Pccw Limited · HKEX:8
Pccw — H1 2012 Earnings Presentation
26 slides from Pccw's earnings presentation, Aug 10, 2012
Slide 1: 2012 Interim Results
Click to edit Master title style 2012 Interim Results For the period ended June 30, 2012 August 10, 2012 - Hong Kong
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain “forward-looking statements” that are not historical in nature. These forward-looking statements, which include, without limitation, statements regarding PCCW's future results of operations, financial condition or business prospects, are based
Slide 3: Overview
Overview George Chan Group Managing Director 2
Slide 4: Solid Financial Performance
Solid Financial Performance (US$ million) Core Business* Consolidated H1’11 H1’12 % change H1’11 H1’12 % change Revenue 1,402 1,418 + 1% 1,562 1,526 - 2% EBITDA 453 471 + 4% 484 492 + 2% Profit Attributable to Equity Holders 100 106 + 6% 106 107 + 1% The Board has declared an interim dividend of 5.5
Slide 5: Financial Review
Financial Review Susanna Hui Group Chief Financial Officer 4
Slide 6: Sound Results Across Core Businesses
Sound Results Across Core Businesses (US$ million) Core Business* PCPD Revenue EBITDA 471 1,418 453 1,376 1,402 432 32% 33% Core 31% EBITDA Margin 137 160 108 45 31 21 H1'10 H1'11 H1'12 H1'10 H1'11 H1'12 • Revenue grew across all core business segments • Increase in EBITDA underpinned by solid perfo
Slide 7: Continued Profit Growth
Continued Profit Growth Profit Attributable to Equity Holders (US$ million) Core Business Pro Forma NPAT HKT (assuming HKT listed on Jan 1, 2011) PCPD 106 100 * 106 85 * 43 43 55 63 63 (63% HKT) (63% HKT) 13 6 1 H1'11 H1'12 H1'10 H1'11 H1'12 Earnings Per Share : 11.51 HK cents (H1’11: 11.33 HK cents
Slide 8: Delivers a Solid Performance
Delivers a Solid Performance AFF up 6% to US$183 million, on track to deliver full year target (US$ million) HKT Revenue HKT EBITDA Mobile 1,223 1,246 TSS 1,180 Others 118 145 + 23% 464 479 107 452 28 44 + 57% 19 337 341 369 + 8% Mobile 212 215 + 2% Local Data 246 Local Telephony 432 434 444 + 2% In
Slide 9: Expands ARPU and Customer Base
Expands ARPU and Customer Base (US$ million) Media Revenue Media EBITDA 162 30 151 152 28 19% 17% EBITDA 6 Margin 4% H1'10 H1'11 H1'12 H1'10 H1'11 H1'12 • Subscriber base increased to 1.17 million as a result of • Slight dip in EBITDA and margins due enriched content offering, launch of self-produce
Slide 10: Achieves Steady Growth
Achieves Steady Growth (US$ million) Solutions Revenue Solutions EBITDA 145 140 22 136 20 18 13% 14% 15% EBITDA Margin H1'10 H1'11 H1'12 H1'10 H1'11 H1'12 • Steady growth of 3% with the order backlog increasing • Continued expansion of EBITDA by 9% to almost US$650 million margins to 15% driven by i
Slide 11: Focus on Cost Efficiencies
Focus on Cost Efficiencies (US$ million) Core Operating Expenses 341 331 312 • Focus on improving opex efficiencies • Improved management of staff costs through increased productivity H1'10 H1'11 H1'12 Core Opex to Revenue Ratio: 23% 24% 23% 10
Slide 12: Financial Performance
Financial Performance Core Group (US$ million) H1’11 H1’12 H1’11 H1’12 Revenue 1,402 1,418 + 1% 1,562 1,526 - 2% Cost of sales (608) (616) (705) (677) Operating expenses (341) (331) (373) (357) Depreciation & Amortization (248) (270) (251) (273) Net other gains 11 - 13 2 Net finance costs (85) (47)
Slide 13: Demand-Driven Core Capex
Demand-Driven Core Capex (US$ million) Media, Solutions & Others 241 HKT 228 • Capex to revenue ratio 21 36 remains within the below 10% guidance • HKT capex remains demand-driven particularly 116 to meet fiber and mobile 7 services 207 205 • Light capex spending 109 required for the Media & Solutio
Slide 14: Strong Financial Position
Strong Financial Position Gross Debt(1) Debt Maturity Profile (US$ million) (US$ million) As at June 30, 2012 Bank Loans 4,528 US$ Bonds 3,318 3,025 706 546 3,018 (HKT) 500 500 500 266 300 2012 2013 2014 2015 2016 2022 FY 2010 FY 2011 H1'12 Gross Debt / 4.8x 3.1x 3.4x • PCCW issued a US$300m10-year
Slide 15: Business Review
Business Review George Chan Group Managing Director 14
Slide 16: Media Business
Media Business 15 = PCCW"
Slide 17: Steady Customer & ARPU Growth
Steady Customer & ARPU Growth • Both ARPU and customer base demonstrated good growth momentum driven by successful customer acquisition and up-selling activities surrounding exclusive premium content. 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 16
Slide 18: Strong Brand Preference by Both Advertisers & Consumers
Strong Brand Preference by Both Advertisers & Consumers Amongst Advertisers… Amongst Consumers… New TV Ranking Survey 1 Most Preferred Pay TV Brand 2 Most Preferred Rank TV Broadcaster PAY TV 1 TVB Broadcaster 40% 2 now TV 35% 32.3% 30% 3 Turner Broadcasting 25% 21.4% 4 Fox International Channel 20%
Slide 19: Compelling Content Captures Customers Who Demand Quality
Compelling Content Captures Customers Who Demand Quality Soccer Tennis Basketball Golf Others SPORTS Mainstream and niche events New* New* New* New* 3D MOVIES 22 movie channels with 1,300+ hrs on demand KIDS & EDUCATION 26 channels & on- demand learning and edutainment content 18 * Available in Aug-
Slide 20: Original Production & Co-Production
Original Production & Co-Production Quality Chinese programs to satisfy the under-served middle and higher income segments in Hong Kong Builds up a content library for overseas distribution Star studded variety and talk shows Financial news & in-depth analysis from Hunan TV re-packaged to appeal
Slide 21: Innovative Services Extend Reach & Attract Premium Customers
Innovative Services Extend Reach & Attract Premium Customers PCCW Solutions provides the leading technology to enhance now TV’s customer experience. OTT Services HD Services • 23 HD channels & on-demand content Over 880K+ now apps downloads - attracting new • Most comprehensive in town and existin
Slide 22: Solutions Business
Solutions Business 21 = Pccw’
Slide 23: Increasing IT Demand from Diverse Business Sectors
Increasing IT Demand from Diverse Business Sectors More companies outsource their IT : reliable, cost efficient, never out-dated As a market leader in HK and China, PCCW Solutions benefits from this trend Experienced strong demand from increasingly diverse sectors • HK Police – mission critica
Slide 24: Solid Business Momentum
Solid Business Momentum Total secured backlog increased to US$647M at end of June 2012, creating need for additional infrastructure and human resources Hong Kong’s data center capacity utilization increased from 86% to 95% To meet customer demand, secured 97,000 sq ft. space to build new data
Slide 25: Capture Market Opportunities with Growth Drivers
Capture Market Opportunities with 3 Growth Drivers Connecting Support large Mainland customers like to expand into China to the international markets and to enhance operation efficiency with world-class World software and MNC customers like for their China operations 193 New task force to build tail
Slide 26: Solid Financial Performance
Solid Financial Performance (US$ million) Core Business* H1’11 H1’12 % change Revenue 1,402 1,418 + 1% EBITDA 453 471 + 4% Profit Attributable to Equity Holders 100 106 + 6% * Core business includes HKT, Media and Solutions Businesses 25