Telefonica Sa · BME:TEF

Telefonica Sa — Non-Deal Roadshow (March 2009)

19 slides from Telefonica Sa's roadshow presentation, Mar 18, 2009

  1. Slide 1: Telefónica: Solid fundamentals, benchmark results

    TELEFONICA: “Solid fundamentals, benchmark results” CESAR ALIERTA TELEFÓNICA, S.A., CEO March 18th, 2009 TELEFONICA S.A.

  2. Slide 2: Disclaimer

    Disclaimer This document contains statements that constitute forward looking statements in its general meaning and within the meaning of the Private Securities Litigation Reform Act of 1995. These statements appear in a number of places in this document and include statements regarding the intent, b

  3. Slide 3: Continuing to deliver benchmark results in our industry

    Continuing to deliver benchmark results in our industry Jan-Dec Change Change organic(1) € in millions 2008 FY 08/FY 07 FY 08/FY 07 Revenues 57,946 +2.7% +6.9% „ Superior combination of growth and strong CF OIBDA 22,919 +0.4% +14.7% generation: OIBDA Margin 39.6% -0.9 p.p. +2.6 p.p. „ Diversified po

  4. Slide 4: Meeting Group guidance 6 years in a row

    Meeting Group guidance 6 years in a row… Revenue Growth(1) OIBDA Growth(1) +10.6% +7.3% GUIDANCE 6%/8% 9 GUIDANCE 7.5%/11% 9 % Change FY 08/FY 07 % Change FY 08/ FY 07 OI Growth(1) CapEx(1) +20.4% 9 € 8,544 m 9 GUIDANCE 13%/19% GUIDANCE ~ € 8,600 m % Change FY 08/FY 07 FY 08 TELEFONICA S.A. (1) Guid

  5. Slide 5: …by leveraging a highly diversified portfolio

    …by leveraging a highly diversified portfolio… Accesses Dec-08 (millions) 258.9 42% with voice, BB y-o-y growth 195.6 +13.2% and TV bundles 158.3 (+8 p.p. vs Dec-07) 47.3 45.8 +16.6% +18.0% 42.9 12.5 -1.2% +2.0% +9.0% 2.3 +20.9% +29.7% T. España T. Europe T. Latam Total Mobile BB Pay TV Fixed FY 08

  6. Slide 6: …with a high conversion rate of top line growth into cash-flow

    …with a high conversion rate of top line growth into cash-flow FY 08 Organic(1) growth (y-o-y) Organic OIBDA Margin Telefónica Group +20.2% +14.7% Leveraging efficiency +6.9% measures and scale 38.7% economies Revenues OIBDA OpCF(2) Telefónica España Telefónica Latam Telefónica Europe +30.6% +14.3%

  7. Slide 7: Healthy financial profile being acknowledged by credit rating agencies

    Healthy financial profile being acknowledged by credit rating agencies Leverage target : 3,4 2.02x OIBDA „ Continuing leverage improvement: -15% „ €42.7 bn of net fin. debt in Dec-08 2.7x -16% Net Financial „ 5.95% effective interest rate in 2008 Debt/OIBDA 2.3x 1.9x „ Average debt life exceeds 6 ye

  8. Slide 8: T.España: Focus on cash-flow maximization

    T.España: Focus on cash-flow maximization 15,326 „ In wireline, segmented approach to satisfy customer needs: Fixed -3.7% Telephony 77%E „ Wide price range of BB bundles (2P): from 19.90€ to m.s. 56.90€ Lines (´000) Telefónica wholesale „ Integrated offers: 2P users to make on-net mobile 83% lines c

  9. Slide 9: T.Latam: Robust set of results

    T.Latam: Robust set of results „ Successfully managing growth, transformation 22.7% 20.5% and profitability: Accesses „ Steady customer growth drives strong y-o-y organic(1) (y-o-y growth) 1.0% revenue growth (+12.9%) in 2008 „ Solid OIBDA (+ 21.5% y-o-y organic(1) growth) on the Fixed Wireless BB b

  10. Slide 10: T. Europe: sustained market outperformance in UK, new commercial approach in Germany

    T. Europe: sustained market outperformance in UK, while finishing foundations & new commercial approach in Germany UK Germany UK: 1,727 1,088 „ Commercial approach focused on long term 2008 Mobile customer value, anticipating customer needs: 799 730 net adds +45.3% +19.4% „ Simplicity, iPhone and le

  11. Slide 11: Group guidance for 2009

    Group guidance for 2009 Group OpCF (OIBDA-CapEX) (€ in millions) +8%/+11% 14,519 14,201 2008 A 2008 adjusted 2009E for guidance Group Revenues Group OIBDA Group CapEx (€ in millions) (€ in millions) (€ in millions) +1%/+3% Growing Revenues <7,500 57,946 22,919 8,401 22,602 2008A 2009E 2008 A 2008 ad

  12. Slide 12: 2009 regional priorities

    2009 regional priorities „ Sustain leading competitive position across businesses, emphasizing customer loyalty & rational value creation SPAIN commercial initiatives „ Strong focus on OpCF Focused „ Continue to outperform the market in the UK strategy & EUROPE „ Capitalize strengthened business fou

  13. Slide 13: Telecom spend is relatively sheltered under current trading conditions

    Telecom spend is relatively sheltered under current trading conditions Reduce Maintain 100% 90% 80% 52% 70% 63% 68% 75% 78% 60% 83% 84% 88% 88% 50% 40% 30% 48% 20% 37% 32% 10% 25% 22% 17% 16% 12% 12% 0% Travel & Clothing Mobile Personal Fixed Cleaning TV Food Internet Leisure Telephony Care Telephon

  14. Slide 14: We have the levers to preserve CF generation in a more difficult economic environment

    We have the levers to preserve CF generation in a more difficult economic environment „ Strong competitive position across most markets „ Integrated businesses model „ More segmented offer to anticipate customer needs Top line „ Lower entry prices (BB, SIM only …) „ Higher speeds and more advanced s

  15. Slide 15: Accelerating transformation to adapt to new environment

    Accelerating transformation to adapt to new environment „ Network transformation: „ Site build cost reduction „ Transport optimization „ Greater coordination in transport networks between Fixed-Mobile businesses TECHNOLOGY „ Outsourcing initiatives „ Global partner for network support contracts in I

  16. Slide 16: Disciplined use of FCF with a clear priority: shareholder returns

    Disciplined use of FCF with a clear priority: shareholder returns 9%(2) of the current market > € 40 bn cap devoted to shareholder 69% of FCF devoted to Cumulative FCF 07E-10E(1) shareholder remuneration returns in 2008 Growing path in DPS Tactical Share Buybacks Telefónica (in euros) „ 126.7 millio

  17. Slide 17: 2010 “stress case” vs. guidance

    2010 “stress case” vs. guidance 2010 Guidance “Stress case” October 2007 Scenario EPS 1 2.304 € 2.10 € FCFS 2 2.87 € 2.50 € TELEFONICA S.A. (1) Reported EPS. Investor Relations (2) FCF available to remunerate Telefonica S.A. shareholders, to protect solvency levels and to accommodate strategic flexi

  18. Slide 18: In summary

    In summary A reliable company with solid fundamentals Very strong performance Delivering our Group commitments + growth Unmatched organic ahead of peers in 2008 ++ High FCF yield Very attractive Solid financial position investment case Fully committed to return value to our shareholders TELEFONICA S

  19. Slide 19: Telefónica S.A. Investor Relations

    TELEFONICA S.A. Investor Relations 19

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