Vodafone Group Public Limited Company · LSE:VOD
Vodafone Group Public — Vodafone Group — XII Telecommunications Conference 2006
22 slides from Vodafone Group Public's conference presentation, Jun 16, 2006
Slide 1: XII Telecommunications Conference
XII Telecommunications Conference Francisco Román CEO, Vodafone Spain Marbella, 16 June 2006
Slide 2: Agenda
Agenda • Market overview • Financial review • Commercial strategy 2 XII Telecommunications Conference - Marbella 16-06-06
Slide 3: Spain - a key market in the Vodafone Group
Spain - a key market in the Vodafone Group Turnover growth FY05/06 EBITDA growth FY05/06 £29.4bn Group +10.0% £11.8bn Group +9.6% Germany +1.2% Germany +2.2% Italy +2.1% Italy -0.4% £4.0bn Spain +22.5% Spain +21% £1.4bn UK -0.3% UK -5.0% Other +21.4% Other +27.8% Vodafone Spain 14% of total Vodafone
Slide 4: Market share evolution
Market share evolution Net adds market share FY05/06 Customer market share March 06 48.4% 28.4% 23.2% 30.5% +1.9p.p. 23.8% -0.1p.p 45.7% -1.8p.p Total net adds Spanish mobile market FY05/06: 4,231,000 Source: Company and external data 4 XII Telecommunications Conference - Marbella 16-06-06
Slide 5: Increasing competition - portability
Increasing competition - portability 450 Portability market evolution (‘000) 420 400 322 325 357 317 328 326 350 314 286 296 287 278 273 300 259 264 272 239 250 220 215 206 204 196 181 178 200 150 100 M ay -04 J un-04 J ul-04 O c t-04 N ov -04 F eb-05 M ar-05 M ay -05 J un-05 J ul-05 O c t-05 N ov -
Slide 6: Four semesters growing above 20% YoY
Four semesters growing above 20% YoY Total turnover growth YoY 24.8% 24.5% 22.4% 20.7% 14.9% 10.9% . 9.1% 9.6% 7.8% 5.1% 6.5% 4.6% H1 04/05 H2 04/05 H1 05/06 H2 05/06 Financial figures are reported according to new IFRS rules from 1st January 2005 for Movistar and from 1st January 2006 for Amena S
Slide 7: Pressures in the Spanish mobile industry
Pressures in the Spanish mobile industry Customers Technology Technology • Growing choice of services • DSL • Converged mobile, • WiFi/WiMAX broadband and internet offerings • VoIP • Mobile number portability Spanish Customers Mobile Competitors Industry Regulation Competitors • Termination rates •
Slide 8: Agenda
Agenda • Market overview • Financial review • Commercial strategy 8 XII Telecommunications Conference - Marbella 16-06-06
Slide 9: Strong revenue growth driven by customer growth and usage stimulation
Strong revenue growth driven by customer growth and usage stimulation FY05/06 FY04/05 ∆% €bn €bn Total Turnover 5.9 4.8 23% Service revenues 5.3 4.3 22% Voice revenues 4.5 3.8 21% Data Revenues 0.8 0.6 29% non-voice as % of service revenues 14.5% 13.6% 6% 9 XII Telecommunications Conference - Marbel
Slide 10: Exceptional customer growth
Exceptional customer growth … Closing customers Closing contract mix +18% +2.7% 49.6% 11,5m 13,5m 46.9% 2004/05 2005/06 2004/05 2005/06 • Investment in customer growth • Encouraging prepay to contract migration • Churn reduced from 21.9% to 20.9% • Consistent focus on High Value Customers Targeted t
Slide 11: ... and ARPU growing YoY
… and ARPU growing YoY ARPU Non-voice services as a % of service revenue +0.8p.p +3% 14.5% €35.6 €34.5 13.6% 2004/05 2005/06 2004/05 2005/06 • Improved customer mix • 29% increase in non-voice service revenue • Driving voice minutes – up 34% • Non-messaging data revenues up 62.1% • Delivering messag
Slide 12: Strong EBITDA growth
Strong EBITDA growth 34.8% 35.3% 2,400 EBITDA (€ MILLIONS) 2,069 * 1,668 24.0% 20,5% 1,600 800 FY04/05 FY05/06 EBITDA EBITDA MARGIN * Excluding the impact of the increased Group charge for brand royalties, the EBITDA margin increases 0.5 p.p. YoY to 35.3% 12 XII Telecommunications Conference - Marbe
Slide 13: Cost analysis
Cost analysis Direct costs & operating expenses1 61.6% 61.1% 14.1% Customer Investment in base costs 14.5% customers % of gross service revenue Other direct 27.0% costs 26.5% Promoting on-net traffic Operating Efficient cost 20.5% 21.8% expenses2 20.0% management 2004/05 2005/06 1 Before depreciatio
Slide 14: Agenda
Agenda • Market overview • Financial review • Commercial strategy 14 XII Telecommunications Conference - Marbella 16-06-06
Slide 15: Commercial strategy: Driving revenue stimulation
Commercial strategy: Driving revenue stimulation Mobility HSDPA Mobile TV TELEVISIÓN Broadband 15 XII Telecommunications Conference - Marbella 16-06-06
Slide 16: Fixed to mobile substitution driving usage
Fixed to mobile substitution driving usage Tarifa Vitamina for the consumer segment 13,000 12,328 12,000 11,507 11,000 10,000 9,454 9,000 8,338 8,000 Voice Minutes (m) 7,000 Outgoing Voice Revenues (€m) 6,000 5,000 4,000 3,000 2,157 2,144 1,782 1,803 2,000 1,000 H1 04/05 H2 04/05 H105/06 H2 05/06 At
Slide 17: Fixed to mobile substitution: Oficina Vodafone
Fixed to mobile substitution driving usage FMS in the Enterprise Space: Oficina Vodafone A mobile line with VPN short Additional options dialling for all employees Vodafone Oficina Accessories Fijo Vodafone widest range All these lines enjoy advanced PABX features anytime, anywhere Fixed Flat tariff
Slide 18: 3G leadership: driving revenue & usage
3G leadership: driving revenue & usage 3G devices 1000,000 902,000 • More than 50% 3G 900,000 market share* 800,000 • 3G: 9% of service 700,000 revenues and 6.7% of 600,000 602,000 customer base (March 06) 500,000 • Strong 3G coverage 400,000 with focus on indoor 314,702 300,000 quality 200,000 159,
Slide 19: Growing 3G data usage: consumer segment
Growing 3G data usage: consumer segment Complete Mobile TV offer Complete music offer More than 600.000 songs Flat tariff: 6€/month available to download • Market leader in Full Track Music Downloads • May 2006: 200k downloads* * Source: Company and External Data 19 XII Telecommunications Conference
Slide 20: Growing 3G data usage: Mobile data solutions for Enterprise
Growing 3G data usage: Mobile data solutions for Enterprise New business devices BlackBerry from Vodafone PDA v1640 Vodafone Mobile Connect Card PDA v1640 Data growth • 3G data accounts for 350 34% of non messaging data (Q4 FY05/06) 300 Data Traffic GB/day 3G Flat Tariff 250 Launch 200 • Boosting mo
Slide 21: Conclusions
Conclusions • Profitable revenue growth by: – Driving usage stimulation – Growing the customer base – Realising cost efficiency • Achieving Fixed to Mobile Substitution: – Through attractive tariffs: Tarifa Vitamina – In the Enterprise space: Oficina Vodafone • 3G/HSDPA: – 3G leadership: driving rev
Slide 22: Trademarks notice
Vodafone, Vodafone Mobile Connect and Tarifa Vitamina are trademarks of the Vodafone Group. Other product and company names used in this presentation may be the trademarks of their respective owners. 22 XII Telecommunications Conference - Marbella 16-06-06
Vodafone Group — XII Telecommunications Conference 2006 on 6ix