Slide 1: Full-Year 2014 Preliminary Results Conference Call Presentation
Telecom Argentina Full--Year 2014 Preliminary Results Full Conference Call Presentation
Slide 2: Disclaimer
Disclaimer This presentation may include statements that could constitute forward-looking statements, including, but not limited to, the Company’s expectations for its future performance, revenues, income, earnings per share, capital expenditures, dividends, liquidity and capital structure; the impa
Slide 3: Agenda
Agenda Market Overview Business Highlights Financials Q&A 2
Slide 4: Economic outlook: Activity + Imports restriction + Reserves
Economic outlook: “Activity + Imports restriction + Reserves” Economic activity per sector Wages Central Bank Reserves Total National Wages - ∆ % YoY Central Bank Reserves (Billion US$) Electricity, gas & water Social services & Healthcare Public Admin & Defense Minery 33.9% 46.4 43.3 Construction 2
Slide 5: Agenda
Agenda Market Overview Business Highlights Financials Q&A 4
Slide 6: Business Highlights
Business Highlights Internet Mobile users +15% YoY (Usage +69%, ARPU+31%) Broadband wireline subs +4% YoY (10 Mb subs 16% of CB vs. 7% in 4Q13) Spectrum Auction payment: the equivalent of US$410.7 million for Business the remaining 3G bands to complete 50MHz Cap and for AWS bands Aggressive 4G rollo
Slide 7: Consolidated revenue growth fostered by Data, Internet & Handsets
Consolidated revenue growth fostered by Data, Internet & Handsets Evolution of revenues FY13 – FY14 IFRS, Million of AR$, Percentage +6,054; +22% Impact of SMS billing per second -257MM; -5% 1,794 426 33,341 -27 580 454 1,247 340 507 733 27,287 FIXED MOBILE IN ARGENTINA NUCLEO YoY Variation +10% +53
Slide 8: Mobile – New Offers continue to show encouraging trends
Mobile – New Offers continue to show encouraging trends Postpaid Postpaid AR$/Month Results of DIA FULL ARPU4 Black +29% Stabilizing CB ARPU accretive 169.4 131.8 ~50% of Gross Adds Other in Dec 2014 Postpaid 4Q13 4Q14 Prepaid Results of Superchip Prepaid AR$/Month Prepaid Stabilizing CB ARPU4 oct n
Slide 9: Mobile Argentina – Growth of mobile internet
Mobile Argentina – Growth of mobile internet CUSTOMER USAGE ARPU 308.8 Internet Users (Monthly unique users) Data Usage (MB/month) Browsing ARPU (ARS/month) FY13 +31% +15% 178.5 7.7 FY14 46.1 6.7 81.1 49.6 35.2 4Q13 4Q14 Prepaid Postpaid 4Q13 4Q14 GROWTH ENABLERS HANDSETS OFFERING NETWORK S-phone S-
Slide 10: Mobile – 4G competitive edge
Mobile – 4G competitive edge Competitive advantage in Outstanding Results in the An aggressive plan to surf AWS Spectrum first Launch the wave Initial Network Rollout Rollout:: Network Modernization More than 180 sites Within 18 months: installed in: Buenos Aires Single RAN in ~100% of sites Córdoba
Slide 11: Fixed - Growth of BB/UBB thanks to service provisioning and competitive offer
Fixed - Growth of BB/UBB thanks to service provisioning and competitive offer BB BB ARPU Accesses Thousand of broadband accesses, thousand of net adds & Churn AR$/Month 178 +64k; +4% +25% Oct Nov Dec 147.9 157.8 167.3 138.0 1,771 134.0 1,750 1,714 1,726 1,707 Monthly Churn ARPU (AR$) 4Q13 1Q14 2Q14
Slide 12: Capex - Focus on BB and UBB Fixed and Mobile
Capex - Focus on BB and UBB Fixed and Mobile Capex Evolution FTTx Rollout Mobile Access +3x 15% Fixed Others & Access 11% Spectrum 48% 19% 7% Core & Infraest. 1 8,957 4Q13 1Q14 2Q14 3Q14 4Q14 IT 3,530 Spectrum Carriers +33% Million of AR$ +12% +49% 4,851 5,427 +2% 3,192 3,257 FY11 FY12 FY13 FY14 % R
Slide 13: Agenda
Agenda Market Overview Business Highlights Financials Q&A 12
Slide 14: TEO Group: Consolidated Results
TEO Group: Consolidated Results OIBDA* Revenues IFRS, Million of AR$, Percentage IFRS, Million of AR$, Percentage 8,702 +15% % of Revenues 7,564 +10% +15% +25% 2,516 4Q Personal – Mobile 70% 2,010 Fixed Business 15% 33,341 +7% 2,067 3Q Broadband 10% +22% 1,930 Nucleo – Mobile 5% 27,287 5,993 6,570 +
Slide 15: TEO Group: Consolidated costs and OIBDA evolution
TEO Group: Consolidated costs and OIBDA evolution Operating Income Before Depreciation and Amortization FY13 – FY14 IFRS, Million of AR$ +1,138; +15% YoY Variation One-off Event; 756 AR$ 115 MM YE Bonus 1,032 1,788 245 1,439 608 427 692 8,702 4,250 228 229 7,564 55% 33% 35% 32% 26% 18% 23% 13% 15% 1
Slide 16: Results on OIBDA
Results on OIBDA 3Q14 4Q14 Revenues & Other 21% YoY OIBDA Income 22% growth 39% Handsets Costs 9% ITX Costs 36% 21% 30% Labor Costs 37% Taxes 18% 22% Other Marketing & 12% Sales 23% Fees for services, 33% maint. and materials 11% VAS Costs 35% 25% 2% Others 14% 1Q14 2Q14 3Q14 4Q14 YoY 17.4% 10.0% 7.
Slide 17: TEO Group: Consolidated Results
TEO Group: Consolidated Results Operating Net Income Income IFRS, Million of AR$, Percentage attributable to Telecom IFRS, Million of AR$, Percentage in million of AR$ FY13 FY14 Net Interests $ 632 $ 265 5,443 Gains on Mutual Funds & other inv. $ 124 $ 289 +20% FX results -$ 279 -$ 178 4,518 4Q Resu
Slide 18: TEO Group: FCF, Net Financial Position & Hedging Strategy
TEO Group: FCF, Net Financial Position & Hedging Strategy IFRS, Million of ARS - Last 12 months Free Cash Flow Operating free Cash Flow 8,702 5,427 1,665 1,610 2,277 OIBDA Capex Δ WK & others 349 5,354 3,530 1,299 538 Net Financial Position 745 Telecom Argentina 219(1) Net Financial Operating Spectr
Slide 19: Agenda
Agenda Market Overview Business Highlights Financials Q&A 18