Hutchison Telecommunications (Australia) Ltd
Hutchison Telecommunications (Australia) — FY2011 Earnings Presentation
19 slides from Hutchison Telecommunications (Australia)'s earnings presentation, Feb 24, 2012
Slide 1: ASX Announcement: Annual Results Presentation
Hutchison Telecommunications (Australia) Limited ABN 15 003 677 227 Level 7, 40 Mount Street North Sydney, NSW 2060 Tel: (02) 99644646 Fax: (02) 8904 0457 www.hutchison.com.au ASX Market Announcements Australian Securities Exchange Date 24 February 2012 Subject: Annual Results Presentation Please fi
Slide 2: Media Release: Hutchison Telecoms Announces Full-Year Results
Media Release Hutchison Telecoms Announces Full-Year Results Network investment on track Sydney, 24 February 2012: Hutchison Telecommunications (Australia) Limited (ASX: HTA) today announced results for the year ended 31 December 2011. The operational turnaround of Vodafone Hutchison Australia (VHA)
Slide 3: Media Release continued: Network sites, financing and synergies
Today, more than 1,000 sites are live on the new 3G 850MHz network and a total of 1,500 3G 850MHz sites are expected to be live across the Vodafone network in Q3 2012. Equipment has been replaced with new single Radio Access Network (RAN) equipment cross more than 4,000 sites. Service initiatives de
Slide 4: Welcome and results briefing introduction
Good afternoon and welcome to the full year results briefing for the year ended 31 December 2011 for Hutchison Telecommunications Australia. M name is My i Ni Nigell D Dews and d I’I’m th the CEO off V Vodafone d f H Hutchison t hi A Australia, t li th the business 50% owned by HTAL. In short, 2011
Slide 5: Operating summary and briefing agenda
The network performance continues to improve and the network roll- out remains on schedule. Service levels have also improved, with wait times and complaints down since the start of the year year. Our customer base declined over the year, but importantly our postpaid base returned to growth in the s
Slide 6: Basis of presentation: equity accounted VHA result
Thanks Nigel. As a reminder, the results we will present are an equity accounted result for HTAL’s investment in VHA. References to VHA financial results reflect the 50% share of VHA attributable to HTAL. References to customer metrics reflect the total active customer base of VHA, including MVNO cu
Slide 7: HTAL reported loss of $167.7 million for 2011
HTAL reported a loss of $167.7 million for the year ended 31 December 2011, compared to a profit of $73.4 million last year. The decline in HTAL’s profit was driven by a few factors: Firstly, a $12 million decrease in interest income following the repayment of loans by VHA during 2010. Secondly, a d
Slide 8: Total revenue and operating expenditure
....total revenue declined 4.7% year-on-year to $2.3 billion. The reduction in service revenue year-on-year flowed through to operating margin. HTAL’s share of VHA’s operating expenditure of $1.2 billion declined marginally year-on-year, with operating expenses reducing despite the increased network
Slide 9: Service revenue, operating margin and capital expenditure
....service revenue declined 7.1% year-on-year to just over $2 billion, reflecting the decline in the total customer base and ongoing average revenue per user (ARPU) challenges. Operating margin decreased 10.7% year-on-year as the increase in usage across all products pushed interconnection costs hi
Slide 10: $1.7 billion financing arrangement
In December 2011, VHA finalised a financing arrangement which included an extended loan facility of $1.7 billion. The facility is for a period of 5 years and demonstrates the support VHA has from its banks and shareholders. Some of the facility has already been used to repay part of the initial $3 b
Slide 11: Operating performance transition
Thanks Dave. While our financial results reflect the net impact of our operating challenges in 2011, the actions we have taken to address these challenges are beginning to turn our performance around. Now lets look at the operating performance in more detail. Turning first to our network. 8
Slide 12: Network improvement plans and rollout
The network performance and experience was our highest priority in 2011, as we accelerated our network investment plans. As a reminder, the key elements of our current network improvement plans were: 1. Rolling out a new 3G 850MHz network to improve in-building coverage and capacity; 2 2. Upgrading
Slide 13: Service metrics and new service initiatives
Over the year the service metrics have improved, and while there is still more work to do, wait times are down to normal levels and complaints have halved, so we are making good progress. We launched a number of new service initiatives, allowing customers to interact with us in different ways, inclu
Slide 14: Customer base, postpaid growth, churn and ARPU
....our base decline slowed in the second half and we finished the year with 7 million customers. Importantly, we added 16k postpaid customers in the second half to take our total postpaid base to 4.2 million. Our monthly postpaid handset churn remained high at around 2.0% in the second half, which
Slide 15: Data and smartphone customer growth
.....the number of customers using data on their handset increased 24% in the year to 2.7 million. The total number of customers (including MBB) using 3G services increased by half a million in the year to 3.5 million. The shift to smartphones continued, with more than half of VHA’s total handset ba
Slide 16: Customer acquisition cost improvement
Our acquisition cost per customer improved 6.9% for the year, falling from $145 last year to $135 reflecting the mix of plans and customers handset instalment payments. The result was achieved through better control of customer investment costs and importantly, the further impact of cost synergies f
Slide 17: Integration of 3 and Vodafone
The program to fully integrate ’3’ and Vodafone is tracking well with 90% of the integration projects complete and 85% of the integration savings delivered. A number of milestones were achieved during the year including the completion of the retail store consolidation. Our program to refit the store
Slide 18: 2012 outlook
We expect the operational turnaround to continue with further improvements anticipated during 2012. We will focus on steadily growing our customer base and expect the mobile market to remain highly competitive with significant pressure on ARPU’s as customers take up new plans. We are moving quickly
Slide 19: Summary and questions
In summary, this financial year will be an important year for us as we complete the network upgrade, introduce new service initiatives, attract valuable customers, deliver the remaining integration program projects and return to growth. Thank you. Now we’ll be pleased to take your questions. 16
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