Telecom Italia S.p.a. · MIL:TIT
Telecom Italia — 9M 2009 Earnings Presentation
21 slides from Telecom Italia's earnings presentation, Nov 5, 2009
Slide 1: Telecom Italia 9M 2009 Financial Results
TELECOM ITALIA GROUP 9M 2009 Results Milan, November 5h, 2009 Telecom Italia 9M 2009 Financial Results MARCO PATUANO
Slide 2: Safe Harbour
TELECOM ITALIA GROUP 9M 2009 Results Safe Harbour These presentations contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements appear in a number of places in this presentation and include statements re
Slide 3: TI Group 9M 09 Financial Progress Report
TELECOM ITALIA GROUP 9M 2009 Results TI Group 9M 09 Financial Progress Report Stable EBITDA and Improved Operating Profitability: Ebitda 8.6BN€ -0.4% YoY (Ebitda Margin +1.8 p.p. YoY) Focus on Improved Domestic Ebitda trend: Core -0.4% 3Q; -0.7% 2Q; -4.4% 1Q Markets: Strong Cash Cost Control: Domest
Slide 4: Improved Operating Free Cash Flow
TELECOM ITALIA GROUP 9M 2009 Results Improved Operating Free Cash Flow Euro mln, Reported data Operating FCF +5.6 p.p. 25.0% +515 +5.5 p.p. 19.4% % OFCF on Revenues 13.9% 3,932 1Q09 2Q09 3Q09 3,417 2,808 2,979 EBITDA 2,739 +3.6 p.p. 19.5% 968 1,076 Capex 954 15.9% WC Change 500 215 881 % OFCF on & O
Slide 5: Group Cash Cost Control to improve Operating Cash Flow
TELECOM ITALIA GROUP 9M 2009 Results Group Cash Cost Control to improve Operating Cash Flow Euro mln, Organic data, % TI Group Cash Cost Domestic Cash Cost Of which: Domestic -775 -1,003 -8.4% -1,146 -7.3% Brazil -56 15,724 11,892 14,578 CAPEX 10,889 CAPEX (*) -7.8% -8.6% -253 -228 OPEX OPEX -8.4% -
Slide 6: Domestic Efficiency on track
TELECOM ITALIA GROUP 9M 2009 Results Domestic Efficiency on track 9M 09 Efficiency Program Efficiency 9M 09 Euro Mln, Organic Data o/w Opex opex capex 277 640 Total 640 363 9M ‘08 9,246 2,646 1 Network Operations 193 17 363 Sales & 2 Distribution 127 127 growth -363 Organization & 3 Support process
Slide 7: Domestic EBITDA change vs 2008
TELECOM ITALIA GROUP 9M 2009 Results Domestic EBITDA change vs 2008 Euro million, %, Organic data 7,913 (223) +282 (697) +107 (23) +69 7,768 +306 +34 Handset Commercial margin +59 Gross Margin Services -357 Costs: +84 Commercial Margin -214 -145M€, -1.8% Ebitda Margin 46.1% +1.7 p.p. 47.8% 9M 08 Han
Slide 8: Non Core Assets Disposal: HanseNet
TELECOM ITALIA GROUP 9M 2009 Results Non Core Assets Disposal: HanseNet Book Value (Consolidated Accounts) Euro Million 610 1,440 o/w 582 Goodwill 665 (78) 830 Key Points 243 661 GW Disposal of non core assets: expected cash in approx. 900 million ’03 100% ’07 100% ’03-’09 capital Equity NFP 9M09 En
Slide 9: TI Group – Tax Trend
TELECOM ITALIA GROUP 9M 2009 Results TI Group – Tax Trend Net Income Before Taxes and Disc. Ops. P&L Taxes Euro million Euro million No tax impact: Call Sofora: -190; Lehman: -51 Tax adj. Financial Law 08: -515 Tax Dispute : +137 2,676 969 2,257 +7.1% 520 +7.9% Adjusted Adjusted 9M08 9M09 9M08 9M09
Slide 10: Net Income Evolution – 3Q09 vs. 3Q08
TELECOM ITALIA GROUP 9M 2009 Results Net Income Evolution – 3Q09 vs. 3Q08 Euro mln HanseNet GW Writedown (540) EBITDA (32) HanseNet Net Income (1) Depreciation & Amortization +47 Writedowns of non current assets +14 Gain on Liberty Surf Grp disposal +36 748 (541) +184 626 (7) (120) 499 +29 (6) 201 +
Slide 11: Net Debt Dynamics
TELECOM ITALIA GROUP 9M 2009 Results FY09 NFP Adjusted Estimate: Net Debt Dynamics ~34BN€ Euro mln +1,814 Cash Financial Expenses (-) = Cash generated, (+) = Cash absorbed (301) Financial Accruals o/w +1,171 Income Taxes +84 Disc. Ops. HanseNet +244 Tax Litigation +214 Substitutive Tax +349 35,093 +
Slide 12: Cost of Debt
TELECOM ITALIA GROUP 9M 2009 Results Cost of Debt Net Financial Position Adj and Liquidity Net Financial Expenses Euro billion Euro million 1,632 34.5 34.9 35.1 1,077 580 1.3 cash taxes + 1.8 bond redemption in July 1Q09 1HQ09 9M09 Liquidity 8.1 5.9 5.6 Position Δ YoY -12 -127 -311 1Q09 1HQ09 9M09 C
Slide 13: Appendix
TELECOM ITALIA GROUP 9M 2009 Results Appendix 12 MARCO PATUANO
Slide 14: Revenues Evolution
TELECOM ITALIA GROUP 9M 2009 Results Revenues Evolution TI Group, Euro mln Media (50) Domestic +16 Bolivia (52) Brazil (385) Elimination +47 Olivetti (1) 21,520 (55) (370) +24 21,119 (920) +34 +2 (32) (9) 20,194 (6) 20,188 Organic Variation 9M 09 -925 (-4.4%) 9M08 Change in Exchange Other non 9M08 D
Slide 15: EBITDA Evolution
TELECOM ITALIA GROUP 9M 2009 Results EBITDA Evolution TI Group, Euro mln Mobility under Law 223/91 related to Reduction Plan announced on June 4th 2008 +287 Agreement with OLO and provisions Agreement with OLO and provisions for legal for legal disputes (47) Media +17 disputes +37 Agreement with OLO
Slide 16: EBIT Evolution
TELECOM ITALIA GROUP 9M 2009 Results EBIT Evolution TI Group, Euro mln Mobility under Law 223/91 related to Reduction Plan announced on June 4th 2008 +287 Agreement with OLO and provisions for legal Agreement with OLO and provisions disputes +37 for legal disputes (47) Gain on Real Estate disposal (
Slide 17: Focus on Domestic Efficiency
TELECOM ITALIA GROUP 9M 2009 Results Focus on Domestic Efficiency Euro Mln, Organic data Δ Abs vs. of which of which 9M 09 Efficiency on Opex 9 M ‘08 Efficiency Growth* Interconnection 2,330 -306 -- -306 9,246 8,834 8,471 Marketing & Sales 2,174 -399 -161 -238 (412) fee (363) Personnel 2,440 -3 -72
Slide 18: Group Liquidity Matches 2009 – 2010 Maturities
TELECOM ITALIA GROUP 9M 2009 Results Group Liquidity Matches 2009 – 2010 Maturities Euro mln Bonds Loans (of which long-term rent, financial and operating lease payable € 1,797) Drawn bank facility € 5.9 bln Group Liquidity Position + 16,561 40,562 * € 6.5 bln 3,000 Undrawn Portion of € 8 bln Facili
Slide 19: TI Group – Profit and Loss
TELECOM ITALIA GROUP 9M 2009 Results TI Group – Profit and Loss I Half III Quarter 9 Months Euro mln 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% REVENUES 13.424 14.247 (823) (5,8) 6.764 7.273 (509) (7,0) 20.188 21.520 (1.332) (6,2) Other Operating Income 136 151 (15) (9,9) 48 64 (16) (2
Slide 20: TI Group - Main Results by BU - by Quarter - Reported
TELECOM ITALIA GROUP 9M 2009 Results TI Group - Main Results by BU - by Quarter - Reported I Quarter II Quarter III Quarter 9 Months Euro mln 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% REVENUES Domestic 5.357 5.600 -243 (4,3) 5.534 5.791 -257 (4,4) 5.342 5.728 -386 (
Slide 21: TI Group - Main Results by BU - by Quarter - Organic
TELECOM ITALIA GROUP 9M 2009 Results TI Group - Main Results by BU - by Quarter - Organic I Quarter II Quarter III Quarter 9 Months Euro mln 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% 2009 2008 ∆ Abs ∆% REVENUES Domestic 5.357 5.607 -250 (4,5) 5.534 5.821 -287 (4,9) 5.348 5.731 -383 (6