Telekom Austria Ag · VIE:TKA

Telekom Austria — A1 Telekom Austria Group — Q2 2022 Earnings Presentation

37 slides from Telekom Austria's earnings presentation, Jul 12, 2022

  1. Slide 1: Results for the first half and the second quarter 2022

    Results for the first half and the second quarter 2022 Vienna, July 12, 2022

  2. Slide 2: Cautionary statement

    Cautionary statement 'This presentation contains forward-looking statements. These forward-looking statements are usually accompanied by words such as 'believe', 'intend', 'anticipate', 'plan', 'expect' and similar expressions. Actual events may differ materially from those anticipated in these forw

  3. Slide 3: Operational and financial highlights for the first half and the second quarter 2022

    Operational and financial highlights for the first half and the second quarter 2022 3

  4. Slide 4: Highlights for the second quarter 2022

    Highlights for the second quarter 2022 Group (in EUR million) Q2 2022 Q2 2021 % change Total revenues 1,208.4 1,165.8 3.7% Service revenues 1,025.7 976.4 5.0% EBITDA before restructuring* 477.1 448.6 6.3% CAPEX 211.1 238.1 -11.4%  Total revenues increased by 3.7%, driven by service  Increased mobi

  5. Slide 5: Austria and CEE markets in Q2 2022

    Austria and CEE markets in Q2 2022 Total revenues Service revenues EBITDA before restructuring (in EUR mn) (in EUR mn) (in EUR mn) +3.7% +5.0% +6.3% 36.9 1208.4 1165.8 9.9 12.1 39.9 1025.7 976.4 477.1 448.6 8.5 19.6 Revenues Austria CEE markets Revenues Service Austria CEE markets Service EBITDA Aus

  6. Slide 6: Austria: Solid EBITDA growth driven by higher service revenues despite some effects of cost inflation

    Austria: Solid EBITDA growth driven by higher service revenues despite some effects of cost inflation Total revenues Operational data (in EUR mn) Δ: +1.5%  Solid development in high-value as well as SIM-only segment.  5G tariffs continued to be sold with the premium over LTE tariffs; availability

  7. Slide 7: CEE: continued positive trends resulted in service revenues and EBITDA growth in almost all markets

    CEE: continued positive trends resulted in service revenues and EBITDA growth in almost all markets Highlights CEE EBITDA (in EUR mn; Q2 21%-change vs. PY) Bulgaria: Δ: +14.2% Δ: +2.7% Δ: +16.4%  Upselling to higher broadband speeds in the fixed-line, solid performance of the high value tariffs and

  8. Slide 8: 1-6M 2022: Free cash flow increased by 23.6% yoy

    1-6M 2022: Free cash flow increased by 23.6% yoy (in EUR million) Q2 2022 Q2 2021 % change 1-6 M 2022 1-6 M 2021 % change EBITDA 456.9 427.7 6.8% 888.5 826.0 7.6% Restructuring charges and cost of labor obligations 15.5 22.4 -30.8% 38.1 44.0 -13.5% Lease paid (principal, interest and prepayments) -3

  9. Slide 9: Focus Points

    V / VZ Focus Points V A -

  10. Slide 10: International markets: Growth story, successful strategy execution and synergies achieved

    International markets: Growth story, successful strategy execution and synergies achieved Encouraging International Markets’ Consistently applied Financial & operational development Synergies between A1 Group & CEE CAGR CAGR Mobile core 5G EUR bn EUR bn + 4.1% + 6.4% One entertainment tariffs in pla

  11. Slide 11: Focus on People Sustainability – Providing a work environment with Fairness, Dignity, Respect and Security

    Focus on People Sustainability –Providing a work environment with Fairness, Dignity, Respect and Security From Diversity to People Sustainability What we have achieved  Diversity, Equity& Inclusion Policy introduced People Sustainability  Human Rights Policy published Employment Health, Safety Lea

  12. Slide 12: Outlook for the full year 2022

    Outlook for the full year 2022 12

  13. Slide 13: Outlook for the full year 2022 - confirmed

    Outlook for the full year 2022 - confirmed July 12, 2022 Consensus 2022 Total revenues Close to 3% EUR 4,855 mn (+2.2% vs FY ’21) CAPEX Approx. 15% y-o-y EUR 946 mn (+14.4% vs FY ‘21)* *CAPEX consensus excl. spectrum  Total revenue growth expected to be driven by ongoing solid service revenue trend

  14. Slide 14: Appendix 1: ESG

    Vv / Vz Appendix 1 7 ESG A’ |

  15. Slide 15: One.Strategy

    One.Strategy “Environmental, Social & Corporate Governance (ESG)” was introduced as Strategy Enabler The A1 Telekom Austria Group aims to foster more efficient, resource- preserving and thus more sustainable ways of working and living. Results for the first half and the second quarter 2022 15

  16. Slide 16: ESG Strategy – Enabling the potential of digitalization for climate, people and society

    ESG Strategy – Enabling the potential of digitalization for climate, people and society Targets – our ambition Climate & Environment - Ambition 2030 E  Reach net carbon neutrality by decreasing the own carbon footprint & switching to energy from renewables 1  Increase energy efficiency by 80% 2 

  17. Slide 17: The 'E' of ESG

    The ‚E‘ of ESG CO2-emission 2030  More than 100 mobile base stations powered by self-generated electricity from wind or Reach net carbon neutrality from own solar power operations by  Phase-out of diesel generators  decreasing the own carbon footprint and  Increase in group-wide share of renewab

  18. Slide 18: The 'S' of ESG

    The ‘S’ of ESG  Since 2011 over 261,000 participants within 15,000 workshops (group-wide) Digital Education 2023 To address 100,000 people – especially children and young people – as part of the  “A1 Internet for All” became the new “A1 digital.campus” in 2021, with a focus on robotics, focus on d

  19. Slide 19: The 'G' from ESG

    The “G” from ESG  Strong tone-from-the-Top Compliance messages Maintain a best-practice and externally  Focus on sanction checks in connection with the Ukraine war certified compliance management  Our humanitarian aid for Ukrainian refugees led to an increase in donations system to safeguard the

  20. Slide 20: ESG KPIs

    ESG KPIs 2020 2021 Change Environment* CO2-emissions (in t)** 246,990 197,656 -20% E Energy efficiency (in Mwh/Terabyte) 0.14 0.11 -18% 84,880 (only Old devices recycled (No.) mobile) 166,038 n.a. Digital Education*** Participations in media literacy trainings (no.) 9,239 33,190 +259% S Number of Wo

  21. Slide 21: ESG Milestones & Goals

    ESG Milestones & Goals Relevant milestones reached ... ... and ambitious goals to achieve Social & Governance Launch Strategy will be extended to Climate targets were Alignment in CO2 “People Sustainability Materiality Analysis to approved by the Science- reporting process & first Strategy” expandin

  22. Slide 22: Appendix 2: Additional information on KPIs and financials

    Appendix 2 Additional information on KPIs and financials 22

  23. Slide 23: A1 Telekom Austria Group: The leading regional communications player

    A1 Telekom Austria Group: The leading regional communications player providing convergent telecommunication services as of June 30, 2022 (in ‘000) Austria Bulgaria Croatia Mobile market position #1 Mobile market position: #1 Mobile market position #2 Mobile subscribers: Mobile subscribers: Mobile su

  24. Slide 24: A1 Telekom Austria Group: Profit and Loss

    A1 Telekom Austria Group: Profit and Loss (in EUR million) Q2 2022 Q2 2021 % change Service Revenues 1,025.7 976.4 5.0% Equipment Revenues 161.6 166.8 -3.1% Other operating income 21.1 22.6 -6.5% Total Revenues 1,208.4 1,165.8 3.7% Cost of Service -347.5 -329.2 -5.5% Cost of Equipment -156.1 -162.8

  25. Slide 25: A1 Telekom Austria Group: Total revenues & costs and expenses per segment

    A1 Telekom Austria Group: Total revenues & costs and expenses per segment Total Revenues (in EUR million) Q2 2022 Q2 2021 % change Austria 676.1 666.2 1.5% Bulgaria 151.3 145.1 4.3% Croatia 113.3 108.7 4.2% Belarus 106.8 95.7 11.6% Slovenia 53.2 51.2 4.0% Serbia 85.7 74.7 14.7% North Macedonia 34.4

  26. Slide 26: A1 Telekom Austria Group: Workforce development

    A1 Telekom Austria Group: Workforce development FTE (Average Period) Q2 2022 Q2 2021 % change Austria 7,082 7,319 -3.2% International 10,396 10,315 0.8% Corporate 394 375 5.0% A1 Telekom Austria Group 17,872 18,009 -0.8% FTE (End of Period) Q2 2022 Q2 2021 % change Austria 7,068 7,305 -3.2% Internat

  27. Slide 27: A1 Telekom Austria Group: Net debt

    A1 Telekom Austria Group: Net debt as of June 30, 2021 Net Debt (excl. Leases) (in EUR million) 30 June 2022 31 December 2021 % change Long-term Debt 1,046.6 1,046.1 0.0% Short-term Borrowings 1,100.0 1,553.2 -29.2% Cash and Cash Equivalents -415.8 -534.4 22.2% Net Debt (excl. Leases) of A1 Telekom

  28. Slide 28: A1 Telekom Austria Group: Financial debt maturity profile

    A1 Telekom Austria Group: Financial debt maturity profile as of June 30, 2022 (in EUR mn) 1,100.0 746.9 299.7 0.0 0.0 0.0 2022* 2023 2024 2025 2026 2027  EUR 2,146.6 mn short- and long-term debt as of June 30, 2022 Lines of credit Ratings  Average cost of debt of 0.88%  Undrawn committed  S&P: B

  29. Slide 29: Appendix 3: Reconciliation of Free Cash Flow

    Appendix 3 Reconciliation of Free Cash Flow 29

  30. Slide 30: 1-6M 2022: Reconciliation free cash flow

    1-6M 2022: Reconciliation free cash flow 1-6 M 2022 1-6 M 2021 % change FCF after social plans new 368.0 297.8 23.6% Social plans new funded 57.2 47.2 21.1% Total social plans paid* -48.2 -49.7 -3.0% FCF - previously reported 377.0 295.3 27.7% *In the previous view all payments for all social plans

  31. Slide 31: Appendix 4: Regulatory Topics

    Appendix 4 Regulatory Topics 31

  32. Slide 32: Mobile Termination Rates

    Mobile Termination Rates Jul Jan Mar Jan April Aug Jul Jan 2017 2018 2019 2020 2020 2020 2021 2022 Austria (EUR) 0.008049 0.008049 0.008049 0.008049 0.008049 0.008049 0.007 0.0055 Bulgaria (BGN) 0.014 0.014 0.014 0.014 0.014 0.014 0.007 0.0055 Croatia (HRK)* 0.047 0.047 0.047 0.045 0.045 0.045 0.006

  33. Slide 33: Upcoming spectrum tenders/prolongations/assignments

    Upcoming spectrum tenders/prolongations/assignments* Expected Comments There’s an ongoing activity on a new “Spectrum Release Plan for Austria”, as well as Austria 2023 (26 GHz) preparatory works later this year for the allocation of 26 GHz in 2023. Bulgaria 2022 (700MHz, 800 MHz) No further info ye

  34. Slide 34: EU Roaming Regulation (Wholesale Tariffs)

    EU Roaming Regulation (Wholesale Tariffs) WHOLESALE July- Dec 22 2023 2024 2025 2026 2027 2028 Data (€/per GB) 2.00 1.80 1.55 1.30 1.10 1 1 Voice (€Cents/per minute) 2.20 2.20 2.20 1.90 1.90 1.90 1.90 SMS (€Cents/per SMS) 0.40 0.40 0.40 0.30 0.30 0.30 0.30 Results for the first half and the second q

  35. Slide 35: Appendix 5: Personnel restructuring in Austria

    Appendix 5 Personnel restructuring in Austria 35

  36. Slide 36: Quarterly Overview: Restructuring charges and provision vs. FTE

    Quarterly Overview: Restructuring charges and provision vs. FTE Overview restructuring charges FTEs addressed (in EUR million) 2016 2017 2018 2019 2020 2021 Q1 22 Q2 22 FTEs adressed FTE reduction 95.0 9.1 70.1 100.2 91.3 95.1 26.1 38.1 2016 2017 2018 2019 2020 2021 Q1 22 Q2 22 Servicekom contributi

  37. Slide 37: End of Presentation

    V / VZ End of Presentation 7 Al

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