Vodacom Group Limited · JSE:VOD
Vodacom — Investor Presentation (February 2017)
28 slides from Vodacom's investor presentation, Feb 17, 2017
Slide 1: Vodacom Group Limited Investment case
Vodacom Group Limited Investment case February 2017
Slide 2: Disclaimer
Disclaimer The following presentation is being made only to, and is only directed at, persons to whom such presentations may lawfully be communicated (‘relevant persons’). Any person who is not a relevant person should not act or rely on this presentation or any of its contents. Information in the f
Slide 3: A leading African mobile communication company
• A leading African mobile communication company providing a wide range of communication services including mobile voice, messaging, data and converged services to over 65 million1 customers. Vodacom DRC Licenced 2002 Population 71 million Vodacom Tanzania • Vodacom is majority owned by Vodafone Plc
Slide 4: Share information
Share information As at 5 February 2017 Institutional shareholding1 JSE Ticker symbol VOD ADR code VDMCY 4% PIC = 51% Stock exchange JSE Limited 2% 8% Shares in issue 1 487 954 000 South Africa Freefloat 35% United States 52 week low and high R139 – R172 20% United Kingdom Rest of Europe Market capi
Slide 5: Five reasons to own Vodacom shares
Five reasons to own Vodacom shares 1 Market leadership 2 Focus areas of growth potential 3 Scale benefits driving efficiencies 4 Experienced, diverse management team 5 Track record of delivering shareholder returns Vodacom Group Limited IR presentation | 17 February 2017 5 5
Slide 6: #1 | Market leadership
#1 | Market leadership # 1 mobile operator in all markets 61.3 million customers in > 18 000 base stations, >80% 3G 5 countries in Sub-Saharan Africa 1st to launch 4G in South Africa, Lesotho and Tanzania R14 billion enterprise revenue from 30 countries in Africa R13 billion Investment per annum to
Slide 7: #2 | Focus areas of growth potential
#2 | Focus areas of growth potential FY14: +33% FY14: +24% FY15: +25% FY15: +10% Data (32% of Group service revenue) FY16: +29% International (27% of Group service revenue) FY16: +17% • Group: 29 million active data customers; 57% of total base • 27% of Group service revenue • SA: 14 million active
Slide 8: #3 | Scale benefits driving efficiencies
#3 | Scale benefits driving efficiencies Focussed savings programmes – Fit 4 Growth • Reduced transmission rentals through self-provisioning • Cost optimisation through sharing, outsourcing and supply chain management • Improved return on investment in customer acquisition spend • Reduced support co
Slide 9: #4 | Experienced, diverse management team
#4 | Experienced, diverse management team 4 CEO: Shameel Aziz Joosub (45) CFO: Till Streichert (41) 20 years industry experience 15 years industry experience Previously CEO of Vodafone Spain Previously CFO of Vodafone Romania IT Person of the year 2015 European and emerging market experience Executi
Slide 10: #5 | Consistently delivering shareholder returns
#5 | Consistently delivering shareholder returns Relative share price performance1 Dividend per share Cents per share 775 795 400 400 1. As at 15 February 2017. Total shareholder return2 Telkom 35.6% 375 395 395 Millicom 34.3% Bharti 15.1% FY15 FY16 FY17 Vodacom 6.3% Interim dividend Final dividend
Slide 11: Targets | Group medium-term targets
Targets | Group medium-term targets Service revenue growth Low to mid single-digit EBITDA growth Mid to high single-digit Capex intensity 12% to 14% 11 Vodacom Group Limited IR presentation | 17 February 2017 11
Slide 12: Continuing to deliver returns
Continuing to deliver returns Best network Diversify Deliver cost Best talent Transform --------------------- revenue to and process --------------------- society and Best value deliver growth efficiency Best practice build --------------------- stakeholder Best service trust Vodacom Group Limited I
Slide 13: Customer | Best network, Best value, Best service
Customer | Best network, Best value, Best service Best network Best value Best service • Network customer satisfaction #1 in all • Personalised pricing and offers • Connectivity markets but one • Driving pricing transformation • Always in control • 4G coverage in SA at 58% • Reducing communication c
Slide 14: Growth | Diversifying revenue to deliver growth
Growth | Diversifying revenue to deliver growth Data contribution International contribution FY16 • Growth +28.5% FY16 • Growth +17% • Average usage per smart • EBITDA contribution FY14 device - 572MB FY14 26.6% 17.7% (FY14: 15.6%) 31.9% • 2G to 3G; 3G to 4G 21.4% 24.6% • M-Pesa revenue +19% ARPU up
Slide 15: Operations | Fit for growth SA
Operations | Fit for growth SA 30.5% of SR4 6.6% of SR4 Number (FY15: 31.6%) (FY15: 6.7%) of sites +9% Direct expenses1 Staff expenses2 • Channel efficiencies • Hire in key growth areas • Sophisticated IBRO • Attract and retain talent management Actively managing costs Energy • Credit management inf
Slide 16: People | Attracting and retaining the best talent
People | Attracting and retaining the best talent Driving people transformation through Enhancing diversity Growing talent Developing skills • 73% black and 39% female • 123 graduates in 2015 • R103 million spent on skills staff Graduate programme development • 55% of EXCO black • International Grad
Slide 17: Reputation | Mobile for good
Reputation | Mobile for good R106m +600k Vodacom spent by TZN eSchool Vodacom subscribers: free education Foundation on Healthy portal 105k CSI projects pregnancy registered Healthy baby learners 20 24 hour 3 087 volunteers for call center for schools annual Change victims of connected - the World g
Slide 18: Reputation | BEE Level contributor
Reputation | BEE Level 2 contributor R841m R218m R112m spent on spent on spent on skills developing uplifting development SMME ICT communities businesses 98.25 Most empowered telco in 18 South Africa R7.2bn R5bn R26bn to >51% black- to >30% black weighted spend owned women-owned on BEE-status suppli
Slide 19: Additional information
Additional information Vodacom Group Limited IR presentation | 17 February 2017
Slide 20: Country data
Country data South Africa Tanzania DRC Mozambique Lesotho PopulationŦ (million) 55 55 71 29 2 GDP per capitaŦ (USD) 4 770 855 495 456 887 GDP growth estimateŦ 2016 (%) 0.7 6.5 5.0 4.8 2.0 Ownership (%) 93.75# 82.2 51 85 80 License expiry period 2029 2031 2028/2032µ 2018/2026µ 2036 Active customers (
Slide 21: Q3 results for the quarter ended December 2016
Latest | Q3 results for the quarter ended 31 December 2016 Sustained service revenue growth R million Dec 2016 Dec 2015 YoY % Δ • Group service revenue up 1.3% (4.4%*) Group • SA service revenue growth of 5.5% to R13 410 million Service revenue 17 443 17 162 1.3 • SA added just under 690 thousand cu
Slide 22: Annual results for the year ending March 2016
Annual results for the year ending 31 March 2016 Improved revenue growth and margins R million Mar 2016 Mar 2015 YoY % Δ • Group service revenue up 7.4% (5.8%*) Service revenue 66 763 62 167 7.4 • Group EBITDA up 12.8% (10.2%*) Revenue 80 077 74 500 7.5 • Headline earnings per share up 2.7% EBITDA 3
Slide 23: Five-year financials
Five-year financials for the year ended 31 March R million 2016 2015 2014 2013 2012 16/15 % Δ 5-year CAGR Service revenue 66 763 62 617 62 047 59 261 58 125 7.4 3.8 Revenue 80 077 74 500 73 219 67 781 65 700 7.5 5.1 EBITDA 30 345 26 905 27 314 25 253 22 763 12.8 7.5 Operating profit 21 059 19 235 20
Slide 24: Dividend policy and payment history
Dividend policy and payment history Current dividend payout is 90% of headline earnings per share The Company intends to pay out as much of its after tax profits as will be available after retaining such sums and repaying s uch borrowings owing to third parties as shall be necessary to meet the requ
Slide 25: Calendar | FY2017 plan
Calendar | FY2017 plan Reporting dates Roadshows/conferences Date Event Location Date Event Location 15 May FY 2017 results released Vodacom/Website 14 – 15 March Merrill Lynch conference Sun City FY 2017 integrated 28 March UBS Telco day Johannesburg 15 June Website report 18 July Group AGM Vodacom
Slide 26: Contact information
Contact information Visit our website for more information Follow us on social media @vodacom Facebook.com/vodacom Contact us VodacomIR@vodacom.co.za Shaun van Biljon (Head of Investor Relations) Revini Padayachi http://www.vodacom.com Sarah Chetty Faheem Moosa Vodacom Group Limited IR presentation
Slide 27: Definitions
Definitions Active customers Active customers are based on the total number of mobile customers using any service during the last three months. This includes customers paying a monthly fee that entitles them to use the service even if they do not actually use the service and those customers who are
Slide 28: Thank you
Thank you Vodacom Group Limited IR presentation | 17 February 2017
Vodacom Group — Investor Presentation (February 2017) on 6ix