Telkom Sa Soc Ltd. · JSE:TKG
Telkom Sa Soc — Telkom — H1 2007 Earnings Presentation
22 slides from Telkom Sa Soc's earnings presentation, Dec 4, 2006
Slide 1: A Culture of Mobility: Interim results for six months ended September 30, 2006
Exhibit 99.6 A CULTURE OF MOBILITY Vodacom Group (Proprietary) Limited Interim results for the six months ended September 30, 2006 November 13, 2006 Content Alan Knott-Craig Chief Executive Officer Operational highlights Leon Crouse Chief Financial Officer Financial review
Slide 2: Group highlights
Operational highlights Alan Knott-Craig Chief Executive Officer Group highlights For the six months ended September 30, 2006 vs. the same period in the previous financial year Total customers (SIM cards) Revenue Profit from operations 25.8 million R19.5 billion R5.0 billion 34.7% 20.3% 17.5% EBITDA
Slide 3: Acquisitions; South Africa
Acquisitions Increased interest in equity of Smartphone SP (Pty) Ltd and its subsidiaries from 51% to 70%, on August 30, 2006 Effective September 13, 2006, Vodacom Service Provider (Pty) Ltd acquired the contract customer base of approximately 160 thousand from Smartcom (Pty) Ltd An offer to increas
Slide 4: South Africa market and operational indicators
Increase in prepaid churn to 47.7% due to 2.4 million additional prepaid SIM card deletions South Africa market estimated at 48 million by 2012 Vodacom strategically placed for South Africa market share continued market leadership Lowest cost operator Extensive distribution Strong brand Strong focus
Slide 5: South Africa ARPU; 3G, HSDPA and Vodafone live!
South Africa ARPU Contract ARPU decreased South Africa ARPU per month 10.2% year on year to R528 Prepaid ARPU decreased 14.1% year on year to R61 Total ARPU decreased 15.6% year on year to R124 Lower incoming revenue per customer Lower average usage Customer mix 3G, HSDPA and Vodafone live! 3G / HSD
Slide 6: Mobile TV; Regulatory and legal
Mobile TV Convergence of Broadcasting and Telecoms Access to content very important MobileTV technologies 3G MBMS DVB-H Trial DVB-H, together with Multichoice Regulatory and legal Customer registration The final act will be ready during 2007. It is likely to depress growth Mobile number portability
Slide 7: Tanzania; Democratic Republic of Congo
Tanzania Customer market share 55% Population 37.4 million, penetration 12.6% % H1 2006 H1 2007 change Total customers 1.6 million 2.6 million 61.5% Revenue R611 million R775 million 26.8% Profit from operations R115 million R134 million 16.5% ARPU R73 R53 27.4% Customers per employee 4,330 5,379 24
Slide 8: Lesotho; Mozambique
Capex as a % of revenue 21.6% 29.9% 8.3% pts Penetration increasing 2.7% points General upswing in economy despite election uncertainties Lesotho Customer market share 80% Population 2.0 million, penetration 14.7% % H1 2006 H1 2007 change Total customers 171 thousand 238 thousand 39.2% Revenue R77 m
Slide 9: Way forward
Capex per customer R1,886 R1,207 36.0% Capex as a % of revenue 104.1% 45.2% 58.9% pts Competitive network coverage and quality Significant growth in customers Loss from operations includes an impairment of R38.2 million in H1 2007, compared to an impairment reversal of R68.4 million in H1 2006 Way f
Slide 10: Group income statements; Group revenue
Chief Financial Officer Group income statements Extracts for the six months ended September 30, % R million H1 2005 H1 2006 H1 2007 change Revenue 13,231 16,175 19,466 20.3% Operating expenses excluding depreciation, amortisation and impairment (9,042) (10,612) (12,888) (21.4%) EBITDA 4,189 5,563 6,
Slide 11: Group revenue
13,231 16,175 19,466 20.3% Revenue driven by strong customer growth Other African operations contributed 9.7% (H1 2006: 8.7%) Group revenue Revenue composition % R million H1 2005 H1 2006 H1 2007 change Airtime, connection and access 7,823 9,581 11,313 18.1% Data revenue 586 893 1,443 61.6% Intercon
Slide 12: Group revenue excluding equipment sales; Data revenue growth
Airtime contribution down 1.1% points; revenue up 18.1% to R11.3 billion Interconnect contribution down 0.6% points; revenue up 16.9% to R3.7 billion Net interconnect revenue up 6.1% to R1.1 billion Data contribution up 1.9% points; revenue up 61.6% to R1.4 billion Group revenue (excluding equipment
Slide 13: EBITDA and margin analysis; Group operating expenses
30.0% 40.9% year on year on year year South Africa data revenue up 64.1%, due to availability of handsets and new technologies (3G, HSDPA, Vodafone live!, BlackBerry®, Mobile TV) Tanzania data revenue up 30.0% due to customer growth and increased data spend by customers EBITDA and margin analysis EB
Slide 14: Group operating expenses; Group profit from operations
Direct network operating cost contribution up by 0.6% points; costs up 22.4% to R8.0 billion Payments to other operators contribution up 0.3% points; costs up 23.4% to R2.7 billion Depreciation, amortisation and impairment contribution down 0.1% points; costs up 20.6% to R1.6 billion. Net impairment
Slide 15: Profit from operations and margin
DRC 7 47 133 183.0% Lesotho 9 26 34 30.8% Mozambique (341) (25) (138) (>200.0%) Holding companies 33 2 57 >200.0% 2,534 4,225 4,965 17.5% Profit from operations margin (%) 19.2% 26.1% 25.5% 0.6% pts Customer growth of 34.7% to 25.8 million Revenue growth of 20.3% vs. operating expenses growth of 21.
Slide 16: Factors affecting trends and margins (continued)
increased 5.0% year on year to R1.0 billion Margin dropped by 3.4% pts to 32.1% Gross South Africa customer connections of 5.3 million Prepaid customer connections of 4.9 million; an increase of 27.5% year on year South Africa net interconnect 5.0% year on Contract customer connections of 0.3 millio
Slide 17: Productivity measures; Capex additions and composition
R147 to R124 per month South Africa contract ARPU per month Contract ARPU decreased by 10.2% year on year from R588 to R528 per month Productivity measures Consolidated gross capex as a % of Gross capex additions as a % of revenue revenue increased to 16.1% from 15.3% for the same period in the prev
Slide 18: Cash; Net debt maturity profile
Capex as a % of revenue at 16.1% vs. prior year of 15.3% South Africa capex gross additions increased 16.2% to R2.5 billion Other African capex additions increased 85.8% to R0.6 billion Cash Cash generated from operations Cash generated from operations increased 10.8% to R5.5 billion year on year Fr
Slide 19: Debt composition; Shareholder distributions
R million Total Total September 30, 2007 2008 2009 2010 2011 >2012 2006 2005 South Africa – finance leases 95 134 168 114 164 98 773 836 Tanzania 163 118 - - - - 281 326 DRC 307 - 1,381 - - - 1,688 1,421 Lesotho - 1 1 1 - - 3 4 Debt excluding bank overdrafts 565 253 1,550 115 164 98 2,745 2,587 Bank
Slide 20: Questions?
Excluding interest on shareholders’ loans The level of future dividend payments is dependent on the extent of investment activities Questions?
Slide 21: Group balance sheets; Group cash flow statements
Group balance sheets Extracts as at March % R million H1 2006 2006 H1 2007 change ASSETS Non-current assets 15,184 16,079 18,524 15.2% Current assets 10,173 8,689 8,062 (7.2%) Total assets 25,357 24,768 26,586 7.3% EQUITY AND LIABILITIES Equity 8,736 8,672 9,368 8.0% Non-current liabilities 2,140 2,
Slide 22: Disclaimer
Disclaimer This presentation has been prepared and published by Vodacom Group (Proprietary) Limited. Vodacom Group (Proprietary) Limited is a private company and as such is not required by the Companies Act 61 of 1973, as amended, to publish its results. Vodacom Group (Proprietary) Limited makes no