Slide 1: Interim Report Q2 2020
Q2 2020 Interim Report Q2 2020 1 5 J U LY 2 0 2 0
Slide 2: Q2 2020 highlights
INTERIM REPORT Q2 2020 Q2 2020 highlights • Steady development continued • Revenue grew by 2% • Comparable EBITDA up by 3% • Mobile service revenue at the same level – Substantial decrease in roaming revenue due to COVID-19 • Post-paid churn decreased to 16.4% (18.9% in Q1) • Post-paid mobile subscr
Slide 3: Steady performance in COVID-19 circumstances
INTERIM REPORT Q2 2020 Steady performance in COVID-19 circumstances Revenue Mobile service revenue Revenue, €m YoY change.% MSR, €m YoY change,% 6,5% Increase • Roaming impact 2,4% 3,5% 2,0% 1,9% 2,3% 1,5% 2,1% -1,3% • Polystar -0,2% • 4G and 5G up- • Equipment sales selling continues • Estonia • Pr
Slide 4: Revenue growth in both segments
INTERIM REPORT Q2 2020 Revenue growth in both segments Consumer Customers Revenue and EBITDA1) Revenue, €m EBITDA, €m EBITDA-% Revenue +1% + Mobile services + Equipment sales, Estonian business 37% 40% 38% 39% 36% - Domestic digital services - Fixed-line services 282 106 295 117 302 109 286 109 285
Slide 5: Strategy execution
INTERIM REPORT Q2 2020 Strategy execution Increase mobile and fixed service revenues Grow digital service businesses Improve efficiency and quality 5
Slide 6: Up-selling of mobile subs continues, 5G proceeds
INTERIM REPORT Q2 2020 Up-selling of mobile subs continues, 5G proceeds Growth in 4G smartphone penetration Smartphone and 4G speed penetration,% Smartphone penetr.1) 4G speed penetr.2) 4G 50 Mbps penetr.2) • 86% of customers use a smartphone 82% 83% 84% 84% 85% 85% 86% 80% 80% 81% – 98% (97%) 4G- a
Slide 7: Elisa leading in 5G
INTERIM REPORT Q2 2020 Elisa leading in 5G • 5G network launched in 31 cities, over million people coverage, capital area coverage expanded to tens of new locations • The widest selection of 5G devices: Samsung Galaxy A51 5G, Motorola Edge and Motorola Moto G 5G • Data usage YoY growth over 40 per c
Slide 8: Expansion of digital service businesses continued
INTERIM REPORT Q2 2020 Expansion of digital service businesses continued Domestic digital services International digital services • Elisa Viihde Aitio and Viaplay Films & Series combine • Again solid quarter for Polystar with double-digit YoY in Finland growth driven by increased demand for analytic
Slide 9: Outlook and guidance for 2020
INTERIM REPORT Q2 2020 Outlook and guidance for 2020 The current COVID-19 situation will slow down economic growth and create uncertainty in macroeconomic development. Competition in the Finnish telecommunications market remains keen. • Guidance for 2020 is unchanged • Revenue at same level or sligh
Slide 10: Financial review
Q2 2020 Financial review INTERIM REPORT Q2 2020
Slide 11: Growth in revenue and earnings
INTERIM REPORT Q2 2020 Growth in revenue and earnings € million 1) Q2/20 Q2/19 Change % Q2 2020 revenue change YoY. €9m Revenue 461 452 9.2 2.0 % Other operating income 1 1 -0.4 -40.2 % -0 Materials and services -167 -169 2.0 -1.2 % 5 Employee expenses -82 -82 0.1 -0.2 % Other operating expenses -45
Slide 12: Growth continues in Estonia
INTERIM REPORT Q2 2020 Growth continues in Estonia • Revenue and EBITDA improved Revenue Revenue, €m YoY change, % – Revenue growth +2% 10,0% 7,2% 6,7% • Equipment sales 2,1% • Fixed and mobile services 1,2% – EBITDA growth +8% – Mobile and fixed services growing 42,2 44,5 47,8 44,4 43,1 – Mobile po
Slide 13: Full year CAPEX guidance intact
INTERIM REPORT Q2 2020 Full year CAPEX guidance intact • CAPEX €75m (61), excl. IFRS 16 CAPEX1) and licence €65m (55) CAPEX / sales1) % 15% 12% 11% 10% 14% – Consumer €49m (41) – Corporate €26m (20) 71 65 55 52 48 Q2/19 Q3/19 Q4/19 Q1/20 Q2/20 • Main CAPEX areas Shares, licences and rental agreement
Slide 14: Cash flow impacted by NWC and higher CAPEX
INTERIM REPORT Q2 2020 Cash flow impacted by NWC and higher CAPEX • Q2 Cash flow €83m (37) Cash flow and comparable cash flow, €m 102 98 • Q2 comparable cash flow €85m (102) 85 73 55 – Higher EBITDA affected positively 97 83 73 55 – Less positive NWC change and higher CAPEX 37 affected negatively Q2
Slide 15: Efficient capital structure and good returns
INTERIM REPORT Q2 2020 Efficient capital structure and good returns • Capital structure according to target Net debt Net debt, €m Net debt / EBITDA – Net debt / EBITDA 2.0x (target 1.5–2x) 2,0 1,8 1,7 1,8 2,0 – Equity ratio 35.9% (target >35%) 1 184 1 332 1 124 1 073 1 068 2016 2017 2018 2019 Q2/20
Slide 16: Q&A
Q&A
Slide 17: P&L by quarter
APPENDIX P&L by quarter EUR million Q2/20 Q1/20 Q4/19 Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Revenue 460.8 468.1 487.3 464.9 451.6 439.7 470.6 453.9 YoY growth 2.0 % 6.5 % 3.5 % 2.4 % -1.3 % -2.2 % -0.4 % 0.0 % Other operating income 0.6 0.6 3.0 0.9 1.1 0.7 0.9 1.8 Materials and services -166.8 -171.6 -191.7
Slide 18: Cash flow YoY comparison
APPENDIX Cash flow YoY comparison Q2/20 Q2/19 Change1) % 1H/20 1H/19 Change1) % EBITDA 168 159 9 6% 334 314 20 6% Change in receivables 8 5 3 65 % 31 14 17 120 % Change in inventories -10 -1 -9 1367 % -8 5 -13 -259 % Change in payables 2 5 -3 -61 % -20 -2 -18 924 % Change in NWC 1 10 -9 -94 % 3 17 -
Slide 19: Cash flow by quarter
APPENDIX Cash flow by quarter EUR million Q2/20 Q1/20 Q4/19 Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 EBITDA 168 166 168 179 159 155 158 169 Change in receivables 8 23 -32 -2 5 9 4 -23 Change in inventories -10 2 -6 -1 -1 6 -7 2 Change in payables 2 -22 27 -9 5 -7 -1 2 Change in NWC 1 3 -11 -12 10 8 -4 -20 Fina
Slide 20: Debt structure
APPENDIX Debt structure EUR million at the end of the quarter Q2/20 Q1/20 Q4/19 Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Bonds and notes 759 758 757 943 941 939 767 766 Commercial papers 307 176 133 65 80 10 107 179 Loans from financial institutions 250 250 250 290 290 250 250 200 Financial leases 1) 90 93 96
Slide 21: Contacts
Contacts: Mr Vesa Sahivirta Ms Kati Norppa vesa.sahivirta@elisa.fi kati.norppa@elisa.fi +358 50 520 5555 +358 50 308 9773 investor.relations@elisa.fi
Slide 22: Forward-looking statements
INTERIM REPORT Forward-looking statements Statements made in this document relating to the future, including future performance and other trend projections, are forward-looking statements. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and d