Telekom Austria Ag · VIE:TKA
Telekom Austria — Investor Presentation (September 2023)
34 slides from Telekom Austria's investor presentation, September 2023
Slide 1: Investor Presentation September 2023
Investor Presentation September 2023
Slide 2: Cautionary statement
Cautionary statement This presentation contains forward-looking statements. These forward-looking statements are usually accompanied by words such as ›believe‹, ›intend‹, ›anticipate‹, ›plan‹, ›expect‹ and similar expressions or by ›outlook‹. Actual events may differ materially from those anticipate
Slide 3: Promoting a more sustainable way of life through digitalization
Promoting a more sustainable way of life through digitalization • Leading telco across CEE • System-critical infrastructure: fixed-line and mobile networks, data centers • Leverage the potential provided by megatrend digitalization • Strong growth performance, solid balance sheet • Well-balanced per
Slide 4: Regional coverage
Regional coverage Inhabitants GDP/capita Mobile subscribers RGUs (million; market position) (million; market position) (million) (in $) Austria 9.0 67,900 5.2 #1 2.9 #1 Bulgaria 6.5 33,600 3.8 #1 1.2 #2 Croatia 3.9 40,400 2.0 #2 0.7 #2 Belarus 9.2 22,600 4.9 #2 0.8 #2 Serbia 6.8 23,900 2.4 #3 - Slov
Slide 5: Strategy
Stra tegy 5 Investor presentation | September 2023
Slide 6: Trends that influence telcos and A1's strategy
Trends that influence telcos and A1’s strategy Broadband Competitive rollout is landscape is ESG aspects Data traffic progressing expanding a mandatory growing requirement to strongly compete in the market AI and the Sustainability Ecosystems Telcos enable a factor in are future analytical use of ac
Slide 7: Key performance drivers
Key performance drivers IT services e.g., applications, data centers, analytics Security Unified B2B data/mobile/object security Brand Digital Communication e.g., private branch exchange, healthcare Integrated sector solutions e.g., smart metering, IoT Commercial One excellence company Upselling the
Slide 8: Strategy follows the vision: Empowering digital life
Strategy follows the vision: Empowering digital life Evolve the core Explore the new • From network to connectivity plus • Scaling-up the portfolio Take Learn & • From product driven to customer ownership innovate • Develop eco-systems and journey focused partnerships to enrich capabilities • Operat
Slide 9: Towers spin-off
Towers spin-off
Slide 10: What is included in the Transaction
What is included in the Transaction Passive Infrastructure > Transferred to EuroTeleSites Active Infrastructure > Retained by A1 Site on rooftop Site on the ground Aircraft warning Lightning Protection lights system Electrical Distribution Radio Antennas System Technic RRUs or tower mounted amplifie
Slide 11: A1's tower business is an attractive business in its own right, but not a core A1 business
A1’s tower business is an attractive business in its own right, but not a core A1 business Cornerstones of the A1 tower business • A1 tower business (excl. Belarus) to be spun-off in 2023. • EuroTeleSites is planned to be listed on Vienna Stock Exchange. Planned listing day: September 22, 2023 KPIs
Slide 12: Transaction rationale | Advantages for main stakeholders
Transaction rationale | Advantages for main stakeholders Shareholders • Focus on core telecoms • Increased flexibility to drive • Higher multiples commercialisation business • A1 with sustainable dividend • Efficient budget allocation • Leaner structures for efficient policy management • Reduction o
Slide 13: Situation post proportionate spin-off
Situation post proportionate spin-off (simplified representation) ÖBAG América Móvil Other ÖBAG América Móvil Other 28.4% 56.6% 15.0% 28.4% 56.6% 15.0% EuroTeleSites AG Telekom Austria AG A1 Towers Holding GmbH Towers Austria Towers A1 A1 A1 North Towers Towers Towers Towers A1 Austria A1 Croatia A1
Slide 14: Future legal relationship of A1 Group and EuroTeleSites
Future legal relationship of A1 Group and EuroTeleSites Providers A1 will remain closely associated with ▪ A1 is free to choose tower providers, EuroTeleSites as its anchor tenant whether EuroTeleSites or 3rd TowerCos ▪ Contract Duration: indefinite, ▪ However, A1 currently plans to roll out however
Slide 15: Effects of the spin-off on A1 Group (annualized view)
Effects of the spin-off on A1 Group (annualized view) Balance Sheet Profit & Loss Cash Flow Financial debt: Reduced by € 1 bn Revenue: -0.2% Free cash flow: from transfer of third-party tower rentals to EuroTeleSites Lower by € 60 mn per year (average) Total assets: +7% Mainly due to higher lease li
Slide 16: Financials
Finan cials 16 Investor presentation | September 2023
Slide 17: Recent financial performance
Recent financial performance (Unless otherwise stated, in € mn) Revenues EBITDA Free cash flow* +8% +4% -67% 5,005 1,838 37.4% 603 36.1% 2,375 2,557 368 36.7% 889 922 123 2022 H1 H1 2022 H1 H1 2022 H1 H1 2022 2023 2022 2023 2022 2023 EBITDA margin * 2023 incl. € 110 mn investments in frequencies (20
Slide 18: Well-balanced performance across geographic footprint
Well-balanced performance across geographic footprint Revenue split (H1 2023) Growth driver CEE EBITDA split (H1 2023) Bulgaria 14% Bulgaria 16% +13.2% Croatia Croatia 9% 9% Belarus Belarus 9% 11% International Slovenia Slovenia 5% +2.9% 3% Serbia Serbia 7% Austria 7% Austria N-Macedonia Austria N-M
Slide 19: Sustainable growth and strong free cash flow development
Sustainable growth and strong free cash flow development (Unless otherwise stated, in € mn) Revenues consistently growing EBITDA increased significantly Robust free cash flow CAGR CAGR CAGR 2.7% 3.4% 9.4% 5,005 4,565 4,549 4,748 4,383 4,435 1,838 1,706 603 1,555 1,549 1,561 1,577 504 487 385 384 344
Slide 20: A1 has decreased net debt significantly
A1 has decreased net debt significantly (Unless otherwise stated, in € mn) Robust free cash flow Sustainable dividend policy Net debt reduction 0.95 CAGR EPS 9.4% FCF/share 0.76 0.73 0.90 0.58 0.58 0.58 2.3x 0.51 0.68 2.0x 603 0.58 1.7x 504 487 0.35 0.48 0.36 0.49 1.9x 1.3x 0.32 1.7x 1.3x 385 384 0.
Slide 21: Strong growth performance within peer group in Europe
Strong growth performance within peer group in Europe Revenues, CAGR EBITDAaL adj., CAGR Standard & Poor’s rating 2017-2022 2019-2022 2017-2022 2019-2022 A1 Group 2.7% 3.1% 2.7% 6.0% Telia (SEK) AA+ AA Orange AA- Telenor (NOK) A+ A Swisscom + Proximus A1 Group A- Telenor + Telefonica BBB+ Orange DT
Slide 22: The share
The share 22 Investor presentation | September 2023
Slide 23: Shareholder structure
Shareholder structure Two strong shareholders ÖBAG (Österreichische Beteiligungs AG) • ÖBAG: independent holding company of state assets. ÖBAG 28.4% Mission is to preserve and grow its investments for generations. Retail 3.3% • Investment portfolio includes also: OMV, Verbund, Post, Casinos Austria,
Slide 24: Syndicate agreement between América Móvil and ÖBAG
Syndicate agreement between América Móvil and ÖBAG On February 6, 2023, both parties agreed on a new syndication agreement with a term of 10 years. The publicly known cornerstones of this agreement are the following: General • Headquarters to remain in Austria • Commitment to the listing at the Vien
Slide 25: Share price
Share price AT0000720008 Tela.VI TKA AV Institution Rating Price (€) • Shares outstanding: 664,084,841 AlphaValue/Baader Europe Buy 9.98 • Listing: Vienna Stock Exchange Bank Pekao Buy 8.50 130 Barclays Neutral 7.60 120 Citigroup suspended suspended 110 Erste Group Bank Buy 8.50 100 HSBC Buy 8.00 90
Slide 26: Sustainability
Sustain ability Source Sustainalytics. THE USE BY TELEKOM AUSTRIA OF ANY MSCI ESG Sustainalytics, a Morningstar RESEARCH LLC OR ITS AFFILIATES (“MSCI”) DATA, AND company, is a leading THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS independent ESG research, OR INDEX NAMES HEREIN, DO NOT CONSTITUTE
Slide 27: ESG: 2023 strategy update – key objectives
ESG: 2023 strategy update – key objectives CO2 emissions Energy efficiency Recycle/Refurbish Waste reduction Product reuse E Net-Zero by 2030 80% 20% Zero-waste to landfill Pilot project Scope 1&2: -90% Increase energy efficiency to Increase percentage of recycled Obtain carbon trust “Zero waste Lau
Slide 28: Outlook
Out look 28 Investor presentation | September 2023
Slide 29: Outlook for FY 2023
Outlook for FY 2023 Consensus 2023 Guidance 2023 (July 2023) € 5,224 mn Total revenues Around +5% (+4.4% vs FY22) CAPEX (excl. spectrum, M&A) Around € 950 mn € 966 mn • Revenues: – Main growth drivers: value-protecting pricing measures, upselling in the retail business, development of Solutions & Co
Slide 30: A1 ambitions 2024-2026
A1 ambitions 2024-2026 Revenues EBITDA CAPEX 3-4% increase p.a. 4-5% increase p.a. € 2.8 bn plus frequencies Based on current inflation and exchange rate expectations Based on current inflation and exchange rate expectations Dividend baseline € 0.32 Based on the Group's operational and financial dev
Slide 31: Appendix
App endix 31 Investor presentation | September 2023
Slide 32: Conservative financial policy, investment-grade ratings
Conservative financial policy, investment-grade ratings Overview (June 30, 2023) Lines of credit (June 30, 2023) Creditratings Credit ratings Moody's S&P Fitch • Total financial debt:€ 1,967 mn • Total committed lines: € 1,890 mn Avg. term to maturity: 2.36 years • Average cost of debt: 2.97% A- A-
Slide 33: Management Board
Management Board Deputy CEO CEO Alejandro Plater (*1967, Argentina) Thomas Arnoldner (*1977, Austria) • Board member since August 2015 • Board member since September 2018 o 2015-2018 as CEO, 2018-2023 as COO o 2018-2023 as CEO • Before A1, senior roles at Ericsson • Before A1, board functions at Alc
Slide 34: Hans Lang, Head of Investor Relations
Hans Lang Head of Investor Relations E investor.relations@a1.group M +43 50 664 47500
Telekom Austria — Investor Presentation (September 2023) on 6ix