control | Transactions with non-controlling interests that do not result in loss of control Transactions with non-controlling interests that do not result in loss of control are accounted for as equity transactions – that is, as transactions with the owners in their capacity as owners. The difference between fair value of any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposals to non-controlling interests are also recorded in equity. |
Non-current assets (or disposal groups) held for sale and discontinued operations | Non-current assets (or disposal groups) held for sale and discontinued operations Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through a sale transaction or loss of control rather than through continuing use, and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair value less costs to sell. Non-current assets (including those that are part of a disposal group) are not depreciated or amortized while they are classified as held for sale. Assets and liabilities of a disposal group classified as held for sale are presented separately from the other assets and liabilities in the statement of financial position. A discontinued operation is a component that is classified as held for sale and that represents a separate major line of business or geographical area of operations. Discontinued operations are excluded from the results of continuing operations and are presented as a single amount in the income statement. All other Notes to the financial statements include amounts for continuing operations, unless otherwise mentioned. |
Property and equipment | Property and equipment is stated at cost, net of any accumulated depreciation and accumulated impairment losses. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets as follows: Class of property and equipment Useful life Telecommunication equipment 3 – 20 years Buildings and constructions 10 – 50 years Office and other equipment 3 – 10 years Each asset’s residual value, useful life and method of depreciation is reviewed at the end of each financial year and adjusted prospectively, if necessary. |
Intangible assets | Intangible assets acquired separately are measured initially at cost and are subsequently measured at cost less accumulated amortization and impairment losses. Intangible assets with a finite useful life are generally amortized with the straight-line method over the estimated useful life of the intangible asset. The amortization period and the amortization method for intangible assets with finite useful lives are reviewed at least annually. |
Goodwill | Goodwill is recognized for the future economic benefits arising from net assets acquired that are not individually identified and separately recognized. Goodwill is not amortized but is tested for impairment annually and as necessary when circumstances indicate that the carrying value may be impaired. |
Control over subsidiaries | Control over subsidiaries Subsidiaries, which are those entities over which the Company is deemed to have control, are consolidated. The Company controls an entity when the Company is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. In certain circumstances, significant judgment is required to assess if the Company is deemed to have control over entities where the Company’s ownership interest does not exceed 50% . |
Put options over non-controlling interest | Put options over non-controlling interest Put options over non-controlling interest of a subsidiary are accounted for as financial liabilities in the Company’s consolidated financial statements. The put-option redemption liability is measured at the discounted redemption amount. Interest over the put-option redemption liability will accrue in line with the effective interest rate method, until the options have been exercised or are expired. |
Derivative contracts | Derivative contracts VEON enters into derivative contracts, including swaps and forward contracts, to manage certain foreign currency and interest rate exposures. Any derivative instruments for which no hedge accounting is applied are recorded at fair value with any fair value changes recognized directly in profit or loss. Although some of the derivatives entered into by the Company have not been designated in hedge accounting relationships, they act as economic hedges and offset the underlying transactions when they occur. |
Hedges of a net investment | Hedges of a net investment The Company applies net investment hedge accounting to mitigate foreign currency translation risk related to the Company’s investments in foreign operations. The portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is recognized in other comprehensive income within the “Foreign currency translation” line item. Where the hedging instrument’s foreign currency retranslation is greater (in absolute terms) than that of the hedged item, the excess amount is recorded in profit or loss as ineffectiveness. The gain or loss on the hedging instrument relating to the effective portion of the hedge that has been recognized in other comprehensive income shall be reclassified from equity to profit or loss as a reclassification adjustment on the disposal or partial disposal of the foreign operation. Cash flows arising from derivative instruments for which hedge accounting is applied are reported in the statement of cash flows within the line item where the underlying cash flows of the hedged item are recorded. |
Basis of preparation | BASIS OF PREPARATION These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ( “IFRS” ) as issued by the International Accounting Standards Board, effective at the time of preparing the consolidated financial statements and applied by VEON. The consolidated income statement has been presented based on the nature of the expense, other than ‘Selling, general and administrative expenses’, which has been presented based on the function of the expense. The consolidated financial statements have been prepared on a historical cost basis, unless otherwise disclosed. Certain comparative amounts have been reclassified to conform to the current period presentation. |
Basis of consolidation | BASIS OF CONSOLIDATION The consolidated financial statements comprise the financial statements of the Company and its subsidiaries. Subsidiaries are all entities (including structured entities) over which the Company has control. Please refer to Note 15 for a list of significant subsidiaries. Intercompany transactions, balances and unrealized gains or losses on transactions between Group companies are eliminated. When necessary, amounts reported by subsidiaries have been adjusted to conform with the Group’s accounting policies. When the Group ceases to consolidate a subsidiary due to loss of control, the related subsidiary’s assets (including goodwill), liabilities, non-controlling interest and other components of equity are de-recognized. This may mean that amounts previously recognized in other comprehensive income are reclassified to profit or loss. Any consideration received is recognized at fair value, and any investment retained is re-measured to its fair value, and this fair value becomes the initial carrying amount for the purposes of subsequently accounting for the retained interest. Any resultant gain or loss is recognized in the income statement. |
Foreign currency translation | FOREIGN CURRENCY TRANSLATION The consolidated financial statements of the Group are presented in U.S. dollars. Each entity in the Group determines its own functional currency and amounts included in the financial statements of each entity are measured using that functional currency. Upon consolidation, the assets and liabilities measured in the functional currency are translated into U.S. dollars at exchange rates prevailing on the balance sheet date; whereas revenue, expenses, gains and losses are translated into U.S. dollars at historical exchange rates prevailing on the transaction dates. Foreign currency translation adjustments resulting from the process of translating financial statements into U.S. dollars are reported in other comprehensive income and accumulated within a separate component of equity. |
Changes in accounting policies and disclosures, new standards, interpretations, and amendments not yet adopted by the group | CHANGES IN ACCOUNTING POLICIES AND DISCLOSURES Accounting policies are included as relevant in the Notes to these consolidated financial statements. A number of new or amended standards became effective as of January 1, 2018. As a result, the Company has amended its accounting policies accordingly. The following table presents the transitional impact that adoption of IFRS 9, ‘ Financial Instruments ’ ( “IFRS 9 ”) and IFRS 15, ‘Revenue from contracts with customers’ ( “IFRS 15” ) had on the opening balance sheet of the Group, as of January 1, 2018. Further details regarding the impact of IFRS 9 and IFRS 15 can be found below. December 31, 2017* Impact of IFRS 9 Impact of IFRS 15 Classification and measurement Impairment Revenue and customer acquisition costs January 1, 2018 Assets Non-current assets Investments in joint ventures and associates 1,921 (25 ) (10 ) 38 1,924 Deferred tax assets 336 — 2 (12 ) 326 Other financial assets Available for sale 18 (18 ) — — — Fair value through other comprehensive income — 18 — — 18 Other assets 263 — — 93 356 Current assets Trade and other receivables Trade and other receivables, gross 924 — — — 924 Allowance for doubtful debt (169 ) — (14 ) (183 ) Other financial assets Available for sale 53 (53 ) — — — Fair value through profit or loss 20 20 Fair value through other comprehensive income — 33 — — 33 Other assets 418 — — (4 ) 414 Equity Equity attributable to equity owners of the parent 4,331 (25 ) (16 ) 87 4,377 Non-controlling interests (441 ) — (4 ) 15 (430 ) Liabilities Other liabilities (current) 1,353 — — (1 ) 1,352 Deferred tax liabilities 376 — (2 ) 14 388 * Opening balance sheet numbers are represented following retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (Note 10) IFRS 15 ‘Revenue from contracts with customers’ IFRS 15 replaces IAS 18 ‘Revenue’ and IAS 11 ‘Construction contracts’ and related interpretations. IFRS 15 addresses revenue recognition for contracts with customers as well as treatment of incremental costs incurred to obtain a contract with a customer, described in more detail below. Revenue recognition Due to the nature of the Group’s existing product offerings (i.e. prevailing pre-paid service offerings), as well as the Group’s accounting policies applied prior to January 1, 2018, the impact of IFRS 15 on revenue recognition by the Group was immaterial, as shown in the table presented earlier in this Note. Costs of obtaining a contract with customer Under IFRS 15, certain incremental costs incurred in acquiring a contract with a customer ( “customer acquisition costs” ), which previously did not qualify for recognition as an asset under any of the other accounting standards, are deferred in the consolidated statement of financial position. The impact of capitalizing customer acquisition costs upon implementation of IFRS 15 is shown in the table earlier in this Note. Transition The standard is effective for annual periods beginning on or after January 1, 2018. The Group has adopted the standard using the modified retrospective approach, which means that the cumulative impact of the adoption has been recognized in retained earnings as of January 1, 2018 and that comparatives have not been restated. The impact that adoption of IFRS 15 has had on the opening balance sheet of the Group, as of January 1, 2018, is shown in the table presented earlier in this Note. The impact that adoption of IFRS 15 has had on the Group’s profit / (loss) for 2018, if compared to accounting policies that were applied in previous years, was immaterial. IFRS 9 ‘Financial instruments’ IFRS 9 replaces IAS 39 ‘ Financial instruments: Recognition and Measurement ’ (“ IAS 39 ”). IFRS 9 impacts the Group’s classification and measurement of financial instruments, impairment of financial assets and hedge accounting, described in more detail below. Classification and measurement The new standard requires the Company to assess the classification of financial assets on its balance sheets in accordance with the cash flow characteristics of the financial assets and the relevant business model that the Company has for a specific class of financial assets. IFRS 9 no longer has an “Available-for-sale” classification for financial assets. The new standard has different requirements for debt or equity financial assets. Debt instruments should be classified and measured either at: • Amortized cost, where the effective interest rate method will apply; • Fair value through other comprehensive income, with subsequent recycling to the income statement upon disposal of the financial asset; or • Fair value through profit or loss. Investments in equity instruments, other than those to which consolidation or equity accounting apply, should be classified and measured either at: • Fair value through other comprehensive income, with no subsequent recycling to the income statement upon disposal of the financial asset; or • Fair value through profit or loss. The Company continues to initially measure financial assets at its fair value plus transaction cost upon initial recognition, except for financial assets measured at fair value through profit and loss, consistent with current practices. The classification for the majority of financial assets has not been impacted by the transition to IFRS 9 on January 1, 2018. The reclassifications upon transition to IFRS 9 are shown in the table presented earlier in this Note. Impairment (allowance for doubtful debt) IFRS 9 introduces the Expected Credit Loss model, which replaces the incurred loss model of IAS 39 whereby an allowance for doubtful debt was required only in circumstances where a loss event has occurred. By contrast, the Expected Credit Loss model requires the Company to recognize an allowance for doubtful debt on all financial assets carried at amortized cost (including, for example, ‘Trade receivables’), as well as debt instruments classified as financial assets carried at fair value through other comprehensive income (for example, government bonds held for liquidity purposes), since initial recognition, irrespective whether a loss event has occurred. As a result, the allowance for doubtful debt of the Company has increased upon implementation of IFRS 9 on January 1, 2018. The impact of applying the Expected Credit Loss model is shown in the table earlier in this Note. Hedge Accounting IFRS 9 allows for more possibilities for the Company to apply hedge accounting (for example, risk components of non-financial assets or liabilities may be designated as part of a hedging relationship). In addition, the requirements of the standard have been more closely aligned with the Company’s risk management policies and hedge effectiveness will be measured prospectively. Transition The Group has adopted the standard using the modified retrospective approach for classification and measurement and impairment. This means that the cumulative impact of the adoption has been recognized in retained earnings as of January 1, 2018 and that comparatives are not restated. All hedge accounting relationships existing as of January 1, 2018 have been continued under IFRS 9. The Company has retrospectively adopted the cost of hedging approach for foreign currency basis spreads existing in cross-currency interest rate swaps used in a hedging relationship, the impact of which is immaterial to the consolidated financial results and position of the Group. NEW STANDARDS, INTERPRETATIONS AND AMENDMENTS NOT YET ADOPTED BY THE GROUP IFRIC 23 ‘Uncertainty over income tax treatments’ The Interpretation clarifies the application of recognition and measurement requirements in IAS 12 ‘Income Taxes’ when there is uncertainty over income tax treatments. The Group has assessed the impact of IFRIC 23, which will not be material to the consolidated financial statements of the Group upon adoption in 2019. IFRS 16 ‘Leases’ IFRS 16 replaces IAS 17 Leases , the current lease accounting standard and will become effective on January 1, 2019. The new lease standard will require assets leased by the Company to be recognized on the statement of financial position of the Company with a corresponding liability. During 2018, the Group has performed a detailed impact assessment of IFRS 16. In summary the impact of IFRS 16 adoption is expected to be, as follows: December 31, 2018 Impact of IFRS 16 January 1, 2019 Assets Non-current assets Property and equipment Property and equipment 4,932 (71 ) 4,861 Right-of-use assets — 2,023 2,023 Intangible assets 1,854 (15 ) 1,839 Goodwill 3,816 — 3,816 Deferred tax assets 197 — 197 Other financial assets 193 (1 ) 192 Total non-current assets 10,992 1,936 12,928 Current assets Trade and other receivables 577 (61 ) 516 Other current assets 2,516 — 2,516 Total current assets 3,093 (61 ) 3,032 Assets classified as held for sale 17 4 21 Total assets 14,102 1,879 15,981 Equity Equity attributable to equity owners of the parent 3,670 (3 ) 3,667 Non-controlling interest (891 ) (1 ) (892 ) Total equity 2,779 (4 ) 2,775 Non-current liabilities Financial liabilities 6,567 (45 ) 6,522 Provisions 110 — 110 Lease liabilities — 1,638 1,638 Deferred tax liabilities 180 — 180 Other liabilities 53 (9 ) 44 Total non-current liabilities 6,910 1,584 8,494 Current liabilities Trade and other payables 1,432 (54 ) 1,378 Other financial liabilities 1,289 (6 ) 1,283 Lease liabilities — 361 361 Provisions 398 (3 ) 395 Other liabilities 1,290 (3 ) 1,287 Total current liabilities 4,409 295 4,704 Liabilities associated with assets held for sale 4 4 8 Total equity and liabilities 14,102 1,879 15,981 The Company, as a lessee, will recognize a right-of-use asset and a lease liability on the lease commencement date. Upon initial recognition the right of use asset is measured as the amount equal to initially measure lease liability adjusted for lease prepayments, initial direct cost, lease incentives and the discounted estimated asset retirement obligation. Subsequently the right of use assets will be measured at cost net of any accumulated depreciation and accumulated impairment losses. Depreciation is calculated on a straight-line basis over the shorter estimated useful lives of the right-of-use assets or the lease term. The lease liability is measured upon initial recognition at the present value of the future lease and related fixed services payments over the lease term, discounted with the interest rate implicit to the lease or Company’s incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate. Subsequently lease liabilities are measured at amortized cost using the effective interest rate method. Right-of-use assets and lease liabilities will be remeasured subsequently if one of the following events occurs: • Change in lease price due to indexation or rate which has become effective in reporting period • Modifications to the lease contract • Reassessment of the lease term Leases which are short term in nature (less than 12 months including extension options) and leases of low value items will continue to be expensed in the Income Statement as incurred. Transition The Company will adopt IFRS 16 on the date the standard becomes effective, January 1, 2019. The Group will adopt the standard using the modified retrospective approach. This means that the cumulative impact of the adoption will be recognized in retained earnings as of January 1, 2019 and that comparatives will not be restated. The Group will use the following practical expedients when adopting IFRS 16 on its effective date: • to apply IFRS 16 only to contracts that were previously assessed as leases in accordance with the previous IFRS standards (IAS 17 Leases and IFRIC 4 Determining whether and Arrangement contains a Lease ) • to apply a single discount rate to a portfolio of leases with reasonably similar characteristics as permitted by IFRS 16 • to exclude initial direct cost from the measurement of if the right-of-use asset as at January 1, 2019. • Application of the Group onerous contract provision process as the impairment assessment of right-of-use assets upon transition. The weighted-average incremental rate applied to lease liabilities expected to be recognized on January 1, 2019 is 9.62% . Carrying values of property and equipment and financial liabilities related to finance leases as of December 31, 2018 will be reclassified to right-of-use assets and lease liabilities, respectively on January 1, 2019. These carrying values related to finance leases will not be remeasured at the transition date. Significant judgments upon adoption IFRS 16 Lease term judgments: IFRS 16 requires the Company to assess the lease term as the non-cancelable lease term in line with the lease contract together with the period for which the Company has extension options which the Company is reasonably certain to exercise and the periods for which the Company has termination options for which the Company is not reasonably certain to exercise those termination options. A significant portion of the lease contracts included within Company’s lease portfolio includes lease contracts which are extendable through mutual agreement between VEON and the lessor or lease contracts which are cancelable by the Company on immediately or on short notice. In assessing the lease term for the adoption of IFRS 16, the Company concluded that these cancelable future lease periods should be included within the lease term, which represents an increase to the future lease payments used in determining the lease liability upon initial recognition. The reasonably certain period used to determine the lease term is based on facts and circumstances related to the underlying leased asset and lease contracts. The following table reconciles the Company’s operating lease commitments as of December 31, 2018 , to the lease liabilities expected to be recognized upon initial application of IFRS 16 on January 1, 2019. |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of operating segments [abstract] | |
Summary of reportable segments financial information | Financial information by reportable segment for the periods ended December 31 is presented in the following tables. Inter-segment transactions between operating segments are made on terms which are comparable to transactions with third parties. External customers Inter-segment Total revenue Revenue 2018 2017 2016 2018 2017 2016 2018 2017 2016 Russia 4,632 4,698 4,059 22 31 38 4,654 4,729 4,097 Pakistan 1,481 1,525 1,293 13 — 2 1,494 1,525 1,295 Algeria 810 914 1,040 3 1 — 813 915 1,040 Bangladesh 521 574 621 — — — 521 574 621 Ukraine 663 600 566 25 22 20 688 622 586 Uzbekistan 314 513 662 1 — 1 315 513 663 HQ — — 10 — — — — — 10 Others 665 650 634 (64 ) (54 ) (61 ) 601 596 573 Total segments 9,086 9,474 8,885 — — — 9,086 9,474 8,885 Adjusted EBITDA Capital expenditures excluding licenses Other disclosures 2018 2017 2016 2018 2017* 2016* Russia 1,677 1,788 1,574 742 667 643 Pakistan 714 703 507 199 240 215 Algeria 363 426 547 107 132 165 Bangladesh 183 233 267 93 101 137 Ukraine 387 347 306 115 98 104 Uzbekistan 136 261 395 39 63 174 HQ (357 ) (325 ) (421 ) 11 31 24 Other 170 154 57 109 128 130 Total segments 3,273 3,587 3,232 1,415 1,460 1,592 * Prior period comparatives have been restated to exclude certain costs, such as cost to acquire telecommunication licenses. |
Summary of segments reconciliation of consolidated Adjusted EBITDA to consolidated income statement before tax | The following table provides the reconciliation of consolidated Adjusted EBITDA to consolidated income statement before tax for the years ended December 31 : 2018 2017* 2016* Total Segments Adjusted EBITDA 3,273 3,587 3,232 Depreciation (1,339 ) (1,491 ) (1,439 ) Amortization (495 ) (537 ) (497 ) Impairment (loss) / reversal (858 ) (66 ) (192 ) Gain / (loss) on disposal of non-current assets (57 ) (26 ) (20 ) Gain / (loss) on sale of subsidiaries 30 — — Finance costs (816 ) (935 ) (830 ) Finance income 67 95 69 Other non-operating gain / (loss), net (68 ) (97 ) (82 ) Share of loss of joint ventures and associates — (22 ) (11 ) Impairment of joint ventures and associates — (110 ) (99 ) Net foreign exchange gain / (loss) 15 (70 ) 157 Profit / (loss) before tax from continuing operations (248 ) 328 288 |
Summary of geographical information of non-current assets | The total of non-current assets (other than financial instruments, investments in subsidiaries and deferred tax assets, which are included in Other, along with consolidation eliminations), broken down by location of the assets, is shown in the following tables: 2018 2017 Russia 4,794 5,969 Pakistan 1,661 2,270 Algeria 1,890 2,151 Bangladesh 773 988 Ukraine 748 552 Uzbekistan 211 213 HQ 17 55 Other 898 3,345 Total segments 10,992 15,543 |
OPERATING REVENUE (Tables)
OPERATING REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Revenue [abstract] | |
Summary of total operating revenue from external customers by mobile and fixed line services | The following table provides a breakdown of revenue from contracts with customers by mobile and fixed line for the years ended December 31 : Mobile Fixed line Total revenue 2018 2017 2016 2018 2017 2016 2018 2017 2016 Russia 4,085 4,053 3,430 569 676 667 4,654 4,729 4,097 Pakistan 1,494 1,525 1,295 — — — 1,494 1,525 1,295 Algeria 813 915 1,040 — — — 813 915 1,040 Bangladesh 521 574 621 — — — 521 574 621 Ukraine 644 581 545 44 41 41 688 622 586 Uzbekistan 313 510 659 2 3 4 315 513 663 HQ — — — — — 10 — — 10 Others 496 530 499 105 66 74 601 596 573 Total segments 8,366 8,688 8,089 720 786 796 9,086 9,474 8,885 |
Summary of breakdown of contract balances | The following table provides a breakdown of contract balances and capitalized customer acquisition costs. December 31, 2018 January 1, 2018 Contract balances Receivables (billed) 673 780 Contract assets (unbilled) 43 18 Contract liabilities (161 ) (157 ) Capitalized costs Customer acquisition costs 83 93 |
Summary of capitalized customer acquisition costs | The following table provides a breakdown of contract balances and capitalized customer acquisition costs. December 31, 2018 January 1, 2018 Contract balances Receivables (billed) 673 780 Contract assets (unbilled) 43 18 Contract liabilities (161 ) (157 ) Capitalized costs Customer acquisition costs 83 93 |
SELLING, GENERAL AND ADMINISTRA
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Selling, general and administrative expense [abstract] | |
Schedule of selling, general and administrative expenses | Selling, general and administrative expenses consisted of the following items for the years ended December 31 : 2018 2017 2016 Network and IT costs 1,176 1,185 1,043 Personnel costs 889 927 775 Customer associated costs 867 893 822 Losses on receivables 62 59 58 Taxes, other than income taxes 217 219 244 Other 486 465 726 Total selling, general and administrative expenses 3,697 3,748 3,668 |
Schedule of operating lease commitments | Operating lease commitments are as follows as of December 31 : 2018 2017 Less than 1 year 102 70 Between 1 and 3 years 211 151 Between 3 and 5 years 139 78 More than 5 years 180 167 Total commitments 632 466 |
OTHER NON-OPERATING LOSSES, N_2
OTHER NON-OPERATING LOSSES, NET (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
OTHER NON-OPERATING LOSSES, NET | |
Schedule of other non-operating (losses) / gains | Other non-operating (losses) / gains consisted of the following for the years ended December 31 : 2018 2017 2016 Loss from early debt redemption (30 ) (124 ) — Change of fair value of other derivatives (58 ) (13 ) (120 ) Impairment loss of other financial assets (2 ) (20 ) — Gains relating to past acquisitions and divestments 4 70 21 Other gains / (losses) 18 (10 ) 17 Other non-operating gain / (loss), net (68 ) (97 ) (82 ) |
TRADE AND OTHER RECEIVABLES (Ta
TRADE AND OTHER RECEIVABLES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Trade and other current receivables [abstract] | |
Schedule of trade and other receivables | Trade and other receivables consisted of the following items as of December 31: 2018 2017 2016 Trade receivables (gross)* 716 798 769 Allowance for doubtful debt (171 ) (169 ) (160 ) Trade receivables (net) 545 629 609 Other receivables 32 126 76 Total trade and other receivables 577 755 685 * Includes contract assets (unbilled receivables), see Note 3 for further details |
Schedule of movements in the allowance for doubtful debt | As of December 31, 2018 , an impairment of US $171 ( 2017 : US $169 , 2016: US $160 ) is recorded against trade receivables. See below the movements in the allowance for doubtful debt: 2018 2017 2016 Balance as of January 1 before IFRS 9 adjustment 169 160 182 Adjustment due to IFRS 9 (see Note 25) 14 — — Balance as of January 1 after IFRS 9 adjustment 183 160 182 Allowance for doubtful debts 47 36 73 Recoveries (17 ) (9 ) (5 ) Accounts receivable written off (18 ) (13 ) (44 ) Acquisitions and divestments of subsidiaries — — (48 ) Foreign currency translation adjustment (15 ) (4 ) 2 Other movements (9 ) (1 ) — Balance as of December 31 171 169 160 |
Schedule of aging of trade receivables | Set out below is the information about the Group’s trade receivables and contract assets using a provision matrix: Days past due December 31, 2018 Contract assets Current < 30 days Between 31 and 120 days > 120 days Total Expected loss rate, % 0.2 % 1.2 % 9.6 % 33.6 % 81.5 % Trade receivables, gross 44 389 61 44 178 716 Expected credit losses (1 ) (5 ) (6 ) (15 ) (144 ) (171 ) Trade receivables, net 43 384 55 29 34 545 Days past due January 1, 2018 Contract assets Current < 30 days Between 31 and 120 days > 120 days Total Expected loss rate, % 1.1 % 1.3 % 7.6 % 27.6 % 63.9 % Trade receivables, gross 18 371 92 87 230 798 Expected credit losses — (5 ) (7 ) (24 ) (147 ) (183 ) Trade receivables, net 18 366 85 63 83 615 |
OTHER ASSETS AND LIABILITIES (T
OTHER ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
OTHER ASSETS AND LIABILITIES | |
Schedule of other non-current assets | Other assets consisted of the following items as of December 31 : 2018 2017 Other non-current assets Customer acquisition costs (see Note 3) 83 — Non-current income tax advances (see Note 9) 32 28 Other financial assets 58 34 Advances to suppliers 11 17 Deferred costs related to connection fees 6 7 Indemnification assets 3 177 Total other non-current assets 193 263 Other current assets Advances to suppliers 151 162 Input value added tax 149 181 Current income tax assets (see Note 9) 112 230 Prepaid taxes 39 31 Deferred costs related to connection fees 8 12 Other assets 20 32 Total other current assets 479 648 |
Schedule of other current assets | Other assets consisted of the following items as of December 31 : 2018 2017 Other non-current assets Customer acquisition costs (see Note 3) 83 — Non-current income tax advances (see Note 9) 32 28 Other financial assets 58 34 Advances to suppliers 11 17 Deferred costs related to connection fees 6 7 Indemnification assets 3 177 Total other non-current assets 193 263 Other current assets Advances to suppliers 151 162 Input value added tax 149 181 Current income tax assets (see Note 9) 112 230 Prepaid taxes 39 31 Deferred costs related to connection fees 8 12 Other assets 20 32 Total other current assets 479 648 |
Schedule of other non-current liabilities | Other liabilities consisted of the following items as of December 31 : 2018 2017 Other non-current liabilities Long-term deferred revenue (see Note 3) 10 12 Pensions and other post-employment benefits 29 54 Other liabilities 14 17 Total other non-current liabilities 53 83 Other current liabilities Short-term deferred revenue (see Note 3) 151 146 Customer advances 200 228 Customer deposits 192 189 Current income tax payables (see Note 9) 32 48 Other taxes payable 352 427 Other payments to authorities 86 91 Due to employees 198 173 Other liabilities 79 99 Total other current liabilities 1,290 1,401 |
Schedule of other current liabilities | Other liabilities consisted of the following items as of December 31 : 2018 2017 Other non-current liabilities Long-term deferred revenue (see Note 3) 10 12 Pensions and other post-employment benefits 29 54 Other liabilities 14 17 Total other non-current liabilities 53 83 Other current liabilities Short-term deferred revenue (see Note 3) 151 146 Customer advances 200 228 Customer deposits 192 189 Current income tax payables (see Note 9) 32 48 Other taxes payable 352 427 Other payments to authorities 86 91 Due to employees 198 173 Other liabilities 79 99 Total other current liabilities 1,290 1,401 |
PROVISIONS AND CONTINGENT LIA_2
PROVISIONS AND CONTINGENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of other provisions [abstract] | |
Schedule of movement in provisions | The following table summarizes the movement in provisions for the years ended December 31 : Income tax provisions Non-income tax provisions Decommi-ssioning provision Legal provision Other provisions Total Cost As of January 1, 2017 244 96 98 157 27 622 Arising during the year 57 28 5 28 26 144 Reclassified to assets held for sale (1 ) — (4 ) — — (5 ) Utilized (4 ) (16 ) (1 ) (66 ) (13 ) (100 ) Unused amounts reversed (32 ) (4 ) (2 ) (68 ) (9 ) (115 ) Discount rate adjustment and imputed interest (change in estimate) — — 10 — — 10 Translation adjustments and other (6 ) (6 ) — (2 ) 3 (11 ) As of December 31, 2017 258 98 106 49 34 545 Current — — 106 16 1 123 Non-current 258 98 — 33 33 422 As of January 1, 2018 258 98 106 49 34 545 Arising during the year 11 11 4 5 43 74 Reclassified to assets held for sale (1 ) (1 ) (4 ) — — (6 ) Utilized (6 ) (11 ) (1 ) (2 ) (15 ) (35 ) Unused amounts reversed — — (2 ) (8 ) — (10 ) Transfer and reclassification (65 ) 65 — — — — Discount rate adjustment and imputed interest (change in estimate) — — 8 — — 8 Translation adjustments and other (33 ) (12 ) (18 ) — (5 ) (68 ) As of December 31, 2018 164 150 93 44 57 508 Non-current — — 93 17 — 110 Current 164 150 — 27 57 398 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Major components of tax expense (income) [abstract] | |
Summary of income tax expense | Income tax expense consisted of the following for the years ended December 31 : 2018 2017 2016 Current income taxes Current year 477 397 615 Adjustments in respect of previous years 9 (28 ) (3 ) Total current income taxes 486 369 612 Deferred income taxes Origination / reversal of temporary differences (419 ) (159 ) (217 ) Changes in tax rates 6 10 (7 ) Current year tax losses unrecognized 283 146 172 Recognition / utilization of previously unrecognized tax losses or tax credits (16 ) — (15 ) Derecognition of previously recognized tax losses — — 95 Write off deferred tax assets — 20 — Adjustments in respect of previous years 28 86 — Other 1 — (5 ) Total deferred tax expense (117 ) 103 23 Income tax expense 369 472 635 |
Summary of reconciliation between statutory and effective income tax | The table below outlines the reconciliation between the statutory tax rate in the Netherlands ( 25% ) and the effective income tax rates for the Group, together with the corresponding amounts, for the years ended December 31 : 2018 2017 2016 Profit / (loss) before tax from continuing operations (248 ) 328 288 Income tax benefit / (expense) at statutory tax rate (25.0%) 62 (82 ) (72 ) Difference due to the effects of: Different tax rates in different jurisdictions 89 84 (152 ) Non-deductible expenses (120 ) (117 ) (89 ) Non-taxable income 49 35 66 Adjustments in respect of previous years (39 ) (52 ) 3 Movement in (un)recognized deferred tax assets (354 ) (166 ) (247 ) Withholding taxes 45 (123 ) (62 ) Tax claims (17 ) (24 ) (59 ) Change in income tax rate (6 ) (10 ) 7 Minimum taxes and other (78 ) (17 ) (30 ) Income tax benefit / (expense) (369 ) (472 ) (635 ) Effective tax rate -148.8 % 143.9 % 220.5 % Reason Explanation Different tax rates in different jurisdictions Certain jurisdictions in which VEON operates have income tax rates which are different to the Dutch statutory tax rate of 25%. Profitability in countries with higher tax rates (including Pakistan, Uzbekistan and Bangladesh) has a negative impact on the effective tax rate. Non-deductible expenses Impairment losses on property and equipment, intangible assets and goodwill are generally treated as non-deductible expenses for tax purposes, except where the impairment loss results in a change to a temporary difference. In 2018, impairment losses described in Note 11 had a negative impact on the effective tax rate, except for Bangladesh, where existing deferred tax liabilities on these assets had the effect of offsetting this impact. Non-taxable income The Group earns non-taxable income primarily in its holding companies, relating to gains on sale of subsidiaries, unrealized foreign exchange gains and certain income classified as non-taxable in accordance with the Final Tax Regime in Pakistan. Adjustments in respect of previous years The tax legislation in the markets in which VEON operates is unpredictable and gives rise to significant uncertainties (see ‘Sources of estimation uncertainty’ below). Movement in (un)recognized deferred tax assets Movements in recognized deferred tax assets are primarily caused by tax losses for which no deferred tax asset has been recognized. Withholding taxes Withholding taxes are recognized to the extent that dividends from foreign operations are expected to be paid in the foreseeable future. Tax claims Tax claims relate primarily to increases in uncertain tax positions in GTH. Change in income tax rate Changes in tax rates impact the valuation of existing temporary differences. Minimum taxes and other Minimum taxes and other relate primarily to the recording of alternative minimum and local taxes in Pakistan. |
Schedule of deferred tax assets and liabilities in the statement of financial position | The Group reported the following deferred tax assets and liabilities in the statement of financial position as of December 31 : 2018 2017 Deferred tax assets 197 336 Deferred tax liabilities (180 ) (376 ) Net deferred tax position 17 (40 ) |
Summary of movements of deferred tax assets and liabilities | The following table shows the movements of the deferred tax assets and liabilities in 2018 : Movement in deferred taxes Opening balance Net income statement movement Changes in composition of the group Other comprehensive & other Currency translation Closing balance Property and equipment (443 ) 126 — (3 ) 45 (275 ) Intangible assets (165 ) 94 — (2 ) 13 (60 ) Trade receivables 36 (6 ) — 3 (1 ) 32 Provisions 33 2 — (5 ) — 30 Accounts payable 133 7 — (11 ) (16 ) 113 Withholding tax on distributed earnings (116 ) 70 — (3 ) (1 ) (50 ) Tax losses and other balances carried forwards 2,434 (191 ) — (19 ) (51 ) 2,173 Non-recognized deferred tax assets (1,980 ) — — 25 — (1,955 ) Other 28 15 — (33 ) (1 ) 9 Net deferred tax positions (40 ) 117 — (48 ) (12 ) 17 The following table shows the movements of the deferred tax assets and liabilities in 2017 : Movement in deferred taxes Opening balance Net income statement movement Changes in composition of the group Other comprehensive & other Currency translation Closing balance Property and equipment (420 ) (6 ) — (13 ) (4 ) (443 ) Intangible assets (166 ) — — (4 ) 5 (165 ) Trade receivables 30 19 — (4 ) (9 ) 36 Provisions 29 3 — (3 ) 4 33 Accounts payable 94 38 — 28 (27 ) 133 Withholding tax on distributed earnings (73 ) (43 ) — 1 (1 ) (116 ) Tax losses and other balances carried forwards 2,270 (47 ) — 261 (50 ) 2,434 Non-recognized deferred tax assets (1,849 ) — — (131 ) — (1,980 ) Other 97 (67 ) — (35 ) 33 28 Net deferred tax positions 12 (103 ) — 100 (49 ) (40 ) |
Summary of amount and expiry date of deductible temporary differences, unused tax losses and other carry forwards | The amount and expiry date of unused tax losses and other carry forwards for which no deferred tax asset is recognized are as follows: As of December 31, 2018 0-5 years 6-10 years More than 10 years Indefinite Total Tax losses expiry Recognized losses (83 ) — — (425 ) (508 ) Recognized DTA 17 — — 146 163 Non-recognized losses (968 ) (2,421 ) — (6,346 ) (9,735 ) Non-recognized DTA 198 497 — 1,260 1,955 Other credits carried forwards expiry Recognized credits (55 ) — — — (55 ) Recognized DTA 55 — — — 55 Non-recognized credits — — — — — Non-recognized DTA — — — — — As of December 31, 2017 0-5 years 6-10 years More than 10 years Indefinite Total Tax losses expiry Recognized losses (347 ) (12 ) — (833 ) (1,192 ) Recognized DTA 85 3 — 234 322 Non-recognized losses (420 ) (2,639 ) — (6,396 ) (9,455 ) Non-recognized DTA 95 660 — 1,232 1,987 Other credits carried forwards expiry Recognized credits (68 ) — — — (68 ) Recognized DTA 68 — — — 68 Non-recognized credits — — — — — Non-recognized DTA — — — — — |
SIGNIFICANT TRANSACTIONS (Table
SIGNIFICANT TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
SIGNIFICANT TRANSACTIONS | |
Schedule of effect of the disposal | The effect of the disposal is detailed below: 2018 Cash consideration received 2,830 Derecognition of assets classified as held for sale (1,599 ) Release cumulative share of other comprehensive income / (loss) of Italy Joint Venture (31 ) Release cumulative foreign currency translation reserve related to Italy Joint Venture * 79 Gain / (loss) on disposal of discontinued operations 1,279 * Included in the release of cumulative foreign currency translation reserve is an accumulated loss of US $80 , arising from the release of the net investment hedge related to the Company’s investment in the Italy Joint Venture. |
Schedule of financial information related to the discontinued operation | The following table shows the impact of the retrospective recognition of depreciation expense in profit or loss for the period ended December 31, 2017 and reversal of the reclassification of Deodar assets and liabilities as held for sale on VEON’s balance sheet as of December 31, 2017 : Balance sheet as reported Retrospective depreciation recorded in 2017 Reclassification Adjusted balance sheet Assets Property and equipment 6,097 (37 ) 177 6,237 Goodwill 4,394 — 224 4,618 Deferred tax assets 272 — 64 336 Other non-current assets 199 — 2 201 Other current assets 2,443 — 44 2,487 Assets classified as held for sale 533 — (511 ) 22 Equity Equity attributable to equity owners of the parent 4,352 (21 ) — 4,331 Equity of non-controlling interest (425 ) (16 ) — (441 ) Liabilities Non-current liabilities 10,937 — 7 10,944 Current liabilities 4,607 — 28 4,635 Liabilities associated with assets held for sale 50 — (35 ) 15 The table below provides the details of share of profit / (loss) and share of other comprehensive income / (loss) of the Italy Joint Venture for the following years: Discontinued operations 2018 2017 2016 Share of profit / (loss) of Italy Joint Venture (300 ) (390 ) 59 Share of other comprehensive income / (loss) of Italy Joint Venture (18 ) (12 ) — |
IMPAIRMENT (Tables)
IMPAIRMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of impairment loss and reversal of impairment loss [abstract] | |
Schedule of total amount of the impairment loss allocated to the carrying amounts of assets | 2017 Property and equipment Goodwill Total impairment Armenia — 34 34 Kyrgyzstan — 17 17 Other 15 — 15 15 51 66 2018 Property and equipment Intangible assets Goodwill Total impairment Algeria — — 125 125 Armenia 46 10 25 81 Bangladesh 221 230 — 451 Georgia 31 19 — 50 Kyrgyzstan — — 74 74 Other 37 40 — 77 335 299 224 858 2016 Property and equipment Intangible assets Goodwill Other assets* Total impairment Georgia 16 13 — — 29 Kyrgyzstan — — 49 — 49 Tajikistan 54 1 21 12 88 Other 30 — 8 — 38 100 14 78 12 204 * Other assets include trade and other receivables and deferred tax assets. Impairment of these assets has been recognized on the income statement accounts relating to these assets, i.e. Selling, general and administrative expenses and Income tax expense. |
Schedule of key assumptions used in fair value less costs of disposal calculations | The table below shows key assumptions used in fair value less costs of disposal calculations. Discount rate (local currency) Average annual revenue growth rate during forecast period Terminal growth rate 2018 2017 2016 2018 2017 2016 2018 2017 2016 Russia 10.3 % 10.6 % 9.7 % 1.1 % 1.9 % 2.4 % 1.3 % 1.0 % 1.0 % Ukraine 16.3 % 17.1 % 17.2 % 4.4 % 3.9 % 3.6 % 4.0 % 2.0 % 1.0 % Algeria 11.1 % 10.7 % 9.8 % 0.7 % 1.0 % (0.8 )% 0.9 % 3.0 % 3.0 % Pakistan 14.4 % 15.0 % 14.3 % 3.5 % 5.0 % 7.6 % 4.0 % 4.0 % 4.0 % Bangladesh 12.2 % 12.7 % 11.9 % 0.6 % 5.0 % 6.4 % 4.0 % 4.6 % 4.7 % Kazakhstan 8.4 % 10.8 % 12.4 % 2.8 % 3.2 % 4.4 % 1.1 % 2.4 % 2.0 % Kyrgyzstan 14.8 % 15.5 % 14.5 % 2.8 % (1.5 )% (1.8 )% 5.0 % 3.5 % 2.5 % Uzbekistan 13.1 % 15.3 % 15.4 % 5.5 % 6.9 % 1.7 % 6.3 % 6.5 % 1.0 % Armenia 12.5 % 13.0 % 12.0 % 0.2 % (1.0 )% (2.8 )% 0.8 % 3.0 % 1.0 % Georgia 10.6 % 11.0 % 10.3 % 2.1 % 5.6 % 6.4 % 3.0 % 1.0 % 1.0 % Average operating margin Average CAPEX as a percentage of revenue 2018 2017 2016 2018 2017 2016 Russia 34.6 % 36.4 % 38.6 % 19.8 % 15.7 % 15.9 % Ukraine 54.0 % 49.9 % 44.9 % 16.3 % 15.6 % 17.0 % Algeria 44.0 % 46.2 % 50.8 % 15.1 % 14.8 % 15.8 % Pakistan 47.9 % 43.6 % 33.3 % 16.7 % 15.3 % 14.3 % Bangladesh 35.4 % 38.7 % 44.9 % 14.9 % 14.3 % 14.6 % Kazakhstan 46.5 % 44.5 % 43.6 % 17.7 % 17.9 % 18.8 % Kyrgyzstan 39.9 % 42.0 % 43.9 % 17.2 % 16.4 % 17.0 % Uzbekistan 43.9 % 42.9 % 58.2 % 16.2 % 14.1 % 18.2 % Armenia 23.6 % 29.7 % 37.8 % 21.0 % 19.6 % 14.1 % Georgia 24.5 % 25.2 % 25.7 % 23.8 % 23.3 % 17.3 % |
Schedule of key assumptions and inputs used by the Company in determining the recoverable amount | Assumption Description Discount rate Discount rates are initially determined in US$ based on the risk-free rate for 20-year maturity bonds of the United States Treasury, adjusted for a risk premium to reflect both the increased risk of investing in equities and the systematic risk of the specific CGU relative to the market as a whole. The equity market risk premium used was 5.4% (2017: 6.0%). The systematic risk, beta, represents the median of the raw betas of the entities comparable in size and geographic footprint with the ones of the Company ( “Peer Group” ). The debt risk premium is based on the median of Standard & Poor’s long-term credit rating of the Peer Group. The weighted average cost of capital is determined based on target debt-to-equity ratios representing the median historical five-year capital structure for each entity from the Peer Group. The discount rate in functional currency of a CGU is adjusted for the long-term inflation forecast of the respective country in which the business operates, as well as applicable country risk premium. Projected revenue growth rates The revenue growth rates vary based on numerous factors, including size of market, GDP (Gross Domestic Product), foreign currency projections, traffic growth, market share and others. Projected average operating margin The Company estimates operating margin based on Adjusted EBITDA divided by Total Operating Revenue for each CGU and each future year. The forecasted operating margin is based on the budget of the following year and assumes cost optimization initiatives which are part of on-going operations, as well as regulatory and technological changes known to date, such as telecommunication license issues and price regulation among others. Average capital expenditure as a percentage of revenue Capital expenditure ( “CAPEX” ) is defined as purchases of property and equipment and intangible assets other than goodwill. The cash flow forecasts for capital expenditure are based on past experience and amounts budgeted for the following year(s) and include the network roll-outs plans and license requirements. Projected license and spectrum payments The cash flow forecasts for license and spectrum payments for each operating company for the initial five years include amounts for expected renewals and newly available spectrum. Beyond that period, a long-run cost of spectrum is assumed. Long-term growth rate A long‑term growth rate into perpetuity is estimated based on a percentage that is lower than or equal to the country long-term inflation forecast, depending on the CGU. |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Property, plant and equipment [abstract] | |
Schedule of property and equipment | The following table summarizes the movement in the net book value of property and equipment for the years ended December 31 : Net book value Telecomm-unications equipment Land, Office and other equipment Equipment not installed and assets under construction Total As of January 1, 2017 5,166 243 456 854 6,719 Additions 39 14 26 1,194 1,273 Disposals (36 ) — (7 ) (6 ) (49 ) Depreciation charge for the year (1,307 ) (32 ) (152 ) — (1,491 ) Impairment (5 ) — — (10 ) (15 ) Transfers 1,440 16 147 (1,603 ) — Reclassified to assets held for sale (13 ) (1 ) (2 ) (1 ) (17 ) Translation adjustment (152 ) — 2 (33 ) (183 ) As of December 31, 2017 5,132 240 470 395 6,237 Additions 52 8 14 1,173 1,247 Disposals (51 ) (2 ) (10 ) (5 ) (68 ) Depreciation charge for the year (1,165 ) (31 ) (143 ) — (1,339 ) Impairment (280 ) (10 ) (8 ) (37 ) (335 ) Transfers 979 22 136 (1,137 ) — Reclassified to assets held for sale (15 ) (1 ) — — (16 ) Translation adjustment (644 ) (24 ) (66 ) (60 ) (794 ) As of December 31, 2018 4,008 202 393 329 4,932 Cost 10,758 443 1,271 459 12,931 Accumulated depreciation and impairment (6,750 ) (241 ) (878 ) (130 ) (7,999 ) |
Schedule of capital commitments for the future purchase of equipment | Capital commitments for the future purchase of equipment are as follows as of December 31 : 2018 2017 Less than 1 year 433 555 Between 1 and 5 years 4 262 Total commitments 437 817 Capital commitments for the future purchase of intangible assets are as follows as of December 31 : 2018 2017 Less than 1 year 23 40 Between 1 and 5 years — 4 Total commitments 23 44 |
Schedule of estimated useful lives | Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets as follows: Class of property and equipment Useful life Telecommunication equipment 3 – 20 years Buildings and constructions 10 – 50 years Office and other equipment 3 – 10 years |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of detailed information about intangible assets [abstract] | |
Schedule of total gross carrying value and accumulated amortization of intangible assets | The following table summarizes the movement in the net book value of intangible assets for the years ended December 31 : Net book value Telecommuni-cation licenses, frequencies & permissions Software Brands and trademarks Customer relationships Other intangible assets Total As of January 1, 2017 1,128 380 358 337 54 2,257 Additions 332 178 — — 8 518 Disposals (1 ) (2 ) — — (1 ) (4 ) Amortization charge for the year (161 ) (206 ) (83 ) (75 ) (12 ) (537 ) Transfer — 4 — — (4 ) — Translation adjustment (42 ) (3 ) (13 ) (7 ) (1 ) (66 ) As of December 31, 2017 1,256 351 262 255 44 2,168 Additions 526 171 — — 20 717 Disposals (6 ) (1 ) — — — (7 ) Amortization charge for the year (176 ) (179 ) (74 ) (54 ) (12 ) (495 ) Impairment (251 ) (48 ) — — — (299 ) Transfer — 2 — — (2 ) — Translation adjustment (154 ) (32 ) (10 ) (24 ) (10 ) (230 ) As of December 31, 2018 1,195 264 178 177 40 1,854 Cost 2,365 1,006 527 1,675 254 5,827 Accumulated amortization and impairment (1,170 ) (742 ) (349 ) (1,498 ) (214 ) (3,973 ) |
Schedule of capital commitments for the future purchase of intangible assets | Capital commitments for the future purchase of equipment are as follows as of December 31 : 2018 2017 Less than 1 year 433 555 Between 1 and 5 years 4 262 Total commitments 437 817 Capital commitments for the future purchase of intangible assets are as follows as of December 31 : 2018 2017 Less than 1 year 23 40 Between 1 and 5 years — 4 Total commitments 23 44 |
GOODWILL (Tables)
GOODWILL (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of impairment loss and reversal of impairment loss [abstract] | |
Schedule of goodwill acquired through business combinations allocated to CGUs for impairment testing | The movement in goodwill for the Group, per cash generating unit ( “CGU” ), consisted of the following as of December 31, 2018 : CGU December 31, Impairment Currency translation December 31, Russia 2,018 — (416 ) 2,434 Algeria 1,176 (125 ) (39 ) 1,340 Pakistan 371 — (97 ) 468 Kazakhstan 153 — (24 ) 177 Kyrgyzstan 54 (74 ) — 128 Uzbekistan 44 — (2 ) 46 Armenia — (25 ) — 25 Total 3,816 (224 ) (578 ) 4,618 CGU December 31, Impairment Translation adjustment December 31, Russia 2,434 — 122 2,312 Algeria 1,340 — (53 ) 1,393 Pakistan 468 — (29 ) 497 Kazakhstan 177 — 1 176 Kyrgyzstan 128 (17 ) — 145 Uzbekistan 46 — (68 ) 114 Armenia 25 (34 ) — 59 Total 4,618 (51 ) (27 ) 4,696 |
INVESTMENTS IN SUBSIDIARIES (Ta
INVESTMENTS IN SUBSIDIARIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of subsidiaries [abstract] | |
Schedule of information about significant subsidiaries | The Company held investments in the material subsidiaries for the years ended December 31 as detailed in the table below. The equity interest presented represents the economic rights available to the Company. Equity interest held by the Group Name of significant subsidiary Country of incorporation Nature of subsidiary 2018 2017 VEON Amsterdam B.V. Netherlands Holding 100 % 100 % VEON Holdings B.V. Netherlands Holding 100 % 100 % PJSC VimpelCom Russia Operating 100 % 100 % JSC “Kyivstar” Ukraine Operating 100 % 100 % LLP “KaR-Tel” Kazakhstan Operating 75 % 75 % LLC “Unitel” Uzbekistan Operating 100 % 100 % LLC “VEON Georgia” Georgia Operating 80 % 80 % CJSC “VEON Armenia” Armenia Operating 100 % 100 % LLC “Sky Mobile” Kyrgyzstan Operating 50 % 50 % VEON Luxembourg Holdings S.à r.l. Luxembourg Holding 100 % 100 % VEON Luxembourg Finance Holdings S.à r.l. Luxembourg Holding 100 % 100 % VEON Luxembourg Finance S.A. Luxembourg Holding 100 % 100 % Global Telecom Holding S.A.E Egypt Holding 58 % 58 % Omnium Telecom Algérie S.p.A.* Algeria Holding 26 % 26 % Optimum Telecom Algeria S.p.A.* Algeria Operating 26 % 26 % Pakistan Mobile Communications Limited Pakistan Operating 49 % 49 % Banglalink Digital Communications Limited Bangladesh Operating 58 % 58 % LLC “Tacom” ** Tajikistan Operating — 98 % VimpelCom Lao Co. Ltd. ** Lao PDR Operating — 78 % * The Group has concluded that it controls Omnium Telecom Algérie S.p.A and Optimum Telecom Algeria S.p.A even though its subsidiary, Global Telecom Holding S.A.E. owns less than 50% of the ordinary shares. This is because the Company can exercise operational control through terms of a shareholders’ agreement. ** During 2018 , the Group sold its operations in Tajikistan and Laos, see below in this Note for further details. During the second quarter of 2018, the Company sold its operations in Laos and Tajikistan to external parties, which were previously classified as disposal groups held for sale. The effect of the disposals is detailed below: Laos Tajikistan Other Total Net cash consideration received 22 — — 22 Derecognition of assets classified as held for sale (21 ) (13 ) — (34 ) Derecognition of liabilities classified as held for sale 13 25 10 48 Derecognition of non-controlling interests (6 ) — — (6 ) Release cumulative other comprehensive income related to disposal group 1 (1 ) — — Gain on disposal 9 11 10 30 |
Schedule of information about materially partly-owned subsidiaries | Financial information of subsidiaries that have material non-controlling interests ( “NCIs” ) is provided below: Equity interest Book values of Profit / (loss) attributable to material NCIs Name of significant subsidiary 2018 2017 2018 2017 2018 2017 LLP “KaR-Tel” ( “Kar-Tel” ) 25.0% 25.0% 228 252 19 8 LLC “Sky Mobile” ( “Sky Mobile” ) 49.8% 49.8% 133 167 (32) 3 Global Telecom Holding S.A.E ( “GTH” ) 42.3% 42.3% (1,190) (793) (217) (40) Omnium Telecom Algérie S.p.A. ( “OTA” ) 73.7% 73.7% 1,091 1,235 1 100 |
Schedule of summarized income statement of subsidiaries before inter-company eliminations | Summarized income statement Kar-Tel Sky Mobile GTH OTA 2018 2017 2016 2018 2017 2016 2018 2017* 2016 2018 2017 2016 Operating revenue 410 348 308 81 108 136 2,828 3,015 2,955 813 915 1,040 Operating expenses (319 ) (296 ) (255 ) (144 ) (97 ) (162 ) (2,810 ) (2,421 ) (2,463 ) (754 ) (703 ) (753 ) Other (expenses) / income 6 (7 ) 2 — (2 ) (12 ) (377 ) (450 ) (213 ) (11 ) (27 ) (33 ) Profit / (loss) before tax 97 45 55 (63 ) 9 (38 ) (359 ) 144 279 48 185 254 Income tax expense (20 ) (13 ) (14 ) (1 ) (4 ) (5 ) (124 ) (375 ) (144 ) (47 ) (49 ) (69 ) Profit / (loss) for the year 77 32 41 (64 ) 5 (43 ) (483 ) (231 ) 135 1 136 185 Total comprehensive income / (loss) 77 32 41 (64 ) 5 (43 ) (483 ) (231 ) 135 1 136 185 Attributed to NCIs 19 8 10 (32 ) 3 (21 ) (204 ) (56 ) 116 1 100 141 Dividends paid to NCIs — — — — — — 80 116 — 76 82 — |
Schedule of summarized financial position of subsidiaries before inter-company eliminations | Summarized statement of financial position Kar-Tel Sky Mobile GTH OTA 2018 2017 2018 2017 2018 2017* 2018 2017 Property and equipment 192 184 76 79 1,652 2,166 498 517 Intangible assets 69 92 10 12 1,042 1,324 214 291 Other non-current assets 177 204 55 131 1,766 2,094 1,178 1,361 Trade and other receivables 13 22 3 6 263 260 48 31 Cash and cash equivalents 29 14 43 32 420 385 53 125 Other current assets 15 74 12 12 317 363 88 66 Financial liabilities — — — — (2,938 ) (3,072 ) (63 ) (128 ) Provisions (4 ) (5 ) (2 ) (4 ) (312 ) (348 ) (25 ) (31 ) Other liabilities (85 ) (84 ) (19 ) (22 ) (1,690 ) (1,865 ) (355 ) (400 ) Total equity 406 501 178 246 520 1,307 1,636 1,832 Attributed to: Equity holders of the parent 178 249 45 79 1,710 2,100 545 597 Non-controlling interests 228 252 133 167 (1,190 ) (793 ) 1,091 1,235 |
Schedule of summarized cash flow statement of subsidiaries before inter-company eliminations | Summarized statement of cash flows Kar-Tel Sky Mobile GTH OTA 2018 2017 2016 2018 2017 2016 2018 2017 2016 2018 2017 2016 Net operating cash flows 148 105 99 29 23 58 900 877 1,077 245 345 446 Net investing cash flows (42 ) (73 ) (124 ) (18 ) (24 ) 45 (695 ) (924 ) (473 ) (118 ) (172 ) (238 ) Net financing cash flows (90 ) (48 ) (83 ) — — (115 ) (110 ) (157 ) (492 ) (193 ) (350 ) (288 ) Effect of exchange rate changes on cash and (3 ) — 1 — — (1 ) (60 ) (18 ) (14 ) (5 ) (7 ) (14 ) Net increase / (decrease) in cash equivalents 13 (16 ) (107 ) 11 (1 ) (13 ) 35 (222 ) 98 (71 ) (184 ) (94 ) |
FINANCIAL ASSETS AND LIABILIT_2
FINANCIAL ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of detailed information about financial instruments [abstract] | |
Schedule of financial assets | The Company holds the following financial assets as of December 31 : Carrying value Fair value Financial assets 2018 2017 2018 2017 Financial assets at fair value through profit or loss Derivatives not designated as hedges 14 10 14 10 Derivatives designated as net investment hedges 45 — 45 — Investments in debt instruments * 36 71 36 71 Other 3 — 3 — 98 81 98 81 Financial assets at amortized cost Cash pledged as collateral ** 31 998 31 998 Other investments 17 85 17 85 48 1,083 48 1,083 Total financial assets 146 1,164 146 1,164 Non-current 58 34 Current 88 1,130 * Investments in debt instruments relate primarily to government bonds and are measured at fair value through other comprehensive income (with recycling). Balances in the comparative year were classified as Available for sale financial asset, see Note 25 for further details. ** Amount in 2017 relates to the mandatory tender offer in relation to GTH, which was subsequently withdrawn, see Note 10 for further details. |
Schedule of financial liabilities | The Company holds the following financial liabilities as of December 31 : Carrying value Fair value Financial Liabilities 2018 2017 2018 2017 Financial liabilities at fair value through profit or loss Derivatives not designated as hedges 65 — 65 — Derivatives designated as net investment hedges — 59 — 59 Contingent consideration 40 49 40 49 Other 2 1 2 1 107 109 107 109 Financial liabilities at amortized cost Principal amount outstanding 7,298 11,103 7,349 11,548 Interest accrued 81 129 81 130 Discounts, unamortized fees, hedge basis adjustment (13 ) (34 ) — — Bank loans and bonds 7,366 11,198 7,430 11,678 Put-option liability over non-controlling interest 306 310 306 310 Other financial liabilities 77 13 77 13 7,749 11,521 7,813 12,001 Total financial liabilities 7,856 11,630 7,920 12,110 Non-current 6,567 10,362 Current 1,289 1,268 |
Schedule of principal amounts outstanding for interest-bearing loans and bonds | The Company had the following principal amounts outstanding for interest-bearing loans and bonds at December 31 : Principal amount outstanding Borrower Type of debt Guarantor Currency Interest rate Maturity 2018 2017 VEON Holdings Loans None RUB 8.75% - 10.0% 2022 2,051 2,474 VEON Holdings Notes None US$ 5.2% - 5.95% 2019 -2023 1,100 1,554 VEON Holdings Notes None US$ 3.95% - 4.95% 2021 - 2024 1,133 1,500 VEON Holdings Loans None EUR 3mEURIBOR + 1.9% - 2.75% 2022 — 752 VEON Holdings Notes PJSC VimpelCom US$ 7.5% 2022 417 628 VEON Holdings Syndicated loan (RCF) None US$ 1mLIBOR + 2.25% 2018 — 250 VEON Holdings Notes None RUB 9.0% 2018 — 208 GTH Finance B.V. Notes VEON Holdings B.V. US$ 6.25% - 7.25% 2020 -2023 1,200 1,200 VIP Finance Ireland Eurobonds None US$ 7.748% 2021 262 543 PMCL Loans None PKR 6mKIBOR + 2020 -2022 256 379 PMCL Loans EKN * US$ 6mLIBOR + 2020 137 212 Banglalink Senior Notes None US$ 8.6% 2019 300 300 Banglalink Loans None BDT Average bank deposit rate + 3.0% - 4.25% 2020 - 2022 146 — Other loans 296 1,103 Total bank loans and bonds 7,298 11,103 * Exportkreditnämnden (The Swedish Export Credit Agency) |
Schedule of reconciliation of cash flows from financing activities | Bank loans and bonds at amortized cost 2018 2017 Balance as of January 1 11,198 10,702 Cash flows Proceeds from borrowings, net of fees paid 807 6,193 Repayment of borrowings (4,122 ) (5,948 ) Interest paid (736 ) (834 ) Non-cash movements Interest expense 738 774 Early redemption premium accrued * 44 168 Foreign currency translation (573 ) 138 Other non-cash movements 10 5 Balance as of December 31 7,366 11,198 * Early redemption premium accrued in respect of the settlement of the cash tender offer for certain outstanding debt securities, see below for further information. The amount accrued relates to the excess of purchase price over the principal amount outstanding, which, together with the release of unamortized debt issuance costs and unamortized fair value hedge basis adjustment, resulted in a loss from early debt redemption of US $30 ( 2017 : US $124 ), recorded within “Other non-operating gains/losses” (refer to Note 5). |
Schedule of reconciliation of movements relating to financial instruments classified in level 3 of the fair value hierarchy | The following table summarizes the movements relating to financial instruments classified as Level 3 in the fair value hierarchy for the years ended December 31, 2018 and 2017 : Financial assets at fair value Financial liabilities at fair value Investments in debt instruments Contingent consideration As of January 1, 2017 29 47 Impairment loss (20 ) — Change in fair value recognized in other comprehensive income (9 ) — Change in fair value recognized in the income statement — 2 As of December 31, 2017 — 49 Change in fair value recognized in the income statement — (9 ) As of December 31, 2018 — 40 |
Schedule of hedge accounting with derivatives as hedging items | The following table sets out the Company’s hedging instruments designated as net investment hedges as of December 31 : Hedging instruments* Designated rate Excluded component Hedged Currency Aggregated designated nominal value of hedged items, million 2018 2017 Cross currency interest rate swaps ** Forward foreign currency basis spread Italy Joint Venture EUR — 537 *** Euro-denominated loans ** Spot n/a Italy Joint Venture EUR — 627 Foreign currency forward contracts Forward foreign currency basis spread PJSC VimpelCom RUB 68,639 **** — * Refer to Note 16 for information regarding the carrying amounts of the hedging instruments. ** Hedging relationships were terminated due to disposal of the hedged item. Refer to Note 10 for further details. *** Exchanged to US $600 at maturity on June 16, 2021. **** Hedging instruments have a weighted average term to maturity of 2 years as of December 31, 2018 . The below table sets out the reconciliation of each component of equity and the analysis of other comprehensive income: Foreign currency translation reserve Cost of hedging reserve As of January 1, 2017 (7,109 ) — Foreign currency revaluation of the foreign operations and other (433 ) — Effective portion of foreign currency revaluation of the hedging instruments * (125 ) — As of December 31, 2017 (7,667 ) — Foreign currency revaluation of the foreign operations (753 ) — Effective portion of foreign currency revaluation of the hedging instruments * 83 — Change in fair value of foreign currency basis spreads — (4 ) Amortization of time-period related foreign currency basis spreads — 5 Net investment hedge amount reclassified to profit or loss – sale of Italy Joint Venture 80 4 Disposal of subsidiaries – reclassification to profit or loss (159 ) — As of December 31, 2018 (8,416 ) 5 * Amounts represent the changes in fair value of the hedging financial instruments and closely approximate the changes in value of the hedged items used to recognize hedge ineffectiveness. |
Schedule of offsetting financial assets and liabilities | Related amounts not set off in the statement of financial position Gross amounts recognized Gross amounts set off in the statement of financial position Net amounts presented in the statement of financial position Financial instruments Cash collateral received Net amount As of December 31, 2018 Other financial assets (non-current) 58 — 58 — — 58 Other financial liabilities (non-current) 6,567 — 6,567 — — 6,567 Other financial assets (current) 88 — 88 — — 88 Other financial liabilities (current) 1,289 — 1,289 — — 1,289 Trade and other receivables 617 (40 ) 577 — — 577 Trade and other payables 1,472 (40 ) 1,432 — — 1,432 As of December 31, 2017 Other financial assets (non-current) 34 — 34 — — 34 Other financial liabilities (non-current) 10,362 — 10,362 — — 10,362 Other financial assets (current) 1,130 — 1,130 — — 1,130 Other financial liabilities (current) 1,268 — 1,268 — — 1,268 Trade and other receivables 817 (72 ) 745 — — 745 Trade and other payables 1,595 (72 ) 1,523 — — 1,523 |
CASH AND CASH EQUIVALENTS (Tabl
CASH AND CASH EQUIVALENTS (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Cash and cash equivalents [abstract] | |
Schedule of cash and cash equivalents | Cash and cash equivalents consisted of the following items as of December 31 : December 31, 2018 December 31, 2017 Cash and cash equivalents at banks and on hand 756 850 Cash equivalents with original maturity of less than three months 1,052 464 Cash and cash equivalents 1,808 1,314 Less overdrafts (17 ) — Cash and cash equivalents, net of overdrafts, as presented in the consolidated statement of cash flows 1,791 1,314 |
FINANCIAL RISK MANAGEMENT (Tabl
FINANCIAL RISK MANAGEMENT (Tables) | 3 Months Ended |
Dec. 31, 2018 | |
Disclosure of risk management strategy related to hedge accounting [abstract] | |
Schedule of sensitivity analysis | Effect on profit / (loss) before tax Effect on other comprehensive income Change in foreign exchange rate against US$ 10% depreciation 10% appreciation 10% depreciation 10% appreciation 2018 Euro (2) 3 — — Russian Ruble (32) 35 70 (77) Bangladeshi Taka (76) 83 — — Pakistani Rupee (19) 20 — — Georgian Lari (34) 37 — — Other currencies — — — — 2017 Euro (18) 20 132 (145) Russian Ruble 44 (48) — — Bangladeshi Taka (69) 76 — — Pakistani Rupee (27) 30 — — Georgian Lari (32) 35 — — Other currencies (11) 12 — — |
Schedule of available facilities for liquidity risk | The Company had the following available facilities as of balance sheet date for the years indicated below: Amounts in millions of transactional currency US$ equivalent amounts Final availability period Facility amount Utilized Available Facility amount Utilized Available 2018 VEON Holdings B.V. – Revolving Credit Facility Feb 2022 US$1,688* — US$1,688 1,688 — 1,688 Pakistan Mobile Communications Limited - Syndicated Term Loan Facility Jun 2019 PKR 26,750 PKR 17,000 PKR 9,750 191 122 69 Pakistan Mobile Communications Limited - Term Loan Facility Jun 2019 PKR 10,000 PKR 5,463 PKR 4,537 72 39 33 * Facility amount of US $1,688 is available until February 2020. Subsequently a reduced facility amount of US $1,586 is available until February 2021 and further reduced facility amount of US $1,382 is available until February 2022 Amounts in millions of transactional currency US$ equivalent amounts Final availability period Facility amount Utilized Available Facility amount Utilized Available 2017 VEON Holdings B.V. – Revolving Credit Facility * Feb 2021 US$1,688 US$250 US$1,438 1,688 250 1,438 VEON Holdings B.V. – Term Loan Facility May 2018 RUB 45,000 RUB 30,000 RUB 15,000 781 520 261 Banglalink Digital Communications Ltd. – Syndicated Term Loan Facility Sep 2018 BDT 29,300 — BDT 29,300 353 — 353 Pakistan Mobile Communications Limited - Syndicated Term Loan Facility Jun 2018 PKR 26,750 PKR 17,000 PKR 9,750 242 154 88 Pakistan Mobile Communications Limited - Term Loan Facility Jun 2018 PKR 10,000 PKR 5,000 PKR 5,000 90 45 45 * Facility amount of US $1,688 is available until February 2020. Subsequently a reduced facility amount of US $1,586 is available until February 2021. |
Schedule of maturity analysis of financial liabilities | The table below summarizes the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments. Payments related to variable interest rate financial liabilities and derivatives are included based on the interest rates and foreign currency exchange rates applicable as of December 31, 2018 and 2017 , respectively. The total amounts in the table differ from the carrying amounts as stated in Note 16 as the below table includes both undiscounted principal amounts and interest while the carrying amounts are measured using the effective interest rate method. Less than 1 year 1-3 years 3-5 years More than 5 years Total At December 31, 2018 Bank loans and bonds 1,697 3,866 2,642 579 8,784 Derivative financial liabilities Gross cash inflows (368 ) (54 ) — — (422 ) Gross cash outflows 394 68 — — 462 Trade and other payables 1,425 — — — 1,425 Other financial liabilities — 62 — — 62 Warid non-controlling interest put option liability — 306 — — 306 Total financial liabilities 3,148 4,248 2,642 579 10,617 Related derivatives financial assets Gross cash inflows (300 ) (610 ) (330 ) — (1,240 ) Gross cash outflows 286 634 354 — 1,274 Related derivative financial assets (14 ) 24 24 — 34 Total financial liabilities, net of derivative assets 3,134 4,272 2,666 579 10,651 Less than 1 year 1-3 years 3-5 years More than 5 years Total At December 31, 2017 Bank loans and bonds 1,862 4,141 4,958 2,774 13,735 Derivative financial liabilities Gross cash inflows (37 ) (49 ) (12 ) — (98 ) Gross cash outflows 29 27 51 — 107 Trade and other payables 1,523 — — — 1,523 Other financial liabilities — 62 — — 62 Warid non-controlling interest put option liability — 310 — — 310 Total financial liabilities 3,377 4,491 4,997 2,774 15,639 Related derivatives financial assets Gross cash inflows (275 ) — — — (275 ) Gross cash outflows 270 — — — 270 Related derivative financial assets (5 ) — — — (5 ) Total financial liabilities, net of derivative assets 3,372 4,491 4,997 2,774 15,634 |
ISSUED CAPITAL AND RESERVES (Ta
ISSUED CAPITAL AND RESERVES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
ISSUED CAPITAL AND RESERVES | |
Summary of common shares | The following table details the common shares of the Company as of December 31 : 2018 2017 Authorized common shares (nominal value of US$0.001 per share) 1,849,190,670 2,759,171,830 Issued shares 1,756,731,135 1,756,731,135 Treasury shares (7,603,731 ) (7,603,731 ) Outstanding shares 1,749,127,404 1,749,127,404 |
Summary of major shareholders | As of December 31, 2018 , the Company’s largest shareholders and remaining free float are as follows: Shareholder Common shares % of common and voting shares L1T VIP Holdings S.à r.l. (“ LetterOne ”) 840,625,001 47.9 % Telenor East Holding II AS (“ Telenor ”) 256,703,840 14.6 % Stichting Administratiekantoor Mobile Telecommunications Investor * 145,947,562 8.3 % Free Float 513,454,732 29.6 % Shares held by the Company or its subsidiaries ( “Treasury shares” ) (7,603,731 ) (0.40 )% Total outstanding common shares 1,749,127,404 100 % * LetterOne is the holder of the depositary receipts issued by Stichting and is therefore entitled to the economic benefits (dividend payments, other distributions and sale proceeds) of such depositary receipts and, indirectly, of the 145,947,562 common shares represented by the depositary receipts. According to the conditions of administration entered into between Stichting and LetterOne ( “Conditions of Administration” ) in connection with the transfer of 145,947,562 ADSs from LetterOne to Stichting on March 29, 2016, Stichting has the power to vote and direct the voting of, and the power to dispose and direct the disposition of, the ADSs, in its sole discretion, in accordance with the Conditions of Administration and Stichting’s articles of association. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Earnings per share [abstract] | |
Schedule of earnings per share for continuing operations | The following table sets forth the computation of basic and diluted earnings per share ( “EPS” ) for continuing operations, for the years ended December 31 : Continuing operations 2018 2017 2016 (In millions of U.S. dollars, except share and per share amounts) Numerator: Profit / (loss) for the period attributable to the owners of the parent (397 ) (115 ) (439 ) Denominator: Weighted average common shares outstanding for basic earnings per share (in millions) 1,749 1,749 1,749 Denominator for diluted earnings per share (in millions) 1,749 1,749 1,749 Basic (loss) / earnings per share ($0.23 ) ($0.07 ) ($0.25 ) Diluted (loss) / earnings per share ($0.23 ) ($0.07 ) ($0.25 ) |
Schedule of earnings per share for discontinuing operations | The following table sets forth the computation of basic and diluted earnings per share ( “EPS” ) for discontinued operations, for the years ended December 31 : Discontinued operations 2018 2017 2016 (In millions of U.S. dollars, except share and per share amounts) Numerator: Profit / (loss) for the period attributable to the owners of the parent 979 (390 ) 2,767 Denominator: Weighted average common shares outstanding for basic earnings per share (in millions) 1,749 1,749 1,749 Denominator for diluted earnings per share (in millions) 1,749 1,749 1,749 Basic (loss) / earnings per share $0.56 ($0.22 ) $1.58 Diluted (loss) / earnings per share $0.56 ($0.22 ) $1.58 |
DIVIDENDS PAID AND PROPOSED (Ta
DIVIDENDS PAID AND PROPOSED (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
DIVIDENDS PAID AND PROPOSED | |
Schedule of dividends | Following table provides an overview of the dividends announced by VEON for years 2018 and 2017 : Description Dividends declared Payment date Dividends, US$ cents per share Final for 2018 February 25, 2019 Expected March 20, 2019 17 Interim for 2018 August 2, 2018 August 20, 2018 12 Final for 2017 February 22, 2018 March 13, 2018 17 Interim for 2017 August 3, 2017 September 6, 2017 11 |
Schedule of declared dividends paid or payable to non-controlling interests | During the 2018 and 2017 years, certain subsidiaries of the Company declared dividends, of which a portion was paid or payable to non-controlling interests. Name of subsidiary Dividend declared Dividend paid Paid or payable to non-controlling interests Omnium Telecom Algeria S.p.A June 21, 2018 August 29, 2018 76 TNS Plus LLP April 19, 2018 August 29, 2018 2 Rascom CJSC June 27, 2018 July 24, 2018 2 TNS Plus LLP April 19, 2018 April 23, 2018 11 VIP Kazakhstan Holding AG October 6, 2017 October 10, 2017 11 Omnium Telecom Algeria S.p.A June 21, 2017 August 18, 2017 82 TNS Plus LLP May 12, 2017 May 15, 2017 12 VIP Kyrgyzstan Holding AG February 13, 2017 February 16, 2017 55 TNS Plus LLP January 24, 2017 January 25, 2017 7 |
RELATED PARTIES (Tables)
RELATED PARTIES (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of transactions between related parties [abstract] | |
Schedule of compensation paid to key management personnel | The following table sets forth the total compensation paid to our directors and senior managers: 2018 2017 2016 Short-term employee benefits 33 42 37 Long-term employee benefits — 1 — Share-based payments — 1 — Termination benefits 2 1 4 Total compensation to directors and senior management * 35 45 41 *The number of directors and senior managers vary from year to year. Amounts disclosed in previous years for ‘Long-term employee benefits’ represented total nominal values of the grants covering multiple years. |
Schedule of compensation paid to key management board members | The following table sets forth the total compensation paid to the key senior managers in 2018 and 2017 (gross amounts in whole euro and whole US$ equivalents): Ursula Burns Jean-Yves Charlier Trond Westlie Andrew Davies Kjell Johnsen Scott Dresser Group CEO and Chairman (iii) Former Group CEO (iv) Group CFO (v) Former Group CFO (v) Group COO Group General Counsel EUR US$ EUR US$ EUR US$ EUR US$ EUR US$ EUR US$ 2018 Short-term employee benefits Base salary (i) 4,602,902 5,429,871 1,902,600 2,244,426 1,500,000 1,769,494 — — 1,425,000 1,681,019 1,233,333 1,454,917 Annual incentive (ii) — — 7,717,900 9,104,518 127,313 150,186 — — — — 405,899 478,824 Other 104,645 123,446 489,070 576,938 21,695 25,593 — — 70,442 83,098 927,489 1,094,124 Long-term employee benefits — — — — — — — — — — — — Share-based payments — — — — — — — — — — — — Termination benefits — — 1,340,278 1,581,076 — — — — — — — — Total gross remuneration 4,707,547 5,553,317 11,449,848 13,506,958 1,649,008 1,945,273 — — 1,495,442 1,764,117 2,566,721 3,027,865 2017 Short-term employee benefits Base salary (i) — — 2,500,000 2,819,125 375,000 422,869 1,125,000 1,268,606 — — 925,000 1,043,076 Annual incentive (ii) — — 4,125,000 4,651,556 — — 3,518,295 3,967,405 — — 977,272 1,102,021 Other — — 91,916 103,649 5,400 6,089 1,284,248 1,448,182 — — 31,186 35,166 Long-term employee benefits — — — — — — — — — — — — Share-based payments — — 709,661 800,249 — — — — — — — — Termination benefits — — — — — — 250,000 281,912 — — — — Total gross remuneration — — 7,426,577 8,374,579 380,400 428,958 6,177,543 6,966,105 — — 1,933,458 2,180,263 (i) Base salary includes holiday and/or pension allowances pursuant to the terms of an individual’s employment agreement. (ii) Annual Incentive includes amounts paid under the short-term incentive in respect of performance during the previous year, except for amounts shown for Jean-Yves Charlier during 2018, which also Andrew Davies during 2017, which also includes amounts paid under the STI Scheme in respect of performance during the current year. (iii) Includes total compensation paid to Ursula Burns in respect of her roles as Chairman of the VEON Ltd. board of directors through March 26, 2018, Executive Chairman and Chairman of the VEON Ltd. board of directors from March 27, 2018 to December 11, 2018, and as newly appointed Group CEO and Chairman of the VEON Ltd. board of directors from December 12, 2018. (iv) Jean-Yves Charlier stepped down from the role of Group CEO on March 27, 2018. (v) Andrew Davies stepped down from the role of Group CFO, and Trond Westlie commenced duties as newly appointed Group CFO on November 9, 2017. |
Schedule of compensation paid to supervisory board members | The awards launched under the LTI Plan are detailed below. Tranche Grant date Performance period KPIs based on Other information 2015 Tranche March 2016 January 1, 2015 to June 30, 2018 (42 months) TSR evolution compared to peer companies in the markets in which VEON operates The Compensation Committee regularly reviews the peer group to ensure that its composition is still appropriate. 2016 Tranche October 2017 January 1, 2016 to June 30, 2019 (42 months) TSR evolution compared to peer companies in the markets in which VEON operates The Compensation Committee regularly reviews the peer group to ensure that its composition is still appropriate. 2017 Tranche October 2017 January 1, 2017 to June 30, 2020 (42 months) Absolute share price performance target KPIs designed to create a direct link between management focus and real return to shareholders. 2018 Tranche July 2018 July 1, 2017 to December 31, 2020 (42 months) Absolute share price performance target KPIs designed to create a direct link between management focus and real return to shareholders. The following table sets forth the total compensation paid to the members of the Board of Directors members in 2018 and 2017 (gross amounts in whole euro and whole US$ equivalents): Retainer Committees Other compensation Total 2018 2017 2018 2017 2018 2017 2018 2017 Guillaume Bacuvier In whole euro 105,000 — 21,000 — — — 126,000 — US$ equivalent 123,869 — 24,774 — — — 148,643 — Osama Bedier In whole euro 105,000 — 10,500 — — — 115,500 — US$ equivalent 123,869 — 12,387 — — — 136,256 — Ursula Burns In whole euro * — 436,213 — 12,500 — 1,517,500 — 1,966,213 US$ equivalent * — 491,896 — 14,096 — 1,711,209 — 2,217,201 Stan Chudnovsky In whole euros 145,833 193,918 — — — — 145,833 193,918 US$ equivalent 172,039 218,672 — — — — 172,039 218,672 Mikhail Fridman In whole euro 40,000 40,000 — — — — 40,000 40,000 US$ equivalent 47,188 45,106 — — — — 47,188 45,106 Gennady Gazin In whole euro 250,000 194,048 65,500 55,000 — 4,757 315,500 253,805 US$ equivalent 294,925 218,818 77,270 62,021 — 5,364 372,195 286,203 Andrei Gusev In whole euro 40,000 40,000 — — — — 40,000 40,000 US$ equivalent 47,188 45,106 — — — — 47,188 45,106 Gunnar Holt In whole euro 250,000 133,950 50,000 20,833 — — 300,000 154,783 US$ equivalent 294,925 151,049 58,985 23,492 — — 353,910 174,541 Sir Julian Horn-Smith In whole euro 250,000 194,048 10,500 — — 5,145 260,500 199,193 US$ equivalent 294,925 218,818 12,387 — — 5,802 307,312 224,620 Nils Katla In whole euro — 36,666 — — — — — 36,666 US$ equivalent — 41,346 — — — — — 41,346 Jørn P. Jensen In whole euro 163,333 195,538 — 30,000 — — 163,333 225,538 US$ equivalent 192,684 220,498 — 33,829 — — 192,684 254,327 Robert Jan van de Kraats In whole euro 105,000 — 12,600 — — — 117,600 — US$ equivalent 123,869 — 14,864 — — — 138,733 — Guy Laurence In whole euro 250,000 110,619 41,600 20,833 16,250 1,250 307,850 132,702 US$ equivalent 294,925 124,740 49,076 23,492 19,170 1,410 363,171 149,642 Alexander Pertsovsky In whole euro 40,000 — — — — — 40,000 — US$ equivalent 47,188 — — — — — 47,188 — Alexey M. Reznikovich In whole euro — 40,000 — — — — — 40,000 US$ equivalent — 45,106 — — — — — 45,106 Total (in whole euro) 1,744,166 1,615,000 211,700 139,166 16,250 1,528,652 1,972,116 3,282,818 Total (US$ equivalent) 2,057,594 1,821,155 249,743 156,930 19,170 1,723,785 2,326,507 3,701,870 * Ursula Burns was appointed Group CEO and Chairman of the VEON Ltd. board of directors on December 12, 2018. Accordingly, her total compensation for 2018 has been included in the section “Compensation of Key Senior Managers” above. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE (Tables) | 12 Months Ended |
Dec. 31, 2018 | |
Disclosure of initial application of standards or interpretations [line items] | |
Disclosure of significant accounting judgments, estimates and assumptions | The sources of uncertainty identified by the Group are described together with the applicable Note, as follows: Significant accounting judgement / source of estimation uncertainty Described in Revenue recognition Note 3 Deferred tax assets and uncertain tax positions Note 8 and Note 9 Provisions Note 8 Impairment of non-current assets Note 11 Control over subsidiaries Note 15 Depreciation and amortization of non-current assets Note 12 and Note 13 Fair value of financial instruments Note 16 |
Reconciliation of operating lease commitments to lease liabilities | The following table reconciles the Company’s operating lease commitments as of December 31, 2018 , to the lease liabilities expected to be recognized upon initial application of IFRS 16 on January 1, 2019. US$ Operating lease commitments as of December 31, 2018 (see Note 4) 632 Increase in lease commitments of cancellable leases included in reasonably certain lease term 1,846 Use of IFRS 16 practical expedients (old lease accounting continues for exceptions) (4 ) Leases commencing subsequent to transition date committed to as of December 31, 2018 (47 ) Accruals included in the lease liability calculation 59 Other 22 Total undiscounted lease payments which are reasonably certain 2,508 Discounting effect using incremental borrowing rate (559 ) IAS 17 finance lease liabilities recognized on balance sheet as of December 31, 2018 (discounted) 54 Expected IFRS 16 Lease liability recognized on balance sheet as of January 1, 2019 2,003 Expected IFRS 16 lease liability presented as Non-current 1,638 Current 361 Liabilities associated with assets held for sale 4 2,003 |
Increase (decrease) due to application of IFRS 15 | |
Disclosure of initial application of standards or interpretations [line items] | |
Schedule of the impact that adoption of IFRS 9 and IFRS 15 is expected to have on the opening balance sheet of the Group | The following table presents the transitional impact that adoption of IFRS 9, ‘ Financial Instruments ’ ( “IFRS 9 ”) and IFRS 15, ‘Revenue from contracts with customers’ ( “IFRS 15” ) had on the opening balance sheet of the Group, as of January 1, 2018. Further details regarding the impact of IFRS 9 and IFRS 15 can be found below. December 31, 2017* Impact of IFRS 9 Impact of IFRS 15 Classification and measurement Impairment Revenue and customer acquisition costs January 1, 2018 Assets Non-current assets Investments in joint ventures and associates 1,921 (25 ) (10 ) 38 1,924 Deferred tax assets 336 — 2 (12 ) 326 Other financial assets Available for sale 18 (18 ) — — — Fair value through other comprehensive income — 18 — — 18 Other assets 263 — — 93 356 Current assets Trade and other receivables Trade and other receivables, gross 924 — — — 924 Allowance for doubtful debt (169 ) — (14 ) (183 ) Other financial assets Available for sale 53 (53 ) — — — Fair value through profit or loss 20 20 Fair value through other comprehensive income — 33 — — 33 Other assets 418 — — (4 ) 414 Equity Equity attributable to equity owners of the parent 4,331 (25 ) (16 ) 87 4,377 Non-controlling interests (441 ) — (4 ) 15 (430 ) Liabilities Other liabilities (current) 1,353 — — (1 ) 1,352 Deferred tax liabilities 376 — (2 ) 14 388 * Opening balance sheet numbers are represented following retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (Note 10) |
Impact of IFRS 16 | |
Disclosure of initial application of standards or interpretations [line items] | |
Schedule of the impact that adoption of IFRS 9 and IFRS 15 is expected to have on the opening balance sheet of the Group | During 2018, the Group has performed a detailed impact assessment of IFRS 16. In summary the impact of IFRS 16 adoption is expected to be, as follows: December 31, 2018 Impact of IFRS 16 January 1, 2019 Assets Non-current assets Property and equipment Property and equipment 4,932 (71 ) 4,861 Right-of-use assets — 2,023 2,023 Intangible assets 1,854 (15 ) 1,839 Goodwill 3,816 — 3,816 Deferred tax assets 197 — 197 Other financial assets 193 (1 ) 192 Total non-current assets 10,992 1,936 12,928 Current assets Trade and other receivables 577 (61 ) 516 Other current assets 2,516 — 2,516 Total current assets 3,093 (61 ) 3,032 Assets classified as held for sale 17 4 21 Total assets 14,102 1,879 15,981 Equity Equity attributable to equity owners of the parent 3,670 (3 ) 3,667 Non-controlling interest (891 ) (1 ) (892 ) Total equity 2,779 (4 ) 2,775 Non-current liabilities Financial liabilities 6,567 (45 ) 6,522 Provisions 110 — 110 Lease liabilities — 1,638 1,638 Deferred tax liabilities 180 — 180 Other liabilities 53 (9 ) 44 Total non-current liabilities 6,910 1,584 8,494 Current liabilities Trade and other payables 1,432 (54 ) 1,378 Other financial liabilities 1,289 (6 ) 1,283 Lease liabilities — 361 361 Provisions 398 (3 ) 395 Other liabilities 1,290 (3 ) 1,287 Total current liabilities 4,409 295 4,704 Liabilities associated with assets held for sale 4 4 8 Total equity and liabilities 14,102 1,879 15,981 |
GENERAL INFORMATION (Details)
GENERAL INFORMATION (Details) | Jul. 03, 2018 |
Italy Joint Venture | Discontinued operations | |
General information | |
Proportion of ownership interest in joint venture | 50.00% |
SEGMENT INFORMATION - Reportabl
SEGMENT INFORMATION - Reportable Segments (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
SEGMENT INFORMATION | |||||
Revenue | $ 9,086 | $ 9,474 | [1] | $ 8,885 | [1] |
Adjusted EBITDA | 3,273 | 3,587 | 3,232 | ||
Capital expenditures excluding licenses | 1,415 | 1,460 | 1,592 | ||
Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 9,086 | 9,474 | 8,885 | ||
Russia | |||||
SEGMENT INFORMATION | |||||
Revenue | 4,654 | 4,729 | 4,097 | ||
Adjusted EBITDA | 1,677 | 1,788 | 1,574 | ||
Capital expenditures excluding licenses | 742 | 667 | 643 | ||
Russia | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 4,632 | 4,698 | 4,059 | ||
Russia | Inter-segment | |||||
SEGMENT INFORMATION | |||||
Revenue | 22 | 31 | 38 | ||
Pakistan | |||||
SEGMENT INFORMATION | |||||
Revenue | 1,494 | 1,525 | 1,295 | ||
Adjusted EBITDA | 714 | 703 | 507 | ||
Capital expenditures excluding licenses | 199 | 240 | 215 | ||
Pakistan | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 1,481 | 1,525 | 1,293 | ||
Pakistan | Inter-segment | |||||
SEGMENT INFORMATION | |||||
Revenue | 13 | 2 | |||
Algeria | |||||
SEGMENT INFORMATION | |||||
Revenue | 813 | 915 | 1,040 | ||
Adjusted EBITDA | 363 | 426 | 547 | ||
Capital expenditures excluding licenses | 107 | 132 | 165 | ||
Algeria | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 810 | 914 | 1,040 | ||
Algeria | Inter-segment | |||||
SEGMENT INFORMATION | |||||
Revenue | 3 | 1 | |||
Bangladesh | |||||
SEGMENT INFORMATION | |||||
Revenue | 521 | 574 | 621 | ||
Adjusted EBITDA | 183 | 233 | 267 | ||
Capital expenditures excluding licenses | 93 | 101 | 137 | ||
Bangladesh | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 521 | 574 | 621 | ||
Ukraine | |||||
SEGMENT INFORMATION | |||||
Revenue | 688 | 622 | 586 | ||
Adjusted EBITDA | 387 | 347 | 306 | ||
Capital expenditures excluding licenses | 115 | 98 | 104 | ||
Ukraine | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 663 | 600 | 566 | ||
Ukraine | Inter-segment | |||||
SEGMENT INFORMATION | |||||
Revenue | 25 | 22 | 20 | ||
Uzbekistan | |||||
SEGMENT INFORMATION | |||||
Revenue | 315 | 513 | 663 | ||
Adjusted EBITDA | 136 | 261 | 395 | ||
Capital expenditures excluding licenses | 39 | 63 | 174 | ||
Uzbekistan | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 314 | 513 | 662 | ||
Uzbekistan | Inter-segment | |||||
SEGMENT INFORMATION | |||||
Revenue | 1 | 1 | |||
HQ | |||||
SEGMENT INFORMATION | |||||
Revenue | 10 | ||||
Adjusted EBITDA | (357) | (325) | (421) | ||
Capital expenditures excluding licenses | 11 | 31 | 24 | ||
HQ | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 10 | ||||
Others | |||||
SEGMENT INFORMATION | |||||
Revenue | 601 | 596 | 573 | ||
Adjusted EBITDA | 170 | 154 | 57 | ||
Capital expenditures excluding licenses | 109 | 128 | 130 | ||
Others | Reportable segments | |||||
SEGMENT INFORMATION | |||||
Revenue | 665 | 650 | 634 | ||
Others | Inter-segment | |||||
SEGMENT INFORMATION | |||||
Revenue | $ (64) | $ (54) | $ (61) | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SEGMENT INFORMATION - Segments
SEGMENT INFORMATION - Segments Adjusted EBITDA (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Revenue | |||||
Total Segments Adjusted EBITDA | $ 3,273 | $ 3,587 | $ 3,232 | ||
Depreciation | (1,339) | (1,491) | [1] | (1,439) | [1] |
Amortization | (495) | (537) | [1] | (497) | [1] |
Impairment (loss) / reversal | (858) | (66) | (192) | ||
Gain / (loss) on disposal of non-current assets | (57) | (26) | [1] | (20) | [1] |
Gain / (loss) on disposal of subsidiaries | 30 | 0 | [1] | 0 | [1] |
Finance costs | (816) | (935) | [1] | (830) | [1] |
Finance income | 67 | 95 | [1] | 69 | [1] |
Other non-operating gain / (loss), net | (68) | (97) | [1] | (82) | [1] |
Share of loss of joint ventures and associates | 0 | (22) | [1] | (11) | [1] |
Impairment of joint ventures and associates | 0 | (110) | [1] | (99) | [1] |
Net foreign exchange gain / (loss) | 15 | (70) | [1],[2] | 157 | [1],[2] |
Profit / (loss) before tax from continuing operations | $ (248) | $ 328 | [1],[2] | $ 288 | [1],[2] |
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[2] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SEGMENT INFORMATION - Geographi
SEGMENT INFORMATION - Geographical information of non-current assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | |
Geographical information of non-current assets | |||
Non-current assets | $ 10,992 | $ 15,543 | [1] |
Russia | |||
Geographical information of non-current assets | |||
Non-current assets | 4,794 | 5,969 | |
Pakistan | |||
Geographical information of non-current assets | |||
Non-current assets | 1,661 | 2,270 | |
Algeria | |||
Geographical information of non-current assets | |||
Non-current assets | 1,890 | 2,151 | |
Bangladesh | |||
Geographical information of non-current assets | |||
Non-current assets | 773 | 988 | |
Ukraine | |||
Geographical information of non-current assets | |||
Non-current assets | 748 | 552 | |
Uzbekistan | |||
Geographical information of non-current assets | |||
Non-current assets | 211 | 213 | |
HQ | |||
Geographical information of non-current assets | |||
Non-current assets | 17 | 55 | |
Other | |||
Geographical information of non-current assets | |||
Non-current assets | $ 898 | $ 3,345 | |
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
OPERATING REVENUE - Revenue (De
OPERATING REVENUE - Revenue (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | $ 8,366 | $ 8,688 | $ 8,089 | ||
Fixed line | 720 | 786 | 796 | ||
Total operating revenue | 9,086 | 9,474 | [1] | 8,885 | [1] |
Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 9,086 | 9,474 | 8,885 | ||
Russia | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | 4,085 | 4,053 | 3,430 | ||
Fixed line | 569 | 676 | 667 | ||
Total operating revenue | 4,654 | 4,729 | 4,097 | ||
Russia | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 4,632 | 4,698 | 4,059 | ||
Pakistan | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | 1,494 | 1,525 | 1,295 | ||
Total operating revenue | 1,494 | 1,525 | 1,295 | ||
Pakistan | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 1,481 | 1,525 | 1,293 | ||
Algeria | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | 813 | 915 | 1,040 | ||
Total operating revenue | 813 | 915 | 1,040 | ||
Algeria | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 810 | 914 | 1,040 | ||
Bangladesh | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | 521 | 574 | 621 | ||
Total operating revenue | 521 | 574 | 621 | ||
Bangladesh | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 521 | 574 | 621 | ||
Ukraine | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | 644 | 581 | 545 | ||
Fixed line | 44 | 41 | 41 | ||
Total operating revenue | 688 | 622 | 586 | ||
Ukraine | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 663 | 600 | 566 | ||
Uzbekistan | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | 313 | 510 | 659 | ||
Fixed line | 2 | 3 | 4 | ||
Total operating revenue | 315 | 513 | 663 | ||
Uzbekistan | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 314 | 513 | 662 | ||
HQ | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Fixed line | 10 | ||||
Total operating revenue | 10 | ||||
HQ | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | 10 | ||||
Others | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Mobile | 496 | 530 | 499 | ||
Fixed line | 105 | 66 | 74 | ||
Total operating revenue | 601 | 596 | 573 | ||
Others | Reportable segments | |||||
Revenue from rendering of telecommunication services [abstract] | |||||
Total operating revenue | $ 665 | $ 650 | $ 634 | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
OPERATING REVENUE - Assets and
OPERATING REVENUE - Assets and liabilities arising from contracts with customers (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Revenue [abstract] | ||
Receivables (billed) | $ 673 | $ 780 |
Contract assets (unbilled) | 43 | 18 |
Contract liabilities | (161) | (157) |
Customer acquisition costs | $ 83 | $ 93 |
SELLING, GENERAL AND ADMINIST_2
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Selling, general and administrative expense [abstract] | |||||
Network and IT costs | $ 1,176 | $ 1,185 | $ 1,043 | ||
Personnel costs | 889 | 927 | 775 | ||
Customer associated costs | 867 | 893 | 822 | ||
Losses on receivables | 62 | 59 | 58 | ||
Taxes, other than income taxes | 217 | 219 | 244 | ||
Other | 486 | 465 | 726 | ||
Total selling, general and administrative expenses | $ 3,697 | 3,748 | [1] | $ 3,668 | [1] |
Reduction in selling, general and administrative expense | $ 106 | ||||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SELLING, GENERAL AND ADMINIST_3
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES - Operating Leases (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of operating lease commitments [line items] | |||
Operating lease expense | $ 425 | $ 444 | $ 408 |
Total commitments | 632 | 466 | |
Less than 1 year | |||
Disclosure of operating lease commitments [line items] | |||
Total commitments | 102 | 70 | |
Between 1 and 3 years | |||
Disclosure of operating lease commitments [line items] | |||
Total commitments | 211 | 151 | |
Between 3 and 5 years | |||
Disclosure of operating lease commitments [line items] | |||
Total commitments | 139 | 78 | |
More than 5 years | |||
Disclosure of operating lease commitments [line items] | |||
Total commitments | $ 180 | $ 167 |
OTHER NON-OPERATING LOSSES, N_3
OTHER NON-OPERATING LOSSES, NET (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
OTHER NON-OPERATING LOSSES, NET | |||||
Loss from early debt redemption | $ (30) | $ (124) | $ 0 | ||
Change of fair value of other derivatives | (58) | (13) | (120) | ||
Impairment loss of other financial assets | (2) | (20) | 0 | ||
Gains relating to past acquisitions and divestments | 4 | 70 | 21 | ||
Other gains / (losses) | 18 | (10) | 17 | ||
Other non-operating gain / (loss), net | $ (68) | (97) | [1] | $ (82) | [1] |
Net gain of indemnification from a past business acquisition | 45 | ||||
Gain from sale of investment in subsidiaries | $ 25 | ||||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
TRADE AND OTHER RECEIVABLES (De
TRADE AND OTHER RECEIVABLES (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Jan. 01, 2017 | Dec. 31, 2016 | Jan. 01, 2016 | |
Trade and other current receivables [abstract] | |||||||
Trade receivables (gross) | $ 716 | $ 798 | $ 769 | ||||
Allowance for doubtful debt | (171) | $ (183) | (169) | $ (160) | (160) | $ (182) | |
Trade receivables (net) | 545 | 629 | 609 | ||||
Other receivables | 32 | 126 | 76 | ||||
Total trade and other receivables | $ 577 | $ 755 | [1] | $ 685 | |||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
TRADE AND OTHER RECEIVABLES - M
TRADE AND OTHER RECEIVABLES - Movements in the allowance for doubtful debt (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of initial application of standards or interpretations [line items] | |||
Balance as at January 1 | $ 169 | $ 160 | |
Allowance for doubtful debts | 47 | 36 | $ 73 |
Recoveries | (17) | (9) | (5) |
Accounts receivable written off | (18) | (13) | (44) |
Acquisitions and divestments of subsidiaries | 0 | 0 | (48) |
Foreign currency translation adjustment | (15) | (4) | 2 |
Other movements | (9) | (1) | 0 |
Balance as of December 31 | 171 | 169 | $ 160 |
Impact of Adoption of IFRS 9 and IFRS 15 | December 31, 2018 | |||
Disclosure of initial application of standards or interpretations [line items] | |||
Balance as at January 1 | $ 169 | ||
Balance as of December 31 | $ 169 |
TRADE AND OTHER RECEIVABLES - A
TRADE AND OTHER RECEIVABLES - Aging of trade receivables (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 |
Aging of trade receivables | ||
Trade receivables | $ 545 | $ 615 |
Cost | ||
Aging of trade receivables | ||
Trade receivables | 716 | 798 |
Expected credit losses | ||
Aging of trade receivables | ||
Trade receivables | $ (171) | $ (183) |
Contract assets | ||
Aging of trade receivables | ||
Expected loss rate, % | 0.20% | 1.10% |
Trade receivables | $ 43 | $ 18 |
Contract assets | Cost | ||
Aging of trade receivables | ||
Trade receivables | 44 | 18 |
Contract assets | Expected credit losses | ||
Aging of trade receivables | ||
Trade receivables | $ (1) | $ 0 |
Trade receivables | ||
Aging of trade receivables | ||
Expected loss rate, % | 1.20% | 1.30% |
Trade receivables | $ 384 | $ 366 |
Trade receivables | Less than 30 days past due | ||
Aging of trade receivables | ||
Expected loss rate, % | 9.60% | 7.60% |
Trade receivables | $ 55 | $ 85 |
Trade receivables | Between 30 and 120 days past due | ||
Aging of trade receivables | ||
Expected loss rate, % | 33.60% | 27.60% |
Trade receivables | $ 29 | $ 63 |
Trade receivables | Greater than 120 days past due | ||
Aging of trade receivables | ||
Expected loss rate, % | 81.50% | 63.90% |
Trade receivables | $ 34 | $ 83 |
Trade receivables | Cost | ||
Aging of trade receivables | ||
Trade receivables | 389 | 371 |
Trade receivables | Cost | Less than 30 days past due | ||
Aging of trade receivables | ||
Trade receivables | 61 | 92 |
Trade receivables | Cost | Between 30 and 120 days past due | ||
Aging of trade receivables | ||
Trade receivables | 44 | 87 |
Trade receivables | Cost | Greater than 120 days past due | ||
Aging of trade receivables | ||
Trade receivables | 178 | 230 |
Trade receivables | Expected credit losses | ||
Aging of trade receivables | ||
Trade receivables | (5) | (5) |
Trade receivables | Expected credit losses | Less than 30 days past due | ||
Aging of trade receivables | ||
Trade receivables | (6) | (7) |
Trade receivables | Expected credit losses | Between 30 and 120 days past due | ||
Aging of trade receivables | ||
Trade receivables | (15) | (24) |
Trade receivables | Expected credit losses | Greater than 120 days past due | ||
Aging of trade receivables | ||
Trade receivables | $ (144) | $ (147) |
OTHER ASSETS AND LIABILITIES (D
OTHER ASSETS AND LIABILITIES (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | |
OTHER ASSETS AND LIABILITIES | |||
Customer acquisition costs (see Note 3) | $ 83 | $ 0 | |
Non-current income tax advances (see Note 9) | 32 | 28 | |
Other financial assets | 58 | 34 | |
Advances to suppliers | 11 | 17 | |
Deferred costs related to connection fees | 6 | 7 | |
Indemnification assets | 3 | 177 | |
Total other non-current assets | 193 | 263 | [1] |
Advances to suppliers | 151 | 162 | |
Input value added tax | 149 | 181 | |
Current income tax assets (see Note 9) | 112 | 230 | |
Prepaid taxes | 39 | 31 | |
Deferred costs related to connection fees | 8 | 12 | |
Other assets | 20 | 32 | |
Total other current assets | 479 | 648 | [1] |
Long-term deferred revenue (see Note 3) | 10 | 12 | |
Pensions and other post-employment benefits | 29 | 54 | |
Other liabilities | 14 | 17 | |
Total other non-current liabilities | 53 | 83 | [1] |
Short-term deferred revenue (see Note 3) | 151 | 146 | |
Customer advances | 200 | 228 | |
Customer deposits | 192 | 189 | |
Current income tax payables (see Note 9) | 32 | 48 | |
Other taxes payable | 352 | 427 | |
Other payments to authorities | 86 | 91 | |
Due to employees | 198 | 173 | |
Other liabilities | 79 | 99 | |
Total other current liabilities | $ 1,290 | $ 1,401 | [1] |
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
PROVISIONS AND CONTINGENT LIA_3
PROVISIONS AND CONTINGENT LIABILITIES (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
PROVISIONS | ||
Balance at beginning of the year | $ 545,000,000 | $ 622,000,000 |
Arising during the year | 74,000,000 | 144,000,000 |
Reclassified to assets held for sale | (6,000,000) | (5,000,000) |
Utilized | (35,000,000) | (100,000,000) |
Unused amounts reversed | (10,000,000) | (115,000,000) |
Transfer and reclassification | 0 | |
Discount rate adjustment and imputed interest (change in estimate) | 8,000,000 | 10,000,000 |
Translation adjustments and other | (68,000,000) | (11,000,000) |
Balance at end of the year | 508,000,000 | 545,000,000 |
Current | 398,000,000 | 123,000,000 |
Non-current | 110,000,000 | 422,000,000 |
Income tax provisions | ||
PROVISIONS | ||
Balance at beginning of the year | 258,000,000 | 244,000,000 |
Arising during the year | 11,000,000 | 57,000,000 |
Reclassified to assets held for sale | (1,000,000) | (1,000,000) |
Utilized | (6,000,000) | (4,000,000) |
Unused amounts reversed | (32,000,000) | |
Transfer and reclassification | (65,000,000) | |
Translation adjustments and other | (33,000,000) | (6,000,000) |
Balance at end of the year | 164,000,000 | 258,000,000 |
Current | 164,000,000 | |
Non-current | 258,000,000 | |
Non-income tax provisions | ||
PROVISIONS | ||
Balance at beginning of the year | 98,000,000 | 96,000,000 |
Arising during the year | 11,000,000 | 28,000,000 |
Reclassified to assets held for sale | (1,000,000) | |
Utilized | (11,000,000) | (16,000,000) |
Unused amounts reversed | (4,000,000) | |
Transfer and reclassification | 65,000,000 | |
Translation adjustments and other | (12,000,000) | (6,000,000) |
Balance at end of the year | 150,000,000 | 98,000,000 |
Current | 150,000,000 | |
Non-current | 98,000,000 | |
Decommi-ssioning provision | ||
PROVISIONS | ||
Balance at beginning of the year | 106,000,000 | 98,000,000 |
Arising during the year | 4,000,000 | 5,000,000 |
Reclassified to assets held for sale | (4,000,000) | (4,000,000) |
Utilized | (1,000,000) | (1,000,000) |
Unused amounts reversed | (2,000,000) | (2,000,000) |
Discount rate adjustment and imputed interest (change in estimate) | 8,000,000 | 10,000,000 |
Translation adjustments and other | (18,000,000) | |
Balance at end of the year | 93,000,000 | 106,000,000 |
Current | 106,000,000 | |
Non-current | 93,000,000 | |
Legal provision | ||
PROVISIONS | ||
Balance at beginning of the year | 49,000,000 | 157,000,000 |
Arising during the year | 5,000,000 | 28,000,000 |
Utilized | (2,000,000) | (66,000,000) |
Unused amounts reversed | (8,000,000) | (68,000,000) |
Translation adjustments and other | (2,000,000) | |
Balance at end of the year | 44,000,000 | 49,000,000 |
Current | 27,000,000 | 16,000,000 |
Non-current | 17,000,000 | 33,000,000 |
Other provisions | ||
PROVISIONS | ||
Balance at beginning of the year | 34,000,000 | 27,000,000 |
Arising during the year | 43,000,000 | 26,000,000 |
Utilized | (15,000,000) | (13,000,000) |
Unused amounts reversed | 0 | (9,000,000) |
Translation adjustments and other | (5,000,000) | 3,000,000 |
Balance at end of the year | 57,000,000 | 34,000,000 |
Current | $ 57,000,000 | 1,000,000 |
Non-current | $ 33,000,000 |
PROVISIONS AND CONTINGENT LIA_4
PROVISIONS AND CONTINGENT LIABILITIES - Legal Provisions (Details) - USD ($) $ in Millions | Feb. 22, 2016 | Feb. 18, 2016 | Mar. 31, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2015 | Sep. 30, 2015 |
Legal provision | |||||||
Fines and disgorgements | $ 795 | ||||||
DPA, the guilty plea, DSA and SEC | |||||||
Legal provision | |||||||
Legal provisions | $ 900 | ||||||
Future direct and incremental expected legal fees | $ 105 | ||||||
Legal fees paid utilizing provision | $ 7 | $ 14 | |||||
Reduction in provision by change in estimate | $ 26 | $ 33 | |||||
Deferred prosecution agreement | |||||||
Legal provision | |||||||
Criminal penalty to USA | $ 230 | ||||||
Forfeiture fee to USA | 40 | ||||||
Dutch Settlement Agreement | |||||||
Legal provision | |||||||
Criminal fines | 230 | ||||||
Disgorgement fee | 375 | ||||||
Forfeiture fee to department of justice | 40 | ||||||
Disgorgement fee to SEC | 167.5 | ||||||
Further payment over criminal fines to OM | $ 167.5 | ||||||
SEC Judgment | |||||||
Legal provision | |||||||
Disgorgement fee | $ 375 | ||||||
Forfeiture fee to department of justice | 40 | ||||||
Disgorgement fee to SEC | 167.5 | ||||||
Disgorgement fee to OM | $ 167.5 |
PROVISIONS AND CONTINGENT LIA_5
PROVISIONS AND CONTINGENT LIABILITIES - Contingent liabilities (Details) ৳ in Millions, ج.م. in Millions, $ in Millions, $ in Billions | Nov. 20, 2017USD ($) | Apr. 27, 2016action | Aug. 13, 2015 | May 18, 2015USD ($)card | Apr. 01, 2012USD ($)operatorcard | Mar. 31, 2011USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2016CAD ($) | Dec. 31, 2017USD ($) | Nov. 20, 2017BDT (৳) | Feb. 24, 2016EGP (ج.م.) | Jan. 18, 2016USD ($) | Jan. 18, 2016EGP (ج.م.) | May 18, 2015BDT (৳) | May 14, 2012USD ($) | May 14, 2012EGP (ج.م.) | Apr. 01, 2012BDT (৳) | Dec. 31, 2011USD ($) | Dec. 31, 2011EGP (ج.م.) | Mar. 31, 2011EGP (ج.م.) | May 31, 2010USD ($) | May 31, 2010EGP (ج.م.) |
PROVISIONS | |||||||||||||||||||||||
Applicable tax rate | 25.00% | ||||||||||||||||||||||
Threshold value of other individual contingencies for disclosure | $ | $ 5 | ||||||||||||||||||||||
Total value of all other individual contingencies above threshold other than amounts already disclosed | $ | $ 68 | $ 107 | |||||||||||||||||||||
VEON - Securities Class Action | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Number of class action lawsuits filed against the company | action | 2 | ||||||||||||||||||||||
Catalyst | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Damages sought alleging breach of contract | $ 1,034 | $ 1.3 | |||||||||||||||||||||
VAT on Replacement SIMs | Banglalink Digital Communications Limited | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Legal provisions | $ | $ 11 | $ 11 | |||||||||||||||||||||
ETA | GTH-License Fees Tax Litigation | GTH | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Additional tax liabilities | $ 113 | ج.م. 2,000 | |||||||||||||||||||||
Reassessed income tax determined by Appellate Committee | $ 18 | ج.م. 323 | |||||||||||||||||||||
Income tax assessment, final assessed income tax payable, interest portion | $ 24 | ج.م. 429 | |||||||||||||||||||||
ETA | GTH-Iraqi Profits and Dividends Tax Litigation | GTH | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Income tax assessment, final assessed income tax payable, interest portion | ج.م. 270 | 15 | 258 | ||||||||||||||||||||
Final assessed income tax payable | ج.م. | 505 | ||||||||||||||||||||||
Income tax payable, principal portion | ج.م. | ج.م. 235 | ||||||||||||||||||||||
ETA | GTH-Iraqi Profits and Dividends Tax Litigation | OTIL | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Additional tax liabilities | $ 13 | $ 13 | ج.م. 235 | $ 16 | ج.م. 282 | ج.م. 235 | |||||||||||||||||
Applicable tax rate | 20.00% | ||||||||||||||||||||||
NBR | VAT on Replacement SIMs | Banglalink Digital Communications Limited | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Unpaid SIM tax | $ 94 | ৳ 7,740 | |||||||||||||||||||||
Number of random SIM cards purchased by NBR | 5 | ||||||||||||||||||||||
Total number of SIM cards issued | 7,021,834 | ||||||||||||||||||||||
Number of other operators that received notices | operator | 3 | ||||||||||||||||||||||
Percentage of exposure of the original demand | 8.50% | ||||||||||||||||||||||
Assessed SIM tax liability | $ 92 | ৳ 7,620 | |||||||||||||||||||||
LTU | VAT on Replacement SIMs | Banglalink Digital Communications Limited | |||||||||||||||||||||||
PROVISIONS | |||||||||||||||||||||||
Unpaid SIM tax | $ 20 | ৳ 1,690 | |||||||||||||||||||||
Number of random SIM cards purchased by Review Committee | 1,200 | ||||||||||||||||||||||
Percentage of incorrectly registered SIM cards | 4.83% | ||||||||||||||||||||||
Number of SIM cards incorrectly issued | 6,887,633 | ||||||||||||||||||||||
SIM tax payable on incorrectly issued SIM cards | $ 64 | ৳ 5,320 | |||||||||||||||||||||
Percentage of SIM tax deposited | 10.00% | 10.00% |
INCOME TAXES - Income tax expen
INCOME TAXES - Income tax expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Current income taxes | |||||
Current year | $ 477 | $ 397 | $ 615 | ||
Adjustments in respect of previous years | 9 | (28) | (3) | ||
Total current income taxes | 486 | 369 | 612 | ||
Deferred income taxes | |||||
Origination / reversal of temporary differences | (419) | (159) | (217) | ||
Changes in tax rates | 6 | 10 | (7) | ||
Current year tax losses unrecognized | 283 | 146 | 172 | ||
Recognition / utilization of previously unrecognized tax losses or tax credits | (16) | (15) | |||
Derecognition of previously recognized tax losses | 95 | ||||
Write off deferred tax assets | 20 | ||||
Adjustments in respect of previous years | 28 | 86 | |||
Other | 1 | (5) | |||
Total deferred tax expense | (117) | 103 | 23 | ||
Income tax expense | $ 369 | $ 472 | [1] | $ 635 | [1] |
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INCOME TAXES - Reconciliation b
INCOME TAXES - Reconciliation between statutory and effective income tax (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Effective income tax rate reconciliation, difference due to tax effects | |||||
Netherlands corporate tax rate | 25.00% | ||||
Profit / (loss) before tax from continuing operations | $ (248) | $ 328 | $ 288 | ||
Income tax benefit / (expense) at statutory tax rate (25.0%) | 62 | (82) | (72) | ||
Different tax rates in different jurisdictions | 89 | 84 | (152) | ||
Non-deductible expenses | (120) | (117) | (89) | ||
Non-taxable income | 49 | 35 | 66 | ||
Adjustments in respect of previous years | (39) | (52) | 3 | ||
Movement in (un)recognized deferred tax assets | (354) | (166) | (247) | ||
Withholding taxes | 45 | (123) | (62) | ||
Tax claims | (17) | (24) | (59) | ||
Change in income tax rate | (6) | (10) | 7 | ||
Minimum taxes and other | (78) | (17) | (30) | ||
Income tax benefit / (expense) | $ (369) | $ (472) | [1] | $ (635) | [1] |
Effective tax rate | (148.80%) | 143.90% | 220.50% | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INCOME TAXES - Explanatory note
INCOME TAXES - Explanatory notes to the effective tax rate (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Applicable tax rate | 25.00% | ||
Movement in (un)recognized deferred tax assets | $ (354) | $ (166) | $ (247) |
Reversal of withholding tax liabilities | 419 | 159 | 217 |
Netherlands | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Movement in (un)recognized deferred tax assets | 147 | 112 | 247 |
Pakistan | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Reversal of withholding tax liabilities | 45 | ||
GTH | |||
Disclosure of temporary difference, unused tax losses and unused tax credits [line items] | |||
Movement in (un)recognized deferred tax assets | $ 213 | $ 49 | $ 21 |
INCOME TAXES - Deferred taxes (
INCOME TAXES - Deferred taxes (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Deferred tax assets and liabilities | ||||
Deferred tax assets | $ 197 | $ 336 | [1] | |
Deferred tax liabilities | (180) | (376) | [1] | |
Net deferred tax assets | 17 | (40) | ||
Net deferred tax liabilities | $ (17) | $ (40) | $ (12) | |
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INCOME TAXES - Deferred tax ass
INCOME TAXES - Deferred tax assets and liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income taxes | ||
Opening balance - liabilities | $ (40) | $ (12) |
Opening balance - assets | (40) | |
Net income statement movement | 117 | (103) |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (48) | 100 |
Currency translation | (12) | (49) |
Ending balance - liabilities | (17) | (40) |
Ending balance - assets | 17 | (40) |
Property and equipment | ||
Income taxes | ||
Opening balance - liabilities | (443) | (420) |
Net income statement movement | 126 | (6) |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (3) | (13) |
Currency translation | 45 | (4) |
Ending balance - liabilities | (275) | (443) |
Intangible assets | ||
Income taxes | ||
Opening balance - liabilities | (165) | (166) |
Net income statement movement | 94 | 0 |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (2) | (4) |
Currency translation | 13 | 5 |
Ending balance - liabilities | (60) | (165) |
Trade receivables | ||
Income taxes | ||
Opening balance - assets | 36 | 30 |
Net income statement movement | (6) | 19 |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | 3 | (4) |
Currency translation | (1) | (9) |
Ending balance - assets | 32 | 36 |
Provisions | ||
Income taxes | ||
Opening balance - assets | 33 | 29 |
Net income statement movement | 2 | 3 |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (5) | (3) |
Currency translation | 0 | 4 |
Ending balance - assets | 30 | 33 |
Accounts payable | ||
Income taxes | ||
Opening balance - assets | 133 | 94 |
Net income statement movement | 7 | 38 |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (11) | 28 |
Currency translation | (16) | (27) |
Ending balance - assets | 113 | 133 |
Withholding tax on distributed earnings | ||
Income taxes | ||
Opening balance - liabilities | (116) | (73) |
Net income statement movement | 70 | (43) |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (3) | 1 |
Currency translation | (1) | (1) |
Ending balance - liabilities | (50) | (116) |
Tax losses and other balances carried forwards | ||
Income taxes | ||
Opening balance - assets | 2,434 | 2,270 |
Net income statement movement | (191) | (47) |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (19) | 261 |
Currency translation | (51) | (50) |
Ending balance - assets | 2,173 | 2,434 |
Non-recognized deferred tax assets | ||
Income taxes | ||
Opening balance - liabilities | (1,980) | (1,849) |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | 25 | (131) |
Ending balance - liabilities | (1,955) | (1,980) |
Other | ||
Income taxes | ||
Opening balance - assets | 28 | 97 |
Net income statement movement | 15 | (67) |
Changes in composition of the group | 0 | 0 |
Other comprehensive & other | (33) | (35) |
Currency translation | (1) | 33 |
Ending balance - assets | $ 9 | $ 28 |
INCOME TAXES - Tax losses year
INCOME TAXES - Tax losses year of expiration (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Income taxes | ||
Recognized losses | $ (508) | $ (1,192) |
Recognized DTA | 163 | 322 |
Non-recognized losses | (9,735) | (9,455) |
Non-recognized DTA | 1,955 | 1,987 |
Recognized credits | (55) | (68) |
Recognized DTA | 55 | 68 |
Non-recognized credits | 0 | 0 |
Non-recognized DTA | 0 | 0 |
0-5 years | ||
Income taxes | ||
Recognized losses | (83) | (347) |
Recognized DTA | 17 | 85 |
Non-recognized losses | (968) | (420) |
Non-recognized DTA | 198 | 95 |
Recognized credits | (55) | (68) |
Recognized DTA | 55 | 68 |
6-10 years | ||
Income taxes | ||
Recognized losses | (12) | |
Recognized DTA | 3 | |
Non-recognized losses | (2,421) | (2,639) |
Non-recognized DTA | 497 | 660 |
Indefinite | ||
Income taxes | ||
Recognized losses | (425) | (833) |
Recognized DTA | 146 | 234 |
Non-recognized losses | (6,346) | (6,396) |
Non-recognized DTA | 1,260 | 1,232 |
Luxembourg | ||
Income taxes | ||
Non-recognized losses | (6,135) | (6,532) |
Netherlands | ||
Income taxes | ||
Non-recognized losses | $ (2,762) | $ (2,474) |
INCOME TAXES - Foreign subsidia
INCOME TAXES - Foreign subsidiaries, outside income statement and non-current tax assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | ||
Income taxes | |||
Deferred tax liability | $ 180 | $ 376 | [1] |
Current and deferred taxes | (69) | ||
Current tax charge | (22) | ||
Deferred tax charge | (47) | ||
Current and non-current income tax assets | 144 | 258 | |
Russian, Algerian and Pakistan | |||
Income taxes | |||
Deferred tax liability | 50 | 116 | |
Foreign subsidiaries outside Netherlands | |||
Income taxes | |||
Undistributed earnings of VEON's foreign subsidiaries | $ 6,330 | $ 6,833 | |
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SIGNIFICANT TRANSACTIONS - Sale
SIGNIFICANT TRANSACTIONS - Sale of Italy Joint Venture (Details) € in Millions, $ in Millions | Sep. 07, 2018USD ($) | Sep. 07, 2018EUR (€) | Jul. 03, 2018 | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | ||
Effect of the disposal of Italy | |||||||||
Gain / (loss) on disposal of discontinued operations | $ 1,279 | $ 0 | [1] | $ 1,788 | [1] | ||||
Financial information related to discontinued operations | |||||||||
Share of profit / (loss) of Italy Joint Venture | (300) | (390) | [1] | 979 | [1] | ||||
Discontinued operations | |||||||||
Effect of the disposal of Italy | |||||||||
Gain / (loss) on disposal of discontinued operations | $ 30 | ||||||||
Italy Joint Venture | Discontinued operations | |||||||||
Joint Venture in Italy | |||||||||
Proportion of ownership interest in joint venture | 50.00% | ||||||||
Effect of the disposal of Italy | |||||||||
Cash consideration received | $ 2,830 | € 2,450 | |||||||
Derecognition of assets classified as held for sale | (1,599) | ||||||||
Release cumulative share of other comprehensive income / (loss) of Italy Joint Venture | (31) | ||||||||
Release cumulative foreign currency translation reserve related to Italy Joint Venture | 79 | ||||||||
Gain / (loss) on disposal of discontinued operations | 1,279 | ||||||||
Release of cumulative net investment hedge on disposal | $ 80 | ||||||||
Financial information related to discontinued operations | |||||||||
Share of profit / (loss) of Italy Joint Venture | (300) | (390) | 59 | ||||||
Share of other comprehensive income / (loss) of Italy Joint Venture | $ (18) | $ (12) | $ 0 | ||||||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SIGNIFICANT TRANSACTIONS - Term
SIGNIFICANT TRANSACTIONS - Termination of Deodar sale (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Assets and liabilities classified as held for sale | ||||
Property and equipment | $ 4,932 | $ 6,237 | [1] | $ 6,719 |
Goodwill | 3,816 | 4,618 | [1] | $ 4,696 |
Deferred tax assets | 197 | 336 | [1] | |
Other non-current assets | 193 | 263 | [1] | |
Other current assets | 479 | 648 | [1] | |
Total assets | 14,102 | 19,484 | [1] | |
Equity attributable to equity owners of the parent | 3,670 | 4,331 | [1] | |
Non-controlling interests | (891) | (441) | [1] | |
Non-current liabilities | 6,910 | 10,944 | [1] | |
Current liabilities | 4,409 | 4,635 | [1] | |
Deodar | ||||
Assets and liabilities classified as held for sale | ||||
Property and equipment | 6,237 | |||
Goodwill | 4,618 | |||
Deferred tax assets | 336 | |||
Other non-current assets | 201 | |||
Other current assets | 2,487 | |||
Total assets | 22 | |||
Equity attributable to equity owners of the parent | 4,331 | |||
Non-controlling interests | (441) | |||
Non-current liabilities | 10,944 | |||
Current liabilities | 4,635 | |||
Total liabilities | 15 | |||
Balance sheet as reported | ||||
Assets and liabilities classified as held for sale | ||||
Property and equipment | 4,932 | |||
Goodwill | 3,816 | |||
Deferred tax assets | 197 | |||
Other non-current assets | 193 | |||
Other current assets | 2,516 | |||
Total assets | 14,102 | |||
Equity attributable to equity owners of the parent | 3,670 | |||
Non-controlling interests | (891) | |||
Non-current liabilities | 6,910 | |||
Current liabilities | $ 4,409 | |||
Balance sheet as reported | Deodar | ||||
Assets and liabilities classified as held for sale | ||||
Property and equipment | 6,097 | |||
Goodwill | 4,394 | |||
Deferred tax assets | 272 | |||
Other non-current assets | 199 | |||
Other current assets | 2,443 | |||
Total assets | 533 | |||
Equity attributable to equity owners of the parent | 4,352 | |||
Non-controlling interests | (425) | |||
Non-current liabilities | 10,937 | |||
Current liabilities | 4,607 | |||
Total liabilities | 50 | |||
Retrospective depreciation recorded in 2017 | Deodar | ||||
Assets and liabilities classified as held for sale | ||||
Property and equipment | (37) | |||
Goodwill | 0 | |||
Deferred tax assets | 0 | |||
Other non-current assets | 0 | |||
Other current assets | 0 | |||
Total assets | 0 | |||
Equity attributable to equity owners of the parent | (21) | |||
Non-controlling interests | (16) | |||
Non-current liabilities | 0 | |||
Current liabilities | 0 | |||
Total liabilities | 0 | |||
Reclassification | Deodar | ||||
Assets and liabilities classified as held for sale | ||||
Property and equipment | 177 | |||
Goodwill | 224 | |||
Deferred tax assets | 64 | |||
Other non-current assets | 2 | |||
Other current assets | 44 | |||
Total assets | (511) | |||
Equity attributable to equity owners of the parent | 0 | |||
Non-controlling interests | 0 | |||
Non-current liabilities | 7 | |||
Current liabilities | 28 | |||
Total liabilities | $ (35) | |||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SIGNIFICANT TRANSACTIONS - Exit
SIGNIFICANT TRANSACTIONS - Exit from Euroset Holding B.V. Joint Venture (Details) - Jul. 07, 2017 - PJSC VimpelCom - Euroset ₽ in Millions, $ in Millions | USD ($)store | RUB (₽)store |
Investments in associates and joint ventures | ||
Proportion of ownership interest in joint venture | 50.00% | 50.00% |
Megafon | ||
Investments in associates and joint ventures | ||
Proportion of ownership interest in joint venture | 50.00% | 50.00% |
Consideration paid | $ 21 | ₽ 1,200 |
Number of retail stores rights acquired | 4,000 | 4,000 |
SIGNIFICANT TRANSACTIONS - With
SIGNIFICANT TRANSACTIONS - Withdrawal of mandatory tender offer in relation to Global Telecom Holding S.A.E (Details) $ in Millions | Mar. 31, 2018USD ($) |
Global Telecom Holding S.A.E | Cash pledged as collateral | |
Investments in subsidiaries | |
Collateral security released value | $ 987 |
IMPAIRMENT - Impairment losses
IMPAIRMENT - Impairment losses (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Impairment losses | |||
Impairment loss | $ 858,000,000 | $ 66,000,000 | $ 204,000,000 |
Additional impairment loss recorded during the period | 15,000,000 | ||
Property and equipment | |||
Impairment losses | |||
Impairment loss | 335,000,000 | 15,000,000 | 100,000,000 |
Intangible assets | |||
Impairment losses | |||
Impairment loss | 299,000,000 | 0 | 14,000,000 |
Goodwill | |||
Impairment losses | |||
Impairment loss | 224,000,000 | 51,000,000 | 78,000,000 |
Other assets | |||
Impairment losses | |||
Impairment loss | 12,000,000 | ||
Algeria | |||
Impairment losses | |||
Impairment loss | 125,000,000 | ||
Algeria | Goodwill | |||
Impairment losses | |||
Impairment loss | 125,000,000 | ||
Armenia | |||
Impairment losses | |||
Impairment loss | 81,000,000 | 34,000,000 | |
Armenia | Property and equipment | |||
Impairment losses | |||
Impairment loss | 46,000,000 | ||
Armenia | Intangible assets | |||
Impairment losses | |||
Impairment loss | 10,000,000 | ||
Armenia | Goodwill | |||
Impairment losses | |||
Impairment loss | 25,000,000 | 34,000,000 | |
Bangladesh | |||
Impairment losses | |||
Impairment loss | 451,000,000 | ||
Bangladesh | Property and equipment | |||
Impairment losses | |||
Impairment loss | 221,000,000 | ||
Bangladesh | Intangible assets | |||
Impairment losses | |||
Impairment loss | 230,000,000 | ||
Georgia | |||
Impairment losses | |||
Impairment loss | 50,000,000 | 29,000,000 | |
Impairment loss allocated to current and non-current assets | 29,000,000 | ||
Recoverable amounts based on a fair value less costs of disposal | $ 49,000,000 | ||
Post-tax discount rate | 10.30% | ||
Georgia | Property and equipment | |||
Impairment losses | |||
Impairment loss | 31,000,000 | $ 16,000,000 | |
Georgia | Intangible assets | |||
Impairment losses | |||
Impairment loss | 19,000,000 | 13,000,000 | |
Kyrgyzstan | |||
Impairment losses | |||
Impairment loss | 74,000,000 | 17,000,000 | 49,000,000 |
Impairment loss allocated to current and non-current assets | 49,000,000 | ||
Recoverable amounts based on a fair value less costs of disposal | $ 219,000,000 | ||
Post-tax discount rate | 14.50% | ||
Kyrgyzstan | Goodwill | |||
Impairment losses | |||
Impairment loss | 74,000,000 | 17,000,000 | $ 49,000,000 |
Tajikistan | |||
Impairment losses | |||
Impairment loss | 88,000,000 | ||
Tajikistan | Property and equipment | |||
Impairment losses | |||
Impairment loss | 54,000,000 | ||
Tajikistan | Intangible assets | |||
Impairment losses | |||
Impairment loss | 1,000,000 | ||
Tajikistan | Goodwill | |||
Impairment losses | |||
Impairment loss | 21,000,000 | ||
Tajikistan | Other assets | |||
Impairment losses | |||
Impairment loss | 12,000,000 | ||
Other | |||
Impairment losses | |||
Impairment loss | 77,000,000 | 15,000,000 | 38,000,000 |
Other | Property and equipment | |||
Impairment losses | |||
Impairment loss | 37,000,000 | $ 15,000,000 | 30,000,000 |
Other | Intangible assets | |||
Impairment losses | |||
Impairment loss | $ 40,000,000 | ||
Other | Goodwill | |||
Impairment losses | |||
Impairment loss | $ 8,000,000 |
IMPAIRMENT - Key assumptions (D
IMPAIRMENT - Key assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Key assumptions for determining the recoverable amount | |||
Maturity period for an United States Treasury bond | 20 years | ||
Percentage of equity market risk premium | 5.40% | 6.00% | |
Median historical capital structure | 5 years | ||
Cash flow forecasts for license and spectrum payments | 5 years | ||
Russia | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 10.30% | 10.60% | 9.70% |
Average annual revenue growth rate during forecast period | 1.10% | 1.90% | 2.40% |
Terminal growth rate | 1.30% | 1.00% | 1.00% |
Average operating margin | 34.60% | 36.40% | 38.60% |
Average CAPEX as a percentage of revenue | 19.80% | 15.70% | 15.90% |
Ukraine | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 16.30% | 17.10% | 17.20% |
Average annual revenue growth rate during forecast period | 4.40% | 3.90% | 3.60% |
Terminal growth rate | 4.00% | 2.00% | 1.00% |
Average operating margin | 54.00% | 49.90% | 44.90% |
Average CAPEX as a percentage of revenue | 16.30% | 15.60% | 17.00% |
Algeria | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 11.10% | 10.70% | 9.80% |
Average annual revenue growth rate during forecast period | 0.70% | 1.00% | (0.80%) |
Terminal growth rate | 0.90% | 3.00% | 3.00% |
Average operating margin | 44.00% | 46.20% | 50.80% |
Average CAPEX as a percentage of revenue | 15.10% | 14.80% | 15.80% |
Pakistan | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 14.40% | 15.00% | 14.30% |
Average annual revenue growth rate during forecast period | 3.50% | 5.00% | 7.60% |
Terminal growth rate | 4.00% | 4.00% | 4.00% |
Average operating margin | 47.90% | 43.60% | 33.30% |
Average CAPEX as a percentage of revenue | 16.70% | 15.30% | 14.30% |
Bangladesh | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 12.20% | 12.70% | 11.90% |
Average annual revenue growth rate during forecast period | 0.60% | 5.00% | 6.40% |
Terminal growth rate | 4.00% | 4.60% | 4.70% |
Average operating margin | 35.40% | 38.70% | 44.90% |
Average CAPEX as a percentage of revenue | 14.90% | 14.30% | 14.60% |
Kazakhstan | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 8.40% | 10.80% | 12.40% |
Average annual revenue growth rate during forecast period | 2.80% | 3.20% | 4.40% |
Terminal growth rate | 1.10% | 2.40% | 2.00% |
Average operating margin | 46.50% | 44.50% | 43.60% |
Average CAPEX as a percentage of revenue | 17.70% | 17.90% | 18.80% |
Kyrgyzstan | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 14.80% | 15.50% | 14.50% |
Average annual revenue growth rate during forecast period | 2.80% | (1.50%) | (1.80%) |
Terminal growth rate | 5.00% | 3.50% | 2.50% |
Average operating margin | 39.90% | 42.00% | 43.90% |
Average CAPEX as a percentage of revenue | 17.20% | 16.40% | 17.00% |
Uzbekistan | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 13.10% | 15.30% | 15.40% |
Average annual revenue growth rate during forecast period | 5.50% | 6.90% | 1.70% |
Terminal growth rate | 6.30% | 6.50% | 1.00% |
Average operating margin | 43.90% | 42.90% | 58.20% |
Average CAPEX as a percentage of revenue | 16.20% | 14.10% | 18.20% |
Armenia | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 12.50% | 13.00% | 12.00% |
Average annual revenue growth rate during forecast period | 0.20% | (1.00%) | (2.80%) |
Terminal growth rate | 0.80% | 3.00% | 1.00% |
Average operating margin | 23.60% | 29.70% | 37.80% |
Average CAPEX as a percentage of revenue | 21.00% | 19.60% | 14.10% |
Georgia | |||
Key assumptions for determining the recoverable amount | |||
Discount rate (local currency) | 10.60% | 11.00% | 10.30% |
Average annual revenue growth rate during forecast period | 2.10% | 5.60% | 6.40% |
Terminal growth rate | 3.00% | 1.00% | 1.00% |
Average operating margin | 24.50% | 25.20% | 25.70% |
Average CAPEX as a percentage of revenue | 23.80% | 23.30% | 17.30% |
PROPERTY AND EQUIPMENT - Activi
PROPERTY AND EQUIPMENT - Activity (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | |||
Property plant and equipment | ||||
Property, plant and equipment at beginning of period | $ 6,237 | [1] | $ 6,719 | |
Additions | 1,247 | 1,273 | ||
Disposals | (68) | (49) | ||
Depreciation charge for the year | (1,339) | (1,491) | ||
Impairment | (335) | (15) | ||
Reclassified to assets held for sale | (16) | (17) | ||
Translation adjustment | (794) | (183) | ||
Property, plant and equipment at end of period | 4,932 | 6,237 | [1] | |
Cost | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | 12,931 | |||
Accumulated depreciation and impairment | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | (7,999) | |||
Telecomm-unications equipment | ||||
Property plant and equipment | ||||
Property, plant and equipment at beginning of period | 5,132 | 5,166 | ||
Additions | 52 | 39 | ||
Disposals | (51) | (36) | ||
Depreciation charge for the year | (1,165) | (1,307) | ||
Impairment | (280) | (5) | ||
Transfers | 979 | 1,440 | ||
Reclassified to assets held for sale | (15) | (13) | ||
Translation adjustment | (644) | (152) | ||
Property, plant and equipment at end of period | 4,008 | 5,132 | ||
Telecomm-unications equipment | Cost | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | 10,758 | |||
Telecomm-unications equipment | Accumulated depreciation and impairment | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | (6,750) | |||
Land, buildings and constructions | ||||
Property plant and equipment | ||||
Property, plant and equipment at beginning of period | 240 | 243 | ||
Additions | 8 | 14 | ||
Disposals | (2) | 0 | ||
Depreciation charge for the year | (31) | (32) | ||
Impairment | (10) | 0 | ||
Transfers | 22 | 16 | ||
Reclassified to assets held for sale | (1) | (1) | ||
Translation adjustment | (24) | 0 | ||
Property, plant and equipment at end of period | 202 | 240 | ||
Land, buildings and constructions | Cost | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | 443 | |||
Land, buildings and constructions | Accumulated depreciation and impairment | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | (241) | |||
Office and other equipment | ||||
Property plant and equipment | ||||
Property, plant and equipment at beginning of period | 470 | 456 | ||
Additions | 14 | 26 | ||
Disposals | (10) | (7) | ||
Depreciation charge for the year | (143) | (152) | ||
Impairment | (8) | 0 | ||
Transfers | 136 | 147 | ||
Reclassified to assets held for sale | 0 | (2) | ||
Translation adjustment | (66) | 2 | ||
Property, plant and equipment at end of period | 393 | 470 | ||
Office and other equipment | Cost | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | 1,271 | |||
Office and other equipment | Accumulated depreciation and impairment | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | (878) | |||
Equipment not installed and assets under construction | ||||
Property plant and equipment | ||||
Property, plant and equipment at beginning of period | 395 | 854 | ||
Additions | 1,173 | 1,194 | ||
Disposals | (5) | (6) | ||
Impairment | (37) | (10) | ||
Transfers | (1,137) | (1,603) | ||
Reclassified to assets held for sale | 0 | (1) | ||
Translation adjustment | (60) | (33) | ||
Property, plant and equipment at end of period | 329 | $ 395 | ||
Equipment not installed and assets under construction | Cost | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | 459 | |||
Equipment not installed and assets under construction | Accumulated depreciation and impairment | ||||
Property plant and equipment | ||||
Property, plant and equipment at end of period | $ (130) | |||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
PROPERTY AND EQUIPMENT - Additi
PROPERTY AND EQUIPMENT - Additional information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Property plant and equipment | ||
Impairment | $ 335 | $ 15 |
Acquired property and equipment, not yet paid | 346 | 441 |
Property plant and equipment pledged as security for bank borrowings | 750 | 875 |
Telecomm-unications equipment | ||
Property plant and equipment | ||
Impairment | $ 280 | 5 |
Telecomm-unications equipment | Minimum | ||
Property plant and equipment | ||
Useful life | P3Y | |
Telecomm-unications equipment | Maximum | ||
Property plant and equipment | ||
Useful life | P20Y | |
Buildings and constructions | Minimum | ||
Property plant and equipment | ||
Useful life | P10Y | |
Buildings and constructions | Maximum | ||
Property plant and equipment | ||
Useful life | P50Y | |
Office and other equipment | ||
Property plant and equipment | ||
Impairment | $ 8 | $ 0 |
Office and other equipment | Minimum | ||
Property plant and equipment | ||
Useful life | P3Y | |
Office and other equipment | Maximum | ||
Property plant and equipment | ||
Useful life | P10Y |
PROPERTY AND EQUIPMENT - Commit
PROPERTY AND EQUIPMENT - Commitments (Details) person in Thousands, $ in Millions, ₽ in Billions | 1 Months Ended | 12 Months Ended | |||
Jul. 31, 2012USD ($)personregion | Jul. 31, 2012RUB (₽)personregion | Dec. 31, 2013region | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Disclosure of capital commitments [line items] | |||||
Total commitments | $ 437 | $ 817 | |||
Less than 1 year | |||||
Disclosure of capital commitments [line items] | |||||
Total commitments | 433 | 555 | |||
Between 1 and 5 years | |||||
Disclosure of capital commitments [line items] | |||||
Total commitments | $ 4 | $ 262 | |||
Russia | LTE services | PJSC VimpelCom | |||||
Disclosure of capital commitments [line items] | |||||
Number of regions LTE services were offered in | region | 6 | ||||
Minimum annual investment value for construction | $ 260 | ₽ 15 | |||
Required population to provide data transmission services in specified areas | person | 50 | 50 | |||
Number of targeted mobile service provision regions | region | 5 | 5 |
INTANGIBLE ASSETS - Summary of
INTANGIBLE ASSETS - Summary of the Movement in the Net Book Value of Intangible Assets (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Intangible assets | |||||
Balance at beginning of the period | $ 2,168,000,000 | [1] | $ 2,257,000,000 | ||
Additions | 717,000,000 | 518,000,000 | |||
Disposals | (7,000,000) | (4,000,000) | |||
Amortization charge for the year | (495,000,000) | (537,000,000) | |||
Impairment | (299,000,000) | ||||
Translation adjustment | (230,000,000) | (66,000,000) | |||
Balance at end of the period | 1,854,000,000 | 2,168,000,000 | [1] | $ 2,257,000,000 | |
Impairment loss | 858,000,000 | 66,000,000 | 204,000,000 | ||
Acquired intangible assets, not yet paid | 100,000,000 | 92,000,000 | |||
Cost | |||||
Intangible assets | |||||
Balance at end of the period | 5,827,000,000 | ||||
Accumulated depreciation and impairment | |||||
Intangible assets | |||||
Balance at end of the period | (3,973,000,000) | ||||
Intangible assets | |||||
Intangible assets | |||||
Impairment loss | $ 299,000,000 | $ 0 | $ 14,000,000 | ||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INTANGIBLE ASSETS - Acquisition
INTANGIBLE ASSETS - Acquisition of spectrums (Details) ₴ in Millions, ৳ in Millions, $ in Millions | 1 Months Ended | |||||
Mar. 31, 2018USD ($)MHzlot | Mar. 31, 2018UAH (₴)MHzlot | Feb. 28, 2018USD ($)MHz | Feb. 28, 2018BDT (৳) | Jan. 31, 2018USD ($)MHzlicense | Jan. 31, 2018UAH (₴)MHzlicense | |
Intangible assets | ||||||
Number of 4G/LTE licenses secured | license | 3 | 3 | ||||
JSC “Kyivstar” | ||||||
Intangible assets | ||||||
Number of 4G/LTE licenses secured | license | 1 | 1 | ||||
Payment of license acquisition cost | $ 32 | ₴ 900 | ||||
Paired frequency bands | 15 | 15 | ||||
JSC “Kyivstar” | 1800MHz Band, Tranche One | ||||||
Intangible assets | ||||||
Payment of license acquisition cost | $ 47 | ₴ 1,325 | ||||
Paired frequency bands | 25 | 25 | ||||
JSC “Kyivstar” | 1800MHz Band, Tranche Two | ||||||
Intangible assets | ||||||
Payment of license acquisition cost | $ 53 | ₴ 1,512 | ||||
Paired frequency bands | 5 | 5 | ||||
Number of lots of paired frequency bands | lot | 2 | 2 | ||||
Banglalink Digital Communications Limited | ||||||
Intangible assets | ||||||
Payment of license acquisition cost | $ 1.2 | ৳ 100 | ||||
Spectrum cost | $ | $ 308.6 | |||||
Percentage of upfront payment | 60.00% | |||||
Percentage of remaining payment | 40.00% | |||||
Upfront payment term | 4 years | 4 years | ||||
Amount payable to convert into technology neutral spectrum | $ | $ 35 | |||||
Maximum | JSC “Kyivstar” | ||||||
Intangible assets | ||||||
Frequency bands | 2,600 | 2,600 | ||||
Maximum | Banglalink Digital Communications Limited | ||||||
Intangible assets | ||||||
Frequency bands | 2,100 | |||||
Converted frequency bands | 1,800 | |||||
Minimum | JSC “Kyivstar” | ||||||
Intangible assets | ||||||
Frequency bands | 1,800 | 1,800 | 1,800 | 1,800 | ||
Minimum | Banglalink Digital Communications Limited | ||||||
Intangible assets | ||||||
Frequency bands | 1,800 | |||||
Converted frequency bands | 900 |
INTANGIBLE ASSETS - Schedule of
INTANGIBLE ASSETS - Schedule of Capital Commitments (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Disclosure of capital commitments [line items] | ||
Contractual commitments for acquisition of intangible assets | $ 23 | $ 44 |
Less than 1 year | ||
Disclosure of capital commitments [line items] | ||
Contractual commitments for acquisition of intangible assets | 23 | 40 |
Between 1 and 5 years | ||
Disclosure of capital commitments [line items] | ||
Contractual commitments for acquisition of intangible assets | $ 0 | $ 4 |
GOODWILL (Details)
GOODWILL (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | |||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | $ 4,618 | [1] | $ 4,696 | |
Impairment | (224) | (51) | ||
Currency translation | (578) | (27) | ||
Goodwill at end of period | 3,816 | 4,618 | [1] | |
Russia | ||||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | 2,434 | 2,312 | ||
Currency translation | (416) | 122 | ||
Goodwill at end of period | 2,018 | 2,434 | ||
Algeria | ||||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | 1,340 | 1,393 | ||
Impairment | (125) | |||
Currency translation | (39) | (53) | ||
Goodwill at end of period | 1,176 | 1,340 | ||
Pakistan | ||||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | 468 | 497 | ||
Currency translation | (97) | (29) | ||
Goodwill at end of period | 371 | 468 | ||
Kazakhstan | ||||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | 177 | 176 | ||
Currency translation | (24) | 1 | ||
Goodwill at end of period | 153 | 177 | ||
Kyrgyzstan | ||||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | 128 | 145 | ||
Impairment | (74) | (17) | ||
Goodwill at end of period | 54 | 128 | ||
Uzbekistan | ||||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | 46 | 114 | ||
Currency translation | (2) | (68) | ||
Goodwill at end of period | 44 | 46 | ||
Armenia | ||||
Reconciliation of changes in goodwill [abstract] | ||||
Goodwill at beginning of period | 25 | 59 | ||
Impairment | (25) | (34) | ||
Goodwill at end of period | $ 0 | $ 25 | ||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INVESTMENTS IN SUBSIDIARIES - I
INVESTMENTS IN SUBSIDIARIES - Information about significant subsidiaries (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Omnium Telecom Algérie S.p.A And Optimum Telecom Algeria S.p.A [Member] | Global Telecom Holding S.A.E | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 50.00% | |
VEON Amsterdam B.V. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
VEON Holdings B.V. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
PJSC VimpelCom | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
JSC “Kyivstar” | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
LLP “KaR-Tel” | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 75.00% | 75.00% |
LLC “Unitel” | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
LLC “VEON Georgia” | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 80.00% | 80.00% |
CJSC “VEON Armenia” | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
LLC “Sky Mobile” | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 50.10% | 50.10% |
VEON Luxembourg Holdings S.à r.l. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
VEON Luxembourg Finance Holdings S.à r.l. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
VEON Luxembourg Finance S.A. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 100.00% | 100.00% |
Global Telecom Holding S.A.E | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 58.00% | 58.00% |
Omnium Telecom Algérie S.p.A. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 26.00% | 26.00% |
Optimum Telecom Algeria S.p.A. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 26.00% | 26.00% |
Pakistan Mobile Communications Limited | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 49.00% | 49.00% |
Banglalink Digital Communications Limited | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 57.70% | 58.00% |
LLC Tacom | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 0.00% | 98.00% |
Vimpelcom Lao Co Ltd. | ||
Investments in subsidiaries | ||
Equity interest held by the Group | 0.00% | 78.00% |
INVESTMENTS IN SUBSIDIARIES INV
INVESTMENTS IN SUBSIDIARIES INVESTMENTS IN SUBSIDIARIES - Gain on sale of subsidiaries (Details) $ in Millions | Apr. 05, 2018 | Oct. 27, 2017USD ($) | Dec. 31, 2018USD ($)subsidiary | Jun. 30, 2018USD ($) | Feb. 22, 2018payment | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | [1] | |
Investments in subsidiaries | ||||||||||
Gain on disposal | $ 1,279 | $ 0 | [1] | $ 1,788 | ||||||
Tacom | ||||||||||
Investments in subsidiaries | ||||||||||
Percentage of interest in subsidiary | 0.00% | 98.00% | ||||||||
Discontinued operations | ||||||||||
Investments in subsidiaries | ||||||||||
Net cash consideration received | $ 22 | |||||||||
Derecognition of assets classified as held for sale | (34) | |||||||||
Derecognition of liabilities classified as held for sale | 48 | |||||||||
Derecognition of non-controlling interests | (6) | |||||||||
Release cumulative other comprehensive income related to disposal group | 0 | |||||||||
Gain on disposal | 30 | |||||||||
Discontinued operations | VIP Lao | ||||||||||
Investments in subsidiaries | ||||||||||
Net cash consideration received | 22 | |||||||||
Derecognition of assets classified as held for sale | (21) | |||||||||
Derecognition of liabilities classified as held for sale | 13 | |||||||||
Derecognition of non-controlling interests | (6) | |||||||||
Release cumulative other comprehensive income related to disposal group | 1 | |||||||||
Gain on disposal | 9 | |||||||||
Discontinued operations | Vimpelcom (BVI) AG | ||||||||||
Investments in subsidiaries | ||||||||||
Net cash consideration received | 0 | |||||||||
Derecognition of assets classified as held for sale | (13) | |||||||||
Derecognition of liabilities classified as held for sale | 25 | |||||||||
Derecognition of non-controlling interests | 0 | |||||||||
Release cumulative other comprehensive income related to disposal group | (1) | |||||||||
Gain on disposal | 11 | |||||||||
Discontinued operations | Ring Distribution Company S.A.E. | ||||||||||
Investments in subsidiaries | ||||||||||
Net cash consideration received | 0 | |||||||||
Derecognition of assets classified as held for sale | 0 | |||||||||
Derecognition of liabilities classified as held for sale | 10 | |||||||||
Derecognition of non-controlling interests | 0 | |||||||||
Release cumulative other comprehensive income related to disposal group | 0 | |||||||||
Gain on disposal | $ 10 | $ 10 | ||||||||
Number of subsidiaries liquidated | subsidiary | 1 | |||||||||
Government of Laos | Discontinued operations | VIP Lao | ||||||||||
Investments in subsidiaries | ||||||||||
Net cash consideration received | $ 22 | |||||||||
Proportion of ownership interest disposed in subsidiary | 78.00% | |||||||||
Number of purchase consideration payments received | payment | 2 | |||||||||
ZET | Discontinued operations | Vimpelcom (BVI) AG | ||||||||||
Investments in subsidiaries | ||||||||||
Proportion of ownership interest disposed in subsidiary | 100.00% | |||||||||
Vimpelcom (BVI) AG | ZET | Discontinued operations | Tacom | ||||||||||
Investments in subsidiaries | ||||||||||
Percentage of interest in subsidiary | 98.00% | |||||||||
ZET | Discontinued operations | Tacom | ||||||||||
Investments in subsidiaries | ||||||||||
Percentage of interest in subsidiary | 2.00% | |||||||||
Proportion of indirect ownership interest in subsidiary | 98.00% | |||||||||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INVESTMENTS IN SUBSIDIARIES - F
INVESTMENTS IN SUBSIDIARIES - Financial information of subsidiaries that have material NCIs (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | [1] | ||
Investments in subsidiaries | |||||
Profit/(loss) attributable to material NCIs | $ (220) | $ (29) | [1] | $ 92 | |
Kar-Tel | |||||
Investments in subsidiaries | |||||
Equity interest held by NCIs | 25.00% | 25.00% | |||
Book values of material NCIs | $ 228 | $ 252 | |||
Profit/(loss) attributable to material NCIs | $ 19 | $ 8 | |||
Sky Mobile | |||||
Investments in subsidiaries | |||||
Equity interest held by NCIs | 49.80% | 49.80% | |||
Book values of material NCIs | $ 133 | $ 167 | |||
Profit/(loss) attributable to material NCIs | $ (32) | $ 3 | |||
Global Telecom Holding S.A.E | |||||
Investments in subsidiaries | |||||
Equity interest held by NCIs | 42.30% | 42.30% | |||
Book values of material NCIs | $ (1,190) | $ (793) | |||
Profit/(loss) attributable to material NCIs | $ (217) | $ (40) | |||
Omnium Telecom Algérie S.p.A. | |||||
Investments in subsidiaries | |||||
Equity interest held by NCIs | 73.70% | 73.70% | |||
Book values of material NCIs | $ 1,091 | $ 1,235 | |||
Profit/(loss) attributable to material NCIs | $ 1 | $ 100 | |||
Algeria | Omnium Telecom Algérie S.p.A. | |||||
Investments in subsidiaries | |||||
Equity interest held by NCIs | 54.40% | ||||
Egypt | Omnium Telecom Algérie S.p.A. | |||||
Investments in subsidiaries | |||||
Equity interest held by NCIs | 42.30% | ||||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INVESTMENTS IN SUBSIDIARIES - S
INVESTMENTS IN SUBSIDIARIES - Summarized income statement (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Summarized income statement | |||||
Operating revenue | $ 9,086 | $ 9,474 | [1] | $ 8,885 | [1] |
Operating expenses | (8,532) | (8,007) | [1] | (7,801) | [1] |
Profit / (loss) before tax from continuing operations | (248) | 328 | [1],[2] | 288 | [1],[2] |
Income tax expense | (477) | (397) | (615) | ||
Profit / (loss) for the period | 362 | (534) | [1],[3],[4] | 2,420 | [1],[3] |
Total comprehensive income / (loss) | (525) | (1,190) | [3] | 2,312 | [3] |
Attributed to NCIs | (387) | (109) | [3] | (79) | [3] |
Kar-Tel | |||||
Summarized income statement | |||||
Operating revenue | 410 | 348 | 308 | ||
Operating expenses | (319) | (296) | (255) | ||
Other (expenses) / income | 6 | (7) | 2 | ||
Profit / (loss) before tax from continuing operations | 97 | 45 | 55 | ||
Income tax expense | (20) | (13) | (14) | ||
Profit / (loss) for the period | 77 | 32 | 41 | ||
Total comprehensive income / (loss) | 77 | 32 | 41 | ||
Attributed to NCIs | 19 | 8 | 10 | ||
Sky Mobile | |||||
Summarized income statement | |||||
Operating revenue | 81 | 108 | 136 | ||
Operating expenses | (144) | (97) | (162) | ||
Other (expenses) / income | 0 | (2) | (12) | ||
Profit / (loss) before tax from continuing operations | (63) | 9 | (38) | ||
Income tax expense | (1) | (4) | (5) | ||
Profit / (loss) for the period | (64) | 5 | (43) | ||
Total comprehensive income / (loss) | (64) | 5 | (43) | ||
Attributed to NCIs | (32) | 3 | (21) | ||
GTH | |||||
Summarized income statement | |||||
Operating revenue | 2,828 | 3,015 | 2,955 | ||
Operating expenses | (2,810) | (2,421) | (2,463) | ||
Other (expenses) / income | (377) | (450) | (213) | ||
Profit / (loss) before tax from continuing operations | (359) | 144 | 279 | ||
Income tax expense | (124) | (375) | (144) | ||
Profit / (loss) for the period | (483) | (231) | 135 | ||
Total comprehensive income / (loss) | (483) | (231) | 135 | ||
Attributed to NCIs | (204) | (56) | 116 | ||
Dividends paid to NCIs | 80 | 116 | |||
OTA | |||||
Summarized income statement | |||||
Operating revenue | 813 | 915 | 1,040 | ||
Operating expenses | (754) | (703) | (753) | ||
Other (expenses) / income | (11) | (27) | (33) | ||
Profit / (loss) before tax from continuing operations | 48 | 185 | 254 | ||
Income tax expense | (47) | (49) | (69) | ||
Profit / (loss) for the period | 1 | 136 | 185 | ||
Total comprehensive income / (loss) | 1 | 136 | 185 | ||
Attributed to NCIs | 1 | 100 | $ 141 | ||
Dividends paid to NCIs | $ 76 | $ 82 | |||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[2] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[3] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||
[4] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INVESTMENTS IN SUBSIDIARIES -_2
INVESTMENTS IN SUBSIDIARIES - Summarized statement of financial position (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement of financial position | ||||||
Property and equipment | $ 4,932 | $ 6,237 | [1] | $ 6,719 | ||
Intangible assets | 1,854 | 2,168 | [1] | 2,257 | ||
Other non-current assets | 193 | 263 | [1] | |||
Cash and cash equivalents | 1,808 | 1,314 | [1] | |||
Other current assets | 479 | 648 | [1] | |||
Financial liabilities | (7,856) | (11,630) | ||||
Total equity | (2,779) | $ (3,947) | (3,890) | [1],[2] | $ (6,043) | $ (3,894) |
Equity holders of the parent | 3,670 | 4,331 | [1] | |||
Non-controlling interests | (891) | (441) | [1] | |||
Kar-Tel | ||||||
Statement of financial position | ||||||
Property and equipment | 192 | 184 | ||||
Intangible assets | 69 | 92 | ||||
Other non-current assets | 177 | 204 | ||||
Trade and other receivables | 13 | 22 | ||||
Cash and cash equivalents | 29 | 14 | ||||
Other current assets | 15 | 74 | ||||
Provisions | (4) | (5) | ||||
Other liabilities | (85) | (84) | ||||
Total equity | 406 | 501 | ||||
Equity holders of the parent | 178 | 249 | ||||
Non-controlling interests | 228 | 252 | ||||
Sky Mobile | ||||||
Statement of financial position | ||||||
Property and equipment | 76 | 79 | ||||
Intangible assets | 10 | 12 | ||||
Other non-current assets | 55 | 131 | ||||
Trade and other receivables | 3 | 6 | ||||
Cash and cash equivalents | 43 | 32 | ||||
Other current assets | 12 | 12 | ||||
Provisions | (2) | (4) | ||||
Other liabilities | (19) | (22) | ||||
Total equity | 178 | 246 | ||||
Equity holders of the parent | 45 | 79 | ||||
Non-controlling interests | 133 | 167 | ||||
GTH | ||||||
Statement of financial position | ||||||
Property and equipment | 1,652 | 2,166 | ||||
Intangible assets | 1,042 | 1,324 | ||||
Other non-current assets | 1,766 | 2,094 | ||||
Trade and other receivables | 263 | 260 | ||||
Cash and cash equivalents | 420 | 385 | ||||
Other current assets | 317 | 363 | ||||
Financial liabilities | (2,938) | (3,072) | ||||
Provisions | (312) | (348) | ||||
Other liabilities | (1,690) | (1,865) | ||||
Total equity | 520 | 1,307 | ||||
Equity holders of the parent | 1,710 | 2,100 | ||||
Non-controlling interests | (1,190) | (793) | ||||
OTA | ||||||
Statement of financial position | ||||||
Property and equipment | 498 | 517 | ||||
Intangible assets | 214 | 291 | ||||
Other non-current assets | 1,178 | 1,361 | ||||
Trade and other receivables | 48 | 31 | ||||
Cash and cash equivalents | 53 | 125 | ||||
Other current assets | 88 | 66 | ||||
Financial liabilities | (63) | (128) | ||||
Provisions | (25) | (31) | ||||
Other liabilities | (355) | (400) | ||||
Total equity | 1,636 | 1,832 | ||||
Equity holders of the parent | 545 | 597 | ||||
Non-controlling interests | $ 1,091 | $ 1,235 | ||||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | |||||
[2] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
INVESTMENTS IN SUBSIDIARIES -_3
INVESTMENTS IN SUBSIDIARIES - Summarized statement of cash flows (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Investments in subsidiaries | |||||
Net operating cash flows | $ 2,515 | $ 2,475 | [1] | $ 1,875 | [1] |
Net investing cash flows | 1,997 | (3,016) | [1] | (2,671) | [1] |
Net financing cash flows | (3,916) | (733) | [1] | (126) | [1] |
Effect of exchange rate changes on cash and cash equivalents | (119) | (354) | [1] | (64) | [1] |
Kar-Tel | |||||
Investments in subsidiaries | |||||
Net operating cash flows | 148 | 105 | 99 | ||
Net investing cash flows | (42) | (73) | (124) | ||
Net financing cash flows | (90) | (48) | (83) | ||
Effect of exchange rate changes on cash and cash equivalents | (3) | 1 | |||
Net increase / (decrease) in cash equivalents | 13 | (16) | (107) | ||
Sky Mobile | |||||
Investments in subsidiaries | |||||
Net operating cash flows | 29 | 23 | 58 | ||
Net investing cash flows | (18) | (24) | 45 | ||
Net financing cash flows | (115) | ||||
Effect of exchange rate changes on cash and cash equivalents | (1) | ||||
Net increase / (decrease) in cash equivalents | 11 | (1) | (13) | ||
GTH | |||||
Investments in subsidiaries | |||||
Net operating cash flows | 900 | 877 | 1,077 | ||
Net investing cash flows | (695) | (924) | (473) | ||
Net financing cash flows | (110) | (157) | (492) | ||
Effect of exchange rate changes on cash and cash equivalents | (60) | (18) | (14) | ||
Net increase / (decrease) in cash equivalents | 35 | (222) | 98 | ||
OTA | |||||
Investments in subsidiaries | |||||
Net operating cash flows | 245 | 345 | 446 | ||
Net investing cash flows | (118) | (172) | (238) | ||
Net financing cash flows | (193) | (350) | (288) | ||
Effect of exchange rate changes on cash and cash equivalents | (5) | (7) | (14) | ||
Net increase / (decrease) in cash equivalents | $ (71) | $ (184) | $ (94) | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
FINANCIAL ASSETS AND LIABILIT_3
FINANCIAL ASSETS AND LIABILITIES - Financial assets (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | |
FINANCIAL ASSETS | |||
Carrying value | $ 146 | $ 1,164 | |
Fair value | 146 | 1,164 | |
Non-current | 58 | 34 | |
Current | 88 | 1,130 | [1] |
Financial assets at fair value through profit or loss | |||
FINANCIAL ASSETS | |||
Carrying value | 98 | 81 | |
Fair value | 98 | 81 | |
Financial assets at fair value through profit or loss | Derivatives not designated as hedges | |||
FINANCIAL ASSETS | |||
Carrying value | 14 | 10 | |
Fair value | 14 | 10 | |
Financial assets at fair value through profit or loss | Derivatives designated as net investment hedges | |||
FINANCIAL ASSETS | |||
Carrying value | 45 | 0 | |
Fair value | 45 | 0 | |
Financial assets at fair value through profit or loss | Investments in debt instruments | |||
FINANCIAL ASSETS | |||
Carrying value | 36 | 71 | |
Fair value | 36 | 71 | |
Financial assets at fair value through profit or loss | Other | |||
FINANCIAL ASSETS | |||
Carrying value | 3 | 0 | |
Fair value | 3 | 0 | |
Financial assets at amortized cost | |||
FINANCIAL ASSETS | |||
Carrying value | 48 | 1,083 | |
Fair value | 48 | 1,083 | |
Financial assets at amortized cost | Cash pledged as collateral | |||
FINANCIAL ASSETS | |||
Carrying value | 31 | 998 | |
Fair value | 31 | 998 | |
Financial assets at amortized cost | Other investments | |||
FINANCIAL ASSETS | |||
Carrying value | 17 | 85 | |
Fair value | $ 17 | $ 85 | |
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
FINANCIAL ASSETS AND LIABILIT_4
FINANCIAL ASSETS AND LIABILITIES - Financial liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 | |
FINANCIAL LIABILITIES | |||
Carrying value | $ 7,856 | $ 11,630 | |
Fair value | 7,920 | 12,110 | |
Non-current | 6,567 | 10,362 | [1] |
Current | 1,289 | 1,268 | [1] |
Financial liabilities at fair value through profit or loss | |||
FINANCIAL LIABILITIES | |||
Carrying value | 107 | 109 | |
Fair value | 107 | 109 | |
Financial liabilities at fair value through profit or loss | Derivatives not designated as hedges | |||
FINANCIAL LIABILITIES | |||
Carrying value | 65 | 0 | |
Fair value | 65 | 0 | |
Financial liabilities at fair value through profit or loss | Derivatives designated as net investment hedges | |||
FINANCIAL LIABILITIES | |||
Carrying value | 0 | 59 | |
Fair value | 0 | 59 | |
Financial liabilities at fair value through profit or loss | Contingent consideration | |||
FINANCIAL LIABILITIES | |||
Carrying value | 40 | 49 | |
Fair value | 40 | 49 | |
Financial liabilities at fair value through profit or loss | Other | |||
FINANCIAL LIABILITIES | |||
Carrying value | 2 | 1 | |
Fair value | 2 | 1 | |
Financial liabilities at amortized cost | Principal amount outstanding | |||
FINANCIAL LIABILITIES | |||
Carrying value | 7,298 | 11,103 | |
Fair value | 7,349 | 11,548 | |
Financial liabilities at amortized cost | Interest accrued | |||
FINANCIAL LIABILITIES | |||
Carrying value | 81 | 129 | |
Fair value | 81 | 130 | |
Financial liabilities at amortized cost | Discounts, unamortized fees, hedge basis adjustment | |||
FINANCIAL LIABILITIES | |||
Carrying value | (13) | (34) | |
Financial liabilities at amortized cost | Bank loans and bonds | |||
FINANCIAL LIABILITIES | |||
Carrying value | 7,366 | 11,198 | |
Fair value | 7,430 | 11,678 | |
Financial liabilities at amortized cost | Put-option liability over non-controlling interest | |||
FINANCIAL LIABILITIES | |||
Carrying value | 306 | 310 | |
Fair value | 306 | 310 | |
Financial liabilities at amortized cost | Other financial liabilities | |||
FINANCIAL LIABILITIES | |||
Carrying value | 77 | 13 | |
Fair value | 77 | 13 | |
Financial liabilities at amortized cost | Financial liabilities at amortised cost, class | |||
FINANCIAL LIABILITIES | |||
Carrying value | 7,749 | 11,521 | |
Fair value | $ 7,813 | $ 12,001 | |
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
FINANCIAL ASSETS AND LIABILIT_5
FINANCIAL ASSETS AND LIABILITIES - Bank loans and bonds (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Bank loans and bonds | ||
Principal amount outstanding | $ 7,298 | $ 11,103 |
Loan 8.75-10.0% | ||
Bank loans and bonds | ||
Principal amount outstanding | 2,051 | 2,474 |
Notes 5.2-5.95% | ||
Bank loans and bonds | ||
Principal amount outstanding | 1,100 | 1,554 |
Notes 3.95-4.95% | ||
Bank loans and bonds | ||
Principal amount outstanding | 1,133 | 1,500 |
Loan 1.9-2.75% | ||
Bank loans and bonds | ||
Principal amount outstanding | $ 0 | 752 |
Notes 7.5% | ||
Bank loans and bonds | ||
Interest rate | 7.50% | |
Principal amount outstanding | $ 417 | 628 |
Syndicated loan | ||
Bank loans and bonds | ||
Principal amount outstanding | $ 0 | 250 |
Notes 9% | ||
Bank loans and bonds | ||
Interest rate | 9.00% | |
Principal amount outstanding | $ 0 | 208 |
Notes 6.25-7.25% | ||
Bank loans and bonds | ||
Principal amount outstanding | $ 1,200 | 1,200 |
Eurobonds | ||
Bank loans and bonds | ||
Interest rate | 7.748% | |
Principal amount outstanding | $ 262 | 543 |
Loan 0.35-0.8% | ||
Bank loans and bonds | ||
Principal amount outstanding | 256 | 379 |
Loan 1.9% | ||
Bank loans and bonds | ||
Principal amount outstanding | $ 137 | 212 |
Senior notes 8.6% | ||
Bank loans and bonds | ||
Interest rate | 8.60% | |
Principal amount outstanding | $ 300 | 300 |
Loan 3.0-4.25% | ||
Bank loans and bonds | ||
Principal amount outstanding | 146 | 0 |
Other loans | ||
Bank loans and bonds | ||
Principal amount outstanding | $ 296 | $ 1,103 |
Minimum | Loan 8.75-10.0% | ||
Bank loans and bonds | ||
Interest rate | 8.75% | |
Minimum | Notes 5.2-5.95% | ||
Bank loans and bonds | ||
Interest rate | 5.20% | |
Minimum | Notes 3.95-4.95% | ||
Bank loans and bonds | ||
Interest rate | 3.95% | |
Minimum | Notes 6.25-7.25% | ||
Bank loans and bonds | ||
Interest rate | 6.25% | |
Minimum | Eurobonds | ||
Bank loans and bonds | ||
Interest rate | 7.748% | |
Maximum | Loan 8.75-10.0% | ||
Bank loans and bonds | ||
Interest rate | 10.00% | |
Maximum | Notes 5.2-5.95% | ||
Bank loans and bonds | ||
Interest rate | 5.95% | |
Maximum | Notes 3.95-4.95% | ||
Bank loans and bonds | ||
Interest rate | 4.95% | |
Maximum | Notes 6.25-7.25% | ||
Bank loans and bonds | ||
Interest rate | 7.25% | |
Maximum | Eurobonds | ||
Bank loans and bonds | ||
Interest rate | 9.10% | |
3m EURIBOR | Minimum | Loan 1.9-2.75% | ||
Bank loans and bonds | ||
Spread on interest rate basis | 1.90% | |
3m EURIBOR | Maximum | Loan 1.9-2.75% | ||
Bank loans and bonds | ||
Spread on interest rate basis | 2.75% | |
1m LIBOR | Syndicated loan | ||
Bank loans and bonds | ||
Spread on interest rate basis | 2.25% | |
6m LIBOR | Loan 1.9% | ||
Bank loans and bonds | ||
Spread on interest rate basis | 1.90% | |
6m KIBOR | Minimum | Loan 0.35-0.8% | ||
Bank loans and bonds | ||
Spread on interest rate basis | 0.35% | |
6m KIBOR | Maximum | Loan 0.35-0.8% | ||
Bank loans and bonds | ||
Spread on interest rate basis | 0.80% | |
Average bank deposit rate | Minimum | Loan 3.0-4.25% | ||
Bank loans and bonds | ||
Spread on interest rate basis | 0.30% | |
Average bank deposit rate | Maximum | Loan 3.0-4.25% | ||
Bank loans and bonds | ||
Spread on interest rate basis | 4.25% |
FINANCIAL ASSETS AND LIABILIT_6
FINANCIAL ASSETS AND LIABILITIES - Termination of guarantees (Details) - USD ($) $ in Millions | Nov. 13, 2018 | Jun. 30, 2017 |
2023 Notes | ||
Bank loans and bonds | ||
Interest rate | 5.95% | |
Financial guarantee contracts | RUB Notes | ||
Bank loans and bonds | ||
Facility amount | $ 12,000 | |
Interest rate | 9.00% | |
Financial guarantee contracts | 2019 Notes | ||
Bank loans and bonds | ||
Facility amount | $ 600 | |
Interest rate | 5.20% | |
Financial guarantee contracts | 2023 Notes | ||
Bank loans and bonds | ||
Facility amount | $ 1,000 | |
Interest rate | 5.95% |
FINANCIAL ASSETS AND LIABILIT_7
FINANCIAL ASSETS AND LIABILITIES - Reconciliation of cash flows from financing activities (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Jun. 29, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | ||||
Cash flows | |||||||
Proceeds from borrowings, net of fees paid | [1] | $ 807 | $ 6,193 | [2] | $ 1,882 | [2] | |
Repayment of borrowings | (4,122) | (5,948) | [2] | (1,816) | [2] | ||
Non-cash movements | |||||||
Loss on early debt redemption | $ 124 | 30 | 124 | ||||
Principal amount outstanding | |||||||
Reconciliation of cash flows from financing activities | |||||||
Financing activities at beginning of period | 11,198 | 10,702 | |||||
Cash flows | |||||||
Proceeds from borrowings, net of fees paid | 807 | 6,193 | |||||
Repayment of borrowings | (4,122) | (5,948) | |||||
Interest paid | (736) | (834) | |||||
Non-cash movements | |||||||
Interest expense | 738 | 774 | |||||
Early redemption premium accrued | 44 | 168 | |||||
Foreign currency translation | (573) | 138 | |||||
Other non-cash movements | 10 | 5 | |||||
Financing activities at end of period | $ 7,366 | $ 11,198 | $ 10,702 | ||||
[1] | ** Fees paid for borrowings were US$64 (2017: US$56, 2016: US$31) | ||||||
[2] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
FINANCIAL ASSETS AND LIABILIT_8
FINANCIAL ASSETS AND LIABILITIES - Issuance of New Notes and Cash Tender Offer for Certain Outstanding Debt Securities (Details) - USD ($) | Dec. 17, 2018 | Jun. 29, 2017 | Dec. 31, 2018 | Dec. 31, 2017 | Nov. 13, 2018 | Jun. 30, 2017 | May 30, 2017 |
Bank loans and bonds | |||||||
Total outstanding amount | $ 7,298,000,000 | $ 11,103,000,000 | |||||
Loss on early debt redemption | $ 124,000,000 | $ 30,000,000 | $ 124,000,000 | ||||
Aggregate principal amount repurchased | $ 1,147,000,000 | $ 1,259,000,000 | |||||
2021 Notes | |||||||
Bank loans and bonds | |||||||
Total outstanding amount | $ 1,000,000,000 | ||||||
Interest rate | 7.748% | ||||||
2022 Notes | |||||||
Bank loans and bonds | |||||||
Total outstanding amount | $ 1,500,000,000 | ||||||
Interest rate | 7.5043% | ||||||
2023 Notes | |||||||
Bank loans and bonds | |||||||
Total outstanding amount | $ 1,000,000,000 | ||||||
Interest rate | 5.95% | ||||||
Senior Notes Due 2024 | |||||||
Bank loans and bonds | |||||||
Total outstanding amount | $ 900,000,000 | ||||||
Interest rate | 4.95% | 4.95% | |||||
Maximum tender amount | $ 400,000,000 | ||||||
Facility amount | $ 900,000,000 | ||||||
2018 Notes | |||||||
Bank loans and bonds | |||||||
Total outstanding amount | $ 1,000,000,000 | ||||||
Interest rate | 9.125% | ||||||
Senior Notes Due 2021 | |||||||
Bank loans and bonds | |||||||
Interest rate | 3.95% | ||||||
Facility amount | $ 600,000,000 |
FINANCIAL ASSETS AND LIABILIT_9
FINANCIAL ASSETS AND LIABILITIES - Reconciliation of movements relating to financial instruments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
The reconciliation of movements relating to financial instruments | |||
Beginning balance, assets | $ 1,164 | ||
Impairment loss | (858) | $ (66) | $ (204) |
Ending balance, assets | 146 | 1,164 | |
Beginning balance, liabilities | 12,110 | ||
Ending balance, liabilities | 7,920 | 12,110 | |
Contingent consideration | Level 3 | Financial instruments at fair value | |||
The reconciliation of movements relating to financial instruments | |||
Beginning balance, liabilities | 49 | 47 | |
Change in fair value recognized in the income statement | (9) | 2 | |
Ending balance, liabilities | 40 | 49 | 47 |
Investments in debt instruments | Level 3 | Financial instruments at fair value | |||
The reconciliation of movements relating to financial instruments | |||
Beginning balance, assets | 0 | 29 | |
Impairment loss | (20) | ||
Change in fair value recognized in the income statement | 0 | (9) | |
Ending balance, assets | $ 0 | $ 0 | $ 29 |
FINANCIAL ASSETS AND LIABILI_10
FINANCIAL ASSETS AND LIABILITIES - Hedge accounting (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Available facilities | ||
Derivative, hedge ratio | 100.00% | |
Cross currency swaps | Net investment hedge accounting | ||
Available facilities | ||
Aggregated designated nominal value of hedged items, million | $ 0 | $ 537 |
Notional exchange amount | 600 | |
Euro-denominated loans | Net investment hedge accounting | ||
Available facilities | ||
Aggregated designated nominal value of hedged items, million | 0 | 627 |
Foreign currency forward contracts | Net investment hedge accounting | ||
Available facilities | ||
Aggregated designated nominal value of hedged items, million | $ 68,639 | $ 0 |
Weighted average term of contract | 2 years |
FINANCIAL ASSETS AND LIABILI_11
FINANCIAL ASSETS AND LIABILITIES - Impact of hedge accounting on equity (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | |||
Disclosure of risk management strategy related to hedge accounting [line items] | ||||
Equity at beginning of period | $ 3,890 | [1],[2] | $ 6,043 | |
Equity at end of period | 2,779 | 3,890 | [1],[2] | |
Foreign currency translation reserve | ||||
Disclosure of risk management strategy related to hedge accounting [line items] | ||||
Equity at beginning of period | (7,667) | [1] | (7,109) | |
Foreign currency revaluation of the foreign operations and other | (753) | (433) | ||
Effective portion of foreign currency revaluation of the hedging instruments | 83 | (125) | ||
Change in fair value of foreign currency basis spreads | 0 | |||
Amortization of time-period related foreign currency basis spreads | 0 | |||
Net investment hedge amount reclassified to profit or loss – sale of Italy Joint Venture | 80 | |||
Disposal of subsidiaries – reclassification to profit or loss | (159) | |||
Equity at end of period | (8,416) | (7,667) | [1] | |
Cost of hedging reserve | ||||
Disclosure of risk management strategy related to hedge accounting [line items] | ||||
Equity at beginning of period | 0 | 0 | ||
Foreign currency revaluation of the foreign operations and other | 0 | 0 | ||
Effective portion of foreign currency revaluation of the hedging instruments | 0 | 0 | ||
Change in fair value of foreign currency basis spreads | (4) | |||
Amortization of time-period related foreign currency basis spreads | 5 | |||
Net investment hedge amount reclassified to profit or loss – sale of Italy Joint Venture | 4 | |||
Disposal of subsidiaries – reclassification to profit or loss | 0 | |||
Equity at end of period | $ 5 | $ 0 | ||
[1] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | |||
[2] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
FINANCIAL ASSETS AND LIABILI_12
FINANCIAL ASSETS AND LIABILITIES - Offsetting financial assets and liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Other financial liabilities (non-current) | ||
Net financial liabilities | ||
Gross amounts recognized | $ 6,567 | $ 10,362 |
Net amounts presented in the statement of financial position | 6,567 | 10,362 |
Net amount | 6,567 | 10,362 |
Other financial liabilities (current) | ||
Net financial liabilities | ||
Gross amounts recognized | 1,289 | 1,268 |
Net amounts presented in the statement of financial position | 1,289 | 1,268 |
Net amount | 1,289 | 1,268 |
Trade and other payables | ||
Net financial liabilities | ||
Gross amounts recognized | 1,472 | 1,595 |
Gross amounts set off in the statement of financial position | (40) | (72) |
Net amounts presented in the statement of financial position | 1,432 | 1,523 |
Net amount | 1,432 | 1,523 |
Other financial assets (non-current) | ||
Net financial assets | ||
Gross amounts recognized | 58 | 34 |
Net amounts presented in the statement of financial position | 58 | 34 |
Net Amount | 58 | 34 |
Other financial assets (current) | ||
Net financial assets | ||
Gross amounts recognized | 88 | 1,130 |
Net amounts presented in the statement of financial position | 88 | 1,130 |
Net Amount | 88 | 1,130 |
Trade and other receivables | ||
Net financial assets | ||
Gross amounts recognized | 617 | 817 |
Gross amounts set off in the statement of financial position | (40) | (72) |
Net amounts presented in the statement of financial position | 577 | 745 |
Net Amount | $ 577 | $ 745 |
CASH AND CASH EQUIVALENTS (Deta
CASH AND CASH EQUIVALENTS (Details) - USD ($) | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | [2] | Dec. 31, 2015 | [2] | |
Cash and cash equivalents [abstract] | |||||||
Cash and cash equivalents at banks and on hand | $ 756,000,000 | $ 850,000,000 | |||||
Cash equivalents with original maturity of less than three months | 1,052,000,000 | 464,000,000 | |||||
Cash and cash equivalents | 1,808,000,000 | 1,314,000,000 | [1] | ||||
Less overdrafts | (17,000,000) | 0 | |||||
Cash and cash equivalents, net of overdrafts, as presented in the consolidated statement of cash flows | 1,791,000,000 | 1,314,000,000 | [2] | $ 2,942,000,000 | $ 3,614,000,000 | ||
Restricted cash | 0 | 0 | |||||
Investments in money market funds | 349,000,000 | 91,000,000 | |||||
Less overdrafts | $ 17,000,000 | $ 0 | |||||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||||
[2] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
FINANCIAL RISK MANAGEMENT - Int
FINANCIAL RISK MANAGEMENT - Interest rate risk (Details) | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
INTEREST RATE RISK | ||
FINANCIAL RISK MANAGEMENT | ||
Percent of borrowings that are at a fixed rate of interest | 91.00% | 80.00% |
Interest rate appreciation risk | ||
FINANCIAL RISK MANAGEMENT | ||
Percentage of change in significant exposure used for sensitivity analysis | 100.00% | 100.00% |
Interest rate depreciation risk | ||
FINANCIAL RISK MANAGEMENT | ||
Percentage of change in significant exposure used for sensitivity analysis | 100.00% | 100.00% |
FINANCIAL RISK MANAGEMENT - For
FINANCIAL RISK MANAGEMENT - Foreign currency risk (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Risk of exchange rate depreciation | ||
Foreign currency sensitivity | ||
Change in foreign exchange rate against US$ | 10.00% | 10.00% |
Risk of exchange rate appreciation | ||
Foreign currency sensitivity | ||
Change in foreign exchange rate against US$ | 10.00% | 10.00% |
Euro | Risk of exchange rate depreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | $ (2) | $ (18) |
Effect on other comprehensive income | 132 | |
Euro | Risk of exchange rate appreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | 3 | 20 |
Effect on other comprehensive income | (145) | |
Russian Ruble | Risk of exchange rate depreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | (32) | 44 |
Effect on other comprehensive income | 70 | |
Russian Ruble | Risk of exchange rate appreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | 35 | (48) |
Effect on other comprehensive income | (77) | |
Bangladeshi Taka | Risk of exchange rate depreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | (76) | (69) |
Bangladeshi Taka | Risk of exchange rate appreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | 83 | 76 |
Pakistani Rupee | Risk of exchange rate depreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | (19) | (27) |
Pakistani Rupee | Risk of exchange rate appreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | 20 | 30 |
Georgian Lari | Risk of exchange rate depreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | (34) | (32) |
Georgian Lari | Risk of exchange rate appreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | 37 | 35 |
Other currencies | Risk of exchange rate depreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | 0 | (11) |
Other currencies | Risk of exchange rate appreciation | ||
Foreign currency sensitivity | ||
Effect on profit / (loss) before tax | $ 0 | $ 12 |
FINANCIAL RISK MANAGEMENT - Liq
FINANCIAL RISK MANAGEMENT - Liquidity risk (Details) ₽ in Millions, ₨ in Millions, ৳ in Millions, $ in Millions | Dec. 31, 2018USD ($) | Dec. 31, 2018PKR (₨) | Dec. 31, 2017USD ($) | Dec. 31, 2017RUB (₽) | Dec. 31, 2017BDT (৳) | Dec. 31, 2017PKR (₨) |
VEON Holdings B.V. – Revolving Credit Facility | ||||||
Available facilities | ||||||
Facility amount | $ 1,688 | $ 1,688 | ||||
Utilized | 250 | |||||
Available | 1,688 | 1,438 | ||||
Reduced facility amount | 1,586 | |||||
VEON Holdings B.V. – Term Loan Facility | ||||||
Available facilities | ||||||
Facility amount | 781 | ₽ 45,000 | ||||
Utilized | 520 | 30,000 | ||||
Available | 261 | ₽ 15,000 | ||||
Banglalink Digital Communications Ltd. – Syndicated Term Loan Facility | ||||||
Available facilities | ||||||
Facility amount | 353 | ৳ 29,300 | ||||
Available | 353 | ৳ 29,300 | ||||
Pakistan Mobile Communications Limited - Syndicated Term Loan Facility | ||||||
Available facilities | ||||||
Facility amount | 191 | ₨ 26,750 | 242 | ₨ 26,750 | ||
Utilized | 122 | 17,000 | 154 | 17,000 | ||
Available | 69 | 9,750 | 88 | 9,750 | ||
Pakistan Mobile Communications Limited - Term Loan Facility | ||||||
Available facilities | ||||||
Facility amount | 72 | 10,000 | 90 | 10,000 | ||
Utilized | 39 | 5,463 | 45 | 5,000 | ||
Available | 33 | ₨ 4,537 | $ 45 | ₨ 5,000 | ||
Veon Holdings B.v. Revolving Credit Facility, available until February 2021 | ||||||
Available facilities | ||||||
Reduced facility amount | 1,586 | |||||
Veon Holdings B.v. Revolving Credit Facility, available until February 2022 | ||||||
Available facilities | ||||||
Reduced facility amount | $ 1,382 | |||||
LIQUIDITY RISK | ||||||
Available facilities | ||||||
Percentage of debt that will mature in less than one year | 17.00% | 17.00% | 10.00% | 10.00% | 10.00% | 10.00% |
FINANCIAL RISK MANAGEMENT - L_2
FINANCIAL RISK MANAGEMENT - Liquidity risk maturity profile (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | $ 10,617 | $ 15,639 |
Related derivative financial assets | 34 | (5) |
Total financial liabilities, net of derivative assets | 10,651 | 15,634 |
Bank loans and bonds | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 8,784 | 13,735 |
Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | (422) | (98) |
Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 462 | 107 |
Trade and other payables | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 1,425 | 1,523 |
Other financial liabilities | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 62 | 62 |
Warid non-controlling interest put option liability | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 306 | 310 |
Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | (1,240) | (275) |
Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | 1,274 | 270 |
Less than 1 year | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 3,148 | 3,377 |
Related derivative financial assets | (14) | (5) |
Total financial liabilities, net of derivative assets | 3,134 | 3,372 |
Less than 1 year | Bank loans and bonds | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 1,697 | 1,862 |
Less than 1 year | Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | (368) | (37) |
Less than 1 year | Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 394 | 29 |
Less than 1 year | Trade and other payables | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 1,425 | 1,523 |
Less than 1 year | Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | (300) | (275) |
Less than 1 year | Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | 286 | 270 |
1-3 years | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 4,248 | 4,491 |
Related derivative financial assets | 24 | |
Total financial liabilities, net of derivative assets | 4,272 | 4,491 |
1-3 years | Bank loans and bonds | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 3,866 | 4,141 |
1-3 years | Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | (54) | (49) |
1-3 years | Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 68 | 27 |
1-3 years | Other financial liabilities | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 62 | 62 |
1-3 years | Warid non-controlling interest put option liability | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 306 | 310 |
1-3 years | Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | (610) | |
1-3 years | Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | 634 | |
3-5 years | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 2,642 | 4,997 |
Related derivative financial assets | 24 | |
Total financial liabilities, net of derivative assets | 2,666 | 4,997 |
3-5 years | Bank loans and bonds | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 2,642 | 4,958 |
3-5 years | Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | (12) | |
3-5 years | Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 51 | |
3-5 years | Gross cash inflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | (330) | |
3-5 years | Gross cash outflows | ||
Maturity profile of the Group's financial liabilities | ||
Related derivative financial assets | 354 | |
More than 5 years | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | 579 | 2,774 |
Total financial liabilities, net of derivative assets | 579 | 2,774 |
More than 5 years | Bank loans and bonds | ||
Maturity profile of the Group's financial liabilities | ||
Total financial liabilities | $ 579 | $ 2,774 |
FINANCIAL RISK MANAGEMENT - Cap
FINANCIAL RISK MANAGEMENT - Capital management (Details) | 12 Months Ended |
Dec. 31, 2018 | |
CAPITAL MANAGEMENT | Maximum | |
Disclosure of risk management strategy related to hedge accounting [line items] | |
Required net debt to adjusted EBITDA | 3.5 |
ISSUED CAPITAL AND RESERVES - C
ISSUED CAPITAL AND RESERVES - Common Stock (Details) - USD ($) | Jul. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | [1] | |
ISSUED CAPITAL AND RESERVES | ||||||
Other comprehensive loss, net of tax, exchange differences on translation | $ 819,000,000 | $ 637,000,000 | [1] | $ (85,000,000) | ||
Common shares | ||||||
ISSUED CAPITAL AND RESERVES | ||||||
Authorized common shares (nominal value of US$0.001 per share) | 1,849,190,670 | 1,849,190,670 | 2,759,171,830 | |||
Issued shares | 1,756,731,135 | 1,756,731,135 | 1,756,731,135 | |||
Treasury shares | (7,603,731) | (7,603,731) | ||||
Outstanding shares | 1,749,127,404 | 1,749,127,404 | ||||
Number of authorized unissued shares canceled | 909,981,160 | |||||
Par value per share | $ 0.001 | |||||
Authorized share capital | $ 1,849,190.67 | |||||
[1] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
ISSUED CAPITAL AND RESERVES - M
ISSUED CAPITAL AND RESERVES - Major Shareholders (Details) | Dec. 31, 2018shares | Dec. 31, 2017shares |
ISSUED CAPITAL AND RESERVES | ||
Percentage of common and voting shares | 100.00% | |
Free Float (in percentage) | 0.296 | |
Shares held by Company or its subsidiaries (Treasury shares) (in percentage) | (0.40%) | |
Common shares | ||
ISSUED CAPITAL AND RESERVES | ||
Free Float | 513,454,732 | |
Treasury shares | (7,603,731) | (7,603,731) |
Outstanding shares | 1,749,127,404 | 1,749,127,404 |
Letterone [Member] | ||
ISSUED CAPITAL AND RESERVES | ||
Percentage of common and voting shares | 47.90% | |
Letterone [Member] | Common shares | ||
ISSUED CAPITAL AND RESERVES | ||
Total outstanding common shares | 840,625,001 | |
Telenor East Holding II AS (Telenor) | ||
ISSUED CAPITAL AND RESERVES | ||
Percentage of common and voting shares | 14.60% | |
Telenor East Holding II AS (Telenor) | Common shares | ||
ISSUED CAPITAL AND RESERVES | ||
Total outstanding common shares | 256,703,840 | |
Stichting Administratiekantoor Mobile Telecommunications Investor | ||
ISSUED CAPITAL AND RESERVES | ||
Percentage of common and voting shares | 8.30% | |
Stichting Administratiekantoor Mobile Telecommunications Investor | Common shares | ||
ISSUED CAPITAL AND RESERVES | ||
Total outstanding common shares | 145,947,562 | |
Transfer of shares between largest shareholders | 145,947,562 |
EARNINGS PER SHARE - Continued
EARNINGS PER SHARE - Continued operations (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Numerator: | |||||
Profit / (loss) for the period attributable to the owners of the parent | $ (397) | $ (115) | [1] | $ (439) | [1] |
Denominator: | |||||
Weighted average common shares outstanding for basic earnings per share (in millions) (in shares) | 1,749 | 1,749 | 1,749 | ||
Denominator for diluted earnings per share (in millions) (in shares) | 1,749 | 1,749 | 1,749 | ||
Basic (loss) / earnings per share (in dollars per share) | $ (0.23) | $ (0.07) | $ (0.25) | ||
Diluted (loss) / earnings per share (in dollars per share) | $ (0.23) | $ (0.07) | $ (0.25) | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
EARNINGS PER SHARE - Discontinu
EARNINGS PER SHARE - Discontinued operations (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Numerator: | |||||
Profit / (loss) for the period attributable to the owners of the parent | $ 979 | $ (390) | [1] | $ 2,767 | [1] |
Denominator: | |||||
Weighted average common shares outstanding for basic earnings per share (in millions) (in shares) | 1,749 | 1,749 | 1,749 | ||
Denominator for diluted earnings per share (in millions) (in shares) | 1,749 | 1,749 | 1,749 | ||
Basic (loss) / earnings per share (in dollars per share) | $ 0.56 | $ (0.22) | $ 1.58 | ||
Diluted (loss) / earnings per share (in dollars per share) | $ 0.56 | $ (0.22) | $ 1.58 | ||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
DIVIDENDS PAID AND PROPOSED - D
DIVIDENDS PAID AND PROPOSED - Declared (Details) - $ / shares | Feb. 25, 2019 | Aug. 02, 2018 | Feb. 22, 2018 | Aug. 03, 2017 | Dec. 31, 2018 |
Dividends [line items] | |||||
Dividends declared per share (in dollars per share) | $ 0.17 | $ 0.12 | $ 0.17 | $ 0.11 | |
Maximum | |||||
Dividends [line items] | |||||
Tax rate withholdings on dividend paid to company's ADS depositary | 15.00% |
DIVIDENDS PAID AND PROPOSED - N
DIVIDENDS PAID AND PROPOSED - Non-controlling Interests (Details) - USD ($) $ in Millions | Aug. 29, 2018 | Jul. 24, 2018 | Apr. 23, 2018 | Oct. 10, 2017 | Aug. 18, 2017 | May 15, 2017 | Feb. 16, 2017 | Jan. 25, 2017 | Dec. 31, 2018 | Dec. 31, 2017 |
Omnium Telecom Algeria S.p.A | ||||||||||
Dividends [line items] | ||||||||||
Paid or payable to non-controlling interests | $ 76 | $ 82 | ||||||||
TNS Plus LLP | ||||||||||
Dividends [line items] | ||||||||||
Paid or payable to non-controlling interests | $ 2 | $ 11 | $ 12 | $ 7 | ||||||
Rascom CJSC | ||||||||||
Dividends [line items] | ||||||||||
Paid or payable to non-controlling interests | $ 2 | |||||||||
VIP Kazakhstan Holding AG | ||||||||||
Dividends [line items] | ||||||||||
Paid or payable to non-controlling interests | $ 11 | |||||||||
VIP Kyrgyzstan Holding AG | ||||||||||
Dividends [line items] | ||||||||||
Paid or payable to non-controlling interests | $ 55 | |||||||||
Pakistan Mobile Communications Limited | ||||||||||
Dividends [line items] | ||||||||||
Dividend declared to the non-controlling interest | $ 11 | $ 54 | ||||||||
Dividend payable to non-controlling interest | $ 7 | $ 26 |
RELATED PARTIES - Transactions
RELATED PARTIES - Transactions with related parties (Details) | Jul. 03, 2018 |
Italy Joint Venture | Discontinued operations | |
Disclosure of transactions between related parties | |
Proportion of ownership interest in joint venture | 50.00% |
RELATED PARTIES - Compensation
RELATED PARTIES - Compensation to directors and senior managers of the company (Details) | 12 Months Ended | ||||
Dec. 31, 2018USD ($) | Dec. 31, 2018EUR (€) | Dec. 31, 2017USD ($) | Dec. 31, 2017EUR (€) | Dec. 31, 2016USD ($) | |
Disclosure of transactions between related parties | |||||
Short-term employee benefits | $ 33,000,000 | $ 42,000,000 | $ 37,000,000 | ||
Long-term employee benefits | 0 | 1,000,000 | 0 | ||
Share-based payments | 0 | 1,000,000 | 0 | ||
Termination benefits | 2,000,000 | 1,000,000 | 4,000,000 | ||
Total compensation to directors and senior management | 35,000,000 | 45,000,000 | $ 41,000,000 | ||
Retainer | 2,057,594 | € 1,744,166 | 1,821,155 | € 1,615,000 | |
Committees | 249,743 | 211,700 | 156,930 | 139,166 | |
Other compensation | 19,170 | 16,250 | 1,723,785 | 1,528,652 | |
Total | 2,326,507 | 1,972,116 | 3,701,870 | 3,282,818 | |
Group CEO Ursula Burns | |||||
Disclosure of transactions between related parties | |||||
Total compensation to directors and senior management | 5,553,317 | 4,707,547 | 0 | 0 | |
Base salary (incl. holiday pay) | 5,429,871 | 4,602,902 | 0 | 0 | |
Other | 123,446 | 104,645 | 0 | 0 | |
Group CEO Jean Yves Charlier | |||||
Disclosure of transactions between related parties | |||||
Share-based payments | 0 | 0 | 800,249 | 709,661 | |
Termination benefits | 1,581,076 | 1,340,278 | 0 | 0 | |
Total compensation to directors and senior management | 13,506,958 | 11,449,848 | 8,374,579 | 7,426,577 | |
Base salary (incl. holiday pay) | 2,244,426 | 1,902,600 | 2,819,125 | 2,500,000 | |
Annual incentive | 9,104,518 | 7,717,900 | 4,651,556 | 4,125,000 | |
Other | 576,938 | 489,070 | 103,649 | 91,916 | |
Group CFO Trond Westlie | |||||
Disclosure of transactions between related parties | |||||
Total compensation to directors and senior management | 1,945,273 | 1,649,008 | 428,958 | 380,400 | |
Base salary (incl. holiday pay) | 1,769,494 | 1,500,000 | 422,869 | 375,000 | |
Annual incentive | 150,186 | 127,313 | 0 | 0 | |
Other | 25,593 | 21,695 | 6,089 | 5,400 | |
Group CFO Andrew Davies | |||||
Disclosure of transactions between related parties | |||||
Termination benefits | 0 | 0 | 281,912 | 250,000 | |
Total compensation to directors and senior management | 0 | 0 | 6,966,105 | 6,177,543 | |
Base salary (incl. holiday pay) | 0 | 0 | 1,268,606 | 1,125,000 | |
Annual incentive | 0 | 0 | 3,967,405 | 3,518,295 | |
Other | 0 | 0 | 1,448,182 | 1,284,248 | |
Group COO Kjell Johnsen | |||||
Disclosure of transactions between related parties | |||||
Total compensation to directors and senior management | 1,764,117 | 1,495,442 | 0 | 0 | |
Base salary (incl. holiday pay) | 1,681,019 | 1,425,000 | 0 | 0 | |
Other | 83,098 | 70,442 | 0 | 0 | |
Group General Counsel Scott Dresser | |||||
Disclosure of transactions between related parties | |||||
Total compensation to directors and senior management | 3,027,865 | 2,566,721 | 2,180,263 | 1,933,458 | |
Base salary (incl. holiday pay) | 1,454,917 | 1,233,333 | 1,043,076 | 925,000 | |
Annual incentive | 478,824 | 405,899 | 1,102,021 | 977,272 | |
Other | 1,094,124 | 927,489 | 35,166 | 31,186 | |
Guillaume Bacuvier | |||||
Disclosure of transactions between related parties | |||||
Retainer | 123,869 | 105,000 | 0 | 0 | |
Committees | 24,774 | 21,000 | 0 | 0 | |
Total | 148,643 | 126,000 | 0 | 0 | |
Osama Bedier | |||||
Disclosure of transactions between related parties | |||||
Retainer | 123,869 | 105,000 | 0 | 0 | |
Committees | 12,387 | 10,500 | 0 | 0 | |
Total | 136,256 | 115,500 | 0 | 0 | |
Ursula Burns | |||||
Disclosure of transactions between related parties | |||||
Retainer | 491,896 | 436,213 | |||
Committees | 14,096 | 12,500 | |||
Other compensation | 1,711,209 | 1,517,500 | |||
Total | 2,217,201 | 1,966,213 | |||
Stan Chudnovsky | |||||
Disclosure of transactions between related parties | |||||
Retainer | 172,039 | 145,833 | 218,672 | 193,918 | |
Total | 172,039 | 145,833 | 218,672 | 193,918 | |
Mikhail Fridman | |||||
Disclosure of transactions between related parties | |||||
Retainer | 47,188 | 40,000 | 45,106 | 40,000 | |
Total | 47,188 | 40,000 | 45,106 | 40,000 | |
Gennady Gazin | |||||
Disclosure of transactions between related parties | |||||
Retainer | 294,925 | 250,000 | 218,818 | 194,048 | |
Committees | 77,270 | 65,500 | 62,021 | 55,000 | |
Other compensation | 5,364 | 4,757 | |||
Total | 372,195 | 315,500 | 286,203 | 253,805 | |
Andrei Gusev | |||||
Disclosure of transactions between related parties | |||||
Retainer | 47,188 | 40,000 | 45,106 | 40,000 | |
Total | 47,188 | 40,000 | 45,106 | 40,000 | |
Gunnar Holt | |||||
Disclosure of transactions between related parties | |||||
Retainer | 294,925 | 250,000 | 151,049 | 133,950 | |
Committees | 58,985 | 50,000 | 23,492 | 20,833 | |
Total | 353,910 | 300,000 | 174,541 | 154,783 | |
Sir Julian Horn-Smith | |||||
Disclosure of transactions between related parties | |||||
Retainer | 294,925 | 250,000 | 218,818 | 194,048 | |
Committees | 12,387 | 10,500 | |||
Other compensation | 5,802 | 5,145 | |||
Total | 307,312 | 260,500 | 224,620 | 199,193 | |
Nils Katla | |||||
Disclosure of transactions between related parties | |||||
Retainer | 41,346 | 36,666 | |||
Total | 41,346 | 36,666 | |||
Jørn P. Jensen | |||||
Disclosure of transactions between related parties | |||||
Retainer | 192,684 | 163,333 | 220,498 | 195,538 | |
Committees | 33,829 | 30,000 | |||
Total | 192,684 | 163,333 | 254,327 | 225,538 | |
Robert Jan van de Kraats | |||||
Disclosure of transactions between related parties | |||||
Retainer | 123,869 | 105,000 | 0 | 0 | |
Committees | 14,864 | 12,600 | 0 | 0 | |
Other compensation | 0 | 0 | 0 | 0 | |
Total | 138,733 | 117,600 | 0 | 0 | |
Guy Laurence | |||||
Disclosure of transactions between related parties | |||||
Retainer | 294,925 | 250,000 | 124,740 | 110,619 | |
Committees | 49,076 | 41,600 | 23,492 | 20,833 | |
Other compensation | 19,170 | 16,250 | 1,410 | 1,250 | |
Total | 363,171 | 307,850 | 149,642 | 132,702 | |
Alexander Pertsovsky | |||||
Disclosure of transactions between related parties | |||||
Retainer | 47,188 | 40,000 | 0 | 0 | |
Committees | 0 | 0 | 0 | 0 | |
Other compensation | 0 | 0 | 0 | 0 | |
Total | 47,188 | € 40,000 | 0 | 0 | |
Alexey M. Reznikovich | |||||
Disclosure of transactions between related parties | |||||
Retainer | 45,106 | 40,000 | |||
Total | 45,106 | € 40,000 | |||
LTI Plan | |||||
Disclosure of transactions between related parties | |||||
Total target amount granted under the plan | 107,000,000 | 127,000,000 | |||
Total carrying value of obligation under Plan | 35,000,000 | 58,000,000 | |||
Share based payment expenses included in selling, general and administrative expenses | $ 18,000,000 | $ 43,000,000 | |||
January 1, 2015 to June 30, 2018 | LTI Plan | |||||
Disclosure of transactions between related parties | |||||
Key Management Personnel Compensation, Requisite Service Period | 42 months | 42 months | |||
January 1, 2016 to June 30, 2019 | LTI Plan | |||||
Disclosure of transactions between related parties | |||||
Key Management Personnel Compensation, Requisite Service Period | 42 months | 42 months | |||
January 1, 2017 to June 30, 2020 | LTI Plan | |||||
Disclosure of transactions between related parties | |||||
Key Management Personnel Compensation, Requisite Service Period | 42 months | 42 months | |||
July 1, 2017 to December 31, 2020 | LTI Plan | |||||
Disclosure of transactions between related parties | |||||
Key Management Personnel Compensation, Requisite Service Period | 42 months | 42 months |
EVENTS AFTER THE REPORTING PE_2
EVENTS AFTER THE REPORTING PERIOD (Details) $ / shares in Units, $ in Millions | Feb. 25, 2019$ / shares | Aug. 02, 2018$ / shares | Feb. 22, 2018$ / shares | Aug. 03, 2017$ / shares | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($)$ / shares | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Feb. 10, 2019ج.م. / sharesshares | ||
Disclosure of non-adjusting events after reporting period | |||||||||||
Final dividend declared per share (in dollars per share) | $ 0.17 | ||||||||||
Aggregate dividend declared per share (in dollars per share) | $ 0.17 | $ 0.12 | $ 0.17 | $ 0.11 | |||||||
Revenue | $ | $ 9,086 | $ 9,474 | [1] | $ 8,885 | [1] | ||||||
Dividend approval by supervisory board | |||||||||||
Disclosure of non-adjusting events after reporting period | |||||||||||
Aggregate dividend declared per share (in dollars per share) | $ 0.29 | ||||||||||
Dividend (in dollars per share) | $ 0.17 | ||||||||||
Revised technology infrastructure partnership with Ericsson | |||||||||||
Disclosure of non-adjusting events after reporting period | |||||||||||
Revenue | $ | $ 350 | ||||||||||
GTH | |||||||||||
Disclosure of non-adjusting events after reporting period | |||||||||||
Revenue | $ | $ 2,828 | $ 3,015 | $ 2,955 | ||||||||
GTH | Tender offer for remainder of subsidiary | |||||||||||
Disclosure of non-adjusting events after reporting period | |||||||||||
Mandatory tender offer, number of shares (in shares) | shares | 1,997,639,608 | ||||||||||
Mandatory tender offer, percentage of ownership Interests | 42.31% | ||||||||||
Mandatory tender offer, price per share (in EGP per share) | ج.م. / shares | ج.م. 5.30 | ||||||||||
Maximum | |||||||||||
Disclosure of non-adjusting events after reporting period | |||||||||||
Tax rate withholdings on dividend paid to company's ADS depositary | 15.00% | ||||||||||
[1] | * Prior year comparatives are restated following the classification of Italy Joint Venture as a discontinued operation and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE - IFRS 9 and IFRS 15 (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | Jan. 01, 2017 | Dec. 31, 2016 | Jan. 01, 2016 | |
Non-current assets | |||||||
Investments in joint ventures and associates | $ 0 | $ 1,921 | [1] | ||||
Deferred tax assets | 197 | 336 | [1] | ||||
Other assets | 193 | 263 | [1] | ||||
Current assets | |||||||
Trade and other receivables, gross | 577 | 755 | [1] | $ 685 | |||
Allowance for doubtful debt | (171) | $ (183) | (169) | $ (160) | $ (160) | $ (182) | |
Other assets | 479 | 648 | [1] | ||||
Equity | |||||||
Equity attributable to equity owners of the parent | 3,670 | 4,331 | [1] | ||||
Non-controlling interests | (891) | (441) | [1] | ||||
Liabilities | |||||||
Other liabilities (current) | 1,290 | 1,401 | [1] | ||||
Deferred tax liabilities | 180 | 376 | [1] | ||||
December 31, 2018 | |||||||
Non-current assets | |||||||
Deferred tax assets | 197 | ||||||
Other assets | 193 | ||||||
Current assets | |||||||
Trade and other receivables, gross | 577 | ||||||
Other assets | 2,516 | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | 3,670 | ||||||
Non-controlling interests | (891) | ||||||
Liabilities | |||||||
Other liabilities (current) | 1,290 | ||||||
Deferred tax liabilities | $ 180 | ||||||
Impact of Adoption of IFRS 9 and IFRS 15 | December 31, 2018 | |||||||
Non-current assets | |||||||
Investments in joint ventures and associates | 1,921 | ||||||
Deferred tax assets | 336 | ||||||
Available for sale | 18 | ||||||
Other assets | 263 | ||||||
Current assets | |||||||
Trade and other receivables, gross | 924 | ||||||
Allowance for doubtful debt | (169) | (169) | (160) | (182) | |||
Available for sale | 53 | ||||||
Other assets | 418 | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | 4,331 | ||||||
Non-controlling interests | (441) | ||||||
Liabilities | |||||||
Other liabilities (current) | 1,353 | ||||||
Deferred tax liabilities | $ 376 | ||||||
Proforma Adjustment | Impact of Adoption of IFRS 9 and IFRS 15 | |||||||
Non-current assets | |||||||
Investments in joint ventures and associates | 1,924 | ||||||
Deferred tax assets | 326 | ||||||
Fair value through other comprehensive income | 18 | ||||||
Other assets | 356 | ||||||
Current assets | |||||||
Trade and other receivables, gross | 924 | ||||||
Allowance for doubtful debt | (183) | ||||||
Fair value through profit or loss | 20 | ||||||
Fair value through other comprehensive income | 33 | ||||||
Other assets | 414 | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | 4,377 | ||||||
Non-controlling interests | (430) | ||||||
Liabilities | |||||||
Other liabilities (current) | 1,352 | ||||||
Deferred tax liabilities | 388 | ||||||
Proforma Adjustment | Impact of Adoption of IFRS 9 and IFRS 15 | Impact of IFRS 9 - Classification and measurement | |||||||
Non-current assets | |||||||
Investments in joint ventures and associates | (25) | ||||||
Available for sale | (18) | ||||||
Fair value through other comprehensive income | 18 | ||||||
Current assets | |||||||
Available for sale | (53) | ||||||
Fair value through profit or loss | 20 | ||||||
Fair value through other comprehensive income | 33 | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | (25) | ||||||
Proforma Adjustment | Impact of Adoption of IFRS 9 and IFRS 15 | Impact of IFRS 9 - Impairment | |||||||
Non-current assets | |||||||
Investments in joint ventures and associates | (10) | ||||||
Deferred tax assets | 2 | ||||||
Current assets | |||||||
Allowance for doubtful debt | (14) | $ 0 | $ 0 | ||||
Equity | |||||||
Equity attributable to equity owners of the parent | (16) | ||||||
Non-controlling interests | (4) | ||||||
Liabilities | |||||||
Deferred tax liabilities | (2) | ||||||
Proforma Adjustment | Impact of Adoption of IFRS 9 and IFRS 15 | Impact of IFRS 15 - Revenue and contract costs | |||||||
Non-current assets | |||||||
Investments in joint ventures and associates | 38 | ||||||
Deferred tax assets | (12) | ||||||
Other assets | 93 | ||||||
Current assets | |||||||
Other assets | (4) | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | 87 | ||||||
Non-controlling interests | 15 | ||||||
Liabilities | |||||||
Other liabilities (current) | (1) | ||||||
Deferred tax liabilities | $ 14 | ||||||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE - IFRS 16 (Details) - USD ($) $ in Millions | Jan. 01, 2019 | Dec. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | [1] | Dec. 31, 2016 | Dec. 31, 2015 |
Non-current assets | |||||||
Property and equipment | $ 4,932 | $ 6,237 | $ 6,719 | ||||
Intangible assets | 1,854 | 2,168 | 2,257 | ||||
Goodwill | 3,816 | 4,618 | 4,696 | ||||
Deferred tax assets | 197 | 336 | |||||
Other assets | 193 | 263 | |||||
Total non-current assets | 10,992 | 15,543 | |||||
Current assets | |||||||
Trade and other receivables, gross | 577 | 755 | 685 | ||||
Other assets | 479 | 648 | |||||
Total current assets | 3,093 | 3,919 | |||||
Assets classified as held for sale | 17 | 22 | |||||
Total assets | 14,102 | 19,484 | |||||
Equity | |||||||
Equity attributable to equity owners of the parent | 3,670 | 4,331 | |||||
Non-controlling interests | (891) | (441) | |||||
Total equity | 2,779 | $ 3,947 | 3,890 | [2] | $ 6,043 | $ 3,894 | |
Non-current liabilities | |||||||
Financial liabilities | 6,567 | 10,362 | |||||
Provisions | 110 | 123 | |||||
Lease liabilities | 1,638 | ||||||
Deferred tax liabilities | 180 | 376 | |||||
Other liabilities | 53 | 83 | |||||
Total non-current liabilities | 6,910 | 10,944 | |||||
Current liabilities | |||||||
Trade and other payables | 1,432 | 1,544 | |||||
Other financial liabilities | 1,289 | 1,268 | |||||
Lease liabilities | 361 | ||||||
Provisions | 398 | 422 | |||||
Other liabilities | 1,290 | 1,401 | |||||
Total current liabilities | 4,409 | 4,635 | |||||
Liabilities associated with assets held for sale | 4 | 15 | |||||
Total equity and liabilities | $ 14,102 | $ 19,484 | |||||
Weighted-average incremental rate applied to lease liabilities | 9.62% | ||||||
December 31, 2018 | |||||||
Non-current assets | |||||||
Property and equipment | $ 4,932 | ||||||
Right-of-use assets | 0 | ||||||
Intangible assets | 1,854 | ||||||
Goodwill | 3,816 | ||||||
Deferred tax assets | 197 | ||||||
Other assets | 193 | ||||||
Total non-current assets | 10,992 | ||||||
Current assets | |||||||
Trade and other receivables, gross | 577 | ||||||
Other assets | 2,516 | ||||||
Total current assets | 3,093 | ||||||
Assets classified as held for sale | 17 | ||||||
Total assets | 14,102 | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | 3,670 | ||||||
Non-controlling interests | (891) | ||||||
Total equity | 2,779 | ||||||
Non-current liabilities | |||||||
Financial liabilities | 6,567 | ||||||
Provisions | 110 | ||||||
Lease liabilities | 0 | ||||||
Deferred tax liabilities | 180 | ||||||
Other liabilities | 53 | ||||||
Total non-current liabilities | 6,910 | ||||||
Current liabilities | |||||||
Trade and other payables | 1,432 | ||||||
Other financial liabilities | 1,289 | ||||||
Lease liabilities | 0 | ||||||
Provisions | 398 | ||||||
Other liabilities | 1,290 | ||||||
Total current liabilities | 4,409 | ||||||
Liabilities associated with assets held for sale | 4 | ||||||
Total equity and liabilities | $ 14,102 | ||||||
Proforma Adjustment | Impact of IFRS 16 | |||||||
Non-current assets | |||||||
Property and equipment | $ (71) | ||||||
Right-of-use assets | 2,023 | ||||||
Intangible assets | (15) | ||||||
Goodwill | 0 | ||||||
Deferred tax assets | 0 | ||||||
Other assets | (1) | ||||||
Total non-current assets | 1,936 | ||||||
Current assets | |||||||
Trade and other receivables, gross | (61) | ||||||
Other assets | 0 | ||||||
Total current assets | (61) | ||||||
Assets classified as held for sale | 4 | ||||||
Total assets | 1,879 | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | (3) | ||||||
Non-controlling interests | (1) | ||||||
Total equity | (4) | ||||||
Non-current liabilities | |||||||
Financial liabilities | (45) | ||||||
Provisions | 0 | ||||||
Lease liabilities | 1,638 | ||||||
Deferred tax liabilities | 0 | ||||||
Other liabilities | (9) | ||||||
Total non-current liabilities | 1,584 | ||||||
Current liabilities | |||||||
Trade and other payables | (54) | ||||||
Other financial liabilities | (6) | ||||||
Lease liabilities | 361 | ||||||
Provisions | (3) | ||||||
Other liabilities | (3) | ||||||
Total current liabilities | 295 | ||||||
Liabilities associated with assets held for sale | 4 | ||||||
Total equity and liabilities | 1,879 | ||||||
Proforma Adjustment | January 1, 2019 | |||||||
Non-current assets | |||||||
Property and equipment | 4,861 | ||||||
Right-of-use assets | 2,023 | ||||||
Intangible assets | 1,839 | ||||||
Goodwill | 3,816 | ||||||
Deferred tax assets | 197 | ||||||
Other assets | 192 | ||||||
Total non-current assets | 12,928 | ||||||
Current assets | |||||||
Trade and other receivables, gross | 516 | ||||||
Other assets | 2,516 | ||||||
Total current assets | 3,032 | ||||||
Assets classified as held for sale | 21 | ||||||
Total assets | 15,981 | ||||||
Equity | |||||||
Equity attributable to equity owners of the parent | 3,667 | ||||||
Non-controlling interests | (892) | ||||||
Total equity | 2,775 | ||||||
Non-current liabilities | |||||||
Financial liabilities | 6,522 | ||||||
Provisions | 110 | ||||||
Lease liabilities | 1,638 | ||||||
Deferred tax liabilities | 180 | ||||||
Other liabilities | 44 | ||||||
Total non-current liabilities | 8,494 | ||||||
Current liabilities | |||||||
Trade and other payables | 1,378 | ||||||
Other financial liabilities | 1,283 | ||||||
Lease liabilities | 361 | ||||||
Provisions | 395 | ||||||
Other liabilities | 1,287 | ||||||
Total current liabilities | 4,704 | ||||||
Liabilities associated with assets held for sale | 8 | ||||||
Total equity and liabilities | $ 15,981 | ||||||
[1] | * Prior year comparatives are restated following the retrospective reversal of reclassification of Deodar assets and liabilities as held for sale and retrospective recognition of depreciation charges in respect of Deodar (see Note 10). | ||||||
[2] | * Prior year comparatives are restated following the retrospective recognition of depreciation charges in respect of Deodar (see Note 10). |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES THAT RELATE TO THE CONSOLIDATED FINANCIAL STATEMENTS AS A WHOLE - Reconciliation of Operating Lease Commitments to Lease Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2018 | Dec. 31, 2017 |
Reconciliation Of Operating Lease Commitments To Lease Liabilities [Abstract] | ||
Operating lease commitments as of December 31, 2018 (see Note 5) | $ 632 | $ 466 |
Increase in lease commitments of cancellable leases included in reasonably certain lease term | 1,846 | |
Use of IFRS 16 practical expedients (old lease accounting continues for exceptions) | (4) | |
Leases commencing subsequent to transition date committed to as of December 31, 2018 | (47) | |
Accruals included in the lease liability calculation | 59 | |
Other | 22 | |
Total undiscounted lease payments which are reasonably certain | 2,508 | |
Discounting effect using incremental borrowing rate | (559) | |
IAS 17 finance lease liabilities recognized on balance sheet as of December 31, 2018 (discounted) | 54 | |
Expected IFRS 16 lease liability presented as | ||
Lease liabilities | 1,638 | |
Lease liabilities | 361 | |
Liabilities associated with assets held for sale | 4 | |
Lease liabilities | $ 2,003 |
Uncategorized Items - vip-20181
Label | Element | Value |
Cumulative Effect Of New Accounting Principle In Period Of Adoption | vip_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 57,000,000 |
Share premium [member] | ||
Equity | ifrs-full_Equity | 12,753,000,000 |
Reserve of exchange differences on translation [member] | ||
Equity | ifrs-full_Equity | (7,667,000,000) |
Retained earnings [member] | ||
Equity | ifrs-full_Equity | (1,440,000,000) |
Cumulative Effect Of New Accounting Principle In Period Of Adoption | vip_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 46,000,000 |
Reserve of share-based payments [member] | ||
Equity | ifrs-full_Equity | 729,000,000 |
Equity attributable to owners of parent [member] | ||
Equity | ifrs-full_Equity | 4,377,000,000 |
Cumulative Effect Of New Accounting Principle In Period Of Adoption | vip_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 46,000,000 |
Non-controlling interests [member] | ||
Equity | ifrs-full_Equity | (430,000,000) |
Cumulative Effect Of New Accounting Principle In Period Of Adoption | vip_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 11,000,000 |
Issued capital [member] | ||
Equity | ifrs-full_Equity | $ 2,000,000 |
Number of shares outstanding | ifrs-full_NumberOfSharesOutstanding | 1,749,127,404 |
Brands And Trademarks [Member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | $ 358,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 262,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 178,000,000 |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (13,000,000) |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (10,000,000) |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 83,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 74,000,000 |
Telecommunications Licenses Frequencies And Permissions [Member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 1,128,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 1,256,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 1,195,000,000 |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (42,000,000) |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (154,000,000) |
Impairment loss recognised in profit or loss, intangible assets other than goodwill | ifrs-full_ImpairmentLossRecognisedInProfitOrLossIntangibleAssetsOtherThanGoodwill | 251,000,000 |
Additions other than through business combinations, intangible assets other than goodwill | ifrs-full_AdditionsOtherThanThroughBusinessCombinationsIntangibleAssetsOtherThanGoodwill | 332,000,000 |
Additions other than through business combinations, intangible assets other than goodwill | ifrs-full_AdditionsOtherThanThroughBusinessCombinationsIntangibleAssetsOtherThanGoodwill | 526,000,000 |
Disposals and retirements, intangible assets other than goodwill | ifrs-full_DisposalsAndRetirementsIntangibleAssetsOtherThanGoodwill | 1,000,000 |
Disposals and retirements, intangible assets other than goodwill | ifrs-full_DisposalsAndRetirementsIntangibleAssetsOtherThanGoodwill | 6,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 161,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 176,000,000 |
Customer-related intangible assets [member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 337,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 255,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 177,000,000 |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (7,000,000) |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (24,000,000) |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 75,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 54,000,000 |
Computer software [member] | ||
Increase (decrease) through transfers, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughTransfersIntangibleAssetsOtherThanGoodwill | 4,000,000 |
Increase (decrease) through transfers, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughTransfersIntangibleAssetsOtherThanGoodwill | 2,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 380,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 351,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 264,000,000 |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (3,000,000) |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (32,000,000) |
Impairment loss recognised in profit or loss, intangible assets other than goodwill | ifrs-full_ImpairmentLossRecognisedInProfitOrLossIntangibleAssetsOtherThanGoodwill | 48,000,000 |
Additions other than through business combinations, intangible assets other than goodwill | ifrs-full_AdditionsOtherThanThroughBusinessCombinationsIntangibleAssetsOtherThanGoodwill | 178,000,000 |
Additions other than through business combinations, intangible assets other than goodwill | ifrs-full_AdditionsOtherThanThroughBusinessCombinationsIntangibleAssetsOtherThanGoodwill | 171,000,000 |
Disposals and retirements, intangible assets other than goodwill | ifrs-full_DisposalsAndRetirementsIntangibleAssetsOtherThanGoodwill | 2,000,000 |
Disposals and retirements, intangible assets other than goodwill | ifrs-full_DisposalsAndRetirementsIntangibleAssetsOtherThanGoodwill | 1,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 206,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 179,000,000 |
Other intangible assets [member] | ||
Increase (decrease) through transfers, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughTransfersIntangibleAssetsOtherThanGoodwill | (4,000,000) |
Increase (decrease) through transfers, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughTransfersIntangibleAssetsOtherThanGoodwill | (2,000,000) |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 54,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 44,000,000 |
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 40,000,000 |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (1,000,000) |
Increase (decrease) through net exchange differences, intangible assets other than goodwill | ifrs-full_IncreaseDecreaseThroughNetExchangeDifferencesIntangibleAssetsOtherThanGoodwill | (10,000,000) |
Additions other than through business combinations, intangible assets other than goodwill | ifrs-full_AdditionsOtherThanThroughBusinessCombinationsIntangibleAssetsOtherThanGoodwill | 8,000,000 |
Additions other than through business combinations, intangible assets other than goodwill | ifrs-full_AdditionsOtherThanThroughBusinessCombinationsIntangibleAssetsOtherThanGoodwill | 20,000,000 |
Disposals and retirements, intangible assets other than goodwill | ifrs-full_DisposalsAndRetirementsIntangibleAssetsOtherThanGoodwill | 1,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 12,000,000 |
Amortisation, intangible assets other than goodwill | ifrs-full_AmortisationIntangibleAssetsOtherThanGoodwill | 12,000,000 |
Gross carrying amount [member] | Brands And Trademarks [Member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 527,000,000 |
Gross carrying amount [member] | Telecommunications Licenses Frequencies And Permissions [Member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 2,365,000,000 |
Gross carrying amount [member] | Customer-related intangible assets [member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 1,675,000,000 |
Gross carrying amount [member] | Computer software [member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 1,006,000,000 |
Gross carrying amount [member] | Other intangible assets [member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | 254,000,000 |
Accumulated depreciation, amortisation and impairment [member] | Brands And Trademarks [Member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | (349,000,000) |
Accumulated depreciation, amortisation and impairment [member] | Telecommunications Licenses Frequencies And Permissions [Member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | (1,170,000,000) |
Accumulated depreciation, amortisation and impairment [member] | Customer-related intangible assets [member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | (1,498,000,000) |
Accumulated depreciation, amortisation and impairment [member] | Computer software [member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | (742,000,000) |
Accumulated depreciation, amortisation and impairment [member] | Other intangible assets [member] | ||
Intangible assets other than goodwill | ifrs-full_IntangibleAssetsOtherThanGoodwill | $ (214,000,000) |