TIM Brasil FY2012 Recap & Plan Outline

Transcription

1 Outline February 8th, 2013 TIM Brasil FY2012 Recap & Outline

2 Safe Harbour These presentations contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of These statements appear in a number of places in this presentation and include statements regarding the intent, belief or current expectations of the customer base, estimates regarding future growth in the different business lines and the global business, market share, financial results and other aspects of the activities and situation relating to the Company and the Group. Such forward looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ materially from those projected or implied in the forward looking statements as a result of various factors. Forward-looking information is based on certain key assumptions which we believe to be reasonable as of the date hereof, but forward looking information by its nature involves risks and uncertainties, which are outside our control, and could significantly affect expected results. Analysts are cautioned not to place undue reliance on those forward looking statements, which speak only as of the date of this presentation. Telecom Italia S.p.A. undertakes no obligation to release publicly the results of any revisions to these forward looking statements which may be made to reflect events and circumstances after the date of this presentation, including, without limitation, changes in Telecom Italia S.p.A. business or acquisition strategy or planned capital expenditures or to reflect the occurrence of unanticipated events. Analysts and investors are encouraged to consult the Company's Annual Report on Form 20-F as well as periodic filings made on Form 6-K, which are on file with the United States Securities and Exchange Commission. 1

3 Agenda 2012 Result Overview Outline 2

4 Business Resilience Against a Strong Headwind Users, Minutes, Unique Users, %YoY % Operational Improvement +14% ~18 +22% ~21 Leader in customer base growth for the 10th consecutive quarter Leader in prepaid #2 in postpaid voice (ex - M2M and Dongles) 4Q11 1Q12 2Q12 3Q12 4Q12 Customer Base Mln 4Q11 1Q12 2Q12 3Q12 4Q12 Minutes of Usage 4Q11 1Q12 2Q12 3Q12 4Q12 Data Monthly Unique Users - Mln Record of MoU at 150 min R$ Bln, %YoY Total Revenues 19% % YoY 7% 8% 7% 13% Financials Organic EBITDA 6% 7% 8% Organic Net Income 27% 34% -2% 16% Smartphone penetration reached 43% of total base Increasing investment to R$3.4 bln (+12% YoY) ex-licenses Q12 2Q12 3Q12 4Q Q12 2Q12 3Q12 4Q Q12 2Q12 3Q12 4Q12 Organic Net Income FY12 = R$1.5 Bln (+17.4% YoY) EBITDA Capex = R$1.6 bln (ex-licenses) % Margin Proposed dividends of ~R$743 mln (+39% YoY) 3

5 Agenda 2012 Result Overview Outline 4

6 Leveraging on Pure Mobile Approach Voice FMS: Mobile cheaper than Fixed Data Going Mobile R$/minute, voice Mln Households Possess Internet connection 68 Mln 38% 25.7 Mln Fixed BB by speed % of connections < 2 Mbps 66% 50% mobile discount Does NOT Possess Internet connection 62% 41.9 Mln 28% Intention to buy over next 12 months 27% 3.2 Mln 25% 2.9 Mln 48% 5.6 Mln Other Lack of Coverage Too Expensive Total Households Households which does NOT possess Voice FMS: TIM, less exposed Data Going Mobile greater price efficiency R$ billion, Net Revenue per Group (9M12) Willingness to pay, % of households Willingness to pay (% of Households) Total Fixed + Data + Pay TV 9.4 Mobile 15.6 Source: Company estimates; CETIC dec FMS Focus Vivo Claro Oi TIM GVT > R$ 250 1% UBB R$ 250 2% R$ 200 3% R$ 150 6% Live TIM R$ % Approach R$ 80 20% R$ 70 26% R$ 50 41% R$ 40 50% R$ 30 62% R$ 20 68% Mobile R$ 10 73% A pure mobile approach is the most suitable strategy to capture both opportunities 5

7 % 20% 15% 10% 5% 0% TELECOM ITALIA CONFERENCE CALL Business Drivers of Growth CAGR Ways of Growth Revenue Growth (Total Revenues,R$ billion) High Single Digit growth Customer Base MoU VAS Revenues >90 Mln >200 min >26% HH ready to sell ~2Mln Community Expansion FMS (Voice) Internet for everybody Tim Fiber Ultra BB e Million of lines Mobile Customer Base FMS Voice (MOU) Minutes of usage per line Internet for All (Mobile Data) Data as % of Gross Mobile Serv. Revs. >200 >26% > Double digit growth 13% 15% 19% Double digit growth e e e 6

8 TIM Fiber: for 2013/2015 Coverage (addressable) Thousands of Households 4x ~ Efficient approach > Geographic Expansion Geographic expansion for low-middle class and targeting high income neighborhood 2012: priority coverage in areas with high A/B classes concentration MSAN port occupancy (%), Capex (R$) Port Occupancy (%) Coverage Capex per Home Passed ~R$2k Installation Capex per Sub ~R$800 Total Capex per Sub ~R$5k 2013: chess board strategy and entering in class C 2014: additional coverage in Rio de Janeiro and São Paulo metropolitan regions, focusing class C concentration areas ~R$300 ~R$80 ~R$700 TIM Fiber Int. Bench.* TIM Fiber Int. Bench.* TIM Fiber Int. Bench.* 7

9 Network and Quality Approach 3G Coverage : Network Development Internet for All (Mobile Data) (# Cities, % Urban Population Coverage) % Urban Pop Coverage 72% 66% 54% 80% (Units TRX, Km Fiber) TRX (000) : Quality Targets SMP5 Call Completion 97% 95% 95% 95% 712 # cities e Data Channel Elements (000) SMP7 Drop Call 1.7% 2.0% 2.0% 2.0% Organic Capex (ex- 4G license) (Capex/Sales, Mix of Investments) As % of Net Revs. Infra Invesṭ 18.0% 18.0% 19.6% FTTS (Km 000) FTTS (#Sites 000) SMP8 Data Connection Rate 99% 98% 98% 95% SMP9 Data Connection Drop Rate 3% 5% 5% 5% Other Invest e 8

10 TIM Brasil Guidance R$ billion CAGR Guidance Total Net Revenues High Single Digit Growth Organic EBITDA High Single Digit Growth Organic Capex