2008 Financial Results. Presentation to analysts February 24, 2009

Transcription

1 2008 Financial Results Presentation to analysts February 24, 2009

2 Highlights Business review Financial results Outlook 1 February 2009

3 Highlights A more challenging domestic environment Moroccan economic fundamentals remain sound GDP growth estimated at 5.8% in 2008, despite the global economic slowdown But signs of inflationary pressures: core CPI inflation rose 3.9% in 2008 whereas food prices rose 6.8% Heightened competition Competitors launch heavily subsidized offerings: Limited mobility, Prepaid wireless Internet, pricing promotions, etc. Third operator enters 3G mobiles services market Very limited use of unbundling and number portability Changes in the regulatory environment More restrictive rules on promotions Award of a 2G mobile license to Wana (February 2009) 2 February 2009

4 Highlights A more difficult economic climate in sub-saharan Africa with solid market growth Economic growth remains robust GDP growth estimated at 5.4% in 2008 But is weakened by average inflation rate* of over 10% in 2008 slowdown in foreign inflows Fast-growing telecoms markets An increasing competition (*) IMF February 2009

5 Highlights Leadership maintained in Morocco Mobile: Customers: 14.5 million / +8.5% vs Penetration*: 74% / +8.3 pts Market share* 63.4% Internet: Customers: 482,000 lines / +1.3% vs ,000 3G+ Internet subscribers Penetration*: 42% of fixed lines (**) 67.3% Fixed-line: Customers: 1.3 million / -2.8% vs %*** Penetration*: 4.3% (***) (*) ANRT (**) Maroc Telecom customer base excluding public telephony (***) Excludes 1.6 million limited mobility subscribers (ANRT) 4 February 2009

6 Highlights Steady increase in consolidated results Revenues MAD 29,521m / +7.2% +6.2% on a comparable basis Earnings from operations MAD 13,889m / +13.5% +13.6% on a comparable basis Operating margin: 47% / +3 pts on a comparable basis Net income Group share MAD 9,520m / +18.5% Net margin: 32.2% / +3 pts 5 February 2009

7 Highlights A high dividend payout A dividend of MAD / share + 18% vs Dividend yield of over 7%* (*) Based on share price at February 20, February 2009

8 Highlights Business review Financial results Outlook 7 February 2009

9 Business review Mobile Mobile in Morocco: Highlights Price reductions and a wider promotional mix: Postpaid International New prepaid promotions Continued roll-out of unlimited call plans in consumer market with extension to business customers Launch of 3G video telephony services, prepaid mobile internet offerings, etc. Addition of new mobile content services: local information, Games...

10 Business review Mobile Customers, '000 - at 31/12 Mobile in Morocco: Customer base and market share Var. yoy Customer base ,5% Postpaid** ,4% Prepaid ,0% Market share* 66,9% 66,5% 63,4% -3,1 pts Postpaid** 59,4% 63,1% 65,4% 2,3 pts Prepaid 67,2% 66,7% 63,3% -3,4 pts Churn 20,3% 25,4% 34,9% 9,5 pts Postpaid** 13,4% 17,9% 17,2% -0,7 pts Prepaid 20,5% 25,7% 35,5% 9,8 pts (*) ANRT (**) including pay-as-you-go subscribers Market shows signs of a slowdown as from 3rd quarter Market share by value of 72.1% (-2.3 pts) Higher churn attributable to the sharp growth in the customer base in 2007 (+2.6 million) 9 February 2009

11 Business review Mobile Mobile in Morocco: ARPU and usage Blended ARPU (MAD/customer/month) Blended usage (Minutes/customer/month) Inbound Outbound Moderate decline in ARPU (-8.4%) despite intensely competitive environment Drop in usage attributable to more restrictive rules on promotions Outbound price/min maintained at MAD 1.30 (ex. VAT) 10 February 2009

12 Business review Mobile African subsidiaries mobile activity: Strong customer growth au 31/ Var. yoy Mauritania Customer ('000) ,1% ARPU (MAD) ,9% Burkina Faso Customer ('000) ,2% ARPU (MAD) ,0% Gabon Customer ('000) ,8% ARPU (MAD) ,7% Aggregate customer base of around 2.6 million, up 38% year on year ARPU declines due to impact of rapid growth in customer base and costof-living increases Significant mobile infrastructure roll-out in Mauritania and Burkina Faso (*) Estimations Maroc Telecom 11 February 2009

13 Business review Mobile Mobile revenues MADm - IFRS published comp. basis published % change comp. basis* Revenues** ,9% Maroc Telecom ,4% Mauritel ,4% Onatel ,1% Gabon Telecom ,1% Mobisud (France + Belgium) ns Mobile revenues / Total revenues** 63,5% 63,4% 65,1% 1,7 pts Positive revenue contribution from subsidiaries: 14.4% increase in subsidiaries revenue (*) and at constant exchange rates (**) gross 12 February 2009

14 Business review Mobile Mobile margins MADm - IFRS published comp.basis published % change comp. basis** Earnings From Operations ,8% Maroc Telecom ,2% Mauritel ,0% Onatel ,5% Gabon Telecom ,4% Mobisud (France + Belgium) ,5% Operating margin 49,5% 49,3% 50,6% 1,3 pts Operating margin increases to 50.6% (up 1.3 pts): Morocco: Tight control over operating costs and acquisition costs Mauritania and Burkina Faso: Costs are well contained despite competitive pressures Increase in amortization due to ramp up of Mobile infrastructure deployment Gabon, growth of close to 50%, excluding impact of new tax levy (10% of revenues) (*) and at constant exchange rates 13 February 2009

15 Business review Fixed-line & Internet Recurring call plan promotions Fixed-line & Internet in Morocco: Highlights Further price rebalancing efforts: MAD 10 increase in fixed-line subscription fee Ramp-up of unlimited call plans and reduction in international call rates Reduction in Data rates (international leased lines, Internet leased lines, VPN) Reduction in ADSL line service charges New TV channels for IPTV bouquet Participation in education initiative to promote use of the Internet in the classroom 14 February 2009

16 Business review Fixed-line & Internet Domestic customer bases at 31/ Var. yoy Fixed-line customer base* ,8% Residential ,1% Corporate ,7% Public telephony ,0% Internet customer base ,4% o/w Mobile broadband (3G) Fixed-line: Internet: Dominant position in the Corporate segment (97% market share**) Moderate fall-off in residential customer base despite increased competition from limited mobility offerings and impact of increase in fixed-line subscription Broadband growth driven by strong demand for Mobile broadband services (*) Fixed-line customer base expressed in number of equivalent lines per access point data (restated) (**) source: ANRT 15 February 2009

17 Business review Fixed-line & Internet Subsidiaries customer bases Customer base - '000 - at 31/ Var. yoy Mauritania Fixed-line ,1% Internet ,0% Burkina Faso Fixed-line ,9% Internet ,7% Gabon Fixed-line ,5% Internet ,0% Aggregate customer base: 227,000 lines / +27% vs Sharp growth in CDMA subscribers (*) Estimations Maroc Telecom 16 February 2009

18 Business review Fixed-line & Internet Fixed-line & Internet revenues MADm - IFRS published comp. basis published % change comp. basis* Revenues** ,1% Maroc Telecom ,5% Mauritel ,4% Onatel ,2% Gabon Telecom ,0% Fixed&Internet revenues / Total revenues** 36,5% 36,6% 34,9% -1,7 pts Morocco: Slight decrease in average monthly bill for fixed-line subscribers (-1.2%) Continued growth in Internet*** (+5%) and Data (+26%) Increase in fixed-line subscription fee of MAD 10 International subsidiaries: Reduction in average monthly bill due to development of CDMA customer base Pricing pressures (*) and at constant exchange rates (**) gross (***) excluding Mobile broadband services 17 February 2009

19 Business review Fixed-line & Internet Fixed-line & Internet margins MADm - IFRS published comp.basis published % change comp. basis* Earnings From Operations ,8% Maroc Telecom ,5% Mauritel ns Onatel ,7% Gabon Telecom ,0% Operating margin 24,1% 23,8% 28,1% 4,3 pts 4.3 pt improvement in Fixed-line margins: Morocco: reduction in interconnection costs and growth in intercompany leased lines Gabon: significant increase following workforce redundancies (*) and at constant exchange rates 18 February 2009

20 Highlights Business review Financial results Outlook 19 February 2009

21 Financial results Changes in consolidation scope and other elements No change in the consolidation scope in 2008 Other elements: Introduction of a 10% levy on mobile telecommunications revenues in Gabon Exchange rate impacts*: Positive in Mauritania (+1.44%) Positive in euro zone and CFA franc area (+1.25%) (*) Carried in the income statement 20 February 2009

22 Financial results Consolidated income statement MADm - IFRS % Var Revenues ,2% Ongoing efforts to reduce costs in all cost categories in order to offset slower growth. Operating expenses (15 298) (15 632) 2,2% Earnings From Operations ,5% Others* (33) (77) 133,3% Net financial income Tax (4 095) (4 196) 2,5% Strong growth in operating margin in Morocco across Mobile and Fixed-line segments. Sharp increase in net financial income attributable to non-recurring items in Gabon (takeover of debt by the state, contingent payments, etc.). The effective tax rate was 29.5%, versus 33.5% in 2007, due to the reduction in the income tax rate in Morocco. Net income ,0% Non-recurring elements in Gabon were eliminated from minority interests Net income group share ,5% (*) Other income and charges from ordinary activities and income from equity affiliates 21 February 2009

23 Financial results Consolidated balance sheet MADm - IFRS % Var Non current assets ,7% Current assets ,3% o/w cash ,1% Subsidiaries account for 23% of balance sheet total Balance sheet total ,9% Excluding net income for the period, total equity is stable Equity ,2% Non current liabilities ,1% Current liabilities ,9% Use of an overdraft facility by Morocco Telecom Assumption by the Gabonese state of a portion of Gabon Telecom s net debt O/W short/long term debt ,5% Maroc Telecom ,5% Subsidiaries ,4% 22 February 2009

24 Financial results Cash flow statement MADm - IFRS Variation Value % Net earnings before net finance costs ,3% Cash flow Operations ,8% Cash flow Investment ,0% Cash flow Financing ,2% Change in cash ns Cash position at the beginning of the period ,9% Cash position at the end of the period ,1% Financial debt ,2% Net cash position ,1% A marginally positive net cash position: Reduction in cash flow from operating activities, due mainly to the negative difference between income tax liabilities and tax paid (reduction in income tax rate was not applied to tax installment payments made in 2008). Network infrastructure expenditure: MAD 6 billion 2007 dividend payout: MAD 8.1 billion Cash generation capacity maintained in 2009: Positive impact of income tax reduction Strict management of working capital requirements (*) Excluding 3G license 23 February 2009

25 Financial results Capital expenditure MADm - IFRS 2006* Var. yoy Capex - consolidated ,0% % consolidated revenues 15,9% 19,9% 20,2% 0,3 pts Mobile ,2% % Mobile gross revenues 13,9% 17,0% 17,1% 0,1 pts Fixed and Internet ,1% % Fixed and Internet gross revenues 14,9% 19,7% 20,6% 0,9 pts Capex - Morocco ,7% % net revenues 15,5% 17,6% 19,1% 1,5 pts Capex - Subsidiaries ,3% % net revenues 26,2% 34,9% 26,7% -8,2 pts Morocco: Intelligent and value added networks, switching, Pacte program 3G network: 1,103 B nodes vs. 400 in 2007 / 2G network: 5,410 BTS vs. 5,026 in 2007 Subsidiaries: Rapid deployment of mobile network infrastructure in Mauritania (BTS +51%) and Burkina Faso (BTS +53%) Lower capital expenditure in 2007 reflects staggering of capital expenditure in Gabon and procurement savings (*) Excluding 3G license 24 February 2009

26 Highlights Business review Financial results Outlook 25 February 2009

27 Outlook A multinational telecoms player A full-service telecoms player operating in six countries Population covered: 50 million With 19.2 million active customers (+11%) Morocco: 89% of customer base / +7% International: 11% of customer base / +35% Focused predominantly on mobile services 89% of customer base 65% of gross revenues 77% of earnings from operations 26 February 2009

28 Outlook A favorable outlook Morocco, a fast-growing economy Solid economic indicators 2009 GDP growth of 6.7%* Stable inflation and unemployment rates bolstered by ambitious capital spending projects Infrastructure, Offshoring, Tourism, etc. Partly financed by foreign investors and measures to improve purchasing power: reductions in income taxes Further room for growth in penetration rates Africa, a promising continent Healthy GDP growth rates: Annual rates of GDP growth in excess of 4% in 2009/2010 (source: IMF) Penetration rates are set to experience rapid growth: Sub-Saharan penetration rate was 19% in 2007 (source: ITU) Significant future revenue and profit streams to be achieved from synergies and implementation of modern management systems (*) HCP forecast 27 February 2009

29 Outlook A sound strategy Morocco, International subsidiaries, Consolidating our leadership: Innovative product offerings Competitive pricing Intensive customer acquisition efforts A high quality, highly reliable network An extensive market presence (over 44,000 points of sale) Maintain margins through: Strict control over customer acquisition costs Aggressive cost cutting efforts Increase penetration rates through network expansion Roll out new product offerings Modernize information systems and management structures Improvements to service quality Optimize the cost base 28 February 2009

30 Outlook 2009 Outlook At a constant consolidation scope: Consolidated revenue growth in excess of 3% EFO margin maintained at 47% 29 February 2009

31 Appendices Customer base and penetration rates Consolidated data Morocco key figures ARPU and Usage in Morocco Mauritania key figures Burkina Faso key figures Gabon key figures 30 February 2009

32 Appendix Customer base and leadership positions Morocco France Belgium (MVNO) Customers (m) Market share Penetration Mobile % leader 74,0% Fixed-line % leader* 4.3%* Internet % leader 42.3%** Customers (k) Mobile 163 Mauritania Customers (k) Market share Penetration Mobile % leader 62% Fixed-line 49 95% leader 1.5% Internet 9 100% leader 18.4%** Burkina Faso Customers (k) Market share Penetration Mobile % / 2 nd 19% Fixed-line % leader 1.1% Internet 17 n/a / leader 11.7%** Gabon Customers (k) Market share Penetration Mobile % / 2 nd 91% Fixed-line % leader 2.2% Internet 14 n/a / leader 42%** Maroc Telecom Group Sources: Morocco (ANRT) / Other countries (ITU) / Maroc Telecom estimates (*) Excluding limited mobility (**) Penetration rate expressed in relation to total number fixed lines (excluding public telephony for Maroc Telecom) 31 February 2009

33 Appendix Consolidated data en MADm - IFRS Variation published comp.basis published published comp.basis* Consolidated revenues ,2% 6,2% Mobile (gross) ,7% 8,9% Fixed and Internet (gross) ,4% 1,1% EBITDA ,7% 12,4% %revenues 56,9% 56,5% 59,8% 2,9 pts 2,3 pts Mobile ,8% 12,5% %revenues 59,1% 58,8% 60,7% 1,7 pts 2,0 pts Fixed and Internet ,4% 12,0% %revenues 38,4% 38,1% 42,2% 3,7 pts 4,1 pts Earnings from Operations ,5% 13,6% %revenues 44,4% 44,1% 47,0% 2,6 pts 3,0 pts Mobile ,9% 11,8% %revenues 49,5% 49,3% 50,6% 1,0 pts 1,3 pts Fixed and Internet ,2% 19,8% %revenues 24,1% 23,8% 28,1% 4,0 pts 4,4 pts Capex %CA 19,9% 20,2% Mobile %revenues 17,0% 17,1% Fixed and Internet %revenues 19,7% 20,6% 9,0% 0,3 pts 10,2% 0,1 pts 7,1% 0,9 pts (*) and at constant exchange rates 32 February 2009

34 Appendix Morocco key figures MADm - IFRS published published Gross revenues Mobile Communications Handsets Fixed and Internet Voice Interconnection Data Internet EBITDA %revenues 55,4% 58,1% Mobile %revenues 62,0% 64,2% Fixed and Internet %revenues 43,4% 46,6% Earnings from Operations %revenues 45,5% 48,1% Mobile %revenues 53,5% 55,3% Fixed and Internet %revenues 31,0% 34,1% Capex %revenues 16,0% 15,0% Variation published 6,3% 8,4% 7,5% 22,7% 2,5% -2,2% -14,3% 26,2% 5,3% 11,5% 2,7 pts 12,1% 2,1 pts 9,9% 3,1 pts 12,3% 2,6 pts 12,2% 1,9 pts 12,5% 3,1 pts 0,0% -0,9 pts 33 February 2009

35 Appendix ARPU and usage in Morocco ARPU (MAD/customer/month) Usage (Minutes/customer/month) Postpaid Prepaid Blended Postpaid Prepaid Blended Inbound Postpaid Prepaid Blended Outbound February 2009

36 Appendix Mauritania key figures MADm - IFRS published published Gross revenues Mobile Fixed and Internet EBITDA %revenues 48,0% 49,1% Mobile %revenues 60,1% 56,9% Fixed and Internet %revenues 16,6% 25,5% Earnings from Operations %revenues 33,7% 31,9% Mobile %revenues 47,6% 41,9% Fixed and Internet -9 5 %revenues -2,8% 1,7% Variation at constant exchange rate -0,4% 3,4% -10,4% 1,8% 1,1 pts -2,0% -3,1 pts 37,2% 8,9 pts -5,8% -1,7 pts -9,0% -5,7 pts ns 4,5 pts 35 February 2009

37 Appendix Burkina Faso key figures MADm - IFRS published published Gross revenues Mobile Fixed and Internet EBITDA %revenues 38,7% 37,0% Mobile %revenues 56,7% 53,7% Fixed and Internet %revenues 22,5% 17,5% Earnings from Operations %revenues 13,9% 12,8% Mobile %revenues 34,2% 30,6% Fixed and Internet %revenues -4,4% -7,9% Variation at constant exchange rate 6,7% 21,1% -6,2% 1,7% -1,8 pts 10,6% -3,1 pts -57,5% -5,0 pts -1,9% -1,1 pts 8,5% -3,6 pts -71,7% -3,5 pts 36 February 2009

38 Appendix Gabon key figures MADm - IFRS published comp.basis published Gross revenues Mobile Fixed and Internet EBITDA %revenues 6,2% 7,1% 19,8% Mobile %revenues 25,2% 23,7% 27,6% Fixed and Internet %revenues -15,2% -10,6% 11,1% Earnings from Operations %revenues -15,3% -13,6% -0,8% Mobile %revenues 7,7% 6,9% 6,4% Fixed and Internet %revenues -41,1% -35,5% -8,8% Variation comp.basis* -1,8% 0,1% -4,0% 172,3% 12,6 pts 60,5% 10,9 pts -57,5% -10,2 pts -93,9% 12,8 pts -7,4% 9,2 pts 76,0% -14,0 pts (*) and at constant exchange rates 37 February 2009

39 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 programs, technological developments or market conditions. Although Maroc Telecom believes that is 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. 38 February 2009