Hutchison Telecommunications Hong Kong Holdings Limited · HKEX:215

Hutchison Telecommunications Hong Kong — H1 2015 Earnings Presentation

25 slides from Hutchison Telecommunications Hong Kong's earnings presentation, Aug 4, 2015

  1. Slide 1: 2015 Interim Results Presentation

    Hutchison Telecommunications Hong Kong Holdings Limited (Stock code: 215) 2015 Interim Results Presentation 4 August 2015

  2. Slide 2: Disclaimer

    Disclaimer These materials have been prepared by Hutchison Telecommunications Hong Kong Holdings Limited (HTHKH) solely for use at this presentation and have not been independently verified. No representations or warranties, express or implied, are made as to, and no reliance should be placed on, th

  3. Slide 3: Business Performance

    Business Performance

  4. Slide 4: Highlights

    Highlights 2015 1H 2014 1H Change % HK$ millions HK$ millions Consolidated Turnover 11,020 6,227 +77% Consolidated EBITDA 1,456 1,181 +23% Consolidated EBIT 789 527 +50% Net Profit(1) 508 323 +57% 10.54 6.70 Earnings per Share +57% HK cents HK cents 5.20 4.25 Interim Dividend per Share +22% HK cents

  5. Slide 5: Outlook

    Outlook  Balanced integrated telecom operator benefited from mobile and fixed-line contributions  Mobile business  Focus on margin and profitability  Upgrade customers to high speed plans  Fixed-line business  Focus on network solution offerings in corporate market  Gradual improvement in car

  6. Slide 6: Mobile

    & © WW é éw ’ g@ oO Rg OS ye \ y Qa az

  7. Slide 7: Mobile Business

    Mobile Business Local net customer service revenue margin Mobile revenue after deducting CAC 1,600 10,000 9,242 1,377 1,444 +5% 416 HK$ millions +108% HK$ millions 6,734 800 5,000 4,438 381 1,709 2,348 2,092 0 0 2014 1H 2015 1H 2014 1H 2015 1H Bundled revenue Standalone revenue Service revenue 6

  8. Slide 8: Mobile KPIs

    Mobile KPIs Blended local postpaid ARPU and net AMPU Postpaid Churn 209 210 202 194 3.0% 158 151 2.3% HK$ / month 145 137 Percentage (%) 140 132 124 2.0% 1.9% 1.8% 70 1.0% 0 0.0% 2014 2014 2015 2014 2014 2015 2014 2014 2015 2014 1H 2014 2H 2015 1H 1H 2H 1H 1H 2H 1H 1H 2H 1H Local net AMPU(3) Local n

  9. Slide 9: Quality customer base

    Quality customer base Total customers* Data user penetration* 2,200 100% % to 3G+4G LTE postpaid 3,588 3,197 75% 2,869 65% customers 59% ‘000 1,100 50% 1,752 1,836 1,537 1,660 1,327 1,542 0 0% 2014 1H 2014 2H 2015 1H 2014 1H 2014 2H 2015 1H prepaid postpaid * Include HK and Macau 8

  10. Slide 10: Fixed-line

    VViseNE T CloudConnect WiseNE T \/ uct Cloud At Cloud uct Cloud pctcleni eax Surveillance Audience Analytics Signage Cuee Cloud Out Superhub Auee Cloud Video Conferencing Hosted Exchange Email Service Document Management Service

  11. Slide 11: Fixed-line business

    Fixed-line business 2014 1H 2015 1H Total revenue: Total revenue: HK2,013 million HK1,984 million Others(1) Others(1) 3% 3% Residential Residential 15% 15% International International and and Corporate Local Carrier Corporate Local Carrier and 54% and 53% Business Business 28% 29% 1 “Others” include

  12. Slide 12: Corporate and Business Market

    Corporate and Business Market • 4% increase from growing Corporate and Business revenue demand of data connectivity 600 560 581 • Solution based offerings 126 128 including data centre services HK$ millions 29% • Serving mainly financial 300 institutions, government 432 455 Contribution to fixed-lin

  13. Slide 13: International and Local Carrier Market

    International and Local Carrier Market • 2% drop mainly from voice International and local carrier revenue • International service leveraging 1,200 1,077 submarine cable facilities 1,052 HK$ millions 508 451 • Local backhaul services to 53% mobile operators 600 Contribution to fixed-line revenue 569

  14. Slide 14: Residential Market

    Residential Market • 6% decrease due to competitive pricing in certain segments • Continue to capture fast-speed 15% market share • 1GB FTTH in offer plus cloud based VAS Contribution to fixed-line revenue • Plan to increase homepass to >2m by 2017 (>80% coverage) 13

  15. Slide 15: Financial Overview

    Financial Overview

  16. Slide 16: Financial Highlights - Consolidated

    Financial Highlights - Consolidated 2015 1H 2015 1H 2014 1H vs HK$m HK$m 2014 1H Turnover 11,020 6,227 77% EBITDA 1,456 1,181 23% Consolidated EBITDA margin (%) (EBITDA / service revenue) 38% 29% 9% EBIT 789 527 50% Profit for the period 600 362 66% Profit attributable to shareholders 508 323 57% Ea

  17. Slide 17: Turnover

    Turnover Consolidated turnover 12,000 11,020 416 Mobile hardware bundled sales revenue HK$ millions 6,227 6,734 Mobile hardware standalone handset sales revenue 6,000 381 1,709 Consolidated Service revenue Service revenue (before elimination) 4,137 3,870 0 2014 1H 2015 1H Mobile business turnover Fi

  18. Slide 18: Key cost items

    Key cost items Cost of inventories sold Key cost items 8,000 4,000 3,640 6,975 -11% 3,256 654 18% HK$ millions HK$ millions 667 20% 347 9% +239% 361 10% 187 6% 386 12% 4,000 2,000 2,060 2,278 63% 2,016 62% 0 65.0% 0 2014 1H 2015 1H 2014 1H 2015 1H Depreciation and amortisation Staff costs Customer a

  19. Slide 19: EBITDA/EBIT Margin

    EBITDA/EBIT Margin Consolidated EBITDA Consolidated EBIT 1,200 20% 20% 2,000 38% 40% 29% 33% 16% 30% 13% HK$ millions 28% HK$ millions 12% 1,000 20% 600 10% 1,181 1,456 789 10% 527 0 0% 2014 1H 2015 1H 0 0% 2014 1H 2015 1H EBITDA EBITDA margin EBIT EBIT margin Service EBITDA margin Service EBIT marg

  20. Slide 20: Profitability

    Profitability Net profit* Earnings per share 800 15.00 10.54 HK cents HK$ millions 508 10.00 +57% +57% 6.70 400 323 5.00 0.00 0 2014 1H 2015 1H 2014 1H 2015 1H * Net profit after tax and non-controlling interests 19

  21. Slide 21: Capex investment

    Capex investment Consolidated Capex 500 14% 420 % to service 353 revenue HK$ millions 10% 250 9% 7% 0 0% 2014 1H 2015 1H Mobile Capex Fixed-line Capex 300 16% 300 20% % to service % to service 220 200 revenue revenue 193 HK$ millions HK$ millions 160 150 8% 150 10% 9% 10% 10% 8% 0 0% 0 0% 2014 1H 20

  22. Slide 22: Financial position

    Financial position Net debt Net debt/ LTM EBITDA 5,000 40% 2.0 Net debt to net total 3,794 1.6x 3,593 HK$ millions 1.3x capital % 2,810 1.0x 2,500 25% 20% 23% 1.0 19% 0 0% 0.0 As at As at As at As at As at As at 30 Jun 2014 31 Dec 2014 30 Jun 2015 30 Jun 2014 31 Dec 2014 30 Jun 2015 Net debt to net

  23. Slide 23: Dividend and Liquidity

    Dividend and Liquidity EBITDA less CAPEX Dividend per share 1,500 10.00 8.70 1,103 HK$ millions HK cents 1,000 761 5.20 720 5.00 4.25 500 0 0.00 2014 1H 2014 2H 2015 1H 2014 1H 2014 2H 2015 1H 22

  24. Slide 24: Q&A

    Q&A

  25. Slide 25: Thank You

    Thank You

Hutchison Telecommunications Hong Kong Holdings — H1 2015 Earnings Presentation on 6ix