Royal KPN NV · EURONEXT:KPN

Royal KPN NV — FY2012 Earnings Presentation

71 slides from Royal KPN NV's earnings presentation, Feb 5, 2013

  1. Slide 1: Annual Results 2012

    Annual Results 2012 Aligning financial position with strategy 5 February 2013

  2. Slide 2: Disclaimers

    Disclaimers Disclaimers This announcement does not constitute an offer to sell, or a solicitation of offers to purchase or subscribe for, securities in the United States. The securities referred herein have not been, and will not be, registered under the US Securities Act of 1933 and may not be offe

  3. Slide 3: Contents

    Contents 1 Chairman’s review Eelco Blok 2 Group financial review Eric Hageman 3 The Netherlands Joost Farwerck 4 International Thorsten Dirks 5 Concluding remarks Eelco Blok 3

  4. Slide 4: Executive summary

    Executive summary 2012 performance • Mixed performances across the Group • Stabilizing domestic market positions, strong growth in TV • Highly valuable spectrum acquired in The Netherlands • Financial outlook largely achieved, supported by asset disposals Strategic review • The Netherlands expected

  5. Slide 5: Telco sector trends

    Telco sector trends Opportunities in a potentially improving environment Past 2013 - onwards • Commercial launch 4G LTE • Investment spectrum licenses LTE / HSPA • Monetize network investments • Preparing network • Growing data demand • Start-up phase • Maturing, increasing penetration FttH • Rollin

  6. Slide 6: Strategic review

    Strategic review Striking the right balance between growth and profitability Strategic objectives 2008 - 2013 - 2015 - 2011 2012 2010 2014 onwards Profitability Market positions Stabilizing Stabilize Improve financial maximization under pressure market positions performance performance Profitability

  7. Slide 7: Aligning financial position with strategy

    Aligning financial position with strategy Strengthening financial position • € 4bn rights issue supporting financial position and strategic flexibility • Substantial reinforcement of balance sheet and financial position − Reduction of net debt level − Support execution of our strategy • Commitment t

  8. Slide 8: Performance versus outlook

    Performance versus outlook Financial outlook largely achieved 2012 2012 Outlook Reported € 4.7bn • EBITDA and free cash flow at EBITDA1 € 4.7 - 4.9bn lower end of the range (€ 4,701m) € 2.2bn • Continued investments in Dutch Capex € 2.0 - 2.2bn market positions; Capex at (€ 2,209m) higher end of the

  9. Slide 9: EBITDA and FCF performance

    EBITDA and FCF performance 2012 EBITDA and FCF included incidentals EBITDA1 2012 Comments €m 4,701 103 96 • EBITDA1 and free 38 4,464 cash flow2 supported by incidentals in 2012 EBITDA 2012 German Dutch mobile Other incidentals EBITDA 2012 mobile towers towers excl. incidentals • Successful mobile t

  10. Slide 10: Outlook

    Outlook • The Netherlands expected to stabilize towards 2014 • Next phase German strategy expected to lead to service revenue growth combined with lower EBITDA margin, especially in 2013 • Capex in 2013 below € 2.3bn and total planned Capex for the three-year period 2013-2015 of < € 7bn, including R

  11. Slide 11: Revised strategic market objectives

    Revised strategic market objectives • Minimum broadband market share1 >40%; Consumer long-term goal 45% Residential • Growing RGUs and ARPU per customer Consumer • Minimum long-term total mobile NL market Mobile share2 >40% Business - • Leading business & ICT player in The Netherlands Corporate Mark

  12. Slide 12: Contents

    Contents 1 Chairman’s review Eelco Blok 2 Group financial review Eric Hageman 3 The Netherlands Joost Farwerck 4 International Thorsten Dirks 5 Concluding remarks Eelco Blok 12

  13. Slide 13: Commitment to investment grade credit profile

    Aligning financial position with strategy Commitment to investment grade credit profile Today’s financial position… …to be aligned with strategy € bn 14.71 12.8 13.41 12.0 • Rising debt positions • Reduce net debt level 11.7 • Commitment to investment grade Q4 ’11 Q4 ’12 • Lower EBITDA level Gross d

  14. Slide 14: Investment levels

    Investment levels Future annual investments expected to remain at 2012 level €m The Netherlands • Focus on customer driven investments 2010 2011 2012 − Strengthened domestic market positions (TV and (€ 1,148m) (€ 1,306m) (€ 1,419m) FttH activations, handsets) 110 178 116 212 73 − Partly offset by pr

  15. Slide 15: Group results

    Group results €m FY ’12 FY ’11 % • Revenues down 3.5%, incl. impact from sale of Getronics International (2.8%) Revenues and other income 12,708 13,163 -3.5% • EBITDA excl. restructuring costs down Operating expenses (excl. D&A) 8,180 8,025 1.9% 11% mainly due to NetCo and Consumer 1 – Depreciation

  16. Slide 16: Financial review 2012 – The Netherlands

    Financial review 2012 – The Netherlands €m • Revenues down 8.8%, incl. impact sale Revenues and other income Getronics International (4.6%) -8.8% 8,259 − Regulatory impact of € 83m (1.0%) − Lower revenues at Consumer Mobile, NetCo and Business 7,532 • EBITDA excl. restructuring costs down 11% − € 72

  17. Slide 17: Financial review 2012 – Mobile International

    Financial review 2012 – Mobile International € m 41.8% 39.8% 39.6% • Revenues Germany up 5.0% 38.2% 38.5% 39.0% − Underlying service revenue growth 2.1%, excluding tower sales, other incidentals and regulation Germany +5.0% 3,243 3,404 • EBITDA margin1 at 39.0% − Underlying EBITDA margin at 36.8%, c

  18. Slide 18: Group cash flow

    Group cash flow €m FY ’12 FY ’11 % • Free cash flow of € 1,652m in 2012 Operating profit 1,820 2,549 -29% − € 610m lower EBITDA Depreciation and amortization1 2,708 2,589 4.6% − € 255m higher taxes paid Interest paid/received -661 -637 3.8% − € 162m higher Capex Tax paid/received -486 -231 >100% − €

  19. Slide 19: Contents

    Contents 1 Chairman’s review Eelco Blok 2 Group financial review Eric Hageman 3 The Netherlands Joost Farwerck 4 International Thorsten Dirks 5 Concluding remarks Eelco Blok 19

  20. Slide 20: Strategic review – The Netherlands

    Strategic review – The Netherlands Towards a best-in-class integrated access provider Customer focus Products Networks Cost leadership Towards a best-in-class integrated access Highest quality Full-range Best-in-class Lean operation provider across all segments • Best customer • Introducing quad • H

  21. Slide 21: Strategic review – The Netherlands (cont’d)

    Strategic review – The Netherlands (cont’d) Towards fixed-mobile convergence Uniquely positioned • Nationwide fixed network • #1 mobile network1 • 4G LTE services • All customers in reach Rationale Device convergence • Increase customer loyalty • Internet on TV • Reduce churn in mobile • Voice over

  22. Slide 22: Operating review – Consumer Residential

    Operating review – Consumer Residential Broadband customer base growth, market share stable 2.01 2.07 1.92 1.94 1.97 • RGUs per customer increased by 7.8% y-on-y per customer RGUs & ARPU 1.85 1.87 1.89 − Accelerated growth triple play packages, 321k3 net 38 38 39 39 39 39 40 41 adds in 2012 (2011: 1

  23. Slide 23: Operating review – Consumer Residential (cont’d)

    Operating review – Consumer Residential (cont’d) High quality networks and market leading propositions Network upgrades on track Market leading IPTV proposition • ~70% coverage of Dutch market with minimum Features guaranteed speed of 40Mbps # of channels >60 >60 >50 • Continued FttH roll-out and ne

  24. Slide 24: Operating review – Consumer Residential (cont’d)

    Operating review – Consumer Residential (cont’d) Lower broadband copper churn and growing FttH penetration TV important to reduce broadband churn FttH penetration increasing • Market leading IPTV proposition • KPN FttH base at 368k  Increasing NPS scores for IPTV  Strong FttH activations, 44k in Q

  25. Slide 25: Strategy in detail – Consumer Residential

    Strategy in detail – Consumer Residential Continue successful strategy, TV key driver for success Strategic initiatives Addressable Propositions market Focus on bundles, offering integrated fixed Continue to expand addressable market through and mobile services on all devices hybrid VDSL and FttH ne

  26. Slide 26: Operating review – Consumer Mobile

    Operating review – Consumer Mobile Market share stabilizing in competitive mobile market € m 47% 46% 45% 45% 45% 44% 45% • Service revenues (incl. wholesale) down by 44% 6.9% y-on-y 442 446 430 revenues 406 387 403 387 378 − Regulatory impact (0.9%) Service − Lower traffic partly offset by committed

  27. Slide 27: Operating review – Consumer Mobile (cont’d)

    Operating review – Consumer Mobile (cont’d) Steps taken in 2012, increased focus on value going forward Customer base Derisking ARPU Costs -1.9%-points -0.1%-points 46% 33% • SAC/SRC still high 46.2% 25% 44.3% 44.2% 18% 9% 0% • Increased marketing costs Q4 ’10 Q4 ’11 Q4 ’12 Q3 ’11 Q4 ’11 Q1 ’12 Q2 ’

  28. Slide 28: Strategy in detail – Consumer Mobile

    Strategy in detail – Consumer Mobile 4G to offer best customer experience Equilibrium changed1 Best customer experience 2G 3G 4G - 4G - 4G - Nationwide MHz • Indoor coverage up to 3x better than 3G, 800MHz 1800MHz 2.6GHz Fixed Wi-Fi speeds up to 10 times higher • Highest speeds ensure best customer

  29. Slide 29: Strategy in detail – Consumer Mobile (cont’d)

    Strategy in detail – Consumer Mobile (cont’d) Optimizing customer lifetime value Strategic initiatives Differentiated Monetize captive propositions distribution Increase value by upselling and cross selling Leading captive sales channels (shops, online and bundled offers (4G, fixed-mobile) call cent

  30. Slide 30: First step towards quad play

    First step towards quad play Introduction ‘KPN Compleet’ KPN triple play KPN mobile ‘KPN Compleet’ First step + = Customer benefits1 + + 45 additional Free unlimited calls Doubling voice, IPTV channels within family SMS and data ‘KPN Compleet’ accessible for all KPN’s fixed and mobile customers Next

  31. Slide 31: Operating review – Business & Corporate Market

    Operating review – Business & Corporate Market €m 33.4% • Stable market positions in Business 32.4% 2,433 2,352 • Lower revenues in Business due to decline in traditional services and price pressure revenues Business 1,326 1,254 948 941 159 157 • Business wireless revenues stable, supported FY 2011

  32. Slide 32: Strategy in detail – Business

    Strategy in detail – Business Moving towards one-stop-shop for B2B Changing customer demand Organizational changes Uniquely positioned 2012 From connections Corporate Business • One-stop-shop for B2B to collaboration Market • Integrated sales, marketing and customer care 2013 organization From pay-p

  33. Slide 33: Strategy – The Netherlands Revised strategic market objectives

    Strategy – The Netherlands Revised strategic market objectives • Minimum broadband market share1 >40%; Consumer long-term goal 45% Residential • Growing RGUs and ARPU per customer Consumer • Minimum long-term total mobile NL Mobile market share2 >40% Business - • Leading business & ICT player in The

  34. Slide 34: Contents

    Contents 1 Chairman’s review Eelco Blok 2 Group financial review Eric Hageman 3 The Netherlands Joost Farwerck 4 International Thorsten Dirks 5 Concluding remarks Eelco Blok 34

  35. Slide 35: Strategic review – Germany

    Strategic review – Germany Moving into next strategy phase; data-centric Challenger Proven track record; transition to data-centric Challenger 20% ~16% Proven track record Prepare for data Data-centric Challenger • Focus on mass market • Acquired valuable spectrum 1. Monetize competitive data networ

  36. Slide 36: Operating review – Germany

    Operating review – Germany Accelerating postpaid net adds Net adds • 2012 underlying service revenue growth of 2.1% 23.1 23.5 24.0 23.4 22.7 21.0 21.5 22.1 − Underlying service revenue growth of 0.4% in Q4 • Record number of postpaid net adds in 20121 434 456 518 458 284 1712 − Strong postpaid net a

  37. Slide 37: Operating review – Germany (cont’d)

    Operating review – Germany (cont’d) Postpaid focus in line with next strategy phase Lower growth in prepaid Postpaid focus leading to more valuable customers • Increased competition in ethnic segment and from other MNOs • Highest number of postpaid net adds in 20122 • #1 in prepaid service revenue m

  38. Slide 38: Strategy in detail – Germany

    Strategy in detail – Germany Monetize competitive data network 2010 - 2012: Voice + SMS + Data Network ranking High speed data coverage Q3 2012 • >85% population coverage with up to 21Mbps − Geographical coverage in line with 3rd best network overall targeted customer base  1st Voice coverage  2nd

  39. Slide 39: Strategy in detail – Germany (cont’d)

    Strategy in detail – Germany (cont’d) Grow in underpenetrated regions, optimize distribution & branding 2 Utilize network in underpenetrated regions 3 Expand online and addressable market • Successful in regional market share gains • Grow in underpenetrated regions by • Growth opportunity in underpe

  40. Slide 40: Strategy in detail – Germany (cont’d)

    Strategy in detail – Germany (cont’d) Improve underlying cost structure 4 Reduce indirect costs… …to invest in growth Indirect costs Investments as % of in growth as revenue % of revenue 2012 2015 2012 2015 • Network and IT costs • Increase investments in growth ‒ Continued network cost efficiency t

  41. Slide 41: Strategic review – Belgium

    Strategic review – Belgium Moving into next strategy phase; mobile-centric Challenger Proven track record; transition to mobile-centric Challenger 25% ~20% Proven track record Prepare for data Mobile-centric Challenger • Low-cost to serve • Data network roll-out 1. Introduce innovative propositions

  42. Slide 42: Operating review – Belgium

    Operating review – Belgium Good performance despite increasing competitive landscape Net adds • Underlying service revenue growth of 8.8% 4.4 3.9 3.9 4.1 4.1 4.3 3.7 3.4 in Q4 − Growth driven by B2B, wholesale and data 2341 • Service revenue market share increased to 136 152 9 133 132 ~20% 40 412 14

  43. Slide 43: Strategy in detail – Belgium

    Strategy in detail – Belgium Moving into next strategy phase; mobile-centric Challenger Commercial Network Distribution • New innovative propositions • Create competitive edge by • Focus on underpenetrated − Improve customer experience speed differentiation regions (i.e. Spotify, content) − Improvin

  44. Slide 44: Contents

    Contents 1 Group strategy Eelco Blok 2 Group financial review Eric Hageman 3 The Netherlands Joost Farwerck 4 International Thorsten Dirks 5 Concluding remarks Eelco Blok 44

  45. Slide 45: Concluding remarks

    Concluding remarks 2012 performance • Mixed performances across the Group • Stabilizing domestic market positions, strong growth in TV • Highly valuable spectrum acquired in The Netherlands • Financial outlook largely achieved, supported by asset disposals Strategic review • The Netherlands expected

  46. Slide 46: Q&A

    Q&A 46

  47. Slide 47: Annex

    Annex Annex For further information please contact KPN Investor Relations +31 70 44 60986 ir@kpn.com www.kpn.com/ir

  48. Slide 48: Group financial profile

    Group financial profile € bn Debt Financing policy 13.9 13.6 13.5 13.3 13.3 13.1 12.8 12.8 2.5x 2.7 2.7 2.6 12.8 2.5 2.4 2.4 12.5 12.4 12.4 2.3 12.0 2.0x 2.2 11.9 11.8 11.7 Q1 ’11 Q2 ’11 Q3 ’11 Q4 ’11 Q1 ’12 Q2 ’12 Q3 ’12 Q4 ’12 Q1 ’11 Q2 ’11 Q3 ’11 Q4 ’11 Q1 ’12 Q2 ’12 Q3 ’12 Q4 ’12 Gross debt Net

  49. Slide 49: Financial review Q4 – Dutch Telco

    Financial review Q4 – Dutch Telco €m • Revenues and other income down 3.5% y-on-y Revenues and other income − Regulatory impact of € 9m (0.5%) -3.5% − Lower revenues at Consumer Mobile, NetCo and Business • EBITDA excluding restructuring costs down 6.8% 1,704 1,705 1,651 1,704 1,626 1,618 1,644 y-on

  50. Slide 50: Financial review Q4 – Dutch Telco by segment

    Financial review Q4 – Dutch Telco by segment €m • Revenues Consumer Mobile down 9.4% y-on-y Consumer Mobile 34.4% 33.3% − Service revenue decline of 6.9%, impacted by 30.2% 30.4% 28.8% 29.4% 27.6% regulation of € 4m (0.9%) − Lower traffic revenues partly offset by higher 22.0% committed revenues 480

  51. Slide 51: Financial review Q4 – Dutch Telco by segment

    Financial review Q4 – Dutch Telco by segment €m • Revenues Business down by 3.3% y-on-y Business − Regulatory impact of € 3m (0.5%) 35.0% 34.8% 34.1% − Lower traffic, decline in traditional services and 32.8% 33.4% 31.8% 30.1% 31.2% price pressure − Partly offset by good results challenger brands •

  52. Slide 52: Financial review Q4 – Corporate Market & iBasis

    Financial review Q4 – Corporate Market & iBasis €m Corporate Market1 • Revenues Corporate Market The Netherlands 8.0% 9.6%2 6.8% 6.9% down 7.8% y-on-y 5.0% 6.1% 5.5% 1.6% − Continued price pressure due to overcapacity in the 499 sector 448 439 424 428 366 − Clients postponing large investments 291 3

  53. Slide 53: Financial review Q4 – Mobile International

    Financial review Q4 – Mobile International €m 41.6% 42.4% 43.9% 39.6% • Revenues Germany up by 12% y-on-y 38.9% 38.2% 39.8% 38.5% − Underlying revenue growth of 0.7%, corrected for tower sales and MTA Germany 38.6%1 32.1%2 • EBITDA margin3 at 39.6% 929 − Underlying EBITDA margin at 32.1%, corrected

  54. Slide 54: Operating expenses Dutch Telco

    Operating expenses Dutch Telco Breakdown operating expenses Dutch Telco • Operating expenses (excl. D&A and restructuring (excl. D&A and restructuring costs) costs) in Q4 flat y-on-y − Employee benefits up € 5m due to higher wages and +0.1% social security contributions partly offset by ongoing €m 8

  55. Slide 55: Analysis of results

    Analysis of results Impact regulation, incidentals and restructuring €m Q4 ’12 Q4 ’11 FY ’12 FY ’11 Revenue effect MTA reduction Regulation Group -21 -94 -102 -459 Roaming tariff reduction Regulation Group -9 -7 -32 -27 EBITDA1 effect MTA reduction Regulation Group -11 -39 -40 -192 Roaming tariff re

  56. Slide 56: Restructuring costs

    Restructuring costs €m Q4 ’12 Q4 ’11 FY ’12 FY ’11 Germany -39 - -39 - Belgium - -1 - -2 Rest of World -2 - -2 -3 Mobile International -41 -1 -41 -5 Consumer Mobile - -1 -2 -1 Consumer Residential1 -4 -2 -27 -4 Business -15 -3 -27 -3 NetCo -22 -8 -42 -9 Other - - -3 -3 Dutch Telco -41 -14 -101 -20 C

  57. Slide 57: Impact MTA reduction

    Impact MTA reduction €m Q4 ’12 FY ’12 1 1 Revenues EBITDA Revenues EBITDA Germany -9 -5 -9 -5 Belgium -7 -4 -26 -13 Mobile International -16 -9 -35 -18 Consumer Mobile -2 -1 -35 -13 Of which: Mobile Wholesale - - -6 - Business -1 -1 -15 -8 NetCo -2 - -17 -1 Intercompany - - - - The Netherlands -5 -2

  58. Slide 58: Operating expenses

    Operating expenses €m Q4 ’12 Q4 ’11 % Employee benefits 467 480 -2.7% Cost of materials 215 285 -25% Work contracted out and other expenses 1,150 1,127 2.0% Own work capitalized -30 -31 -3.2% Other operating expenses1 351 198 77% Depreciation2 436 470 -7.2% Amortization2 556 410 36% Total 3,145 2,93

  59. Slide 59: Operating expenses - analysis Employee benefits & Cost of materials

    Operating expenses - analysis Employee benefits & Cost of materials €m Employee benefits Y-on-Y decrease 16.8% • Lower costs due to sale of Getronics International 14.9% 14.6% 15.2% 15.3% • Partly offset by higher pension costs relating to 14.4% 13.7% 14.2% actuarial losses Getronics UK & US (€ 19m)

  60. Slide 60: Operating expenses - analysis Work contracted out & Other

    Operating expenses - analysis Work contracted out & Other €m Work contracted out Y-on-Y increase 37.7% • Higher traffic costs Mobile International and iBasis 36.2% 36.2% 36.5% 34.6% 34.7% 34.8% • Higher costs related to acquired wholesale platform 34.2% and FttH activations NetCo • Higher content co

  61. Slide 61: Operating expenses - analysis Depreciation & Amortization

    Operating expenses - analysis Depreciation & Amortization €m Depreciation1 Y-on-Y increase 14.3% 13.6% 14.3% • Additional depreciation assets under construction 10.9% 11.4% Germany (€ 32m) 10.7% 10.8%2 10.5% 10.7% • Introduction new mobile propositions, incl. handset lease model at Consumer Mobile a

  62. Slide 62: Tax

    Tax P&L Cash flow Fiscal units (€ m) Q4 ’12 Q4 ’11 Q4 ’12 Q4 ’11 The Netherlands -56 -104 -1381 -741 Corporate Market 4 37 - -2 Germany 22 47 -11 -4 Belgium 8 -12 - - Other - -1 -4 -2 Total reported tax -22 -33 -153 -82 Effective tax rate 15.9% 15.6% • Q4 ’12 effective tax rate of 15.9% due to  Rev

  63. Slide 63: Debt portfolio

    Debt portfolio Breakdown of € 13.3bn gross debt1 15% 79% 6% Other Global bonds 5% 6% EUR USD 2 GBP 2 Eurobonds 89% 100% Fixed 3 1 Nominal value of interest bearing financial liabilities related to these liabilities 2 Foreign currency amounts hedged into EUR 3 Excluding bank overdraft 63

  64. Slide 64: Dutch wireless disclosure

    Dutch wireless disclosure €m Q4 ’12 Q4 ’11 % Service revenues 633 665 -4.8% − Consumer retail 336 364 -7.7% − Business 246 254 -3.1% − Other1 51 47 8.5% SAC/SRC − Consumer retail2 165 162 1.9% − Business 311 249 25% 1 Includes amongst others Consumer Mobile wholesale and visitor roaming revenues at

  65. Slide 65: Mobile International wireless disclosure

    Mobile International wireless disclosure Service revenues growth Germany Service revenues growth Belgium 15.0% 11.4% 11.1% 11.8% 8.1% 8.1% 8.9% 9.0% 8.8% 7.9% 7.5% 7.2% 7.8% 4.2% 6.3% 5.3% 4.2% 3.5% 3.0% 3.0% 2.8% 2.8% 1.0% 1.2% 0.5% 0.9% 0.4% -0.5% -0.6% -1.0% -3.9% -5.3% Q1 ’11 Q2 ’11 Q3 ’11 Q4 ’1

  66. Slide 66: Regulation MTA rates across the Group

    Regulation MTA rates across the Group NL • OPTA is preparing a new decision; publication draft decision expected February 2013 € ct / min Until 7 July 7 July ’10 Sep ’10 Jan ’11 Sep ’11 Sep ’12 MTA rate 7.00 5.60 5.60 4.20 2.70 2.40 Impact on Group GER • Legal proceedings against former MTA decision

  67. Slide 67: Regulation Spectrum in The Netherlands

    Regulation Spectrum in The Netherlands 800MHz Tele2 VOD KPN 2*30 Paired 2*10 2*10 2*10 900MHz VOD KPN T-Mob 2*35 Paired 2*10 2*10 2*15 1.8GHz KPN VOD T-Mob 2*70 Paired 2*20 2*20 2*30 1.9GHz T-Mob KPN VOD T-Mob 1*35 Unpaired 10 5 5.4 14.6 Current status 2.1GHz VOD KPN T-Mob KPN VOD T-Mob 2*59.4 Paire

  68. Slide 68: Regulation Spectrum in Germany

    Regulation Spectrum in Germany 800MHz O2 VOD DT 2*30 Paired 2*5 2*5 2*5 2*5 2*5 2*5 900MHz E+ O2 DT VOD 2*34.8 Paired 2*5 2*5 2*12.4 2*12.4 1.8GHz DT E+ O2 VOD E+ 2*69.8 Paired 2*5 2*5 2*5 2*5 2*5 2*17.4 2*5 2*5 2*17.4 2.1GHz VOD E+ O2 DT 2*64.35 Paired 2*4.95 2*9.9 2*4.95 2*4.95 2*9.9 2*4.95 2*9.9

  69. Slide 69: FTE reduction program on track

    FTE reduction program on track • ~1,550 less FTE in The Netherlands since start FTE reduction program − Accelerated investment strategy and net effect M&A leading to ~350 FTE increase − ~1,900 less FTE resulting from FTE reduction program, mainly at Corporate Market • € 257m restructuring costs per

  70. Slide 70: Infrastructure

    Infrastructure Deploying mix of technologies going forward VDSL from VDSL pair bonding Vectored VDSL ADSL on central office central office from copper (VDSL-CO) (VDSL-CO) street cabinet FttH Wireless Central Central Central Central office office office office ODF1 Street cabinet up to 20 Mbps DS2 up

  71. Slide 71: Unbundling tariffs

    Unbundling tariffs Unbundling in copper network Category Monthly tariff Line sharing (LLU)1 € 0.12 / line MDF Node Fully unbundled (LLU)1 € 6.84 / line SDF colocation KPN / Telco MDF colocation1 € 911.74 footprint / year ~28,000 1,350 MDF backhaul Commercial pricing, not regulated street cabinets lo

Royal KPN — FY2012 Earnings Presentation on 6ix