Freenet Ag · XETR:FNTN
Freenet — Q1 2021 Earnings Presentation
21 slides from Freenet's earnings presentation, May 6, 2021
Slide 1: Management Presentation: Results for Q1 2021
MANAGEMENT PRESENTATION Results for Q1 2021 CHRISTOPH VILANEK, CEO INGO ARNOLD, CFO 6 May 2021 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: 2021 Starts with Growth at All Levels
2021 STARTS WITH GROWTH AT ALL LEVELS 8,648 +218.0 000‘s 000‘s SUBSCRIBER BASE S T R O N G C U S TO M E R I N TA K E 108.8 mEUR +4.6 mEUR EBITDA GROWTH THROUGH TV & MEDIA 59.5 +9.6 mEUR mEUR FREE CASH FLOW I N C L . W O R K I N G C A P I TA L P H A S I N G Q 4 / 2 0 06.05.2021 4
Slide 5: Highlights Q1 2021
HIGHLIGHTS Q1 2021 MOBILE COMMUNICATIONS GROUP ▪ Targeted promotions and upgrades for pure digital/app- ▪ Share buyback program 2021 started end of February with based tariffs (e.g. data volume, VoLTE, speed) more than 1.5 million shares bought back for around 30.0 million euros ▪ Customer-oriented
Slide 6: Growth in Subscriber Base Continued
GROWTH IN SUBSCRIBER BASE CONTINUED DEVELOPMENT PER SUBSCRIBER BASE TOTAL SUBSCRIBER BASE in ´000s in ´000s 6,925.0 +218.0 P O S T PA I D +2.5% (+2.6%) 7,099.4 +0.4% +1.2% 35.3 8,647.6 +0.2% 8,609.8 FUNK & FLEX1 +93.5% +0.7% 68.3 8,490.4 8,506.7 8,429.6 452.5 W A I P U .T V +35.2% 611.7 1,016.9 FREE
Slide 7: App-Based Tariffs Adding Additional Growth to High Margin Customer Base
APP-BASED TARIFFS ADDING ADDITIONAL GROWTH TO HIGH MARGIN CUSTOMER BASE HIGH-VALUE MOBILE CUSTOMER BASE APPROX. 60% OF GROSS ADDS VIA in ‘000s NON-RETAIL CHANNELS (L4Q) +207.4 (+3.0%) 52% 41% 7,167.7 7,135.4 48% 59% 68.3 56.8 7,055.2 Q2/19-Q1/20 Q2/20-Q1/21 50.3 Retail channels Non-retail channels 6
Slide 8: Media Broadcast: freenet TV Pricing Strategy Adds Profitability
MEDIA BROADCAST: FREENET TV PRICING STRATEGY ADDS PROFITABILITY FREENET TV EBITDA DEVELOPMENT B2B DEVELOPMENTS Indexed +40.3% ▪ Media Broadcast expands infrastructure expertise +54.2% to 5G by offering turnkey, provider-independent communications infrastructure for your entire premises. 2019 2020 Q1
Slide 9: waipu.tv Again with High Customer Intake (+39,200)
WAIPU.TV AGAIN WITH HIGH CUSTOMER INTAKE (+39,200) FOCUS ON QUALITY AND EBITDA SUBSCRIBER BASE DEVELOPMENT in ‘000s ▪ Strong subscriber growth despite 30% retail price +325.3 +159.2 +39.2 (+113.6%) (+35.2%) (+6.8%) increase of flagship product Perfect Plus effective January 2021 572.5 611.7 509.5 ▪
Slide 10: Outlook
OUTLOOK MOBILE COMMUNICATIONS ▪ At least stable development in terms of + TV & MEDIA Media Broadcast customer base ▪ Q3 21 with relevant sports events ▪ Further focus on margin and customer lifetime ▪ Reopening of retail key for freenet TV value ▪ All 15 DAB channels sold and live, advertising ▪ Omn
Slide 11: Sharp Increase in Consolidated EBITDA
SHARP INCREASE IN CONSOLIDATED EBITDA REVENUES Q1 21 VS. Q1 20 in mEUR -4.6% ▪ Revenue down 4.6% yoy, mainly due to decline in low-margin hardware sales as a result of pandemic-related store closures 648.8 622.1 634.5 670.7 619.2 ▪ Gross profit on previous year‘s level despite missing freenet digita
Slide 12: Mobile Demonstrates Its Resilience
MOBILE DEMONSTRATES ITS RESILIENCE REVENUES Q1 21 VS. Q1 20 in mEUR -5.8% ▪ Revenue down 5.8% yoy, mainly resulting from decline of low- 582.6 602.4 margin hardware and variable service revenue; both pandemic- 554.2 567.0 548.7 30.9 28.3 37.7 37.5 related 31.4 138.0 31.3 120.9 28.8 117.7 29.7 154.0
Slide 13: Mobile Customer Base Growing Despite Lockdown
MOBILE CUSTOMER BASE GROWING DESPITE LOCKDOWN HIGH-VALUE MOBILE CUSTOMER BASE Q1 21 VS. Q1 20 in ‘000s ▪ Mobile customer base continuously increasing despite challenging +3.0% environment due to Covid-19 7,135.4 7,167.7 ▪ ARPU stable compared to Q4 20; yoy decrease reflecting 7,055.2 56.8 68.3 headw
Slide 14: waipu.tv Drives Growth
WAIPU.TV DRIVES GROWTH REVENUE Q1 21 VS. Q1 20 in mEUR +14.6% ▪ Revenue up 14.6% yoy, mainly based on solid waipu.tv subscriber/ARPU growth and positive effect from 20% price 69.5 increase at freenet TV in May 2020 68.1 65.2 65.0 1.5 ▪ Significant increase of gross profit (+20.3% yoy) and EBITDA 60.
Slide 15: Each TV and Media Division Improves
EACH TV AND MEDIA DIVISION IMPROVES GROSS PROFIT Q1 21 VS. Q1 20 EXPLANATION S +3.2 mEUR 4.6 45.8 ▪ MB B2C: Gross profit improvement 3.1 due to effect from price increase vs. 1.5 average freenet TV customer base; 38.1 2.1 1.1 at EBITDA level, further cost 168.8 measures become visible ▪ MB B2B: Gros
Slide 16: Free Cash Flow on Upper End of Quarterly Guidance
FREE CASH FLOW ON UPPER END OF QUARTERLY GUIDANCE EBITDA TO SUSTAINABLE FREE CASH FLOW (FCF) QUARTERLY BREAKDOWN 2021 in mEUR in mEUR (2020 excl. Sunrise dividend and interest payments syndicated bank loan) -9.0 82.1 -6.0 -8.6 59.5 47.4 45-60 45-60 45-60 -17.2 -8.7 18.9 0.1 108.8 59.5 Q1 21 Q2 20 Q2
Slide 17: Further Debt Relief and Maturity Structure Optimization in Q1 21
FURTHER DEBT RELIEF AND MATURITY STRUCTURE OPTIMIZATION IN Q1 21 SITUATION YEAR-END 2019 SITUATION YEAR-END 2020 SITUATION AS OF 31.03.2021 In mEUR In mEUR In mEUR FY 2020: Sunrise divestment, March 2021: Repayment of promissory repayment of bank loan (610 mEUR), notes (200 mEUR) refinancing of prom
Slide 18: Key Financial KPIs
KEY FINANCIAL KPI´S 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 26.6% 40.4% 43.2% 4.7x 4.0x 4,764.6 4,505.6 4,242.8 1,987.4 1.7x 1.6x 1,508.8 0
Slide 19: Financial Guidance for FY 2021 Confirmed
FINANCIAL GUIDANCE FOR FY 2021 CONFIRMED SUBSCRIBER GUIDANCE ACTUAL GUIDANCE in ‘000s 2020 2021 ▪ Postpaid customer (w/o digital/app-based tariffs) 7,078.7 Moderate increase ▪ freenet TV RGU 901.9 Moderate decrease ▪ waipu.tv subscriber 572.5 Solid growth FINANCIAL GUIDANCE ACTUAL GUIDANCE in mEUR/
Slide 20: Open for Your Questions.
OPEN FOR YOUR QUESTIONS. Untertitel (optional) FOR FOLLOW-UP QUESTIONS REACH OUT TO: Investor Relations & ESG [email protected] www.freenet-group.de Fon: +49 (0)40 513 06 778
Slide 21: Balance of Retail and Non-Retail Adjusted to Covid-19 Situation
BALANCE OF RETAIL AND NON-RETAIL ADJUSTED TO COVID-19-SITUATION IMMEDIATE ADAPTION TO NEW SITUATION CAPTIVE CHANNEL EXPANSION Gross adds Renewals Gross adds & Renewals 30% 26% 35% 28% 52% 41% 59% 70% 74% 65% 72% 48% Q2/19-Q1/20 Q2/20-Q1/21 Q2/19-Q1/20 Q2/20-Q1/21 Q2/19-Q1/20 Q2/20-Q1/21 Retail chann