Singapore Exchange Ltd. · SGX:S68
Singapore Exchange — M1 — H1 2017 Earnings Presentation
23 slides from Singapore Exchange's earnings presentation, Jul 18, 2017
Slide 1: 1H17 Results Presentation
1H17 Results Presentation 18 July 2017
Slide 2: Forward looking statements – Important note
Forward looking statements – Important note This presentation and the following discussion may contain forward looking statements by M1 Limited (“M1”) relating to financial trends for future periods Some of the statements contained in this presentation or arising from this discussion which are not o
Slide 3: Overview
Overview • Operating revenue increased 2.9% YoY to S$512m Financial Stable service revenue highlights • EBITDA margin at 37.5% of service revenue for 1H17 • Net profit after tax was S$68.8m • Mobile customer base declined 2,000 QoQ to 2.04m Performance • Mobile data revenue was 55.5% of service re
Slide 4: Agenda
Agenda Financial highlights Performance highlights Developments and Outlook 3
Slide 5: Revenues (S$m)
Revenues (S$m) 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 Service revenue (S$m) 204 197 201 202 205 407 406 +2.9% 1H2017 vs 1H2016 512 498 Handset • Handset sales 91 106 sales (+17.1%): Higher sales volume +4.7% Fixed 50 61 services 31 28 • Fixed services revenue 314 -3.5% International (+22.3%): Higher cal
Slide 6: Cost of sales (S$m)
Cost of sales (S$m) +12.3% 1H2017 vs 1H2016 217 +17.5% 193 • Handset costs (+11.8%): Higher 167 sales volume -8.7% 152 • Wholesale costs of 136 Handset costs fixed services 135 113 (+19.1%): Higher 102 103 customer base 88 Traffic Expenses 81 • Other costs 73 72 (+22.2%): Higher 60 Other costs 19 19
Slide 7: Other operating expenses (S$m)
Other operating expenses (S$m) +2.0% 208 204 Depreciation & 1H2017 vs 1H2016 63 amortisation 61 +3.5% Staff costs • Depreciation & amortisation +5.8% Facilities expenses (+2.9%): expenses Higher fixed asset 59 base 110 107 56 103 106 Leased circuit 101 costs 32 33 32 32 • Staff cost (+5.1%): 31 Othe
Slide 8: EBITDA & net profit after tax
EBITDA & net profit after tax EBITDA (S$m) & margin Profit after tax (S$m) & margin on service revenue on service revenue 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 EBITDA margin PAT margin 40.3% 37.8% 35.8% 39.2% 35.9% 40.6% 37.5% 20.1% 17.4% 15.8% 18.0% 15.9% 20.5% 16.9%
Slide 9: Capex & Cash flows
Capex & Cash flows Capex (S$m) Operating and free cash flows (S$m) 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 Operating cash 85 98 50 48 60 187 108 flow Free cash flow -56.0% Spectrum rights payment +5.9% 77 -21.5% 72 -34.6% -45.4% 50 41 114 +88.7% 35 64 20 27 27 50 20 30 17 13 6 9 2Q16 3Q16 4Q16 1Q17 2Q17
Slide 10: Financial leverage
Financial leverage S$m 1H2016 1H2017 Change Cash & cash equivalents 8.2 6.1 -25.6% Net debt 326.8 420.5 28.7% Net assets 400.9 417.4 4.1% Net debt/equity (x) 0.8 1.0 23.6% Net debt/EBITDA (x) 1.0 1.4 46.4% EBITDA/Interest (x) 62.0 37.2 -40.0% Net assets per share (cents) 43.1 44.9 4.1% EPS - diluted
Slide 11: Agenda
Agenda Financial highlights Performance highlights Developments and Outlook 10
Slide 12: Mobile customers
Mobile customers Postpaid customer base (‘000) Prepaid customer base (‘000) +45 1,247 1,271 1,267 1,222 1,232 +19 758 762 772 775 777 2Q16 3Q16 4Q16 1Q17 2Q17 2Q16 3Q16 4Q16 1Q17 2Q17 11
Slide 13: Postpaid mobile
Postpaid mobile Postpaid mobile revenue (S$m) Postpaid monthly ARPU (S$) -1.1% ARPU allocated to handset sales 290 286 -6.8% -5.9% +0.0% 59.9 59.2 56.5 57.1 55.8 55.8 55.7 -0.6% +1.4% 145 142 142 144 138 51.6 49.5 48.6 51.6 48.3 48.5 48.5 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 2Q16 3Q16 4Q16 1Q17 2Q17 1
Slide 14: Prepaid mobile
Prepaid mobile Prepaid mobile revenue (S$m) Prepaid monthly ARPU (S$) -16.4% 37 -14.6% 31 -14.9% -15.6% -4.5% -0.3% 12.3 12.8 12.0 11.5 18 11.0 10.5 10.8 17 16 15 15 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 13
Slide 15: Mobile market share
Mobile market share Overall market share* Postpaid & Prepaid market share* Postpaid 24.7% 24.7% 24.8% 24.9% 25.0% 2Q16 3Q16 4Q16 1Q17 Apr-17 23.7% 23.7% 23.8% 24.0% 24.2% Prepaid 22.2% 22.1% 22.5% 22.6% 23.0% 2Q16 3Q16 4Q16 1Q17 Apr-17 2Q16 3Q16 4Q16 1Q17 Apr-17 * - Based on published statistics ava
Slide 16: Postpaid mobile
Postpaid mobile Acquisition cost Monthly churn rate (postpaid) per postpaid customer (S$) +15.2% 438 +3.6% +14.5% 379 372 357 366 329 325 1.7% 1.4% 1.2% 1.0% 1.0% 0.9% 0.9% 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 Note: Cash basis 15
Slide 17: Tiered data plans & mobile data contribution
Tiered data plans & mobile data contribution Data contribution Tiered data plans to mobile service revenue Postpaid customers on tiered data plans Percentage of tiered data plan customers exceeding primary data bundles 32% 26% 28% 27% 25% 54.8% 55.1% 55.5% 55.3% 54.0% 54.2% 53.6% 78% 79% 75% 76% 77%
Slide 18: Fixed services
Fixed services Fibre customer base (‘000) Fibre monthly ARPU (S$) +31 -5.3% 176 168 -1.6% -6.5% 160 152 145 45.1 45.7 46.0 43.1 43.4 42.7 43.0 2Q16 3Q16 4Q16 1Q17 2Q17 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 17
Slide 19: International call services
International call services International retail minutes International call services (million mins) revenue (S$m) +1.5% 334 339 +0.0% -9.6% -8.0% 31 -8.6% 28 187 175 176 162 162 +0.7% 15 15 15 14 14 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 2Q16 3Q16 4Q16 1Q17 2Q17 1H16 1H17 18
Slide 20: Agenda
Agenda Financial highlights Performance highlights Developments and Outlook 19
Slide 21: Developments and outlook
Developments and outlook • New entrants will lead to increase in competitive activities Changing • OTT services continue to impact traditional telecom revenue landscape • Digital economy presents new opportunities • Enhance service propositions to address changing customer preferences • Nationwide N
Slide 22: Outlook
Outlook • Move up value chain with integrated solutions Managed infrastructure services Cyber security Applications and business solutions Corporate Analytics segment • Readiness for Smart Nation initiatives Pilot new digital solutions Interactive info-display, unified analytics, intelli
Slide 23: Thank you
Thank you 22