Slide 1: Interim Report Q3 2019
Q3 2019 Interim Report Q3 2019 17 OCTOBER 2019
Slide 2: Q3 2019 highlights
INTERIM REPORT Q3 2019 Q3 2019 highlights • Revenue grew by 2% • EBITDA up by 6% • Mobile service revenue growth 2.3% • Post-paid voice churn slightly up from 18.0% to 18.2% • Post-paid mobile subscription base increased by 18,500 and fixed broadband grew by 8,100 • Early adopters embraced 5G, alrea
Slide 3: Solid growth despite keen competition
INTERIM REPORT Q3 2019 Solid growth despite keen competition Revenue Mobile service revenue Revenue, €m YoY change.% MSR, €m YoY change,% Increase • 4G up-selling 2,4% 1,5% 2,1% 1,9% 2,3% 1,1% continues 0,0% -0,4% -2,2% -1,3% • Polystar • Mobile services • Product changes • Equipment sales 454 471 4
Slide 4: Solid growth in both segments
INTERIM REPORT Q3 2019 Solid growth in both segments Consumer Customers Revenue and EBITDA1) Revenue, €m EBITDA, €m EBITDA-% Revenue +2% + Mobile and digital services + Equipment sales 38% 38% 37% 40% 35% - Interconnection and roaming prices - Traditional fixed services 289 109 296 104 273 105 282 1
Slide 5: Strategy execution
INTERIM REPORT Q3 2019 Strategy execution Increase mobile and fixed service revenues Grow digital service businesses Improve efficiency and quality 5
Slide 6: Steady growth in 4G and up-selling continues
INTERIM REPORT Q3 2019 Steady growth in 4G and up-selling continues Growth in 4G smartphone penetration Smartphone and 4G speed penetration,% Smartphone penetr.1) 4G speed penetr.2) 4G 50 Mbps penetr.2) • 84% of customers use a smartphone 82% 83% 84% 84% 78% 79% 80% 80% 81% 77% – 98% (95%) 4G-capabl
Slide 7: Early adopters embraced 5G, already thousands of customers
INTERIM REPORT Q3 2019 Early adopters embraced 5G, already thousands of customers • First in the world: 5G roaming agreement between Elisa and Swisscom up and running • New 300 Mbps 5G subscription introduced • New forerunner customers in 5G : Port of Helsinki offers 5G services to its passengers, v
Slide 8: Expansion of digital service businesses continued
INTERIM REPORT Q3 2019 Expansion of digital service businesses continued Domestic digital services International digital services • Internationally recognized original series • Videra continues to build up its partner Shadow Lines had world premiere at end of network for improved coverage and servic
Slide 9: Upgraded outlook and guidance for 2019
INTERIM REPORT Q3 2019 Upgraded outlook and guidance for 2019 The positive development of the macroeconomic environment is decelerating in Finland. Competition remains challenging. • Revenue at same level or slightly higher than in 2018 • Comparable EBITDA slightly higher than in 2018 • CAPEX maximu
Slide 10: Financial performance
Q3 2019 Financial performance INTERIM REPORT Q3 2019
Slide 11: Growth in revenue and EBITDA
INTERIM REPORT Q3 2019 Growth in revenue and EBITDA EUR million 1) Q3/19 Q3/18 Change % Q3 2019 revenue change YoY, €11m Revenue 465 454 11.0 2.4 % Other operating income 1 2 -0.9 -47.8 % 3 -4 Materials and services -172 -173 0.8 -0.5 % Employee expenses -74 -70 -4.1 5.9 % 8 Other operating expenses
Slide 12: Strong performance in Estonia
INTERIM REPORT Q3 2019 Strong performance in Estonia • Revenue and EBITDA improved Revenue Revenue, €m YoY change, % 6,7% – Revenue growth +6.7% 6,0% 5,2% – EBITDA growth +8.5% 1,2% – Mobile and fixed services growing -3,2% 41,7 44,6 40,4 42,2 44,5 • Good growth in subscriptions Q3/18 Q4/18 Q1/19 Q2
Slide 13: CAPEX in line with guidance
INTERIM REPORT Q3 2019 CAPEX in line with guidance • CAPEX €56m, excl. IFRS 16 change CAPEX1) €52m (49) CAPEX / sales1) % 11% 14% 12% 12% 11% – Consumer €38m (33) – Corporate €18m (16) 66 49 51 55 52 • Main CAPEX areas Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 – 4G capacity and coverage increases Shares, licenc
Slide 14: Strong growth in cash flow
INTERIM REPORT Q3 2019 Strong growth in cash flow • Cash flow €97m (87), comparable Cash flow and comparable cash flow, €m €98m 102 98 85 – Comparable cash flow growth +15% 58 – Higher EBITDA, change in NWC 87 97 52 68 – IFRS 16 impact +€4m 37 – Higher CAPEX Q3/18 Q4/18 Q1/19 Q2/19 Q3/19 Q2/19 compa
Slide 15: Efficient capital structure and good returns
INTERIM REPORT Q3 2019 Efficient capital structure and good returns • Capital structure according to target Net debt Net debt, €m Net debt / EBITDA – Net debt / EBITDA 1.9× (target 1.5–2×) 1,8 2,0 1,8 1,7 1,9 – Equity ratio 37.6% (target >35%) 1 235 1 124 1 073 1 068 962 – IFRS 16 impact on assets a
Slide 16: Q&A
Q&A
Slide 17: P&L by quarter
APPENDIX P&L by quarter EUR million Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Q2/18 Q1/18 Q4/17 Revenue 464.9 451.6 439.7 470.6 453.9 457.5 449.6 472.5 YoY growth 2.4 % -1.3 % -2.2 % -0.4 % 0.0 % 2.8 % 8.1 % 8.9 % Other operating income 0.9 1.1 0.7 0.9 1.8 6.0 1.1 2.6 Materials and services -172.1 -168.8 -160.5
Slide 18: Cash flow YoY comparison
APPENDIX Cash flow YoY comparison EUR million Q3/19 Q3/18 Change1) 2018 EBITDA 179 169 10 640 Change in receivables -2 -23 21 6 Change in inventories -1 2 -3 3 Change in payables -9 2 -11 -30 Change in NWC -12 -20 8 -21 Financials (net) -1 0 -1 -17 Taxes for the year -17 -17 0 -69 Taxes for the prev
Slide 19: Cash flow by quarter
APPENDIX Cash flow by quarter EUR million Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Q2/18 Q1/18 Q4/17 EBITDA 179 159 155 158 169 160 153 151 Change in receivables -2 5 9 4 -23 19 7 -33 Change in inventories -1 -1 6 -7 2 1 7 -5 Change in payables -9 5 -7 -1 2 -5 -26 36 Change in NWC -12 10 8 -4 -20 15 -12 -1 Fin
Slide 20: Debt structure
APPENDIX Debt structure EUR million at the end of the quarter Q3/19 Q2/19 Q1/19 Q4/18 Q3/18 Q2/18 Q1/18 Q4/17 Bonds and notes 943 941 939 767 766 764 763 767 Commercial paper 65 80 10 107 179 267 151 115 Loans from financial institutions 290 290 250 250 200 205 205 209 Financial leases 1) 92 93 90 2
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