Magyar Telekom Telecommunications Plc · BET:MTELEKOM
Magyar Telekom Telecommunications — Magyar Telekom — 9M 2008 Earnings Presentation
19 slides from Magyar Telekom Telecommunications's earnings presentation, 2008
Slide 1: Presentation: 2008 nine months results
Presentation 2008 nine months results Focus on efficiency and repositioning
Slide 2: Agenda
Agenda Overview Magyar Telekom’s strategic priorities Changes in organization, brand structure NGA strategy Headcount rationalization Challenges and strengths Dividend policy Public targets for 2008 and 2008 nine months results Nine months 2008 summary and segment analysis Regulatory snapshot Abbrev
Slide 3: Magyar Telekom Group at a glance
Overview Magyar Telekom Group at a glance Market leader in all core businesses Stock information Integrated operations in Hungary, Macedonia EUR 2.6bn market capitalization and Montenegro operating in 39 local areas out of the total 54 in Stock exchange listing Hungary listed on NYSE and Budapes
Slide 4: Magyar Telekom's strategic priorities
Magyar Telekom’s strategic priorities Focus on service excellence, efficiency and expansion Excellence Expansion stronger customer focus seeking value-creating acquisitions both in Hungary improved service quality and the region integrated sales and call-center services leading position in
Slide 5: Changes in organization, brand structure
Changes in organization, brand structure Leaner organization, simpler brand structure New organizational structure New brand structure Structural changes in the telecom industry Clear brand structure – strong corporate technological development and innovation brand convergence throughout the ind
Slide 6: New generation access (NGA) strategy
New generation access (NGA) strategy Reinforcing technological leadership Wireline network strategy CAPEX requirement 5-year plan aiming to cover 1.2 million Total CAPEX investment is HUF 40 billion households by 2013 (~30% of Hungarian between 2009 and 2013 households) offering bandwidth of up to 1
Slide 7: Headcount rationalization
Headcount rationalization Efficiency improvement Headcount-reduction commitment to reduce cost across the Group headcount reductions enabled through integrated Headcount reduction for 2008 operations and leaner corporate structure 15% decrease (~1,800 employees) by end of 2008 compared to the
Slide 8: Challenges and strengths
Challenges and strengths Changing business needs, continuing efficiency improvement Change in revenue mix Increasing profitability and return Revenue breakdown ongoing headcount reduction and cost cutting bear fruit HUF million visible signs of efficiency improvements in the 700 000 671 196 676
Slide 9: Dividend policy
Dividend policy Net debt ratio and dividend yield Net debt ratio** Dividend yield*** 50% 9.1% 9.2% 10% 46.6% 8.7% 8.7% 8.7% 40% 38.8% 8% 32.9% 33.2% 31.7% 31.0% Targeted net 31.6% debt ratio range 30% 6% 20% 4% 10% 2.3% 2% 1.4% 0% 0% 2001 2002 2003 2004 2005 Q1 2007* 2007 2008 2009 * 2006 dividend p
Slide 10: Public targets for 2008 and first nine months results
Public targets for 2008 and first nine months results 2008 public targets 2008 first nine months results Revenue Flat over 2007 -0.2% competitive landscape Hungarian broadband growth has slowed down sluggish economic growth limits disposable further increase in fixed line churn income regu
Slide 11: First nine months 2008 summary
First nine months 2008 summary Revenues EBITDA EBITDA margin Group HUF 502.8bn -0.2% HUF 213.8bn +5.4% 42.5% Underlying** HUF 221.1bn +2.8% 44.0% T-Com HUF 218.7bn -5.2% HUF 93.4bn +0.1% 42.7% underlying HUF 96.3bn -1.8% 44.0% T-Mobile HUF 258.7bn +0.4% HUF 116.0bn +1.1% 44.8% Segments* underlying H
Slide 12: T-Com: Hungarian operations
T-Com: Hungarian operations Focus on efficiency and customer retention Voice revenues under threat from Revenue breakdown HUF million competition 200 000 -4.5% increasing threat from cable operators offering 3Play 150 000 strong mobile substitution as mobility premium diminishes 100 000 annual
Slide 13: T-Com: Hungarian operations
T-Com: Hungarian operations Broadband market developments Cable services General deceleration of BB market growth Second player on the cable market MTel’s ADSL retail market share 52%, cable BB 15% T-Kábel market share ~19% based on cableTV most competition comes from cable operators, while cu
Slide 14: T-Mobile: Hungarian operations
T-Mobile: Hungarian operations Competitive environment Increasing focus on customer acquisition continued growth in RPC base (up 11%) HUF/min Mobile termination rates 40 due to distribution of free SIM cards acquisition cost/new RPC fell by 4% to HUF 6,550 in Q1-3 35 Tariff erosion 30 broad us
Slide 15: T-Mobile: Hungarian operations
T-Mobile: Hungarian operations Solid financial and operational performance Continued tariff decline Usage and ARPU trends MOU increased by 3% yoy to 152 in Q1-3 ARPU (HUF) MOU ARPU down by 10% to HUF 4,124 (~EUR 17) 6 000 160 growing importance of VAS (17% of ARPU) 5 500 150 5 000 140 postpa
Slide 16: T-Com: international operations
T-Com: international operations Macedonia Montenegro Limited top line growth opportunities Booming broadband market fixed line penetration was 21.6% (down 1.2ppt) fixed line penetration at 28.2% (down 2.3ppt) number of lines ~473,000 (down 5.2%) number of lines ~185,000 (down by 2.4%) stro
Slide 17: T-Mobile: international operations
T-Mobile: international operations Macedonia Montenegro Subscribers (th) Subscribers (th) 212% 164% 169% 180% 198% Penetration 73% 81% 93% 100% 106% Penetration 1 200 2 500 000 27% 1 000 23% 25% 16% 25% 2 000 000 12% 8% 9% 10% 800 41% 1 500 000 4% 30% 29% 600 48% 42% 43% 30% 30% 41% 33% 400 1 000 00
Slide 18: T-Systems
T-Systems Growing importance of SI/IT services Declining traditional revenues Leading position in the Hungarian SI/IT Pressure on voice and data revenues market intense competition from alternative service full scale IT service portfolio offered through providers and strong mobile substitution a
Slide 19: Regulatory snapshot
Regulatory snapshot Regulation follows the EU regulatory recommendations in all three countries Hungary: fully in line with the EU Regulatory Framework Macedonia: liberalization of the fixed line market is in progress, regulated mobile termination rates Montenegro: new telecommunication law wa