Singapore Telecommunications Limited · SGX:Z74
Singapore Telecommunications — Investor Day (July 2010)
37 slides from Singapore Telecommunications's investor day presentation, Jul 5, 2010
Slide 1: Optus Investor Day: Optus Overview and Strategy
Optus Investor Day: Optus Overview and Strategy Paul O’Sullivan Chief Executive, Optus 5 July 2010
Slide 2: Forward looking statements - important note
2 Forward looking statements - important note The following presentation may contain forward looking statements by the management of SingTel Group relating to financial trends for future periods, compared to the results for previous periods. Some of the statements contained in this presentation that
Slide 3: Video: Lemonade TVC
Video: “Lemonade” TVC 3
Slide 4: Today
4 Today 1 Optus overview 2 FY10 performance 3 Future opportunities and strategy
Slide 5: Today
5 Today 1 Optus overview 2 FY10 performance 3 Future opportunities and strategy
Slide 6: Optus: integral part of an extensive group
6 Optus: integral part of an extensive group SingTel: major mobile operator in Asia 293m subs 1 Optus’ contribution to proportionate EBITDA2 30% Others 1% 16.3m PBTL 30% 1.9m Optus 45% 29.5m 30% 21% 23.9m 47% Regional 127.6m 42% 32% Mobile *Acquisition of Zain’s assets in 15 African countries comple
Slide 7: Optus today
7 Optus today • 10,394 Direct employees • 8.5m mobile customers • Around 70 Nationalities • 1m telephony customers • Employee Engagement score • 980k fixed broadband customers 2% above Global Telco norm • Key Business customers include ANZ, News Ltd, Defence and ATO • Key Wholesale Partners include
Slide 8: Optus Revenue – A$bn
8 8.9 8.3 7.8 7.5 7.2 6.9 6.6 5.6 4.6 4.8 4.1 3.2 2.9 2.5 1.9 1.4 0.3 0.1 0.8 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 OPTUS REVENUE – A$BN Note: All numbers are FY end
Slide 9: Revenues of A$9bn places Optus in the top 20 of ASX listed companies
9 Revenues of A$9bn places Optus in the top 20 of ASX listed companies Listed Company $Bn Listed Company $Bn 1. Westfarmers 50.6 14. Qantas Airways 13.0 2. BHP Billiton 50.2 15. AMP 10.7 3. Woolworths Ltd 49.6 16. Bluescope Steel 10.3 4. Rio Tinto 41.8 17. Macquarie Group 10.0 5. Commonwealth Bank o
Slide 10: Optus network infrastructure
10 OVER 8,000 OVER 10,000KM Mobile Base Stations, of intercity fibre (from including 4,300 3G Perth to Cairns) HSPA Base Stations OVER 26,000KM OVER 11,000KM Darwin of HFC cable of intra-city fibre Cairns 5 OPTUS OVER 1,000 Mt Isa satellites in orbit DSLAM racks in 371 Telstra exchanges Brisbane Own
Slide 11: Optus continues to invest strongly, and cash flows are increasing
11 Optus continues to invest strongly, and cash flows are increasing CAPEX (A$ MILLION) FREE CASH FLOW (A$ MILLION) 1,181 1,234 1,130 1,095 1,041 1,049 1,015 967 903 811 815 742 2005 2006 2007 2008 2009 2010 2005 2006 2007 2008 2009 2010 Note: All numbers are FY end
Slide 12: We have a strong financial position
12 We have a strong financial position AAA • Net Debt A$1.5bn1 AA • FCF >A$1bn2 A+ • Access to international debt capital markets A - US$500m 10 yr notes - HK$ 1bn 10 yr notes A- • Committed medium term bank facilities - Total facilities A$975m1 BBB+ - Maturing 2012 BBB BBB- 1: As at 31 Mar 2010 2:
Slide 13: Optus: three major businesses
13 Optus: three major businesses OB/OWS (fixed) A$ 2.0bn1 • 97% population 3G voice coverage • Full service provider to business and • Serving 1.4m homes with over • 8.5m Optus subscribers government, and wholesale services 26,000km HFC network to smaller carriers • Serving 2.9m premises with ULL –
Slide 14: Overall Optus holds strong #2 market position
14 Overall Optus holds strong #2 market position REVENUE SHARE TO DEC 2009 Others Mobile Fixed Australian Market Revenue Source: JPMorgan, company disclosures
Slide 15: Optus' brand positioning: Customer Champion
15 Optus’ brand positioning: Customer Champion CUSTOMER CHAMPION Leading More innovative Customer ways to use Experience technology
Slide 16: Delivering Customer Experience improvements from company-wide transformation program
16 Optus: delivering Customer Experience improvements from company-wide transformation program CUSTOMER EXPERIENCE RECENT SUCCESS TRANSFORMATION CONSUMER NET TIO COMPLAINTS BUSINESS CUSTOMER • IT Transformation – Reitz Program PROMOTER SCORE PER 10K SATISFACTION SCORE – Rationalisation of IT Systems
Slide 17: Optus' innovation: delivering value and choice to the market
17 Optus’ innovation: delivering value and choice to the market MOBILE FIXED
Slide 18: Video: Soccer TVC
Video: Soccer TVC 18
Slide 19: Today
19 Today 1 Optus overview 2 FY10 performance 3 Future opportunities and strategy
Slide 20: The recent Optus journey
20 The recent Optus journey ACCELERATION FY08--FY09 FY08 • Increase mobile growth momentum to drive revenue share BEGIN TRANSFORMATION gains • Business stabilisation • Deliver initial customer • Re-start mobile growth experience differentiation and • Targeted investments: Reitz, 96% realise benefits
Slide 21: Mobile revenue market share up 1.2% in 12 months to Dec 09
21 Mobile revenue market share up 1.2% in 12 months to Dec 09 MOBILE SERVICE REVENUE SHARE - % 44.0% 43.4% 42.7% 42.6% 30.9% 30.3% 29.7% 29.1% 27.5% 27.0% 26.4% 26.6% Jun-08 Dec-08 Jun-09 Dec-09 Source: JPMorgan
Slide 22: Delivering benefits from customer experience transformation
22 Delivering benefits from customer experience transformation • Improved first call resolution results in Call Centres Customer • Customer contact via online or agent • Reduced call waiting times Service & • 16% reduction in calls to Fixed general enquiry Problem • 90% reduction in ULL reschedules
Slide 23: Continued advocacy to deliver wholesale-only open access NBN
23 Continued advocacy to deliver wholesale-only open access NBN Regulated prices & terms Heightened ACCC oversight role Retail separation Equivalent access for all access seekers
Slide 24: Overall Optus delivered to market guidance in FY10
24 Overall Optus delivered to market guidance in FY10 FY10 GUIDANCE FY10 OUTCOMES Revenue to grow at single digit level Revenue A$8,949m Up 8% EBITDA to grow at low single-digit level EBITDA A$2,153m Up 4% Capital expenditure to be approx. A$1.1 billion A$1,049m Capex: revenue 12% Free cash flow to
Slide 25: Video: Optus Achievements
Video: Optus Achievements 25
Slide 26: Today
26 Today 1 Optus overview 2 FY10 performance 3 Future opportunities and strategy
Slide 27: Optus: Leading performance in strong growth sector in robust Australian economy
27 Optus: Leading performance in strong growth sector in robust Australian economy ROBUST AUSTRALIAN RESILIENT TELCO MARKET MOBILE MARKET GROWTH ECONOMY DRIVEN BY MOBILE LEADING DEVELOPED MARKETS • #2 GDP growth among developed • Low single digit telco market • Australia #1 mobile service economies,
Slide 28: Optus: Leading performance in strong growth sector in robust Australian economy
28 Optus: Leading performance in strong growth sector in robust Australian economy CY09 MOBILE SERVICE REVENUE GROWTH CY09 MOBILE SERVICE REVENUE GROWTH Australia France USA Germany W. Europe UK Italy Spain Total Source: JP Morgan
Slide 29: Looking ahead: challenges and opportunities in our future market
29 Looking ahead we see TECHNOLOGY a range of challenges CUSTOMER and opportunities in our future market REGULATORY Competition Customer COMPETITION Regulatory
Slide 30: Technology continues to evolve rapidly
30 1: Technology continues to evolve rapidly MOBILE NETWORK BANDWIDTH FIXED NETWORK BANDWIDTH MOBILE NETWORK 1000000 1 Gbit/s DEVELOPMENT 100000 100 Mbit/s 100 / 40MbpsActual Customer Experience# 10000 Downstream Bit Rate 50 / 20Mbps 10 Mbit/s 42 / 11Mbps 1500 > 15 Mbps 1000 21 / 5Mbps 512 10-12 Mbp
Slide 31: Customer behaviour changing in response
31 2: Customer behaviour changing in response CUSTOMERS ARE INCREASINGLY CHOOSING SMARTPHONES CUSTOMERS ARE ACCESSING INCREASING AMOUNTS OF FIXED DATA Handset Shipments (millions) 58% Early 2009 Smartphones 51% Traditional phones % smartphones 45% 41% Peak Off peak 36% 32% 11.7 11.9 12.0 11.2 10.6 9
Slide 32: Evolving regulatory landscape
32 3: Evolving regulatory landscape Government confirmed process of Significant reform contemplated in renewal of existing spectrum licences telecommunications reform legislation Expected upcoming wireless spectrum – Telstra separation auctions (700 MHz, 2.5 GHz) – Enhanced ACCC powers Stable mobile
Slide 33: Continued strong competition
33 4: Continued strong competition • Re-pricing of fixed and mobile broadband, • Focus on $29 price point although still premium pricing & Mobile Broadband • New focus on mobile caps to bolster • Rebranding and integration underway acquisition
Slide 34: Combined these trends will drive a major shift in market value
34 Combined these trends will drive a major shift in market value Today Future Australian telco market Revenue to Dec 2009 MOBILE CONTINUES TO BE A KEY SOURCE OF Other VALUE: Growth segment Strong demand expected for mobile broadband services HOWEVER, FIXED MARKET STILL VERY IMPORTANT: Increas
Slide 35: Opportunity for Optus to capitalise on these trends
35 Opportunity for Optus to capitalise on these trends MARKET LEADING CUSTOMER EXPERIENCE WIRELESS LED CONVERGED ACCESS – ANY DEVICE IN ANY LOCATION DEEPLY PERSONALISED, RELEVANT CONVERGED SERVICES LOW COST CONVERGED NETWORK HIGH PERFORMING ORGANISATION Specifically supporting relevance, converged a
Slide 36: Our future: focus on maintaining mobile momentum, exploiting the NBN
36 Our future: focus on maintaining mobile momentum, exploiting the NBN FY10--FY12 FY10 Exploit NBN & IP Drive to leadership to cement leadership in Customer via wireless-led Experience & convergence relevance
Slide 37: Optus Investor Day: Optus Overview and Strategy
Optus Investor Day: Optus Overview and Strategy Paul O’Sullivan Chief Executive, Optus 5 July 2010
Singapore Telecommunications — Investor Day (July 2010) on 6ix