35 slides from VEON Ltd. ORD's earnings presentation, Sep 7, 2011
Slide 1: 2Q 2011 Presentation
2Q 2011 P Presentation t ti Jo Lunder, CEO Amsterdam, September 7, 2011
Slide 2: Disclaimer
Disclaimer This presentation contains "forward-looking statements", as the phrase is defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements relate to the p y strategy, Company's gy, development p plans and anticipated p p perform
Slide 3: Key messages
Key messages Second quarter results • Solid revenue and subscriber growth • Solid performance in all Business Units • Long-term financing secured • Delivering synergies ahead of plan in Kyivstar • Integration of Wind Telecom and VimpelCom well on track • I t i di Interim dividend id d 2011 off USD 0
Slide 4: Group Highlights
Group Highlights Jo Lunder, CEO 4 © VimpelCom Ltd 2011
Slide 5: Organizational Structure
Organizational Structure Management team with strong track records Group Executive Board Jo Lunder CEO Khaled Bichara Henk van Dalen President and COO CFO Philip Tohme Khaled Bichara CTO C O Acting ct g CCO Business Unit Management Elena Ossama Ahmed Igor Dmitry Shmatova Bessada Abou Doma Lytovchenk
Slide 6: 2Q11 Highlights
2Q11 Highlights Key Results and Developments Strategic Progress • Mobile subscribers 193 million, up 11% YoY* • Acquisition Wind Telecom closed • Total fixed-line subs 5 million, up 22% YoY* • Strengthened position in Far East of Russia • Revenues of USD 6.0 billion, up 9%YoY* • Strong growth mobile
Slide 7: Financial Highlights
Financial Highlights Henk van Dalen, CFO 7 © VimpelCom Ltd 2011
Slide 8: 2Q11 Actual Financial Highlights
2Q11 Actual Financial Highlights Consolidated financial and operating highlights (USD million) USD mln Actual 2Q11 2Q10 YoY Net operating revenues 5,532 2,642 109% EBITDA 2,184 1,260 73% EBITDA margin 39.5% 47.7% N t income Net i attributable tt ib t bl tto VimpelCom Vi lC Ltd Ltd. 239 335 -29% 29%
Slide 9: 2Q11 Pro Forma Financial Highlights
2Q11 Pro Forma Financial Highlights Revenues EBITDA (USD million) (USD million) +9% YoY Stable YoY 2,368 2,435 2,371 2,266 2,257 6,008 5,519 5,633 5,488 5,481 43.1% 44.1% 40.2% 41.2% 39.5% Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 EBITDA EBITDA Margin CAPEX Highlights: (USD mil
Slide 10: Debt, Cash and Ratios
Debt, Cash and Ratios Consolidated Cash and Net Debt Development Key Components Actual H1 2011 (USD million) 3 289 27 393 (USD million) June 30, 30 930 500 109 24 104 2011 18 563 Cash and Cash Equivalents 3,190 Total Assets 58,873 Gross Debt , 27,392 -Short-term 1,637 -Long-term 25,756 5 661 (921) 4
Slide 11: Debt Composition and Maturity Profile
Debt Composition and Maturity Profile Group Debt Maturity Schedule as of June 30, 2011, Actual (USD million) 9 621 9,621 5,116 2,454 2,251 1,968 1,408 1,500 1,276 1,242 1,000 2HY 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2011 WIND Italy VIP/OJSC Other Debt Composition by Currency
Slide 12: Interim Dividend 2011 Declared
Interim Dividend 2011 Declared Interim dividend 2011 of USD 733 million, USD 0.45 per share • The record date for the Company’s shareholders entitled to receive the interim dividend has been set for December 1, 2011 Dividend guideline* • Aim to pay at least USD 0.80 per common share, assuming not mo
Slide 13: Business Units Performance
Business Units P f Performance Khaled Bichara, President and COO 13 © VimpelCom Ltd 2011
Slide 14: BU Russia: Financial Highlights
BU Russia: Financial Highlights Revenues EBITDA and EBITDA Margin (RUR billion) (RUR billion) +6% YoY -7% YoY 64.3 64.5 65.2 30.2 61.7 60.4 29.1 28.0 25.4 27.1 9.9 10.5 10.7 10.8 10.3 47.2% 47.0% 43.4% 42.1% 41.5% 51 8 51.8 53.8 53.8 50 1 50.1 54.4 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q2 10 Q3 10 Q4 10 Q1
Slide 15: BU Russia: Operating Highlights
BU Russia: Operating Highlights Mobile subscribers ARPU and MOU (million) (RUR) (min) +9% YoY - 1% YoY ARPU +11% YoY MOU 55.3 343 330 333 327 308 53.0 51.6 52.0 244 50.9 219 222 228 218 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 ARPU MOU Broadband subscribers Broadband ARPU (mil
Slide 16: BU Europe & NA: Financial Highlights Italy
BU Europe & NA: Financial Highlights Italy Revenues* EBITDA* and EBITDA Margin (EUR million) (EUR million) -1% YoY reported -5% YoY reported +1% YoY organic g Stable YoY organic g 556 557 534 496 526 366 341 408 369 370 39% 41% 1 046 1,046 1 021 1,021 1 038 1,038 982 1 029 1,029 37% 37% 38% Q2 10 Q3
Slide 17: BU Europe & NA: Operating Highlights Italy
BU Europe & NA: Operating Highlights Italy Mobile subscribers ARPU and MOU (million) (EUR) (min) +7% YoY -7% YoY 20.6 20.3 17.2 16.8 16.5 16.0 15.4 19.9 19.6 191 187 198 185 183 19.3 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 ARPU MOU Broadband subscribers Broadband ARPU (millio
Slide 18: BU Africa & Asia: Financial and Operating Highlights
BU Africa & Asia: Financial and Operating Highlights Revenues EBITDA and EBITDA Margin (USD million) (USD million) +5% YoY +8% YoY 949 385 404 407 910 377 901 895 891 337 45.3% 41.8% 42.3% 42.9% 37 7% 37.7% Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 EBITDA EBITDA Margin CAPEX Hi
Slide 19: BU Ukraine: Financial and Operating Highlights
BU Ukraine: Financial and Operating Highlights Revenues EBITDA and EBITDA Margin (UAH billion) (UAH billion) +7% YoY +9% YoY 1.9 1.8 3.4 1.6 1.7 1.6 3.3 3.2 53.6% 56.0% 53.8% 54.0% 54.8% 3.1 3.0 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 EBITDA EBITDA Margin CAPEX Highlights: (U
Slide 20: BU CIS: Financial and Operating Highlights
BU CIS*: Financial and Operating Highlights Revenues EBITDA and EBITDA Margin (USD million) (USD million) +16% YoY +9% YoY 389 175 362 362 351 161 160 155 159 336 41 41 41 41 39 47.9% 45.3% 44.4% 42.7% 45.0% 291 321 321 310 348 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Mobile F
Slide 21: Global Scope, Local Excellence
Global Scope, L Local l Excellence E ll Jo Lunder, CEO 21 © VimpelCom Ltd 2011
Slide 22: VimpelCom Today
VimpelCom Today Revenue Emerging market exposure Russia It l Italy Other Mobile subs (million) 192 28% 38% Population covered Attractive USD Balanced (million) 864 Emerging 22 6bn* 22.6bn* Revenue Markets Base Countries 19 Exposure 34% Emerging 750** Market PoP Broadband/Data revenue Financial Param
Slide 23: Expected Synergies Reaffirmed
Expected Synergies Reaffirmed Current status Communicated (USD billion) Next phase Target First phase Secured 2.5 1.6 35% Approx. NPV of USD2 5b USD2.5bn First phase 65% • Savings through harmonization current price levels • Cost benchmarking Next phase • Implement best practices on global categorie
Slide 24: Three Strategic Clusters Recognized
Three Strategic Clusters Recognized I II III A Algeria A Kazakhstan Canada Russia Armenia, Tajikistan, Georgia B Vietnam B Ukraine Laos C Cambodia b di Pakistan Italy Bangladesh Burundi CAR Zimbabwe Uzbekistan, Kyrgyzstan Increase Profit and Cash Growth Engine Develop New Business • Large mature cou
Slide 25: Value Agenda 2012-2014
Value Agenda 2012-2014 Stakeholder Value Drive Profitable Growth Increase Reduce Costs and Increase Capital Free Cash Flow Realize Synergies y g Efficiency y YoY Attractive Dividend Yield Unified, Disciplined and Accountable Business Performance Culture Build World-Class Organization, Governance and
Slide 26: Conclusion
Conclusion Second quarter results • Solid revenue and subscriber growth • Solid performance in all Business Units • Long-term financing secured • Delivering synergies ahead of plan in Kyivstar • Integration of Wind Telecom and VimpelCom well on track • I t i di Interim dividend id d 2011 off USD 0.4
Slide 27: Q&A
Q&A Amsterdam, September 2011
Slide 28: Thank you
Thank you Amsterdam, September 2011
Slide 29: Contact Information
Contact Information Please find herewith all contact details of VimpelCom’s Investor Relations team: Gerbrand Nijman Investor_Relations@vimpelcom.com Tel: +31 20 79 77 200 (Amsterdam) Marine Babayan Russia, Ukraine and CIS Investor_Relations@vimpelcom.com T l +7 Tel: 7 495 974 5888 (Moscow) (M ) Noh
Slide 30: Appendices
Appendices 30 © VimpelCom Ltd 2011
Slide 31: A track record of delivering results
A track record of delivering results 2011: Chief Executive Officer of VimpelCom Ltd 2010 -2011: Chairman of the Board of Directors 2002-2011: Member of VimpelCom Board of Directors 2003-2005: Chairman of the Board of OJSC VimpelCom 1999 -2003: CEO of OJSC VimpelCom and General Director • Sustained g
Slide 32: FOREX Development
FOREX Development Average rates Closing rates Currency YTD11 YTD10 YoY YTD11 FY2010 Delta RUR 28.62 30.07 5.1% 28.08 30.48 8.5% EUR 1.40 1.32 -6.2% 1.45 1.34 -7.5% DZD 72.47 74.19 2.4% 72.06 74.29 3.1% PKR 85.40 84.81 -0.7% 85.97 85.67 -0.4% BDT 72 37 72.37 69 66 69.66 -3.7% 3 7% 74 15 74.15 70 60 7
Slide 33: Reconciliation Tables
Reconciliation Tables Reconciliation of consolidated EBITDA of VimpelCom USD mln Pro forma 2Q11 2Q10 YTD 2011 YTD 2010 EBITDA 2,371 2,368 4,628 4,583 Adjustment for certain non-operating items 8 3 10 5 Depreciation (892) (722) (1,731) (1,474) Amortization (342) (379) (700) (765) Impairment loss (9)
Slide 34: Reconciliation Tables
Reconciliation Tables Reconciliation of consolidated EBITDA of VimpelCom (continued) USD mln Actual 2Q11 2Q10 YTD 2011 YTD 2010 EBITDA 2,184 1,260 3,391 2,300 Adjustment for certain non-operating items 8 2 10 3 Depreciation (829) (377) (1,305) (729) Amortization (292) (117) (393) (183) Impairment lo
Slide 35: Reconciliation Tables
Reconciliation Tables Reconciliation of consolidated net debt of VimpelCom USD mln 2Q10 3Q10 4Q10 1Q11 2Q11 Net debt 3,865 3,970 4,740 4,840 24,104 Cash and cash equivalents (2,353) (2,467) (885) (1,858) (3,190) Long - term and short-term deposits (115) (56) (36) (592) (99) Long - term debt 4,801 4,