Hutchison Telecommunications (Australia) Ltd
Hutchison Telecommunications (Australia) — H1 2005 Earnings Presentation
14 slides from Hutchison Telecommunications (Australia)'s earnings presentation, Aug 16, 2005
Slide 1: Hutchison Telecommunications (Australia) Limited 2005 Half Year Results
Hutchison Telecommunications (Australia) Limited 2005 Half Year Results For the period ended 30 June 2005 Kevin Russell Chief Executive Officer 16 August 2005
Slide 2: A Different Market
A Different Market • 2G market becoming saturated Ø Customer quality, not quantity • Voice and SMS It’s commoditising about Ø Margins, not just ARPU • Fixed line traffic migrating Ø Increasing contribution from non-voice services • Competition increasing Ø 3G investment required • 3G networks launch
Slide 3: Highlights
Highlights • 73% increase in service revenue to $364.4 million • 23% improvement in per customer margin to $48 • 43% reduction in EBITDA losses to $122.6 million • 160% increase in service revenue to $218.1 million • Non-voice ARPU grew strongly to $16 • 27% improvement in per customer margin to $56
Slide 4: Financial Highlights
Financial Highlights Half Year Half Year Change ($million) 30 Jun 05 30 Jun 04 Service Revenue 364.4 211.1 73% Equipment Revenue 80.2 119.3 -33% Revenue(1) 444.6 330.1 35% EBITDA(2) -122.6 -214.0 43% NPAT(3) -305.3 -332.9 8% Cash CAPEX 147.9 111.6 33% (1) Revenue excludes interest income and other i
Slide 5: Customer Base
Customer Base (Customers `000) 950 950 839 839 92 73 532 610 610 858 413 15 766 224 595 426 418 386 1H04 2H04 1H05 1H04 2H04 1H05 Orange 3 Post-paid Pre-paid 56% growth in 12 months 5
Slide 6: Net Customer Growth
Net Customer Growth Half Year Half Year Half Year Net (Customers `000) 30 Jun 05 31 Dec 04 30 Jun 04 Change 3 post-paid 117 124 137 -7 3 pre-paid 2 65 - -63 Orange post-paid -25 47 61 -72 Orange pre-paid 17 -7 - 24 Total net customer growth 111 229 198 -118 Growth focus on 3 post-paid 6
Slide 7: Scope for Growth
Scope for Growth • Improved handset range and functionality • Increased awareness of network quality and coverage – supported by new Telstra roaming agreement • Launch of new coverage areas – Canberra – Campbelltown • Increased consumer appetite and awareness of 3’s non-voice services Customer growt
Slide 8: ARPU and Margin
ARPU and Margin $70 $69 $62 $48 $45 $39 1H04 2H04 1H05 1H04 2H04 1H05 Margins strengthening with increased contribution from non-voice revenue 8
Slide 9: 3 ARPU and Margin
3 ARPU and Margin $91 $94 $13 $84 $12 $16 $81 $79 $58 $68 $56 $44 1H04 2H04 1H05 ARPU Voicevoice ARPU but ARPU lower non-voice margin relatively Margin stable 9
Slide 10: Continued Growth in Content
Continued Growth in Content • Non-voice ARPU continues to strengthen • Non-SMS services growing sharply • Over 65% of base actively using content services • Over 50% of base generating billable content events • 420,000 content subscription services sold Non-SMS $16 Snow report SMS $13 $12 $7 $4 $5 $
Slide 11: Operating Expenditure
Operating Expenditure $392 $million $47 Other $318 $317 Adv & promotion $47 $35 $55 Employment $41 $55 Direct $36 telecommunication $50 $50 $243 $192 $176 1H04 2H04 1H05 Operating expenditure relatively stable, increasingly offset by scale Operating expenditure excludes handset costs 11
Slide 12: Customer Acquisition Costs
Customer Acquisition Costs $392 $389 $269 1H04 2H04 1H05 Customer acquisition costs to decline in 2H05 12
Slide 13: What to Expect in 2H05?
What to Expect in 2H05? • Acquisition focus – 3 post-paid – Orange pre-paid • Improved handset cost, range and functionality • Network leadership • Non-voice service innovation and usage • Profitability trends – scale benefits in margin – reducing customer acquisition costs – operating costs under c
Slide 14: Hutchison
MM Hutchison BM ‘Telecoms Telecommunications operations of Hutchison Whampoa Limited MUL
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