Sonaecom Sgps Sa · EURONEXT:SNC
Sonaecom Sgps Sa — Sonaecom — FY2004 Earnings Presentation
25 slides from Sonaecom Sgps Sa's earnings presentation, Feb 28, 2005
Slide 1: Sonaecom Full Year Results
Sonaecom 2004 Full Year Results 28 February 2004
Slide 2: 2004 Overview
2004 Overview
Slide 3: Improving Operating Profitability, Positive Net Results for the First Time
Improving Operating Profitability Positive Net Results for the First Time We recorded strong performance in 2004: ¾ Topline growth of 5% to 880 million euros; ¾ Significant growth in EBITDA of 38% to 201 million euros; ¾ Strong FCF growth of 80% to 62 million euros; ¾ Net Results were 39 million eur
Slide 4: Key Initiatives in 2004
Key Initiatives in 2004 Organizational Initiatives: ¾ Integrating Structures; ¾ Improving Processes; ¾ Concentrating traffic on our network. Growth Initiatives: ¾ Commercial launch of UMTS; ¾ Ultra-broadband ULL offers; ¾ Optimus Home: ¾ Acquisition of KPNQwest Portugal. ¾ Continuous innovation with
Slide 5: Key Initiatives in 2004
Key Initiatives in 2004 Technological Initiatives: ¾ UMTS roll-out; ¾ Investment in network capacity and capillarity; ¾ Converging to a single state-of-the-art IP network: ¾ ADSL 2+; ¾ Gigabit Ethernet; ¾ Softswitches. Regulatory Initiatives: ¾ Sonaecom continued its efforts, in 2004, to ensure a fa
Slide 6: Financial Review
Financial Review
Slide 7: Consolidated Turnover Growth
Consolidated Turnover Growth Turnover (euros millions) +5% 900 880 880 860 +6% 838 840 820 800 789 780 760 740 2002 2003 2004 7
Slide 8: Significant reduction in Consolidated OPEX
Significant reduction in Consolidated OPEX Total OPEX (euros millions) 710 -3% 702 700 690 -1% 678 680 671 670 % Turnover 660 89% 81% 76% 650 2002 2003 2004 8
Slide 9: Strong EBITDA Margin Improvement
Strong EBITDA Margin Improvement EBITDA (euros millions) 250 +38% 201 200 +103% 146 150 100 72 50 EBITDA 9% 17% 23% Margin 0 2002 2003 2004 9
Slide 10: Positive Net Results for Full Year
Positive Net Results for Full Year Net Results (euros millions) 60 +€ 59mn 39 40 20 0 -20 -40 -20 -60 -80 -100 -120 -99 +€ 79mn 2002 2003 2004 10
Slide 11: Strong increase in FCF (levered)
Strong increase in FCF (levered) FCF (euros millions) 80 +76% 62 60 35 40 20 0 -20 -40 -60 -55 +€ 89mn -80 2002 2003 2004 11
Slide 12: Net Debt Evolution
Net Debt Evolution Nominal Net Debt (euros millions) -11% 377 -18% 400 336 374 275 300 316 200 256 100 0 2002 2003 2004 Nominal Net Debt Net Debt 12
Slide 13: Improvement in Nominal Debt Ratios and Interest Cover
Improvement in Nominal Debt Ratios and Interest Cover Interest Cover & Net Debt / EBITDA 12 ,4 x 14,0 x 12,0 x 10,0 x 7 ,9 x 8,0 x 5 ,2 x 6,0 x 4,0 x 2 ,2 x 1,4 x 2,0 x 3 ,6 x 0,0 x 2002 2003 2004 D:E 55% 54% 41% Ne t De b t / EBITDA Inte re s t Co ve r 13
Slide 14: Improvement in Productivity
Improvement in Productivity Turnover / Employees EBITDA / Employees 378 100 400 346 86 350 314 300 80 60 250 60 200 150 40 29 100 20 50 0 0 2002 2003 2004 2002 2003 2004 (EBITDA - CAPEX) / Employees 40,00 33,53 30,00 20,00 9,23 10,00 0,00 -10,00 2002 2003 2004 -20,00 -30,00 -22,02 14
Slide 15: Looking Forward
Looking Forward
Slide 16: Margin Momentum
Margin Momentum 2005 EBITDA and Cash Flow (euros millions) Reduction in mobile 250 201 termination rates 200 146 150 Increased spend on 78 brands. 100 72 EBITDA 50 22 Increased Marketing Margin 9% 17% 23% and Sales costs for 0 UMTS and BB -50 -100 -55 Fixed business 2002 2003 2004 transition to Dire
Slide 17: Going Forward
GOING FORWARD Capitalize on new money value propositions ¾ Home ¾ Clix/Novis Mega ADSL + voice Change the market ¾ Co-ownership of networks and content ANACOM ¾ Network externalities Competition Authority ¾ Abuse of dominant position European Commission Innovate 17
Slide 18: Appendices
Appendices
Slide 19: Growth - Telecoms
Growth - Telecoms Portuguese Telecommunications Market Triple Play TV €467m UMTS; ADSL; SHDSL; Data €50,1m €734m Mobile Internet Relatively Mature Market; Voice €3,131m €1,913m Fixed to Mobile Substitution Mobile Fixed Source: Yankee Group, Setembro 2003 (dados para Portugal); “O Mercado das TMTs em
Slide 20: Growth - Media & SSI
Growth - Media & SSI Media ¾ Brand Extension Initiatives - Público ¾ Increase Circulation S&SI ¾ Leverage Strategic Partnerships ¾ Grow International Markets 20
Slide 21: Ultra Broadband Network
Ultra Broadband Network National National Core Core Network Network of of Fiber Fiber Optics Optics KEY STRATEGIC ASSET •• Fiber Fiber optical optical network network with with aa significant significant geographical geographical coverage coverage High Capacity Backbone (3000 kms) •• 3.082 Km of fib
Slide 22: Ultra Broadband Network
Ultra Broadband Network STRATEGIC MOVE PT • Go Direct Access Central Office Fiber Optic Sonaecom • Go IP Broadband ring (MAN) Network Main Main Central Central Offices Offices –– Interco+SHDSL Interco+SHDSL Economic Technical Economic Evaluation Technical Evaluation 1Q 2005 ~90 CO 3Q 2005 ~130 CO EO
Slide 23: UMTS
UMTS Network Elements (EOY04): 501 NodeB’s on air (from a total of 544 NodeB’s installed). Coverage: • Metropolitan area of Lisboa and Porto • Main Cities (all District Capitals and 50 other important cities) UMTS License Obligation (24.7 % population and 1.6% area @ 128 kbps) requirements exc
Slide 24: Regulation
Regulation Key Regulatory Issues ¾ Mobile Network Effect ¾ Tecnical and Economical Barriers to ULL ¾ Copper, Cable and Satellite ownership by PT Group ¾ Content domination by PT Group 24
Slide 25: Shareholder Structure
Shareholder Structure Sonaecom Sonae SGPS 82,79% Free Float 17,21% Telecoms Media SSI 46,29% (1) 56,7% 56,7% 100% 100% 66% Other Shareholders FT 20,2% FT 43,3% FT 43,3% Mgmt 34% 093X 25,7% Maxistar 2,8% Parpública 5,04% (1) 52,34% voting rights 25