Pccw Limited · HKEX:8

Pccw — H1 2008 Earnings Presentation

28 slides from Pccw's earnings presentation, Aug 21, 2008

  1. Slide 1: 2008 Interim Results

    2008 Interim Results For the period ended June 30, 2008 August 21, 2008 - Hong Kong 0

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements This presentation may contain "forward-looking statements" that are not historical in nature. These forward-looking statements, which include, without limitation, statements regarding PCCW's future results of operations, financial condition or business prospects, are based

  3. Slide 3: Overview

    Overview Alex Arena Group Managing Director 2

  4. Slide 4: 2008 H1 Financial Performance

    2008 H1 Financial Performance (US$ million) H1’07 H1’08 2006年% Change Revenue 1,488 1,458 收益 Core 1,219 1,379 + 13% Business* EBITDA 463 441 EBITDA Core 394 432 + 10% Business* Profit Attributable 105 84 - 20% to Equity Holders 股權持有人 Profit Attributable to Equity 應佔溢利 Holders 59 85 + 45% (Core Busin

  5. Slide 5: Core Business Growth Accelerating

    Core Business Growth Accelerating Core Business Revenue Growth Core Business EBITDA Growth 13% 10% 7% 6% 4% 1% H1’06 H1’07 H1’08 H1’06 H1’07 H1’08 4

  6. Slide 6: Financial Review

    Financial Review Susanna Hui Group Chief Financial Officer 5

  7. Slide 7: Continued Robust Double-Digit Growth

    Continued Robust Double-Digit Growth (US$ million) Core Business* PCPD Revenue EBITDA Profit Attributable to Equity Holders % + 13 ess + 10% ness Core Busin Busi 5% Core 4 es s+ us in B ore C 1,379 85 1,219 432 394 59 46 269 79 69 9 (1) H1’07 H1’08 H1’07 H1’08 H1’07 H1’08 * Core business includes te

  8. Slide 8: Impressive Performance in All Core Segments

    Impressive Performance in All Core Segments (US$ million) Core Revenue TSS Breakdown 1 3 % yy--oo--yy Stable ++ 13 % Local 293 Telephony 300 + 9% TSS 1,379 Local Data & Broadband 284 310 245 + 20% Mobile 1,219 International 204 248 Others 200 + 25% TV & Content H1’07 H1’08 PCCW Solutions 1,096 TSS O

  9. Slide 9: QuadPlay Synergies Enhanced Cost Efficiency

    QuadPlay Synergies Enhanced Cost Efficiency Core Operating Expenses (US$ million) 360 340 TSS Core Opex to Revenue Ratio Mobile 232 267 TV & Content 28% 26% PCCW Solutions Other Businesses 51 H1’08 Eliminations 42 H1’07 32 28 24 26 54 47 (53) (50) H1’07 H1’08 8

  10. Slide 10: Uplifting Trend in Mobile & TV Clearly Emerging

    Uplifting Trend in Mobile & TV Clearly Emerging (US$ million) Core EBITDA o-y % yy--o-y ++ 1100% Mobile 432 14 394 TSS (7) Mobile H1’07 H1’08 TV & Content PCCW Solutions 455 TSS 440 + 3% TV & Content Other Businesses (5) (9) H1’07 H1’08 13 11 (43) (43) H1’07 H1’08 9

  11. Slide 11: Other Expenses In Line With Business Growth

    Other Expenses In Line With Business Growth (US$ million) 354 332 54 Tax 48 Net finance costs 76 78 Depreciation & amortization 206 224 H1'07 H1'08 10

  12. Slide 12: Group Performance

    Group Performance (US$ million) H1’07 H1’08 % change Revenue 1,488 1,458 Core Business 1,219 1,379 up 13% Cost of sales (666) (633) Operating expenses (359) (384) EBITDA 463 441 Core Business 394 432 up 10% Depreciation and amortization (206) (224) Operating profit 257 217 Other gains, net 7 2 Finan

  13. Slide 13: Prudent Debt Management

    Prudent Debt Management (US$ million) Revolving Credit Facilities Gross debt: US$3,509m US$ Bonds As of June 30, 2008 $1,301 $1,000 $500 $500 $205 2007 2008 2009 2010 2011 2012 2013 2014 2015 Update y Average cost of debt reduced to approximately 4.8% p.a. y Average debt maturity at approximately 4.

  14. Slide 14: Sound Credit Fundamentals

    Sound Credit Fundamentals Gross Debt/EBITDA (1) Net Debt PCCW consolidated (US$ million) HKTC 4.2 4.1 3.8 3.5 3.2 3.5 3.3 3.2 2,973 2,790 2,819 2,529 H2 H1 H2 H1 H2 H1 H2 H1 ’06 ’07 ’08 ’06 ’07 ’08 EBITDA/Interest (2) 6.3 5.5 5.0 5.1 5.1 H2 H1 H2 H1 4.2 4.4 2006 2007 2008 2.9 Gross Debt down 1% y-o-

  15. Slide 15: Business Review

    Business Review Alex Arena Group Managing Director 14

  16. Slide 16: QuadPlay Performance Update

    QuadPlay Performance Update Fixed line IPTV Broadband Mobile 15

  17. Slide 17: Stable Fixed-line Business

    Stable Fixed-line Business Update Fixed Lines (’000) Residential Lines y Solid customer base maintained since 2005 Business Lines - Firm ARPU trend continues y home multimedia service 1,667 1,543 - Subscribers growth increased significantly in 1,487 1,403 1,407 1,407 1,407 1,408 H1’08 induced by enh

  18. Slide 18: Market Leader in Broadband

    Market Leader in Broadband Broadband Lines Continue to Grow Achievements --yy (’000) yy--oo % ++88% 1,275 y NETVIGATOR led the broadband Wholesale 1,237 market, growing 8% y-o-y despite Business 1,176 Consumer 1,117 high market penetration 110 107 998 953 99 104 y Exclusive and unique content plus 8

  19. Slide 19: High Speed and Mobility Products Differentiate & Drive Broadband Growth

    High Speed and Mobility Products Differentiate & Drive Broadband Growth Grow ARPU Increased Speed w th r o e G nu 100M ve Re ew VDSL N 30M Differentiate Auto Network Selector ADSL 1.5-8M Over 4,000 hotspots Ubiquitous wireless platform Increased Mobility 18

  20. Slide 20: Mobile Performance

    Performance Growing Mobile Customer Base Improvements 3G • Total customer base reached 1.176m, up 23% --yy y-o-y 2G Post-paid yy--oo 3%% 2G Prepaid ++223 - Leading market net gain from mobile number 1,176 portability (’000) 1,071 957 288 • 3G customers doubled to 288,000 from H1’07 921 206 781 55 11

  21. Slide 21: Moving Forward to Mobile Content/Data Era

    Moving Forward to Mobile Content/Data Era High Speed Data Voice + Content + Data Quadplay Services Voice Data Demand Voice + Content Voice Voice-centric by SUNDAY 2G 3G 3G/ HSPA/ Wi-Fi Service Evolution 20

  22. Slide 22: Penetrating Mobile Data Markets

    Penetrating Mobile Data Markets PC Mobile Phone + NETVIGATOR Everywhere y Ubiquitous wireless platform integrating y Mobile data usage gained tremendous 3G, 7.2Mbps HSPA and WiFi with Auto momentum in the past year Network Selector - Increasing supply of smart gadgets has y Riding on the largest loc

  23. Slide 23: now TV Momentum Continues

    Momentum Continues Over 932K reached at end of July ‘08 Continues to Grow Drivers o--yy - yy- o % 33% 927 ++11 882 • Strongest line-up of international and local (’000) content with over 160 channels 818 Installed Base 758 - Over 85 exclusive world-class movies, sports, news Paying Base and general

  24. Slide 24: ARPU Accelerates

    ARPU Accelerates Paying Base & ARPU Strengthens ARPU Drivers Paying base (’000) Paying base ARPU (HK$/ month) • Continue to enhance ARPU by up-selling Mega Sports Pack pick-up customers onto premium content and new services, high value plans and buy-all packages Value packs further 199 213 Mini Pack

  25. Slide 25: Solid Performance on Four Platforms of PCCW Quadruple Play

    Solid Performance on Four Platforms of PCCW Quadruple Play Solid Performance y Fixed Line - Stable customer base with firm ARPU y Broadband - Leading market with high speed and mobility y Mobile - Fastest growing 3G, positive EBITDA y now TV - Largest local pay-TV operator and growing 24

  26. Slide 26: Appendix

    23 ONLY PCCW Appendix

  27. Slide 27: PCCW Consolidated Debt Maturity Profile

    PCCW Consolidated Debt Maturity Profile (US$ million) Net Debt = 2,498 Debt to EBITDA = (3,739 / 853) = 4.38x Dec 2005 $769 $1,000 $956 $450 $456 $500 $64 $500 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Net Debt = 2,529 Debt to EBITDA = (3,715 / 875) = 4.25x Dec 2006 $1,000 $956 $808 $50

  28. Slide 28: HKTC Debt Maturity Profile

    (US$ million) HKTC Debt Maturity Profile Net Debt = 3,709 HKTC Debt to EBITDA = (3,739 / 876) = 4.27x Dec 2005 $769 $1,000 $956 $450 $456 $500 $64 $500 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Net Debt = 2,888 HKTC Debt to EBITDA = (2,906 / 908) = 3.20x Dec 2006 $1,000 $956 $450 $456 $

PCCW — H1 2008 Earnings Presentation on 6ix