2007 first half results - vivendi€¦ · customer base: 1.28 million lines / -2% vs june 2006 ......

2007 First halfResults

PresentationAugust 2, 2007

1

August 2007

First half highlights

Business review

Financial results

Outlook

2

August 2007

Maroc Telecom consolidates its leadership despite the competition intensification

Mobile :Customer base: 11.7 million customers / +31% vs June 2006Market share(*): 66.4%

Internet :Customer base: 444 k lines / +34% vs June 200640% of fixed lines(**)

Market share(*): 93%

Fixe :Customer base: 1.28 million lines / -2% vs June 2006 Market share(*) (excl. limited mobility): 99.7%

(incl. Limited mobility) : 66.0%

(*) Source ANRT at June 30, 2007 (**) excluding public telephony and limited mobility

OutlookBusiness review Financial resultsHighlights

3

August 2007

A succesfull international development

Africa: leading operators in their marketsMauritel since 2001Acquisition of a 51% Onatel stake in Burkina Faso: December 2006Acquisition of a 51% Gabon Telecom stake: February 2007Maroc Telecom continues to prospect other opportunities in the region

Europe : communitarian linksLaunch of Mobisud (MVNO)

In France on 01/12/2006In Belgium on 02/05/2007

MVNO projects in other European countries (Spain, Italy, Netherland, Maghreb)Points of presence to catch international traffic


4

August 2007

More than 15 million of customers

Maroc Telecom Group

Morocco

Mobile11, 7

66,4% leader57,8%

Fixed1,3

100% leader4,3%

Internet0,4

98% leader39%*

•Customer (m)•Market share•Penetration

Mauritanie

• Customer (k)• Market share• Penetration

Mobile767

70% leader33.6%

Fixed36

100% leader1.1%

Internet5

100% leader14%*

Burkina Faso


Mobile463

36% / 2nd

7.5%

Fixed107

100% leader0.7%

Internet8

100% leader7%*

Gabon


Mobile263

32% / 2nd

54.4%

Fixed22

100% leader2.6%

Internet1

100% leader5%*

(*) compared to fixed-linesCustomers, market share and penetration in Morocco at June-end 2007 / Customers, market share and penetration other countries at Dec-end 2006 (source ITU, MTC, Mauritel)

France – Belgium (MVNO)

Mobile41 Customer (k)


5

August 2007

First half results: encouraging trend

Revenues 13,007 MADm / +19.5% +10.1% on comparable basis

Operating income 5,999 MADm / +33.6%+34.5% on comparable basis

Operating margin: 46.1% / +8.1 points on comparable basis

Net income group share 3,850 MADm / +28.4%Net margin: 29.6% / +2.1 points

Cash Flow – Activity 5,442 MADm / +24.1%


6

August 2007


Business review

Financial results

Outlook

7

August 2007

Mobile in Morocco: highlights

New abundance offers to increase usage

Launch of many new offers : mobile email, push-to-talk, Blackberry services, Internet broadband using 3G…

Mobisud: development of a community offer

Decrease of access charges

Intensification and diversification of promotions

MobileOutlookBusiness review Financial resultsHighlights

8

August 2007

Mobile in Morocco: Growth and leadership

(*) Source : ANRT (**) including Forfaits sans engagement

Market growth remains strong

Maroc Telecom strengthens its prepaid market share and increases its postpaidmarket share (+5.6 pts)

Churn increase with customer base growth and access charges decrease


Customers, '000 30/06/2006 31/12/2006 30/06/2007 Var yoy

Customer base 8,924 10,707 11,713 31.3%Postpaid** 371 410 463 31.5%Prepaid 8,553 10,297 11,250 24.8%

Market share* 67.4% 66.9% 66.4% -1.0 ptsPostpaid** 56.1% 59.4% 61.7% 5.6 ptsPrepaid 68.0% 67.2% 66.6% -1.4 ptsNet adds 80.6% 68.4% 61.6% -14.0 pts

Churn 16.6% 20.3% 23.9% 7.3 ptsPostpaid 13.1% 13.4% 12.8% -0.3 ptsPrepaid 16.7% 20.5% 24.2% 7.5 pts

9

August 2007

694

93 117

706

89 113

716

83 107

Postpaid* Prepaid** Blended

H1-06

H1-07

FY-06

Mobile in Morocco: ARPU and usage

Slowdown of ARPU decrease, with the customer base growth: -8.5% in H1-07 vs -10% in 2006

Usage increase, mainly postpaid, with unlimited offersand aggressive promotions on scratch cards

Outgoing Usage(Minutes/ustomer/month)

ARPU (MAD/customer/month)

462

2139

508

2140

642

2954

Postpaid* Prepaid** Blended


(*) Including Forfaits sans engagements (**)Active customer base

10

August 2007

Mobile subsidiaries: huge growth of customer bases

The global customer base of African subsidiaries reached nearly 1.5 million customers, up 40% yoy.

(*) customer base at December end 2006

+48%

+50%

+9%

Mauritel Mobiles

Onatel / Telmob

Gabon / Libertis

Mobile customer base (thousand)


518767

309

463

263

241*

June 06 June 07

11

August 2007

Mobile revenues structure and margins

A strong revenues growth coming from a robust customer base increase

Enhanced margins by more than 7 points due to acquisition costs control and new subsidiaries margins enhancement

(*) reassessment of international interconnection revenues (**) at constant currency rate


en MADm - IFRS H1-2007Published Comparable basis

Gross revenues 7,079 7,487 8,888 19.0%

Maroc Telecom* 6,746 6,746 7,900 17.1%Mauritel Mobiles 333 333 420 35.1%

Onatel (Telmob) - 255 328 26.6%

Gabon Telecom (Libertis) - 153 223 43.5%

Mobisud (France + Belgique) - 17 -

Operating income* 3,228 3,307 4,588 39.1%

% of revenues 46.0% 44.2% 51.6% 7.4 pts

H1-2006 %change comparable basis**

12

August 2007

Fixed-line & Internet in Morocco : highlights

New products:New ‘Phony’ unlimited tariff plan

ADSL+ Launch delivering a broadband up to 20 Mo

IPTV : new 60 channels offer

New prices cuts: ADSL : from 17% to 33% depending on speed

International leased lines: -15%

‘Téléboutiques’

‘Atlas Offshore’ underwater cable to be laid between Morocco (Asilah) and France (Marseille)

Fixed & Internet


13

August 2007

Fixed-line in Morocco : customer base consolidation

(*) Source : ANRT, excl. Limited mobility

Growth of the residential customer base since Q4-2006 with new unlimited offers

Consolidation of Maroc Telecom position in the corporate segment

Fixed & Internet


lines '000 30/06/2006 31/12/2006 30/06/2007 Var yoy

Maroc Telecom number of lines 1,310 1,266 1,280 -2.3%

Residential 850 813 820 -3.5%

Corporate 299 296 301 0.7%

Public telephony 161 157 159 -1.2%

Penetration rate* 4.4% 4.2% 4.2% -0.2 pt

14

August 2007

Internet in Morocco: ADSL still soaring

ADSL growth by nearly 35% in an annual basis

Internet customer base(thousand)

Broadband

Narrowband

7 7 6

325384

438

10

242

Dec-05 June-06 Dec-06 June-07

252

332

391444

Fixed & Internet


15

August 2007

Fixed subsidiaries: weak growth except in Burkina

The total customer base of subsidiaries in Africa reached nearly 165,000

Growth only in Burkina Faso

36 36

96 107

2222*

juin 06 juin 07

-

+11.4%

-

Mauritel SA

Onatel

Gabon Telecom

Fixed customer base (thousand)

Fixed & Internet


(*) customer base at December end 2006

16

August 2007

Fixed and Internet revenues structure and margins

Morocco: Impact of LL tariff cut and of international interconnectionrevenues reassessment Mauritania: Negative impact of the exchange rate (-7%)Burkina Faso : growth in correlation with customer base increaseGabon : customer base reliability still going

Fixed & Internet


en MADm - IFRS H1-2007Published Comparable basis

Gross revenues 5,077 5,698 5,532 -2.9%

Maroc Telecom* 4,918 4,918 4,727 -3.9%Mauritel 159 159 165 11.0%

Onatel - 363 410 10.8%

Gabon Télécom - 258 230 -12.2%

Operating income* 1,263 1,165 1,411 21.2%

% of revenues 25% 20% 26% 5 pts

H1-2006 %change comparable basis**


17

August 2007


Business review

Financial results

Outlook

18

August 2007

Scope of consolidation and other features

Change in the scope of consolidation:Fully consolidation of :

Onatel: since 1/1/ 2007Gabon Telecom : since 1/3/2007Mobisud Belgique : since 1/4/2007

Other elements:Release of the unused part of the provision for the voluntary redundancy plan: 100 MADm


19

August 2007

Growing revenues

5,077

7,079

10,888

H1-2006

-2.9%5,532Fixed and Internet (gross)*

19.0%8,888Mobile (gross)*

10.1%13,007Consolidated revenues

Var. comparable basis**H1-2007MADm – IFRS

Double-digit growth of Mobile revenues with the customer base increase, despite a 8.5% ARPU decrease in Morocco

Slight decrease of Fixed and Internet revenues, with the negative impacts of international interconnection revenues reassessment and LL tariff cut

Subsidiaries contribution reached 12.5% of Group gross revenues



20

August 2007

45.6%51.6%

41.2%46.1%

24.9% 25.5%

S1-06 S1-07

Mobile

Consolidated

Fixed &Internet

Margins stand at a high level

1,262

3,228

4,491

H1-06

21.2%1,411Fixed and Internet *

39.1%4,588Mobile *

34.5%5,999Operating income

Var. comparable

basis**H1-07MADm – IFRS

The consolidated margin remains very high, and positive effect in H1-2007of the voluntary redundancy plan

Excluding effects of the voluntary redundancy plan:The operating income is up 23.6% on a comparable basisThe operating margin reached 45.1%, up 1.3 pt

The enhancement of Mobile margins is the result of the costs acquisition control, in a context of the customer base huge growth

Subsidiaries contribution reached 4% of Group operating income

Operating margins



21

August 2007

17.3%

13.9% 13.6%

9.1%

13.0%

12.0%

H1-06 H1-07

Fixed &Internet

Consolidated

Mobile

Growing capex

661

851

1,512

H1-06

45.1%959Fixed and Internet

39.1%1,184Mobile

41.7%2,143Capex

% Var.H1-07MADm - IFRS

Maroc Telecom continues to highly invest in Morocco, capex represent13% of revenues

The growth of Fixed capex is partly linked to the sub-marine cable (240 MADm)

In H1-2007, subsidiaries contribution represents 23% of Group capex

Capex/Revenues


22

August 2007

A net cash position of MAD -2.7 billion

The net cash position is negative with:the distribution of 100% of 2006 income, i.e. MAD 6.9 billionthe capex growthrecent acquisitions

Utilisation of a small part of the MAD 4 billion overdraft facilities to face needs


Value %

Cash flow – Activity 4,385 5,442 1,057 24.1%

Cash flow – Investment -1,518 -2,322 -804 53.0%o/w: Capex -1,512 -2,143 -631 41.7%

Acquisition -10 -334 -324 ns

Cash flow – Financing -9,636 -2,961 6,675 nso/w: Dividends -6143 -6950 -807 13.2%

Share capital reduction -3516 - - ns

Change in borrowings -35 3968 4,003 ns

Cash position at the end of period 804 2,741 1,937 262.0%

Financial debt -82 -5,498 -5,416 ns

Net cash position 722 -2,757 -3,479 ns

MADm - IFRS H1-06 H1-07Variation

23

August 2007


Business review

Financial results

Outlook

24

August 2007

Perspectives

Morocco, a growing country

Favourable economic data…2007 forecats > 4% (excl. agriculture)

Inflation under control < 3%

Decrease of unemployment rate: 10%

…supported by ambitious projects…

Infrastructure, Offshoring, Tourism…Partly financed by foreign investors

Africa, a high potential

Promising economic forecasts :More than 5.5%/year within the next three years (source : World bank)

A Mobile penetration to grow rapidly :Less than 4% in Sub-Saharan Africa in 2006 (source : ITU)

A field of growth and profitability with :Synergies to be implementedAnd management methods to be enhanced


25

August 2007

Outlooks for 2007 end

Within the same scope,

taking into account new acquisitions:

Consolidated revenues growth will exceed 16%

(will exceed 8% on a comparable basis)

Consolidated operating income will exceed 18%

(will exceed 20% on a comparable basis)


26

August 2007

Disclaimer

This presentation contains forward-looking statements regarding Maroc Telecom. This information cannot be considered

as historical data and reflects management’s opinions on the expected impact on earnings of its strategy as well as its

forecasts related to new or existing programmes, technological developments or market conditions.

Although Maroc Telecom believes that its expectations are based on reasonable assumptions, these statements are

subject to risks and uncertainties that could cause actual results to differ. It can give no assurance that these expectations

will be achieved or that the actual results will be as set out herein. Key factors that could cause differences between the

expected and actual results include strategic, financial and operational initiatives by Maroc Telecom, changes in the

competitive environment, regulatory changes in the telecom market, and risks and uncertainties linked to currency

fluctuations, technological trends, economic activity and international operations.

The forward-looking statements contained in this document are based on opinions valid at the date of the report only.

2007 first half results - vivendi€¦ · customer base: 1.28 million lines / -2% vs june 2006 ......

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