Slide 1: FY 2008 Results Presentation
FY 2008 Results Presentation 27 May 2008 The Better Option. 1
Slide 2: Mr Nicholas Nganga, Chairman
Mr Nicholas Nganga Chairman The Better Option. 2
Slide 3: Mr Michael Joseph, CEO
Mr Michael Joseph CEO The Better Option. 3
Slide 4: 2008 Results Highlights
2008 Results Highlights Fiscal Year Ended March 31, 2008 • Impressive subscriber growth − 68% y-o-y growth from 6.1 million to 10.2 million subscribers − Market share increased from 73% to 84% in last fiscal year • Launch of several key initiatives to position Safaricom for future success − Ksh 20 s
Slide 5: Subscribers: Unparalleled Market Leadership
Subscribers Unparalleled Market Leadership • Safaricom even increased its impressive market share Mobile Subscribers and Penetration in Kenya (1) in FY2008 to 84% (000s) − Up from 80% end of Dec-07 (March 07 – 73%) 15,000 40.0 • Share of prepaid subscribers remained stable at 98.9% of total subs vs.
Slide 6: Market Share of Subscribers
Market Share of Subscribers Aggressively Gaining Market Share Net Additions Q4 FY08 (1) • Availed increased tariff range to suit subscriber (000s) lifestyle- SAASA, Super Tariffic, Super Taifa, Jambo, 1,200 1,000 Advantage plus 0,800 986 0,600 • Free and convenient SIM replacement 0,400 37 0,200 0,0
Slide 7: Growth Potential
Growth Potential Mobile Penetration Still Has Plenty of Room To Grow In the past year Mobile Penetration Across Africa (%) – March 2008 % • Total capex spend of Ksh 23bn in the year South Africa 98.4 • Base stations increased by 35% to 1,558 at end Mar 08. Libya 98.3 Tunisia 89.5 Vsats increased to
Slide 8: Capital Expenditure
Capital Expenditure Network Covers 78% of Population and 23% of Land Area Base Stations • Cumulative capex of Ksh 88.8bn since start of 1,750 operations 1,500 1,250 • Preferential “Kama Kawaida” roaming agreements in 1,000 1,558 750 1,150 East Africa with MTN Uganda, Uganda Telecom, 500 831 560 416
Slide 9: M-PESA
M-PESA Money-Transfer Product Going From Strength to Strength Cumulative Number of Registered Users (000s) • 2.075 million total registered users as of March 2008 2,500 2,000 1.175 additional people received money but did 1,500 not register 1,000 500 • Ksh 14.8bn transferred person to person in FY2
Slide 10: Mr Les Baillie, CFO
Mr Les Baillie CFO The Better Option. 10
Slide 11: Profit and Loss Account
P&L Profit and Loss Account For Year Ended March 31, 2008 2008 2007 Change Ksh Bn Ksh Bn % Revenue 61.4 47.4 29.3% Cost of Sales (26.1) (18.2) 43.6% Gross Profit 35.3 29.3 20.5% % Margin 57.5% 61.7% Expenses (7.2) (4.8) 49.5% EBITDA 28.2 24.5 14.9% % Margin 45.9% 51.7% Depreciation & Amortization (9
Slide 12: Revenue
Revenue Top-line Growth Driven by Net Additions • Total revenue grew by 29.3 % to Ksh 61.4bn in the Revenue (1) (Ksh MM) (% Growth) year due to the increase in subscriber base 65,000 40 61,369 744 • Voice grew by 31% while being a reflection of the 60,000 35.7 1,815 4,607 35 55,000 increased subscri
Slide 13: Opex & SG&A
Opex & SG&A Operating Expenses • Increased to Ksh 26.1bn, 42% of revenue in the year Operating Expenses (1) from Ksh 18.2bn, 38% of revenue during same period (Ksh MM) last year 30,000 2,960 25,000 • This reflects the combined increase in cost of 20,000 1,846 1,026 5,723 running the network 15,000
Slide 14: EBITDA
EBITDA • Record EBITDA of Ksh 28.2bn (US$420 MM) EBITDA (1) • Margin declined due to conscious decision to (Ksh MM) (% margin) invest for growth in FY2008 30,000 (% growth) 60 53.1 Planned effect of the aggressive customer 51.7 acquisition strategy 25,000 50 45.9 Customer retention initiative (i
Slide 15: ARPU & Churn
ARPU & Churn Average Revenue Per User (ARPU) Monthly ARPU (1) (Prepaid/Blended Ksh) (Postpaid Ksh) • Blended ARPU for prepaid and postpaid reduced to 3,000 10,000 Ksh 616 by Mar 08 from Ksh 799 at Mar 07 2,500 8,000 6,945 • Reduction due to rapid growth in subscriber base and 2,000 5,491 6,000 reduc
Slide 16: Appendix: Key Financials
Appendix Key Financials The Better Option. 16
Slide 17: Financial Statements: Income Statement
Financial Statements Income Statement Ksh (MM) FY Ends March 31 2006 2007 2008 Revenues 34,972 47,447 61,369 Cost of Sales (12,916) (18,155) (26,066) Gross Profit 22,056 29,292 35,303 % Margin 63.1% 61.7% 57.5% Other Income 11 17 5 Distribution Costs (953) (1,390) (2,324) Administrative Expenses (1,
Slide 18: Financial Statements (cont'd): Balance Sheet
Financial Statements (cont’d) Balance Sheet Ksh (MM) FY Ends March 31 2006 2007 2008 Current Assets 7,534 10,150 12,887 Cash & Cash Equivalents 2,917 5,888 5,535 Receivables and Prepayments 3,515 3,027 5,069 Inventories 1,101 1,235 2,284 Non-Current Assets 36,411 46,258 61,479 Prepaid Operating Leas
Slide 19: Financial Statements (cont'd): Cash Flow Statement
Financial Statements (cont’d) Cash Flow Statement Ksh (MM) FY Ends March 31 2006 2007 2008 Cash Generated from Operations 19,021 26,289 35,618 Interest Received 74 258 1,486 Interest Paid (409) (435) (589) Income Tax Paid (4,256) (5,002) (6,962) Cash From Operating Activities 14,431 21,110 29,553 In
Slide 20: Q&A
Q&A afarico Ss The Better Option. 20