Altice Europe — Q2 2019 Earnings Presentation
23 slides from Altice Europe's earnings presentation, Jul 31, 2019
Slide 1: Altice Europe Q2 2019 Results
Altice Europe Q2 2019 Results July 31, 2019
Slide 2: Disclaimer
Disclaimer FORWARD-LOOKING STATEMENTS Certain statements in this presentation constitute forward-looking statements. These forward-looking statements include, but are not limited to, all statements other than statements of historical facts contained in this presentation, including, without limitatio
Slide 3: Altice Europe Q2 2019 Summary Review
Altice Europe Q2 2019 Summary Review Revenue growth accelerating: +3.8% YoY in Q2 2019 • France: +4.0%, with residential growing • International: +3.6% EBITDA and OpFCF growth accelerating • Adjusted EBITDA: +10%, highest EBITDA ever at SFR • OpFCF1: +18% YoY Continued operational improvement in all
Slide 4: SFR Commercial Performance
SFR Commercial Performance Consistent commercial performance driven by further operational improvements B2C fixed net adds1 B2C mobile postpaid net adds2 (‘000) (‘000) B2C fixed base 6.3m +3% YoY B2C mobile postpaid base 14.0m +6% YoY of which fibre 43% Churn +391 +52 +51 -20% +31 YoY in Q2-19 +28 +
Slide 5: Introducing The SFR Box 8
Introducing The SFR Box 8 New set-top box designed and produced by Altice Labs to be launched in France in August The SFR Box 8 is landing! Key Features Ultra-innovative 4K HDR with Dolby Vision® and Dolby Atmos®: the SFR Box 8 offers cinema-like sound and image Ultra-smart home With the integra
Slide 6: MEO Commercial Performance
MEO Commercial Performance Subscriber base growth for both fixed and mobile segments with best-in-class churn B2C fixed net adds B2C mobile postpaid net adds (‘000) (‘000) B2C fixed base 1.6m +1.4% YoY B2C mobile postpaid base 3.0m +4.6% YoY of which Fibre 55% Fibre churn 8% +8 +8 In Q2-19 +6 +4 +38
Slide 7: France Revenue Trends
Altice France Revenue Trends Residential back to growth, Business & Media growth accelerating Components of Q2 2019 revenue trends1 (€m) +4.0% YoY • Total Altice France: +4.0% YoY in Q2 2019 2,550 2,598 2,497 104 112 102 • Residential2: +0.3% 731 807 817 • Fixed: -2.7% • Mobile: +2.1% 1,029 1,012 1,
Slide 8: France Revenue Growth Accelerating
Altice France Revenue Growth Accelerating Growth supported by residential business and accelerated construction revenues from SFR FTTH Altice France revenue trend YoY1 Total residential revenue trend YoY1,2 +4.0% +0.3% -1.4% -1.2% -6.6% -6.9% -6.8% -7.3% -7.5% -9.0% Q2-18 Q3-18 Q4-18 Q1-19 Q2-19 Q2-
Slide 9: International Revenue Trends
Altice International Revenue Trends Accelerated revenue growth in Q2 2019 Components of Q2 2019 revenue trends YoY1 (€m) +3.6% YoY 1,014 • Total Altice International: +3.6% YoY in Q2 2019 978 968 83 116 88 138 141 • Portugal: +1.1% 139 241 232 235 • Israel: -2.6% (-7.7% with CC) • Dominican Republic
Slide 10: Pro Forma Financials
Altice Europe Pro Forma Financials IFRS 15 Financials1 €m Q2-18 Q2-19 Growth YoY Reported Growth YoY Constant FX France 2,497 2,598 +4.0% +4.0% Altice International 978 1,014 +3.6% +1.8% Altice TV 20 57 - - Corporate and Other, Eliminations -36 -76 - - Total Revenue 3,460 3,592 +3.8% +3.3% France 97
Slide 11: Free Cash Flow Generation
Free Cash Flow Generation Q2 2019 Free Cash Flow and net change in cash bridge1 (€m) 1,434 678 (756) 51 77 (394) (156) (77) (1,262) (204) (1,338) Adjusted Accrued Operating Cash Cash Other Free Cash Other Gross debt Financing Net change EBITDA Capex Free Cash Interest Taxes operating Flow investing
Slide 12: FY 2019 Guidance Increased and Mid-Term Outlook Reiterated
FY 2019 Guidance Increased and Mid-Term Outlook Reiterated FY 2019 Guidance Reported results Prior New Q1-19 Q2-19 Altice France 3-5% 5-6% -1.6% +4.0% Revenue Growth YoY Altice France €4.0-4.1bn €4.1-4.2bn €0.96bn €1.08bn Adjusted EBITDA Altice Europe (ex Altice TV) In the 10% area In the 15% area +
Slide 13: Focus on Altice Luxembourg Target Leverage
Focus on Altice Luxembourg Target Leverage Multiple de-leveraging levers LTM Net Debt to Adjusted EBITDA 5.2x1 4.25x Q2 2019 EBITDA growth FCF generation Asset disposal proceeds Target leverage 1. Pro forma for €56m of cash released from the SFR FTTH escrow account in July 2019. Excludes operating l
Slide 14: Hidden Value
Altice Europe Hidden Value A full set of strategic fixed and mobile infrastructure assets in all geographies and high value stakes 100% 100% FTTB Network (10m HP) FTTH Network (3.8m HP1) Fully modernized FTTB network delivering up to 1Gb/s Leading network operator in Portugal and on track for nation
Slide 15: Debt Maturity Profile
Altice Europe Debt Maturity Profile1 Long-dated maturities Altice maturity profile (€bn) 0.1 0.3 1.6 1.1 2.7 1.8 5.3 12.2 5.0 0.7 WAL of 6.0 years WACD of 5.7% €3.3 billion available liquidity1 86% fixed interest debt 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 Altice Europe Restricted Groups
Slide 16: Q&A
Q&A 16 alti
Slide 17: Appendix
Appendix 17 alti
Slide 18: Detailed Pro Forma Financials
Altice Europe Detailed Pro Forma Financials IFRS 15 Financials1 €m Q2-18 Q2-19 Growth YoY Reported Growth YoY Constant FX France 2,497 2,598 +4.0% +4.0% Portugal 516 522 +1.1% +1.1% Israel 241 235 -2.6% -7.7% Dominican Republic 138 141 +1.9% -1.6% Teads2 83 116 +39.8% +34.0% Altice TV 20 57 - - Corp
Slide 19: Pro Forma Debt Capital Structure
Altice Europe Pro Forma Debt Capital Structure1 Altice Europe N.V Gross Debt €31,189m Net Debt €30,084m Gross Leverage 5.9x Net Leverage 5.7x Altice Luxembourg consolidated 3.74%4 Gross Debt €29,461m Altice Corporate Net Debt €28,540m Altice USA Inc. Financing S.à r.l. (ACF) Gross Leverage 5.4x Gros
Slide 20: Reconciliation of non-GAAP performance measures to operating profit
Altice Europe N.V. Reconciliation of non-GAAP performance measures to operating profit1 For the three months ended €m June 30, 2019 Revenue 7,104.3 Purchasing and subcontracting costs -1,878.0 Other operating expenses -1,320.5 Staff costs and employee benefits -754.8 Total 3,150.9 Share-based expens
Slide 21: Pro forma net leverage reconciliation as of June 30, 2019
Altice Europe N.V. Pro forma net leverage reconciliation as of June 30, 2019 €m Altice Europe N.V Reconciliation to Swap Adjusted Debt Actual Pro Forma Total Debenture and Loans from Financial Institutions 31,515 31,515 Value of Debenture and Loans from Financial Institutions in Foreign Currency con
Slide 22: Pro forma net leverage reconciliation as of June 30, 2019
Altice Europe N.V. Pro forma net leverage reconciliation as of June 30, 2019 €m Altice Luxembourg Consolidated Altice Altice Europe Altice Altice Altice Lux Altice TV ACF Europe N.V Altice Europe N.V (Pro Forma) Altice France Eliminations N.V International Luxembourg Conso Consolidated Gross Debt Co
Slide 23: IFRS 16: Impact on KPIs
Altice Europe N.V. IFRS 16: Impact on KPIs KPI IFRS 16 impact Comments Adjusted EBITDA Income (after operating leases and No Statement impact • Unchanged Adjusted EBITDA definition before financial leases) Cash Flow No • Unchanged Capex definition Adjusted EBITDA - Capex Statement impact • Unchanged