Telefónica s Profile 4Q Telefónica S.A. February 2015

Transcription

1 Telefónica s Profile 4Q 2014 Telefónica S.A. February 2015

2 Telefónica is the result of 90 years of anticipation and transformation CTNE is set up in Madrid; ITT is one of its initial shareholders (1924) The Spanish government takes 79.6% of CTNE shares (1945) Installs the phone 1 million (1953) CTNE becomes the #1 Spanish enterprise (1960) Start of satellite communications (1967) Begins operations of the 1st European Data Transmission Special Network (1971) Installs the phone number 10 million (1978) Lists on New York Stock Exchange (1987) Enters in Chile (CTC) and in Argentina (TASA) (1990) Launches MoviLine in Spain (1990), the analogue mobile service, reaching a geographic coverage of 98% in three years. Enters in Peru (TdP) (1994) Launches digital mobile telephony: Movistar (1994) Commercial Internet is being born. Telefónica launches Infovía (1995) Wins the tender for Telesp in Brazil (1998) Telefónica becomes fully public again (1999) Launches fixed broadband access service ADSL (1999) 2

3 ...especially during the last decade Veronica Operation: Telefónica de Argentina; Telefónica del Perú; Telesp and Tele Sudeste in Brazil (2000) Joint venture of Telefónica and Portugal Telecom in Brazil: Vivo (2003) Launches Imagenio (2003) Acquisition of BellSouth's assets in Latin America (2004) Acquisition of Cesky Telecom (2005) Takes a 5% stake in China Netcom (2005) Acquisition of the O2 assets in the UK, Germany and Ireland (2006) Mobile license awarded in Slovakia (2006) 51% stake taken in Colombia Telecom (2006) Industrial alliance with Telecom Italia (10.47% of the voting rights) (2007) Acquisition of Telemig by Vivo in Brazil (2008) Reaches a 5.38% participation in China Unicom after the CU- CNC merger (2008) Strengthening of the strategic alliance with China Unicom (2009) Acquisition of Hansenet in Germany, Jajah in Israel and Tuenti in Spain (2010) Control of Vivo obtained by buying PT stake out of Brasilcel (2010) Mobile license awarded in Costa Rica (2011) T.Digital and TGR creation (2011) Sale of 4.56% stake in China Unicom (2012) IPO Telefónica Deutschland (2012) Sale of Atento (2012) Sale of 40% of Telefónica s stake in Centroamérica (2013) Sale of Telefónica Czech Republic (2014) New totally customer-centred organization (2014) Acquisition of E-Plus in Germany (2014) Sale of Telefónica Ireland (2014) Acquisition of DTS (Canal+) in Spain (2014) 1 Acquisition of GVT (2014) 1 Sale of Telecom Italia s stake (2014) Sale of 2.5% stake in China Unicom (2012) 2 Sale of Telefónica O2 UK (2015) 1 1. Operation is subject to obtaining the relevant regulatory approval. 2. The stake in China Unicom has been reduced to 2.51%. 3

4 Since the beginning of internationalization, the company has experienced a significant growth Customers (Mn) x28 Countries Team ( 000 employees) x1.7 Revenues (Mn ) 4,273 50,377 x12 4

5 Telefónica is a reference in the Latin American Telco market and has a relevant scale in Europe Accesses: Mn December 2014 Accesses: Mn December 2014 Brazil: 95.6 Spain: 41.2 Argentina: 26.6 Mexico: 23.2 Germany: 47.7 United Kingdom: 24.7 Peru: 22.0 Colombia: 15.7 Chile: 13.9 Central America : 11.9 Venezuela: 11.4 Ecuador: 5.1 Uruguay: 1.9 5

6 Remarkable growth in mobile broadband and TV Total Accesses: 341 millions Acceses (Organic Variation) +2.5% +2.0% Pay TV 5.1 Others 7.0 Fixed Telephone 36.8 Fixed Broadband 17.7 Dec'2013 Dec'2014 ARPU (Organic Variation) +0.3% -1.5% Dec'2013 Dec'2014 Digital Revenues (Organic Variation) Mobile Accesses % +29% Nota: T. Czech Republic has been removed from the consolidation perimeter since 1 January 2014 T. Ireland has been removed from the consolidation perimeter since 1 July eplus has been included in the consolidation perimeter since 1 October Dec'2013 Dec'2014 6

7 Telefónica in figures 12 M 2014 (EUR Mn) % Var. Reported vs 12M 2013 % Var. Organic 1 vs 12M 2013 Revenues 50, (11.7) OIBDA 15, (18.7) OIBDA Margin 30.8% (0.8 p.p.) (2.6 p.p.) Operating Free Cash Flow 2 6,067 (12.7) (37.3) Growth (Organic variation) +0.7% -0.4% +0.0% +2.6% +0.2% Revenues OIBDA -0.8% Organic growth: assumes constant 2013 exchange rates (average FX in 2013), excludes Venezuela in both years and considers a constant perimeter of consolidation. OIBDA level guidance excludes writeoffs, capital gains/losses from the sale of companies, tower sales and material non-recurring impacts such as restructurings, etc. 2. Operating CF = OIBDA - CapEx (excluding spectrum). 7

8 Strong diversification % out of market of origin Accesses Revenues OIBDA * 95.6% 85.1% 89.0% 87.9% 76.1% 63.4% 74.5% 68.5% 56.4% 70.9% 51.1% 41.4% 62.8% 64.5% 49.9% 55.1% 29.1% 20.4% Operational data as of December 2014 and financial data as of January- December Vodafone: Financial data as of March-September Revenues data calculated with Service Revenue 8

9 #6 by total accesses Top 10 Worldwide by total acceses (Millions, December 2014) China Mobile Vodafone China Unicom China Telecom América Móvil Bharti Airtel Axiata France Telecom Deutsche Telekom Total accesses (as reported by companies) = Fixed Lines + Mobile Customers + Narrowband and Broadband Internet + Pay TV. 9

10 #1 European Telco in R&D Worldwide Telco sector ranking by R&D (EUR million) NTT at&t TI BT Orange Vodafone SK Telekom KT DT Source: The 2014 EU Industrial R&D Scoreboard (European Commission) 10

11 Among Top 10 in the Telco sector by market cap. Worldwide Telco sector ranking by Market Capitalization (EUR million) China Mobile 248,419 Verizon at&t 160, ,551 Vodafone Deutsche Telekom NTT DoCoMo Softbank Corp América Móvil 82,047 75,608 69,180 65,985 64,844 64,712 Source: Bloomberg 28/02/2015 NTT 62,920 11

12 #1 telco by shareholder s return Total Shareholder s Return ( ) 120% 93% 77% 49% 37% 20% -16% -48% -57% -63% Verizon Vodafone Dow Jones Telco at&t British Telecom Deutsche Telekom France Telecom KPN Telecom Italia TSR: capital gain (share price at end of period - share price at beginning of period ) plus dividends over beginning share price Source: Bloomberg Period: 28/02/ /02/

13 Telefónica s activity has a clear positive impact in the societies where it is present As an engine for economic sustainable development and innovation......and to help overcome social divides

14 The ICT sector is key to improve productivity and for economic sustainable growth ICT impact on the economy Increase in GDP growth (pp) per each 10 pp increase in penetration of Telco services , , , , ,5 Broadband development Fixed Infrastructure Investment Direct Benefits Mobile Narrowband Enterprise penetration Household Penetration Broadband Total Factor Productivity Private Income Developed countries Developed countries Contribution to GDP growth Consumer surplus Source: World Bank; Qiang. 14

15 Telefónica s activity contributes to economic development in the countries where it operates... Broadband increases productivity 5% in industrial sector and 10% in service sector due to process improvement Digital Agenda implementation for Europe Impact on jobs Jobs (Mn) Short Term 1.2 Long Term CapEx incl. spectrum 8, % Telefónica CapEx EUR Million CapEx (non spectrum)/revenues 8,928 8, % 8, % 14.3% CapEx 8, % ,844 10,224 9,458 9,395 9, CPI Evolution versus CPI Communications EU (Base 100 = 2005) Source: Eurostat General CPI Communications CPI 15

16 ...with a clear commitment with open innovation and entrepreneurship MARKET ACCESS Fund in process of creation Network VC funds Corporate Fund Start-up accelerator Grants programme ~30,000 analyzed projects Accelerated more than 400 start-ups worldwide 14 Wayra academies worldwide Social entrepreneurship programme Crowdworking spaces Crowdworking Spaces 16

17 Telefónica also promotes social cohesion through the development of social programs Education and learning Art and digital culture Corporate Volunteering In ten years we have assisted 471,848 children and teenagers and we have trained 1,932 people at NGOs to address these issues. During 2013, we trained 7,986 teachers through the Aulas Fundación Telefónica (AFT) -Telefonica Foundation Classrooms- and 14,537 teachers received extensive training in educational innovation (not AFT). In 2013, there were 26,614 active volunteers from Telefónica with a total of 195,906 hours of dedication. Presence of Fundación Telefónica in the world 12 COUNTRIES Countries where Fundación Telefónica collaborates 8 COUNTRIES 17

18 Different organizations have recognized our commitment with corporate sustainability Telefónica in the top 5 sector Carbon Disclosure Project: Signed by 551 institutional investors, with assets of US$71 trillion. CDP Global 500 Report examines the carbon reduction activities at the world s largest public corporations Included in FTSE4Good Index, an index that measure the performance of companies that meet globally recognized corporate responsibility standards Member of DJSI Europe Best practice in labor and human rights indicators The most admired Telco in Europe, and the second worldwide, according to the World s Most Admired Companies Ranking in

19 Our brands, one of our main assets, are managed globally Brand Architecture Institutional Role Speaks to: Institutions Governments Employees Multinational Clients,... Commercial Role Speaks to Customers and Society 19

20 In conclusion Telefónica is today a success story in the industry as a result of our unique profile, both by scale and diversity Telefónica has a clear vision to become a Digital Telco and to capture all the opportunities of the Digital Revolution Economy s competitiveness and productivity improvement will necessary come through the intensive use of ICTs 20

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