Mtn Group Limited · JSE:MTN
Mtn — MTN Nigeria — Investor Day (May 2013)
148 slides from Mtn's investor day presentation, May 2013
Slide 1: MTN Nigeria Analysts' Presentation May 2013
MTN Nigeria Analysts’ Presentation May 2013
Slide 2: CEO's Overview
CEO’s Overview everywhere you go
Slide 3: MTN Nigeria Management Team
MTN Nigeria Management Team Brett Goschen Chief Executive Officer Lynda Saint-Nwafor Andrew Bing Larry Annetts Akin Braithwaite Chief Technical Chief Financial Chief Marketing Customer Relations Officer Officer Officer Executive Wale Goodluck Amina Oyagbola Charles Molapisi Babatunde Osho Corporate
Slide 4: Contents
Contents • Country Overview • MTN Nigeria Corporate Profile • 2012 Performance Review • Looking Ahead 4
Slide 5: Country Overview
Country Overview Penetration into Addressable Population 161m Market sizing 141.9m (2014) Population Penetration 38% Market 73% Economics GDP per capita (US$ at PPP) US$1,490 Source: NBS Inflation 8.6% Source: CBN Commercial banks' Maiduguri prime lending rate 16.6% Kano Source: CBN Exchange rat
Slide 6: Environment Scan
Environment Scan Political • Political instability • Challenges in the relationship between the executive and the legislature arm of government partly due to disagreements over national budget planning and implementation. • Incidence of insecurity, Infrastructure widespread flooding and other socio-
Slide 7: GSM Competitors – December 2012
GSM Competitors – December 2012 MTN Airtel Glo Etisalat Launch date 2001 2001 2003 2007 Subscribers 47.4m 19.6m 18.8m 13.9m Market share 47.56% 19.62% 18.88% 13.93% MTNI (78.8%) Airtel (79.1%) 100% local EMTS (40%) Shareholders Private (21.2%) Private (20.1%) shareholding Mubadala (30%) PTHL (30%)*
Slide 8: MTN Nigeria Shareholders and Board of Directors
MTN Nigeria Shareholders and Board of Directors Board of directors MTN Group P Dozie (Chairman) 78.83% MTN Reps R S Dabengwa P Norman N Patel J Desai Executive Directors Individual local B Goschen (CEO) A Bing (CFO) shareholders Non-executive Directors 8.73% P Dozie V Odilli M S Bello G Oyebode Shar
Slide 9: MTN Nigeria Corporate Profile
MTN Nigeria Corporate Profile MTN Launch date August 2001 Subscribers 51.3m (Q1 2013) Market share 49.7% (Q1 2013) Shareholders MTNI (78.8%) Private (21.2%) • Digital Mobile Licence (DML): February 2001 – January 2016 • Unified Access Service License (UASL): September 2006 – August 2021 • 3GHz Spect
Slide 10: Radio Network Rollout
Radio Network Rollout ci> MTN NIGERIA ACTIVE BTS SITES cZ> Mar. 2073 Active Sites a ers NWG Regons
Slide 11: Network Coverage
Network Coverage MTN NIGERIA NETWORK COVERAGE April. 213 LEGEND abun COVERAGE CS 3G COVERAGE 2G + 2.5G COVERAGE 11
Slide 12: Data Coverage
MTNN FIBRE NETWORK INFRASTRUCTURE | LEGEND Dec. 2012 2 OADN Sites Muitilinks Swap MTNN Fibre Route (Live) 12
Slide 13: 2012 Performance Review
2012 Performance Review • Subscribers/ARPU/Revenue • Net Additions • Market Share • Capex / BTS Rollout • Data 13
Slide 14: Nigeria - operational highlights
Nigeria - operational highlights Market share 49.7% Launched Aug 2001 Population 161m Market sizing 141.9m (2014) Penetration 64% (Q1 ‘13) Subscribers (‘000)/ARPU ($) • Significant increase in net additions 51 295 47,440 38 669 41 641 • Attractive segmented value propositions 30 827 • Significant fi
Slide 15: MOU / ERM (USD) Trend
MOU / ERM (USD) Trend Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 MOU 2 556 2 866 3 637 3 953 4 716 ERM 0.123 0.09 0.07 0.067 0.062 MOU ERM 15
Slide 16: Average Daily Revenue (NGN m)
Average Daily Revenue (NGN m) Average daily revenue Average daily rev 16
Slide 17: Market Share – 7 Months Trend
Market Share – 7 Months Trend MTN gained ~2.14% subscriber share through effective dormancy management initiatives and targeted penetration of first timers (with attractive proposition). 49.70% 49.28% 48.83% 48.06% 47.90% 18.63 18.80 47.82% 19.15 19.62 19.33 19.40 19.40 47.56% 19.74 19.57 19.39 18.8
Slide 18: Nigeria - infrastructure highlights
Nigeria - infrastructure highlights Capex • Rollout achievements for 2012 NGN (billion) • successfully implemented a large network swap and modernisation programme • Achieved 108% of 2012 Capitalisation Target 258 180 • 1,175 3G BTS’s rolled out 129 96 79 • Achieved 100% WACS availability and Dec-09
Slide 19: Network Infrastructure
Network Infrastructure Network Infrastructure Dec-11 Jun-12 Dec-12 Mar-13 2G BTS Sites (Cumulative) 7,046 7,600 8,457 8,905 3G BTS Sites (Cumulative) 2,074 2,636 3,250 3,481 Number of km of fibre rolled out (Cumulative) Backbone Metro (Cumulative) 9,077 9,169 9,738 10,432 Fibre to site (Cumulative)
Slide 20: Data Revenue
Data Revenue NGN bns Data % revenue (Incl sms) 1Q 2013 – 17% 2012 - 13% 2011 – 9% 13.7 Data revenue grew by 78% between 2011 and 2012 due to: 21.3 • 131% growth in Internet and blackberry with introduction of various bundled device, data packages and blackberry value 6.4 proposition during the year.
Slide 21: Data Success stories in VAS Segment
Data Success stories in VAS Segment (Afrinolly, MTN Play etc.) Total Afrinolly app download, Total minutes viewed per Afrinolly per Device Type content category 3 000 30 Thousands Millions 2 000 20 1 000 10 0 0 Jul Sept Dec Mar Jul Sep Dec Mar Android Blackberry Nokia Movies Music Celebrities 2.3m
Slide 22: Looking Ahead
Looking Ahead • Aggressive Network rollout – 2G and 3G • Creating a distinct customer experience at all touch points • Continued acquisition drive • Effective churn management • Driving local content in Apps • Cost effectiveness and Efficiency 22
Slide 23: MTN Nigeria Financial Overview
MTN Nigeria Financial Overview
Slide 24: Trend of Key Performance Matrix
Trend of Key Performance Matrix Revenue (N'bn) Costs Nbn (COS+Opex) EBITDA Nbn Data Revenue (Nbn) Net Connections (millions) RGS (millions) 24
Slide 25: Trend of Key Performance Matrix (Cont'd)
Trend of Key Performance Matrix (Cont’d) Market Share Outgoing MOU (millions) Incoming MOU (millions) BTS Additions Capitalisation (N'bn) ERM (N) 25
Slide 26: Income statement
Income statement NGN bns 2012 2011 % Change 2010 FY’11 V FY’12 Revenue 754 758 (0.5%) 692 EBITDA 440 468 (6.0%) 437 EBITDA Margin % 58% 62% (4.0%) 63% Depreciation (110) (104) (5.8%) (104) Amortisation (10) (8) (25.0%) (4) Profit from operations 320 359 (10.9%) 333 Finance cost (14) (18) 22.2% (28)
Slide 27: Revenue and Operating Cost
Revenue and Operating Cost NGN bns 2012 2011 % Change 2010 2009 2008 FY’11 V FY’12 Airtime and Subscriptions 537.9 595.6 (9.7%) 580.8 493.6 370.9 Interconnect 92.3 91.7 0.7% 59.4 72.0 62.2 Data 105.8 59.6 77.5% 40.9 22.6 15.8 Others 17.5 11.1 57.7% 10.7 8.1 6.4 Total Revenue 753.6 758.0 (0.6%) 691.8
Slide 28: Revenue analysis
Revenue analysis • Intense competition among the operators in order to maintain market share • Dilution of Effective Rate per Minute (ERM) from N22.20 in 2011 to N14.98 in 2012 595.6 • MOU during the period grew by 39% (from 2.84b minutes in 537.9 2011 to 3.95b minutes in 2012) • Interconnect revenu
Slide 29: Effective Rate per Minute
Effective Rate per Minute N34.70 N28.10 N28.21 N22.20 N14.98 2008 2009 2010 2011 2012 29
Slide 30: Monthly & Average Daily Revenue (NGN bns)
Monthly & Average Daily Revenue (NGN bns) Monthly Revenue Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Others Data Interconnect Airtime and Subscriptions Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 30
Slide 31: Interconnect Analysis
Interconnect Analysis NGN bns 100.0 91.7 92.3 80.0 72.0 66.8 62.2 59.4 60.0 49.6 49.0 41.0 38.6 40.0 20.0 0.0 2008 2009 2010 2011 2012 Interconnect Revenue Interconnect Cost Net Interconnect Revenue (N'b) 46.9 30.2 26.0 24.6 23.7 FY'08 FY'09 FY'10 FY'11 FY'12 31
Slide 32: Operating Expenses Analysis
Operating Expenses Analysis • Facilities cost • 15% increase in the number of integrated sites and >100% growth in number of Hybrid sites 50.1 • Marketing costs 43.3 42.1 • Decline due to costs saving measures 38.9 implemented in FY’12 i.e. lower rates from 33.8 33.6 Vendors (for instance media agen
Slide 33: Fuel Usage & BTS Additions Analysis
Fuel Usage & BTS Additions Analysis 153.7 151.8 142.4 137.3 112.4 2 214 2 589 1 984 1 620 983 2008 2009 2010 2011 2012 Litre (m) BTS ADDS 33
Slide 34: EBITDA and key drivers
EBITDA and key drivers • EBITDA declined by 6% between 2011 500 100% and 2012 due to: 450 90% • Intense competitive pressures in the industry 80% 400 leading to decline in tariffs (ERM decreased by 70% 33% over the period) 350 62% 58% 60% • High volume of freebies to subscribers 300 • Security risks
Slide 35: Tax Reconciliation
Tax Reconciliation Material reconciling items: Effective tax rate reconciliation 27.1% • Company’s Income Tax 30.0% 43% • Education tax 2.8% • Expenses not Allowed 2.6% 32% 32% 32% • Investment allowance relief (2.0%) 27% • Prior year Tax Overprovision (2.0%) • Exempt Income (FGN Bond) (4.3%) Dec-08
Slide 36: Balance Sheet
Balance Sheet NGN bn 2012 2011 2010 Non-current assets 622 497 473 Property, plant & equipment 553 436 422 Intangible assets 37 36 28 Non-Current Prepayments 32 25 23 Current assets 158 334 243 Bank balances 36 107 170 Restricted cash 34 2 2 Other current assets 88 226 71 Total assets 779 831 716 Ca
Slide 37: Statement of cash flows
Statement of cash flows NGN bn 2012 2011 2010 Net cash generated from operations 456 504 440 Taxation paid (103) (61) (50) Cash inflows from operating activities 353 443 390 Acquisitions of PPE (228) (127) (96) Proceeds from sale of PPE (42) (5) 4 Other Investments 130 (156) (3) Interest received 34
Slide 38: Average Exchange Rate
Average Exchange Rate 200 30 160 120 80 40 0 15 2005 2006 2007 2008 2009 2010 2011 2012 USD:NGN ZAR:NGN •Rates are year-end rates • USD:NGN rate has witnessed a lot of fluctuation over the years. The CBN is however making significant efforts to ensure stability of the NGN 38
Slide 39: Interest Rate & Inflation Rate
Interest Rate & Inflation Rate 20.00 15.00 10.00 5.00 - 2008 2009 2010 2011 2012 Annual Interest rate (%) Annual Inflation Rate (%) 39
Slide 40: Funding Structure
Funding Structure MTN Nigeria has a loan portfolio with a consortium of local banks and foreign banks Restructured & • $1.2bn and $900m term loan facilities (Indexed on NIBOR plus Margins) Additional Local • 6.5 years tenor Currency Facility • Repayable in 9 equal semi-annual installments from Novem
Slide 41: Topical Regulatory Issues May 2013
Topical Regulatory Issues May 2013
Slide 42: Outline
Outline 1. Overview of Nigeria Regulatory Landscape 2. Licensing & Spectrum Issues 3. Topical Issues 4. Multiple Regulation 5. Policy Developments 6. Emerging Trends 7. Focused Engagement 8. Snap Shot of Regulatory Fees & Taxes 42
Slide 43: Overview of Nigeria Regulatory Landscape
Overview of Nigeria Regulatory Landscape Background • Historical stable regulatory environment • Policy direction provided by the Ministry of Political Communications Technology; Regulatory influences/tensions oversight provided by Nigerian Communications Commission (NCC) Ongoing security challenges
Slide 44: Licensing & Spectrum Issues
Licensing & Spectrum Issues Licenses Snapshot of MTN Licenses License Year of issue Term Expiry Date • Unified Licensing framework in operation. • Review of licensing structure anticipated DML 9th Feb 2001 15yrs 8th Feb • Focus on competition compliance – designation 2016 of dominant operators and m
Slide 45: Topical Key issues
Topical Key issues • Competition Regulation Key drivers: ̵ MTN declared a dominant operator in mobile voice market and jointly • Consumer dominant (with Glo) in Wholesale Leased line/Transmission market interests segments with attendant obligations – engagement and mitigation on- • Political going.
Slide 46: Overlapping/Multiple Regulation & Taxation
Overlapping/Multiple Regulation & Taxation Features Drivers: • Overlapping MDAs = duplicated jurisdictions/charges • Revenue generation • Illegal taxes & Levies • Turf wars • Creation of local & State versions of federal taxes • “Cash Cow” / “Golden • Taxation without legal basis/spurious instrument
Slide 47: Policy Developments
Policy Developments ICT Policy • Ongoing development of holistic ICT industry policy to provide basis for proposed sector convergence and transformation strategies • ICT Policy thrust to render Nigeria a true knowledge society with significant opportunities for growth especially in data space. • MTN
Slide 48: Emerging Trends
Emerging Trends • Critical Infrastructure Protection • Concerted industry efforts on two fronts: • Secure formal declaration of telecoms infrastructure as Critical National Infrastructure (CNI) • Actualize Critical Infrastructure Protection Legislation • Ministerial buy-in at executive level to fort
Slide 49: Focused Engagement
Focused Engagement Compliance & Issue Policy Development & Engagement: Monitoring: Input: • Regular meetings with • Active participation in • Formal & informal stakeholders regulatory proceedings with • Direct & indirect • Structured review of regulatory relevant departments • Hand-holding sessions
Slide 50: Appendix: Regulatory Fees & Other Govt Payments
Appendix: Regulatory Fees & Other Govt Payments From Inception to December 2012 Description Payment terms Total paid 2001 – Total paid 2001 – 2012 Dec ₦ 2012 Dec $ AOL 2.5% of annual Net revenues 89,564,399,472 655,885,170 Spectrum Case-by-case basis + annual renewals 6,239,349,525 45,691,110 Number
Slide 51: Marketing Presentation to the Analysts
MTN Nigeria Marketing Presentation to the Analysts
Slide 52: Agenda
Agenda • Competitive landscape • Q1 Performance Highlight • MTR reduction and MNP : Strategic Response • 2013 Strategic Theme and Initiatives • Aggressive data drive • VAS/Product Innovation • Churn/Dormancy Management • Agent Banking :Mobile Money • Segmented Value proposition 52
Slide 53: Competitive Landscape
Competitive Landscape 53
Slide 54: Competitive Overview: Jan- March 2013
Competitive Overview: Jan- March 2013 Airtel Nigeria • Despite regulators' ban and continued to leverage 9x bonus for growth. • Medium value multi-simming drive, as a source of secondary growth with discounted Samsung Duo bundle offer. • Enhanced data strategy (Samsung Hero series and HTC Window pho
Slide 55: 2013 Q1 Performance Snapshot
2013 Q1 Performance Snapshot 55
Slide 56: RGS increased 19.6% while ERM declined
MTNN RGS increased by 19.6% between March 2012 and March 2013 while ERM declined by 47% for same period. MoU/sub 90 95 90 100 87 88 76 74 79 79 76 83 78 72 77 ERM with bonus 56
Slide 57: MTN gained ~2.14% subscriber share
MTN gained ~2.14% subscriber share through effective dormancy management initiatives and targeted penetration of first timers (with attractive proposition) 4 7 .9 0 4 8 .0 6 4 7 .8 2 4 7 .5 6 4 8 .8 3 4 9 .2 8 4 9 .7 0 18.63 18.80 19.15 19.62 19.33 19.40 19.40 19.74 19.57 19.39 18.88 18.31 18.01 17.
Slide 58: %Gross Connection GC 2013 growth
Competitive offers for new entrant and seasonality impacted on Gross connection growth. However, MTN maintained 32.5% lead on YTD average vs others. %Gross Connection GC 2013 growth Sept '12 Oct '12 Nov '12 Dec '12 Jan 13 Feb '13 Mar '13 YTD MTN 1,763,293 1,751,162 1,788,507 2,096,710 2,070,466 1,83
Slide 59: Market share drivers: MTN has 56% share of first-timers
Market share drivers in the month : MTN has 56% share of first- timers (a 9% point growth from Nov12) and has maintained a stable figure amongst the multi-simmers Sep Oct Nov Dec Jan Feb Mar 2012 2012 2012 2012 2013 2013 2013 % new connections with previous SIM 68 74 66 65 68 65 63 % new connections
Slide 60: MNP, MTR and Dominance Operator status
MNP , MTR and Dominance Operator status MTN’s strategic response 60
Slide 61: MTN Nigeria MNP Go-to-market strategies
MTN Nigeria MNP Go-to-market strategies 4 RETAIN 3 CAPTURE Post MNP 1 PROTECT 2 ENTICE Pre MNP Existing Customers New Customers DEFENSIVE STRATEGY OFFENSIVE STRATEGY 61
Slide 62: Mobile Number Portability: MTN's strategic thrust
Mobile Number Portability: MTN’s strategic thrust • MNP is minimal in a highly multisimming • Position MTN as the ultimate market, as customers can maximize the best porting destination, building offers per operator. on the established market credentials and positive brand equity • MNP has had limit
Slide 63: MTN has just launched the most impactful MNP campaign
MTN has just launched the most impactful MNP campaign: creating sufficient shielding effect and positive brand affinity • Over 120,000 Brilliant, ingenious, Disruptive, WoW 42 unpaid views on Biggest coup in Marketing 88 YouTube! There is so much to Saka with the dance steps 4 I don’t like MTN, but
Slide 64: Disproportionate reduction in MTR by 40.2%
Disproportionate reduction in MTR by 40.2% vs 25.5% in Dec 2009, with low-to-medium risk of value erosion Sep '06 Dec '09 Dec '10 Dec '11 Dec '12 Apr '13 Apr ‘14 Apr ‘15 Established MNO 11.00 8.20 8.20 8.20 8.20 4.90 4.40 3.90 New and Small operators 10.20 9.80 9.00 8.20 6.90 5.20 3.90 MTN ERM 35.04
Slide 65: 2013 Strategic initiatives
2013 Strategic initiatives 65
Slide 66: 2013 Marketing Goals & High Level Execution Strategy
2013 Marketing Goals & High Level Execution Strategy 2013 Goals & Objectives Deliver 7.0m net adds Recapture market share in urban/city areas – particularly Lagos – by improving capacity and QoS and developing compelling propositions for HV customers Develop regional market approach to customise pro
Slide 67: Aggressive data growth
Aggressive data growth 67
Slide 68: Data Revenue Vs. Total Revenue
Data Revenue Vs. Total Revenue Tot Data user: 19.7m Tot Data user: 22.8m 3G Data users: 4.0m 3G Data users: 4.3m 2G Data users: 15.7m 2G Data users: 18.6m 25 000 Data Revenue ( N'million) Avg. Usage/user: 46.75mb Avg. Usage/user: 56.51mb 14% Millions Tot Data user: 17.3m 3G Data users: 2.7m 21 540 D
Slide 69: Data Users Vs. Average Usage (MB)
Data Users Vs. Average Usage (MB) 25 60 56.51 49.13 48.17 20 Data Users: 46.75 50 Q42011: 12.82M 40.41 Q42012: 19.73M 40 Millions 15 30 24.17 22.81 10 19.73 17.31 20 15.97 16.14 13.62 14.30 12.78 5 12.82 10 9.02 8.70 9.15 - 0 Q111 Q211 Q311 Q411 Q112 Q212 Q312 Q412 Q113 Data users Average Usage (mb)
Slide 70: High Growth potential of Smartphones
High Growth potential of Smartphones: Growing subscriber base and ARPU Smartphone Vs. Non-Smartphone Smartphone 9% 54% increase in smartphone customers between Q112 and Q113 2G GPRS 57% 34% Subscriber Base by Phone Smartphone users’ ARPU is a reflection of the expanded services and contents that the
Slide 71: Data Users: 3G customers per operator
Data Users : 3G customers per operator 71
Slide 72: VAS/Data and Product Development
VAS/Data and Product Development 72
Slide 73: Data Growth Initiatives
Data Growth Initiatives Above-The-Line Campaigns • Data Bonus Offers : Up to 160% Data Bonus for 100MB data subscription and above • Data Bundle Plans featuring Rollover & Gifting : Rollover unused data to the next month subscription • Data / Device Bundled Offers : Freebies bundled with data device
Slide 74: MTN SDP Service Delivery Platform
MTN SDP Service Delivery Platform The Service Delivery Platform provides service creation, service deployment and administration services. Introduced in Q4 2012, MTN Nigeria has commercialised 7 key 3rd party content services on the SDP Effective (fast and efficient) support for development and de
Slide 75: MTN Zone
MTN Zone Pricing minutes innovatively based on location RGS 30 (Million) New Subscribers RGS 90 (Million) Oct Nov Dec Jan Feb Mar Oct Nov Dec Jan Feb Mar 2012 2012 2012 ‘13 ‘13 ‘13 2012 2012 2012 ‘13 ‘13 ‘13
Slide 76: Churn/Dormancy Management
Churn/Dormancy Management 76
Slide 77: MTN Churn vs. Average Industry churn
MTN Churn vs. Average Industry churn : MTN maintained churn that is significantly below industry- wide average MTN Industry Mar '12 Apr '12 May '12 June '12 July'12 Aug'12 Sept'12 Oct'12 Nov'12 Dec '12 Jan13 Feb '13 Mar '13 77
Slide 78: Mobile Money Agent Banking
Mobile Money Agent Banking 78
Slide 79: Mobile Money Update – CBN Engagement
Mobile Money Update – CBN Engagement • Registration to new customers on the Mobile Money platform was suspended in December 2012. • We have had series of engagement with both the regulatory authority (CBN) and our existing partners. • From our engagement, the key concerns of the CBN were; 1. MTN bra
Slide 80: Subscriber Performance
Subscriber Performance • In Sept 2012, there was a trade launch across key cities. In addition to ATL/CLM/and BTL activities • This accounts for the spike in figures across all activities from the month of September. • Growth in MM Subscriber numbers by 212% post launch between September and Decembe
Slide 81: Driving Leadership at the Point of Sale
DRIVING LEADERSHIP AT THE POINT OF SALE
Slide 82: Our Structure / Strategy / Performance
• Our Structure • Our Strategy • Our Performance • Our Readiness • Our Priorities 82
Slide 83: Sales & Distribution Structure
Sales & Distribution Structure Sales & Distribution Executive Business Sales Logistics & Sales Support & Development Distribution Financial Control Explore growth opportunities In field Ensure end-to- Trade partner execution end distribution account set-up Alignment with of all products an
Slide 84: Three Regions
Three Regions North Region Sokoto Katsina Jigawa Yobe Zamfara Kano Kebbi Borno Kaduna Bauchi Gombe Niger Adamawa Federal Plateau capital Kwara territory Nassarawa Lagos/Southw Oyo Taraba est Region Osun Ekiti Kogi Benue Ogun Ondo Enugu Lagos Edo Ana- Ebonyi mbra Cross Abia Imo river Delta East River
Slide 85: Eight Sub-Regions
Eight Sub- Regions North North North West Central East Sokoto Kaduna Katsina Yob Jigawa Niger e Zamfara Borno Kano Kebbi Federal capital Nassarawa territory Bauchi Gombe Kogi Adamawa Sokoto Plateau South Katsina Jigawa x Yobe Taraba Zamfara West Kebbi Kano Borno Kaduna Bauchi Kwara Gombe Niger Oyo A
Slide 86: Trade Partners, B2Bs and Service Centres
Trade Partners,B2Bs and Service Centres 2 1 1 2 1 1 3 3 2 2 3 2 2 3 4 2 2 1 4 3 2 3 3 4 5 3 4 19 5 1 4 4 5 Trade Partners=120 5 B2B=21 1 Central warehouse =1 3 4 Service Centres=16 86
Slide 87: Route to Market
Route to Market MTN Indirect Direct Traditiona Non Service Connect Connect l Traditional Centre stores points Convenience MM Sim Reg Data Trade channel Super Agencie Trade Partners members Agents s partners Sub New TP Outbound DSA trade Dawn Sales partners MM Bizlift Retail members Agent End Users 8
Slide 88: Our Structure / Strategy / Performance
• Our Structure • Our Strategy • Our Performance • Our Readiness • Our Priorities 88
Slide 89: Sales & Distribution Strategy
Sales & Distribution Strategy To drive sustainable growth through execution excellence, superior customer Experience and expanded distribution coverage Customer New Growth Processes & Visibility Data & Devices Engagement Opportunities Systems Experience Experience Growth Growth Optimizing Drive rapi
Slide 90: Strategy Pillar
Strategy Pillar To drive sustainable growth through execution excellence, superior customer experience and expanded distribution coverage Customer Engagement 1 Customer Acquisition Experience 2 Winning at Retail Manage Raise the 3 Outlet Classification regulatory barrier to uncertainti entry for es
Slide 91: Customer Engagement
Customer Engagement • 363 Walk In Centres (17 Service Centers, 256 Connect Locations, 90 New Dawn shops) • 2,500 Mobile Sim Registration and Activation Agents providing increased subscriber foot prints. MTN PARTNER NEW DAWN SHOP RETAIL OUTLET_MTN KIOSK • 600 Trade Partner Outbound Sales Teams drivin
Slide 92: Customer Engagement
Customer Engagement • 10,700 SIM Registration Boxes and Tablet Devices fully optimised and utilised. • 10 Specialised SIM Reg. and Activation Agencies driving increased subscriber acquisition. Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 • Trade commission skewed to Gross Additions Set Target en
Slide 93: Customer Engagement
Customer Engagement 600 000 500 000 400 000 • Direct To Retail Field force of over 300 000 5,475 200 000 480 000 340 000 • Weekly coverage of over 300,000 100 000 120 000 retail outlets 0 2011 2012 2013 • Effective coverage of 120 Trade Growing the retail base Partner exclusive retail blocks • Impro
Slide 94: Strategy Pillar
Strategy Pillar To drive sustainable growth through execution excellence, superior customer Experience and expanded distribution coverage Visibility VISIBILITY Experience Experience 1 VISA 3000 Raise the barrier Manage to entry for 2 Merchandising Strategy competition in Look and Feel regulatory the
Slide 95: Visibility
Visibility Retail outlets segmentation Innovative merchandising solutions Standardised PoS communication using the merchandising manual Engagement with regulatory bodies VISA 3000 • Strong brand visibility • Retailer ownership • Customer convenience 95
Slide 96: Strategy Pillar
Strategy Pillar To drive sustainable growth through execution excellence, superior customer experience and expanded distribution coverage Data & Devices Experience Experience Growth DATA & DEVICES Raise the barrier Manage to entry for 1 Channel Strategy competition in regulatory Look and Feel of Dri
Slide 97: Data and Devices
Data and Devices Device Trade Channel strategy 1 2 3 4 5 Walk in Direct Sales Independent MTN Partners OEMs Centres Agents Resellers • Provision of shop • Own & 3rd party • Sales team • Partnership with • Partnership with fronts for device Walk In Centres & focused on OEMs to drive data structured d
Slide 98: Data and Devices
Data and Devices New Dawn Shops • 90 shops operational • One stop shop for customer service & sales Handsets USB modems 3G routers Engagement with 5 OEM • Nokia, Samsung, Techno, ZTE, Netbooks/Tablets C3 - U900 Huawei 00 • Monthly engagement schedule Cha P500 G66 mp 00 • Free Sims for OEMs • Deploym
Slide 99: Data and Devices
Data and Devices Total 3G devices on the network Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 SC Device Contribution Per Definition Device Type Contribution 8% TP – Trade Partner DONGLE Channel SC – Service Centers 28% CS CS – Connect Store
Slide 100: Strategy Pillar
Strategy Pillar To drive sustainable growth through execution excellence, superior customer experience and expanded distribution coverage New Growth Opportunities Experience Experience Growth Growth Optimizing NEW GROWTH OPPORTUNITIES Raise the barrier Drive rapid Consumer Data 1Manage to entry for
Slide 101: New Growth Opportunities
New Growth Opportunities • Engagement with high Retail Chains, Malls, Parks and HoReCa • Already signed on: - TransferTo, - Tranglo - Ezetop 101
Slide 102: New Growth Opportunities
New Growth Opportunities PROJECT S.W.A.G SEMI-URBAN: WIN AND GROW 102
Slide 103: Strategy Pillar
Strategy Pillar To drive sustainable growth through execution excellence, superior customer experience and expanded distribution coverage Processes & Systems PROCESSES Experience & SYSTEMS Experience Growth Growth Optimising Drive rapid 1 Cost structure Raise the barrier Consumer Data Doing more Man
Slide 104: Processes and Systems (Cost Structure)
Processes and Systems ( Cost Structure) Our cost structure entails the following.. • Distribution cost (CWH) - General logistics operations. • Trade discounts, commissions & bonuses • Upfront discounts (Airtime vouchers & data devices) • Backend commissions and bonuses (ORSC, gross connection & new
Slide 105: Processes and Systems
Processes and Systems Field Force Management Automated Sales Process Visibility of in field execution Trade Partner Portal One-stop dealer management application Integration with the customer relationship management (CRM) application 105
Slide 106: Our Structure / Strategy / Performance
• Our Structure • Our Strategy • Our Performance • Our Readiness • Our Priorities 106
Slide 107: Logical Contribution still above target
Logical Contribution still above target 24% 22% ▪ EVD contribution to Total Airtime Sales is 76% in the 2012 ▪ Contribution to Total Airtime Sales: Physical -24%, 76% 78% Logical – 74%, VTU – 4% ▪ 2% growth in YTD EVD vs. 2012 (EVD: 76%) 2012 Q1 '13 EVD Physical 107
Slide 108: Our Structure / Strategy / Performance
• Our Structure • Our Strategy • Our Performance • Our Readiness • Our Priorities 108
Slide 109: Engine Room
Engine Room ER MANCOM • All Executives National Engine • Cross-functional HQ GM team Room • Regional ER leaders SMs Region South Region North Region West (HRE/CESO) East (CTO/CFO/CRE) (CIO/BRM/CSE) Lagos Lagos 3 NE + NW NC East 1 East 2 1+ 2 Cross-functional regional teams with “execution teams” on
Slide 110: Our Structure / Strategy / Performance
• Our Structure • Our Strategy • Our Performance • Our Readiness • Our Priorities 110
Slide 111: 2013 Top Priorities
2013 Top Priorities Proactively drive the sales of devices, focusing on new & existing distribution channels Point of Sales dominance through our Winning at Retail initiative and Trade Marketing capabilities Use SIM registration as tool for competitive advantage Achieve the Look and Feel of a market
Slide 112: The Experience
• The Experience 112
Slide 113: Trade Partners Branded Outbound sales Van
Trade Partners Branded Outbound sales Van • To harness full market potential in their trading territories • Agreed route plans • Provides both sales and services 113
Slide 114: Service Centers on Wheels – Mobile Lite
Service Centers on Wheels – 8 Mobile Lite across the Sub regions • Make products and services available and accessible to customers in the most convenient way • Focus on echarge and data/VAS 114
Slide 115: New Dawn Shop – setting the pace in data experience
New Dawn Shop – setting the pace in data experience 115
Slide 116: Id-El Maulud Activation
Utilizing every opportunity to drive gross connection: Id-El Maulud Activation 116
Slide 117: Valentine Activations – Oshogbo
Utilising every opportunity to drive gross connections: Valentine Activations – Oshogbo (Osun 1) 117
Slide 118: MTN Zone Migration @ Ezi & Ubulu market in Delta
MTN Zone Migration @ Ezi & Ubulu market in Delta 118
Slide 119: New experiences for rural dwellers
New experiences for rural dwellers 119
Slide 120: The Solid Y'ello
The Solid Y’ello 120
Slide 121: Appendix
APPENDIX 121
Slide 122: Business Development Administrator
Business Development Administrator Business Trade Development Sales Channels Communications Channel Administrator Wholesale Retail Trade Project Merchandizing Support & Data Electronics Mobile CAC Channel Channel Comm Channel Channel Money Channel Analyst Analyst Analyst Analyst Analyst Analyst Anal
Slide 123: The Sales Team
The Sales Team General Manager, Sales Senior Senior Senior Manager, Manager, Manager, Sales - West Sales - East Sales - North RSMs RTMMs RSMs RTMMs RSMs RTMMs DAEs TMCs DAEs TMCs DAEs TMCs 123
Slide 124: MTN Nigeria Business – Enterprise Solutions
MTN Nigeria Business – Enterprise Solutions May 2013
Slide 125: External Drivers - Nigeria ICT market players
External Drivers - Nigeria ICT market players In general, the ICT market is served by several players with no clear market dominance ICT Nigeria – 2013 “Hybrid” Telecom Players IT players Players MNC/Wholessale TELNET Government Corporate SMEs SOHO/Residential • Risk of Churn/Commoditization (excess
Slide 126: MTNN Expanding the service offering
MTNN Expanding the service offering Managed network, managed convergent and managed IT services are heavily demanded and represent the biggest opportunity. Standard offers only Limited Customized Customized offers only DP support 1 Fixed voice/broadband Mobile Mobile Backbone connectivity Managed co
Slide 127: Data & ICT Services Portfolio
Data & ICT Services Portfolio Managed WAN (Phase 1) - web Managed WAN (Phase 2) - Network based service monitoring platform extension of web based monitoring to corporate customer for KPI platform to all customer nodes for Services management & service troubleshooting and fault escalation enhancemen
Slide 128: SME Segment Product Mix (MTN MyOffice)
SME Segment Product Mix( MTN MyOffice) Convergent Convergent Network Services Network Services services services •Fixed wireless •Fixed Voice •DaaS •Domain Name broadband •Mobile Voice •BaaS •Webhosting internet (Wimax) •SME CUG • M2M- Transport •Webpage •Fixed wireline, •Smart phone & and Logistic
Slide 129: Key Focus Areas for 2013
Key Focus Areas for 2013 • Drive revenue through customised Data & ICT solutions to address specific vertical industry opportunities • Increase Market and Value share: • Aggressive Sales drive into Major Corporates focusing on Cross-selling and Upselling opportunity with expanded service offering •
Slide 130: Key messages
Key messages • Operating in a fragmented space but aim to achieve market leadership • Expanded ICT service offering strategy into the business market is working • Focusing on key verticals to drive revenue and market share • Positioning the MTN Business brand as the leading ICT provider 130
Slide 131: MTN Business – ICT Leader
MTN Business — ICT Leader The Clear-cut Leader i in Business ICT Solutions. MIM Buuinet Ras changed the busness solutions landscape for thw Better, skways raising th bay in Business innovation, And tha is just the beginesng MTN Business. Think Transformation. MIN Business Ciz> Conewcnety | Commerica
Slide 132: MTN XaaS: MFB SaaS
MTN XaaS: MFB SaaS <i> If 2 out of 3 microfinance banks worldwide are choosing Software-as-a-Service Xaas MICROFINANCE SOFTWARE SOLUTIONS O shouldn’t you be? MTN XaaS Micro-Banking Software as a Service Imagine being able to deter baring anywhere without the constraints ofnfrastructuew ownership nd
Slide 133: Sample Advertising Material
Sample Advertising Material 133
Slide 134: Sample Advertising Material
Sample Advertising Material 134
Slide 135: Sample Advertising Material
Sample Advertising Material 135
Slide 136: Sample Advertising Material
Sample Advertising Material 136
Slide 137: Sample Advertising Material
Sample Advertising Material 137
Slide 138: NWG Analysts Presentation May 2013
NWG Analysts Presentation May 2013
Slide 139: MTN Network Evolution 2008 – 2012
MTN Network Evolution 2008 – 2012 Challenges Innovation What the future holds?
Slide 140: MTNN Access Technology evolution
MTNN Access Technology evolution From 2008-2012, the 2008 2009 2010 2011 2012 MTNN Network evolved HSPA+ through the introduction of HSPA new access technologies UMTS for mobile networks GPRS GSM Within same period, MTNN MTNN Capacity evolution and Utilization grew capacity by 255% to (EoY) capture
Slide 141: Network Modernization: Network Element Evolution
NETWORK Network Element Evolution MODERNIZATION Evolution of the network RRU/ UniRAN is critical to ensure new Infrastructure HYBRID POWER SYSTEMS access technologies OUTDOOR SITE INDOOR SITE An important driver is WIFI how the customers will METRO ETHERNET interact with the Transport IPRAN network
Slide 142: Congestion & Call Drop
Pressure on MTNN revenue due to price war triggered by the competition, MTNN embarked on the “5 Star” Promo in Q3, 2012. Key effect was traffic in excess of available capacity and in turn degradation of Quality of Service. Jan'11 May'11 May'12 Dec'12 Apr'11 Dec'11 Apr'12 Mar'11 Aug'11 Jan'12 Aug'12
Slide 143: Operational environment challenges in Nigeria
In addition to commercial challenges, the environment presents a number of challenges , a Thisday Newspaper publication of Mar 3, 2013 reads; “In fairness to the operators, there are a number of operational challenges, many of them unique to Nigeria, that have direct adverse impact on the overall qu
Slide 144: Power
250 POWER MTNN: 200 • Generates over 120 MVA of Power from Diesel Generators from BTS sites only 150 • Replaces generators every 12,000 hours (a Polulation (m) year and half) 100 Electricity (GW) • Consumes approximately 6.4m litres of AGO 50 Monthly 0 NATURAL DISASTERS Nigeria South Brazil • Floodi
Slide 145: Marked improvement in network performance indicators
Highlight: Marked improvement in Network performance indicators through Q3 ‘12 to Q1 ’13 All KPIs have remained above the NCC target throughout the year* KPI SCORE (Normalized) NCC KPI SEP'12 OCT'12 NOV'12 JAN'13 FEB'13 MAR'13 SDCCH_CONG 3.62 4.41 1.68 1.00 1.05 0.86 TCH_CONG 5.99 5.90 3.26 2.14
Slide 146: Core Network
CORE NETWORK I. Pooling of Core Nodes for additional control layer switching, efficient capacity utilisation, optimal loading and traffic distribution • MSC-BC • SGSN II. AoIP and IuoIP Implementation for improved capacity management between MSC and BSC/RNC layer III. Direct Gy Implementation for en
Slide 147: Transport
TRANSPORT I. Multiservice Metro providing transmission capacity for both TDM and Packet traffic in the metropolitan areas (20 Cities) II. Lambda Upgrades increasing transmission capacity on the optical backbone III. NGN Synchronization- Expansion of the synchronisation network in line with the growt
Slide 148: How do we continue to compete and deliver on our promise
How do we continue to compete and deliver on our promise to our valued customer? Lower Operating Costs Hybrid energy systems Increase infrastructure sharing (co-location) Continue to drive innovation with partners to reduce equipment footprint, cooling and power requirements Efficiency and s