Freenet Ag · XETR:FNTN
Freenet — Q1 2022 Earnings Presentation
21 slides from Freenet's earnings presentation, May 13, 2022
Slide 1: Management Presentation: Results for Q1 2022
MANAGEMENT PRESENTATION Results for Q1 2022 CHRISTOPH VILANEK, CEO INGO ARNOLD, CFO 13 May 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 B U S I N ES S C . V I L A N E K , C EO 2 FINANCIALS I . A R N O L D, C FO 3 Q&A
Slide 4: freenet Carries Out Guidance 2022
FREENET CARRIES OUT GUIDANCE 2022 8,811 +163.5 000s 000s TOTA L S U B S C R I B E R B A S E H I G H C U S TO M E R I N TA K E 118.0 mEUR +9.2 mEUR EBITDA G R O W T H I N B OT H S E G M E N T S 62.7 +3.3 mEUR mEUR FREE CASH FLOW I N L I N E W I T H Q U A R T E R LY E X P E C TAT I O N 13.05.2022 4
Slide 5: +163,500 Subscribers YoY and +26,000 Net Adds in Q1
+163,500 SUBSCRIBERS YOY AND +26,000 NET ADDS IN Q1 SUBSCRIBER BASE TOTAL SUBSCRIBER BASE SUBSCRIBER BASE BREAK-DOWN in ´000s in ´000s +163.5 (+1.9%) 7,099.4 P O S T PA I D +1.2% 7,182.8 +0.9% +0.3% +0.4% +0.3% 8,811.1 8,785.1 68.3 8,680.8 8,704.8 FUNK & FLEX1 +44.2% 8,647.6 98.4 611.7 W A I P U .T
Slide 6: +15,200 Mobile Net Adds as a Function of EECC
+15,200 MOBILE NET ADDS AS A FUNCTION OF EECC TARIFF AND SALES CHANNEL MOBILE SUBSCRIBER DEVELOPMENT PORTFOLIO EXPANDED in ‘000s ▪ Own 5G tariff offers complement MNO 5G tariffs (T-Mobile + +113.5 Vodafone) in the portfolio (+1.6%) ▪ Brand transformation and rebranding to ‘freenet’ ongoing; with 7,2
Slide 7: TV Campaign with Dieter Bohlen Pays Off – Strongest Q1 Since Launch
TV CAMPAIGN WITH DIETER BOHLEN PAYS OFF – STRONGEST Q1 SINCE LAUNCH OPERATIONAL HIGHLIGHTS WAIPU.TV SUBSCRIBERS in ‘000s ▪ Expansion of cooperation with RTL to include RTL's pay-TV +157.3 +46.5 (+25.7%) (+6.4%) offering increases attractiveness of waipu.tv platform further 769.0 ▪ Cooperation with D
Slide 8: Media Broadcast Cooperates with 1&1
MEDIA BROADCAST COOPERATES WITH 1&1 OPERATIONAL HIGHLIGHTS freenet TV ▪ Celebrating 5th anniversary, churn continues in Q1, but EBITDA remains stable due to efficiency gains ▪ Price increase of 1 Euro per month in Q3 to compensate customer attrition B2B ▪ Conclusion of a long-term contract with 1&1
Slide 9: Outlook into Q2
OUTLOOK INTO Q2 MOBILE COMMUNICATIONS TV AND MEDIA ▪ We expect stronger net adds than in Q1 ▪ waipu.tv will start initial transformation campaigns with Deutsche Glasfaser and some other small ▪ Müller Mobile to be launched; 3 tariffs including local fibre providers DLS offers in a cooperation with d
Slide 10: Group – Stable Revenues, but Higher Profitability
GROUP – STABLE REVENUES, BUT HIGHER PROFITABILITY GROUP REVENUES Q1 22 VS. Q1 21 in mEUR -0.4% ▪ Group revenues – as expected – stable (-0.4% yoy) 619.2 619.9 641.8 675.5 616.8 ▪ Gross profit benefits from operational growth in both segments; up to 218.2 mEUR (+1.9% yoy) ▪ EBITDA reflects strong ope
Slide 11: Mobile – No Signs of Weakness
MOBILE – NO SIGNS OF WEAKNESS REVENUES Q1 22 VS. Q1 21 in mEUR -0.7% ▪ Mobile Communications revenues stable (-0.7% yoy) at 544.6 548.7 551.1 571.2 599.7 544.6 mEUR (Q1 21: 548.7 mEUR), but quality increased 29.0 29.7 31.4 112.0 29.1 111.2 121.5 155.8 25.5 109.9 ▪ Share of service revenues up to 75.
Slide 12: Stable ARPU Contributes to Service Revenue Growth
STABLE ARPU CONTRIBUTES TO SERVICE REVENUE GROWTH HIGH-VALUE MOBILE CUSTOMER BASE Q1 22 VS. Q1 21 in ‘000s +113.5 (+1.6%) ▪ Growing mobile customer base with comparably high profitability and loyalty (+1.6% yoy to 7,281.2 k) 7,266.0 7,281.2 7,167.7 7,191.2 7,223.0 88.0 98.4 ▪ Postpaid ARPU stable at
Slide 13: TV and Media – EBITDA Margin Improves to Above 34 Percent
TV AND MEDIA – EBITDA MARGIN IMPROVES TO ABOVE 34 PERCENT REVENUES Q1 22 VS. Q1 21 in mEUR +6.3% ▪ Strong revenue growth by +8.7% yoy (w/o Media Barter Deal) to 75.1 73.9 mEUR, mainly driven by waipu.tv customer growth 73.9 69.5 70.6 1.5 69.3 +8.7% ▪ Remarkable increase of gross profit; up by +6.5%
Slide 14: Free Cash Flow in Line with Guidance
FREE CASH FLOW IN LINE WITH GUIDANCE FROM EBITDA TO FREE CASH FLOW (FCF) FCF QUARTERLY BREAKDOWN in mEUR in mEUR 62.7 50-70 50-70 50-70 -17.0 -8.3 -12.8 Q1 22 Q2 22e Q3 22e Q4 22e 5.5 0.0 -18.2 -4.6 FURTHER EXPLANATIONS ▪ CapEx higher due to site renovation in 118.0 62.7 Büdelsdorf (ca. 2.0 mEUR) an
Slide 15: Adjusted Earnings Figures Due to mobilcom-debitel Brand Amortisation
ADJUSTED EARNINGS FIGURES DUE TO MOBILCOM-DEBITEL BRAND AMORTISATION RECONCILIATION OF EBITDA TO ADJUSTED GROUP RESULT in mEUR 118.0 80.2 80.6 0.4 -84.9 -11.0 -6.8 62.8 EPS (ADJ.) 47.0 Effect 40.2 from adjustments 22.5 +0.13 CENT EBITDA Depreciation Amortisation Adjusted EBIT Financial result Adjust
Slide 16: Healthy Balance Sheet KPIs
HEALTHY BALANCE SHEET KPIS TOTAL ASSETS & NET DEBT & BANK NET DEBT & EQUITY RATIO LEVERAGE* B A N K L E V E R A G E */** (Lower limit: >25%) (Upper limit: ≤3,0x) in mEUR/ as indicated in mEUR/ as indicated in mEUR/ as indicated 43.2% 41.5% 42.3% 1.6x 1.8x 1.6x 0.6x 0.9x 0.8x 4,242.8 3,952.4 3,882.3
Slide 17: Guidance 2022 Reiterated
GUIDANCE 2022 REITERATED FINANCIAL GUIDANCE RESULTS GUIDANCE in mEUR 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-FCF conversion SUBSCRIBER GUIDANCE in ‘000s ▪ Postpaid
Slide 18: 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
Slide 19: Special Issue: Depreciation of mobilcom-debitel Brand
SPECIAL ISSUE: DEPRECIATION OF MOBILCOM-DEBITEL BRAND LINEAR MELTDOWN OF BRAND ‘MOBILCOM-DEBITEL’ DUE TO BRAND TRANSFORMATION 66.4% 194.7mEUR 100% ▪ The mobilcom-debitel brand is used in the Mobile Communications segment and recognised in the balance sheet at 293.2 mEUR as of 31.12.2021 ▪ Linear mel
Slide 20: Free Cash Flow Bridge 2022
FREE CASH FLOW BRIDGE 2022 FROM EBITDA TO FREE CASH FLOW in mEUR -30 -40 Mid point guidance: -50 >50.0% EBITDA-to-FCF -10 conversion -70 -25 5 447.3 450-470 230-250 EBITDA Change Tax Net Leases Interest Dividend FCF 2022e NWC payments CapEx payments payment 2022e Ceconomy Renovation Headquarters Büd
Slide 21: 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 13.05.2022 21