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RETURN TO GROWTH OF OUTGOING STRONG REVENUE … · H1 2016 H1 2017 3G 2G 86.6% 89.0% 99.5% 99.5% 4G...
Transcript of RETURN TO GROWTH OF OUTGOING STRONG REVENUE … · H1 2016 H1 2017 3G 2G 86.6% 89.0% 99.5% 99.5% 4G...
SUCCESS OF THE VOLUNTARY
REDUNDANCY PLAN IN MOROCCO
1,026 beneficiaries
ACCELERATED DEPLOYMENT OF 4G+ IN
MOROCCO:
80% POPULATION COVERAGE RATE
INCREASE OF 1.4 PT IN THE GROUP
EBITDA MARGIN TO 50%
RETURN TO GROWTH OF OUTGOING
MOBILE REVENUE IN MOROCCO THANKS
TO SUCCESS WITH DATA
+1.6%
HIGHLIGHTS
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STRONG REVENUE GROWTH OF NEW
SUBSIDIARIES
+8.0%
at constant exchange rates
SUSTAINED GROWTH GROUP SHARE OF
ADJUSTED NET INCOME
+5.9%
at constant exchange rates
21.0 21.4
32.0 33.7
H1 2016 H1 2017
OPERATIONAL AND FINANCIAL ACTIVITIES
I GROWTH IN CUSTOMER BASE I (million) I GROWTH OF OUTGOING SERVICES REVENUE I (MAD million)
International
Maroc
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In Morocco, thanks to the STRONG INCREASE IN MOBILE INTERNET
where revenues grew by 57%
In the subsidiaries, despite an unfavorable economic climate and the
deactivation of unidentified customers
*At constant exchange rates
H1 2016 H1 2017
+2.3%
+1.8%
+2.1%*
INCREASE OF 3.8% IN GROUP CUSTOMER BASE TO
MORE THAN 55 MILLION CUSTOMERS
Continued growth of customer base despite the customer identification process in all countries
Sustained growth of 22% in customer base of new subsidiaries
53.0 55.0 +3.8%
+5.1%
+1.9%
SUCCESS OF INTERNATIONAL DEVELOPMENT STRATEGY
% GROUP CUSTOMER BASE
% GROUP REVENUES
% EBITDA
H1 2016
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H2 2016
61%
43%
35%
H1 2017
61%
44%
37%
60%
44%
33%
Morocco
International
REGULATORY HIGHLIGHTS
IN MOROCCO
Reinstatement by the regulator of a 20% asymmetry in Mobile call terminations starting March 1, 2017
Referral by Inwi regarding the implementation of unbundling
Launch by the regulator of consultations for the demarcation of the pertinent markets for 2018-2020
AT SUBSIDIARIES
Strengthening of constraints associated with unidentified customers: constraints on sales of SIM cards and
suspension of customers
Decreases in call termination rates with a positive impact on margins
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Inwi Orange Maroc
Maroc Telecom
0.1399 DH/Mn
0.1399 DH/Mn 0.1399 DH/Mn
0.1169 DH/Mn
January 1, 2013 March 1, 2017
RESULTS OF THE FIRST HALF OF 2017
H1 2017 ACHIEVEMENTS
Slight drop in revenues following impact of latest regulatory measures
Stable EBITDA
-2.3%
+0.4%
17.7%
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CAPEX of approximately 23% of revenues, excluding frequencies or licenses
UPDATING OF OUTLOOK FOR 2017 At constant scope and exchange rates
MOROCCO – MOBILE / RETURN TO GROWTH IN OUTGOING SERVICE REVENUES
-7.8%
-11.3%
-8.1%
-6.0% -5.2%
-2.0%
-6.3%
+2.9% +1.6%
H1 13/12 H2 13/12 H1 14/13 H2 14/13 H1 15/14 H2 15/14 H1 16/15 H2 16/15 H1 17/16
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H2 16/15 H1 17/16
4,986 5,064
1,749 1,371
199 117
H1 2016 H1 2017
MOROCCO– MOBILE
16,466 16,635
1,713 1,776
S1 2016 S1 2017
+3.7%
+1.0%
18,411 18,179
Prepaid Postpaid
H1 2016 H1 2017
+1.3% 6,552
6,934 -5.5%
60.1 56.9
S1 2016 S1 2017H1 2016 H1 2017
I MOBILE CUSTOMER BASE I (000)
-5.2%
I ARPU I (MAD/month)
I MOBILE REVENUE I (MMAD)
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Outgoing revenue Equipment Incoming revenue
-21.6%
+1.6%
RETURN TO GROWTH IN OUTGOING REVENUES
Strong enthusiasm for Data where revenues grew 57%
DROP IN INCOMING REVENUES
Significant decrease in incoming international traffic since the
liberalization of telephony over IP in November 2016
Decrease of 16% of the call termination rate of Maroc Telecom since
March 1, 2017
H1 2016 H1 2017
MOROCCO – DATA MOBILE CONTINUED SURGE IN MOBILE DATA
5,518 6,897
1,426
1,475
S1 2016 S1 2017
+3.4%
+25.0%
8,372
6,944
H1 2016 H1 2017
16,6%
+20.6%
H1 2016 H1 2017
I MOBILE INTERNET CUSTOMER BASE I (000) I DATA TRAFFIC I (GB)
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+82%
38% 45% Penetration rate*
* Calculated on the Maroc Telecom overall base
I REVENUE DATA I (000)
+57%
STRONG SURGE FOR 3G/4G INTERNET AS A RESULT OF
the expansion of the 4G+ network
The strong growth in 4G usage where traffic represented 35% of Mobile
Internet traffic in H1 2017
MAROC TELECOM IS THE CLEAR LEADER IN MOBILE INTERNET WITH A
47.5% MARKET SHARE AT THE END OF MARCH 2017
Prepaid
Postpaid
MOROCCO – FIXED AND INTERNET
1,617 1,678 1,197 1,306
H1 2016 H1 2017
+3.8%
+9.1%
Data* Voice (including transit) LL intra Maroc Telecom
+0.3%
-6.9%
+10.4%
Continued STRONG GROWTH OF DATA REVENUES
supported by the success of High-speed offers on ADSL and Fiber Optic
Decrease in voice revenues due to the volatility of
international transit activities with very low margins
4,451 4,471 -0.5%
ADSL Fixed-line
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I FIXED-LINE & INTERNET REVENUE I (MAD million) I FIXED-LINE & ADSL CUSTOMER BASE ** I (000)
*Fixed Data combines Internet, TV over ADSL and business Data services;
** Including low speed and leased connections.
2,150 2,001
1,197 1,322
1,124 1,127
H1 2016 H1 2017
12,684 15,532
18,963 17,722
H1 2016* H1 2017
INTERNATIONAL I MOBILE CUSTOMER BASE I (000) I CHANGE IN REVENUES I
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Q1 2016 Q1 2017
New subsidiaries
Historical subsidiaries
26% 28%
44% 43%
Global 35% 35%
I MARKET SHARES I (%)
H1 2016 H1 2017
7,678 7,582 +0.0%**
-4.3%
+8.0%
Source: Dataxis Q1 2017
Historical subsidiaries
New subsidiaries
Revenue stability at subsidiaries due to the DECREASE IN CALL
TERMINATION RATES
(positive impact on margins)
OUTGOING SERVICE REVENUES SUSTAINED GROWTH OF
1.8%
despite an unfavorable macroeconomic climate and the deactivation
of unidentified customers
31,647 33,254
+5.1%
-6.5%
+22.5%
**At constant exchange rates
*The merger between Gabon Telecom and Moov Gabon in 2016 led to the consolidation of their historical data.
MOROCCO - NETWORK MODERNIZATION
I CAPEX I (MAD million) I COVERAGE I (as % of population)
H1 2016 H1 2017
3G
2G
86.6% 89.0%
99.5% 99.5%
4G 70.0% 80.0%
349 346
834 1,128
369 319
H1 2016 H1 2017
1,552 1,793 +15,5%
14.6% 17.8%
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CAPEX/ REVENUES
Other Very-High-Speed Fixed-Line Very-High-Speed Mobile
CONTINUED INVESTMENT IN HIGH SPEED WITH AN 80% 4G POPULATION COVERAGE RATE, CONFIRMING MAROC TELECOM’S
POSITION AS THE NUMBER ONE 4G+ OPERATOR IN MOROCCO
Introduction of 900 Mhz frequencie on 3G, allowing for improved Indoor and Outdoor coverage
Strong growth in international bandwidth capability and doubling of Mobile Data Network capability in one year
Extension of the residential Fiber Optic access network in order to support the growth in the number of Fiber customers
INTERNATIONAL - NETWORK MODERNIZATION
I CAPEX (excl. licenses) I (MAD million) I CHANGE IN RADIO SITES I
17.4% 16.2%
2,829 3,177
2,398 2,564
H1 2016 H1 2017
+12%
+7%
696 683
639 545
H1 2016 H1 2017
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Historical subsidiaries
New subsidiaries
CAPEX/ REVENUES
-8.0% 1,335
1,228
INTERNATIONAL
Extensions and densification of Radio coverage together with upgrading of infrastructure
Deployment and upgrading of urban and interurban optical transmission networks in order to support the growth of Data and Voice usage
Launch of the Moov Benin 4G network and launch of the 3G network in Niger in progress
5,227 5,741
+10%
3,408 3,092
H1 2016 H1 2017
60% 58%
MOROCCO – MAINTAINING HIGH MARGINS
MAD million H1 2016 H1 2017 Change
REVENUES 10,615 10,076 -5.1%
EBITDA 5,670 5,355 -5.6%
Margin (%) 53.4% 53.1% -0.3 pt
Adjusted EBITA* 3,824 3,493 -8.6%
Margin (%) 36.0% 34.7% -1.4 pt
CAPEX 1,552 1,793 +15.5%
O/w licenses and
frequencies 0 0
CAPEX /Revenues
(excl. licenses and
frequencies)
14.6% 17.8% +3.2 pt
Adjusted CFFO * 3,408 3,092 -9.3%
% EBITDA 60.1% 57.7% -2.4 pt
NET DEBT 13,955 14,493 +3.9%
Net debt/EBITDA 1.2x 1.4x
Adjusted CFFO /
EBITDA (%)
I MAINTAINING GOOD CASH GENERATION I (MMAD)
despite the increase in CAPEX
-9.3% Ajusted
CFFO
EBITDA
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I EBITDA MARGIN I (%)
* Please see Appendix 1
EBITDA Margin
Almost stable
at 53.1%
Cost of sales -7.4% OPEX -2.3%
1,832 1,435
H1 2016 H1 2017
INTERNATIONAL
MAD million H1 2016 H1 2017 Change
Change at
constant
exchange rates
REVENUES 7,678 7,582 -1.3% +0.0%
EBITDA 2,855 3,166 +10.9% +12.4%
Margin (%) 37.2% 41.8% +4.6 pt +4.6 pt
Adjusted EBITA* 1,483 1,794 +21.0% +22.7%
Margin (%) 19.3% 23.7% +4.4 pt +4.4 pt
CAPEX 2,223 1,228 -45.6%
O/w licenses and
frequencies 888 -
CAPEX /Revenues
(excl. licenses and
frequencies)
17.4% 16.0% -1.4 pt
Adjusted CFFO* 1,832 1,435 -21.7%
% EBITDA 64.2% 45.3% -18.9 pt
NET DEBT 5,609 6,164 +9.9%
Net debt/EBITDA 1.0x 1.0x
I EBITDA MARGIN I (%)
37,2%
H1 2016 H1 2017
+0.9 pt
41,8%
+1.4 pt
+2.3 pt
Adjusted CFFO /
EBITDA (%)
64% 45%
Adjusted
CFFO
EBITDA
-22%
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* Please see Appendix 1
+1.1 %
Revenue growth at constant
exchange rates and excluding the
decrease in mobile termination rates
I REVENUES I
Gross margin OPEX
2016 non-recurring
items
I LOW CASH GENERATION I (MAD million)
Due to seasonality of the WCR
+41 +185
H1 2016 Group share of
adjusted net income
Change
Financial
Result
H1 2017 Group share of
adjusted net income
MAROC TELECOM GROUP CONSOLIDATED RESULTS
MAD million HY1 2016 HY1 2017 Change
Change
at constant
exchange rates
REVENUES 17,593 17,091 -2.8% -2.3%
EBITDA 8,525 8,521 +0.0% +0.4%
Margin (%) 48.5% 49.9% +1.4 pt +1.4 pt
Adjusted EBITA* 5,306 5,287 -0.4% +0,1%
Margin (%) 30.2% 30.9% +0.8 pt +0.7 pt
Financial Income -203 -162 -20.2%
Income Tax -1,894 -1,709 -9.8%
Minority shareholders -420 -471 +12.1%
GROUP SHARE OF
ADJUSTED NET
INCOME
2,766 2,923 +5.7% +5.9%
Margin (%) 15.7% 17.1% +1.4 pt +1.3 pt
I ADJUSTED GROUP SHARE OF NET INCOME I (MAD million)
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Change
Income
Tax
-51
Change
Minorities
* Please see Appendix 1
Change
Adjusted
EBITA
-19
2,766 2,923 +5.9%**
** At constant exchange rates
MAROC TELECOM GROUP CONSOLIDATED CASH FLOW
MAD million H1 2016 H1 2017 Change
EBITDA 8,525 8,521 +0.0%
CAPEX 3,775 3,021 -20,0%
O/w licenses and
frequencies 888 -
CAPEX / Revenues
(excluding licenses and
frequencies)
16.4% 17.7% +1.3 pt
Adjusted CFFO* 5,240 4,526 -13.6%
% EBITDA 61.5% 53.1%
Financial expenses -70 -190
Income tax paid -1,935 -1,651
Adjusted CFAIT 3,235 2,685 -17,0%
% EBITDA 37.9% 31.5% -6.4 pt
NET DEBT 15,776 16,959 +7.5%
Net debt/EBITDA 0.9x 1.0x
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* Please see Appendix 1
0.7x
ND/EBITDA
1.0x
ND/EBITDA
Financial
expenses Income tax
paid Dividends to
minority
shareholders Dividends to
shareholders
Other
Dec. 2016 H1 2017
-5,588
-442 -1,651
-1,018
-307
Adjusted CFFO**
+7.5% Exceptional
Elements* + 4,526
-190
-12,289
-16,959
I NET DEBT I (MAD million)
INTERNATIONAL
• Drop in call termination rates with a positive impact on margins
• Continuing growth in profitable returns despite an unfavorable
macroeconomic environment
• Continued investments to increase coverage and improve
quality of service
• Regulatory pressures on customer identification
2017 OUTLOOK
UPDATE ON THE 2017 OUTLOOK, AT CONSTANT SCOPE OF CONSOLIDATION AND EXCHANGE RATE:
Slight decline in revenues due to the new regulatory measures
Stable EBITDA
CAPEX approximately 23% of revenues, excluding frequencies and licenses.
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2017 HIGHLIGHTS
IN MOROCCO
• Reinstatement of a 20% asymmetry on mobile call terminations
as of March 1, 2017
• Liberalization of telephony over IP in November 2016
• Competitive pressure on Mobile
• Substantial 4G investments to support strong growth of data
usage
APPENDIX 1: CHANGE FROM ADJUSTED FINANCIAL INDICATORS TO PUBLISHED FINANCIAL INDICATORS
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( H1 2016 H1 2017
MAD million Morocco International Group Morocco International Group
Adjusted EBITA 3,824 1,483 5,306 3,493 1,794 5,287
Disposal of a real estate asset +297 +297
Restructuring charges -188 -47 -235
Published EBITA 3,824 1,780 5,603 3,305 1,747 5,052
Group share of adjusted net income 2,766 2,923
Disposal of a real estate asset +152
Restructuring charges after taxes -161
Group share of published net income 2,918 2,762
Adjusted CFFO 3,408 1,832 5,240 3,092 1,435 4,526
Disposal of a real estate asset +317 +317
Restructuring charges -573 -7 -580
License payment -33 -33 -438 -438
Published CFFO 3,408 2,116 5,524 2,519 989 3,508
MACROECONOMIC ENVIRONMENT
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4.5%
1.2%
4.5%
Sources: Ministry of Economy and Finance
PIB Actual GDP growth
2015 2016 2017e
5.3% 5.2%
0,0%
5,0%
PIB Actual GDP growth
2015 2016 2017e
MOROCCO INTERNATIONAL
Sources: IMF Data - April 2017
5.6%
Recovery of economic growth as a result of a good agricultural year ahead
Inflation remains under control
Sustained economic growth
Inflation under control overall
MOROCCO - GLOBAL TELECOM MARKET
Source: ANRT Q1 2017
I MOBILE: A MARKET IN DECLINE I
I FIXED LINE: EXCLUDING MOBILE,
THE MARKET CONTINUES TO GROW I I ADSL: EXCLUDING MOBILE, THE MARKET CONTINUES TO GROW I
I MOBILE: FLEXIBILITY IS INSUFFICIENT AGAINST
THE SHARP DECLINE IN PRICES I
Mobile market (million
customers)
Penetration rate (%)
43.0
41.5 41.8
127% 123% 123%
2015 2016 Q1 2017
101 113 110
0.27
0.23 0.22
Outgoing usage
(minute/customer/month)
Price per outgoing mobile minute (MAD/min)
2015 2016 Q1 2017
1,132 1,229 1,268
3.2%
3.6% 3.7%
2015 2016 Q1 2017
ADSL market (000) Penetration rate (%)
1.8 1.8 1.8
0.5 0.3 0.3
6.6% 6.1% 6.1%
2015 2016 Q1 2017
Restricted mobility (million
customers)
Penetration rate (%) Fixed line market (million
customers)
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SCOPE OF CONSOLIDATION OF THE MAROC TELECOM GROUP
Population:
34.2 million
GDP: $106 bn
Mobile penetration: 123%
Mobile market share: 44%
Competitive position: 1/3
Population:
3.9 million
GDP: $5.1 bn
Mobile penetration: 93%
Mobile market share:
58%
Competitive position: 1/3
Population:
18.9 million
GDP: $12.3 bn
Mobile penetration: 83%
Mobile market share:
43%
Competitive position: 1/3
Population:
17.4 million
GDP: $14.3 bn
Mobile penetration: 95%
Mobile market share:
39%*
Competitive position: 2/2
Population:
11.4 million
GDP: $8.8 bn
Mobile penetration: 86%
Mobile market share:
40%
Competitive position: 2/4
MO
RO
CC
O
MA
UR
ITA
NIA
BU
RK
INA
FA
SO
MA
LI
BE
NIN
Population:
5.0 million
GDP: $2.0 bn
Mobile penetration: 22%
Mobile market share:
14%
Competitive position: 4/4
Population:
25.0 million
GDP: $36.9 bn
Mobile penetration:
123%
Mobile market share:
23%
Competitive position: 3/3
Population:
18.8 million
GDP: $7.7 bn
Mobile penetration: 38%
Mobile market share:
20%
Competitive position: 3/4
Population:
7.7 million
GDP: $4.6 bn
Mobile penetration: 73%
Mobile market share:
47%
Competitive position: 2/2
Population:
1.9 million
GDP: $14.2 bn
Mobile penetration:
156%
Mobile market share:
57%
Competitive position: 1/3
CE
NT
RA
L A
FR
ICA
IVO
RY
CO
AS
T
NIG
ER
TO
GO
GA
BO
N
Source: Dataxis – Q1 2017, IMF – April 2017 and ANRT – Q1 2017;
* Sonatel data – Q4 2016
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REGULATORY ENVIRONMENT IN MOROCCO
January 1, 2011 July 1, 2011 January 1, 2012 July 1, 2012 January 1, 2013
0.9232
0.6601
0.4152
0.2534
0.7485
0.5390
0.3390
0.2289
0.6238
0.4679
0.2943
0.2066 0.1399
Maroc Telecom Orange Maroc
Inwi
Call termination rate
MAD/min
March 1, 2017
0.1399
0.1169
Between 2011 and 2013, Mobile call termination rates are a linear average of the peak and Off-peak rates.
IMPORTANT LEGAL NOTICES
FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements and elements of a forward-looking nature concerning the financial position,
earnings from operations, and the strategy and outlook of Maroc Telecom, as well as the impact of certain operations. Although
Maroc Telecom may base its forward-looking statements on what it considers to be reasonable assumptions, those statements do
not guarantee the future performance of the Company. The actual results may materially differ from the forward-looking
statements due to a number of risks and uncertainties, both known and unknown. The majority of these risks are beyond our
control, in particular the risks described in public documents filed by Maroc Telecom with the Moroccan Capital Markets Authority
(www.ammc.ma) and the French Financial Markets Authority (www.amf-france.org), which are also available in French on our
website (www.iam.ma). This presentation contains forward-looking information that can only be assessed up to its publication
date. Maroc Telecom makes no commitment to complete, update, or modify these forward-looking statements in light of new
information, future events, or any other reason, subject to the applicable regulations including Articles III.2.31 et seq. of the circular
of the Moroccan Capital Markets Authority and to Articles 223-1 et seq. of the General Regulations of the French Financial Markets
Authority.
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