Vodafone Group Public Limited Company · LSE:VOD
Vodafone Group Public — Vodafone Group — Q3 16/17 Earnings Presentation
30 slides from Vodafone Group Public's earnings presentation, Feb 2, 2017
Slide 1: Vodafone Group Plc Trading update
Vodafone Group Plc Trading update For the quarter ended 31 December 2016 2 February 2017
Slide 2: Disclaimer
Disclaimer Information in this presentation relating to the price at which This presentation also contains non-GAAP information which the relevant investments have been bought or sold in the past or the Group’s management believes is valuable in understanding the yield on such investments cannot be
Slide 3: Commercial review
Commercial review Vittorio Colao Group Chief Executive
Slide 4: Q3 16/17 highlights
Q3 16/17 highlights Financial Growth engines Customer Service revenue experience €12.3bn 4G driving Consumer NPS Group +1.7% data volumes Co/leader +53% in 18/21 markets €8.1bn Europe: +0.7% Enterprise Co/best data Sustained commercial outperformance network 15/21 markets performance revenue +3.3% €
Slide 5: Commercial momentum
Commercial momentum Customer experience Growing customer base Consumer NPS1 (points) Customer net adds (000s)2 Gap to next best competitor Mobile contract India Gap to third Fixed broadband 14 14 1,425 1,415 12 1,290 10 1,135 1,048 2 0 1 414 416 348 417 327 (3) Q3 14/15 Q3 15/16 Q2 16/17 Q3 16/17 Q3
Slide 6: All growth engines contributing
All growth engines contributing Q3 16/17 service revenue growth contribution (pp) 1.2 0.7 Data (excl. roaming) 1.7 0.9 (0.8) 1.0 0.0 (excl. roaming) (0.1) European consumer AMAP consumer Enterprise Consumer fixed line Carrier, wholesale Q3 16/17 mobile mobile and other¹ • Delivering growth from bran
Slide 7: Growth engines: data take-up
Growth engines: data take-up Mobile data traffic rising due to 4G Stabilising European ARPU Consumer contract (local currency) Volume (PB) Growth (%) UK Germany Spain Italy (consumer prepaid) 800 80 28.3 28.1 28.1 28.5 27.6 70 700 68 24.5 23.9 24.2 24.8 24.4 65 53 60 61 59 20.0 20.1 19.8 19.0 19.6 6
Slide 8: Growth engines: enterprise
Growth engines: enterprise Diversified revenue streams Growth in fixed driving outperformance Service revenue splits Enterprise service revenue growth (%) Mobile Group Fixed Multi-National AMAP Fixed Corporate 2.5 3.3 3.3 Public Sector National 5.4 Corporate 4.7 4.6 SME 2.8 2.5 Europe Mobile 1.7 SOH
Slide 9: Growth engines: fixed momentum
Growth engines: fixed momentum Record net adds Largest NGN footprint in Europe Group fixed broadband net adds (000s)1 European NGN homes reached (m)2 Total NGN Total On Net % Penetration3 457 12% 414 416 415 417 374 381 9% 90 348 354 327 69 24% 19% 38 28 Q3 15/16 Q4 15/16 Q1 16/17 Q2 16/17 Q3 16/17
Slide 10: VodafoneZiggo: JV creates a fully-converged operator
VodafoneZiggo: JV creates a fully-converged operator A strong integrated player Operational Total communications revenue market share (%)1 Board and management in place Other Tele2 8 T-Mobile 4 Commercial 8 37 VodafoneZiggo Co-branded convergence proposition in Spring Q2 UPDATE Customer targeting in
Slide 11: Operational review
Operational review Nick Read Group Chief Financial Officer
Slide 12: Continued growth in Europe, slowdown in India
Continued growth in Europe, slowdown in India Q3 16/17 organic service revenue (%) Q3 15/16 Q4 15/162 Q1 16/17 Q2 16/17 Q3 16/17 Europe (0.6) 0.5 (0.3) 0.3 1.0 0.7 19.6 AMAP 6.5 8.1 7.4 7.7 7.1 3.9 Group 1.4 2.5 1.8 2.2 2.4 1.7 15.0 Group 1.3 2.1 1.7 2.0 2.2 (Ex. India) 8.3 4.1 4.0 3.0 2.8 2.2 1.8 1
Slide 13: Germany: steady underlying growth
Germany: steady underlying growth Customer experience KPIs Financial results Consumer NPS (points) Customer net adds (000s) Service revenue growth (%) Gap to next best Mobile contract Reported 3.2 Gap to third Fixed Growth ex MTR impact 2.2 17 1.7 14 1.7 196 3.1 8 134 1.6 1.6 1.8 105 108 110 1 92 (0
Slide 14: Italy: growing in a promotional market
Italy: growing in a promotional market Customer experience KPIs Financials Consumer NPS (points) Customer net adds (000s) Service revenue growth (%) Gap to next best Mobile 3.0 Gap to third Fixed 63 70 2.2 9 38 46 33 1.3 1.2 6 4 2 0 (0.3) (266) (261) (289) (4) (318) (344) Q3 15/16 Q2 16/17 Q3 16/17
Slide 15: UK: operational progress, increased enterprise competition
UK: operational progress, increased enterprise competition Customer experience KPIs Financials Average monthly call volumes (m) Customer net adds (000s) Service revenue growth (%) Mobile contract Reported 2.1 Fixed Q4 ex. carrier effect 94 99 92 1.7 1.5 (0.1) 1.5 1.4 (0.7) (0.8) 26 28 30 14 20 16 (2
Slide 16: Spain: strong momentum
Spain: strong momentum Customer experience KPIs Financials Consumer NPS (points) Customer net adds (000s) Service revenue growth (%) Gap to next best Mobile contract Reported Gap to third Fixed Ex. handset financing 105 4.9 91 97 93 4.1 12 83 79 3.5 64 0.7 0.6 1.3 0.8 8 8 0.0 53 5 5 40 (3.1) (3.2) 0
Slide 17: India: increasing competitive pressures
India: increasing competitive pressures Customer experience Usage impacted by competition Financial results Consumer NPS (points) Data users (m) Service revenue growth (%) Gap to next best Total 6.4 Gap to third 3G/4G 5.3 5.4 8 67 68 70 70 65 2.3 6 4 36 32 35 26 28 2 2 1 (1.9) Q3 15/16 Q2 16/17 Q3 1
Slide 18: Vodacom: strong growth continues leveraging leading network
Vodacom: strong growth continues leveraging leading network Customer experience KPIs Financials South Africa consumer NPS (points) South Africa data bundles sold (m) Vodacom service revenue growth (%) Gap to next best South Africa Gap to third +49% Internationals 136 20 117 Group 18 18 106 7.2 6.3 4
Slide 19: Summary and Outlook
Summary • Solid commercial momentum built on NPS leadership and high network quality • Overall performance in Europe and Africa remains robust led by growth drivers – data, enterprise and fixed • India remains challenging; strategic and commercial actions underway Outlook • Continue to expect to mee
Slide 20: Q&A
Q&A 20
Slide 21: Slide 21
Slide 22: Appendix
Appendix 22
Slide 23: Customer experience and commercial KPIs
Customer experience and commercial KPIs Europe AMAP Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 15/16 15/16 16/17 16/17 16/17 15/16 15/16 16/17 16/17 16/17 4G customers (m) 28.1 33.4 36.0 39.3 41.41 4G customers (m) 6.7 13.4 16.5 19.6 23.21 Contract churn (%) 16.7% 16.1% 15.3% 15.5% 16.7%1 Contract churn (%) 20.9
Slide 24: European homes reached with NGN
European homes reached with NGN1 (millions) Wholesale NGN Own NGN 11 6 26 14 7 10 0.2 7 4 2.4 Germany Italy Spain UK Portugal VodafoneZiggo NL JV Population coverage 61% 38% 72% 88% 53% 94% 1. Excludes three million wholesale NGN homes passed in Greece and Ireland 24
Slide 25: Other key markets – Q3 16/17
Other key markets – Q3 16/17 Organic service Mobile customers (000s) Fixed broadband customers (000s) Market revenue growth (%) Net adds Closing customers Net adds Closing customers 2.2% (53) 4,778 25 518 Portugal 1.2% (473) 5,396 22 608 Greece (2%) 9 1,974 1 258 Ireland 1.4% ex. MTR 2.8% 80 8,763 1
Slide 26: Service revenue bridge
Service revenue bridge (€ millions) 12,704 178 123 31 12,300 33 (531) (69) (142) (27) Q3 15/16 FX One-off In-bundle Out of Incoming MTR Fixed line Other Q3 16/17 reported items¹ bundle and carrier reported service service revenue revenue 1. Excludes reporting change of certain dealer commissions in
Slide 27: Voice MTR impact
Voice MTR impact Q3 16/17 Q3 15/16 €m pp €m pp Europe Service revenue (23) (0.3) (21) (0.3) AMAP Service revenue (4) (0.1) (61) (1.6) Group Service revenue (27) (0.2) (82) (0.7) 27
Slide 28: FY 16/17 interim dividend under new reporting policy
FY 16/17 interim dividend under new reporting policy Dividend policy FY16/17 interim dividend YoY growth Policy +1.9% €c4.741 Intend to grow full year dividends per share in € annually Payment Average of the five business days exchange rate in the week prior to payment €/€: 1 €/£ : 1.17049 €/$: 1.07
Slide 29: Forward-looking statements
Forward-looking statements This presentation, along with any oral statements made in connection therewith, contains “forward- customer retention, reductions or changes in customer spending and increased pricing pressure; the looking statements” within the meaning of the US Private Securities Litigat
Slide 30: More information
More information Visit our website for more information 2017 upcoming dates Prelim results Q1 results AGM 16 May 21 July 28 July www.vodafone.com/investor Contact us [email protected] +44 (0) 7919 990 230 For definitions of terms please see www.vodafone.com/content/index/investors/glossary 30