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Bouygues Sa — Société Générale presentation, June 18, 2004
33 slides from Bouygues Sa's conference presentation, Jun 18, 2004
Slide 1: Société Générale, June 18, 2004
Société Générale June 18, 2004 G.-C. Pélisson Chairman & C.E.O.
Slide 2: Agenda
z Bouygues group overview z Bouygues Telecom overview z Bouygues Telecom main assets 1. Innovative commercial policy 2. Technological choices z Bouygues Telecom outlook 2
Slide 3: Bouygues: four business areas
Bouygues: four business areas Roadworks Building/Civil Works Property 95.9% 100% 100% CONSTRUCTION TELECOM MEDIA UTILITIES 83% 41.4% 100% A diversified industrial group 3
Slide 4: The Bouygues group's strengths
The Bouygues group’s strengths ● A strong corporate culture, shared by all its business areas ● An effective control of the strategy and cash-flow of the subsidiaries ● A capacity to generate substantial cash flow ● A sound financial structure ● All its business areas hold leading positions on their
Slide 5: Agenda
z Bouygues group overview z Bouygues Telecom overview z Bouygues Telecom main assets 1. Innovative commercial policy 2. Technological choices z Bouygues Telecom outlook 5
Slide 6: Share ownership structure
Share ownership structure 83% 6.5% 10.5% Bouygues has raised its stake in Bouygues Telecom from 34% to 83% in 5 years 6
Slide 7: Bouygues Telecom today
Bouygues Telecom today GSM-GPRS GSM technologies UMTS licence licence obtained obtained in 1994 in 2002 Commercial 10,500 launch in BTS 1996 i-mode Roaming launch in agreements: 2002 180 countries and destinations 6,950 3,000 employees customer advisers A recognised operator, 8 years after launch 7
Slide 8: French market
French market (Metropolitan France and Carribean) Sales (1) Contract customers (2) 2002 2003 2002 2003 Bouygues Telecom 17.6% 18.2% 16.8% 17.4% Orange France 45.7% 44.4% 49.7% 47.9% SFR 36.7% 37.4% 33.5% 34.7% (1) Source: operators (2) Source: French telecom regulator (ART) Customer penetration rate
Slide 9: Main drivers
Main drivers Metropolitan France 2002 2003 Contract Contract customer base (in thousands) 3,534 4,207 ARPU (€/month) 54 52 SAC (€/customer) 216 231 Usage (min/month) 354 390 Prepaid Active SIM cards (in thousands) 2,076 2,235 SAC (€/customer) 57 22 Usage (min/month) 73 89 Contract subscribers repres
Slide 10: Consolidated key figures
Consolidated key figures €m Q1 2003 Q1 2004 Variation 2003 Sales (1) 751 (2) 878 + 17% (3) 3,283 Net sales from network (1) 700 (4) 783 + 12% (5) 2,995 Data in % of net sales from network 12.8% 17.4% + 4.6pts 13.8% EBITDA 218 270 +24% 1 001 EBITDA / net sales from network 31.2% 34.5% +3.3pts 33.4% E
Slide 11: Financial structure
Financial structure €m 2002 2003 2003 2002 Shareholders’ equity 2,148 2,320 + 8% Net debt 1,486 1,031 - 31% Net debt / Shareholders’ equity 69% 44% - Cash flow 741 896 + 21% Gross operating investments 468* 485 +4% * Excluding UMTS licence Sharp reduction in debt 11
Slide 12: Cash flow and investments
Cash flow and investments Gross operating investments Cash flow 1200 1,073 1000 896 800 738 741 544 600 485 400 468 200 312 0 20 -200 -400 -441 -600 1999 2000 2001 2002 2003 * Excluding UMTS licence A virtuous “scissors effect” 12
Slide 13: Agenda
z Bouygues group overview z Bouygues Telecom overview z Bouygues Telecom main assets 1. Innovative commercial policy 2. Technological choices z Bouygues Telecom outlook 13
Slide 14: Aiming to be the preferred brand of mobile services
Bouygues Telecom’s ambition Aiming to be the preferred brand of mobile services 14
Slide 15: Mass market commercial policy
Mass market commercial policy z 1996: first Contract and free voicemail created in France z 1997: launch of Prepaid no-commitment package Nomad z 2000: launch of Millennium (unlimited W-E offers) z 2001: launch of Mini Contract z 2002: i-mode launch in November z 2003: new i-mode launch in November
Slide 16: i-mode: a well-established new media
i-mode: a well-established new media z A growing success 9 680,000 customers in one year and a half 9 265 sites, more than a billion pages seen 9 A very positive feedback from content providers 9 17% of contract customers (2 hours and more) are i-mode’s subscribers z Summer 2004: a continuous innova
Slide 17: Summer 2004, a new generation services
Summer 2004, a new generation services Picture JavaTM Applis Localisation Video messaging and games Base Services Services Various sites More than Easiness Video clips using pictures 130 games of use video films 17
Slide 18: Corporate offer
Corporate offer ● Strong growth prospects: 9 Development of data services 9 The equipment rate in businesses is less than 25% 9 Number portability has become a reality in 2004 ● Commercial strategy: 9 A range of offers adapted to its customers… à standard, at an affordable price (Danone, Volkswagen,
Slide 19: Agenda
z Bouygues group overview z Bouygues Telecom overview z Bouygues Telecom main assets 1. Innovative commercial policy 2. Technological choices z Bouygues Telecom outlook 19
Slide 20: Technological choices (1/5)
Technological choices (1/5) Speed kbps UMTS 380 180 EDGE Videophone GPRS Video 35 Enriched, E-mail Browsing animated graphics Customisation Photos Java applications / Games Localisation services 2003 2005 2007 EDGE delivers fast enough transmission speeds for most multimedia services 20
Slide 21: Technological choices (2/5)
Technological choices (2/5) Our vision ● As we have said consistently since 2000, EDGE is a technology for the long term, complementary and necessary to UMTS ● UMTS: difficulties still not yet overcome: 9 complex network engineering 9 huge administrative difficulties for an "all UMTS" solution: in F
Slide 22: Technological choices (3/5)
Technological choices (3/5) Our approach ● A gradual shift in usage and the market towards high-speed mobile multimedia services (i-mode) 9 Enhanced messaging, photography, video 9 Personalised handset, CD quality sound 9 Quick downloads, Java applications, games 9 Animated i-mode portal, video down
Slide 23: Technological choices (4/5)
Technological choices (4/5) EDGE ● A natural evolution from GPRS, with a similar coverage ● Average speeds of 140 Kbps, rising to as much as 180 Kbps ● A competitive advantage for Bouygues Telecom thanks to its more recent infrastructure ● A proactive schedule: 9 Roll-out from May 2004 9 Commercial
Slide 24: Technological choices (5/5)
Technological choices (5/5) UMTS ● A new and complex network technology ● Bouygues Telecom's network architecture (1,800 MHz) brings an advantage in rolling-out UMTS ● Bouygues Telecom can draw on the support and the experience of NTT DoCoMo, the world leader in 3G with 4 million FOMA customers in J
Slide 25: Agenda
z Bouygues group overview z Bouygues Telecom overview z Bouygues Telecom main assets 1. Innovative commercial policy 2. Technological choices z Bouygues Telecom outlook 25
Slide 26: Initiatives to improve profitability
Initiatives to improve profitability Growth of sales ● Growth of the customer base ● An increasing usage and a stable ARPU ● Strong data development Focus on expenses ● Opex are under control: 9 Stable level (in % of sales from network) of acquisition and loyalty costs 9 IT expenses are contained th
Slide 27: Strategy and outlook
Strategy and outlook ● Pursue strong sales growth whilst improving profitability ● Maintain its lead in mobile multimedia with i-mode ● Offer simple, well-positioned services and develop customer service ● Develop the Corporate segment ● Provide high-speed coverage throughout France as of 2005 throu
Slide 28: Appendices
Appendices 28
Slide 29: Bouygues: key figures over 5 years
Bouygues: key figures over 5 years (in M€) Sales EBITDA 22,247 21, 822 2,260 2,415 X 2.5 20,473 19,060 1,680 15,857 + 38% 1, 474 974 4,983 534 1999 2000 2001 2002 2003 T1 1999 2000 2001 2002 2003 T1 2004 2004 Operating income Net earnings 666 1,238 1,058 X 2.6 Non recurring 450 X 10 876 items 421 81
Slide 30: Bouygues: key figures per share over 5 years
Bouygues: key figures per share over 5 years (in €) Net earnings per share Net dividend per share 1.93 0.50 (+ 39%) 1.31 1.34 (+ 44%) 0.36 0.36 0.36 X2 1.03 X8 0.26 0.93 0.16 0.75 0.46 1999 2000 2001 2002 2003 1999 2000 2001 2002 2003 Non recurring items Recurring items 30
Slide 31: Bouygues: solid financial structure
Bouygues: solid financial structure €m 2001 2002 2003 Net debt 1,124 3,201 2,786 Net debt / shareholders’ equity 20% 50% 45% Cash flow 1,135 1,713 2,073 Net operating investment 1,125 1,226 * 930 Free cash flow 278 921* 1,363 * Excluding UMTS licence Standard & Poor’s credit rating maintained: A- wi
Slide 32: Growth of i-mode
Growth of i-mode October April 2002 2002 March November 2002 2002 February 1999 November 2003 June 2003 June 2004 Taiwan June 2002 A global standard 32
Slide 33: Data transport technologies used for mobile networks
Data transport technologies used for mobile networks Speeds Real speed GPRS 35 Kbps EDGE 180 Kbps UMTS (R99) 380 Kbps UMTS (R5) 2 Mbps HSDPA GPRS : General Packet Radio Service EDGE : Enhanced Data for GSM Evolution UMTS : Universal Mobile Telecommunications Systems HSDPA : High-Speed Downlink Pac
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