first quarter 2015 · 2018-06-05 · tele2 outdoor 4g coverage, april 1 st 2015 – transfer of...
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FIRSTQUARTER 2015April 21st, 2015
Tele2 AB
Highlights from the quarter
Winning People & Culture
Value Champion
Step-Change Productivity
Focused Technology
Choices
• Transparency International Sweden ranked Tele2 number one out of the largest Sweden based companies for transparency in corporate reporting.
• 4G network in the Netherlands now at 70 percent population coverage.• Network swap project announced in Croatia.
• Data monetization continues in Sweden following launch of Tele2.0.• Substantial increase in GB data offer, driving increased ASPU.
• The Challenger Program will ramp up over the next 3 years and is expected to deliver full benefits of SEK 1 billion per annum from 2018 onwards.
2
Monetization of data continuesYear-on-year growth, Tele2 Group
Mobile end-user service revenue
Mobile EBITDA Average data usage per subscriber
+10% +10% ~40%
3
Continuous momentum in mobile end-user service revenue Year-on-year growth for mobile end-user service revenue, Tele2 Group
CAGR: 6.5%
5.7%
7.9%
6.5% 6.5%
8.7%
6.7% 6.7%
8.1%
6.6%
9.6%
Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15
4
Kazakhstan: +46%
Latvia: +7%
Lithuania: +7%
Sweden: +5%
Netherlands: +12%
Austria: +3%*
Croatia: +8%
Germany: +12%
Estonia: +7%
Market year-on-year development
* Total net sales
Mobile end-user service revenue Data growth (MNO networks)
~50%
SESE
CEE
CEEKZ
KZ
Q1 14 Q1 15
5
Tele2 Sweden
825976
27% 31%
-10%
10%
30%
50%
70%
90%
0
300
600
900
1,200
Q1 14 Q1 15
3,021 3,130
0
1,000
2,000
3,000
4,000
Q1 14 Q1 15
Net sales(SEK million)
EBITDA and EBITDA margin(SEK million)
Strong mobile YoY development
– Overall: During the quarter Tele2 Sweden launched ‘Big Buckets’ to give costumers better value and encourage further data usage. Early signs indicate a positive development in terms of ASPU and customer satisfaction.
– Consumer: We are utilizing our dual-brand strategy and early signs show good development in consideration and NPS in our target groups along with strong development in customer satisfaction..
– Business: Strong mobile revenue growth of three percent, driven by the Large Enterprise segment. New contracts were signed with Husqvarna and HiFab, and existing contracts with Kriminalvården and Volvo were expanded.
Q1 Highlights
+4% +18% +5%Mobile end-user service revenue
+20%Mobile
EBITDA
6
Increasing ASPU
Top-ups continue in our customer base… …which together with ‘Big Buckets’ continue to drive ASPU growth
>5GB: 30% 20
27
4044
38
Q114 Q214 Q314 Q414 Q115
Top-up development Tele2 Residential (Revenue, SEK million)
Postpaid TOTAL MBB TOTAL
ASPU developmentTele2 Residential Postpaid (small screen)
+15%
Intake mixTele2 Residential Postpaid (small screen)
7
Tele2 Baltics
209 231
31% 32%
0%
20%
40%
60%
80%
050
100150200250300350
Q1 14 Q1 15
671 719
0
200
400
600
800
Q1 14 Q1 15
Net sales(SEK million)
EBITDA and EBITDA margin(SEK million)
Mobile end-user service revenue (SEK million)
– Revenue decline stopped in the quarter, with strong mobile end-user service revenue development at 7 percent.
– As the first player in the market, Tele2 Latvia has launched a pan-Baltic unlimited voice and SMS tariff.
– 4G network launched in Lithuania, with a current 70 percent population coverage, complementing our existing network.
– Tele2 Estonia successfully continued the expansion into the international data carrier market with new important customer intake.
– Continued focus on aggressive LTE rollout in all countries.
Q1 Highlights
415 444 474 447 444
0100200300400500600
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15
+7%+11%+7%
8
Tele2 Netherlands
257
141
19%10%
0%10%20%30%40%50%60%
0
50
100
150
200
250
300
Q1 14 Q1 15
1,320 1,402
0250500750
1,0001,2501,500
Q1 14 Q1 15
Net sales(SEK million)
EBITDA and EBITDA margin(SEK million)
Q1 Highlights– 14th consecutive quarter of growth in the mobile customer base.
– 4G network opened on the 1st of January meeting the obligations of the 4G license. Tele2 now provides extensive coverage in the Randstad area (including Amsterdam, Rotterdam, The Hague and Utrecht).
– Commenced the transfer of customers onto our 4G network, following a thorough period of positive customer network testing.
– EBITDA was impacted by expansion, network and increased national roaming costs.
-45% +6%
Mobile customers Tele2 NL(Thousands)
680700720740760780800820840860
Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015
9
Tele2 outdoor 4G coverage, April 1st 2015
– Transfer of existing customers onto the 4G network well underway.
– Current outdoor population coverage estimated to be over 70%.
– Remain on-track for nationwide outdoor population coverage by Q1 2016.
10
Tele2 Kazakhstan
1 00% 0% 0%
100%200%300%400%500%600%700%
0Q1 14 Q1 15
294
399
0
100
200
300
400
500
Q1 14 Q1 15
– Highly competitive situation with both Tele2 and Altel offering bucket tariff plans at much lower prices than K-Cell or Beeline.
– Despite the competitiveness of the market. Tele2 has created a positive momentum – our bucket tariff plan, improved distribution and brand awareness are yielding results.
– Net intake very strong at 429,000. Positive monthly net intake trend since October 2014.
Net sales(SEK million)
EBITDA and EBITDA margin(SEK million)
Q1 Highlights
Customer development
+36%
Net intake (thousands)
% subscribers who stop using services 1 month after acquisition
10%
15%
20%
25%
30%
35%
020406080
100120140160180
Jul Aug Sep Oct Nov Dec Jan Feb Mar
2014 2015
11
Financial Overview
Financial highlights
Mobile end-user service revenue(SEK billion)
3.18
EBITDA(SEK billion) 1.43
CAPEX(SEK billion) 0.94
Net sales(SEK billion) 6.51
Q1 2015 Trend
+10%
+5%
+32%
+6%
2.90
1.36
0.71
6.15
Q1 2014
13
Mobile end-user service revenue
Tele2 Group(SEK million)
+10%
Development per market(SEK million)
3,2052,904
3,0943,252 3,205 3,184
0
1,000
2,000
3,000
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15
2,904
3,184
9329
32
9927
2,700
2,800
2,900
3,000
3,100
3,200
3,300
Q1 14 Sweden Baltics Netherlands Kazahkstan RoW Q1 15
14
EBITDA
Tele2 Group(SEK million)
1,412
1,3621,470
1,682
1,412 1,428
22.1% 23.2%25.5%
20.5%21.9%
10%12%14%16%18%20%22%24%26%28%30%32%34%36%38%40%42%44%
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15EBITDA margin
1,362
1,428
15122
-116 -1
10
1,200
1,250
1,300
1,350
1,400
1,450
1,500
1,550
1,600
Q1 14 Sweden Baltics Netherlands Kazahkstan RoW Q1 15
+5%
Development per market(SEK million)
15
CAPEX
Tele2 Group(SEK million)
Development per market(SEK million)
709
850 861
1,030938
11.5%13.4% 13.1%
15.0% 14.4%
5%7%9%11%13%15%17%19%21%23%25%27%29%
0
200
400
600
800
1,000
1,200
1,400
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15
CAPEX / Net sales
709
938
39
-23
142
53 18
500
600
700
800
900
1,000
1,100
1,200
Q1 14 Sweden Baltics Netherlands Kazahkstan RoW Q1 15
+32%
16
Free cash flowTotal operations
-555
274
475
238
-96
10%12%14%16%18%20%22%24%26%28%30%32%34%36%38%40%42%44%
-600
-400
-200
0
200
400
600
Q1 14 Q2 14 Q3 14 Q4 14 Q1 15
Tele2 Group(SEK million)
Development (SEK million)
+83%
-555
-96
36
-14410
48077
-700-600-500-400-300-200-100
0Q1 14 EBITDA Financing Taxes
Workingcapital CAPEX Q1 15
Free cash flow = Cash flow from operating activities and CAPEX paid
Q1 14 Q1 15
17
Debt position and ratioPro forma net debt / EBITDA 12 m rollingSEK billion / Ratio
6.88.3 7.9 7.9
3.3
0.0 0.0 0.0 6.6
0.000.250.500.751.001.251.501.752.00
0.0
2.5
5.0
7.5
10.0
12.5
15.0
Mar 2014 Jun 2014 Sep 2014 Dec 2014 Mar 2015
Pro forma net debt Dividend, proposed Pro forma net debt to EBITDA (inc proposed dividend Q1 15)
18
The Challenger Program
Ramp-up of indicative* costs and benefits over 4 years
Productivity improvement: 1 BSEK (5%)
*Indicative program benefits and costs. Analysis phase will identify and validate total Opex, Capex and Revenue benefits. Baseline: Forecast FY 201419
Momentum is building up
2015 20162014
We will come back to the market with more details at Q2 reporting on July 21st 2015. From then on we will report on progress quarterly until full benefits have been realized
Q2
2017 2018
Investment phase
Benefits phase
Q120
Q1 2015 Summary
21
Q1 2015 in short and key priorities moving forward
- Continued data monetization
- Getting ready for 4G launch in Netherlands and Baltics
- Executing on the Challenger Program
Winning People & Culture
Value Champion
Step-Change Productivity
Focused Technology
Choices
22
Tele2’s Way2Win
The Tele2 Way
Where we focus
We are challengers, fast-movers and will always offer our customers what they need for less
We will be champions of customer value in everything we do
Mobile access is our core business
Europe and Eurasia are our
markets
Residential and Business
How we win
Focused Technology
Choices
Value Champion
Step-Change Productivity
Winning People & Culture
Vision
Mission
23
THEEND
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