86 slides from VEON Ltd. ORD's corporate update, Mar 31, 2015
Slide 1: Creating value by investing in the future
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Creating value by investing in the future Gerbrand Nijman Group Director & Head of Investor Relations < 1>
Slide 2: Disclaimer
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Disclaimer This presentation contains “forward-looking statements”, as the phrase is defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements relate to, among other things,
Slide 3: © VimpelCom Ltd. 2015 Georgia & Kazakhstan Site Visit 2015
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 < 3>
Slide 4: Program March 31, 2015
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Program March 31, 2015 Time Georgia analyst & investor site visit – Tbilisi 08:15-08:30 Registration 08:30-08:55 Gerbrand Nijman Head of IR VimpelCom 08:55-09:25 Andrey Patoka Head of Business Unit CIS 09:25-09:55 Giorgi Tkeshelashvili CEO G
Slide 5: Program April 1, 2015
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Program April 1, 2015 Time Kazakhstan analyst & investor site visit – Almaty 10:00-10:05 Gerband Nijman Head of IR VimpelCom 10:05-10:30 Taras Parkhomenko CEO Kazakhstan 10:30-11:10 Alexander Komarov CCO Kazakhstan 11:10-11:30 Break 11:30-12
Slide 6: A well diversified leading international mobile operator
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 A well diversified leading international mobile operator Headquartered in Amsterdam Mobile Population USD 19.6 billion customers covered Total revenue 222 739 split2 (%) 37 8 5 5 4 43 31 million2 million3 69% from Emerging markets USD 8.0 bi
Slide 7: VimpelCom simplified structure
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 VimpelCom simplified structure VimpelCom Amsterdam Africa Russia Italy Ukraine CIS & Asia Algeria Kazakhstan Pakistan Uzbekistan Bangladesh Tajikistan Zimbabwe Georgia Laos Kyrgyzstan Armenia < 7>
Slide 8: VimpelCom has an attractive emerging markets portfolio
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 VimpelCom has an attractive emerging markets portfolio ~70% of revenue in emerging markets Emerging market portfolio ► Solid market positions in our seven FY14 major emerging markets: – #1 in 4 (UKR, ALG, PAK, UZB) Revenues USD 13.5 bn – #2
Slide 9: Strong EBITDA margin versus our global peers
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Strong EBITDA margin versus our global peers EBITDA Margin (FY14) 50% 44% 44% 41% 37% 37% 33% 33% 31% 29% 23% VIP WE Telcos with CIS / Emerging Market1 Others2 CEE Exposure 1 3Q14 LTM EBITDA Margin for MTS 2 Others include a sample of more t
Slide 10: Growth drivers
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Growth drivers External growth drivers VimpelCom’s positioning ► Customer growth from increase in mobile ► Leading player in growth markets with high penetration quality networks ► Mobile data usage growth ► Significant upsides in penetratio
Slide 11: Significant upside in terms of mobile penetration & data usage
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Significant upside in terms of mobile penetration & data usage Mobile penetration1 Mobile data penetration2 Data usage2 (%) (%) (MB / User) 171% Western Europe 160% Avg: 66% 1,313 147% 1,213 Western Europe 138% Avg: 133% 132% 57% 55% 113% 52
Slide 12: BU CIS: Attractive markets and market positions
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 BU CIS: Attractive markets and market positions Revenue split (Percentage, %) 9% #1 #2 #3 4% 7% • Tajikistan • Kazakhstan • Georgia 38% • Uzbekistan • Armenia 7% • Kyrgyzstan 36% Kazakhstan Uzbekistan Armenia Tajikistan Georgia Kyrgyzstan <
Slide 13: Recent strategic highlights
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Recent strategic highlights • Algeria transaction signed and closed • Portfolio clean up almost complete • Improved capital structure with USD 21 billion in financing activities in 2014 • USD 0.5 billion annualized net income enhancement fro
Slide 14: Financial calendar 2015 – accelerating reporting
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Financial calendar 2015 – accelerating reporting 20151 1Q15 results May 13 A&I site visit Russia July 8 2Q15 results (analyst meeting in London) August 6 A&I Conference (London) October 8 - 9 3Q15 results November 6 1. The final confirmation
Slide 15: BU CIS excluding Kazakhstan
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 BU CIS excluding Kazakhstan Andrey Patoka Group Executive Vice President and Head of CIS < 15>
Slide 16: Attractive markets
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Attractive markets Georgia Uzbekistan Kyrgyzstan Armenia Tajikistan < 16>
Slide 17: Leading positions in growing markets
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Leading positions in growing markets Uzbekistan Tajikistan Kyrgyzstan ► #1 (out of 3 operators) ► #1 (out of 4) ► #1 (out of 3 operators) ► SIM penetration 66% ► SIM penetration 122% ► SIM-penetration 125% ► 3G and 4G/LTE ► First 3G launch i
Slide 18: Strong performance in 2014
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Strong performance in 2014 Average mobile penetration Population covered Mobile customers (%) (million) (million) 4Q14 84% 44 16.7 Revenue1 EBITDA1 EBITDA margin (USD million) (USD million) (%) FY14 1,121 562 50.1 +3% organic1 YoY +3% organi
Slide 19: Significant upside in terms of mobile penetration & data usage
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Significant upside in terms of mobile penetration & data usage Mobile penetration1 Mobile data penetration2 Data usage2 (%) (%) (MB / User) 171% Western Europe 160% Avg: 66% 1,313 147% 1,213 Western Europe 138% Avg: 133% 132% 57% 55% 113% 52
Slide 20: Leadership positions in most BU CIS markets
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Leadership positions in most BU CIS markets • Improving market positions in 4 out of 5 BU CIS markets • Growing markets with strong mobile data revenue growth • High EBITDA margins • Healthy cash flows • Growing and young population • Improv
Slide 21: Strong financial performance
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Strong financial performance Total revenue EBITDA & EBITDA margin (USD million) (USD million) 1,109 1,121 562 950 465 448 47% 42% 50% FY12 FY13 FY14 FY12 FY13 FY14 EBITDA EBITDA margin • FY13 EBITDA negatively impacted by one-off adjustm
Slide 22: Strong customer experience evidenced by leading NPS positions
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Strong customer experience evidenced by leading NPS positions #1 #2 Improving • Uzbekistan • Georgia • Armenia • Kyrgyzstan < 22>
Slide 23: Permanent improvements in networks
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Permanent improvements in networks Data network quality in right places is a key success factor to improve mobile data customer experience • Target congested sites • Mobile Quality in top revenue- Agents generating cities and • Analytic Base
Slide 24: Upgrading distribution to meet customer demands
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Upgrading distribution to meet customer demands Monobrand stores • New design concept for Monobrand stores in BU CIS is developed with implementation planned for 2015 • Georgia is the 1st BU CIS OpCo that launched new design store • Monobran
Slide 25: Differentiated pricing, focusing on mobile data
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Differentiated pricing, focusing on mobile data • Regional based pricing approach ► Specific parameters of countrywide tariff portfolio based on regional situation and needs of customers (international offers) Achieving • Beeline footprint r
Slide 26: Offering best value for money, benefiting from VimpelCom´s footprint
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Offering best value for money, benefiting from VimpelCom´s footprint < 26>
Slide 27: Partnership with OTT – key element to drive user adoption
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Partnership with OTT – key element to drive user adoption Leverage • Use Group scale to partner with top and upcoming OTT – benefit on centralize technology to enable CIS small OpCos global scale to benefit from group power (Group OTT Hub) T
Slide 28: Operational and Capital Efficiency: Value adding programs
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Operational and Capital Efficiency: Value adding programs Capital efficiency initiatives • Active RAN sharing – 28 sites in Tajikistan • Passive RAN sharing 36 sites with other operators over Georgia, Armenia and Kyrgyzstan • Implementation
Slide 29: Strengthening leadership position
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Strengthening leadership position • Improving or maintaining market position in highly competitive markets • Enhancing customer experience, focusing on NPS • Develop additional revenue streams and explore new growth capabilities • True focus
Slide 30: Thank you
Georgia & Kazakhstan Site Visit 2015 © VimpelCom Ltd. 2015 Thank you Questions please! < 30>
Slide 31: Georgia Analyst & Investor Site Visit
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Georgia Analyst & Investor Site Visit Giorgi Tkeshelashvili Chief Executive Officer < 31>
Slide 32: Georgia Site Visit 2015
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 < 32>
Slide 33: Georgia at a glance
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Georgia at a glance • Member of the Council of Europe • Association agreement with the European Union < 33>
Slide 34: Georgia at a glance
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Georgia at a glance Key facts Population • Population: 4.5 mln 1,634 1,220 867 474 502 296 <5 5 - 15 15 -25 25 - 40 40 - 60 60+ • Currency: GEL (Georgian Lari) • More then 80% of population are Georgians • Capital city: Tbilisi w
Slide 35: Georgia at a glance
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Georgia at a glance Tourism • Majority of visitors come from: ► Turkey: 30% ► Russia: 15% ► Armenia: 24% ► Number of EU tourists increased by 26% Tourism growth trend (million) 5.0 5.4 4.4 2012 2013 2014 Ski resorts Sea resorts S
Slide 36: Strong economic growth
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Strong economic growth GDP and real GDP growth YoY GDP per capita Unemployment rate (USD billion) (%) (USD) (%) 17.3 3,835 15.8 16.1 3,5233,597 12.3% 14.4 3,231 12.8 2,921 15.1% 9.6% 9.4% 11.6 2,623 15.0% 10.8 2,455 14.6% 10.2 7.
Slide 37: Well diversified economy
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Well diversified economy Components of national GDP (%) 9% 12% Agriculture, forestry and fishing 6% Industry 17% Construction 5% Trade Hotels and restaurants Transport and Communication 10% Financial intermediation 7% Public admi
Slide 38: Very liberal market
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Very liberal market Ease of doing business Economic freedom ranking Singapore 1 Up from 112 in 2005 Hong Kong 1 Up from 99 in 2005 United States 4 Denmark 5 United States 12 GEORGIA 8 United Kingdom 10 United Kingdom 14 Germany 2
Slide 39: Company at a glance
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Company at a glance 2006 2007 2011 2013 2015 • Beeline Georgia • Launch of Beeline • Annual revenue • Achieved 1 • 4G/LTE network was established 2G network reached GEL 100 million active launch million customer base At a glance
Slide 40: Telecom market development
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Telecom market development 1997 2005 2007 2011 2015 • Launch of GSM • Launch of 3G • Launch of Beeline • Mobile number • Technology operations in services by both 2G network portability neutrality Georgia by operators introductio
Slide 41: Telecom market development
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Telecom market development Total mobile active market customers Total market revenue (GEL million) CAGR CAGR 3% 3% 684 630 653 593 585 609 5.4 5.7 5.8 6.0 6.0 5.2 190 71 120 20 24 35 2014 2015 2016 2017 2018 2019 2014 2015 2016 2
Slide 42: Competitive overview
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Competitive overview Magticom Geocell High ARPU Mass Youth High ARPU Mass Mass Best Quality Simple, Cheap with All for youth Always the best price High quality and Innovative/ Affordable High quality status Source: Company estima
Slide 43: Beeline - The best 4G coverage
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Beeline - The best 4G coverage 4G coverage map 4G coverage Magticom 34% Geocell 8% Beeline 41% Technology distribution 2G CDMA 3G 4G/LTE Magticom Geocell Source: Georgian National Communications Commission < 43>
Slide 44: Company transformation strategy
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Company transformation strategy Commercial Technology • Improve image of Beeline – “New Beeline” with • IT development to support digital direction the fastest data • It solutions and products implementation • Value proposition –
Slide 45: Thank you
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Thank you Questions please! < 45>
Slide 46: Georgia Analyst & Investor Site Visit
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Georgia Analyst & Investor Site Visit Lasha Tabidze Chief Commercial Officer < 46>
Slide 47: 2G value proposition
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 2G value proposition Best value for money Price • Best value for money • Simplicity of products Product • Focus on bundle offers Service • Fast and friendly customer service • Network coverage below competition Connectivity • Gap
Slide 48: Growing customer market share
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Growing customer market share Retail revenue market share Customer market share (%) (1 month) 42.0% 42.4% 42.7% 42.8% 41.9% 42.5% 41.2% 39.8% 43.3% 43.8% 43.8% 44.1% 42.1% 41.6% 40.0% 39.2% 39.6% 38.8% 39.2% 38.3% 36.9% 36.5% 37.
Slide 49: Churn development
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Churn development Average 3 months active base churn 21.4% 21.3% 19.4% Main reasons for churn 16.5% 16.7% 16.4% 16.1% 15.9% • Network coverage below the competition • Absence of data speed • Tourist’s impact - seasonally high in
Slide 50: Strong growth in 2G mobile data
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Strong growth in 2G mobile data Data traffic Data users (TB million) (thousands) 253 428 378 385 132 110 2012 2013 2014 2012 2013 2014 Data revenue Smartphone penetration (GEL million) (%) 4,503 27% 4,174 3,878 14% 5% 2012 2013 2
Slide 51: Net Promoter Score improving versus competition
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Net Promoter Score improving versus competition NPS Relative NPS (Beeline’s gap to the best competitor) 58 57 50 48 49 44 36 -6 -7 -9 -12 -13 -17 -18 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 • 2nd in
Slide 52: We have changed – New Beeline
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 We have changed – New Beeline Fastest 4G/LTE Data at the Best Price 1.02.2015 < 52>
Slide 53: Georgia Site Visit 2015 Tbilisi, March 31 st 2015 © VimpelCom Ltd. 2015
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 < 53>
Slide 54: 4G/LTE Launch
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 4G/LTE Launch 4G/LTE products launched • 4G/LTE data bundles • 4G/LTE integrated bundles (voice, sms, data) • 4G/LTE smartphone's with installment • 4G/LTE: modems, wingles and routers with installment • Special price plan for he
Slide 55: Transforming value proposition – New Beeline
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Transforming value proposition – New Beeline Always the Best Price • Best price on local & international calls • Best price on data offers Price • Best price on devices & smartphones • Personalized & targeted offers • Simple prod
Slide 56: Georgia Site Visit 2015 Tbilisi, March 31 st 2015 © VimpelCom Ltd. 2015
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 < 56>
Slide 57: Key strategic directions
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Key strategic directions Increase 4G/LTE smartphone penetration Handset line – installment scheme- reverse bundling Increase 4G/LTE users Freemium/try&buy offers for non users Price Focus on bundled offers Shared bundle Multi dev
Slide 58: Stimulating 4G/LTE devices in monobrand shops
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Stimulating 4G/LTE devices in monobrand shops Smartphones line Integrated bundles Alcatel POP S3 Alcatel POP S7 Alcatel POP S9 Alcatel POP 2 WiFi modems & routers Alcatel POP S7 • Handset line – installment scheme - reverse bundl
Slide 59: Wide diversity of data and integrated bundles
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Wide diversity of data and integrated bundles Data bundles Integrated bundles 600 3 4 150 500 500 5 1 GB Min SMS MB MB 9 15 250 1500 1 10 4 GB 7 GB Min SMS GB 20 25 500 5000 1 15 10 GB 30 GB Min SMS GB Unlim Unlim 2 20 45 Min SMS
Slide 60: Upgrading monobrand stores
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Upgrading monobrand stores Re – branding of monobrand stores • New store concept Current store New concept New concept ► Modern ► Innovative ► Stylish ► High tech ► Focused on self care ► Digital service < 60>
Slide 61: Stimulating digital sales
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Stimulating digital sales Pay Box Web page • Pay Box – used for paying different types of • Web page/M web page – possibility to bills in just 2 minutes. Easy to reach as they buy/activate any service of Beeline Georgia are locat
Slide 62: Introducing digital services
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Introducing digital services Device installment through web page Beeline self-care App Process • Application enables customer to ► Check and manage personal account • Customer fills online ► Airtime time top up application ► Purc
Slide 63: Thank you
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Thank you Questions please! < 63>
Slide 64: Georgia Analyst & Investor Site Visit
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Georgia Analyst & Investor Site Visit Alexander Gorodilov Chief Financial Officer < 64>
Slide 65: Double-digit growth in revenue and EBITDA prior to 2014 despite technology gap
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Double-digit growth in revenue and EBITDA prior to 2014 despite technology gap Revenue EBITDA and EBITDA margin (GEL million) (GEL million and %) 30.4% 27.4% 25.1% 147 22% 14% 140 45 35 35 -5% 125 2012 2013 2014 2012 2013 2014 Re
Slide 66: Challenging 2014 due to technology gap
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Challenging 2014 due to technology gap Revenue ARPU and MOU (GEL million) (GEL and minutes) 253 251 250 239 226 226 230 214 36 40 38 37 39 33 33 31 10.4 10.9 11.0 10.1 9.2 8.7 8.5 8.2 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q13
Slide 67: Challenging 2014 due to technology gap
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Challenging 2014 due to technology gap EBITDA 2014 vs 2013 (GEL million) Comments 45 35 • EBITDA 2014 impacted by technology gap and disappearance of EBITDA 2013 Technology Disappearance Business costs Other EBITDA 2014 asymmetri
Slide 68: Operational Excellence supporting profitability
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Operational Excellence supporting profitability Top-up comissions optimizations • Continuous Operational Excellence Utilities and maintenance costs program delivering strong results in optimizations 2014 Electricity and site shar
Slide 69: Relatively stable Georgian Lari performance
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Relatively stable Georgian Lari performance Currency devaluation LCY vs USD, 4Q14 vs 4Q13 (%) 45% 31% 15% 14% 9% 8% 7% 6% 6% 0% -5% Ukrainian Russian Kazakh Kyrgyz Uzbekistan Euro Georgian Armenian Algerian Bangladeshi Pakistan H
Slide 70: Improving working capital in 2014
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Improving working capital in 2014 Working capital development (GEL million) • Negotiations with suppliers to improve payment terms • Commercial actions to stimulate prepaid balances - Beeline lottery, 4 customer equipment with pr
Slide 71: Conclusion
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Conclusion • 2014 results impacted significantly by: ► Technology gap ► Disappearance of local MTR asymmetry • Revenue, EBITDA and FCF growth opportunities post 4G/LTE launch supported by: ► Market share growth opportunities ► Da
Slide 72: Thank you
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Thank you Questions please! < 72>
Slide 73: Georgia Analyst & Investor Site Visit
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Georgia Analyst & Investor Site Visit George Shamanadze Chief Technological Officer < 73>
Slide 74: Introduction
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Introduction • Overview of current network: 2G network, KPI’s, backbone, backhauling and 4G/LTE network roll out. License specifications (frequencies) • 4G/LTE network roll out strategy, CAPEX strategy • Download/upload speed of
Slide 75: Growing network
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Growing network 2007 2009 2011 2014 2G 2015 2016 Key Facts: • Population - 4,490mln 4G/ • Area - 69,700 km2 LTE • Population coverage 2G – 85% • Widest pop. coverage 4G/LTE – 41% < 75>
Slide 76: Spectrum distribution
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Spectrum distribution 4G/LTE Beeline Geocell Magticom 2G CDMA 3G 4G/LTE 800 10 0 0 (2xMhz) Magticom 900 (2xMhz) 0 0 0 Geocell 1800 (2xMhz) 0 20 10 2100 0 0 0 (2xMhz) 2600 0 0 0 (2xMhz) • Beeline had no opportuni
Slide 77: High quality 2G network
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 High quality 2G network • Main KPI dynamics & targets: Network quality in 2014 ► Call unsuccessful rate < 1.8% 2.5 ► Call drop rate < 0.8% 2 ► Congestion < 1% 1.5 1 Best quality 0.5 0 network Call Unsuccessful call Call Drop Ra
Slide 78: 4G/LTE coverage obligation
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 4G/LTE coverage obligation • Provide 4G/LTE services in all municipalities with population <5,000 under the terms as follows: Ensure accessibility to the service in the minimum: 30% of the 1. Till February 1, 2016 municipalities
Slide 79: Current 4G/LTE coverage
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Current 4G/LTE coverage • >30 cities all over Georgia • Coverage >92% of population in each city • 41% of population covered, 1.78 million people • Minimum 512 Kb/s cell edge uplink • 211 sites total launched in 3 days after lice
Slide 80: Only operator with fiber optic backbone
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Only operator with fiber optic backbone < 80>
Slide 81: Only operator with 4G/LTE fiber optic backhaul
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Only operator with 4G/LTE fiber optic backhaul • 3 biggest Cities, Tbilisi, Kutaisi and Batumi covered by fiber optic backhaul • Total: ► Tbilisi - 188km ► Kutaisi - 35km ► Batumi – 42km < 81>
Slide 82: Beeline offers best coverage and speed in 4G/LTE in Tbilisi
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Beeline offers best coverage and speed in 4G/LTE in Tbilisi Beeline Operator 1 Operator 2 Avg speed – 19.2Mb/s Avg speed - 10.3Mb/s Avg speed - 12.6Mb/s Best coverage & speed by Poor coverage by Poorest coverage by 10Mhz spectrum
Slide 83: Electricity and site sharing
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Electricity and site sharing • Beeline Georgia initiated electricity sharing in 2008, the first in BU CIS and Georgia with Magticom (7 sites) and Geocell (20 sites). Approximately USD 360K savings per annum in OPEX and USD 550K i
Slide 84: Beeline mobile base stations
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Beeline mobile base stations • In 2008, Beeline launched as the first in Georgia mobile base stations (vehicle based) for resorts, congested and touristic areas < 84>
Slide 85: Alternative energy systems
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Alternative energy systems • In 2010, Beeline Georgia was the first in BU CIS and Georgia who deployed solar systems, approximately USD 11K per site savings on fuel per annum • 30 solar systems to be deployed in 2015 • ~10% savin
Slide 86: Thank you
Georgia Site Visit 2015 Tbilisi, March 31st 2015 © VimpelCom Ltd. 2015 Thank you Questions please! < 86>