Tele2 Ab Class A · OMXSTO:TEL2_A

Tele2 Ab Class A — Q2 2017 Earnings Presentation

28 slides from Tele2 Ab Class A's earnings presentation, Jul 19, 2017

  1. Slide 1: Tele2 AB Q2 2017

    July 19th, 2017 Tele2 AB

  2. Slide 2: Q2 2017 summary

    % Change % Change SEK billion Q2 2017 Reported LFL Mobile end-user service revenue Net sales EBITDA 2 LFL is constant currencies and pro forma for TDC Sweden

  3. Slide 3: Tele2's Way2Win

    Tele2’s Way2Win Our Purpose We fearlessly liberate people to live a more connected life Where We Play How We Win CRORSROR BG RORORS Baltic Sea Investment Cash Positively Connecting Digital First Challenger Challenger Markets Generators Fearless Things our Customer Cost Brands Customers Experience St

  4. Slide 4: Q2 2017 key figures

    • • • 4 • • • • • • • • • LFL is constant currencies and pro forma for TDC Sweden 4 Operating cash flow is EBITDA - CAPEX, 12 m rolling

  5. Slide 5: Baltic Sea Challenger

    Baltic Sea Challenger TELE2

  6. Slide 6: Net sales, service revenue and EBITDA, LFL

    Net sales, LFL Mobile end-user service EBITDA and EBITDA margin, (SEK million) revenue, LFL (SEK million) LFL (SEK million) +1% +3% +12% 50% 1,191 45% 4,332 1,959 1,045 1,091 1,040 1,865 1,969 1,922 1,930 3,877 3,900 3,932 3,921 927 40% 1,068 1,028 TDC 1,885 1,928 4,029 1,778 35% 846 3,018 3,095 31%

  7. Slide 7: Consumer mobile end-user service revenue

    Consumer mobile end-user Share of sales with bundle Customer satisfaction service revenue >3GB (Tele2 Media & Insight) +8% 66% 60% 87% 83% 85% 84% Q2 16 Q2 17 Q2 16 Q2 17 Q2 16 Q2 17 Tele2 Comviq Q2 Highlights – New Tele2 campaign and product portfolio launched in April with early positive consumer

  8. Slide 8: B2B net sales and integration synergies

    B2B net sales, LFL B2B Large net sales, LFL YTD integration synergies (SEK million) (SEK million) -1% -2% Q2 16 Q2 17 Q2 16 Q2 17 Q2 Highlights – Net sales down slightly due to increased price competition in Large Enterprise, partly offset by growth in SME – TDC integration and synergies ahead of pl

  9. Slide 9: Net sales, service revenue and EBITDA

    Net sales Mobile end-user service EBITDA and EBITDA margin (SEK million) revenue (SEK million) (SEK million) +21% +18% +23% 935 949 564 314 1,000 884 859 600 521 533 522 350 60% 900 787 477 287 286 800 500 300 256 264 50% 700 250 400 40% 600 500 300 200 33% 32% 33% 33% 30% 400 150 28% 200 20% 300 10

  10. Slide 10: ASPU development and 4G smartphone share

    ASPU development Share of 4G capable MBB end-user service revenue smartphones in base +13% +51% 41% 28% Q2 16 Q2 17 Q2 16 Q2 17 Q2 16 Q2 17 Q2 Highlights – Strong ASPU growth driven by continued prepaid to postpaid migration and larger buckets – Strong increase in smartphone penetration, with room f

  11. Slide 11: Investment Markets

    Investment Markets TELE2

  12. Slide 12: Netherlands net sales, service revenue, EBITDA

    Net sales Mobile end-user service EBITDA (SEK million) revenue (SEK million) (SEK million) +3% +51% +134m 1,800 1,583 1,577 1,489 600 509 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 1,452 1,478 1,600 500 419 438 451 1,400 200 1,200 400 336 151 1,000 150 300 800 100 600 200 400 200 100 50 18 0 0 0 Q2 16 Q3 16 Q4 1

  13. Slide 13: Brand awareness and new postpaid intake

    Spontaneous brand awareness Share of total new postpaid Usage on own network & brand consideration (Memo2) (GfK) 52% 91% 49% 27% 28% 67% 41% 40% 15% 50% 10% 0% Q2 16 Q2 17 May 16 May 17 June 16 June 17 Awareness Consideration Handset SIM only Voice Data Q2 Highlights – New campaign and new propositi

  14. Slide 14: Kazakhstan net sales, service revenue, EBITDA

    Net sales Mobile end-user service EBITDA and EBITDA margin (SEK million) revenue (SEK million) (SEK million) +35% +39% +264% 220 50% 45% 800 702 713 600 547 649 495 170 160 40% 700 470 573 500 426 122 600 527 394 35% 400 120 30% 500 92 400 300 79 25% 22% 300 200 70 44 19% 20% 200 15% 100 14% 13% 100

  15. Slide 15: Customer base, ASPU and integration

    Customer base ASPU development Integration (thousands) +5% +16% 6,402 6,753 Q2 16 Q2 17 Q2 16 Q2 17 Q2 Highlights – Dual brand strategy driving customer growth – Altel brand re-launched in April to strengthen its premium position in the market – Larger data buckets are driving data monetization – Ne

  16. Slide 16: Simplify, Consolidate, Discipline

    Baseline 2016 actual 2018 target Key progress areas since inception Simplify  New revenue streams % of products harmonized on shared platforms  Sales & marketing efficiency Discipline % of spend strategically sourced & procured  Network & IT consolidation Consolidate  Customer service optimizati

  17. Slide 17: Financial Overview

    Financial Overview TELE2

  18. Slide 18: Tele2 Group development per market: net sales

    Tele2 Group Development per market (SEK million) (SEK million) +18% 153 13 23 3,908 3,908 173 3,711 3,725 3,598 87 3,307 152 3,307 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q2 16 Sweden Baltics NL KZ RoW Oth Q2 17 18

  19. Slide 19: Tele2 Group development per market: EBITDA

    Tele2 Group Development per market (SEK million) (SEK million) +50% 1,900 1900 60.0% 1,723 1,700 18 1,631 1700 1,631 116 24 1,562 1,459 50.0% 1,500 134 1500 58 1300 40.0% 1,300 194 1100 1,087 30.0% 1,087 1,100 900 22.4% 21.9% 700 20.4% 20.0% 900 16.3% 17.8% 500 10.0% 700 300 100 0.0% 500 Q2 16 Q3 16

  20. Slide 20: Tele2 Group development per market: CAPEX

    Tele2 Group Development per market (SEK million) (SEK million) 1400 60.0% -6% 1200 1,078 50.0% 60 0 1000 40.0% 820 62 820 779 800 770 -13 770 627 30.0% -125 -34 600 20.0% 400 12.3% 13.1% 11.2% 9.6% 10.0% 200 8.0% 0 0.0% Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q2 16 SE Baltics NL KZ RoW Other Q2 17 CAPEX / Net

  21. Slide 21: Tele2 Group free cash flow development

    Total operations Tele2 Group Development (SEK million) (SEK million) +490% 838 820 196 0 20 820 544 3 -82 394 178 139 139 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q2 16 EBITDA Interest Taxes Working CAPEX One-off Q2 17 etc. Capital item 21 Free cash flow = Cash flow from operating activities and CAPEX pa

  22. Slide 22: EBITDA less CAPEX, 12 m rolling

    EBITDA less CAPEX 12 m rolling, SEK million 3,871 4,136 3,491 3,456 3,423 3,470 3,335 3,402 3,432 3,437 -1,178 -1,344 -1,015 -1,504 -1,625 -1,940 -2,223 -2,282 -2,196 -1,934 Q1 15 Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Baltic Sea Challenger & Rest of Group Investment Markets 22

  23. Slide 23: Economic net debt to EBITDA

    Economic net debt to EBITDA 12 m rolling SEK billion Leverage 2.5 12.5 2.0 1.91 10.0 1,88 1.5 7.5 11.7 12.0 11.0 10.4 1.0 5.0 10.3 2.5 0.5 0.0 0.0 Jun 2016 Sep 2016 Dec 2016 Mar 2017 Jun 2017 Economic net debt Economic net debt to EBITDA 23 Economic net debt excludes debt and earn out liabilities re

  24. Slide 24: Outlook: service revenue, net sales, EBITDA, CAPEX

    Mobile end-user service revenue Net sales (SEK billion) EBITDA (SEK billion) CAPEX (SEK billion) 24 * Based on LFL which is constant currencies and pro forma for Altel and TDC Sweden

  25. Slide 25: Summary

    Summary TELE2

  26. Slide 26: Key priorities moving forward

    Key priorities moving forward 26 Become the customer champion of connectivity Growth from continued data monetization, despite RLAH Sustain our Baltic Sea Challenger status and strength Further leverage our challenger strategy in Netherlands and Kazakhstan Execute on Challenger and synergy programs

  27. Slide 27: Tele2's Way2Win

    Tele2’s Way2Win Our Purpose We fearlessly liberate people to live a more connected life Where We Play How We Win CRORSROR BG RORORS Baltic Sea Investment Cash Positively Connecting Digital First Challenger Challenger Markets Generators Fearless Things our Customer Cost Brands Customers Experience St

  28. Slide 28: The End

    THE END

Tele2 — Q2 2017 Earnings Presentation on 6ix