Vodafone Group Public Limited Company · LSE:VOD
Vodafone Group Public — Vodafone Spain — XIV Telecommunications Conference 2007
23 slides from Vodafone Group Public's conference presentation, Jun 21, 2007
Slide 1: XIV Telecommunications Conference
XIV Telecommunications Conference Francisco Román, CEO, Vodafone Spain 21st June 2007
Slide 2: Contents
Contents 1. Market overview 2. Vodafone Spain 3. Strategy 4. Summary Vodafone, the Vodafone logos, Vodafone Passport and Vodafone Mobile Connect are trade marks of the Vodafone Group. Other product and company names mentioned herein may be the trademarks of their respective owners. 2 XIV Telecommuni
Slide 3: Spanish mobile market
Spanish mobile market Customer market share Revenue market share1 % % MVNOs 0.6 100 Yoigo 0.2 100 30.5 30.9 33.2 34.4 80 80 60 23.8 60 19.0 23.0 18.4 40 40 45.7 45.3 47.9 47.2 20 20 0 0 Q4 05/06 Q4 06/07 Q4 05/06 Q4 06/07 Vodafone Orange Movistar Vodafone Spain Vodafone Spain is is growing growing c
Slide 4: Continuing strong growth in fixed to mobile substitution
Continuing strong growth in fixed to mobile substitution Voice minutes in fixed and mobile markets Fixed Mobile Mobile YoY growth Total mins (bn) 132.9 127.7 113.4 109.9 104.7 49% 43% +20% +18% 38% +28% 28% 33% +24% 72% 67% 62% 57% 51% 2002 2003 2004 2005 2006 Source: CMT (Spanish NRA) 4 XIV Telecom
Slide 5: Pricing environment
Pricing environment Mobile to fixed price premium Premium (excl. line rental) Premium (incl. line rental) Multiple 3.5 3.0 3.0 2.8 2.8 3.0 2.6 2.5 2.0 1.8 1.7 2.0 1.6 1.4 1.5 1.0 2002 2003 2004 2005 2006 Mobile market outgoing price per minute €cent/min Total Contract Prepaid 22.0 21.0 20.1 20.0 19.
Slide 6: Evolution of the market mix
Evolution of the market mix Contract share of customer base1 Migrant share of gross adds 55% 54.1% 40% 36% 53.9% 30% 27% 50% 20% 14% 45% 10% 40% 0% 2003 2004 2005 2006 Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Market Vodafone Total Contract Prepaid Increasing share Increasing share of of contract co
Slide 7: Regulatory environment
Regulatory environment • Regulator has approved a three year (Oct. 2006 to Oct. 2009) Termination termination rate glide path to €7 cents per minute rates • Vodafone Spain currently at €10.48 cents per minute, reducing to €9.61 cents per minute in October 2007 • Less than 1% market share at March 20
Slide 8: Contents
Contents 1.Market overview 2.Vodafone Spain 3.Strategy 4.Summary 8 XIV Telecommunications Conference – Vodafone Spain
Slide 9: Vodafone Spain – strong growth driver of Vodafone Group
Vodafone Spain – strong growth driver of Vodafone Group Customers Revenue EBITDA Vodafone Spain 14.9m €6.6bn €2.3bn FY06/07 Vodafone Spain 10.1% 13.3% 14.8% YoY growth Group 16.5% 4.3% 0.2% YoY growth1 Share of Group2 7.2% 14.5% 13.1% Source: Company data. 1 Growth disclosed on an statutory organic
Slide 10: Revenue growth drivers
Revenue growth drivers Customers1 ARPU +14.2% 47% 52% +4.2% -1.1% €35.6 €35.2 +25.1% 53% 48% FY05/06 FY06/07 FY05/06 FY06/07 Contract Prepaid Strong customer Strong customer and and usage usage growth growth leading leading to to 13% 13% service service revenue revenue growth growth Source: Company
Slide 11: Key drivers of success
Key drivers of success Net additions market share FY06/07 Key drivers 6% 2% 45% • Attractive offers 12% - Vitamina tariff and targeted promotions for consumers - Oficina Vodafone for enterprise • Product & service differentiation - 3G leadership - Vodafone Mobile Connect data cards 35% - Handheld bu
Slide 12: Attractive offers: “Tarifa Vitamina” and promotions
Attractive offers: “Tarifa Vitamina” and promotions MOU per customer Minutes Vodafone Movistar Orange 190 160 130 100 Q1 04 Q2 04 Q3 04 Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Tarifa Vitamina Tarifa Vitamina Promotions Promotions • Launched October 2005 • Christmas campaign (Dec.
Slide 13: 3G leadership: driving revenue and usage
3G leadership: driving revenue and usage 3G devices in the market Vodafone Spain ‘000s • 56% 3G market share 3,000 2,890 (March 2007) • 3G devices account for over 2,000 25% of service revenue 1,490 • Over 65% 3G coverage – with focus on indoor quality 1,000 695 • HSDPA enabled on 100% of the 3G net
Slide 14: Customer satisfaction
Customer satisfaction Customer delight index Key elements of success Index 72 • Attractive tariffs and appealing handsets 68.2 68 • 3G as a key differentiator 64.4 64 • Clear and distinct focus on the 61.9 different needs of consumer and enterprise customers 60 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Apr07 05/06 05
Slide 15: Contents
Contents 1.Market overview 2.Vodafone Spain 3.Strategy 4.Summary 15 XIV Telecommunications Conference – Vodafone Spain
Slide 16: Commercial strategy
Commercial strategy Vodafone Group Vodafone Spain • Promote FMS through Tarifa Vitamina, Nuevo Contrato 1 & Tarjeta 1, migrant offers, family plans and promotions Consumer • Customer base development and retention • Total communications solutions for data, fixed location services, DSL and advertisin
Slide 17: Oficina Vodafone: step by step fixed to mobile substitution
Oficina Vodafone: step by step fixed to mobile substitution Oficina Vodafone: Accessories A customer proposition that Incoming incorporates the best fixed Calls features into mobile phones 3G router Vodafone Fijo module Fixed Calls Zona Oficina – fixed national - module Internal Calls VPN Wireless O
Slide 18: Oficina Vodafone: in practice
Oficina Vodafone: in practice Commercial agreement with Irizar (bodywork manufacturer) Before Oficina Vodafone With Oficina Vodafone • Movistar client (75 mobiles) • Vodafone client (250 mobiles) • Two headquarters with switchboard, • Three headquarters – each with Oficiana Telefónica link and DECT
Slide 19: Cost management strategy
Cost management strategy 62.3% 61.6% 7.6% Acquisition costs 8.3% Volume, mix & price 6.9% Retention costs 6.7% Price (offset by volume) % of service revenue Interconnect 26.7% and other 25.3% Promoting on-net traffic direct costs Operating 21.1% expenses 21.3% Efficient cost management 21.8% FY05/06
Slide 20: Total communications strategy
Total communications strategy • Underlying data revenue growth of 60% in FY06/071 • Soon to launch new mobile internet propositions with leading partners: - Group: Google, MySpace, YouTube, eBay, MSN, Yahoo! Data - Local: including guia del ocio, meetic, BBVA, CajaMadrid, Grupo Banco Popular, La Cai
Slide 21: Total communications solutions
Total communications solutions Mobile broadband Mobile internet New business devices Vodafone Mobile BlackBerry R Palm Treo 750 USB modem Connect data card Curve 8300 • Surf&Talk: a similar tariff to ADSL (internet surfing and • Market leadership and the domestic fixed calls) but with most exclusive
Slide 22: Contents
Contents 1.Market overview 2.Vodafone Spain 3.Strategy 4.Summary 22 XIV Telecommunications Conference – Vodafone Spain
Slide 23: Summary
Summary Continued strong growth driven by: Innovative customer propositions stimulating usage and customer growth Strong data growth Further success enabled by: Focusing on fixed to mobile substitution Delivering mobile broadband products and services Providing total communications solutions Realisi
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