Slide 1: Este documento está clasificado como USO INTERNO por TELEFÓNICA. This document is classified as
***Este documento está clasificado como USO INTERNO por TELEFÓNICA. ***This document is classified as INTERNAL USE by TELEFÓNICA.
Slide 2: Disclaimer
Disclaimer This document and any related conference call or webcast (including any related Q&A session) has been prepared by Telefónica, S.A. (hereinafter “Telefónica” or “the Company”, and together with its subsidiaries the “Telefónica Group”) exclusively for its use during the presentation of fina
Slide 3: Q2 24 Summary
Q2 24 Summary Mr. José María Álvarez-Pallete Chairman & CEO ***Este documento está clasificado como PUBLICO por TELEFÓNICA. ***This document is classified as PUBLIC by TELEFÓNICA.
Slide 4: Strong Q2 results confirm that our strategy is working
Strong Q2 results confirm that our strategy is working Strong commercial performance; accelerating growth in all main accesses in Spain and Germany; record customer levels in Brazil Accelerated growth; revenue +1.2% y-o-y, sequential improvement driven by B2B and B2C growth Robust operating cash flo
Slide 5: Telefónica Group: improved growth momentum in Q2
Telefónica Group: improved growth momentum in Q2 • Revenue improved sequentially Service B2B B2C Growth • Main markets growing in revenue Revenue Revenue Revenue Revenue • Fibre at full speed; premisses passed +13% y-o-y +1.2% y-o-y +2.2% y-o-y +4.9% y-o-y +1.8% y-o-y • Acceleration in EBITDAal-CapE
Slide 6: Stronger Telefónica
Stronger Telefónica Enhanced Next Generation Leaner CUSTOMER NETWORKS OPERATIONS experience focus • More fiber: 78.9m PPs, +2.3m q-o-q • Customers growth to 392m, +4m q-o-q • Switching-off legacies; 4.3k Spain COs closed • More 5G: +3p.p. q-o-q coverage in core markets • Enriched offering, digital e
Slide 7: Global leader in ESG
Global leader in ESG Environmental Social Governance • Newly updated Climate Action Plan • Digital inclusion: 392m accesses with • Updated AI principles: to reinforce approved by the Board outlining our conscious effort to connect people responsibility across the value chain decarbonisation roadmap
Slide 8: Q2 24 Geographies & Units
Q2 24 Geographies & Units Mr. Ángel Vilá COO ***Este documento está clasificado como PUBLICO por TELEFÓNICA. ***This document is classified as PUBLIC by TELEFÓNICA.
Slide 9: Strong Q2 execution
Strong Q2 execution In Q1 we Said Where we Stand • New long-term mobile network MOU signed ✓ Announced 16-year definitive agreement with DIGI with DIGI ✓ NB MoU signed with VOD Spain for the creation of a FibreCo • Negotiation underway on a potential ✓ Agreement reached with ANATEL / Ministry of Com
Slide 10: Spain: continued positive trading, revenue and profitability
Spain: continued positive trading, revenue and profitability Net adds (k) Convergent KPIs Highlights FBB Postpaid Convergent Pay TV ARPU (€) Churn (%) +0.2% y-o-y 69 • Continued growth in main accesses 62 24 43 28 12 12 3 7 17 26 22 91.5 90.6 91.2 92.2 91.7 • Striking the right balance in convergent
Slide 11: Spain: value creation whilst co-shaping the wholesale market
Spain: value creation whilst co-shaping the wholesale market Long term wholesale agreement signed with DIGI NB MoU with Vod Spain to create a joint FibreCo High Bands • c.3.5m FTTH PP coverage; c.40% take-up target 3.5 GHz, 2.1 GHz, 1.8 GHz RAN • Long term MSA for both partners T. España (175 MHz) S
Slide 12: Brazil: expanding profitable growth
Brazil: expanding profitable growth Accesses growth (y-o-y) FTTH Premises passed (m) Contract FTTH Highlights Mobile contract m.s 43.1% • Increased customer value: ARPU ↑ & churn ↓ 29 26.2 26.8 27.3 • Improving FTTH take-up (24.0%) 25.1 15% 14% 13% 12% 7% 13% • 1.8m Vivo Total (FTTH+mobile offer): >
Slide 13: Germany: robust trading momentum and growing profitability
Germany: robust trading momentum and growing profitability Contract net adds (k) FBB net adds (k) 396 Highlights 302 31 284 22 • Strong commercial traction, contract NA +37% q-o-q 215 1 157 1 • Low O2 contract churn 0.9% 13 • Revenue flat y-o-y: growth in handsets sales and 3 fixed offsetting lower
Slide 14: VMO2: focus on operational progress and long-term growth
VMO2: focus on operational progress and long-term growth Fixed network build (k PPs) Mobile contract churn (%) UBB PPs Highlights 17.5m 299 295 • Full fibre milestone of 5m PPs 251 • 5G coverage reaching c. 2/3 of the UK population 175 194 1.2% 1.2% • Fixed ARPU returned to growth (+3.1% y-o-y) 1.2%
Slide 15: T. Tech, the B2B growth driver with top execution
T. Tech, the B2B growth driver with top execution Revenue Enhanced profile € million y-o-y • Double-digit growth in revenue to accelerate in H2 11.0% 11.2% 11.1% • Since creation delivering quarterly double-digit growth • +20% bookings growth vs. H1 23; growing faster than revenue 984 €2bn • Large r
Slide 16: T. Infra, a worldwide connectivity network
T. Infra, a worldwide connectivity network Accelerating FTTH deployment Global connectivity provider Total FTTH Premises Passed (m) ~30 23 Consistent profitability Continued traffic growth 19 c. 50% +13% EBITDA margin vs. H1 23 H1 24 Jun-23 Jun-24 2026E ̴30% of 23-26 of TEF’s FTTH rollout Expanding
Slide 17: Q2 T. Hispam / Financial position
Q2 24 T. Hispam / Financial position Mrs. Laura Abasolo CFCO & Head of T. Hispam ***Este documento está clasificado como PUBLICO por TELEFÓNICA. ***This document is classified as PUBLIC by TELEFÓNICA.
Slide 18: Hispam: back to growth in financial metrics
Hispam: back to growth in financial metrics Accesses growth (y-o-y) FTTH & Cable PPs (m) 17.9m FTTH Highlights Contract FTTH & Cable Leading the market 20.3 20.9 21.6 • Avoiding network overlaps in the region 18.6 19.5 16% 12% • Extension of the agreement with AT&T in MEX 8% 6% 4% • FTTH sharing agr
Slide 19: FCF on track, 2024 guidance reaffirmed
FCF on track, 2024 guidance reaffirmed FCF phasing fully aligned through H2 24; always back-end loaded € million Ex tax resolution payment in Peru FCF 2024 2023 2024 2,308 >10% growth FCF CAGR 23-26 >10% growth 358 349 205 163 (9) (41) Q1 Q2 H1 FY • Like-for-like1 FCF growth robust; > 20% y-o-y in Q
Slide 20: Solid balance sheet, contained costs and long average life
Solid balance sheet, contained costs and long average life Net Financial Debt € million ND/EBITDAaL ND/EBITDAaL 2.60x 2.78x (118) 1,057 29,240 27,349 997 (45) Leverage reduction Dividend cash T. DE stake to €0.15/sh. 96.85% 2026: 2.2x-2.5x FCF Shareholder Net financial FX & Dec-23 Jun-24 including s
Slide 21: Key takeaways
Key takeaways Mr. José María Álvarez-Pallete Chairman & CEO ***Este documento está clasificado como PUBLICO por TELEFÓNICA. ***This document is classified as PUBLIC by TELEFÓNICA.
Slide 22: 2024 guidance fully confirmed
2024 guidance fully confirmed H1 On Track 2024 Guidance 2023-26 CAGR to Deliver Revenue y-o-y reported ~1% +1.1% ✓ ~1% EBITDA y-o-y reported 1% to 2% +1.9% ✓ ~2% EBITDAaL - CapEx y-o-y reported 1% to 2% +3.1% ✓ 5% CapEx / Sales Up to 13% 11.3% ✓ <12% FCF y-o-y reported >10% €163m ✓ >10% €0.3/share I
Slide 23: Pathway to industry leading <12% capex to revenues
Pathway to industry leading <12% capex to revenues CapEx/Sales (ex-spectrum) • Open disaggregated networks • Past peak network spending • Virtualisation & go-to-cloud • Tech cycle optimisation • AI & automation • Coinvesting with partners 13.3% <12% Network Strategic Optimisation Investments Busines
Slide 24: Building on our momentum
Building on our momentum 1 Very solid Q2 results; consistent with 2024 guidance (reiterated) and 2023-2026 plan 2 Better sequential trends; accelerated growth in Revenue and EBITDAaL-CapEx back to growth; operating leverage increasing 3 Commercial & financial performance unabated in Spain, Brazil &
Slide 25: Results presentation and Q&A Session
Results presentation and Q&A Session Telefónica’s management will host a webcast on 31 July at 10:00 AM (CEST), 9:00 AM (BST), and 4:00 AM (EDT) Participants from Telefónica • José María Álvarez-Pallete l Chairman & CEO • Lutz Schüler l CEO Virgin Media O2 • Ángel Vilá l COO • Eduardo Navarro l Chie
Slide 26: For further information, please contact
Climate A Bloomberg Member of DJSI 1st in sector 1st company worldwide in 2023 List 2023 GEI 2023 Europe 2022 Digital Inclusion Benchmark For further information, please contact: Investor Relations FOLLOW US: Adrián Zunzunegui (adrian.zunzunegui@telefonica.com) Isabel Beltrán (i.beltran@telefonica.c