FY3/2012 FY3/ FY3/2015 FY3/2015

Transcription

1 Draft Medium Term Business Strategy FY3/ FY3/2015 February 2012

2 Medium Term Business Target Growth Strategy 2015 Investment Summary 2

3 Medium Term Business Target 3

4 Previous 3-Year Financials Review Achievements Revenue increased by 65% to over 200 billion yen Transformation to positive recurring profit Reducing revenue and EBITDA dependence on fixed business Revenue FY3/2009 (pro-forma) billion yen FY3/2012 (estimates) billion yen Mobile (% share) 61.4 billion yen (50%) billion yen (79%) Fixed (% share) 61.5 billion yen (50%) 42.0 billion yen(21%) EBITDA Mobile (% share) Fixed (% share) 2.2 billion yen billion yen 20.6 billion yen 63.0 billion yen 44.0 billion yen (70%) 19.0 billion yen (30%) Recurring profit billion yen 12.5 billion yen 4

5 Revenue Growth Comparison 3-Year) Highest 3-Year revenue growth of 65.2% during FY3/2009 to FY3/2012E Highest 3-Year revenue CAGR of 18.2% during FY3/2009 to FY3/2012E Absolute 3-Year Revenue Growth FY3/ FY3/2012E 3-Year Revenue CAGR FY3/2009-FY3/2012E eaccess 65.2% eaccess 18.2% Company A 20.6% Company A 6.4% Average 4.4% Average 1.5% Company B 1.5% Company B 0.4% -4.7% Company C -1.6% Company C -10% 0% 10% 20% 30% 40% 50% 60% 70% -5% 0% 5% 10% 15% 20% 25% Source: public information 5

6 EBITDA Growth Comparison (3-Year) EBITDA 3-Year growth increased over 28X during FY3/2009 to FY3/2012E EBITDA 3-Year CAGR also increased over 200% during FY3/2009 to FY3/2012E Absolute 3-Year EBITDA Growth FY3/2009-FY3/2012E 3-Year EBITDA CAGR FY3/2009-FY3/2012E eaccess 28.6X % eaccess 205.9% Company A 48.0% Company A 14.0% Average 9.4% Average 3.1% Company B 2.1% Company B 0.7% -5.8% Company C -2.0% Company C -500% 0% 500% 1000% 1500% 2000% 2500% 3000% -40% 10% 60% 110% 160% 210% Source: public information 6

7 Medium Term Business Target (3-Year) Growth Focus Increase revenue to billion yen from billion yen (up 72%) EBITDA growth to be driven by mobile business Recurring profit to 3x to 40.0 yen billion from 12.5 billion yen FY3/2012 (estimates) FY3/2015 (estimates) Revenue billion yen billion yen Mobile (% share) billion yen (79%) Fixed (% share) 42.0 billion yen (21%) billion yen (93%) 25.0 billion yen (7%) EBITDA Mobile (% share) Fixed (% share) 63.0 billion yen 44.0 billion yen (70%) 19.0 billion yen (30%) 90.0 billion yen 80.0 billion yen (89%) 10.0 billion yen (11%) Recurring profit 12.5 billion yen billion yen 7

8 Subscriber Acquisition Target FY3/2009 FY3/2012E FY3/2015E Mobile 1.4 million 4.0 million 6.6 million Net Addition: +2.6 million Fixed 2.6 million 1.6 million 0.9 million Total 4.0 million 5.6 million 7.5 million 8

9 Capital Spending Plan FY3/2010 ~ FY3/2012E FY3/2013E ~ FY3/2015E Accumulated 3-Year capex plan billion yen billion yen * Capex focus Complete area expansion to 93% population coverage Complete underground & subway station coverage Network speed upgrade to 42Mbps (DC-HSPA) Network upgrade to LTE to 75Mbps & 112Mbps Backhaul upgrade to 100% all IP 100% underground d subway tunnel investment Area coverage to expand to over 95% population coverage *C Current capex figures do not ti include platinum band & migration capex * Capex figures to be revised after platinum band allocation 9

10 Pro-forma Summary Expect revenue to increase 72% to billion yen from billion yen Operating profit to increase 2x to 50.0 billion yen from 25.0 billion yen Recurring profit to increase 3x to 40.0 billion yen from 12.5 billion yen Unit: million users billion yen FY3/2009 (pro-forma) FY3/2010 (pro-forma) FY3/2011 (pro-forma) FY3/2012E FY3/2015E Subscribers Mobile (% share) Fixed (% share) 1.4 (35%) 2.6 (65%) 2.4 (51%) 2.3 (49%) (62%) 1.9 (38%) 4.0 (71%) 1.6 (29%) 6.6 (88%) 0.9 (12%) Revenue Mobile (% share) Fixed (% share) 61.4 (50%) 61.5 (50%) (64%) 62.9 (36%) (71%) 56.5 (29%) (79%) 42.0 (21%) (93%) 25.0 (7%) EBITDA Mobile (% share) (41%) 40.3 (62%) 44.0 (70%) 80.0 (89%) Fixed (% share) (59%) (38%) 19.0 (30%) (11%) Operating Profit Recurring profit

11 Growth Strategy

12 Growth Strategy Subscribers/Revenue Growth Strategy 2015 Step 3 Main Stream Carrier Step 2 Smart phone Strategy 2015~ Area coverage 99% Challenge mobile mainstream market Step 1 Strengthen Mobile Broadband Position 2012~2013 LTE Retention Branding 2013~2015 Shops Handset Marketing 2012~ ~ ~ 12

13 Addressing Existing Challenges Network ARPU dilution Churn Capacity issues due to increasing traffic. Speed competition Price competition & increase in MVNO subscribers Rising churn 13

14 Strengthen Mobile Broadband Position LTE Retention Marketing 14

15 LTE Strategy 1 st flat rate 1 st HSUPA 7.2 Mbps 1 st HSPA+ 21 Mbps 1 st DC- HSPA 42 Mbps LTE 75 Mbps 112 Mbps Mobile broadband 3.6 Mbps network leader HSPA HSUPA HSPA+ DC-HSPA LTE 2009/ /1 2011/3 2012/3 15

16 LTE Area Coverage Plan Speed Plan to launch LTE in March 2012 Expand area coverage to 70% by March /112Mbps 42Mbps ~21Mbps LTE HSPA+/DC-HSDPAHSDPA 70% 14Mbps HSPA 93% 100% IP Backbone EMOBILE G4 area is compliant area to downlink speed Max 42Mbps. (Some areas:max 21Mbps or Max 14.4Mbps ** Nation-wide around 70%, Metropolis and government-decreed city: around 99%, Underground: 100% (end of 2012) 16

17 Mobile Broadband Market Growth Mobile Broadband Users 15.0 million 8.0 million 4.0 million 6.6 million Target Customers 1) Speed upgrade Migrate low/medium speed MBB users to high speed users (7.2/42Mbps 75Mbps) 2) New customers Attract new MBB customers from new entry users, fixed broadband & FMC FY3/2012 FY3/

18 ARPU and Churn Improvement Target to reduce monthly churn to below 1.5% levelel Target to recover ARPU back to around 3,000 yen level Churn improvement target ARPU recovery target (ARPU: yen) 4, % 1.29% 1.40% % 1.50% 1.44% 1.54% below 1.5% around 3,000 yen 3,500 3,400 3,250 3,100 3,000 2,950 2,860 2,730 2,730 2,500 2,000 1,500 1Q FY3/11 2Q FY3/11 3Q FY3/11 4Q FY3/11 1Q FY3/12 2Q FY3/12 3Q FY3/12 FY3/15 1,000 1Q FY3/11 2Q FY3/11 3Q FY3/11 4Q FY3/11 1Q FY3/12 2Q FY3/12 3Q FY3/12 FY3/15 18

19 Churn Analysis and Retention Plan Reduce churn (below 1.5%) with initiatives targeting three main causes (speed, coverage and price) (%) % Natural churn 1.0% Others Tariffs Rt Retention ti Plan 4,980 yen (7.2Mbps) 3,880 yen (42Mbps) Churn to Area 93% 95% other carriers Speed 7.2Mbps 42Mbps/ LTE EM churn Churn reasons to other carriers improve indoor tunnel coverage Source: EMOBILE former user survey (n = 400 people who churned in the last 18months) 19

20 Smart phone Re-entry Strategy 20

21 Smart phone Market Growth Expect smart phone market to reach over 50% penetration in Japan s mobile market (million % % 80 40% 60 30% 40 20% 20 10% 0 FY3/2009 FY3/2010 FY3/2011 FY3/2012 FY3/2013 FY3/2014 FY3/2015 FY3/2016 Smartphone user Featurephone user Smartphone user ratio 0% Source: MM Souken 21

22 Smart phone Re-entry entry Strategy Shops Plan to expand EMOBILE shops Handset Preparation of LTE smartphone Marketing Strengthen branding and marketing Focus and target specific customer segments to expand smartphone subscriber base 22

23 Marketing and Sales Channels Strategy FY3/2009 ~ FY3/2013E ~ FY3/2012E FY3/2015E Marketing nationwide and channels investment focus Complete coverage of major electronics retailers nationwide Product awareness marketing of Pocket Wifi Small investment in corporate brand Investment in EMOBILE carrier shops & multi- carrier shops Marketing investment in preparation for LTE Strengthen branding & product marketing 23

24 Shop Strategy Primarily Increase multi-carrier i shops EMOBILE shops 800 stores Multi-carrier shops EMOBILE shops End of FY2011 End of FY2012 End of FY2013 End of FY

25 Franchise Shop and EMOBILE Shop Images Merits of franchise shops Leverage partner s knowhow of store operation Low initial cost for store development Low running cost 25

26 Investing in Marketing and Branding Marketing Strategy Increase company s brand recognition Strengthen product brand position as No. 1 Wi-Fi Marketing preparation for LTE & smart phone launch 26

27 Investment Summary 27

28 Investment Summary Strong commitment to Medium Term Business Target Target to achieve 6.66 million mobile subscribers in 2015 Aim to increase operating profit 2x and recurring profit 3x Strengthen mobile broadband position & marketing Enter smart phone market with target customer segments 28

29 This presentation has been prepared by eaccess Ltd. ( the Company ) ). This presentation contains forward-looking statements, which are subject to risks, uncertainties, and assumptions. This presentation is being presented solely for your information and is subject to change without notice. No representation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy, actuality, fairness, or completeness of the information presented. The Company accept no liability whatsoever for any losses arising from any information contained in the presentation. This presentation does not constitute an offer or invitation to purchase or subscribe for any shares of the Company, and no part of this presentation shall form the basis of or be relied upon in connection with any contract or commitment. t 29