Mobistar H1 2015 Results presentation · Q1 2014 Q2 2014 H1 2015Q3 2014 Q4 2014 H1 2015 Source:...
Transcript of Mobistar H1 2015 Results presentation · Q1 2014 Q2 2014 H1 2015Q3 2014 Q4 2014 H1 2015 Source:...
Analysts & Investors Presentation
H1 2015 FINANCIAL
RESULTS
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“Positive momentum on mobile confirmed in H1 laying a solid foundation for convergence”
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Our main business achievements in H1 2015
> Retail customer base increase in both postpaid and prepaid
> 4G population coverage grew to 95 %
> 4G+ technical trial in 3 cities and more to come
> Mobile data growth fueled by 4G penetration and usage
> Data monetization and upsell path lead to postpaid ARPU growth
> Loyalty program running at full speed and enriched services (iCoyote)
> Completion of distribution overhaul
> Answer to draft decision of regulators on wholesale cable prices
> Improved cash flow profile and leverage
> Financial results on track to meet full year guidance
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4
OUR LATEST COMMERCIAL
ACHIEVEMENTS
cinema
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Our 5 strategic priorities and ambitions
Leadership in Mobile
� Best 4G network in Belgium
� N° 1 in network share
Pioneer in Disruptive Convergence
� N° 1 convergent challenger on the consumer market
� N° 1 convergent challenger on the enterprise market
Best Customer Experience
� Best Telco customer experience
� N° 1 NPS in all customer touch points
Best Industry Efficiency
� Best in class Telco in outsourcing model
� Self finance innovation thanks to efficiency gains
Team Member’s Engagement
� Create a digital and open working environment
� Best in Class in offering career opportunities
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Outdoor 4G population coverage evolution (%)(800 + 1800 MHz)
Mobistar keeps investing in 4G coverage
9588
81
54
16
Q1 2014 Q2 2014 H1 2015Q3 2014 Q4 2014 H1 2015
Source:Mobistar internal simulations
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strong outdoor & indoor 4G coverage
Population coverage (%)
National Brussels
95
Indoor
77
Outdoor
89
99
Outdoor Indoor
Source:Mobistar internal simulations
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ahead of competition in terms of 4G coverageCoverage (%) - Driven routes (6 500 km)
Drive tests performed in June-July 2015
OUTDOOROUTDOOROUTDOOROUTDOOR DEEP & SOFT INDOORDEEP & SOFT INDOORDEEP & SOFT INDOORDEEP & SOFT INDOOR
36.6
49.2
64.2
96.2 98.2 99.2
85.4
92.4
76.3
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4G+ technical testing in progress
> Others cities to be opened before end 2015
> A better experience for all customers
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facilitating 4G access for our customersFrom network and tariff plans to devices and services
most attractive4G tariffplans
richest devices portfolio
largest 3G and 4G coverage
best services
DEVICESTARIFFSNETWORKSERVICES
&FINANCING
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loyalty program drives customer engagement and churn reduction
Loyalty Churn
X 600,000X 600,000X 600,000X 600,000(since April 2014)
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Increasing value drives customer satisfaction
>75,000 >75,000 >75,000 >75,000 activated customersactivated customersactivated customersactivated customers
> Exclusive partnership with Coyote
> Free driving assistance service for Mobistar customers as from Dolphin 20
Loyalty Churn
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retail customer base is growingrecovered commercial momentum in both postpaid and prepaid
Mobistar active customers excl. M2M & MVNOQ3 2014 prepaid excl. Colruyt MVNO internalistation
Quarterly net adds in Belgium (‘k)
-32
-20
----17171717
Q3 2014
----18181818
-19
1
----19191919
Q4 2014
-23
7
10101010
Q1 2015
-15
-5
Q2 2015
19
Q1 2014
----79797979
-37
-42
Q2 2014
----53535353
Postpaid
Prepaid
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4G customers base is growing fast
Active 4G users* share of total Mobistar subscriber base
growing customer appetite for 4G smartphones & services
*Mobistar active 4G users excl. M2M & MVNO
X 3X 3X 3X 3
X 2X 2X 2X 2
Total customers
Mobile data
customers
4G customers
Average data trafficper technology
700 000
4G users
8%
Q2 2014Q1 2014
0%
19%
23%
Q2 2015
11%
Q1 2015
16%
Q4 2014Q3 2014
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Mobistar prepaid & postpaid customers base excl. M2M & MVNO, monthly change from January 2014 to December 2014
4G customers
700,00023%
4G = ~50 % of total data consumptionNearly 1 out of every 4 Mobistar customers is using 4G
50%
50%
Mobile data consumption per technology and per customers
3G traffic per user continue increasing
Usage x4
Since 4G launch
Mobistar4G
launch
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increased data top-ups and data users4G drives customer appetite for mobile data
Significant increase of data top-ups
H1 2015H1 2014
x 4
User per tariff plan2014 & 2015 comparison
Number of users
x 2x 2x 2x 21GB1GB1GB1GB
2GB2GB2GB2GB
3GB3GB3GB3GB
4GB4GB4GB4GB
5GB5GB5GB5GB
x 3x 3x 3x 3500MB500MB500MB500MB
x 1.5x 1.5x 1.5x 1.5
x 1.5x 1.5x 1.5x 1.5
x 4x 4x 4x 4
x 4.5x 4.5x 4.5x 4.5
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4G and data usage driving postpaid ARPU growthAbility to monetize mobile data confirmed
Postpaid ARPU increased YoY in Q2 2015:
+0,6%+0,6%+0,6%+0,6%
27,9
Q2 2014 Q2 2015
27,7
+ 0.6%
Postpaid ARPU, annual rolling (incl. visitor roaming)
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2. Mobile-Fixed convergent opportunity
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JULYJULYJULYJULY SEPTSEPTSEPTSEPTAUGAUGAUGAUG OCTOCTOCTOCTJUNEJUNEJUNEJUNEMAYMAYMAYMAY
CRC new pricing conditions proposal
Consultation period Draft decision for EC (CRC) EC Consultation
CRC pricing
final decision
EC notification
EC decision
Progresses on cable network regulation
> Since end May, 4 regulators have published their new price conditions
> Market consultation ended 15/07
> Mobistar contributed to the consultation
Estimated timing
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Cable wholesale prices proposal drop 30 %but still 25 % above French benchmark
Regulators Draft Decisions (May 2015)Monthly regulated fee
New wholesale pricesNew wholesale pricesNew wholesale pricesNew wholesale pricesFormer wholesale pricesFormer wholesale pricesFormer wholesale pricesFormer wholesale prices France (Numericable)France (Numericable)France (Numericable)France (Numericable)
- 20 to - 30 %
+ 25%
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Mobistar working on quality with 600 testers
> +600 friendly +600 friendly +600 friendly +600 friendly testers activatedtesters activatedtesters activatedtesters activated
> 1/3 are external 1/3 are external 1/3 are external 1/3 are external testerstesterstesterstesters
> 60/40 on 60/40 on 60/40 on 60/40 on VOO/Telenet VOO/Telenet VOO/Telenet VOO/Telenet networknetworknetworknetwork Recommendation
Satisfaction
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4.8m households addressable via wholesale cable regulation
Households in Belgium*
* Federal Plan Office** Internal analysis based on published information by other operators
Belgium residential fixed market**In EUR bn
Fixed Voice
1,2
Fixed Internet
0,8TV1,0
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H1 2015
financial resultsLudovic Pech, CFO
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Mobistar group key financialsservice revenues and EBITDA stabilization with improved cash flow profile
in in in in €€€€mmmm H1 2015H1 2015H1 2015H1 2015 H1 2014H1 2014H1 2014H1 2014 Var. (%)Var. (%)Var. (%)Var. (%) InsightInsightInsightInsight
Service Service Service Service revenuesrevenuesrevenuesrevenues 537.1537.1537.1537.1 552.1552.1552.1552.1 ----2.7 %2.7 %2.7 %2.7 % • -0.4 % erosion before regulatory impact
Total turnoverTotal turnoverTotal turnoverTotal turnover 606.8606.8606.8606.8 629.1629.1629.1629.1 ----3.53.53.53.5 %%%% • Reflecting service revenues sequential trend
RestatedRestatedRestatedRestated EBITDAEBITDAEBITDAEBITDA 142.1142.1142.1142.1 140.4140.4140.4140.4 +1.2+1.2+1.2+1.2 %%%% • Transformation efforts allowing dynamic resourcesreallocation towards growth areas
• In line with FY guidance(in % of service revenues) 26.5% 25.4%
EBITDAEBITDAEBITDAEBITDA 140.4140.4140.4140.4 137.0137.0137.0137.0 +2.5 %+2.5 %+2.5 %+2.5 % • Lower restructuring costs (less redundancy and distribution contract termination)
• Stabilization of EBITDA(in % of service revenues) 26.1% 24.8%
CAPEXCAPEXCAPEXCAPEX 69.369.369.369.3 93.093.093.093.0 ----25.525.525.525.5 %%%% • Progressive normalization of CAPEX after peak in Q2 last year due to 4G roll-out: 95 % outdoor coverage and 77 % indoor coverage(in % of service revenues) 12.9% 16.8%
Operating Operating Operating Operating cash flowcash flowcash flowcash flow 71.171.171.171.1 44.044.044.044.0 +61.5 %+61.5 %+61.5 %+61.5 %• EBITDA stabilization combined with CAPEX normalization improving cash flow profile
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Revenuesimpact
EBITDAimpact
1116
12
5
6
131
22
16
119
3
4
8
H1 2015
100
H2 2014
14
H1 2014
11
MTREU Roaming
EU Roaming
• Belgium : €10.0m
• Luxembourg : €2.1m
MTR
• Luxembourg : €0.7m
EU Roaming
• Belgium : €8.1m
• Luxembourg: €1.1m
MTR
• Luxembourg : €0.4m
regulatory impactthe last decrease under roaming III regulation has annualized in H1
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Mobilerevenues
-2
H1 2014c.b.
539
regulatoryimpact
-13
H1 2014actuals
552 ----2222((((----0,4%0,4%0,4%0,4%))))
H1 2015actuals
537
Fixedrevenues
-1
consolidated service revenues yearconsolidated service revenues yearconsolidated service revenues yearconsolidated service revenues year----onononon----year evolutionyear evolutionyear evolutionyear evolutionin million euros
consolidated service revenues-0.4 % underlying total service revenues growth before regulatory impact
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142
13131
140
H1 2015actuals
1
indirect costs
3
labor costs
+11+11+11+11((((8,7%8,7%8,7%8,7%))))
service revenues
direct costs*
-3
other revenues
-2
H1 2014 c.b.
regulatory impact
-10
H1 2014actuals
consolidated restated EBITDA yearconsolidated restated EBITDA yearconsolidated restated EBITDA yearconsolidated restated EBITDA year----onononon----year evolutionyear evolutionyear evolutionyear evolutionin million euros
consolidated restated EBITDAopex reduction and EBITDA stabilization in line with full year guidance
* Excluding regulatory impact, net of mobile equipment sales
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262283
----7,2%7,2%7,2%7,2%
H1 2014 H1 2015
6770
----4,6%4,6%4,6%4,6%
H1 2014 H1 2015
135135
----0,3%0,3%0,3%0,3%
H1 2014 H1 2015
• Reaping the benefits of the distribution overhaul
• Steering customer investment
• Investment in customer loyalty
• Reduction of roaming costs
Direct costs Labor costs Indirect costs
Mobistar group cost structure evolutioncost reduction reallocated to growth opportunities with net opex savings
in million euros
• Continuous net decrease of headcount
• Rebalancing between front line and back office
• Dimensioning of cable operations
• Stabilization in spite of internalization distribution
• No adjustment of the Walloon pylon tax
• Support of the cable launch project team
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total CAPEXin million euros
% of total service revenues
• 71% of total group CAPEX allocated to network
• 95% 4G outdoor coverage
• progressive normalization of investments below 13% of service revenues
----25,5%25,5%25,5%25,5%
H1 2015
6912.9%
H1 2014
9316.8%
consolidated capital expensesprogressive normalization of investments after 4G rollout peak
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in in in in €€€€mmmm H1 2015H1 2015H1 2015H1 2015 H1 2014H1 2014H1 2014H1 2014 Var. (%)Var. (%)Var. (%)Var. (%) InsightInsightInsightInsight
EBITDAEBITDAEBITDAEBITDA 140.4140.4140.4140.4 137.0137.0137.0137.0 +2.5 %+2.5 %+2.5 %+2.5 % • Lower restructuring costs (less redundancy and distribution contract termination)
• Increase of year-on-year restated EBITDA(in % of service revenues) 26.1% 24.8%
Net incomeNet incomeNet incomeNet income 25.125.125.125.1 24.224.224.224.2 +3.8 %+3.8 %+3.8 %+3.8 % • In line with EBITDA evolution
Net profit per shareNet profit per shareNet profit per shareNet profit per share 0.420.420.420.42 0.400.400.400.40 +3.8 %+3.8 %+3.8 %+3.8 %
Net Net Net Net financial financial financial financial ddddebtebtebtebt 499.8499.8499.8499.8 547.2547.2547.2547.2 ----8.7 %8.7 %8.7 %8.7 % • €47m reduction in net debt
Net financial debt /Net financial debt /Net financial debt /Net financial debt / EBITDAEBITDAEBITDAEBITDA 1.9x1.9x1.9x1.9x 2.0x2.0x2.0x2.0x• Improved cash flow profile allows initial
deleveraging
Operating cash flowOperating cash flowOperating cash flowOperating cash flow 71.171.171.171.1 44.044.044.044.0 +61.5 %+61.5 %+61.5 %+61.5 %• EBITDA stabilization combined with CAPEX decrease improving cash flow profile
Organic cash flowOrganic cash flowOrganic cash flowOrganic cash flow 37.037.037.037.0 15.315.315.315.3 +142.2 %+142.2 %+142.2 %+142.2 % • €22m organic cash flow improvement
consolidated net income and financial debtdebt refinanced and improve cash flow generation profile
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in in in in €€€€mmmm H1 2015H1 2015H1 2015H1 2015 2015 2015 2015 2015 outlookoutlookoutlookoutlook
Service revenuesService revenuesService revenuesService revenues 537.1537.1537.1537.1
year-on-year -2.7%
RestatedRestatedRestatedRestated EBITDAEBITDAEBITDAEBITDA 142.1142.1142.1142.1260260260260----280*280*280*280*
Restated EBITDA margin 26.5%
Net Net Net Net InvestmentsInvestmentsInvestmentsInvestments 69.369.369.369.3 ~190*~190*~190*~190*
Before any impact related to the cable opportunity
Mobistar group outlook2015 full year guidance reiterated
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Q&A
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3Q 2015 Roadshow Schedule
DATE LOCATION BROKER ROADSHOW / CONF.
2 Sept 20152 Sept 20152 Sept 20152 Sept 2015 London Barclays European Media & Telecom Forum
3 Sept 20153 Sept 20153 Sept 20153 Sept 2015 London Deutsche Bank TMT Conference
4 4 4 4 Sept 2015Sept 2015Sept 2015Sept 2015 Brussels Bank Degroof Management roadshow
9 9 9 9 Sept 2015Sept 2015Sept 2015Sept 2015 Paris Société Générale CIB Management roadshow
16/17 16/17 16/17 16/17 Sept 2015Sept 2015Sept 2015Sept 2015 New York Goldman Sachs Communacopia Conference
18 Sept 201518 Sept 201518 Sept 201518 Sept 2015 San Francisco Macquarie Management roadshow
22 Sept 201522 Sept 201522 Sept 201522 Sept 2015 Luxemburg KBC Management roadshow
24 Sept 201524 Sept 201524 Sept 201524 Sept 2015 Milan JP Morgan Management roadshow
30 30 30 30 Sept 2015Sept 2015Sept 2015Sept 2015 London KBC Securities Management roadshow
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