Telekom Austria Ag · VIE:TKA

Telekom Austria — A1 Telekom Austria Group — Q1 2020 Earnings Presentation

36 slides from Telekom Austria's earnings presentation, Apr 28, 2020

  1. Slide 1: Results for the first quarter 2020

    Results for the first quarter 2020 April 28, 2020, Vienna

  2. Slide 2: Cautionary statement

    Cautionary statement 'This presentation contains forward-looking statements. These forward-looking statements are usually accompanied by words such as 'believe', 'intend', 'anticipate', 'plan', 'expect' and similar expressions. Actual events may differ materially from those anticipated in these forw

  3. Slide 3: A1 Telekom Austria Group key facts

    A1 Telekom Austria Group key facts Revenues by segment(a) Bulgaria 10,5% Austria 57,5% 9,4% Croatia 9,2% Belarus 4,5% 6,2% Slovenia 2,7% North Macedonia Serbia EBITDA by segment(a) 11,1% Bulgaria Austria 56,8% 8,9% Croatia 11,8% Belarus 3,6% Slovenia 2,7% 5,1% North Macedonia Serbia Notes: (a) For F

  4. Slide 4: The leading regional communications player providing convergent telecommunication services

    The leading regional communications player providing convergent telecommunication services as of March 31, 2020 (in ‘000) Austria Bulgaria Croatia Mobile market position #1 Mobile market position: #1 Mobile market position #2 Mobile subscribers: Mobile subscribers: Mobile subscribers:  5,052 (Q1 20

  5. Slide 5: Shareholder structure as of December 31, 2019

    Shareholder structure as of December 31, 2019 Two strong core shareholders Freefloat by nationality Rest of World Switzerland Employee Rest of Europe 1.6% 0.5% Stocks/Treasury 1.2% Shares 0.8% Free Float United Kingdom 2.7% 20.58% United States Unidentified 34.8% 3.4% Nordics 5.1% América Movil 51.0

  6. Slide 6: 2013-2019: Balance sheet structure significantly improved

    2013-2019: Balance sheet structure significantly improved Debt ratio sharply Equity ratio Rating improved reduced significantly increased Net Debt / EBITDA (pre IFRS 16) Reimbursement Baa1/BBB+ 3.4 of hybrid bond 0.5 2.6 2.2 2.1 2.0 34.9 38.5 32.6 31.2 Baa2/BBB 0.5 2.0 1.8 26.7 29.2 (positive outloo

  7. Slide 7: Operational and financial highlights for the first quarter 2020

    Operational and financial highlights for the first quarter 2020

  8. Slide 8: Highlights Q1 2020

    Highlights Q1 2020  Group total revenue growth of 3.4% and EBITDA excl. restructuring growth of 0.4% (reported: +1.7%), both driven by CEE  Mobile contract customer base increase of 5.0% y-o-y with growing or stable numbers in all markets  RGU decrease of 0.9% y-o-y, TV RGU growth mitigated the d

  9. Slide 9: Positive trends of the last quarters continued in Q1 2020, while Covid-19 showed some first negative impacts

    Positive trends of the last quarters continued in Q1 2020, while Covid-19 showed some first negative impacts Group (in EUR million) Q1 2020 Q1 2019 % change Total revenues 1,126.0 1,089.5 3.4% Service revenues 949.8 924.4 2.7% EBITDA excl. restructuring* 396.6 395.0 0.4% CAPEX 176.2 157.9 11.6%  Gr

  10. Slide 10: Growth entirely driven by CEE markets in Q1 2020

    Growth entirely driven by CEE markets in Q1 2020 Total revenues Service Revenues EBITDA excl. restructuring (in EUR mn) (in EUR mn) (in EUR mn) 32.3 1,126.0 1,089.5 0.8 949.8 22.4 924.4 0.4 +3.4% 395.0 -7.6 10.5 396.6 +2,7% +0.4% Revenues Austria International Revenues Service Austria International

  11. Slide 11: Austria: Lower fixed-line and roaming revenues; higher bad debt and costs related to commercial 5G launch

    Austria: Lower fixed-line and roaming revenues; higher bad debt and costs related to commercial 5G launch weighed on EBITDA Operational data ARPU ARPL (in EUR) (in EUR)  +1.9% contract subscribers which continued to be driven by ongoing Δ: +2.7% strong demand for mobile WiFi routers and high-value

  12. Slide 12: CEE: Service revenue growth continued in most of the markets

    CEE: Service revenue growth continued in most of the markets and overall led to strong EBITDA growth Highlights CEE EBITDA Bulgaria: (in EUR mn; Q1 %-change vs. PY)  Ongoing strong service revenue growth (+10.3%):  Fixed-line continued to be driven by customized corporate solutions, upselling and

  13. Slide 13: Q1 2020: Free cash flow increased, mainly driven by lower working capital

    Q1 2020: Free cash flow increased, mainly driven by lower working capital  Free cash flow EUR 70.3 mn higher in Q1 2020 vs.  Changes in financial positions: EUR +11.6 mn prior year, driven by (EUR -53.0 mn in Q1 2019), mainly driven by:  … higher operating cashflow following lower  EUR +25.6 mn

  14. Slide 14: Focus Points

    Telekom Austria

  15. Slide 15: New platform A1 Xplore TV with enhanced features launched in Austria in Q1 2020

    New platform A1 Xplore TV with enhanced features launched in Austria in Q1 2020 S M L EUR 7,90/ EUR 11,90/ EUR 29,90/ Most comprehensive TV Month Month Month product on the market Channels 60 140 180 260 channels The new platform comes with a stronger proposition Replay Restart 7 days 7 days 7 days

  16. Slide 16: Immediate effects of Covid-19 lockdown measures on A1 Group

    Immediate effects of Covid-19 lockdown measures on A1 Group Network Demand Supply chain Organization Stable Strong Stable Stable business, WiFi routers, with initial traffic increase* We were able to maintain Highest priority is health broadband speed upgrades • Voice up 60% a working supply chain N

  17. Slide 17: Mid-term impacts of Covid-19 on key financials and KPIs

    Mid-term impacts of Covid-19 on key financials and KPIs • Traffic declined by up to 80% • EUR 1bn open credit line Roaming Liquidity yoy after Covid-19 outbreak facility (maturity: 2024) Material impact • Exposure especially in tourism Ensured • 1st bond repayment in countries (Austria, Croatia) Dec

  18. Slide 18: Outlook for the full year 2020

    Outlook for the full year 2020

  19. Slide 19: A1 Telekom Austria Group suspends outlook 2020 due to limited visibility of Covid-19 impacts

    A1 Telekom Austria Group suspends outlook 2020 due to limited visibility of Covid-19 impacts on full year results  As it is still premature to give a precise estimation on the impact of the Covid-19 crisis, in particular concerning the full impact on the economy, we are suspending our outlook.  Up

  20. Slide 20: Appendix

    Appendix 1 All figures are stated according to IFRS 16 on a reported basis

  21. Slide 21: The leading regional communications player providing convergent telecommunication services

    The leading regional communications player providing convergent telecommunication services as of March 31, 2020 (in ‘000) Austria Bulgaria Croatia Mobile market position #1 Mobile market position: #1 Mobile market position #2 Mobile subscribers: Mobile subscribers: Mobile subscribers:  5,052 (Q1 20

  22. Slide 22: A1 Telekom Austria Group – Profit and Loss

    A1 Telekom Austria Group – Profit and Loss (in EUR million) Q1 2020 Q1 2019 % change Service Revenues 949,8 924,4 2,7% Equipment Revenues 158,0 143,5 10,1% Other operating income 18,2 21,5 -15,5% Total Revenues 1.126,0 1.089,5 3,4% Cost of Service -326,8 -316,2 -3,4% Cost of Equipment -154,3 -142,8

  23. Slide 23: Total revenues & costs and expenses per segment

    A1 Telekom Austria Group – Total revenues & costs and expenses per segment A1 Telekom Austria Group - Total Revenue Split Total Revenues (in EUR million) Q1 2020 Q1 2019 % change Austria 647,5 646,8 0,1% Bulgaria 127,6 111,1 14,8% Croatia 101,2 102,1 -0,9% Belarus 109,6 93,8 16,8% Slovenia 48,6 51,2

  24. Slide 24: A1 Telekom Austria Group – workforce development

    A1 Telekom Austria Group – workforce development FTE (Average Period) Q1 2020 Q1 2019 % change Austria 7.584 7.960 -4,7% International 10.354 10.354 0,0% Corporate 378 380 -0,5% A1 Telekom Austria Group 18.317 18.695 -2,0% FTE (End of Period) Q1 2020 Q1 2019 % change Austria 7.573 7.961 -4,9% Intern

  25. Slide 25: A1 Telekom Austria Group – Capital expenditure split

    A1 Telekom Austria Group – Capital expenditure split Capital Expenditures (in EUR million) Q1 2020 Q1 2019 % change Austria 130,1 109,0 19,4% Bulgaria 14,3 10,1 41,1% Croatia 14,1 24,7 -42,9% Belarus 8,5 6,7 26,7% Slovenia 2,3 2,2 4,6% Serbia 2,6 2,7 -5,6% North Macedonia 3,5 1,5 143,4% Corporate &

  26. Slide 26: A1 Telekom Austria Group – Net debt

    A1 Telekom Austria Group – Net debt as of March 31, 2020 Net Debt (excl. Leases) (in EUR million) 31 March 2020 31 December 2019 % change Long-term Debt 2,540.4 2,539.6 0.0% Short-term Debt 0.0 123.0 n.a. Cash and Cash Equivalents -116.9 -140.3 16.7% Net Debt (excl. Leases) of A1 Telekom Austria Gro

  27. Slide 27: A1 Telekom Austria Group – Financial debt maturity profile

    A1 Telekom Austria Group – Financial debt maturity profile as of March 31, 2020 748,3 747,7 745,3 299,2 0,0 0,0 0,0 2020 2021 2022 2023 2024 2025 2026  EUR 2,540.4 mn short- and long-term debt as of March 31, 2020  Average cost of debt of 2.95%  Cash and cash equivalents of EUR 116.9 mn  Average

  28. Slide 28: A1 Telekom Austria Group – Debt profile

    A1 Telekom Austria Group – Debt profile as of March 31, 2020 Overview debt instruments Fixed/floating mix 0% 0% 100% 100% Bonds Loans Fixed Floating Lines of credit Ratings  Undrawn committed credit lines  S&P: BBB+ (stable outlook) amounting to EUR 1,015 mn  Moody’s: Baa1 (stable outlook)  Aver

  29. Slide 29: Appendix – Regulatory topics

    Appendix 2 – Regulatory topics

  30. Slide 30: Glide Path of Mobile Termination Rates

    Glide Path of Mobile Termination Rates Jul Jan Jul Jan Jul Jan Mar Jan April 2015 2016 2016 2017 2017 2018 2019 2020 2020 **** Austria (EUR) 0.008049 0.008049 0.008049 0.008049 0.008049 0.008049 0.008049 0.008049 0.008049 Bulgaria (BGN) 0.019 0.019 0.019 0.014 0.014 0.014 0.014 0.014 0.014 Croatia (

  31. Slide 31: Upcoming spectrum tenders/prolongations/assignments

    Upcoming spectrum tenders/prolongations/ assignments* Expected Comments Austria 2020 (700, 1500, 2100 MHz) Austria's second 5G auction (scheduled for April) postponed due to Covid-19 crisis. 2020 (2600, 3400-3800 MHz) Bulgaria 2021 (800 MHz) Croatia 2020 (3500 MHz, 700 MHz) 2020 (3500 MHz) Belarus 2

  32. Slide 32: EU roaming price regulation

    EU roaming price regulation RETAIL (in EURc) July 2014 April 30, 2016 June 15, 2017 Data (per MB) 20 domestic tariff + 5* domestic tariff Voice-calls made 19 domestic tariff + 5* domestic tariff (per minute) Voice-calls received 5 weighted average MTR 0 (per minute) SMS (per SMS) 6 domestic tariff +

  33. Slide 33: Appendix – Personnel restructuring in Austria

    Appendix 3 – Personnel restructuring in Austria

  34. Slide 34: Overview – Restructuring charges and provision vs. FTE

    Overview – Restructuring charges and provision vs. FTE Overview restructuring charges FTEs addressed (in EUR million) 2013 2014 2015 2016 2017 2018 2019 Q1 20 2013 2014 2015 2016 2017 2018 2019 Q1 20 FTE reduction 149.0 86.4 69.5 95.0 9.1 70.1 100.2 17.7 Transfer to government 22 52 49 6 3 0 0 0 Ser

  35. Slide 35: Appendix – Corporate sustainability

    Appendix 4 – Corporate sustainability

  36. Slide 36: Key figures – Corporate Sustainability

    Key figures – Corporate Sustainability Selected group-wide KPIs Ratings Environment 2019 Total CO2 emissions (Scope 1+2 market-based in tonnes) 215.981 Energy efficiency index (in Mwh/terabyte) 0,17 Paper consumption (in kg) 1.273.562 Collected old mobile phones (in pcs) 64.504 Employees 2019 Share

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