Turkcell Iletisim Hizmetleri A.s. · BIST:TCELL
Turkcell Iletisim Hizmetleri A.s — Turkcell — Q1 2017 Earnings Presentation
28 slides from Turkcell Iletisim Hizmetleri A.s's earnings presentation, Apr 26, 2017
Slide 1: Turkcell Group Q1 2017
TURKCELL GROUP Q1 2017 April 26, 2017 1
Slide 2: Business Overview
BUSINESS OVERVIEW Kaan Terzioğlu Turkcell CEO 2
Slide 3: Delivering on Our Strategy
Turkcell | First Quarter 2017 TURKCELL GROUP DELIVERING ON OUR STRATEGY GSM 3G DIGITAL SERVICES 4.5G 2G Fiber COMPANY 3 WITH GLOBAL BRANDS
Slide 4: First Quarter Highlights
Turkcell | First Quarter 2017 TURKCELL GROUP FIRST QUARTER HIGHLIGHTS FINANCIAL OPERATIONAL Record growth of top-line and EBITDA Success story of 4.5G in its 1st year Highest Q1 EBITDA margin since 2009 Mobile multi-play offers doubled yoy 94% data and digital services growth ~53 mn core digital ser
Slide 5: Financial Highlights
Turkcell | First Quarter 2017 TURKCELL GROUP FINANCIAL HIGHLIGHTS GROUP SHARE OF REVENUES Consolidated Q1 2016 Q1 2017 Growth YoY % TRY Million1 Revenue 3,225 4,053 25.6% 6% 6% EBITDA 1,002 1,400 39.8% EBITDA Margin 31.1% 34.5% 3.4pp Net Income 563 459 (18.5%) Op.Capex/Sales2 88% 21% 13% (7.8pp) • R
Slide 6: Financial Highlights: Turkey
Turkcell | First Quarter 2017 TURKCELL GROUP FINANCIAL HIGHLIGHTS TURKEY TRY Million1 Q1 2016 Q1 2017 Growth YoY % Revenue 2,928 3,563 21.7% EBITDA 916 1,269 38.5% EBITDA Margin 31.3% 35.6% 4.3pp Net Income 536 454 (15.3%) • Turkcell Turkey revenue growth including financial services is 25.4% in Q11
Slide 7: Operational Highlights: Turkey
Turkcell | First Quarter 2017 TURKCELL TURKEY OPERATIONAL HIGHLIGHTS SUBSCRIBER ARPU (TL) YoY Turkcell Turkey 51.3 51.6 51.1 53.1 25% Ukraine 47.1 50.3 5.6% Total 3% Belarus YoY 29.5 30.9 30.5 50.4 mn 1% Northern Cyprus 23.7 26.0 27.1 17.3% Turkcell Europe 70% 1% Q115 Q116 Q216 Q316 Q416 Q117 Fixed
Slide 8: First Anniversary of 4.5G Launch
Turkcell | First Quarter 2017 TURKCELL TURKEY FIRST ANNIVERSARY OF 4.5G LAUNCH ~12mn MOBILE DATA USAGE (Av. GB/User) smartphones 4.6 4.3 4.3 4.3 with 4.5G 2.3 2.6 2.8 3.0 5.1GB 1.8 81 cities ~26 mn in March 83% subscribers pop. Q116 Q216 Q316 Q416 Q117 Total Users 4.5G Users coverage 26 SMARTPHONE 2
Slide 9: Positive Trend in Multiplay
Turkcell | First Quarter 2017 TURKCELL TURKEY POSITIVE TREND IN MULTIPLAY MOBILE* (TRIPLE PLAY) 41.8% 42.4% 28.2% 20.7% 24.0% FIBER RESIDENTIAL (MULTIPLAY WITH TV) 35.9% 38.7% 32.6% 33.9% 29.8% Q116 Q216 Q316 Q416 Q117 9 *Share of mobile voice users which excludes subscribers who do not use their li
Slide 10: TV Highlights
Turkcell | First Quarter 2017 TURKCELL TURKEY TV HIGHLIGHTS OTT TV* and IP TV (Thousand) 776 875 1.3 665 million 411 480 customers 268 303 323 360 402 Q116 Q216 Q316 Q416 Q117 IP TV & OTT TV customers OTT TV only customers • Turkcell TV+ is the leader in mobile and tablet with 4.5G experience • Enri
Slide 11: Consistent Growth in Core Digital Services
Turkcell | First Quarter 2017 TURKCELL GROUP CONSISTENT GROWTH IN CORE DIGITAL SERVICES PERSONAL CLOUD 12.9 M INSTANT MESSAGING (lifebox) 4.3 M 51.4 53.3 44.2 DIGITAL 9.1 M MUSIC PUBLISHING 1.3 M 26.1 MY 17.4 M ACCOUNT SPORTS 3.3 M Q116 Q416 Q117 Apr 17 MOBILE Total Core Services TURKCELL 2.9 M TURK
Slide 12: Growth Drivers
Turkcell | First Quarter 2017 TURKCELL TURKEY GROWTH DRIVERS 1,400 1,438 89% 40% 763 YoY MOBILE DATA TRY MILLION Q116 Q416 Q117 Data&Digital Services TRY 2.4 bn 240 289 317 32% 33% 94.2% YoY 9% FIXED DATA YoY TRY MILLION Q116 Q416 Q117 18% 537 631 180% DIGITAL SERVICES 226 YoY Mobile Data Fixed Data
Slide 13: New Services Underway
Turkcell | First Quarter 2017 TURKCELL GROUP NEW SERVICES UNDERWAY DIGITAL SERVICES FINANCIAL SERVICES ENERGY SERVICES • Smartphone penetration • Revenue stream • Revenue stream • Different value propositions • Cash flow management • Customer loyalty • Fintech apps; digital wallet, • New customers p
Slide 14: Energy Company
Turkcell | First Quarter 2017 TURKCELL GROUP ENERGY COMPANY Brand strength Customer Sales channel Customer Service Billing Big data Digital services Technology Energy Different value propositions (smart home, uninterrupted service, Telecom & battery wall) Digital services Consumer Customer loyalty F
Slide 15: Consumer Finance Company
Turkcell | First Quarter 2017 OTHER BUSINESSES CONSUMER FINANCE COMPANY COMMENCED OPERATIONS IN MARCH 2016 Improve working capital management Securitization of receivables (1st ABS issued) Fitch Ratings Support smartphone penetration growth AA local/Currency Fintech applications TRY FINANCIAL KPIs 5
Slide 16: Turkcell International
Turkcell | First Quarter 2017 TURKCELL GROUP TURKCELL INTERNATIONAL HIGHLIGHTS lifecell Leader 24.3% 27.1% in 3G coverage TRY MILLION1 Q1 17 YoY Growth BeST* Digital Revenue 248 26.0% 50.6% 7.5% services focus EBITDA 60 12.7% Kuzey Kıbrıs Turkcell EBITDA Margin 24.3% (2.9pp) 4K «lifecell» 12.0% 36.0
Slide 17: Financial Overview
FINANCIAL OVERVIEW Bülent Aksu Turkcell CFO 17
Slide 18: Revenue & EBITDA
Turkcell | First Quarter 2017 TURKCELL GROUP REVENUE & EBITDA REVENUE EBITDA TRY MILLION TRY MILLION 4,053 114 28 (424) 51 827 1,400 635 (21) 17 3,225 1,002 25.6% Margin 31.1% 39.8% Margin 34.5% Revenue Δ Turkcell Δ Turkcell ΔTCF* Δ Other Revenue EBITDA Δ in Δ in Direct Δ in G&A Δ in S&M EBITDA Q116
Slide 19: Net Income Development
Turkcell | First Quarter 2017 TURKCELL GROUP NET INCOME DEVELOPMENT TRY MILLION 4.5G investments (174) 398 (211) (15) (102) 13 563 (14) 459 Net income Q116 Δ in EBITDA Δ in D&A Δ in Interest Δ in Fintur Δ in FX Δ in Other Δ in Taxation Net income Q117 Inc./Exp. Gain/Loss* Inc/Exp. 19 *FX/Gain loss i
Slide 20: Solid Balance Sheet
Turkcell | First Quarter 2017 TURKCELL GROUP SOLID BALANCE SHEET SUMMARY NET DEBT/ EBITDA 3 TRY MILLION Q1 2016 Q4 2016 Q1 2017 «investment 0.8x 0.9x grade» Total Cash 2,522 6,052 6,451 4,280 0.6x 3,729 Total Assets 26,175 31,600 32,955 2,485 Total Debt 4,028 9,781 10,730 Total Equity 14,902 16,068
Slide 21: Cash Development
Turkcell | First Quarter 2017 TURKCELL GROUP CASH DEVELOPMENT Decrease in trade payables (698) Increase in trade receivables (277) Prepaid subscriber frequecy usage fee (309) Change in other working capital items 293 (571) 11 550 (991) 1,400 6,052 6,451 Q416 EBITDA Capex* Net int Net chg in Other Q1
Slide 22: FX Exposure
Turkcell | First Quarter 2017 TURKCELL GROUP FX EXPOSURE CASH DEBT NET FX POSITION* (million USD) Before Hedging After Hedging Q115 Q116 Q216 Q316 Q416 Q117 (125) (91) (217) (688) Share 31% 28% (1,239) 45% 55% 69% 72% (1,987) FX position ~70% minimized Nominal 6.5 Bn TL 10.7 Bn TL FX Local Currency
Slide 23: Notice
Turkcell | First Quarter 2017 NOTICE This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995.
Slide 24: Thank You
THANK YOU For further information please e-mail investor.relations@turkcell.com.tr or call Turkcell Investor Relations at (+90 212 313 1888) Have you updated Turkcell IR app? For Android For iOS 24
Slide 25: Appendix
APPENDIX 25
Slide 26: Summary Income Statement As Per CMB Financials
Summary Income Statement As Per CMB1 Financials (TRY MILLION) Summary income statement Q1 2016 Q4 2016 Q1 2017 YoY (%) QoQ (%) Revenue 3,225 4,044 4,053 26% 0% Direct Cost of Revenues2 (2,019) (2,608) (2,617) 30% 0% S&M (481) (479) (465) (3%) (3%) G&A (179) (190) (200) 12% 5% EBITDA 1,002 1,371 1,40
Slide 27: Consolidated Balance Sheet
Consolidated Balance Sheet (TRY MILLION) Consolidated Balance Sheet (TRY mn) 1Q 2016 4Q 2016 1Q 2017 YoY(%) QoQ(%) Cash & Bank 2,522 6,052 6,451 156% 7% CURRENT ASSETS 8,645 13,351 14,720 70% 10% TOTAL NON-CURRENT ASSETS 17,530 18,249 18,235 4% (0.1%) TOTAL ASSETS 26,175 31,600 32,955 26% 4% S/T Deb
Slide 28: Currency Trends
Currency Trends Average Period-End USD / TRY 3.52 3.64 EUR / TRY 2.91 3.71 3.91 2.32 3.67 2.82 3.18 2.73 3.01 3.32 3.90 2.90 3.02 2.19 2014 2015 2016 1Q17 2014 2015 2016 1Q17 USD / BYN USD / UAH 24.00 27.19 26.98 1.86 1.96 1.87 15.77 0.95 1.19 25.56 27.09 1.98 1.91 21.79 0.89 1.03 1.59 11.87 2013 20