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VEON CEO Quits Amid Investor GloomVEON CEO Quits Amid Investor Gloom

Chairwoman Ursula Burns will step into the CEO role until a permanent replacement for Jean-Yves Charlier can be found.

Iain Morris

March 27, 2018

3 Min Read
VEON CEO Quits Amid Investor Gloom

VEON CEO Jean-Yves Charlier has quit following a sharp fall in the operator's share price this year and with questions hanging over its digital transformation strategy.

Ursula Burns, VEON's executive chair, will step into the CEO role in a caretaker capacity until a full-time replacement has been found.

VEON, which serves 240 million customers across Russia and a number of emerging markets, gave no explanation for Charlier's departure or plans.

Having taken charge of VEON about three years ago, Charlier led the company through a bribery scandal in Uzbekistan and was also responsible for its name change from VimpelCom.

An overhaul of the company's legacy technologies and systems has been one of his priorities during the past couple of years. Besides ramping up investments in software-based and virtualized networks, VEON has also been funneling resources into a new digital app that lets customers access services from VEON as well as content partners, such as MasterCard and drinks company Red Bull. (See VEON's Digital Overhaul Much More Than Rebranding.)

Figure 1: Jean-Yves Charlier has quit as CEO of VEON. Jean-Yves Charlier has quit as CEO of VEON.

Following a hard launch of the app in September, and the rollout of new features at the end of the year, VEON said that about 8.3 million customers had downloaded the app when reporting financial results for 2017 earlier this year.

That still represents a tiny fraction of the operator's overall customer base, however, and VEON has said little about the impact of the app on financial and operational performance.

You're invited to attend Light Reading’s Big Communications Event -- the ONE event that delivers fresh perspective on the rapid transformation of the telecom industry and the road ahead. We'll see you May 14-16 in Austin -- communications service providers get in free! Investors were disappointed by last year's results after VEON swung from a net profit of $2.9 billion in 2016 to a net loss of $483 million. It blamed its loss on factors including currency devaluation, "accelerated depreciation" linked to its network modernization program and divestment activities. (See VEON Banks $940M From Axiata for Pakistani Towers.) The operator's revenues were up 6.6%, to $9.5 billion, although rising just 1.1% on an organic basis, while EBITDA grew 11%, thanks partly to sharp headcount reductions. Staff numbers fell by more than 2,000 in 2017, to less than 40,000 across the entire group. On the Nasdaq, VEON's share price has lost about a third of its value since the start of the year, closing yesterday at $2.65. Figure 2: Chairwoman Ursula Burns has stepped in as interim CEO. Chairwoman Ursula Burns has stepped in as interim CEO. In today's announcement about Charlier, VEON also revealed that Kjell Morten Johnson will step into the new role of chief operating officer on an interim basis, assisting Burns with the management of VEON's operations until a new CEO is found. Johnson currently works as VEON's head of major markets, with responsibility for the company's businesses in Russia and Italy. — Iain Morris, News Editor, Light Reading

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About the Author(s)

Iain Morris

International Editor

Iain Morris joined Light Reading as News Editor at the start of 2015 -- and we mean, right at the start. His friends and family were still singing Auld Lang Syne as Iain started sourcing New Year's Eve UK mobile network congestion statistics. Prior to boosting Light Reading's UK-based editorial team numbers (he is based in London, south of the river), Iain was a successful freelance writer and editor who had been covering the telecoms sector for the past 15 years. His work has appeared in publications including The Economist (classy!) and The Observer, besides a variety of trade and business journals. He was previously the lead telecoms analyst for the Economist Intelligence Unit, and before that worked as a features editor at Telecommunications magazine. Iain started out in telecoms as an editor at consulting and market-research company Analysys (now Analysys Mason).

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