Freenet Ag · XETR:FNTN
Freenet — FY2021 Earnings Presentation
22 slides from Freenet's earnings presentation, Feb 25, 2022
Slide 1: Management Presentation Preliminary Results FY 2021
MANAGEMENT PRESENTATION Preliminary Results FY 2021 CHRISTOPH VILANEK, CEO INGO ARNOLD, CFO 25 February 2022 Analyst and Investor Conference Call
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT This presentation contains forward-looking statements which involve risks and uncertainties. The actual performance, results and timing of the business of freenet AG could differ materially from the expectations regarding performance, results and timing expressed in this present
Slide 3: Agenda
AGENDA 1 BUS INES S C. V ILA NE K , CEO 2 FINA NCIA LS I. A R NO LD, CFO 3 Q &A
Slide 4: freenet Excels Its 2021 Guidance
FREENET EXCELS ITS 2021 GUIDANCE FINANCIAL PERFORMANCE 2020 GUIDANCE PRELIMS YOY in mEUR/ as indicated 2021 2021 CHANGE ▪ Revenue 2,576.2 stable 2,556.3 -0.8% ▪ EBITDA 425.9 430 - 445 447.3 +5.0% ▪ Free cash flow 1 201.3 215 - 230 234.4 +16.4% SUBSCRIBER BASE in ‘000s ▪ Postpaid contracts 7,078.7 Mo
Slide 5: +130.6 Thousand Mobile Subscribers
+130.6 THOUSAND MOBILE SUBSCRIBERS GOOD PERFORMANCE IN A COVID MOBILE SUBSCRIBER DEVELOPMENT IMPACTED YEAR in ‘000s +130.6 ▪ Lenghty period of lockdown and closed shops ▪ 5G tariff offerings with Vodafone and T-Mobile 7,223.0 7,266.0 88.0 ▪ Introduction of ‘Smart Pricing’ for all contract renewals 7
Slide 6: waipu.tv Delivers 12 Months Positive Contribution and Dynamic Growth
WAIPU.TV DELIVERS 12 MONTHS POSITIVE CONTRIBUTION AND DYNAMIC GROWTH OPERATIONAL HIGHLIGHTS WAIPU.TV SUBSCRIBERS in ‘000s ▪ Launch of waipu.tv 4k stick make waipu.tv to be the +26.2% cord cutting alternative 668.5 722.5 611.7 644.6 ▪ TV campaign with Dieter Bohlen as testimonial in Q4 572.5 drives a
Slide 7: Media Broadcast Business with Stronger EBITDA from TV and Radio
MEDIA BROADCAST BUSINESS WITH STRONGER EBITDA FROM TV AND RADIO FREENET TV (RGU) OPERATIONAL HIGHLIGHTS in ‘000s freenet TV -11.7% 902 868 845 813 797 ▪ Focus on EBITDA generation through efficiency gains and slowdown of churn; overall DVB-T2 users in Germany at constant level ▪ Price increase plann
Slide 8: The New Testimonial Campaign Pays Back…
THE NEW TESTIMONIAL CAMPAIGN PAYS BACK… ▪ 42 percent of sales reps report active mentioning of Dieter Bohlen from customers in the shops ▪ Advertising recognition for freenet increases by 55% and 33% for waipu.tv from pre Dieter Bohlen +55% 45% +33% 29% 12% 9% Oct 21 Feb 22 Oct 21 Feb 22 Basis: Adve
Slide 9: …And Has Encouraged to Migrate from mobilcom-debitel to freenet
…AND HAS ENCOURAGED TO MIGRATE FROM MOBILCOM-DEBITEL TO FREENET REASON WHY ▪ mobilcom-debitel was a compromise in 2008 in order to no loose customers ▪ The double brand was always a handicap in communication ▪ Same brand for retail chain and product made messaging complex ▪ New products such as free
Slide 10: Significant Progress in Integrating ESG into Decision-Making
SIGNIFICANT PROGRESS IN INTEGRATING ESG INTO DECISION-MAKING ESG KEY FOCUS AREAS HIGHLIGHTS 2021 Environment Governance Awarded LEADING EMPLOYER Germany 2021 ▪ Energy efficiency ▪ Good governance Avg. digital learning hours/employee increased by >50% ▪ Reduction carbon ▪ Compliance and footprint int
Slide 11: Our Sustainability Agenda for 2022
OUR SUSTAINABILITY AGENDA FOR 2022 ESG FOCUS AREAS 2022 MAJOR PROJECT 2022: COMPLETION ESG- ELIGIBLE RENOVATION OF FREENET HQ Harmonisation of Group-wide measurement model for customer satisfaction Expansion of digital-first approach (customer communication, products, smart pricing) Conversion of To
Slide 12: Current Trading in Q1 22 and Outlook
CURRENT TRADING IN Q1 22 AND OUTLOOK MOBILE COMMUNICATIONS TV & MEDIA ▪ Noticeable regulatory headwinds from Telco ▪ waipu.tv with strong start in Q1, expected to Act, but final effect not yet clear grow in subs and ad revenues with increasing ▪ Customer base in January under pressure dynamic over t
Slide 13: Group – Significant EBITDA Growth in 2021
GROUP – SIGNIFICANT EBITDA GROWTH IN 2021 GROUP in mEUR REVENUES FY21 VS. FY20 +0.7% ▪ Group revenues stable at 2,556.3 mEUR (2020: 2,576.2 mEUR) 670.7 675.5 ▪ Group gross profit w/o freenet digital up to 853.4 mEUR (2020: 648.8 622.1 634.5 619.2 619.9 641.8 849.5 mEUR) resulting from stable mobile
Slide 14: Mobile – Another Quarter with Increasing Service Revenues
MOBILE – ANOTHER QUARTER WITH INCREASING SERVICE REVENUES REVENUES FY21 VS. FY20 in mEUR -0.5% ▪ Mobile Communications revenues slightly down (-1.5% yoy) at 582.6 602.4 599.7 2,270.8 mEUR (2020: 2,306.1 mEUR); good shape of the mobile 554.2 567.0 548.7 551.1 571.2 30.9 37.5 29.0 29.7 business again
Slide 15: Mobile – DLS Revenues Above 200 Million Euros
MOBILE – DLS REVENUES ABOVE 200 MILLION EUROS HIGH-VALUE MOBILE CUSTOMER BASE FY21 VS. FY20 in ‘000s +1.8% ▪ Growing mobile customer base with comparably high profitability and loyalty (+1.8% yoy to 7,266.0 k) 7,266.0 7,191.2 7,223.0 ▪ Postpaid ARPU stable at 18.1 EUR (2020: 18,2 EUR); pandemic- 7,1
Slide 16: TV and Media – Considerable Contribution from waipu.tv
TV AND MEDIA – CONSIDERABLE CONTRIBUTION FROM WAIPU.TV REVENUES FY21 VS. FY20 in mEUR +10.3% ▪ Strong growth of revenues by 9.9% yoy to 284.5 mEUR (2020: 259.0 mEUR) primarily driven by consistent customer intake at 75.1 68.1 69.5 69.3 70.6 waipu.tv 65.2 65.0 1.5 60.7 ▪ Remarkable increase of gross
Slide 17: FCF Above Upper End of Guided Range, Dividend Proposal of 1.57 Euros
FCF ABOVE UPPER END OF GUIDED RANGE, DIVIDEND PROPOSAL OF 1.57 EUROS FROM EBITDA TO FREE CASH FLOW (FCF) DIVIDEND PROPOSAL FOR 2021 ACCORDING TO FINANCIAL POLICY in mEUR -28.1 -35.0 80 percent of free cash flow distributed -45.1 187.5 total distributon -72.6 0.4 mEUR -32.4 447.3 234.4 1.57* EUR per
Slide 18: EBITDA Ambition 2025 Not Back-End Loaded Towards the End
EBITDA AMBITION 2025 NOT BACK-END LOADED TOWARDS THE END ROAD TAKEN IN 2021 TO BE CONTINUED IN 2022, AMBITION 2025 REMAINS UNCHANGED CAGR ≥ 4% ≥ 4% > 520.0 447.3 450 - 470 425.9 2020 2021 2022e 2023e 2024e 2025e ▪ FY 2021 includes positive effects from short-time compensation countered by personne
Slide 19: Guidance 2022 Aligns with Promising Mid-Term Financial Ambition
GUIDANCE 2022 ALIGNS WITH PROMISING MID-TERM FINANCIAL AMBITION FINANCIAL GUIDANCE PRELIMS GUIDANCE in mEUR/ as indicated 2021 2022 ▪ Revenue 2,556.3 stable ▪ EBITDA 447.3 450 - 470 Mid point guidance approx. +4.0% CAGR vs. 2020 ▪ Free cash flow 234.4 230 - 250 Mid point guidance >50.0% EBITDA-to-FC
Slide 20: Free Cash Flow Bridge 2022
FREE CASH FLOW BRIDGE 2022 FROM EBITDA TO FREE CASH FLOW FCF QUARTERLY BREAKDOWN in mEUR in mEUR -30 50-70 50-70 50-70 50-70 -40 Mid point guidance: -50 >50.0% EBITDA-to-FCF -10 conversion -70 -25 5 447.3 230 - 250 450 - 470 Q1 22e Q2 22e Q3 22e Q4 22e EBITDA Change Tax Net Leases Interest Dividend
Slide 21: Special Issue 2022: Depreciation of mobilcom-debitel Brand
SPECIAL ISSUE 2022: DEPRECIATION OF MOBILCOM-DEBITEL BRAND LINEAR MELTDOWN OF BRAND ‘MOBILCOM-DEBITEL’ DUE TO BRAND TRANSFORMATION 100% ▪ The mobilcom-debitel brand is used in the Mobile Communications segment and recognised in the balance sheet at 293.2 -66.7% mEUR as of 31.12.2021 (-195.5 mEUR) ▪
Slide 22: Open for Your Questions.
OPEN FOR YOUR QUESTIONS. Untertitel (optional) FOR FOLLOW-UP QUESTIONS REACH OUT TO: freenet AG Investor Relations [email protected] www.freenet-group.de Fon: +49 (0)40 513 06 778