MAGYAR TELEKOM GROUP Q RESULTS PRESENTATION MAY 8, 2018

Transcription

1 MAGYAR TELEKOM GROUP Q1 218 RESULTS PRESENTATION MAY 8, 218

2 Q1 218 GROUP SEGMENTAL REVENUE AND EBITDA Group segmental revenues* Group segmental EBITDA* % % Q 217 Mobile Fixed SI/IT Energy Mobile Fixed SI/IT 1Q 218 1Q 217 Gross profit Indirect costs Gross profit Indirect costs Measurement diff. 1Q 218 Hungary Macedonia Hungary Macedonia Change Y-o-Y +6.8% +2.6% Change Y-o-Y +1.6% +11.% *Excluding Crnogorski Telekom financials and IFRS 9&15 impacts 2

3 Q1 218 STRATEGIC HIGHLIGHTS MOBILE FIXED SI/IT MACEDONIA Almost 1 million subscribers signed up to new postpaid tariff plans (launched in March 217) Strong growth in data continued, boosted by hard cut limits and increased customer uptake of more expensive packages Strong equipment sales due to more expensive handsets in the sales mix Revenue growth in broadband due to increased subscriber numbers and a growing number of fiber connections becoming eligible for higher bandwidth Continued dynamic growth in TV customer base and ARPU thanks expansion in the IPTV customer base Significant public sector asset sales License deliveries in Health Care sector Strong momentum in high revenue software and hardware sales projects continued Intense competition in fixed line has put pressure on revenuess but this was offset by growth in mobile and SI/IT revenue segments EBITDA reflects strong gross profit and effective cost saving measures 3

4 218 FINANCIAL TARGETS AND Q1 218 RESULTS Q1 218 RESULTS (change y-o-y) 218 TARGETS REVENUE Strong growth in SI/IT Improving service revenues trends HUF 15.6 bn (+7.2%) around HUF 6 bn EBITDA Increased gross profit Continued focus on cost optimization HUF 42.6 bn (+11.%) around HUF 19 bn CAPEX Increased spend on fixed customer connections offset by lower mobile 4 G network development spends HUF 14.5 bn (-6.5%) around HUF 9 bn FCF Reduction due to unfavourable seasonality in working capital, including higher payments to handset supplier HUF -9.9 bn (HUF -1.2 bn) around HUF 6 bn 4

5 HUNGARY Revenue* EBITDA* % % Q 217 Mobile Mobile Mobile service equipment other Fixed Fixed Fixed service equipment other SI/IT Energy 1Q 218 1Q 217 Gross profit Employee related expenses Utility tax Other op. expenses (net) 1Q 218 Mobile service revenue increase primarily driven by growth in mobile data usage and subscriber acquisition Fixed service revenue up thanks to higher TV and broadband subscriber bases Increase in SI/IT revenue driven by strong demand for HW&SW delivery projects Gross profit increase due to higher revenues and one-off decline in bad debt Increase in employee related expenses reflects insourcing of trainees Utility tax reduction driven by network upgrades Savings in energy costs and HR-related expenses *Excluding IFRS 9 &15 effects 5

6 HUNGARY MOBILE Mobile SIMs Mobile ARPU* HUF -1.3% -.1% 6, 5,372 5,34 5,298 5, Prepaid Blended 42.3% 39.9% 35.2% Postpaid 4, 3, Prepaid 1, % 3,289 3, % 1Q 217 1Q 218 2, 1, 57.7% 6.1% 64.8% Postpaid 4,817 4, % Mar 216 Mar 217 Mar 218 Total mobile data subscriber development Mobile broadband usage developments 3, 2,5 2, 1,5 1, 5 2,366 56% 44% Mar % 2,635 42% 58% Mar % 2,87 3% 7% Mar 218 Non-4G 4G GB/month 73.3% 6,, 5,, 36.9% 5,21,582 12% 1% 4,, 3,2,63 3,, 2,192,196 21% 1% 2,, 34% 3% 87% 1,, 63% 77% 1Q 216 1Q 217 1Q 218 Average data usage in Q1 218 GB/month G 3G 4G *Excluding IFRS15 effects 6

7 HUNGARY FIXED VOICE, BROADBAND AND TV Fixed line customer number development Fixed line multiplay residential subs. development 1,5 1, 5 1,448 1,1 1,424 1, ,42 1,89 1,39 Voice Broadbad PayTV 1,4 1,2 1, ,395 34% 3% 36% 1,37 31% 29% 41% 1,374 28% 28% 44% 1Play 2Play 3Play Mar 216 Mar 217 Mar 218 Mar 216 Mar 217 Mar 218 Fixed Voice, BB and TV ARPU* developments Fixed line multiplay residential ARPU* developments HUF Fixed voice Fixed BB 2,455 2, % 3,484 3, % 1Q 217 1Q 218 HUF Blended 1Play 2Play 3,98 3,111 5,889 6,48 +.4% 5,749 5, % -1.6% Annual churn 11% 15% 11% Pay TV 3,512 3, % 3Play 8,21 8,18 -.3% 8% *Excluding IFRS15 effects 1Q 217 1Q 218 7

8 HUNGARY SI/IT SI/IT revenue developments SI/IT revenue breakdown by vertical segments* % 28% 22% % 35% 27% % 3% 25% 217 Hardware & Software w/o mobile devices IT Infrastructure services System Integration / IT Application services Finance Manufacturing Retail&WS Prof. Services Telco+Media Utilities Transport Government Education Healthcare Market Share* 11% 7% 7% 14% 8% 18% 24% 24% 3% 35% SI/IT revenue and gross profit of MT-Hungary Highlights 4, 3, 2, 1, +4.1% +21.3% 2,543 16,938 6,364 6,628 1Q 217 1Q 218 Revenue Gross profit Positive trajectory of SI/IT revenues maintained EU funded projects are hardware and software focused and relatively low margin Infrastructure delivery projects serve as a starting point to developing long term customer relationships and as a foundation for IT service contracts Revenue increase driven mainly by public sector infrastructure delivery projects Gross margin 38% 29% *Based on IDC Research 217, market shares based on revenues 8

9 MACEDONIA Financials* Mobile market Revenues (MKD mn) 2,6 71 2,55 2,5 2,475 2, % ,514 EBITDA (MKD mn) 1,1 1,5 1, % ,45 Subscribers 2,5, 2,, 1,5, 1,, 5, 52.1% 47.9% +1.8% 1.1% 49.5% 49.4% -2.2% 2.6% 48.8% 48.6% Lycamobile One.Vip Telekom 1Q 217 Mobile Fixed SI/IT 1Q 218 1Q 217 Gross profit Other expenses (net) 1Q 218 Mar 216 Mar 217 Mar 218 KPIs (mobile/fixed voice/fixed BB/TV)* Highlights customer number QoQ change -5% -2% +2% +8% ARPU (MKD) % -5.6% Q 217 1Q % +3.9% Increase in mobile data and fixed TV customer base mitigates revenue pressure from competition driven tariff erosions Continued strong focus on 3 Play and FMC offers on the market Lycamobile, an ethnic MVNO using VIP s network, stabilized its market share at around 3% EBITDA improvement attributable to savings in marketing, HRrelated material and consultancy costs *Excluding IFRS 9 and 15 impacts 9

10 For further questions please contact the IR department: Péter Bauer Head of Investor Relations Phone: bauer.peter@telekom.hu Rita Walfisch Investor Relations Manager Phone: walfisch.rita@telekom.hu DISCLAIMER This investor presentation contains forward-looking statements. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore should not have undue reliance placed upon them. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events. Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Such factors are described in, among other things, our Annual Reports for the year ended December 31, 217 available on our website at Abbreviations: 3G: third generation, 4G: fourth generation, ARPU: average revenue per user, BB: broadband, IP: internet protocol, IT: information technology, LTE: long term evolution, MOU: minutes of use, MTR: mobile termination rate, NRA: National Regulatory Authority, POD: points of delivery, R/E: real estate, RPC: revenue producing customer, SAC: subscriber acquisition cost, SRC: subscriber retention cost, SI: system integration, SIM: subscriber identity module, SMB: small and medium businesses, TWM: Total Workforce Management, VAS: value added services, WS: wholesale In addition to figures prepared in accordance with IFRS, Magyar Telekom also presents non-gaap financial performance measures, including, among others, EBITDA, EBITDA margin, and net debt. These non-gaap measures should be considered in addition to, but not as a substitute for, the information prepared in accordance with IFRS. Non-GAAP financial performance measures are not subject to IFRS or any other generally accepted accounting principles. Other companies may define these terms in different ways. For further information relevant to the interpretation of these terms, please refer to the chapter Reconciliation of pro forma figures, which is posted on Magyar Telekom s Investor Relations webpage at