59
FY 2012 ANALYST PRESENTATION 06 February 2013
FY 2012ANALYST PRESENTATION
06 February 2013
Cautionary Statement
2
This presentation contains forward-looking statements about Mobistar, inparticular for 2013 and 2014. Although Mobistar believes these statements arebased on reasonable assumptions, these forward-looking statements are subjectto numerous risks and uncertainties, including matters not yet known to us ornot currently considered material by us, and there can be no assurance thatanticipated events will occur or that the objectives set out will actually beachieved. Important factors that could cause actual results to differ materiallyfrom the results anticipated in the forward-looking statements include, amongothers, the impact of the price adjustments on the customer base resulting fromthe competitive pressure and the economic situation in Belgium, theeffectiveness of Mobistar convergent strategy including the success and marketacceptance of the voice and date abundance plans, the Mobistar TV offers, theMobistar brand and other strategic, operating and financial initiatives, Mobistar’sability to adapt to the on-going transformation of the telecommunicationsindustry, regulatory developments and constraints and the outcome of legalproceedings, risks and uncertainties related to business activity.
3
Definitions
ARPU: Monthly average revenue per user is based on a rolling 12 months average taking into consideration total Incoming & outgoing revenues voice, SMS and MMM, visitor roaming ( excl.: MatMa, MVNO, IFRS, MBB )
AUPU: Monthly average usage per user, defined as total usage for the 12 previous months divided by the weighted average number of customers
M2M: =Machine-to-machine = MatMa. M2M´ cards are not included in the number of active customers since 2012
Mobile Multimedia: (MMM): Wireless high-speed internet access on handset devices
Mobile broadband (MBB): Wireless high-speed internet access through a portable modem / card, on tablets, netbooks, notebooks and laptops. (Internet Everywhere)
MTR: Mobile Termination Rate is the per minute charge paid by a telecommunications network operator when a customer makes a call to another mobile network operator
MNP: Mobile number portability is a service that allows a cellphone customer to change telecom carrier and keep the same phone number
NPS (Net Promoter Score): A measure of customer loyalty. It is obtained by asking customers a single question on a scale of 0 to 10 where 10 is 'extremely likely' and 0 is 'not likely at all’.
Organic cash-flow: Net cash flow from operations less acquisitions of tangible and intangible assets, plus proceeds from disposals of tangible and intangible assets and excludingspectrum license fee and acquisition of subsidiary
Operating cash-flow = EBITDA - capex.
4
Agenda
•Key Highlights
•Operating Results
•Topics in the Spotlight
•Financial Review
•Outlook 2013-2015
Werner De LaetChief Financial Officer
Jean Marc HarionChief Executive Officer
Olivier YsewijnChief Strategy Officer
Siddy JobeDirector Investor Relations & Corporate Finance
Cristina ZanchiChief Customer Experience & Loyalty Officer
Gabriel FlichyChief TechnologyOfficer
KEYHIGHLIGHTS2012 MARKET REVIEW2012 COMPANY HIGHLIGHTS4 STRATEGIC PRIORITIES 2012 GUIDANCE
A lot of things changed in 2012 in Belgium; but so far, regulation, technology and market changes have impacted mainly mobile.
6
Mobile market under pressure
MTR regulation
Roaming regulation
New Telecom Law
Open competition: 45 MVNOs
Fixed to mobile predatory tariffs
Messaging apps cannibalizing
SMS, voice
Handsets subsidies
7
2012 was intense for Mobistar too
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
SepOct
Nov DecPersonal Checkup
IP VPN offer
Full MVNO with Telenet extended
Mobistar continued to deliver on its 4 strategic priorities
MMM = Mobile multimedia on handsets 8
Animal plans reaching 43% of residential postpaid customersAnimal plans reaching 43% of residential postpaid customers
MMM attach rate on contract base increased to 77.3%MMM attach rate on contract base increased to 77.3%
Launch of Personal CheckupLaunch of Personal Checkup
Odyssey 140 M EUR gross savings since 2010 vs 100MOdyssey 140 M EUR gross savings since 2010 vs 100M
New ACE program targeting 100Mio EUR in gross savingsNew ACE program targeting 100Mio EUR in gross savings
Increased Customer satisfaction in all touch pointsIncreased Customer satisfaction in all touch points
First 4G pilots live in Antwerp and Luxembourg-City First 4G pilots live in Antwerp and Luxembourg-City
IRISNET2 network: 200km fiber, 9000 mobile cards, 122 sitesIRISNET2 network: 200km fiber, 9000 mobile cards, 122 sites
Differentiatewith services everywhere
Consolidate Leadership in
Mobile
DeliverBest in class
Customer Service
LeadIndustryEfficiency
Waiting time -25%Waiting time -25%
Mobistar reached its 2012 objectives
* FY12 EBITDA included EUR 17.5m reversal of provisions related to universal services and EUR 9.8m other income related to IRISnet 1
** Organic cash flow defined as net cash flow from operations less acquisitions of tangible and intangible assets, excluding spectrum license fee and acquisition of subsidiary. The FY12 guidance did not include the 54M€ tax payments for the 2011 corporate tax. The actual result includes the tax payment.
Total Turnover
9
EBITDA *
Capex/Service Revenue
Net profit
Organic cash flow **
2011 Actuals 2012 Guidance 2012 Results
1.658 M EUR 1.625 M EUR 1651 M EUR
530 M EUR 460 - 500 M EUR 494 M EUR *
12.2% ~12% 13%
221 M EUR 157 - 182 M EUR 186 M EUR
242 M EUR 170 - 195 M EUR 172 M EUR
OPERATIONALUPDATE
MARKET DYNAMICS
CUSTOMERS, PRICE & TRAFFIC EVOLUTION
MOBILE DATA
B2B: M2M & IRISNET
WHOLESALE BUSINESS
In a competitive & open mobile market, Mobistar continued to grow organically by 3%
11
Mobistar group turnover evolution (In Mio EUR)
11
50
1.651
+3%
FY2012Organic growth
62
210
MVNO impact*
FY 2011 excl regulatory impacts
1.600
Regulatory impact
59
-29
-30
1.658
FY 2011
MobistarOrange Lux.Mobistar + Orange Lux.
MVNO MTR and full MVNO impact*Regulation RoamingRegulation MTRhandsets
(*) At the end of June 2011still 1/3 of the customers where light MVNO customers
Mobistar FY12 net adds are positive thanks to increasing Postpaid Customer base and MVNO
12
5556
120 108
86
148
-19
118
114%117%115%114%113%112%112%
Q4 12Q3 12
-364
69
-433
Q2 12
203
55
Q1 12
71
-15
Q4 11
161
53
Q3 11
162
42
Q2 11
78
22
Q1 11
17
36
Active Penetration**Mobistar Net adds*Competition Net adds**
2228
3825
-26-18-18
-25-10
20
Q4 12
119
-28
-41
Q3 12
6813
Q2 12
55
Q1 12
20
Q4 11
53
-47
Q3 11
44
Q2 11
22
Q1 11
36
-5
55
MVNO net addsPrepaid net addsPostpaid net adds
(*) incl. MVNO customers, excl. MATMA, Internet Everywhere and OLU customers(**) Source: Mobistar estimates based on Cy announcements and Plan Bureau
(*) incl. MVNO customers, excl. MATMA, Internet Everywhere and OLU customers
Mobistar net adds split (k users)Market net adds split (k users)
and mobile penetration
• Animals segmented offers were launched in April 2012: Mobistar was first in Belgium to offer contracts without commitment
• Unlimited elements in almost all the price plans (unlimited calls or texts or access to social networks or surfing)
Due to the launch of our Animals, Mobistar was well equipped to address an even more competitive market
13
Animals43%
Old tariff plans 57%
Offer split residential postpaid December 2012 (8,5 month after launch)
Monthly Mobile Number Portability Residential Postpaid
• Animal offers enriched by adding Data & Voice in November 2012. • Introduction of ‘Personal Check-Up’ boosting future migration• Tactical handset subsidy during Christmas period
New Telecom law became effective as from August 1st, except for the 6 month contract rule, which only became effective as of October 1st
October November DecemberSeptemberAugust
Successful Launch EOY 2012 promo
Week 40 = October 1 =
OPEN
+
-
Postpaid Customer base increased in FY12 and reached 68.2% of Customer base
14
Mobistar customers (in k customers)
Q2 2011
4.009
64,3%
Q1 2011
68,1%63,9%
FY10
3.951
63,6%
3.987
FY12
4.320
68,2%
Q3 2012
4.213
Q2 2012
4.144
68%
Q1 2012
4.090
67,0%
FY11
65,0%
4.105
66,3%
Q3 2011
4.035
Postpaid as a % of total customer base
Postpaid - RES
Postpaid - BUS
Prepaid
Laptop cards
MVNO
(*) incl. Light & Full MVNO excl. OLU
Po
stpaid
Custo
mer b
ase +
8.340 subscrib
ers Y-o-Y
Mobistar revised its service-oriented distribution remuneration scheme protects us in a volatile market
Dealer remuneration based on gross adds performanceArpu profile (My series)
ARPU out of promo
ARPU in
promo
Arpu profile (Animals)
+
High Upfront, no airtime
Service oriented and ARPU related dealer remuneration
+
Lower Upfront + airtime
Customer gets promo for life
15
Excluding regulation, the mobile ARPU continued to grow thanks to increased data usage
16
)
MBB = Mobile Broadband MMM = Mobile MultimediaData usage (per unique mobile multimedia user) * Number of unique MMM user/active ending base total market (MVNO excl.) mobile offers
Q4 2012
28,7
Usage
2,4
Price
-1,7
Roaming regulation
-0,6
MTR decrease
-0,8
Q4 2011
29,5
31,3
AUPU/month (in- & outgoing traffic)ARPU/month EUR
(incl. visitor roaming)
155147
156155154146155154161
338
302321313
291
203220216207216216
0
50
100
150
200
250
300
350
10
Q4 11
9
Q3 11Q1 11
6
277
Q4 10
280
Q3 12
12
207
Q2 12
10
327
Q1 12 Q4 12
18
276
7
272
Q2 11
6
Mb per MMM userSMSMb per MBB userVoice
Mobile multimedia adoption in Belgium is accelerating. 59% of persons that can, access mobile internet
Source : Omnibus, 2009, 2010, 2011, 2012, GfK Significant 17
Mobile data revenues reached 41.4% of Mobistar mobile service revenues
Mobile data uptake (in Mio EUR)
• 2 x more tablets
• +50 % more smartphones
• Global Mobile Multimedia AUPU increased by 112% in one year time, especially in Q4
18
Enterprise Mobility 3.0 is an opportunity to take the lead on the Fixed centric players
19
M2M Leader in Belgium (70% of market share )
IRISnet 2: Next Generation Network
On May 11, 2012, Mobistar partners with the Brussels regional government for a period of 10 years
IRISnet 2 incorporated in July 2012 and operates the network as of November 2012
Mobistar manages the operation of the Next Generation Network (> 200km of fiber) for the Brussels Capital RegionMobistar was granted 2 lots
Lot 1: data transmission, fixed line telephony, added value services for 122 institutionsLot 2: voice and data mobile telephony (9000 mobile cards)
20
8 10
16
130
193
417
518
+33%+17%
13
+19%
2009 2010 2011
Mobistar B2B business continued to grow
2012 highlightsMVNO Revenues & Customers
21
(*) At the end of June 2011still 1/3 of the customers where light MVNO customers
MVNO• Light & Full MVNO Customer base increased• Total MVNO performance impacted by MTR and
Telenet shift from Light to Full MVNO
Carrier Services
Innovative Services
Wholesale business strongly supported by MVNO strategy
TOPICS IN THE SPOTLIGHTHAPPY CUSTOMERSPECTRUM & COVERAGEREGULATION
The Happy Customer vision translated into a concrete 2012 and 2013 actions
CRM and Expert
support
Proactive + Reactive
Customer rel.
Deliver Multichannel
service
Enhance Customer Service
standards
Mobistar centers
Call centers
Customer Care
Client Culturewithin
Mobistar
Service Catalogue
Customer Test center
Voice of Customer
NPS
WEB
Mobistar Customer experience promise
23
Voice of the Customer: Listen, Act, Improve
24
2012 2012
Over 50 offers/products adjustmentsimplemented in the last 6 months
2012 2012
Customer Test CenterMore than 40 processes improved
Increased First Call resolution to 93%
Mobistar enhanced its Service standards
25
Stable & Accessible Customer Care
•100 % answered
within 5 days
Written requests
Calls
Easy access
Today
•70 % answered within 20 sec.
•Call/Letter/EmaiShop/Social
Written confirmation
•Confirmation of each verbal
agreement
Call back option
•Call back option after 2.5 min for all calls
•6x faster answer
Change for Customer
•25% less waiting time
•More Customer favorite
channels
•Clear confirmation of actions taken
No long waiting times
for customers
2011
•Call/Letter/EmaiShop
•57% answered within 20 sec.
100 % answered
within 30 days
+ 13 points NPS
Social Media:increase of users & posts
95 % emails treated within 5 working days, 80% treated within 3 working days
Over 30.000 replies on social media
Mobistar is mentioned every 2 minutes and 16 seconds on the web
95% of Care related Facebook posts are treated within 30-60 min.
25% of negative posts transformed into positive posts
2012
Mobistar focused on delivering multi-channel services
26
Webcare
2012
Improved customer satisfaction
Mystart : Expert assistance to get you started with your new smartphoneBack-up: Customers data copied to new device Handset repair : shorten Turn Around Time
Mobistar Centers:new Care Services
2012
Back-upSauvegarde
ConfiguratieConfiguration
HerstellingReparation
NPS + 36 pts
Mobistar mobile network 60% swapped end 2012
2011-2012
Q1-2013
Q3-2013
Q2-2013
2G improvmentsNew radio features3G reoptimisation
Mobistar investments on radio and backhaul deliver significant 3G coverage
UMTS Indoor Coverage
UMTS Outdoor CoverageGSM Outdoor Coverage
End 2011 End 2013End 2012
Real life pilot with 500 usersa
With the 4G pilot in the city of Antwerp, Mobistar is testing instant internet in real life condition
interactive servicesALWAYS-ON
streaming servicesHD
OTT conversational services
file transfer services
lower latency and connection time
Guaranteed Bit Rate available
100 mbps / Special discounts for high
volume/low priority traffic
lower latency + more bandwidth for richer
services
TV, video, audio streaming
Web browsing, HTML5, gaming, maps, cloud &
other applications...
Upload, download (apps, emails with attachments,
etc), cloud storage ...
Videoconference, VoIP, ...
29
Initial 4G Pilot results: Customer experience highlights that 4G is as fast as fixed internet
Source : MI – 4G Antwerpen survey – n=75
Question: When you compare the speed of the 4G/LTE-network with the fixed Internet connection that you use, can you give the speed difference you have experienced when using that specific service?
In general 3 out of 4 users say that 4G is at least as fast as their fixed connection.
30
Mobistar’s spectrum portfolio is well diversified to service the increasing market demand
30
22
1800 MHz
15
2600 MHz
20
15
Auction in 4Q13)
1800 MHz*
15
15
1515
15
20
20
2100 MHz
20 45 (TDD unpaired spectrum)
22
900 MHz** 610 6 6 6 1
800 MHz
Proximus
Mobistar
Base
Current spectrum allocation (MHz duplex)
Telenet/Tecteo
Mobistar has already secured close to 2 x 70 MHz till 2015
BUCD
* As from July 2012, following a decision by the BIPT, Mobistar will be entitled to use the full allocated spectrum band in the 1800MHz (included in the 2G renewal fee )
** Telenet/Tecteo consortium has exercised its option to acquire and potentially roil-out a 4,8 MHz duplex in 900 MHz and 10 MHz duplex in 1800 MHz band as from Nov 2015 31
Spectrum – Synthesis Royal Draft Decree
Subject: The 790-862MHz band (“800MHz band”) comprises 2×30MHz of availablespectrum auction in three blocks of 2×10MHz channels.
License duration: 20 years from notification of granting
Reserve Price: 25,000 euros per MHz per month (equivalent to EUR 120m for a block of10 MHz duplex for a period of 20 years, ie EUR 0.4 per MHz per pop.
Annual spectrum usage fees: Around EUR 2.1m per annum
Payment of fee Option of paying the full fee upfront or paying an equal amount on anannual basis throughout the license duration, with an interest rate equal tothe market rate +2%
Coverage obligations Population coverage target of 33% within 2 year, 70% within 4 years and98% within 6 years
Spectrum reservation No spectrum reserved for new market entrants
32
The regulated revenue base has decreased to 29% of the mobile turnover, excluding MTR SMS to only 14%
Mobile turnover split (% of revenues)
33
Increase due to success of SMS abundance offers.
MTR and roaming revenues impacted by regulation. Decreased from 20% of mobile turnover to 14%.
Strong handsets sales in H2 2012
Regulation – MTR
EU recommendation envision 1€cent MTRs without asymmetry as of mid 2013 to its member states. Luxembourg regulator is working on market analysis & remedies. 34
Regulation – Roaming
35
Regulation – Cable Opening – Next Steps
36
Draft reference offers
published for comments in November
2012
Formal reference
offers submitted for consultation in
December 2012
5/2/2013 : End of the
consultation on the reference
offers.
+/- Q1/2013 : Expected
consultation on pricing of the cable offers
+/- Q2/2013 : Final reference offers
published
In the course of
2013 : Imple-
mentation by Cable operators
In the course of
2014 : outcome of appeal
on the merits
Current status Regulatory Calendar
FINANCIAL PERFORMANCE
Consolidated income statement
Mobistar Group shows stable total turnover but EBITDA under pressure
in Mio EUR H2 2011 FY11 H2 2012 FY12 Y-o-Y
Total Turnover 837.6 1,657.6 848.0 1,650.5 -0.4%Total Service Revenues 755.7 1,505.8 728.3 1,450.0 -3.7%Cash Expenses -604.3 -1,169.5 -633.4 -1,208.4 3.3%
EBITDA 259.5 530.1 244.4 494.1 -6.8%In % of service revenues 34.3% 35.2% 33.6% 34.1% -1.12 pt
Depreciations and amortizations -101.5 -190.3 -115.2 -217.2 14.1%
EBIT 158.0 339.7 129.2 276.9 -18.5%Net finance income -6.6 -10.9 -4.9 -10.8 -0.9%Tax expense -46.8 -107.9 -31.6 -80.5 -25.4%Net Profit 104.7 221.0 92.7 185.7 -16.0%Diluted earnings per share (in €) 1.74 3.68 1.55 3.09 -16.0%
38
Consolidated income statement
The recurrent EBITDA margin declined in 2H due to roaming regulation and increased competition
34,6%
250
H2 2011
33,6%36,1%
244
recurrent 1H 2012
727
32,7%
238
reported 1H 2012
722750
271
756
34,3%
259
recurrent 1H 2011
750
34,5%
259
reported 1H 2011
728
-9,6%-8,1%
-3,0% -3,6%
recurrent 2H 2012
32,2%
235
reported 2H 2012
728
EBITDA EBITDA/service revenues%Service revenues
+17,5 Mio EUR on reversal provision univ. serv. (EBITDA)- 3,0 Mio EUR on existing mobile contracts (rev/EBITDA)- 2,5 Mio EUR provision on fix ADSL customers (rev/EBITDA)
+17,5 Mio EUR on reversal provision univ. serv. (EBITDA)
+9,8 Mio EUR on other operating income IRISnet (EBITDA)
39
Mobistar Mobile income statement
Mobistar Fixed income statement
Mobile EBITDA impacted by regulatory & competitive pressure, Fixed EBITDA slightly improved
* Before intercompany elimination 40
in Mio EUR H1 2011 FY11 H1 2012 FY12 Y-o-Y
Total Turnover 83.0 168.3 80.3 160.3 -4.8%
Total Service Revenues 83.0 168.3 80.3 160.3 -4.8%
Cash Expenses -93.9 -192.7 -88.0 -170.0 -11.8%
EBITDA -10.9 -24.4 -7.7 -9.7 -60.2%
In % of service revenues -13.1% -14.5% -9.6% -6.1% 8.42 pt
in Mio EUR H1 2011 FY11 H1 2012 FY12 Y-o-Y
Total Turnover 712.7 1,442.7 698.7 1,445.0 0.2%
Total Service Revenues 641.5 1,288.1 615.9 1,240.0 -3.7%
Cash Expenses -435.7 -896.8 -447.2 -952.7 6.2%
EBITDA 277.0 545.9 251.6 492.3 -9.8%
In % of service revenues 43.2% 42.4% 40.8% 39.7% -2.68 pt
Orange Luxembourg income statement
Fuelled by postpaid and B2B, Orange Luxembourg delivers profitable growth
24222020
77%78%80%77%
FY 2012H1 2012FY 2011H1 2011
688179 78
PrepaidPostpaidmix Postpaid
Customers on the Orange Luxembourg network (k users)
*MATMA cards are excluded
in Mio EUR H2 2011 FY11 H2 2012 FY12 %
Total Turnover 34.1 65.7 40.1 75.5 14.9%Total Service Revenues 31.5 60.7 33.2 65.5 8.0%Cash Expenses -30.2 -57.3 -34.4 -64.0 11.8%
EBITDA 4.0 8.5 5.8 11.5 35.8%In % of service revenues 12.6% 14.0% 17.3% 17.6% 3.60 pt
EBIT -2.3 -1.9 1.8 3.6 -286.4%In % of service revenues -7.4% -3.2% 5.3% 5.5% 8.68 pt
41
Opex almost in line with last year, despite increasing headcount cost
Total cash expenses (in Mio EUR)
Orange Luxembourg increase of salaries and indexationsignificant increase of selling fees on prepaid volumes. Higher cost of handsets sold is compensated by lower communication expenses
MOBISTAR and MES:headcount cost: Quantities: + 67 FTE vs 2011, coming essentially from owned shops, in customer services (Happy Customer project) and 3,47% wage indexationnon-headcount cost mainly impacted USO reversal in JuneHandsets/RT costs mainly driven by more smartphones volume (I-Phone) Interconnection costs higher SMS traffic are compensated by MTR and roaming decrease
42
Capex were driven by further 3G and 4G pilot roll-out and commercial phasing of fix activities
Capex (in Mio EUR)Main Capex drivers
Mobistar continued to roll-out its network renewal program in H1 2012. Close to 60% of the 2012 targeted sites ( # 1650) already swapped
On its backhauling upgrade as well, Mobistar continued to invest with 2/3 of sites in IP and dual carrier activated
On IT, H1 2012 focus on new product portfolio ‘Animals’ launch , while focus in H2 2012 was on the prepaid IT platform
Device Capex in line with the slowdown in commercial activity in fix residential market
43
Taxes payable decreased in line with the corporate tax payment of EUR 54m in December
Other payables decreased with the extraordinary dividend paid in August 2012 (0,8 EUR per share)
Balance Sheet
Balance sheet remains strong
in Mio EUR H1 2011 FY11 H1 2012 FY12
Non-current assets 1,070 1,070 1,032 1,046Other Current assets 304 304 315 289Cash and cash equivalents 7 7 7 12
TOTAL ASSETS 1,382 1,382 1,354 1,347Share capital 132 132 132 132Legal reserve 13 13 13 13Retained earnings 249 249 120 213
Long-term borrowings 293 293 413 384Long-term trade payables 28 28 28 13Long-term provisions 62 62 64 67Deferred taxes 1 1 0 0
Short-term borrowings 18 18 2 23Current taxes payables 114 114 111 43Trade payables 348 348 301 345Other payables 123 123 170 115TOTAL EQUITY AND LIABILITIES 1,382 1,382 1,354 1,347Net Debt / (Net Cash) 304.5 394.0Net Debt / EBITDA 0.6x 0.8x
44
The organic cash-flow decreased to 133.2 Mio EUR impacted by the paid taxes in December
Detailed cash flow analysis
in Mio EUR H1 2011 FY11 H1 2012 FY12
EBITDA 270.6 530.1 249.7 494.1Financial result -4.4 -10.9 -5.9 -10.7Other Non cash items 6.8 4.0 4.5 14.9Change in working capital -1.2 -8.0 -14.5 -32.8Accrued Financial Interests / Expenses 0.1 0.2 -0.6 0.9Tax paid -25.2 -79.4 -66.0 -154.9
Net cash from operating activities 246.8 436.0 167.2 311.5
Purchase of intangible and tangible assets -67.1 -203.7 -62.6 -188.5Debt associated to purchase of assets -28.0 9.9 -23.1 8.0Proceeds from sale of equipment 0.0 0.0 0.0 2.2
Net cash used in investing activities -95.1 -193.8 -85.7 -178.3
Organic Cash Flow 151.7 242.2 81.5 133.2Partner financing activities 0.5 1.0 0.7 2.0Acquisition of subsidiary, net cash acquired 0.0 0.0 0.0 -3.4Flows from long-term borrowings 60.0 24.8 107.1 90.5Short-term loan subsidiaries -43.4 -14.5 -16.0 4.1Others 0.4 -1.1 0.4 1.1Free cash flow before dividend payments and capital movements 169.2 252.4 173.7 227.5
Dividend payments -173.9 -258.1 -174.3 -222.5Equity transactions costs -0.1 -0.2 0.2 0.1Available Cash Flow -4.8 -5.9 -0.4 5.1
45
SUPER MOBILEPLAN2013-2015
Regulation, technology changes and market evolution are now impacting family services too, opening a new cycle in our industry
2012 2015
After many years of continuous organic growth in a competitive market,Mobistar wants to be ready to take advantage of a new industry cycle
After many years of continuous organic growth in a competitive market,Mobistar wants to be ready to take advantage of a new industry cycle
47
Mobistar is best positioned to capitalize on new social behaviors and deliver the personal services of the future
Mobistar strong positioning
Mobility
People-centric
Simplicity
Value for money
Social behaviors evolution
People are connected anytime
People use personal devices at work
People use social networks at work
People work at home
People travel at least 1 a week
People value web more than TV
individual behaviors= mobile lifestyles
48
Boost 3G and accelerate 4GBoost 3G and accelerate 4G
Abundant offers for all segmentsAbundant offers for all segments
Best loved telco in Belgium Best loved telco in Belgium
ACE 1: cost savingsACE 1: cost savings
ACE 2: processes redesign ACE 2: processes redesign
Service at core of our channelsService at core of our channels
B2C: cloud and cable servicesB2C: cloud and cable services
Cable-regulated offersCable-regulated offers
Mobile VHBBVoice and Data
Abundance
“À la carte” vs.“All you can eat”
convergence
A new deal with Customers
(shops, web)
Your personal services anywhere with friends, @home, @work –Mobistar’ Super Mobile strategy is driven by 4 priorities:
49
Differentiatewith services everywhere
Consolidate Leadership in
Mobile
DeliverBest in class
Customer Service
Cost savingsand Processes Optimization
LeadIndustryEfficiency
49
Animals = 43% postpaid end 2012Data = 41% mobile service revenues“Unlimited” plan for every segmentShared data bundlesLow price “white label” offerDedicated support to MVNOs
Abundant offers for all segments
Consolidate Leadership in Mobile: extend mobile leadership to 4G Broadband and offer Abundance to all segments
500 4G users in Antwerp and Luxembourg end 201265% 3G indoor coverage end 201365% 3G+ indoor coverage end 201480% 4G indoor coverage end 2015150 M€ investment in 3 years for 4G+ acquisition of 800 MHz spectrum
Boost 3G and accelerate 4G
#1 in B2C postpaid customers#1 in B2C postpaid customersBest 4G network in BelgiumBest 4G network in Belgium
2015 2015
50
Mobistar B2B mobile lines: +4% YoY
Smartphones and tablets, new core of digital activity: MDM, MEAP, BYOD…:
Strategic partnerships to enable mobile connectivity of employees and machines: FeenHenry, 160 M2M partners, Mobistar Business Agents…
B2B: 3.0 mobile connectivity
Fixed as an optional commodity to access cloud and OTT services:
“A la carte” cloud services for tabletsand connected TV; OTT TV first:
B2C: cloud and cable services
-x€+
Differentiate with Services Everywhere: develop services in the cloud for B2C and B2B and prepare future regulated cable offers
#1 provider of regulated cable#1 provider of regulated cable #1 vendor of 3.0 mobile connectivity#1 vendor of 3.0 mobile connectivity
2015 2015
51
A new operating model for our Mobistar Centers:
1st telco’s website, used by 41% of our customers (3 M Unique Visitors)
Most popular telco on social medias
Service at core of our channels
“Happy Customer” focus on 1st time resolution & accessibility boost NPS: +35 in shops, + 13 in call centers
Customer Test Center to challenge customer experience of new offers
Customer loyalty reward program
Check up of customersplans every 6 months:
Handsets expertise for B2C and B2B:
Best loved telco in Belgium
Deliver Best in class Customer Service: a new deal with our Customers and a focus on service in every touch point with them
1st service channel amongst telcos1st service channel amongst telcosBest telco Customer Experience Best telco Customer Experience
2015 2015
52
Launched in Nov. 2012: in-depth analysis of our operational model1st impacts expected in 2014Initiatives covered:
Go-to-market processDistribution adaptation Review of offers portfolioAlternative network deploymentNetwork maintenance
Strategic ACE 2: processes redesign
Launched in June 2012: continuation of the 2009-2011 Odyssey program28 M€ cost savings delivered in 2012Initiatives covered:
General expensesTransmission optimizationPublishing rationalization:E-Billing and online salesCustomer care efficiency
Tactical ACE 1: cost savings
Lead Industry Efficiency: ACE* program to redesign our cost structure and revisit our core processes to prepare our future
30 M€ cost savings30 M€ cost savings
2013
-30 M€ cut on yearly cost structure-30 M€ cut on yearly cost structure
2014 - …
*ACE = Agility - Cost - Execution 53
Former 2005-2011 Dividend Policy was based upon:retained earnings important investment projects
Guidance on the consolidated net result Mobistar s.a. was used by the market as a proxy guidance for dividend flows.SuperMobile 2013-2015 programme triggers :
ambitious investmentsfair and sustainable shareholder remunerationstrong balance sheet
Cash flow based
Super Mobile aggressive investment plan implies a new sustainable dividend policy: proposed 2012 dividend is €1.80
2015The Board of Directors proposes the distribution of an ordinary
dividend of €1.80 / share to be approved by the AGM of May 2, 2013The Board of Directors proposes the distribution of an ordinary
dividend of €1.80 / share to be approved by the AGM of May 2, 2013
2012
54
Financial Outlook 2013
1651 M EUR
306 M EUR
494 M EUR
Between -4% and -6%
175 - 215 M EUR
380 - 420 M EUR
Operating cash flow **
EBITDA
Total Turnover
* FY12 EBITDA included EUR 17.5m reversal of provisions related to universal services and EUR 9.8m other income related to IRISnet
** Operating Cash Flow= EBITDA – Capex (excl. 4G spectrum cost)
55
2012Actuals
2013 Guidance
FY13 Results Calendar
DATE EVENT
29 March 2013 Annual report 2012 available on the website
22 April 2013 Financial results Q1 2013 (7:00 am) – Press release
22 April 2013 Financial results Q1 2013 - Conference call
2 May 2013 General Meeting of Shareholders (11:00 am)
23 July 2013 Financial results H1 2013 (7:00 am) – Press release
23 July 2013 Financial results H1 2013 – Conference call
21 October 2013 Financial results Q3 2013 (7:00 am) – Press release
21 October 2013 Financial results Q3 2013 - Conference call
56
FY13 Results Calendar
DATE LOCATION BROKER ROADSHOW / CONF.
12 February Paris Exane BNP Paribas Management Roadshow
5-6 March Boston / NY Nomura Management Roadshow
8 March Amsterdam Rabobank Made in Benelux TMT Conf.
12 March Brussels KBC Management Roadshow
15 March Frankfurt Deutsche Bank Management Roadshow
19 March London Citigroup Eur. & Em. Markets Telecoms Conf.
30 April London Petercam Management Roadshow
TBC Paris SGCIB European Telecom Conf
TBC Geneva Raymond James Management Roadshow
23 May Brussels Analyst & Investor Day
4-5 June NY ING Benelux Day
57
Q&A
Visit our websites:• www.mobistar.be
• http://business.mobistar.be
• http://corporate.mobistar.be
For further questions please contact IR department
Investor Relations
Siddy JobeEmail: [email protected]
http://corporate.mobistar.be/go/en/financial_information.cfm
