Elisa Oyj Class A · OMXHEX:ELISA

Elisa Oyj Class A — Q3 2002 Earnings Presentation

30 slides from Elisa Oyj Class A's earnings presentation, Nov 1, 2002

  1. Slide 1: Elisa Communications Interim Report

    Elisa Communications Interim Report 1 July 2002 – 30 September 2002

  2. Slide 2: Contents

    Contents „ July – September in brief, and the outlook for the rest of the year „ CEO Matti Mattheiszen „ Group key figures and financial situation „ CFO Vesa-Pekka Silaskivi „ Performance of Business Areas „ Group Spokesman Pekka Perttula 1.11.2002 2

  3. Slide 3: Q3 2002 Group Highlights

    Q3 2002 Group Highlights „ The Group produced EUR 32m positive cash flow* „ The positive development of operative cash flow will continue during Q4 2002 and throughout 2003 „ Further CAPEX reductions, CAPEX per sales was 14% (34%) „ Full year operative CAPEX target is now set at EUR 225m, of which E

  4. Slide 4: Business Highlights

    Business Highlights „ Overview of the Group’s business „ The positive business development of the Group was affected by exceptional market conditions and strongly increased annual pension expenses „ The Group implemented its restructuring programme „ Non-core divestments, adjusted CAPEX programme, c

  5. Slide 5: Synergy and Savings Potential

    Synergy and Savings Potential Investments 5% Overlapping CAPEX Additional sales 10% Geographical and large Improved return on accounts sales capital employed 7% Purchasing Networks and colocation power 8% Network services Buy-backs of leasing liabilities 16% Technology 31% Network optimisation New g

  6. Slide 6: Future Outlook

    Future Outlook „ In line with previous guidance, the Group's revenue for the whole of 2002 is expected to grow faster than the market in general „ In line with previous guidance, EBITDA exclusive of one-off items is estimated to grow compared to the fiscal year 2001 „ Cash flow is estimated to remai

  7. Slide 7: Key Figures and Financial Situation

    Key Figures and Financial Situation

  8. Slide 8: Q3 2002 Financial Highlights

    Q3 2002 Financial Highlights „ Revenue and profitability remained at H1 level „ Group figures were affected by changes in domestic competitive environment, additional pension costs and a difficult IT market „ Financial position remained solid „ Group cash flow was positive „ Net debt has been decrea

  9. Slide 9: Key Figures of Elisa Group Q3 2002

    Key Figures of Elisa Group Q3 2002 Excluding one-off items EUR million Q3/02 Q3/01 change Q3/02 Q3/01 change Revenue 388 389 0% 388 389 0% EBITDA 51 91 -44 % 84 90 -7 % EBIT -43 16 - 6 21 -71 % Pre Tax Profit -56 -1 - -7 4 - „ Without one-off items EBITDA was EUR 84m and EBIT EUR 6m „ One-off items

  10. Slide 10: CAPEX by Quarters

    CAPEX by Quarters 250 200 EUR million 150 141 21 42 100 38 4 2 5 50 85 111 101 76 68 70 50 0 Q1/01 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 Q3/02 Investments in shares Investments in fixed assets Investments in fixed assets include Radiolinja’s buy-backs of leasing liabilities 1.11.2002 10

  11. Slide 11: Depreciations by Quarters

    Depreciations by Quarters 100 48 38 EUR million 5 17 16 2 3 11 14 16 14 11 50 11 12 58 66 60 64 64 44 45 0 Q1/01 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 Q3/02 One-off write-down Depreciation of goodwill Depreciation of fixed assets 1.11.2002 11

  12. Slide 12: EUR 77m Non-recurring Provision of GSM Leasing Liabilities

    EUR 77m Non-recurring Provision of GSM Leasing Liabilities „ The Group’s management has evaluated the value of the leasing liabilities based on the statements in Q2 2002 report (changes in technology, rearrange of agreements) and decided to make a non-recurring provision „ No cash flow effect „ Tax

  13. Slide 13: Pension Fund Liabilities are Fully Covered

    Pension Fund Liabilities are Fully Covered „ Statutory pension cover is arranged by the Pension Funds of Elisa Group or with pension insurance companies „ If the stock market performance is flat, total pension cost could be EUR 16m higher in 2002 than in 2001 (Jan-Sep 2002 EUR 9m, of which EUR 3m in

  14. Slide 14: Cash Flow from Operations is Positive

    Cash Flow from Operations is Positive 40 30 20 EUR million 10 0 -10 -20 -30 -40 Q1/01 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 Q3/02 Cash flow from operations* * Cash flow from operations = clean EBITDA – net financial items – CAPEX (excl. GSM network buy-backs) 1.11.2002 14

  15. Slide 15: Net Debt Reduction in Progress

    Net Debt Reduction in Progress Consolidation of Tropolys companies Sale of Instalia and change in debt business 900 reserving Sale of Elisa Management 850 directory target for the business year-end 800 (incl. sale of Soon and 750 Yomi directories) 700 650 600 550 500 Q1/01 Q2/01 Q3/01 Q4/01 Q1/02 Q2

  16. Slide 16: Performance of Business Areas

    Performance of Business Areas

  17. Slide 17: Elisa Mobile Q3 2002

    Elisa Mobile Q3 2002 Elisa Mobile Revenue EBITDA EBIT Service- and Q3/02 Q3/01 change Q3/02 Q3/01 change Q3/02 Q3/01 change network operators 178 175 2% -30 58 - -68 36 - Distribution companies 12 14 -14 % 3 -1 - 4 -2 - Intra-SBA sales -2 -4 One-time items 77 89 3 Group bookings -10 -9 Total excl. o

  18. Slide 18: Elisa Mobile (cont.)

    Elisa Mobile (cont.) Radiolinja's key figures Q3/2002 Q3/2001 % 2001 Clean EBITDA 50 57 -12 % 224 Leasing adj. EBITDA 57 70 -18 % 275 CAPEX 16 70 -78 % 242 Subscriptions in Finland * 1 301 621 1 295 280 0% 1 356 204 ARPU ** 43 44 -2 % 43,5 Churn ** 14,0 % 15,5 % 14,3 % Minutes of use, million * 521

  19. Slide 19: Fixed Network Business Q3 2002

    Fixed Network Business Q3 2002 Fixed network Revenue EBITDA EBIT Q3/02 Q3/01 change Q3/02 Q3/01 change Q3/02 Q3/01 change Service operator 170 15 0 Network operator 77 78 64 Intra-SBA sales -70 One-time items -36 -36 Group bookings 0 0 Total excl. one-offs 177 209 -15 % 57 59 -3 % 28 27 4% Revenue,

  20. Slide 20: Fixed Network Business (cont.)

    Fixed Network Business (cont.) Subcriptions Q3/2002 Q3/2001 Change ISDN channels 249 700 271 600 -8 % Broadband channels 59 000 19 400 204 % Cable TV 143 700 128 800 12 % Analogue and others 689 300 733 900 -6 % Total 1 141 700 1 153 700 -1 % „ The Group and its associated companies have about 165 0

  21. Slide 21: Germany-based Operations Q3 2002

    Germany-based Operations Q3 2002 Net result (incl. Germany Revenue EBITDA minority share) Q3/02 Q3/01 Q3/02 Q3/01 Q3/02 Q3/01 Carrier-business 31 11 -9 -6 -13 -11 Mäkitorppa GmbH 0 3 0 -3 0 -4 One-time items Group bookings Total excl. one-offs 31 14 -9 -9 -13 -15 Revenue, EUR million EBITDA / revenu

  22. Slide 22: Germany-based Operations (cont.)

    Germany-based Operations (cont.) „ The portfolio has been restructured sooner than planned „ Q3 includes EUR -2.5m non-recurring restructuring cost „ Result also includes EUR -1.4m consolidation effect on EBITDA (TIMe CityLink) „ Underlying EBITDA was EUR -4.9m in Q3 „ Net loss decreased to EUR -12.

  23. Slide 23: Germany-based Operations (cont.)

    Germany-based Operations (cont.) „ The amount of new business customers and ARPU exceeded the objectives 14,5 375 35 Business cust., thousends 370 0 14 30 365 1 0,3 7 Mäkitorppa ARPU, EUR/month 13,5 25 6 Revenue EURm 6 GmbH 360 13 355 20 9 Carrier 8 Customers 350 8 12,5 15 SoHo 345 12 10 Customers 3

  24. Slide 24: Elisa Communications Interim Report

    Elisa Communications Interim Report 1 July 2002 – 30 September 2002

  25. Slide 25: Appendix

    Elisa Communications Interim Report Appendix 1 July 2002 – 30 September 2002

  26. Slide 26: Elisa Group's Q3 2002 P&L

    Elisa Group’s Q3 2002 P&L Elisa Communications Group Excl. one-off items * EURm Q3/02 Q3/01 Q3/02 Q3/01 Revenue 388 389 388 389 Other income from operations 46 4 3 3 EBITDA 51 91 84 90 EBITDA margin 13 % 23 % 22 % 23 % Depreciation -80 -64 -64 -58 Goodwill depreciation -14 -11 -14 -11 EBIT -43 16 6

  27. Slide 27: Key Figures of Elisa Communication

    Key Figures of Elisa Communication Elisa Group Q3/02 Q2/02 Q1/02 Q4/01 Q3/01 Q2/01 Q1/01 EURm Revenue 388 406 384 386 389 331 333 EBITDA 51 86 78 183 91 75 76 EBITDA-% 13 % 21 % 20 % 47 % 23 % 23 % 23 % Clean EBITDA 84 86 86 97 91 77 68 Clean EBITDA-% 22 % 21 % 22 % 25 % 23 % 23 % 20 % EBIT -43 -32

  28. Slide 28: Key Figures (cont.)

    Key Figures (cont.) Business Areas Q3/02 Q2/02 Q1/02 Q4/01 Q3/01 Q2/01 Q1/01 Elisa Mobile ARPU, EUR 43,0 43,5 41,4 42,7 44,2 45,3 42,2 Churn, % 14,0 12,7 18,2 14,4 15,5 13,9 13,9 Subscriptions 1 301 621 1 289 016 1 348 710 1 356 204 1 295 280 1 281 577 1 392 000 EBITDA 50 55 52 47 58 47 46 EBITDA-%

  29. Slide 29: Reconciliation of Clean EBITDA and EBIT

    Reconciliation of Clean EBITDA and EBIT EURm Q3/2002 Sales 388 Other income 46 Opex -383 EBITDA 51 Capital gains -44 1) One-time cost booking 77 2) Clean EBITDA 84 Depreciation -80 Goodwill depreciation -14 Write-down for Radiolinja 12 3) Write-down for other companies business 4 4) Clean EBIT 6 1)

  30. Slide 30: Revenue, EBITDA and EBIT, and Clean EBITDA and EBIT by Business Areas, EURm

    Revenue, EBITDA and EBIT, and Clean EBITDA and EBIT by Business Areas, EURm Elisa Mobile Revenue EBITDA EBIT Clean EBITDA Clean EBIT Service- and Q3/02 Q3/01 Q3/02 Q3/01 Q3/02 Q3/01 Q3/02 Q3/01 Q3/02 Q3/01 network operators 178 175 -30 58 -68 36 47 58 21 39 Distribution companies 12 14 3 -1 4 -2 3 -

Elisa — Q3 2002 Earnings Presentation on 6ix