Chunghwa Telecom Co., Ltd · TWSE:2412
Chunghwa Telecom — Q3 2014 Earnings Presentation
17 slides from Chunghwa Telecom's earnings presentation, Oct 29, 2014
Slide 1: Q3 2014 Operating Results
Q3 2014 Operating Results October 29, 2014 TSE: 2412 NYSE: CHT
Slide 2: Disclaimer
Disclaimer STATEMENT REGARDING UNAUDITED FINANCIAL INFORMATION The unaudited financial information under T-IFRSs in this presentation is preliminary and subject to adjustments and modifications. Adjustments and modifications to the financial statements may be identified during the course of the audi
Slide 3: Business Overview
Business Overview
Slide 4: Chunghwa Telecom Overview
Chunghwa Telecom Overview Strong Market Position (a) Revenue Breakdown (f) Domestic Fixed – #1 Local • 94.4% share by subs (11.43 mn subs) 100% 0.9% 1.6% 1.1% 1.1% 7.0% 6.8% 7.0% 6.9% • 85.1% share by minutes 90% – #1 DLD 11.9% 12.2% 11.2% 11.6% 80% • 79.9% share by minutes – #1 Broadband access 70%
Slide 5: Number One Mobile Services Provider
Number One Mobile Services Provider Performance VAS Performance Strategy Focusing on 4G service promotion NT$ mn 45.6% 42.6% 43.9% 37.3% 39.7% Expanding 4G smart device profile Mobile VAS Revenue % 8,000 1,012 40% 1,040 998 VAS revenue 1,106 1,077 Continuing the migration of 2G 6,000 30% customers t
Slide 6: Smartphone – Value Driver for Mobile
Smartphone – Value Driver for Mobile Smartphone Adoption Smartphones accounted for 89% of the total Smartphone penetration* handsets CHT offered in Q3 2014 58% 59% 62% 100% 53% 56% 21.0% 60% 50% 26.0% 80% 50% 47.0% 49.0% 40% 60% 41.0% 30% 20% 49.0% 40% 29.0% 18.0% 10% 0% 20% 38.0% Sep 13 Dec 13 Mar
Slide 7: Fixed Broadband and Internet Services
Fixed Broadband and Internet Services Performance Strategy Launching 300M/100M fiber service to maintain Broadband Access Revenue NT$ mn 703 708 707 698 701 ARPU NT$ leadership Continuing to migrate customers from low speed to 5,000 3,819 3,923 3,956 3,886 3,978 600 high speed fiber services 400 Exp
Slide 8: MOD/ IPTV Service
MOD/ IPTV Service Performance Subscriber & Usage Subscriber market share (CATV+IPTV) QoQ grew IPTV revenue increased by 23.2% from 20.1% to 20.5% in Q2 2014 YoY for Q3 2014 90.1% of IPTV subscribers signed up additional Household TV Usage rate increased Packages to 61.9% from 57.6% YoY for Q3 2014 S
Slide 9: ICT and Cloud Computing Initiatives
ICT and Cloud Computing Initiatives Performance Strategy Cloud and information security service revenue Leveraging core telecom infrastructure and increased by 27.7% YoY in Q3 2014 services to expand ICT business Personal Cloud (Hami+) subscribers accumulated to Leading the cloud computing industry
Slide 10: Financials Overview
Financials Overview
Slide 11: Financials: Income Statement Highlights
Financials: Income Statement Highlights Consolidated Jan-Sep Jan-Sep Q3 2013 Q3 2014 Growth Growth (NT$bn) (T-IFRSs) (T-IFRSs) % 2013 2014 % (T-IFRSs) (T-IFRSs) Revenues 56.72 56.14 (1.0) 169.18 166.97 (1.3) Operating Costs and 44.12 44.96 1.9 132.67 131.55 (0.8) Expenses Income from 12.59 11.16 (11
Slide 12: Financials: Business Segment Revenues
Financials: Business Segment Revenues (NT$bn) Q3 2013 Q3 2014 Growth Jan-Sep 2013 Jan-Sep 2014 Growth (T-IFRSs)(T-IFRSs) % (T-IFRSs) (T-IFRSs) % Domestic Fixed 17.97 18.08 0.6% 54.21 52.46 (3.2%) Local 9.58 8.98 (6.3%) 28.59 26.88 (6.0%) DLD 0.87 0.84 (3.1%) 2.61 2.50 (4.3%) Broadband Access 4.77 4.
Slide 13: Financials: Costs & Expenses
Financials: Costs & Expenses Consolidated Jan-Sep Jan-Sep Q3 2013 Q3 2014 Growth Growth (NT$bn) (T-IFRSs) (T-IFRSs) % 2013 2014 % (T-IFRSs) (T-IFRSs) Operating Costs 35.79 36.28 1.4 108.52 106.32 (2.0) Operating Expenses 8.33 8.68 4.2 24.15 25.23 4.5 Marketing 6.37 6.81 6.8 18.32 19.40 5.9 General a
Slide 14: Cash Flow & EBITDA Margin
Cash Flow & EBITDA Margin Consolidated Jan-Sep Jan-Sep Q3 2013 Q3 2014 Growth Growth (NT$bn) (T-IFRSs) (T-IFRSs) % 2013 2014 % (T-IFRSs) (T-IFRSs) Net Cash Flow from 17.10 18.15 6.1 45.00 42.19 (6.3) Operating Activities CapEx 7.72 7.89 2.2 23.31 20.98 (10.0) Free Cash Flow 9.38 10.26 9.4 21.69 21.2
Slide 15: Forecast & Operating Results
Forecast & Operating Results Consolidated Q3 2014 Jan-Sep Q3 2014 Achieving 2014 Achieving (NT$bn) (T-IFRSs) (T-IFRSs E) % 2014 (T-IFRSs E) % (T-IFRSs) Revenues 56.14 57.23 98.1 166.97 228.23 73.2 Operating Costs and 44.96 45.23 99.4 131.55 184.70 71.2 Expenses Income from 11.16 12.00 93.1 35.39 43.
Slide 16: Effective and Efficient Capital Expenditure
Effective and Efficient Capital Expenditure Capital Expenditure NT$ bn Budgeted capex for 2014: NT$40.1bn 36.4 40.1 – Expect to see more than 10% 33.3 reduction 50 26.9 23.3 21.0 17.6% 20% 45 15.0% 16.0% 12.4% 13.8% 12.6% 40 0.7 1.9 10% Continue to focus on core 0.6 businesses for future investments
Slide 17: Q&A
Q&A