Telstra Group Limited · ASX:TLS
Telstra — Investor Day (November 2008)
47 slides from Telstra's investor day presentation, Nov 6, 2008
Slide 1: Investor Day – Part 2 of slide presentations by Telstra Senior Executives
6 November 2008 Office of the Company Secretary For personal use only The Manager Level 41 242 Exhibition Street Company Announcements Office MELBOURNE VIC 3000 Australian Stock Exchange AUSTRALIA 4th Floor, 20 Bridge Street Telephone 03 9634 6400 SYDNEY NSW 2000 Facsimile 03 9632 3215 ELECTRONIC LO
Slide 2: Growth Opportunities for Telstra Business
For personal use only Growth Opportunities for Telstra Business Deena Shiff - GMD, Telstra Business TB is outpacing the market without eroding ARPU Revenue and Market Share Growth ARPU and Productivity FY08 Revenue Growth by Product Category ARPU grew or held steady in all TB major product categor
Slide 3: Telstra Business is growing rapidly
Telstra Business is growing rapidly For personal use only To be updated TB Half Yearly Revenue 1,900 ($m) 8.6% YoY Growth Declining Trend 1,700 1,500 H1 H2 H1 H2 H1 H2 H1 H2 FY05 FY06 FY07 FY08 Revenue mix is shifting to next generation services FY07 Revenue Mix FY08 Revenue Mix 6% 7% 6% 7% IP rev
Slide 4: Data consumption is growing rapidly and becoming more mobile
Data consumption is growing rapidly and For personal use only becoming more mobile TB Data Access Revenue YoY (Index: 2006/07=100) Growth Total = 152 Mobile BB 153% IP Access 62% Total = 100 Fixed BB 18% Business-specific solutions tailored to market needs are generating our highest growth • 205% gr
Slide 5: Business-specific solutions tailored to market needs are generating our highest growth
Business-specific solutions tailored to market For personal use only needs are generating our highest growth Telstra Next Dimension Working TM Imagine the Possibilities TM • IP Revenue Growth +62% • Next Dimension Working: Adoption of wireless ports +30% We are delivering a better service experience
Slide 6: Strengthening sales capability, capacity and coverage
Strengthening sales capability, capacity For personal use only and coverage Direct Sales Contact Centres Retail & Indirect Online • Reduced portfolio • Release capacity • Expanded TB • Tools to help customers sizes with greater through IVR changes presence in stores select & request the right segmen
Slide 7: Retail & Indirect
Retail & Indirect For personal use only 17 Business Centres Ability to demonstrate all TB products and applications Strong understanding of local market 10 Retail & Indirect 114 Accredited Partners Highest standard of business solution sales capability • 772 staff certified • 28,000 hours of expert
Slide 8: Retail & Indirect: ICT Partners
Retail & Indirect For personal use only 750 ICT Partners Reaching parts of the market TB could not previously reach Driving sales of new strategic products and applications 12 TB Portal 7
Slide 9: Tracking Our Progress
Tracking Our Progress For personal use only Slow PSTN Decline Grow Customer ARPU Reverse +7.6% Revenue -1.5% -4% Decline -10% FY06 FY07 FY08 FY07 FY08 Grow 3G % Mobile SIOs Grow BB & IP Customer Penetration Build Platform 64% 49% for 33% 31% 39% 4% Growth FY06 FY07 FY08 FY06 FY07 FY08 Grow Proportio
Slide 10: Growth Opportunities for Telstra Enterprise and Government
For personal use only Growth Opportunities for Telstra Enterprise and Government David Thodey – Telstra Enterprise & Government Telstra Enterprise & Government (TE&G) are on track to achieve our 2010 objectives (set in 2005) Milestones to meet by 2010 Progress made in FY’08 Grow revenue faster than
Slide 11: TE&G is delivering world class results
TE&G is delivering world class results in revenue, For personal use only expense controls and contribution growth TE&G Normalised Revenue Growth 03-08 International E&G Peer Revenue Growth1,2 6.0% 4.0 3.6% 3 BT Global 7.9% 2.0 Services 0.0 TE&G 3.6% -2.0 -4.0 Verizon 1.8% Business -6.0 2003 2004 200
Slide 12: Differentiated data and mobile offerings achieved key inflection points
Our differentiated data and mobile offerings achieved key inflection points as we transition For personal use only to new wave revenues Mobile Data & Cellular Inflection Point Legacy Data & IP Inflection Point Revenue Revenue $M $M Wireless Data IP Mobile Voice Data Sep 2007 Dec 2007 Mar 2008 Jun 20
Slide 13: Telstra Next IP network provides the foundation to grow IP value added services
TM Telstra Next IP network provides the foundation to grow IP value added services which increases For personal use only ARPU by up to 70% ~$600k Higher Hosting Customer Revenue ARPU IP Telephony IP Security ARPU can ~$350k* Managed WAN increase IP Network from 33% to 70% 2007/08 11% 52% 21% 44%
Slide 14: Improving customer productivity through Next Dimension Working
Our focus is to improve the productivity of For personal use only our customers through Next Dimension WorkingTM Office Mobile Meeting Collaborating Home Personal Workgroup Enterprise Customer Productivity Productivity Productivity Experience Real examples of businesses changing the way they work us
Slide 15: Next Generation Service capability: seven core application areas
Our Next Generation Service capability is focused on seven (7) core application areas with core services For personal use only disciplines in Professional Network Services and Managed Network Services Professional Network Services Managed Strategic Unified Contact Hosting & Network Security Mobility
Slide 16: In Summary
In Summary For personal use only • Strong results due to focus on value based management • Telstra Next IPTM and Next GTM networks are delivering real value to our customers • We are delivering solutions that drive improvements for individuals, companies and organisations • Customer service is criti
Slide 17: Building Growth in the Consumer Market
For personal use only Building Growth in the Consumer Market David Moffatt – GMD, Telstra Consumer Delivering world-class performance • Momentum across all products, • Higher share, higher margins all geographies generating profitable growth Revenue EBIT FY08 5.3% FY08 7.6% $10 billion $6.4 billion
Slide 18: Success across all categories, for all consumers
Success across all categories, for all consumers For personal use only • World-class growth in FIXED 56k revenues AND customers Acquisition and retention costs 9% • Consistent MOBILE services 7% Major Competitor revenue growth • INTERNET growth 38% -24% • Rapid growth acceleration in 3x PAY TV Outst
Slide 19: Our execution strategy
Our execution strategy For personal use only Consumer Growth Strategy Transformation Acquire Our people Network & IT & retain Continued Supports Enables Transforms implementation Free Whole of cash Go-to-market of flow Customer Multi- products and Channels Market Based Experience Management Improved
Slide 20: We are taking our customers on the journey
We are taking our customers on the journey For personal use only ‘Behind the Marketing Integrated Transformation View Beyond 8-ball’ (Past 2.5+ years) (Next 2.5+ years) “Single product categories” Multiple services Integration Further leveraging integration Fixed Mobile Internet Pay TV Winning the c
Slide 21: Showcasing what's possible from Telstra T[life]
Showcasing ‘what’s possible’ from Telstra T[life] TM For personal use only • Setting the world Post-paid new activation sales revenue (YoY) % benchmark in retail 71% • Customer feedback has been overwhelmingly positive 6% Traditional Telstra stores • T[life]TM accessory revenue Vs traditional Telstr
Slide 22: Telstra has a clear competitive advantage
Telstra has a clear competitive advantage For personal use only Customer Channel strength Breadth and Cost to serve knowledge and and local quality of relationships presence product People and Integration Strength and Financial strength leadership reach of brand Differentiating to win in the marketp
Slide 23: New Products & Services: Telstra Differentiation - Unified Communications
For personal use only New Products & Services Holly Kramer – GMD, Telstra Product Management Telstra Differentiation - Unified Communications Customer 1-click, 1-touch, 1-screen customer experience experience Integrated across access types Integrated Service Delivery Framework services Integrated as
Slide 24: Unified Communications - what & why now?
For personal use only Unified Communications - what & why now? 1-click to all your comms Integration of comms services Access from multiple devices Simple Seamless Everywhere What’s in it for Telstra? Protecting and stimulating core revenues Retaining & winning customer across multiple products Crea
Slide 25: World-class partners for business UC
For personal use only World-class partners for business UC Hosted Integration of Telstra’s hosted telephony with Microsoft OCS desktop Managed Managed solution for leading IP Tel PBX Small business Large enterprise & government What’s in it for business customers? Improved productivity with collabor
Slide 26: Consumer UC offering: Telstra's MyConnect
For personal use only Consumer UC offering: Telstra’s MyConnect What’s in it for consumer customers? Easy email on my mobile… … and text from online ↑ Mobile email penetration & ↑ Messaging revenue revenue All my messages in one place My contacts are always safe ↑ Multi-product holdings ↑ Sync reven
Slide 27: Defined evolution path for an integrated future
For personal use only Defined evolution path for an integrated future Consumer Business Simple Seamless Everywhere HD video conferencing Only with 5
Slide 28: The Opportunity for Telstra Media
For personal use only The Opportunity for Telstra Media Justin Milne – GMD, Telstra Media MediaComms is a cornerstone of Telstra’s value differentiation strategy Value Differentiation Strategy Integrated Personalised Experience Superior Superior Applications Networks & Services Customer MediaComms C
Slide 29: Telstra Media: consolidated view of Telstra's media assets
Telstra Media: Providing a consolidated For personal use only view of Telstra’s media assets International 3rd Party Affiliate sites Monetising content via multiple brands and superior networks A House of Brands Superior Networks & Monetising Customer Behaviour Audience Databases Pull through Data P
Slide 30: Leveraging Telstra's heritage of operational excellence
Leveraging Telstra’s heritage of operational For personal use only excellence to stand out from the pack Safe & Trusted Brand Strong Balance Sheet Billing Customer Knowledge Relationships Strong Sales Committed Support Channels We have already built a successful media business Online & Mobile Media
Slide 31: Telstra's online media network is the 4th largest publisher in Australia
Telstra’s online media network For personal use only is the 4th largest publisher in Australia Unique Audience (000’s) - September 08 9,751 7,925 5,667 5,089 4,968 4,706 4,059 Source: Nielsen//Netratings Netview, Sept 2008 We have continued to build on the success of MediaComms throughout 2008 Growi
Slide 32: Opportunity to extend success to Asia
There is now an opportunity to extend For personal use only this success to Asia by taking advantage of 3 unexploded ‘growth bombs’ Increasing Imminent shift High GDP Online & Mobile from Growth Penetration 2G to 3G GDP1 Technology Penetration2 % 3G Mobile Base China3 10.1% 47% 94% 92% 25% 2.7% 33%
Slide 33: Telstra Investor Day: FOXTEL Sustainable Growth
For personal use only Telstra Investor Day Sustainable Growth Kim Williams AM CEO FOXTEL GROWTH IN SUBSCRIBERS FOXTEL Subscriber Numbers Note: Years 2003+ include Optus wholesale subscribers, following the approval of the FOXTEL/ Optus CSA in November 2002 Source: FOXTEL Management 1
Slide 34: Significant service expansion
For personal use only SIGNIFICANT SERVICE EXPANSION Number Of Channels On The FOXTEL Platform (#) • 100% Digital • 145+ channels • EPG • FBO • FOXTEL iQ • Interactivity • Web EPG • Mobile FOXTEL… • Analogue • 46 channels Source: FOXTEL Management 2
Slide 35: 100% digital in record time
For personal use only 100% DIGITAL IN RECORD TIME FOXTEL Managed Digital Subscribers and Digital Penetration 99% 100% (k, %) 95% 90% 84% 79% 73% 68% 63% 57% 42% 34 months 26% 4% Source: FOXTEL Management 5 TRANSFORMED PRODUCT Electronic Programme Guide FOXTEL IQ Sports Active News Active Weather Act
Slide 36: Strengthened financial position
For personal use only STRENGTHENED FINANCIAL POSITION Continuous Subscriber Growth 1 (K) Continuous EBITDA Growth 400 1500 300 200 1000 1,416 351 1,271 100 1,099 169 0 79 500 -100 03/04 05/06 07/08 03/04 05/06 07/08 Continuous Revenue Growth Continuous Operating Profit Growth 1500 1,421 1000 1,268 9
Slide 37: Constant performance improvement – ARPU
For personal use only CONSTANT PERFORMANCE IMPROVEMENT– ARPU FOXTEL Has Constantly Improved ARPU Underpinned by Strong Product Take-up • 45% Platinum penetration • Only 4% stand alone entry package 42% • About 25% multiroom penetration • 30% FOXTEL IQ penetration June 2003 Today CONSTANT PERFORMANCE
Slide 38: Viewing in STV households
For personal use only VIEWING IN STV HOUSEHOLDS TV Share of Viewing, Subscription TV Households (%) 60.2 59.4 59.9 55.7 56.6 52.8 50.5 47.5 2001 2003 2004 2005 2006 2007 2008 Source: OzTAM. National STV Data. 0200-0200. Weeks 1-52, 2001 to 2007 (Where Available) and Weeks 1-43, 2008. NB 2008 was Oly
Slide 39: New FOXTEL HD+ channels
For personal use only NEW FOXTEL HD+ CHANNELS 13 CONTINUING PRODUCT INNOVATION 7
Slide 40: FOXTEL
FOXTEL See something. Feel something. FOXTEL‘
Slide 41: Leveraging the Integration of Advertising
For personal use only Leveraging the Integration of Advertising Bruce Akhurst – CEO, Sensis Great results… and a great future • World’s best results… and they’re sustainable • Investments driving usage, advertiser ROI and customer sat • Bringing Telstra mediacomms vision to life – Integrating across
Slide 42: A fantastic value proposition
A fantastic value proposition For personal use only 70 million uses per week1 90% conversion to contact1 70% conversion to purchase1 Almost 600,000 customers “Sensis means customers through the door and money in the bank” 1: Independent research by TNS of 18 – 64 year olds in Sydney, Melbourne, Bris
Slide 43: Usage: a year of innovation and growth
Usage: a year of innovation and growth For personal use only Usage doubled since February1 750,000 circulation increase 1234 call volumes up 24% Voice revenues up 17% More buyers using our services means more sales for our advertisers 1: Visits to Sensis Mobile sites. Source Omniture September 08 an
Slide 44: A real win for buyers and sellers
A real win for buyers and sellers For personal use only • Long term, complementary partnership –Sensis’ local and multi-channel strength –Google’s global search technologies • Yellow™ listings power Google High profile Maps Yellow™ listings, info and links • Google powers sensis.com.au More potentia
Slide 45: Advertiser ROI: Innovating for sellers
Advertiser ROI: Innovating for sellers For personal use only Info-rich delivers results: 88% preferred the info-rich ad1 Customer sat rising2 Value for money: print +7pp Value for money: online +12pp Satisfaction score for consultant performance at 93% positive2 1: Research conducted by Synovate “Pr
Slide 46: Exceptional growth opportunities in China
Exceptional growth opportunities in China For personal use only China Sales Revenue All things home Approximately 50% US$108m All things auto US$47m FY07 FY08 FY09E All things digital New Acqn (consolidated in FY09) SouFun Our strengths supporting China’s needs Revenue and EBITDA growth Leverage Sal
Slide 47: High performance, world leading, great future
High performance, world leading, great future For personal use only Building future growth by: • Investing in core print • Leveraging new media • Extending our business into new growth horizons • Bringing mediacomms to life 7