Softbank Corp. · TSE:9434

Softbank — Japan Telecom Holdings — H1 FY2002 Earnings Presentation

48 slides from Softbank's earnings presentation, Nov 12, 2002

  1. Slide 1: led BRFLIAR-IVF IDR

    led BRFLIAR-IVF IDR 2002 9 2002 11 12

  2. Slide 2: Presenters

    ( ) E. J- J- CFO CFO Japan Telecom Holdings Co. FY 2002 Interim Results Presentation : Presenters 2

  3. Slide 3: Contents

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom Contents Section 1 4 Section 2 10 Section 3 J- 19 Section 4 ( ) 33 Section 5 44 Japan Telecom Holdings Co. FY 2002 Interim Results Presentation : Contents 3

  4. Slide 4: Section 1: Japan Telecom Holdings Introduction

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom Section 1 Japan Telecom Holdings Co. Section 1: Japan Telecom Holdings Introduction 4

  5. Slide 5: Consolidated financial highlights

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • J- • • • • ( 2001/9 2002/9 849.7 884.8 4.1% 23.4 142.7 508.5% 15.0 141.1 836.3% /( ) (5.1) 43.5 nm 1 /( )( ) (1,624) 13,621 nm EBITDA (%) 16.8% 30.4% 13.6pp Japan Telecom Holdings Co. Section 1 : Consolidated financial highlights 5

  6. Slide 6: Key highlights—Japan Telecom Holdings achievements

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : • J- • • ARPU • ARPU ARPU ( ) • • 12 3G • ( ) • • 36% • IP-VPN • 12 ADSL 20 • Japan Telecom Holdings Co. Section 1 : Key highlights—Japan Telecom Holdings achievements 6

  7. Slide 7: Key highlights—Market background

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : 1: • (‘000) 736 800 • 628 • 600 493 • 400 200 0 • FY01/1H FY01/2H FY02/1H • ADSL 1: • (‘000) 1,844 2,000 • ADSL 180 1,728 • 1,500 • 1,000 580 500 0 FY01/1H FY01/2H FY02/1H : 1. Japan Telecom Holdings Co. Section 1 : Key highlights—M

  8. Slide 8: Objectives of introducing holding company structure

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • • (7 1 ) • • (8 1 ) • • • Japan Telecom Holdings Co. Section 1 : Objectives of introducing holding company structure 8

  9. Slide 9: New holding company structure

    Japan JapanTelecom TelecomHoldings Holdings Financial FinancialHighlights Highlights J-Phone J-Phone Japan JapanTelecom Telecom 2002 8 1 ( 2002 11 1 ) J- (45.08%) (83.3%) (100%) (100%) (100%) (100%) (71%) TS JTN JTUK JTNIS = Japan Telecom Holdings Co. Section 1 : New holding company structure 9

  10. Slide 10: Section 2: Financials

    Japan Telecom Holdings Financials J-Phone Japan Telecom Section 2 Japan Telecom Holdings Co. Section 2 : Financials 10

  11. Slide 11: Summary

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • EBITDA 13.6pp 30.4% • (+9.4%) ( / ) (-15%) • • • • 615 Japan Telecom Holdings Co. Section 2 : Summary 11

  12. Slide 12: Financial Summary

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : ( ) 2001/9 2002/9 / 849.7 884.8 4.1% 23.4 142.7 508.5% 15.0 141.1 836.3% /( ) (5.1) 43.5 nm 129.8 237.8 108.0 (181.9) (186.7) -4.8 18.9 (61.5) -80.4 EBITDA 142.4 269.2 89.0% EBITDA (%) 16.8% 30.4% 13.6pp 2002/3 ( ) 2001/3 5 28 1,704

  13. Slide 13: Consolidated revenue by segment

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • ARPU J- • SOLTERIA Wide-Ether ADSL • ( 2001/9 2002/9 1 671.7 709.1 5.6% 2 196.9 199.0 1.1% 16.8 8.5 -49.4% (35.7) (31.9) - 849.7 884.8 4.1% 1 J- 2 Japan Telecom Holdings Co. Section 2 : Consolidated revenue by segment 13

  14. Slide 14: Consolidated balance sheet

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • • 2002 3 5.7% 9,775 2002/3 2002/3 ( ) 2001/9 2002/9 2,513.0 1,856.3 1,787.5 -3.7% 522.4 391.3 432.9 10.6% (%) 20.8% 21.1% 24.2% - 1,456.0 1,036.6 977.5 -5.7% Japan Telecom Holdings Co. Section 2 : Consolidated balance sheet 14

  15. Slide 15: Consolidated cash flow

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • 1,080 • 25.7% 1,928 • ( 2001/9 2002/9 129.8 237.8 108.0 (181.9) (186.7) -4.8 18.9 (61.5) -80.4 437.1 5.3 -431.8 (142.9) 15.3 158.2 Japan Telecom Holdings Co. Section 2 : Consolidated cash flow 15

  16. Slide 16: Non-consolidated financial highlights

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • 4-7 ( ) 8-9 •4 -7 ( ) •8 ( 2001/9 2002/9 218.7 144.2 -34.0% /( ) (14.5) 8.2 nm /( ) (14.3) 9.5 nm 14.5 9.5 -34.2% 1 ( ) 4,541 2,988 -34.2% Japan Telecom Holdings Co. Section 2 : Non-consolidated financial highlights 16

  17. Slide 17: Change in non-consolidated

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom 2002 9 4 6 7 August - March 8 9 • • • • • • • Japan Telecom Holdings Co. Section 2 : Change in non-consolidated 17

  18. Slide 18: Overall efficiency—Capex and operating expense

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom – J- • • • • • Japan Telecom Holdings Co. Section 2 : Overall efficiency—Capex and operating expense 18

  19. Slide 19: Section 3: J-Phone

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom J- J- Section 3 J-Phone Section 3 19

  20. Slide 20: J-Phone operating highlights

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom J- • • J- • • 4.6% • 12.0% •1 EBITDA • ARPU •9 20.2% • J- • • • • • 3G 12 —2003 9 2G • —2003 J-Phone Section 3 : J-Phone operating highlights 20

  21. Slide 21: Change plan—status and update

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom - • – 18% • – 1.94% • – 2003 • – • ARPU – 20.2% (9 ) • – 670 76 6 (9 ) • – 3,000 • – • – 10% • 2.5G – 76 6 (9 ) • 3G – 2003 9 2G • 1 – EBITDA 30.7%, • – • J- – 3G • – J-Phone Section 3 : Change plan—status and update 21

  22. Slide 22: J-Phone financial highlights

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom J- • • EBITDA 30.7% • EBITDA J- ( ) 2001/9* 2002/9 680.8 711.8 4.6% 43.2 129.8 200.5% 38.0 128.0 236.8% EBITDA 121.4 219.0 80.4% EBITDA (%) 17.8% 30.7% 12.9pp *1 J-Phone Section 3 : J-Phone financial highlights 22

  23. Slide 23: EBITDA performance

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom EBITDA • EBITDA 10.6pp 30.7% 35.0% 30.7% 30.0% 24.3% 25.0% 20.4% 20.1% 20.0% 15.0% 2000/3 2001/3 2002/3 2002/9 2000/3 2001/3 2002/3 2002/9(1H) EBITDA ( ) 214.8 225.7 271.2 219.0 EBITDA (%) 24.3% 20.4% 20.1% 30.7% J-Phone Section 3 : E

  24. Slide 24: Customer growth and churn

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • • J- 1,300 2001 Q4 6.3% • CRM( ) 15,000 2.50% 13,001 2.34% 12,232 12,669 11,617 2.21% 10,518 11,100 2.30% 10,000 2.03% 2.10% 2.08% 1.90% 5,000 2.00% 1.86% 1.70% 0 1.50% FY01/Q1 Q2 Q3 Q4 FY02/Q1 Q2 FY01/Q1 Q2 Q3 Q4 FY02/Q1 Q2 (‘000)

  25. Slide 25: Market share

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • J- 80.0% 70.0% 70.0% 60.0% 60.0% 50.0% 50.0% 40.0% 40.0% 22.1% 29.6% 29.6% 30.4% 27.6% 24.2% 30.0% 30.0% 20.0% 16.0% 16.4% 17.7% 18.0% 20.0% 10.0% 10.0% 0.0% -10.0% 0.0% FY01/Q1 FY01/Q2 FY01/Q3 FY01/Q4 FY02/Q1 FY02/Q2 FY1999 FY2000

  26. Slide 26: Revenue and ARPU

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom ARPU • • ARPU • ARPU ARPU ARPU ( ) 7,900 7,500 7,900 7,400 7,350 8,000 20.0% 6,000 19.5% 15.5% 4,000 14.6% 10.0% 9.9% 2,000 6.8% ARPU 0 0.0% FY00/1H FY00/2H FY01/1H FY01/2H FY02/1H J-Phone Section 3 : Revenue and ARPU 26

  27. Slide 27: Leverage data innovation

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • ARPU • J- ( ) • • J- ARPU* ( 2002 5 ) 10,500 10,000 8,400 6,800 5,500 5,000 0 (yen) * J-Phone Section 3 : Leverage data innovation 27

  28. Slide 28: Sha-mail—market innovation leader

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • 10 700 J- 54% • • • J-SA05: TFT • J-T08: QVGA 8,000,000 60.0% J-SA05 6,000,000 40.0% 4,000,000 20.0% 2,000,000 J-T08 0 0.0% 00/4 6 9 12 01/3 6 9 J-SH52 J-Phone Section 3 : Sha-mail—market innovation leader 28

  29. Slide 29: Acquisition costs and purchasing efficiency

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • 40,000 36,000 • • • • • 41,000 42,000 40,000 39,000 38,000 36,000 36,000 34,000 32,000 ( ) FY01/1H FY01/2H FY02/1H J-Phone Section 3 : Acquisition costs and purchasing efficiency 29

  30. Slide 30: Cost and operating efficiencies

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • – 2002 3,000 • 3G • • • • • • • • J-Phone Section 3 : Cost and operating efficiencies 30

  31. Slide 31: 3G

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom 3G • 2002 6 30 1,000 3G • 2002 12 • 3G • 10,000 – 2G • 2003 9 2G • • J-Phone Section 3 : 3G 31

  32. Slide 32: Vodafone appeal

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • 2001 12 → 2003 • J-Phone Section 3 : Vodafone appeal 32

  33. Slide 33: Section 4: Japan Telecom (Fixed-line) Overview

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom ( ) Section 4 Japan Telecom Section 4 : Japan Telecom (Fixed-line) Overview 33

  34. Slide 34: Japan Telecom financial highlights

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : • ( ) • • • • ( 1 ) ( % 2001/92 2002/93 169.5 174.2 2.8% /( ) (17.9) 10.8 nm /( ) (17.7) 12.8 nm /( ) (17.3) 4.9 nm EBITDA (%) 7.0% 25.5% - 73.0 53.9 -26.2% 1 2 3 ( ) 4 / 3 2 Japan Telecom Section 4 : Japan Telecom financial highlig

  35. Slide 35: Japan Telecom operating highlights

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : • SOLTERIA Wide-Ether • • ARPU • ENOC ( 1 ) ( 2001/92 2002/93 102.8 95.8 -6.8% 31.4 42.7 36.0% 23.3 20.7 -11.2% 11.9 14.8 24.4% 169.5 174.2 2.8% 1 2 3 ( ) 4 / 3 2 Japan Telecom Section 4 : Japan Telecom operating highlights 35

  36. Slide 36: Enterprise data service: SOLTERIA and Wide-Ether

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : SOLTERIA Wide-Ether • IP IP-VPN SOLTERIA 133.5% • 2001 10 Wide-Ether LAN : SOLTERIA + Wide-Ether 35,000 30,657 30,000 25,506 25,000 22,076 18,386 20,000 14,299 15,000 9,928 10,000 5,000 0 FY01/Q1 FY01/Q2 FY01/Q3 FY01/Q4 FY02/Q1 FY02

  37. Slide 37: Consumer data service: ODN Dial-up & ODN-DSL

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : ODN-DSL • DSL ODN • eAccess : ODN ODN-DSL 2,000,000 1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 ODN-DSL 600,000 ODN 400,000 200,000 0 FY01/Q1 FY01/Q2 FY01/Q3 FY01/Q4 FY02/Q1 FY02/Q2 Japan Telecom Section 4 : Consumer d

  38. Slide 38: Voice service

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • ( / ) • ARPU ARPU ( / ) 600 6,000 500 5,000 400 4,000 300 3,000 200 2,000 100 1,000 0 0 FY01/Q1 FY01/Q2 FY01/Q3 FY01/Q4 FY02/Q1 FY02/Q2 FY01/Q1 FY01/Q2 FY01/Q3 FY01/Q4 FY02/Q1 FY02/Q2 ( ) ( ) Japan Telecom Section 4 : Voice service

  39. Slide 39: Japan Telecom—cost savings

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : • • 54 • 30 • 10 • 28 Japan Telecom Section 4 : Japan Telecom—cost savings 39

  40. Slide 40: Execution, execution, execution

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : V V 200 02 / / (2000 8 1 ) (10 ) ADSL / eAccess 40% IVR IBM 02 60% Japan Telecom Section 3: Execution, execution, execution 40

  41. Slide 41: Japan Telecom transformation

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : • 3 1 2 • • • • • • • Japan Telecom Section 4 : Japan Telecom transformation 41

  42. Slide 42: Turbo charged Project V

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : V • 2 x 25 + 2x( ) • 25 • • 25% EBITDA +/ = • • • • 2003 • • 8 3. 1. 2. 1-1 1-2 1-3 1-4 2-1 2-2 3-1 3-2 / Japan Telecom Section 4 : Turbo charged Project V 42

  43. Slide 43: Target

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : … EBIT (%) 10% • 2 5% >10% >10% • EBIT 0 - 6% • 30% -5% • 2004 -10% FY 2001 FY 2004 Japan Telecom Section 4 : Target 43

  44. Slide 44: Section 5: Conclusion

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom Section 5 Japan Telecom Holdings Co. Section 5 : Conclusion 44

  45. Slide 45: Market outlook and Japan Telecom Holdings outlook

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom • • • • FR/CR IP-VPN/Wide-Ether • • 3G • 3G • IP-VPN/Wide-Ether • J- / Japan Telecom Holdings Co. Section 5 : Market outlook and Japan Telecom Holdings outlook 45

  46. Slide 46: Consolidated and non-consolidated forecast

    Japan Telecom Holdings Financial Highlights J-Phone Japan Telecom : • • • •1 600 1,200 ( ) (11 12 ) (5 28 ) 1,770.0 1,770.0 245.0 183.0 65.0 48.0 ( ) (11 12 ) (8 9 ) 147.0 155.0 9.5 8.0 11.5 10.0 Japan Telecom Holdings Co. Section 5 : Consolidated and non-consolidated forecast 46

  47. Slide 47: Thank you

    Thank you A member of the Vodafone Group 47

  48. Slide 48: Forward-looking Statements

    Forward-looking Statements This presentation contains certain forward-looking statements concerning the operations and strategy of JAPAN TELECOM HOLDINGS CO., LTD. (JAPAN TELECOM HOLDINGS, references to which in this disclaimer shall include, as appropriate, JAPAN TELECOM CO., LTD.) and its expectat

Japan Telecom Holdings — H1 FY2002 Earnings Presentation on 6ix