Sunrise Communications Ag Class A · SIX:SUNN

Sunrise Communications Ag Class A — Q1 2015 Earnings Presentation

26 slides from Sunrise Communications Ag Class A's earnings presentation, May 19, 2015

  1. Slide 1: Sunrise Communications Group AG Q1'15 Financial Results

    Sunrise Communications Group AG Q1’15 Financial Results

  2. Slide 2: Q1'15 Highlights

    Q1’15 Highlights • Revenues increased by 5.3% to CHF 489 million (Q1’14: CHF 464 million)  Mobile hardware revenues of 65 million (Q1’14: CHF 16 million, pre-Freedom introduction)  +58.6k (+4.6%) growth of mobile postpaid customers (+13.9k net adds in Q1‘15)  +32.3k (+39.0%) increase in TV subscr

  3. Slide 3: Agenda

    Agenda 1 Results Q1’15 Andre Krause (CFO) 2 Market Update Timm Degenhardt (CMO) 3 Outlook Libor Voncina (CEO) 4 Q&A © Sunrise 19.05.2015 3

  4. Slide 4: Mobile subscriptions and ARPU momentum

    Mobile subscriptions and ARPU momentum Mobile subscriptions (‘000) Blended ARPU (CHF) 2,477 2,487 2,496 2,465 +0,5 2,424 (1,4%) 37,0 34,9 35,4 35,5 35,4 1,202 1,199 1,193 1,145 1,090 31,9 33,7 32,0 31,8 31,5 1,078 1,090 1,104 1,120 1,132 197 198 199 200 202 3,4 3,5 3,3 3,5 3,6 1 1 Q1’14 Q2’14 Q3’14

  5. Slide 5: Landline internet subscriptions and ARPU momentum

    Landline internet subscriptions and ARPU momentum Subscriptions (‘000) Internet and Sunrise TV ARPUs (CHF) +0.4 +1.0 +1.9 (+1%) 340 330 326 327 329 -1.5 (-4%) 45.3 46.4 47.2 47.2 45.7 220 214 39.0 39.7 39.9 39.3 257 241 229 37.5 39% 30% 15% 107 115 83 89 97 Q1’14 Q2’14 Q3’14 Q4’14 Q1’15 Q1’14 Q2’14

  6. Slide 6: Revenue and EBITDA growth

    Revenue and EBITDA growth Q1’15 Revenue and EBITDA 1 (CHFm) LTM Q1’15 Revenue and EBITDA 1 (CHFm) Reported growth Reported growth 24.5 1.3 6.2 24.5 1.3 6.2 +5.3% +1.0% +4.7% 1.2% 0.2% 1.0% 489 2’075 2’100 464 639 640 638 644 132 133 131 138 Revenue Reported Adjusted Revenue Reported Adjusted EBITDA

  7. Slide 7: Impact of Freedom on Financials and KPIs

    Impact of Freedom on Financials and KPIs Change in Postpaid Business Model Freedom Impact on Subscribers (‘000) 29% • Freedom: 27% 28% 24% • Accelerated customer growth 21% • Hardware revenues and GP increase • Service revenues and GP decrease 524 • SARC savings compensate the decrease in service GP

  8. Slide 8: Overview of results – Income Statement

    Overview of results – Income Statement Financial Results Q1'2015 Q1'2014 Growth CHF million Mobile 320 285 12.3% Landline Services 119 128 (6.5%) of which hubbing 39 37 4.0% Landline Internet 49 51 (4.1%) Total revenues 489 464 5.3% Revenues (excl. hubbing) 450 427 5.4% Gross profit 306 320 (4.6%) %

  9. Slide 9: IFRS Net Income Adjusted for transaction effects

    IFRS Net Income Adjusted for transaction effects 4 (12) 38 113 (167) Q1’15 Reported Debt & derivative repayment Embedded derivatives Transaction costs Transaction Net Loss adjusted Net Loss • The IPO and refinancing transactions negatively impacted the net income by CHF 154.8 million • Dividend capa

  10. Slide 10: Overview of results – Cash Flow Statement

    Overview of results – Cash Flow Statement Cash Flow Q1'2015 Q1'2014 CHF million EBITDA 133 132 Change in net working capital (110) (98) Movement in pension and provisions 1 (0) Interest (paid) / received, net incl. foreign currency impact (60) (33) thereof IPO and refinancing transaction impacts (29

  11. Slide 11: Capital Expenditure and Cash Impact

    Capital Expenditure and Cash Impact CAPEX development (CHFm) Adj. EBITDA – Capex (CHFm) +19 -16 (+6.8%) (-4.6%) 356 301 340 281 213 193 Mobile 119 120 Landline IT, Shops & 25 26 Other FY’14 Q1’15 FY’14 LTM Q1’15 • Planned reduction in mobile Capex as network overhaul is nearing completion • Focus on

  12. Slide 12: Net debt, leverage ratio and equity development

    Net debt, leverage ratio and equity development Net debt March 31, 2015 Dec 31, 2014 CHF million Senior Secured Notes - 746 Senior Secured Notes issued July 2012 - 520 Senior PIK Toggle Notes - 631 Floating Rate Notes issued July 2012 - 201 Senior Unsecured Notes - 675 Utilized RCF - 73 Senior Secur

  13. Slide 13: Agenda

    Agenda 1 Results Q1’15 Andre Krause (CFO) 2 Market Update Timm Degenhardt (CMO) 3 Outlook Libor Voncina (CEO) 4 Q&A © Sunrise 19.05.2015 13

  14. Slide 14: Innovations Everywhere Connected: Freedom & Home portfolios

    “Freedom” & “Home” portfolios with sustained momentum Freedom penetration (‘000) Freedom: Innovative price plan concept • Continued positive trading momentum Everywhere Connected 1,288 1,304 1,320 1,334 • Positive number portability balance underlying the trend 897 809 • Competition reacting to Free

  15. Slide 15: Q1 product innovations

    Q1 product innovations New roaming offers with more value… … covering all customer needs • New travel days all-inclusive packs with Everywhere Connected unlimited calls/SMS and large data volumes for surfing • USA and Canada now in Region 1 and reduced rates for additional popular travel destination

  16. Slide 16: Q1 product innovations cont.

    Q1 product innovations cont. Business Sunrise continues …. … positive momentum Everywhere Connected • Good momentum with new contract wins • Ongoing migrations with large accounts Innovations • Increased competitive dynamics SR Technics Cofely Relevant Fibre optic agreements with utilities… … to ext

  17. Slide 17: Agenda

    Agenda 1 Results Q1’15 Andre Krause (CFO) 2 Market Update Timm Degenhardt (CMO) 3 Outlook Libor Voncina (CEO) 4 Q&A © Sunrise 19.05.2015 17

  18. Slide 18: Financial Outlook

    Financial Outlook • FY 2015 Adjusted EBITDA expected to be at a comparable level to FY 2014, with revenues expected to experience a slight decline for FY 2015  Positive subscriber trends in mobile postpaid, internet and IPTV expected to continue  New roaming offers expected to result in a negative

  19. Slide 19: Agenda

    Agenda 1 Results Q1’15 Andre Krause (CFO) 2 Market Update Timm Degenhardt (CMO) 3 Outlook Libor Voncina (CEO) 4 Q&A © Sunrise 19.05.2015 19

  20. Slide 20: Appendix

    Appendix

  21. Slide 21: Prepaid Customer Development

    Prepaid Customer Development Market and Performance Update • Prepaid revenue market is declining. With increasing smartphone penetration and data consumption (YoY x2) prepaid is becoming less attractive in the main segments and is driving pre-to-post migration • Prepaid strategy focused on value and

  22. Slide 22: Transaction Adjusted Net Income Statement

    Transaction Adjusted Net Income Statement January 1 - Adjustments January 1 - January 1 - March 31, March 31, March 31, 2015 2015 2014 Old Old debt derivatives transaction Old interest Old Old Transaction Old debt Old debt cost derivatives (early derivatives embedded Adjusted Unaudited costs nominal

  23. Slide 23: Transaction Adjusted Cash Flow Statement

    Transaction Adjusted Cash Flow Statement January 1 - Adjustments January 1 - January 1 - March 31, March 31, March 31, 2015 2015 2014 Old debt Old Old Old Old Transaction Old debt Old debt Old debt transaction derivatives derivatives derivatives embedded New Adjusted Unaudited costs nominal interest

  24. Slide 24: Thank you

    Thank you © Sunrise 19.05.2015 24

  25. Slide 25: Contact information

    Contact information Investor Contact Media contact Sunrise Communications Group AG Sunrise Communications Group AG Uwe Schiller Stefan Kern Head of Investor Relations Head of Corporate Communications uwe.schiller@sunrise.net stefan.kern@sunrise.net +41 58 777 96 80 +41 58 777 76 66 Thank you for you

  26. Slide 26: Disclaimer

    Disclaimer This presentation and any materials distributed in connection herewith (together, the “Presentation”) do not constitute or form a part of, and should not be construed as, an offer for sale or subscription of or solicitation of any offer to purchase or subscribe for any securities, and nei

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