Den Networks Limited · NSE:DEN
Den Networks — Q4 FY2018 Earnings Presentation
24 slides from Den Networks's earnings presentation, May 2018
Slide 1: Investor Update Q4 FY 2017-18
Investor Update Q4 FY 2017-18 May 2018 Den Networks Ltd. Comparable financial figures are for continued businesses only Slide 1 – Investor Update Q4 FY 2017-18
Slide 2: Disclaimer
Disclaimer The information in the presentation may contain “forward-looking statements” which are statements that refer to expectations and plans for the future and include, without limitation, statements regarding Den’s future results of operations, financial condition or business prospects as well
Slide 3: Contents
Contents 1. Cable TV 2. Fixed Line Broadband 3. DEN – Financial Snapshot for Q4 FY 2017-18 & FY 2017-18 4. DEN – Growth Levers for the next level Slide 3 – Investor Update Q4 FY 2017-18
Slide 4: TV Evolution in India - Digitisation completed
TV Evolution in India - Digitisation completed Pre-1990: Doordarshan Era Post-1990: The Satellite Era Start of Terrestrial television in India -Sep’1959 Analogue to Digitization – Phase 4 almost over Regular daily transmission commenced in as well 1965. > 69 Million Cable Digital Subscribers project
Slide 5: High Definition Boxes – Additional opportunity for monetisation
High Definition Boxes – Additional opportunity for monetisation 172.9 Pay-TV Subs 155.0 HD Subs 129.4 Subcribers (Mn) HD HD 10.9% HD 6.8% 1.2% 19.0 10.6 1.5 Source: MPA 2012 2017 2022 HD Subscribers are expected to reach ~11% of the total Pay-TV subscribers by Year 2022. Pricing differential between
Slide 6: Cable Monetisation has just started
Cable Monetisation has just started Cable Monetisation has just started – 2 years phenomenon post digitisation Positive momentum continues across markets on ARPU’s – Phase 3 realisations are moving towards Phase 2 ARPU’s , Phase 2 realisations inching up to align with Phase 1 while Phase 1 ARPU’s co
Slide 7: DEN – New initiatives undertaken to suit customer preferences
DEN – New initiatives undertaken to suit customer preferences •Improved compression •Pan India Reach •Increase capacity • Normal HD + Smart HD with Wi Fi •VAS – Music, Radio, Games Dongle OTT - TV on Mobile handsets. Enabling 2nd screen using cable TV signal Home Gate way for smart Homes Slide 7 – I
Slide 8: Contents
Contents 1. Cable TV 2. Fixed Line Broadband 3. DEN – Financial Snapshot for Q4 FY 2017-18 & FY 2017-18 4. DEN – Growth Levers for the next level Slide 8 – Investor Update Q4 FY 2017-18
Slide 9: India Fixed Line Broadband (FLBB) – Opportunity
India Fixed Line Broadband (FLBB) – Opportunity Only 18 Mn Indian households have FLBB connection, against this CATV already has 15X rise y-o-y in internet 103.5 Mn HH’s connected via existing cable/fibre data traffic in Year 2017 - video content contributed ~65% of Wireless Internet total mobile da
Slide 10: India Fixed Line Broadband (FLBB) – Supportive Environment
India Fixed Line Broadband (FLBB) – Supportive Environment “Cities in the past were built on riverbanks. They are now built along highways. But in the future, they will be built based on availability of optical fiber networks and next-generation infrastructure.” Sh. Narendra Modi Honorable Prime Min
Slide 11: DEN – Fixed Line Broadband (FLBB) 100 Cities Plan
DEN – Fixed Line Broadband (FLBB) 100 Cities Plan Asset lite model with India FLBB Opportunity synergies from existing set-up = improved returns DEN LMO Existing own cable universe and tie- Target existing cable subscriber ups with LMO’s base Scalable to 100 cities in Franchisee model leveraging on
Slide 12: Contents
Contents 1. Cable TV 2. Fixed Line Broadband 3. DEN – Financial Snapshot for Q4 FY 2017-18 & FY 2017-18 4. DEN – Growth Levers for the next level Slide 12 – Investor Update Q4 FY 2017-18
Slide 13: Financial Highlights – Annual FY 2017-18 vs. FY 2016-17
Financial Highlights – Annual FY 2017-18 vs. FY 2016-17 CATV Billed subs : 7.4 Cable ARPU Opex Cost Mn (Incl. Assoc. increased reduced to 8.4 mn) + 19% y-o-y 36% of + 3% y-o-y revenue EBITDA EBITDA Rs. 283 Cr. margin +55% y-o-y (Incl. Assoc. FY18 +22% of Rs 326 crs) revenue PAT loss reduced to Rs (-
Slide 14: Consolidated P&L – Q4 FY 2017-18 and FY 2017-18
Consolidated P&L – Q4 FY 2017-18 and FY 2017-18 Actuals Yearly Growth % INR Crores 4Q'18 3Q'18 4Q'17 FY18 FY17 Q-o-Q (Gr%) Y-o-Y (Var%) FY (Gr%) Subscription- Cable 175 174 157 667 544 1% 12% 22% Subscription - Broadband 16 17 22 73 81 -4% -24% -9% Placement 83 85 89 345 351 -2% -6% -2% Other Operat
Slide 15: EBITDA Bridge – FY 2017-18
EBITDA Bridge – FY 2017-18 Consolidated EBITDA Bridge FY 2017-18 32 74 6 22 115 Rs. Crs. 283 183 EBITDA Subscription Activation Content net Personnel + Others EBITDA FY 2016-17 of placement Other Opex FY 2017-18 Cable EBITDA Bridge FY 2017-18 Broadband EBITDA Bridge FY 2017-18 32 74 6 4 0 1 122 9 Rs
Slide 16: Cable KPIs : Annual
Cable KPIs : Annual +19% +16% +3% ARPU +17% 75 Subscribers 7.2 7.4 Rs. (in mn)* 63 6.2 54 FY 16 FY 17 FY 18 FY 16 FY 17 FY 18 * excludes Associates ~1 Mn subs +22% +3% -1% Subscription +35% 667 Efficiency 91% 94% 93% Rev.(in Cr) 544 404 FY 16 FY 17 FY 18 FY 16 FY 17 FY 18 Slide 16 – Investor Update
Slide 17: Cable ARPU & Subscribers Development
Cable ARPU (Incl. tax- Ind. AS) & Subscribers Development Subscription Revenue ARPU (INR) Billed Subscribers* up 22% in FY18 vs FY17 (mn) (*Incl. Associates 8.4 mn) +1% +19% +3% Blended 92 93 88 Phase 4 66 66 74 54 Phase 3 76 78 43 74 57 7.4 7.2 Phase 2 113 113 109 89 Phase 1 142 144 137 119 FY18 Q3
Slide 18: Consolidated Costs and EBITDA trend - as % of Revenue
Consolidated Costs and EBITDA trend - as % of Revenue EBITDA 16% Opex 22% Content cost 44% Personnel cost 32% 28% 51% 41% 42% 13% 10% 8% -8% FY16 FY17 FY18 Concerted efforts over the last 2 years helped in reducing the overall Personnel and other opex costs * DEN Consolidated numbers Slide 18 – Inve
Slide 19: Broadband KPI’s – FY 2017-18
Broadband KPI’s – FY 2017-18 -1% -17% +5% Homes passed +12% ARPU 767 760 913 (in’000) 868 632 775 FY 16 FY 17 FY 18 FY 16 FY 17 FY 18 +47% -5% Subscribers (‘000) 112 107 76 FY 16 FY 17 FY 18 Slide19 – Investor Update Q4 FY 2017-18
Slide 20: Abridged Balance Sheet
Abridged Balance Sheet INR Crore Ind. AS Mar'18 Dec'17 Mar'17 Share Capital 195 195 194 Reserves & Surplus 590 604 620 Networth 786 799 813 Minority Interest 103 106 90 Mar'18 Mar'17 Short & Long Term Debt 541 499 522 Defferred Revenue 472 471 508 Gearing Ratio (Net) 0.18 0.19 Trade Payables 345 376
Slide 21: Contents
Contents 1. Cable TV 2. Fixed Line Broadband 3. DEN – Financial Snapshot for Q4 FY 2017-18 & FY 2017-18 4. DEN – Growth Levers for the next level Slide 21 – Investor Update Q4 FY 2017-18
Slide 22: DEN – Strong Foundation in place already
DEN – Strong Foundation in place already 8.4 million CATV > Decade CATV Experienced Operations in 13 active subs ; >11 experience Management Team States million subs universe Capex completed – Best in class Content tie-up with Fibre >80%, no more technology, LMO > 15000 major broadcasters subsidies
Slide 23: Growth levers for the next level
Growth levers for the next level Favourable outcome of Tariff order could be a potential game changer DEN NEXT Focus on improving CATV collections HD opportunity – + Monetisation of Phase 3 and 4 Fixed Line Broadband (FLBB) – increasing penetration markets 100 Cities plan and subscription [~50% of D
Slide 24: Contact Information
Contact Information DEN - “India’s Most Attractive Cable TV Brand – 2017” Trust Research Advisory (TRA) Jatin Mahajan Shogun Jain / Payal Dave InvestorRelations@DenOnline.in shogun.jain@sgapl.net / payal.dave@sgapl.net +91 11 4052 2200 +91 77 3837 7756 / +91 98 1991 6314 DEN Networks Ltd. Strategic