Safaricom Plc · NSEKE:SCOM
Safaricom — FY2010 Earnings Presentation
27 slides from Safaricom's earnings presentation, May 26, 2010
Slide 1: FY 2010 Results Announcement
Safaricom Ltd FY 2010 Results Announcement 26th May 2010
Slide 2: Our Vision & Strategy
2 Our Vision & Strategy Data growth through infrastructural investment Consolidate Fixed & Mobile Data Growth Increase Wimax Coverage & Product innovation Increase M-PESA Penetration Expansion of M-PESA services Increase product offering under M-PESA Stimulate voice revenue growth through Dynamic ta
Slide 3: Delivering on Strategy
3 Delivering on Strategy We have achieved Growth in Increased Revenues and Maintained No. 1 penetration of Profit Market Position innovative products p through well aligned actions Increased focus on Data Investment in Infrastructure to Strengthening our brand and M-PESA services to support the qual
Slide 4: Performance Highlights
4 Performance Highlights 15 15.79mn 79mn Ksh Ksh. 83.96 83 96 bn K h 36 Ksh. 60b K 36.60bn h 15 Ksh. 15b 15.15bn K h 00.38 Ksh. 38 K Ksh. h 88.00bn 00b 18.9% 18.2% 19.1% 31.0% 43.8% 44.2% 100.% S b ib Subscribers T rn er Turnover EBITDA Net N t EPS Di id d Dividends Income
Slide 5: Operating Environment
OPERATING ENVIRONMENT
Slide 6: Regulatory Environment
6 Regulatory Environment • Universal Service Fund • Service & Mobile Number portability • Subscriber Identity Registration • Kenya Information & Communications Regulations 2010 • Termination Rates
Slide 7: Market Dynamics
7 Market Dynamics Mobile Penetration Across Africa (%) Zimbabwe Uganda Tunisia Togo • Sub-Saharan Africa still the fastest Tanzania South Africa growing mobile market in the world Somalia Seychelles Senegal • Mobile penetration in Kenya at 50 % as Réunion Nigeria at 31st March 2010; Mayotte M iti Ma
Slide 8: Company Performance
COMPANY PERFORMANCE
Slide 9: Strong Operational Performance
9 Strong Operational Performance R Revenue 83 96 83.96 EBITDA/EBITDA Margin 36.60 Ksh. Billion Ksh. Billion / % 70.48 19.1% 31.0% 27.95 43.6% 39.7% FY 2009 FY 2010 FY 2009 FY 2010 Net Income/ Margin 15.15 Shareholder Funds 62.54 Ksh. Billion Ksh. Billion 22.0% 43.8% 10.54 51.25 18.0% 15 0% 15.0% FY
Slide 10: Maintained Market leadership
10 Maintained Market leadership Subscribers 15 79 15.79 Market Share Million 10.6% 5.4% 18.2% 13.36 5.6% 10 23 10.23 78.3% Essar Telecom Kenya Safaricom FY 08 FY 09 FY 10 Orange Kenya Zain Kenya Source: WCIS 15.79 15 79 million illi subscribers b ib by b March M h 2010 Market M k leader l d withi h
Slide 11: Staying Ahead
11 Staying Ahead Through cutting-edge products and services we ensure customer satisfaction and retention • M-PESA • Bonga Points • Dynamic tariffs with low calling rates • 3G network platform • Low cost recharge vouchers
Slide 12: Aggressive push on Acquisition products
12 Aggressive push on Acquisition products • Aggressive selling of handsets , laptops modems and other accessories • Acquisition revenues increased by 58 5% to Ksh. 58.5% Ksh 3.66 3 66 bn (Ksh.2.31 (Ksh 2 31 bn in March’09) • In line with our acquisition strategy that aims at increasing mobile penet
Slide 13: Growth propelled by DATA & M-PESA
13 Growth propelled by DATA & M-PESA DATA Revenue DATA/M-PESA DATA/M PESA Users 9.48 Ksh. Billion Millions 7.56 6.18 Data Users 2.93 M-PESA Users 2.98 0.37 1.51 2.64 0 34 0.34 2.08 4.67 5.19 1.47 4.26 0.96 FY 2008 FY 2009 FY 2010 FY 08 FY 09 FY 10 Data revenue increased by 72.8% representing Strong
Slide 14: Data Penetration
14 DATA Penetration Data Subscribers & Penetration 16.71% 3.00 18.00% 16.00% 2.50 2.64 14.00% 2.00 12.00% on Data Subs -Millio Penetration 10.00% 1.50 8.00% 1.00 6.00% 4 00% 4.00% 0.50 2.00% - 0.00% ar-09 ar-10 Sep-08 ct-08 c-08 Sep-09 ct-09 c-09 pr-08 pr-09 v-08 n-09 v-09 n-10 y-08 n-08 ul-08 g-08
Slide 15: M-PESA: Continued growth and performance
15 M-PESA : Continued growth and performance Registered Users Monthly Value of P2P Transactions Billions 10,000,000 30.00 9,000,000 25.00 8,000,000 , , 7,000,000 20 00 20.00 6,000,000 5,000,000 15.00 4,000,000 10.00 3,000,000 2,000,000 5.00 1,000,000 0 0.00 n-09 Febb-10 Marr-09 Aprr-09 Mayy-09 ul-09
Slide 16: M-PESA: Much more than money transfer
16 M-PESA: Much more than money transfer M PESA is M-PESA i now used d for f • Airtime purchase • Utilityy bill ppayments y • Bulk cash payments e.g salary payments • International money transfer • ATM withdrawals • Dividend Di id d paymentt • Social/Charitable collections • Banking
Slide 17: Safaricom Business: Total Communications Solutions
17 Safaricom Business: Total Communications Solutions Going beyond Business Data connectivity to Business Voice providing total communication service solutions. Business Value Added A Services S Business Messaging Service
Slide 18: Our Future: Building on our Strengths
18 Our Future: Building on our Strengths Sustain Voice Company Revenue Strategy M-PESA expansion Consolidate Data Growth Expansion Maintain of #1 products Market Enhance under the Mobile Position M-PESA and Fixed service Company Stable data Focus cost growth control
Slide 19: Financials
FINANCIALS
Slide 20: Key Financials: FY2010 Summary
21 Key Financials: FY2010 Summary Ksh. Billion Mar-10 Mar-09 % CHANGE Revenue 83.961 70.480 19.1% EBITDA 36.604 27.951 31.0% EBITDA Margin M i 43 6% 43.6% 39 7% 39.7% Operating Profit 22.611 16.175 39.8% Profit Before Tax 20.967 15.304 37.0% Net Income 15.148 10.537 43.8% Key KPIs Basic EPS 0 38 0.3
Slide 21: KPIs: Continued Revenue Growth
21 KPIs: Continued Revenue Growth YoY Revenues Analysis Data Revenue Breakdown Ksh. billions Ksh. Billions / % of Revenue 15,724 5.19 6.2% 9,097 18.8% 4,972 2.98 3.6% 15.72 4,043 63,405 54,203 58,795 7.56 9.0% 41,508 FY 2007 FY 2008 FY 2009 FY 2010 Voice SMS/Data Acquisition Other SMS/ Data SMS Broa
Slide 22: KPIs: Robust ARPU & Churn
22 KPIs: Robust ARPU & CHURN Blended ARPU Churn Rate Ksh. 475 68% 459 30.6% 356 27 2% 27.2% 24.3% 22.4% 18.2% 126 79 3.2% 1.6% -10.5% M-PESA Data ARPU Voice Blended Blended FY 08 FY 09 FY 10 ARPU ARPU ARPU 2010 ARPU 2009 Churn Churn Growth Subscriber growth Blended ARPU declined 3.4% to Ksh. 458.5 d
Slide 23: KPIs: Expanding EBITDA & Margins
23 KPIs: Expanding EBITDA & Margins YoY EBITDA Revenue/EBITDA Analysis EBITDA EBITDA Margin (%) Ksh. Billion 60 83.96 35 51.7% 55 30 45.9% 50 (36.55) 43.6% 25 45 39.7% 20 40 36.6 (10.80) 36.60 35 15 28.2 28.0 24.5 30 10 25 5 20 0 15 Revenue R Opex O SG&A EBITDA FY 07 FY 08 FY 09 FY 10 • Strongg EBIT
Slide 24: Stable Cost Structure: OPEX & SG&A
24 Stable Cost Structure: OPEX & SG&A OPEX & SG&A Breakdown Cost Intensity (% of Revenue) 2,689 2,662 46.5% 2,436 5,625 42.5% 43.5% 2,301 4,325 4,447 38.3% 1,816 2,291 3 356 3,356 3,155 6,566 2,960 7,126 1,263 7,994 2,331 6,749 7,557 1,846 3,674 13.8% 12.9% 5,783 10.8% 0.8% 11.8% 4,339 13 023 13,023
Slide 25: Capital Expenditure: Investing for the Future
25 Capital Expenditure:-Investing for the Future B Base S i Stations CAPEX Ksh. billion 30.0 50% Total 2162 40.2% 3G 25.0 40% 1899 33.8% Wi Wimax 20.0 7.8 6.5 30% 1558 20.8% 20% 15.0 3.4 3.0 4.0 2.1 2.3 1.0 10% 10.0 85 8.5 76 7.6 0% 607 10.5 5.0 -10% 301 1.4 3.6 2.6 116 140 0.0 0.9 -20% FY 08 FY 09
Slide 26: Disclaimer
26 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 its contents. This presentation does n
Slide 27: Thank You
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