Magyar Telekom Telecommunications Plc · BET:MTELEKOM
Magyar Telekom Telecommunications — Magyar Telekom — Q2 2017 Earnings Presentation
27 slides from Magyar Telekom Telecommunications's earnings presentation, September 2017
Slide 1: Magyar Telekom Group Investor Presentation
MAGYAR TELEKOM GROUP INVESTOR PRESENTATION SEPTEMBER, 2017
Slide 2: Strategy and Market Position
STRATEGY AND MARKET POSITION
Slide 3: Overview – Magyar Telekom at a Glance
OVERVIEW – MAGYAR TELEKOM AT A GLANCE Overview International presence Revenue (FY2016) Integrated operations in Hungary and Macedonia* 8.9% leading telecommunications service provider in both 4.8% countries 86.4% leading SI/IT service provider in Hungary EBITDA (FY2016) Majority owned by Deu
Slide 4: Market Positions in the Hungarian Telco Market
MARKET POSITIONS IN THE HUNGARIAN TELCO MARKET Total mobile market* Fixed voice market** Vodafone Other Subscribers -0.5% Subscribers Telenor +0.9% Invitel 12,000,000 3,500,000 MT DIGI 24.1% 24.7% 24.9% 3,000,000 3.9% 3.1% 3.3% UPC 9,000,000 12.9% 13.2% 12.4% 2,500,000 11.4% 12.2% MT 10.6% 28.1% 28.
Slide 5: IT Market in Hungary
IT MARKET IN HUNGARY Total IT market (HW&SW and IT services)* IT Services market shares (by revenue)* HUF bn SYSTEM INTEGRATION IT INFRASTRUCTURE SI&IT 800 +4.0% 742 Package Custom System IT App. OS & Infra. OS & Infra. proj. Hosting Cloud 721 appl. app. dev. integration consulting operation operati
Slide 6: Strategy Overview: Building a Growing ICT Company Serving Satisfied Customers
STRATEGY OVERVIEW: WITH OUR ENGAGED PEOPLE, WE ARE BUILDING A GROWING ICT COMPANY SERVING SATISFIED CUSTOMERS Strategic pillars Strategic goals 1 Together. Increase customer satisfaction For We listen: customer and colleague opinions form an Improve customer service level our important part of our d
Slide 7: Hungarian Economic Environment
HUNGARIAN ECONOMIC ENVIRONMENT Growth structure Domestic demand 6% Domestic demand improved as economy 3.7% 3.6% 3.7% recovered 4% 3.4% Governmental measures support consumer 2.0% 2% 1.5% spending Investment levels show volatility due to EU 0% fund cycles MT leveraged positive trends of dome
Slide 8: Network Developments in Hungary
NETWORK DEVELOPMENTS IN HUNGARY Mobile network coverage (population based) Fixed network (Households covered) % HHs ths 97% 98% 99% 4,000 100 93% 83% 83% 86% 78% 80 3,000 33% 38% 43% 4% 60 2,000 36% 28% 40 84% 76% 87% 82% 89% 40% 71% 65% 71% 43% 1,000 34% 22% 20 7% 2% 25% 17% 15% 12% 0 0 2014 2015 2
Slide 9: Hungarian Mobile Spectrum Allocation
HUNGARIAN MOBILE SPECTRUM ALLOCATION Current spectrum allocation (MHz) BAND Magyar Telekom Telenor 700 MHz 2x5 2x5 2x5 2x5 2x5 2x5 Vodafone Digi Free 800 MHz 2x10 2x10 2x10 900 MHz 2x11.8 2x11 2x12 1800 MHz 2x15 2x5 2x25 2x30 2100 MHz 2x15 2x15 2x15 2x5 2x5 2x5 2600 MHz 2x30 2x20 + 1x25 2x20 3.4 - 3
Slide 10: H1 2017 Results, Guidance and Dividend
H1 2017 RESULTS, GUIDANCE AND DIVIDEND
Slide 11: H1 2017 Financial Results and 2017 Targets
H1 2017 FINANCIAL RESULTS AND 2017 TARGETS* FY 2016 H1 2017 2017 RESULTS RESULTS TARGETS Strong growth in Hungarian SI/IT driven by uptick in EU fund inflows Mobile service revenue growth continues around REVENUE HUF 574.0 bn HUF 294.0 bn Equipment sales used to establish customer relationship
Slide 12: Dividend Policy
DIVIDEND POLICY Dividend payment and net debt ratio developments Highlights Net debt ratio* Dividend per share (HUF) 50% 70 Aiming to maintain net debt ratio (net 45.7% debt/total capital) target of 30% - 40% 43.8% 42.9% 39.1% 60 HUF 25 dividend per share payment 40% 34.1% 34.3% based on 2016 re
Slide 13: Q2 Results
Q2 RESULTS
Slide 14: Q2 2017 Strategic Highlights
Q2 2017 STRATEGIC HIGHLIGHTS NEW MOBILE Over 300,000 subscribers PORTFOLIO Increased data subscription resulting in elevated ARPU levels PREPAID Successful registration process closed on June 30, 2017 REGISTRATION Over 95% of prepaid revenues secured HSI network rollout continues, now reac
Slide 15: Hungary
HUNGARY Revenue* EBITDA HUF bn HUF bn -4.2% +10.2% 44.9 -1.4 145 45.0 11.0 -0.1 140.8 44.5 140 44.0 -1.0 135 43.5 0.5 43.1 2.3 -1.2 43.0 -0.3 0.5 0.2 130 127.7 -1.4 2.0 42.5 42.0 125 0.5 0 0.0 2Q Mobile Mobile Mobile Fixed Fixed TV Fixed SI/IT Energy 2Q 2Q 2016 Gross profit Employee Other op. 2Q 201
Slide 16: Hungary – Mobile
HUNGARY – MOBILE Mobile SIMs Mobile ARPU ‘000 HUF -2.4% +0.9% 6,000 5,476 5,390 3,315 5,344 Prepaid Blended +1.5% 5,000 3,365 Postpaid 44.2% 41.8% 38.3% 4,000 1,132 Prepaid -2.2% 3,000 1,107 2,000 4,898 55.8% 58.2% 61.7% Postpaid -1.7% 4,815 1,000 0 Jun 2015 Jun 2016 Jun 2017 2Q 2016 2Q 2017 New pos
Slide 17: Hungary – Mobile Broadband
HUNGARY – MOBILE BROADBAND Mobile broadband user developments Smartphone penetration ‘000 % +13.9% 75 65 3,000 +7.3% 60 2,760 Non-4G 60 53 2,500 2,423 2,258 4G 39% 45 2,000 52% 1,500 70% 30 1,000 61% 15 500 48% 30% 0 0 Jun 2015 Jun 2016 Jun 2017 Jun 2015 Jun 2016 Jun 2017 Mobile broadband usage deve
Slide 18: Hungary – Fixed Voice, Broadband and TV
HUNGARY – FIXED VOICE, BROADBAND AND TV Fixed BB customer number Pay TV customer number ‘000 ‘000 +3.7% +4.1% +3.6% 1,200 1,200 +3.2% 1,009 1,050 DSL 1,006 Sat TV 972 1,000 941 971 1,000 Cable Cable TV Fiber 31% 28% IPTV 800 53% 800 32% 60% 57% 600 13% 600 15% 18% 400 400 35% 59% 34% 34% 54% 200 200
Slide 19: Hungary – Multiplay
HUNGARY – MULTIPLAY Fixed line multiplay residential subs. development Fixed line multiplay residential ARPU development ‘000 HUF Annual churn 1,500 1,421 1,391 5,818 1,368 1Play Blended +3.6% 12% 6,030 37% 33% 30% 2Play 3Play 3,044 1,000 1Play +4.6% 15% 3,185 30% 28% 30% 5,757 500 2Play +1.0% 11% 5
Slide 20: Hungary – SI/IT
HUNGARY – SI/IT SI/IT revenue developments SI/IT revenue breakdown by vertical segments* HUF bn Market Share* 100 Finance 13% Hardware & Software Manufacturing 6% 80 w/o mobile devices IT Infrastructure Retail&WS 6% 50% services Prof. Services 11% 60 39% System Integration / Telco+Media 10% 43% 40 I
Slide 21: Macedonia
MACEDONIA Financials Mobile market Revenues (HUF bn) EBITDA (HUF bn) Subscribers One (T. Slovenia)* 14.0 5.5 +31.3% 2,500,000 -0.3% +2.4% VIP (T. Austria) -4.3% One.Vip 0.2 5.0 1.1 4.8 2,000,000 13.5 13.3 25.0% Telekom 4.5 51.5% 51.4% -0.3 1,500,000 13.0 4.0 28.4% 12.8 3.7 0.0 1,000,000 -0.5 3.5 12.
Slide 22: Appendix
APPENDIX
Slide 23: Q2 2017 Group Segmental Revenue and EBITDA
Q2 2017 GROUP SEGMENTAL REVENUE AND EBITDA Group segmental revenues Group segmental EBITDA HUF bn +8.9% HUF bn -1.8% 156 0.2 -0.3 49.0 48.7 10.9 -0.5 153.5 154 152 48.5 150 1.1 48.0 47.9 148 0.0 -0.1 146 47.5 3.0 -0.8 144 -1.4 142 141.0 47.0 0.0 140 -0.5 0 0.0 2Q 2016 Mobile Fix SI/IT & Mobile Fix S
Slide 24: Magyar Telekom – Consolidated Income Statement
MAGYAR TELEKOM – CONSOLIDATED INCOME STATEMENT HUF million Q2 2016 Q2 2017 Change Mobile revenues 76,454 79,617 4.1% Fixed line revenues 49,191 48,159 -2.1% System Integration/Information Technology revenues 13,852 24,398 76.1% Revenue from energy services 1,490 1,347 -9.6% Revenues 140,987 153,521
Slide 25: Magyar Telekom – Consolidated Balance Sheet
MAGYAR TELEKOM – CONSOLIDATED BALANCE SHEET HUF million Dec 31, 2016 Jun 30, 2017 Change Current assets 193,978 188,050 -3.1% Cash and cash equivalents 10,805 7,789 -27.9% Other current financial assets 5,104 4,392 -13.9% Non current assets 981,551 925,067 -5.8% Property, plant and equipment - net 4
Slide 26: Magyar Telekom – Consolidated Cash Flow Statement
MAGYAR TELEKOM – CONSOLIDATED CASH FLOW STATEMENT HUF million Jun 30, 2016 Jun 30, 2017 Change Net cash generated from operating activities 61,225 62,109 1.4% Investments in tangible and intangible assets (33,587) (37,686) -12.2% Adjustments to cash purchases (14,120) (6,219) 56.0% Purchase of subsi
Slide 27: For further questions please contact the IR department
For further questions please contact the IR department: Linda László Rita Walfisch Head of Investor Relations Investor Relations Manager Phone: +36 1 481-7676 Phone: +36 1 457-6084 e-mail: laszlo.linda@telekom.hu e-mail: walfisch.rita@telekom.hu DISCLAIMER This investor presentation contains forward