Vodafone Group Public Limited Company · LSE:VOD
Vodafone Group Public — Vodafone Group — Q1 FY2020 Earnings Presentation
21 slides from Vodafone Group Public's earnings presentation, Jul 26, 2019
Slide 1: Vodafone Group Results: for the quarter ended 30 June 2019
Vodafone Group Results: for the quarter ended 30 June 2019 26 July 2019
Slide 2: Disclaimer
Disclaimer By watching this webcast, you agree to be bound by the following conditions. You may not This presentation also contains non-GAAP financial information which the Vodafone Group’s disseminate the slides or any recording of this webcast, in whole or in part, without the prior management bel
Slide 3: Q1 20 Highlights
Q1 20 Highlights Deepening Accelerating Improving Portfolio customer digital & radical asset management engagement simplification utilisation Record low Speed-tiered Network sharing Liberty Global mobile contract churn unlimited plans deals signed in Spain/UK, Italy imminent, acquisitions approved,
Slide 4: Deepening customer engagement: reducing churn, driving convergence
Deepening customer engagement: reducing churn, driving convergence Improvement in mobile contract churn, Q1 YoY (pp) EU fixed net adds (m) Broadband NGN Converged2 Italy 428 7.8 414 (prepaid) 352 Spain 1.5 317 289 Turkey 1.2 257 243 237 226 UK 0.9 188 Germany 0.6 128 122 119 115 Europe¹ 0.5 54 South
Slide 5: Radical simplification: speed-tiered unlimited launches
Radical simplification: speed-tiered unlimited launches Spain: targeting ARPU accretion on the base UK: consumer challenger Included (except 1GB plan) • Competitor promotional “RED” 1GB 5GB 20GB £11.00 £15.00 £20.00 reaction subsided at the end of June Unlimited Lite Unlimited Unlimited Max “Unlimit
Slide 6: Europe's leading converged operator post Liberty acquisitions
Europe’s leading converged operator post Liberty acquisitions Infrastructure owner More fixed/converged Synergy opportunity Europe NGN homes coverage mix1 EU consumer service revenue Net present value On-net Strategic partnership NGN Wholesale Europe fixed/converged Europe mobile only >€6.0bn cost a
Slide 7: Vodafone/Unitymedia: Gigabit advantage to drive on-net broadband growth
Vodafone/Unitymedia: Gigabit advantage to drive on-net broadband growth Marketable homes in Germany Significant opportunity to drive Germany proforma (m) broadband penetration1 contribution to the Group2 25 c.30% 49% Revenue 46% 3x 36% 32% c.35% EBITDA c.8 c.40% FY 22E FY 22 Vodafone Operating Other
Slide 8: KDG learnings and capabilities enable faster integration of Unitymedia
KDG learnings and capabilities enable faster integration of Unitymedia Cumulative cost and capex synergies KDG Unitymedia Integration to start immediately Annual c.€425m • Strong fixed capabilities post KDG Integration milestones Initial €300m • Detailed plan developed: target – Top management reorg
Slide 9: Creating Europe's largest tower company
Creating Europe’s largest tower company Number of sites (tenancy ratio)4 Controlled operations JV Sites (Tenancy ratio) European TowerCo • Industrial savings through active and passive network sharing largely secured ahead of monetisation 13,200 (1.1) – Spain/UK signed – Italy imminent 1,500 (1.4) –
Slide 10: Tower monetisation to unlock significant embedded value
Tower monetisation to unlock significant embedded value European TowerCo structure Step 1: Legal separation Step 2: Create HoldCo Monetisation principles • Capture active and passive network sharing European benefits first Opco Opco Opco TowerCo • Maintain network differentiation and strategic flexi
Slide 11: Financial review
Financial review Margherita Della Valle Group Chief Financial Officer
Slide 12: Organic service revenue growth improving
Organic service revenue growth improving Group Regions 0.9 Europe Rest of the World 7.2 7.3 0.3 5.4 5.7 5.3 0.0 (0.2) (0.7) (0.6) (1.1) (1.7) (2.1) (1.7) Q1 19 Q2 19 Q3 19 Q4 19 1 Q1 20 Q1 19 Q2 19 Q3 19 Q4 19 1 Q1 20 Key movements in Q1: Regional dynamics: • Italy: 28 day billing impact in the prio
Slide 13: Germany: robust retail revenue growth
25% Germany: robust retail revenue growth of service revenue Q1 service revenue +0.4% (Q4 +0.3%1) Service revenue growth (%) Reported Retail (service revenue ex. wholesale) Simplifying mobile pricing 1.8 1.7 Removing discounts, €5 premium for 5G 1.6 1.5 1.4 Slower broadband market growth 1.3 DSL imp
Slide 14: Italy: competition moderating; UK: commercial momentum
13% 14% Italy: competition moderating of service revenue UK: commercial momentum of service revenue Q1 service revenue -3.8% (Q4 -7.0%) Q1 service revenue +0.1% (Q4 -0.2%) Market net ports (m) Net adds (000s) Mobile contract1 Fixed broadband 104 109 5.6 -34% 77 3.9 3.8 YoY 66 2.9 53 50 2.6 44 46 40
Slide 15: Spain: promotional quarter; Other Europe: good growth
11% 13% Spain: promotional quarter of service revenue Other Europe: good growth of service revenue Q1 service revenue -9.3% (Q4 -7.9%) Q1 service revenue +2.1% (Q4 +2.5%) Vodafone Consumer mobile contract net ports Service revenue growth (%) 14 3.4 3.3 4 2.5 2.3 2.1 (3) (24) Q1 19 Q2 19 Q3 19 Q4 19
Slide 16: Vodacom: regulatory headwinds in SA, strong International growth
12% Vodacom: regulatory headwinds in SA, strong International growth of service revenue Q1 service revenue +1.1% (Q4 +3.5%) Service revenue growth (%) South Africa Internationals Full quarter impact from out-of-bundle regulation in SA 14.9 -2.5pp drag QoQ 11.1 Data demand accelerating, Telkom roamin
Slide 17: Summary
Summary • Revenue trend improving, gradual recovery to continue • Deepening customer engagement: H1 significant commercial launches, continued record low mobile churn • Radical simplification: good progress towards €400m FY 20 EU opex target • Improving asset utilisation: network sharing deals agree
Slide 18: Appendix
Appendix 18
Slide 19: Pro-forma European NGN footprint
Pro-forma European NGN footprint1 Household coverage (m)2 Owned Strategic partnership3 Acquired assets Wholesale % Household coverage 76% 72% 80% 88% 65% 94% 37% 7.3 11.0 12.7 13.7 28.2 12.8 10.4 0.3 3.8 7.2 6.4 2.9 2.9 Germany Italy Spain UK Portugal VodafoneZiggo NLJV CEE 124m Households passed wi
Slide 20: Forward-looking statement
Forward-looking statement This presentation, along with any oral statements made in connection therewith, contains “forward-looking the Vodafone Group of, or the rates the Vodafone Group may charge for, terminations and roaming minutes; the statements” including within the meaning of the US Private
Slide 21: More information
More information Visit our website for more information Upcoming dates Digital First Open Office H1 Q3 10 Sept 12 Nov 6 Feb Contact us ir@vodafone.co.uk www.vodafone.com/investor For definitions of terms please see www.vodafone.com/content/index/investors/glossary 21