Magyar Telekom Telecommunications Plc · BET:MTELEKOM
Magyar Telekom Telecommunications — Magyar Telekom — Q3 2018 Earnings Presentation
25 slides from Magyar Telekom Telecommunications's earnings presentation, November 2018
Slide 1: Magyar Telekom Group investor presentation
Magyar telekom group investor presentation November 2018
Slide 2: Disclaimer
Disclaimer This investor presentation contains forward-looking statements. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore should n
Slide 3: Content
Content 01 Strategy and Market Position 02 2018 Guidance and Dividend 03 Q3 Results 04 Q3 Results by Segment
Slide 4: Strategy and market position
01 Strategy and market position 4
Slide 5: Overview – Magyar Telekom at a glance
Overview – Magyar Telekom at a glance Overview Strategic pillars ▪ Integrated operations in Hungary and Macedonia 1 ▪ Leading telecommunications service provider in both countries ▪ Leading SI/IT service provider in Hungary ▪ Majority owned by Deutsche Telekom (59.2%) Integrated Together. IT & digit
Slide 6: Hungarian telco market positions
Hungarian telco market positions Total mobile market1 Fixed voice market2 Subscribers (mn) Subscribers (mn) Vodafone 4 Other 12 11.32 11.26 11.30 Telenor 3. 07 3. 07 2. 96 INVITEL MT 3 3.2% 3.3% 3.5% DIGI 25.0% 24.6% 25.5% 13.1% 12.4% 9 11.5% 12.4% 23.8% UPC 28.2% 27.4% 27.6% 2 17.6% 18.8% 20.9% MT
Slide 7: IT market in Hungary: 2016-2021
IT MARKET IN Hungary: 2016-2021 Total Revenue B2B1 IT market (HW&SW and IT services)1 EBITDA IT Services 1 market shares (by revenue)3 HUF bn SYSTEM INTEGRATION IT INFRASTR. SI & 700 +3.3% Pack- Custom Apps. OS Infra. IT 611 629 age app. IT & IT Infra. OS proj. 582 591 598 600 534 Hardware &Software
Slide 8: Hungarian economic environment
Hungarian economic environment Growth structure Domestic demand 4.4% 3.7% 3.4% 4.0% ▪ Domestic demand to remain strong 4% 1.5% 2.0% ▪ Governmental measures support consumer spending 2% ▪ Investment levels show volatility due to EU fund cycles 0% ▪ MT leverages positive trends of domestic demand -2%
Slide 9: Network developments in Hungary
network developments in Hungary Mobile Revenuenetwork 1 coverage (population based) EBITDA Fixed network 1 (households covered) HH ‘000 % 97% 98% 99% 100 4,000 3, 670 3, 701 87% 3, 609 90 83% 83% 86% 80 78% 3,000 33% 38% 39% 70 2, 546 60 4% 50 2,000 36% 28% 84% 87% 89% 40 76% 76% 40% 71% 65% 71% 45%
Slide 10: Hungarian mobile spectrum
Hungarian mobile spectrum Current spectrum allocation (MHz) BAND Magyar Telekom 700 MHz 2x5 2x5 2x5 2x5 2x5 2x5 Telenor Vodafone Digi 800 MHz 2x10 2x10 2x10 Free 900 MHz 2x11.8 2x11 2x12 1800 MHz 2x15 2x5 2x25 2x30 2100 MHz 2x15 2x15 2x15 2x5 2x5 2x5 2600 MHz 2x30 2x20 + 1x25 2x20 3.4-3.8 GHz1 2x30
Slide 11: 2018 guidance and dividend
02 2018 guidance and dividend 11
Slide 12: 9M 2018 results and 2018 financial targets
9M 2018 RESULTS AND 2018 FINANCIAL TARGETS 9M 2018 Results Target 2018 (change y-o-y) Strong growth in SI/IT revenue and equipment sales HUF 482 bn around REVENUE Positive service revenue trends (+7.2%) HUF 630 bn Strong revenue growth outweighs margin dilution from changing revenue mix HUF 145.
Slide 13: Dividend policy
Dividend policy Dividend payment and net debt ratio developments Highlights Net debt ratio1 Dividend per share (HUF) 50% 70 45.7% 43.8% 42.9% ▪ Aiming to maintain net debt ratio (net debt/total capital) of 30% - 40% 60 40% 39.1% ▪ AGM approved HUF 25 dividend per share payment based on 2017 Target 3
Slide 14: Q3 2018 results
03 Q3 2018 results 14
Slide 15: Q3 2018 group segmental revenue and EBITDA
Q3 2018 GROUP SEGMENTAL REVENUE AND EBITDA Group segmental revenues1 Group segmental EBITDA1 HUF bn HUF bn +5.4% 58 -6.3% 166 57.2 3.7 0.5 0.2 163.8 164 0.5 57 162 -1.3 56 0.7 160 4.2 55 158 0.6 155.4 54 53.6 156 -3.7 0.0 -0.4 0.0 53 0 0 3Q 2017 Mobile Fixed line SI/IT Energy Mobile Fixed line SI/IT
Slide 16: Q3 2018 strategic highlights
Q3 2018 STRATEGIC HIGHLIGHTS Land Grabbing FMC Digitalization Macedonia ▪ Accelerated fiber rollout to increase ▪ Continuous growth in fixed-mobile ▪ Digitalization to enhance operating ▪ Continued subscriber growth in competitiveness convergent households efficiency and customer experience mobile b
Slide 17: Q3 2018 results by Segment
04 Q3 2018 results by Segment 17
Slide 18: Hungary - total
Hungary - total Revenue1 EBITDA1 HUF bn HUF bn +5.1% -7.3% 154 52 3.7 51.0 152 149.1 50 150 -1.3 1.3 148 1.9 0.2 -1.6 48 1.4 47.3 146 3.2 -3.7 144 46 141.9 -1.4 142 0 0 3Q 2017 Mobile Mobile Fixed Fixed SI/IT Energy Other 3Q 2018 3Q 2017 Gross profit Employee Other operating 3Q 2018 service equipmen
Slide 19: Hungary - Mobile
Hungary - Mobile Mobile SIMs Mobile ARPU1 ‘000 +100 -99 HUF Prepaid 3,446 3Q 2017 6,000 5, 301 5, 401 5, 302 Blended +8.0% Postpaid 3,720 3Q 2018 5,000 41.1% 37.4% 33.3% 4,000 1,063 Prepaid +6.9% 3,000 1,136 2,000 62.6% 66.7% 58.9% 4,899 1,000 Postpaid +2.6% 5,028 0 Sep 2016 Sep 2017 Sep 2018 Total
Slide 20: Hungary – fixed voice, broadband and tv
Hungary – fixed voice, broadband and tv Fixed line customer base Fixed line multiplay residential subscribers ‘000 ‘000 1,437 1,421 -21 +13 1,500 1,385 Voice 1Play Broadbad 1,500 1, 387 1, 366 1, 379 2Play 1,063 1,016 1,126 1,066 1,019 979 PayTV 26% 3Play 1,000 32% 29% 1,000 29% 28% 29% 500 500 38%
Slide 21: Hungary – SI/IT
Hungary – SI/IT SI/IT revenue SI/IT revenue breakdown by vertical segments1 HUF bn 2017, HUF bn Market share1 90 Hardware & Software Finance 11% w/o mobile devices Manufacturing 7% 75 Retail&WS 7% 45% IT Infrastructure 60 50% Prof. Services 11% 39% services Telco+Media 6% 45 System Integration / Uti
Slide 22: Macedonia
Macedonia Financials1 Mobile market Revenues (MKD mn) EBITDA (MKD mn) Subscribers (mn) +1.9% -0.4% +2.7% -0.7% Lycamobile 1,229 2.5 2. 3 2. 3 2. 3 One.Vip 33 2,783 2.6% 3.2% 2.0 Telekom 37 -1 49.5% 48.1% 47.8% 1,221 1.5 2,708 4 -7 1.0 0.5 50.5% 49.3% 49.0% 3Q 2017 Mobile Fixed SI/IT 3Q 2018 3Q 2017
Slide 23: For further questions please contact the IR department
For further questions please contact the IR department: Péter Bauer Rita Walfisch Head of Investor Relations Investor Relations Manager Phone: +36 1 481-7676 Phone: +36 1 457-6084 e-mail: bauer.peter@telekom.hu e-mail: walfisch.rita@telekom.hu ? 23
Slide 24: Appendix: Q3 2018 financial highlights
APPENDIX: Q3 2018 FINANCIAL HIGHLIGHTS HUF mn, except ratios IAS 18 & IAS 11, continuing operation IFRS 9 & IFRS 15, continuing operation Q3 2018 Q3 2017 Q3 2018 Change (%) Q3 2018 Change (%) (IFRS 9/15 effect) Total Revenues 155,381 163,797 5.4% (112) 163,685 5.3% Gross Profit 97,314 94,150 (3.3%)
Slide 25: Appendix: Sustainability measures
APPENDIX: Sustainability measures Environment Society Economy ▪ The Earth ▪ Democracy, information society ▪ Business venture, integrity, transparency Values ▪ A viable and wholesome environment ▪ Future generations, sustainable society ▪ Vision, innovation ▪ Nature, biological diversity ▪ Diversity