Hellenic Telecommunications Organization Sa · ATHEX:HTO
Hellenic Telecommunications Organization Sa — Cosmote — H1 2007 Earnings Presentation
25 slides from Hellenic Telecommunications Organization Sa's earnings presentation, August 2007
Slide 1: COSMOTE H1 2007: Driving Growth throughout S.E. Europe
COSMOTE H1 2007 Driving Growth throughout S.E. Europe August 2007 Visit our website: www.cosmote.com
Slide 2: Group Performance
Group Performance COSMOTE
Slide 3: Gaining share
Gaining share Customer Base Evolution (millions) Acquisition of + 0.87 GERMANOS COSMOTE COSMOTE Romania + 1.03 acquisition Romania, commercial launch + 1.25 GLOBUL, ROMANIA + 0.54 COSMOFON + 0.56 + 0.58 13.1 12.2 9.9 11.2 8.8 9.4 BULGARIA 4.8 8.3 FYROM FY04 FY05 Q106 Q206 Q306 Q406 Q107 Q207 Net add
Slide 4: Q2 07 Financial Highlights
Q2 07 Financial Highlights Y-o-Y 37.5% revenue growth driven by subscribers and usage in all markets and the consolidation of GERMANOS +37.5% 1,426.0 EBITDA up by 17.5% in H1 and 22% in Q2 1,037.1 +17.5% 32.5% Group Q2 EBITDA margin at 33.64% following the 38.1% GERMANOS consolidation 394.6 +1
Slide 5: Revenue breakdown
Revenue breakdown Greece AMC GLOBUL COSMOFON +7.2% +17.8% +21.3% +18.2% 41.1 99.9 15.2 406.8 436.0 34.9 82.3 12.8 Q 206 Q 207 Q 206 Q 207 Q 206 Q 207 Q 206 Q 207 ¾ Main growth drivers in all markets: subscribers and outgoing Romania voice ¾ Subscriber growth across all markets, mainly driven through
Slide 6: Greece: Steady Profitability improvement
Greece: Steady Profitability improvement EBITDA margin EBITDA margin +20 bp 41.1% 42.7% 40.5% 46.2% 42.1% 41.9% 42.1% 41.9% Q206 Q207 Q106 Q206 Q306 Q406 Q107 Q207 Operational leverage and containment of certain non revenue related cost items allows for steady profitability improvement EBITDA ma
Slide 7: Ongoing profitability improvement in all international markets
Ongoing profitability improvement in all international markets AMC GLOBUL +100 bp +400 bp +380bp -250 bp 38.0% 37.0% 61.6% 33.2% 60.1% 57.6% Q2 06 Q2 06 Q2 07 Q2 06 Q2 06 Q2 07 COSMOFON COSMOTE Romania Q2 06 Q2 07 +16.8pp - 8.0 31.3% - 18.2 14.5% +56.0% Q2 06 Q2 07 Depending of maturity of each oper
Slide 8: Resulting in significantly increasing operating cash flows
Resulting in significantly increasing operating cash flows All amounts H1-06 H1-07 YoY In million euros Group EBITDA 394.6 463.6 +17.5% CAPEX 201.3 219.1 +9% Operating Free Cash Flow 193.3 244.5 +26.5% ¾ Net debt at 2.5 billion euro, after dividend payment of 244 million euro at the end of June ¾ On
Slide 9: Regulatory Environment
Regulatory Environment ¾ Greece: Three i/c rate cuts: -17% in June 06, -11% in Jan 07, -9% in June 07 to 0.1067 Euro. June 07 cut the last step of current regulatory path. F2M revenues steadily declining as % of turnover and EBITDA. ¾ Bulgaria: Number portability to be introduced by year end; i/c ra
Slide 10: Operational & Financial Review
Operational & Financial Review
Slide 11: COSMOTE Greece
COSMOTE Greece Market Share Evolution (est.) Key Developments 40% 37% Record quarterly net additions: 254,708 35% net new subscribers 30% 35% 25% 20% 20% Capturing the highest market share of net 15% additions in the market 10% 8% 5% GERMANOS contributing all of the c.42k net new contract subs
Slide 12: COSMOTE Greece
COSMOTE Greece Y-o-Y Total voice traffic up by 26.8%, driven by outgoing traffic (+31.8%) of both post and pre paid customers +5.6% Revenues up by 7.2% in Q2 from 3.8% in Q1,overall H1 782.4 826.0 revenue growth 5.6%, despite interconnection rate decline +5.2% Core service revenue +10.5% in H1
Slide 13: COSMOTE Greece
COSMOTE Greece Revenue Mix Revenue mix evolution 3% 4% 65% 69% 2% 62% 2% 59% 21% 54% 56% 25% 8% 8% 66% 61% 31% 29% 29% 27% 25% 22% H106 H107 2002 2.003 2004 2005 2006 H I 07 Outgoing SMS & Other Services incoming revenue/total telecom revenue Incoming Wholesale Roaming Other outgoing voice revenue/t
Slide 14: AMC (Albania)
AMC (Albania) Market Share Evolution (est.) Key Developments 70% Capturing the majority of market net 60% additions, further consolidating leading 52% 50% market position 48% 40% Subscriber base up by 28.4% y-o-y, 30% 66,447 net additions in Q2 20% Q103 Q303 Q104 Q304 Q105 Q305 Q106 Q306 Q107
Slide 15: AMC
AMC Y-o-Y Revenue growth 17.9% vs H106 +17.9% 81.7 Core service revenue growth at 20.4% compared to 69.3 62.0% H1 06 58.3% +25.4% 50.6 40.4 EBITDA up by 25.4% in H1 and 26% in Q2 21.7 25.9 EBITDA margin at 62% in H1, despite strong subscriber additions and new commercial policies H106 H107
Slide 16: GLOBUL (Bulgaria)
GLOBUL (Bulgaria) Market Share Evolution (est.) Key Developments 70% Market share consolidation at over 40% 60% 51% 50% Capturing the majority of market net 40% 40% additions 30% Q2 net adds of 171,310 subscribers of 20% which c. 63% post paid 9% 10% 0% Significant customer mix improvement Q
Slide 17: GLOBUL
GLOBUL Y-o-Y c. 70% increase in traffic, driven by post paid +22.5% 191.3 customers 156.2 22.5% revenue growth y-o-y driven by subscriber & usage growth, especially by post paid customers +26.7% 38.4% 37.1% 73.4 Core service revenue growth by 24.2% compared to 57.9 24.2 H1 06 15.2 H106 H107
Slide 18: COSMOFON (FYROM)
COSMOFON (FYROM) Market Share Evolution (est.) Key Developments 80% Total customer base up by 19.2% y-o-y 70% 60% 66% 50% Q1 trends continue: Over 50% of new 40% 34% additions are post paid subscribers in 30% Q2 20% 10% Significant customer mix improvement Q205 Q305 Q405 Q106 Q206 Q306 Q406 Q1
Slide 19: COSMOFON
COSMOFON Y-o-Y Substantial increase in traffic, up by 86.5% yoy, +23.1% 29.2 driven by both postpaid and prepaid customers 23.7 28.0% Revenues up by 23.1% for H1, driven by usage 13.7% 8.2 trends and new subscribers 3.2 -1.8 -5.2 Outgoing voice revenues for H1 up by 34.4% H106 H107 y-o-y Q-o-Q
Slide 20: COSMOTE Romania
COSMOTE Romania Market Share Evolution (est.) Key Developments 50% Capturing majority of market net additions for 44% the quarter 40% 42% 30% Reaching over 11% market share 20% 11% 10% 2.22 million customers at the end of Q2 07, 3% 0% despite re-assessment of pre paid customer Q405 Q106 Q206 Q
Slide 21: COSMOTE Romania
COSMOTE Romania Income Statement Revenues steadily increasing H1-06 H1-07 Revenues 14.0 63.6 Customer base expansion starting to pay EBITDA -30.5 -18.6 back: EBITDA loss contained at 8 million Depreciation -11.8 -19.0 Euro in Q2 Financial expenses (net) -2.5 +16.9 Net income/loss -44.9 -20.7 C
Slide 22: GERMANOS
GERMANOS Income Statement Subscriber acquisition capabilities remain unaltered despite change in business model Contributing over 500k net adds to the All amounts Q2 07 H1-07 In million euros Group in Q2 07 from just over 200k in Q2 06 Revenues 223.1 427.6 Germanos accounts for c. 63% of Group
Slide 23: Group Outlook
Group Outlook COSMOTE
Slide 24: Group Outlook
Group Outlook ¾ On course to reach targets with key drivers being subscriber and traffic enhancement in all markets: 9 over 30% sales growth 9 over 15% EBITDA growth 9 over 15% net income growth 9 Capex at c. 450 m Euro 9 COSMOTE Romania on track to become EBITDA positive in 2008 9 GERMANOS deliveri
Slide 25: Note on Forward-Looking Statements
NOTE ON FORWARD-LOOKING STATEMENTS Some of the statements in this document are "forward-looking statements". Forward-looking statements are derived from information that we currently have and assumptions that we make. Words such as "believes", "anticipates", "expects", “targets”, intends","seeks", "