Dialog Axiata PLC · CSELK:DIAL.N0000
Dialog Axiata — Dialog Telekom — H1 2007 Earnings Presentation
31 slides from Dialog Axiata's earnings presentation, Jul 31, 2007
Slide 1: Investor Forum First-Half 2007
Investor Forum First - Half 2007 31 July 2007
Slide 2: Agenda
Agenda Financials Financials Subsidiary / SBU Performance Recent Developments
Slide 3: 1H 07 Highlights
1H 07 Highlights Growth in subscribers YoY 43% (net adds of 1.095 Mn) Churn down to 6.9% from 12.3% Dialog Telekom PAT : Rs. 5.25 Bn. Dialog Telekom Group PAT : Rs. 4.87 Bn. Equity Investment of Rs. 15.54 Bn. to Fuel Growth
Slide 4: Snapshot – 1H 2007 – Company
Snapshot –1H 2007 – Company Change YoY Growth Cellular subscribers 3.66 Mn. 1.09 Mn. 43% Key Financials Change Growth USD Mn Rs Bn. (1H06 vs. 1H07) (1H06 vs. 1H07) NP of Rs. 4,868 Mn. Revenue 135 14.83 Rs. 2,796 Mn. 23% EBITDA 68 7.46 Rs. 1,062 Mn. 17% PAT 48 5.25 Rs.368 Mn. 8% ^Exchange rates appli
Slide 5: Snapshot – 1H 2007 – Group
Snapshot –1H 2007 – Group Dialog Telekom NP of Rs. 5,253 Mn Dialog Net loss of Rs. 7.79 Mn. Broadband Asset Media Net loss of Rs. 350 Mn. Dialog Group NP of Rs. 4,868 Mn. Key Financials Growth USD Mn Rs Bn. Change (1H06 Vs 1H07) Revenue 140 15.36 Rs. 3,077 Mn. 25% EBITDA 66 7.24 Rs. 641 Mn. 10% PAT
Slide 6: P&L Highlights
P&L Highlights (all figures in Rs. Mn. Group Company except for ratios) Six Months ended 30 June Six Months ended 30 June 2007 2006 Change(%) 2007 2006 Change(%) Net Revenue* 15,357 12,280 25 14,827 12,031 23 Direct Costs 5,935 4,271 39 5,305 4,151 28 Gross Profit 9,422 8,009 18 9,522 7,879 21 Gross
Slide 7: Financials – Company Performance Overview
Financials Financials Company CompanyPerformance PerformanceOverview Overview
Slide 8: Highlights – 1H 2007 - Company
Highlights –1H 2007 - Company Subscriber Base Units 1H-07 1H-06 Postpaid Thousands 519 469 Pre-paid Thousands 3,137 2,093 Total active subscriber base Thousands 3,657 2,562 Total Net Additions Thousands 550 438 Operational Results Units 1H-07 1H-06 Blended ARPU Rs. 601 683 Pre-paid ARPU Rs. 414 432
Slide 9: Revenue Drivers
Revenue Drivers Subscriber (Thousands) +43% +9% • Market leadership with sustained growth in subscribers ( 43 per cent YoY) 3,657 3,365 3,106 2,835 3,137 2,562 2,879 2,621 • Pre/post mix: 86:14 2,359 2,093 • Coverage and Quality of Service Improvements coupled with Introduction of innovative Value a
Slide 10: Revenue Environment
Revenue Environment Revenue growth of 23% recorded despite certain revenue flows being suppressed due to Macro-Environmental Factors: Intermittent disruptions of the company’s services in the Northern and Eastern Provinces of Sri Lanka Decline in inbound roaming revenue, in line with the drop
Slide 11: Revenue - Company
Revenue - Company • Steady growth in revenue– 22 per cent increase over 2Q06 • Prepaid revenue- the dominant contributor to revenue with 48 per cent share – ( growth of 47 per cent 1H06 vs. 1H07 ) • Termination revenue increased by 31 per cent. • Reduction in inbound roaming revenue following a drop
Slide 12: Direct Costs - Company
Direct Costs - Company • On sequential quarters (1Q07 to 2Q07) direct cost as a percentage of operating revenue has improved by 2 per centage points. • Direct Costs increased only marginally by 1 percentage point (relative to revenue) in 2Q07 compared to performance in the 2Q06 . 37% 37% 35% 36% 0.1
Slide 13: Network Costs - Company
Network Costs - Company (all figures in Rs. Mn.) 1H-06 % of Revenue 1H-07 % of Revenue Net Revenue 12,031 14,827 Network Related Costs Lease Circuit Rental 175 1.45 144 0.97 International Telecommunication Levy 423 3.52 561 3.78 Telecom equipment depreciation 1,113 9.25 1,488 10.04 International Ori
Slide 14: International Telecommunication Levy claim process
International Telecommunication Levy claim process In March 2007, TRCSL issued the procedure for disbursements from Telecommunications Development Fund (TDF). Accordingly Dialog would be entitled for 2/3 of VGF contribution (US 3.80 cents) amounting to US 2.54 cents per each international minute
Slide 15: Operating Costs - Company
Operating Costs - Company • Opex as a percentage of revenue increased by 4 percentage points in 2Q07 vis-à-vis 2Q06 . Performance relative to revenue is mitigated in the main due to the company not achieving its full revenue potential due to uncontrollable macro conditions. (all figures in Rs. Mn.)
Slide 16: Selling Expenses - Company
Selling Expenses - Company • Selling Expenses as a percentage of revenue has improved by 3 percentage points QoQ. • Selling Expenses maintained close to 10 per cent of Revenue despite 43 per cent growth in subscribers YoY. (all figures in Rs. Mn.) 1H-06 % of Revenue 1H-07 % of Revenue Change % Net R
Slide 17: PAT and EBITDA Margins - Company
PAT and EBITDA Margins - Company • PAT has been negatively impacted by the escalation of benchmark interest rates (resulting in an escalation in the cost of funding) and foreign exchange translation losses arising due to negative movements in the foreign exchange conversion rate of the SLR. • PAT pe
Slide 18: Balance Sheet
Balance Sheet • Net Asset per share of the Company has increased by 51% following the rights issue. (all figures in Rupees Thousands) 30 June 2007 31 December 2006 Group Company Group Company ASSETS Non - current assets 39,665,081 36,454,267 33,634,237 31,329,629 Current assets 21,416,862 22,242,449
Slide 19: Cash Flow Highlights - Company
Cash Flow Highlights - Company • Net Cash flows from operating activities up 18 per cent compared to1H-06. (all figures in Rs.Mn.) 1H-07 1H-06 Net cash from operating activities 5,426 4,602 Net cash used in investing activities (6,843) (3,749) Net cash used in financing activities 11,724 (3,062) Inc
Slide 20: Reconciliation of Cash Generated from Operations
Reconciliation of Cash Generated from Operations - Company (all figures in Rs. Mn.) 1H-07 1H-06 Profit before Tax 5,308 4,950 Adjustments for: Interest Expenses 415 128 Depreciation 1,688 1,185 Amortisation 54 77 Retirement Benefit Obligation 16 15 Other Adjustments* (1,624) (1,648) (incl. Changes i
Slide 21: KPIs - Company
KPIs - Company • Net Debt/ EBITDA has reduced largely due to improved cash position after the rights issue in June 2007. • RoE diluted due to increase in shareholders funds following the equity issue. Ratio Units 30-June 31-Dec 2007 2006 Net tangible assets per share Rs. 5.09 3.36 Net Debt to EBITDA
Slide 22: Earnings per Share - Company
Earnings per Share - Company • EPS increased 5 per cent to 70 cents per share. Description Units 1H-07 1H-06 Net Income Applicable to ordinary shares Rs. Mn. 5,253 4,885 Weighted average number of shares, end of period Mn. 7,490 7,311 (adjusted for effects of rights issue & ESOS shares exercised) EP
Slide 23: Lenders - Company
Lenders - Company Summary of Outstanding borrowings Institutions Type of Facility Currency Facilities Amt Principal Outstanding Less than More than USD Mn eqv. USD Mn eqv. one year one year IFC Term Loan USD 15.00 11.25 2.50 8.75 Citi / Commercial Syndicated Loan USD 4.20 1.59 0.58 1.01 Citi / Comme
Slide 24: Subsidiary / SBU Performance
Financials Subsidiary Subsidiary//SBU SBUPerformance Performance Recent Developments
Slide 25: International Business
International Business Contribution to DTL group bottom line - 10 per cent. 31% growth in International termination revenue International Fibre backbone through SMW3 and SMW4 Best in Class International Gateway infrastructure with Soft switching to handle growth in traffic volumes
Slide 26: Dialog Broadband Networks (Pvt) Ltd. (DBN)
Dialog Broadband Networks (Pvt) Ltd.(DBN) DBN recorded a revenue of Rs. 420.96 Mn up 14 per cent relative to the Rs. 368.76 Mn. recorded for the first-half of 2006. DBN recorded a net loss of Rs. 7.79 Mn. for the first half of 2007 vis-à-vis a profit of Rs. 80.07 Mn for recorded for first half o
Slide 27: Dialog Television (Pvt) Ltd.
Dialog Television (Pvt) Ltd. DTV Group (inclusive of subsidiaries Communiq Broadband Network (Pvt) Ltd (CBN) and CBN SAT (Pvt) Ltd) recorded a revenue of Rs. 285.42 Mn, on the backdrop of over a 100 per cent growth in subscribers within the first- half of operations. The company recorded a net l
Slide 28: Recent Developments – Updates
Financials Subsidiary / SBU Performance Updates Updates
Slide 29: Updates
Updates • Rs. 15.54 Billion Equity Infusion via Rights Issue The Company’s Rights issue was successfully subscribed for by over 100%, thereby making the issue the largest ever equity raising to be executed in the Sri Lankan Capital market. • Dialog Telekom signed another landmark investment agreemen
Slide 30: Key Product / service initiatives
Key Product /service initiatives •Launched CDMA in 6 districts. DBN will expand its fixed wireless operation into four more districts including Colombo, during the second half of the year. •Introduced eZ buddy service. 'eZ buddy' acts as a mobile phone booth. 'eZ buddies' add convenience to the cons
Slide 31: Thank you
Thank you @e TELEKOM