Elisa Oyj Class A · OMXHEX:ELISA
Elisa Oyj Class A — Investor Day (October 2014)
22 slides from Elisa Oyj Class A's investor day presentation, Oct 22, 2014
Slide 1: Group overview
Group overview Veli-Matti Mattila CEO
Slide 2: Content
Content 1 Performance update 2 Market environment 3 Strategy execution 4 Mid-term targets 5 CEO priorities 2 22 October 2014 Elisa CMD 2014 | Group overview
Slide 3: Revenue has grown above industry average…
Performance update Revenue has grown above industry average… Elisa European telecom operators’ average CAGR +0,3% CAGR -2,8% 2012 2H13- 1H14 3 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 4: …and EBITDA has improved
Performance update …and EBITDA has improved EBITDA, EURm 529 CAGR +2.7% 508 501 2012 2013 LTM EBITDA excluding one-offs LTM = Latest twelve months, 10/2013-9/2014 4 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 5: Sound performance in telecom services…
Performance update Sound performance in telecom services… Mobile broadband subscriptions OPEX / subscriptions 2 500 Thousands +9% Index, 2012 = 100 100 +24% 100 95 94 2 000 80 1 500 60 1 000 40 500 20 0 0 2012 2013 LTM 2012 2013 LTM Total number Mobile BB (separate subs.) of mobile BB Mobile BB (add
Slide 6: …progress with new services well underway…
Performance update …progress with new services well underway… Revenue CAGR +12% -11% +1% 2012 LTM Telecom services Devices, Interconnection, visitor roaming New services 6 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 7: …and all mid-term targets on track
Performance update …and all mid-term targets on track Parameter Target by end of 2015 Revenue growth Above industry1) average EBITDA margin Above 35% CAPEX-to-sales ≤12% Capital structure Net debt / EBITDA 1.5-2x Equity ratio >35% = Below track = On track = Achieved 1) European telecom operators 7 2
Slide 8: Favourable market environment…
Market environment Favourable market environment… Megatrends Developed create demand EU economies • Digitalisation incl. Finland mobility, video and • Number 4 in global cloud competitiveness index1) • Internet of everything • Credit ratings AAA, Aaa, AA+2 • Climate change and resource scarcity Esto
Slide 9: …is a basis for an attractive telecom market…
Market environment …is a basis for an attractive telecom market… Market shares stable despite campaigning Price decline risk lowest in EU 18 Subscription market shares1) Average price of incremental gigabyte in unlimited 16 45% 14 minute and SMS smartphone tariff plans2), EUR Elisa 40% 12 Finland Te
Slide 10: …and provide potential to further increase customer perceived value
Market environment …and provide potential to further increase customer perceived value Average download speed1) • Need for speed Mbps, mobile data growing 20 16 • Quality increasingly 12 important 8 CAGR • New services 4 25% provide additional 0 1H12 2H12 1H13 2H13 1H14 opportunities, internationall
Slide 11: Elisa has a strong position...
Strategy execution Elisa has a strong position... #1 in Finland, #2 in Estonia • Scale Industry leading in new services businesses • Share of revenues almost 15% Unique Determined to improve productivity and quality telecom operator with • Track record, further potential strong commitment to shareho
Slide 12: …and focus on three strategy execution areas
Strategy execution …and focus on three strategy execution areas Build value on data Accelerate new services businesses Improve performance with customer intimacy and operational excellence 12 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 13: Significant potential in performance improvement with solid track record
Strategy execution Significant potential in performance improvement with solid track record Process development User experience E.g. Customer contacts / user base E.g. Incidents / user base 6.6% 0.37% 5.5% 0.28% 4.9% 0.26% 2012 2013 LTM 2012 2013 LTM IT performance improvement (incl. outsourcing) On
Slide 14: Growing value of mobile data and LTE investments…
Strategy execution Growing value of mobile data and LTE investments… Expanding 4G penetration drives traffic growth …and to build this momentum Elisa has in LTE with EUR 5-10 / month premium… focused its investments on LTE. 3 500 LTE coverage LTE coverage MB, millions Dec 2013 today 3 000 2 500 2 00
Slide 15: …drive mobile service revenue transformation…
Strategy execution …drive mobile service revenue transformation… CAGR -18% CAGR +16% 2012 2013 LTM Revenue based on usage Revenue based on fixed monthly fees 15 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 16: …with upside potential from speed upgrades
Strategy execution …with upside potential from speed upgrades Mobile customers by data speed categories • Customers are willing to 60 % 3Q12 +6.8% pay more for higher 50 3Q14 speeds 40 30 3X 20 • Speed based pricing 10 enhances stickiness of 0 <21 Mbit/s 21 Mbit/s max 50 Mbit/s max 100 Mbit/s mobile
Slide 17: Portfolio of new services…
Strategy execution Portfolio of new services… Examples New services, international Visual communications EpicTV New services, domestic Viihde Cloud based IT Additional telecom services Information security Personal storage 17 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 18: … continues to create value in several dimensions
Strategy execution … continues to create value in several dimensions To customers To Elisa Experiences, e.g. • Synergy by utilisation of competencies and • thrilling experiences from videos assets of core business • entertainment on demand • Valuable learnings to improve core business Productivity,
Slide 19: Mid-term targets updated
Mid-term targets updated Parameter Target by end of 2017 Revenue growth Above industry1) average EBITDA margin Above 36% CAPEX-to-sales ≤12% Capital structure Net debt / EBITDA 1.5-2x Equity ratio >35% 1) European telecom operators 19 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 20: CEO priorities
CEO priorities Build value on data Accelerate new services businesses Improve performance with customer intimacy and operational excellence 20 22 OctoberSISÄINEN 2014 Elisa CMD 2014 | Group overview
Slide 21: Forward looking statements
Forward looking statements Statements made in this document relating to the future, including future performance and other trend projections, are forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circum
Slide 22: Thank you
Thank you