Hutchison Telecommunications Hong Kong Holdings Limited · HKEX:215
Hutchison Telecommunications Hong Kong — FY2017 Earnings Presentation
21 slides from Hutchison Telecommunications Hong Kong's earnings presentation, Feb 26, 2018
Slide 1: Keep Growing: 2017 Annual Results Presentation
Keep Growing 2017 Annual Results Presentation 26 February 2018
Slide 2: Disclaimer
Disclaimer Potential investors and shareholders (the “Potential Investors and Shareholders”) of Hutchison Telecommunications Hong Kong Holdings Limited (“the Company”) are reminded that information contained in this Presentation comprises extracts of operational data and financial information of the
Slide 3: Business Performance
LU] Hutchison Telecom oo Hong Kong Holdings
Slide 4: Remarkable achievements
Remarkable achievements • Stable customer service revenue in a very competitive market • Mobile customer number increased 3% YoY • Roaming revenue increased 6% (2H17 vs 1H17) • Profit attributable to shareholder was HK$4,766 million, increased ~6 times vs 2016 • Cash proceeds of HK$14.5 billion from
Slide 5: Steady mobile service revenue amid fierce competition
Steady mobile service revenue amid fierce competition Revenue ($’Billion) 4
Slide 6: Roaming revenue with signs of turnaround
Roaming revenue with signs of turnaround Revenue ($’Million) 6% 5
Slide 7: Steadily growing customer base
Steadily growing customer base Postpaid 0.1% Customer no. YOY +3% (2017 vs 2016) 0.3% Postpaid & Prepaid 1.8% 1.4% 4.7% Prepaid 3.3% 2.6% 8.7% 6
Slide 8: Mobile KPIs
Mobile KPIs Blended postpaid gross ARPU(1) and net ARPU(1) Postpaid Churn 2016 2017 2017 exit Gross ARPU Net ARPU 247 230 205 197 1.3% 1.3% 0.1 pts 1.2% steady 2016 2017 2016 2017 (Restated) (Restated) Note 1 Postpaid Gross ARPU = monthly average spending per postpaid user including handset contribu
Slide 9: Significant data growth on a super stable 4.5G network
Significant data growth on a super stable 4.5G network Data usage per active 4G customers TB/year 71% 2013 2014 2015 2016 2017 8
Slide 10: Forward looking technology development
Forward looking technology development 2100MHz RAN Modernisation Digitalisation Unified RAN equipment Personalized and cognitive enagagement with customers 256QAM (Quadrature Amplitude Modulation) New unified Mobile App “My3” Deployed to enhance overall speed by upto 30% A single unified interface t
Slide 11: Leadership in IoT for wider scope of revenue streams
Leadership in IoT for wider scope of revenue streams Commercialized NB-IoT network deployment • 900 MHz licensed spectrum band • Territory-wide deep coverage 3InnoCity (incubation program) • Develop and promote together • Innovative products & solutions based on NB-IoT • Accelerate HK’s development
Slide 12: Innovative marketing channels
Innovative marketing channels Facebook Performance 2016 2017 Social Media Campaign No. 1 Online video in 3HK history (viewership) No. 1 Online video in 2017* (viewership) No. 1 Top post in Jul 2017* 30% growth in no. of redemption for birthday offer Strengthen 3 Hong Kong’s brand image pro
Slide 13: Financial Performance
LU] Hutchison Telecom oo Hong Kong Holdings
Slide 14: Financials highlights
Financials highlights For the For the FY 2017 year ended year ended vs 31 December 2017 31 December 2016 FY 2016 HK$ million HK$ million Change (Restated) Service revenue 3,853 3,946 -2% Hardware revenue 2,899 4,386 -34% Mobile EBITDA (with JV) 1,339 1,397 -4% Mobile service EBITDA (with JV) 1,281 1
Slide 15: Mobile business
Mobile business 2017 2016 Favourable/ (unfavourable) HK$ million HK$ million Change Total mobile revenue 6,752 8,332 -19% - Net customer service revenue 3,853 3,946 -2% - Local service revenue 3,176 3,224 -1% - Roamingrevenue - Hardware service revenue 677 722 -6% - Hardware revenue 2,899 4,386 -34%
Slide 16: Enhanced operational efficiency
Enhanced operational efficiency • Lower customer acquisition cost with key Costs focus in retention activities 4,000 • Prudent control over operating expenses -2% 2,396 2,358 and staff cost HK$ million 325 277 • Network expenses well controlled despite 2,000 464 443 huge data traffic growth 1,607 1,
Slide 17: Highly disciplined capital expenditure
Highly disciplined capital expenditure Capex 700 20% 589 % to service revenue HK$ million 533 15% 14% 350 10% 0 0% 2016 2017 15.5% capex over service revenue 16
Slide 18: Solid net cash position
Solid net cash position • Net cash of HK$9.8 billion as at Dec Net (Debt)/Cash 2017 12,000 • Prepayment of external borrowing of HK$1.0 billion in October 2017 and 6,000 HK$3.9 billion in January 2018 9,817 HK$ million • Cash rich position for expansion 0 opportunities and 5G investment (4,110) -6,0
Slide 19: Outlook
LU] Hutchison Telecom oo Hong Kong Holdings
Slide 20: Strategies to meet the Challenges
Strategies to meet the Challenges Profitability and • Innovative lifestyle products – tailored to the needs Value Creation • Value creation to combat price competition • Leverage Shareholders’ global presence (in Europe, Asia, Australia and Japan) Customer First • Digitalise customer lifecycle for t
Slide 21: Thank You
Thank You
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