Pharol Sgps S.a. · EURONEXT:PHR
Pharol Sgps — Portugal Telecom SGPS — FY2006 Earnings Presentation
8 slides from Pharol Sgps's earnings presentation, Feb 9, 2007
Slide 1: Revenue and EBITDA performance by division
Revenue and EBITDA performance by division
Slide 2: Revenue drivers by division
> Vivo (Real appreciation), PTM and consolidation of MTC had positive contribution to consolidated revenues. > Line loss and lower traffic impacted negatively Wireline revenues. > MTR cuts had negative impact of €49mn in TMN revenues.
Slide 3: EBITDA drivers by division
> Cost cutting allowed wireline to offset partially top line pressure at EBITDA level. > Excluding MTR cuts (€26mn), TMN EBITDA would have increased by 1.6% yoy. > PTM EBITDA rose by 8.1% yoy, underpinned by Pay TV ARPU. Portugal Telecom | February 2007 Strong cash flow performance
Slide 4: Strong cash flow performance
> OpFCF up by 22% yoy to €1.6bn, underpinned by working capital improvement > FCF before net financial investments increased by 35% yoy > Net divestments of €365mn in 2005 (Lusomundo, Primesys, UOL IPO) vs. net investments of €143mn in 2006 (MTC, BES) Portugal Telecom | February 2007 Net income reac
Slide 5: Net income reached historical high
> Net income increased by 33% yoy to €867mn. > Increase in net income resulted from primarily: – Lower income taxes: capital gain in 1Q06 (€53mn), adoption voluntary taxation on capital gains (€142mn), and recognition of tax credit at Vivo (€134mn). – Lower curtailment cost: redundancy programme enc
Slide 6: Solid debt profile
> Net debt down €352mn in 4Q06 as a result of FCF generated. > Cash plus undrawn facilities totalled €2.5bn at the end of Dec 2006. > Average cost of debt (excl. Vivo and PTM swaps) stood at 3.8% in 2006. > Debt maturity excluding Brazil is 7.9 yrs. Portugal Telecom | February 2007 Significant reduc
Slide 7: Significant reduction in unfunded post retirement obligations
> Combination of several factors resulted in strong reduction of unfunded post retirement obligations. > Adjustment to PT’s healthcare plan and decision not to sign new protocol with SNS lowered PBO by €367mn. > After tax net unfunded amounted to €1.2bn at the end of 2006. > Pension funds outperform
Slide 8: Strong increase in distributable reserves
> Distributable reserves totalled €2.8bn at the end of Dec 06, following: – Share capital reduction (€1.1bn), – Internal corporate restructuring (€0.8bn) . Portugal Telecom | February 2007 Financial highlights