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Contents
Macro overview 7
Redefining our strategy 11
Our growth potential 17
Financial analysis 29
Company snapshot 5
3
Disclaimer
This document has been prepared by Telecom Egypt (the “Company”) solely for the use at the analyst/investor presentation, held in connection with the Company. The information
contained in this document has not been independently verified. This document contains statements related to our future business and financial performance and future events or
developments involving Telecom Egypt that may constitute forward-looking statements. Such statements are based on the current expectations and certain assumptions of Telecom
Egypt's management, of which many are beyond Telecom Egypt's control. Such assumptions are subject to a number of risks and uncertainties. Should any of these risks or
uncertainties materialize, or should underlying expectations not occur or assumptions prove incorrect, actual results may (negatively or positively) vary materially from those described
explicitly or implicitly in the relevant forward-looking statement. Telecom Egypt neither intends, nor assumes any obligation, to update or revise these forward-looking statements in
light of developments, which differ from those anticipated.
This document does not constitute an offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares of the Company and neither it nor any
part of it shall form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. This presentation has been made to you solely for information purposes
and is subject to amendment. This presentation (or any part of it) may not be reproduced or redistributed, passed on, or the contents otherwise divulged, directly or indirectly, to any
other person or published in whole or in part for any purpose without the prior written consent of the Company.
4
USA31%
Egypt29%
GCC20%
South Africa
8%
Europe7%
ROW5%
Company snapshotHeritage transformed
TE’s incorporation
• Founded in 1854 with the first telegraph line in Egypt
• Incorporated in 1998 replacing the former Arab Republic of Egypt
National Telecommunication Organization (ARENTO)
• Listed in 2005 on the Egypt and London Stock Exchanges
• Acquired a 45% stake in Vodafone Egypt in 2003 to 2006
• Rebranded the retail business to WE in 2017 with the launch of
mobile services
Government, 80%
Free float, 20%
Institutional, 16%
Retail, 4%
Ownership: Highly diversified solid institutional shareholder base
Market Cap of USD 1.4bn | ETEL EY/ ETEL.CA (as of January-2019)
Free float composition Breakdown of institutions5
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Macro overview
7
87.7
92.2
94.2
96.2
98.2
2014 2015 2016 2017 2018
26%
11%
19%
29%
3%
12%Illiterate
Literate
Primary
Secondary
High school
University degree
Demographic indicatorsYoung population to continue to drive growth
Illiteracy ↓ from 30% in 2016
74% of population is literate
Population (mn) Age distribution (% of population)
Educational attainment (% of population) Unemployment rate (% of population)
Source: CAPMAS 2018 census Source: CAPMAS 2017 census
Source: CAPMAS 2017 census Source: Ministry of Finance
25%
19%
17%
15%
10%
8%5%
2%
0-9
10-19
20-29
30-39
40-49
50-59
60-69
70+
c2mn new customers in
the market every year
61% of population below
30 years
8
13.0% 12.8% 12.7%12.0%
9.9%
2013/14 2014/15 2015/16 2016/17 2017/18
9
9.75% 9.25% 9.75%11.25%
12.25%
15.25%17.25%
19.25%18.25%
17.25%
Macro indicatorsA broad set of healthy indicators across the year
Real GDP growth
(%)Average USD to EGP rate
CBE discount rate Core inflation (YoY)
Source: IMF Source: Central Bank of Egypt
Source: Central Bank of Egypt Source: Central Bank of Egypt
2.9
4.4 4.3 4.2
5.3 5.55.9
7.1 7.7 8.1
8.9 8.9
14.8
17.8 18.1 17.8 17.8 17.7 17.8 17.9 18.0
2014 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018
9.9% 8.8% 9.1%7.7% 7.2% 8.1%
5.5%7.2%
8.4%12.4%
13.9%
25.9%
32.3% 31.9% 33.3%
19.9%
11.6% 10.9%8.6% 8.3%
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Redefining our strategy
11
Adel Hamed
Managing Director &
Chief Executive Officer
Mohamed Shamroukh
Chief Financial Officer
Mohamed Abo-Taleb
Chief Commercial Officer
Tarek Shamekh
Chief Technology Officer
Hany Abdel Moneim
Chief Customer Care Officer
Our leadership teamCaliber from the mobile & fixed industries with local & int’l experience
12
Antar Kandil
Chief Information Officer
Our focus lies on targeted investmentTo serve our strategic goals; boosting Telecom Egypt’s & Egypt’s growth
Mobile launch Overhauling Egypt’s
internet infrastructureExpanding Egypt’s
international network
Strategy
Capex (2018 allocation)
Operational KPIs
Commercial highlights
Outlook
To boost operational growth & capitalize on
existing assets
To provide best service quality to our customers &
induce revenue + economic growth To enable the vision of Egypt as a digital route
c20% c65% c15%
• 1.6mn customers in 2018
• FY revenue reached a high single digit of overall
retail revenue
• C5.2mn customers (+29% YoY)
• c70% of homes connected with fiber to the curb• Growing IC&N revenues (+66% YoY)
• Launching our fully integrated commercial
bundle Indigo plus.
• Sealing a revised national roaming deal &
asymmetric MTRs with two MNOs
• Brand repositioning through customer care &
product offering revamp
• WE Internet increases min. speed to 5Mbps
(60% of homes) & max. speed to 100MBps
• Acquisition of MENA Cable
• Bharti deal: bundling existing TE assets with new
investment of MENA Cable
• Cape to Cairo MoU with Liquid Telecom
• Enterprise integrated offering & solutions
• Financial inclusion platform
• Fiber to the curb reaching 100% by 2020
• Content development and as a product
offering
• Investment in route diversity: new routes
across Egypt & landing stations + Africa-1
• Dev. of digital applications incl. a regional
data center & cloud computing hub
1 2 3Our 3 main strategic
objectives:
13
WE digital transformationOur strategy is driven by creating a comprehensive digital ecosystem to optimize resources and boost the ICT economy
Digital transformation ecosystem
Data centers& cloud IOT
Digital platforms OTT
14
Digital transformation process
WE digital strategy & objectives
Digital team & governance
Internal digital transformation
Digital market disruption
Complete digital inclusion
Apps & solutions
Cloud platforms
World class data center facilities
Submarine cables & fiber connectivity
“WE Digital”
Capitalizing on our assets
Redefining our strategic pillars
1. Institutionalizing the decision supportfunction to drive a new financial erawhere savings and synergies areachieved and commercial decisionsmeasured dynamically pre- & postproduction
2. Longer-term procurement planning tooptimize inventory and lead time todelivery
3. Devising a plan to monetize non-operating assets
Alignment of
business and
technology
objectives
Excellence in
financial &
operational
planning
Process
efficiency &
structural
optimization
Leadership in
data through
customer focus
and innovation
1. Revolutionizing the consumer data world by offering data centered integrated and customized offers
2. Empowering the enterprise customers especially SMEs by providing integrated solutions and IoT products
3. Fortifying the leading wholesale footprint to become a regional hub & avail competitive infrastructure models
1. Business driving technology KPIs andjustify return on investment
2. Technology enabling the launch ofnew innovative data offerings
3. IT & Customer systems becoming akey differentiator in customerexperience
4. Digital transformation to improveexperience, influence customers andreduce unnecessary costs
1. Developing cross division processes
2. Devising a plan to best utilize humancapital and reach an optimalheadcount through “innovativesolutions”
3. Empowering middle management bysegregating authorities and enhancingbylaws with the aim to decentralizeand expedite decision making.
Introducing our “LEAP” strategyThere’s no time to walk
15
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Our growth potential
17
3,029
3,791
4,439
5,197
6,535
Fixed-line marketOur investment in fiber is key for data growth
Fiber access network capacity ( In 000’ homes)
ADSL subscribers ( In 000’s)
Retail revenue growth driven by data( n EGP mn)
Voice and data household penetration
18
2,560 2,408 2,244 2,462 3,108
1,941 2,625 3,631
5,049
7,085
508 440
741
779
1,086
2014 2015 2016 2017 2018
OtherDataVoice
9%
21%
25%36%
29.2% 28.7% 27.7%30.0%
32.4%
13.9%16.6%
19.0%21.8%
26.9%
2014 2015 2016 2017 2018
Fixed line
ADSL
1,978
2,809 3,382
4,070
5,237
1,051 982 1,057 1,127 1,297
2014 2015 2016 2017 2018
TE
Others
2,140
5,180
9,692
12,600
17,567
2014 2015 2016 2017 2018
70% 85%
% of households reached with fiber(excluding the last mile)
2018 2019 2020
100%
Fixed-line market (cont’d)Product revamp to monetize infrastructure investment & providebest value for customers
Fixed customer base( In mn
Expanding our fiber infrastructure
across Egypt to support the nation’s
digital transformation similar to the
schools’ connectivity project
Further monetization of
infrastructure through new FBB
subscription revenue
19
6.2 6.3 6.3 6.5 6.6 6.7 6.9 7.1 7.3 7.4 7.6 7.9
3.0 3.2 3.4 3.4 3.4 3.7 3.8 4.1 4.4 4.6 5.0 5.2
Fixed voice
Fixed data
39,209 38,354 39,622 44,082 39,647
33,717 33,056 33,883 34,117
29,475
22,050 22,236
33,900 32,300
27,500
2,300
3,861
2014 2015 2016 2017 2018
Mobile market subscribers ( In 000’s)
*as of November 2018
109% 104% 106%107%
102%
29% 33% 34% 34%
39%
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Voice penetration
Data penetration
21,770 26,300 28,650
32,790 34,370
4,050
3,820 3,280
3,260 3,230
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
USB
Mobile data
Source: MCIT
Mobile marketCustomer base growing moderately despite newly imposed levy
Mobile voice and data penetration*Mobile data market subscribers* (In 000’s)
Source: MCIT
*Etisalat restated its customer base starting FY 2016
3.3
2.32.9
3.6
0.4
20
Source: Operators’ disclosure
2.32.9
3.33.6 3.9
Dec-17 Mar-18 June-18 Sep-18 Dec-18
TE's mobile subscribers(In mn) New levy imposed in July 2018
c1.6mn in 1 Yr
*as of November 2018
Value bundles targeting
the youth
Best value recharge
platform
Mobile market (Cont’d)Addressing all mobile segments
Plain vanilla prepaid product at mobile launch offering best value for money (flat rate plan – Control & data bundles)
2017
2018
First fully integrated
package in Egypt
bundling land line, ADSL
& mobile in one bill
Convergent postpaid
platform
Flexible mobile internet
platform
21
22
Trans border Terrestrial Cables with Libya & Sudan
Egypt
Iraq
Indonesia
Thailand
Myanmar
Morocco
Algeria
France
QatarIndia
Pakistan
Iran
Oman
Yemen
Saudi Arabia
Turkey
SyriaLebanon
Sudan
Ethiopia
Somalia
Libya
Mozambique Madagascar
Tanzania
Kenya
Greece
Tunisia
Djibouti
Sri Lanka
Jordan
Maldives
Taiwan
Brunei
Vietnam Philippine
JapanKorea
BelgiumUK
Singapore
Germany
China
Cyprus
Italy
Portugal
Eritrea
Bangladesh
Australia
U.A.E
Malaysia
SEAMEWE-3
SEAMEWE-4
FLAG
FALCON-HAWK
IMEWE
EIG
SEACOM
TATA
ALETAR/BRYTAR
TE North
GBI
Taba-Aqaba
AAE1
SEAMEWE -5
Alexandros
MENA Cable
Our cable systems networkoffers reach and reliability
124
6 6 19 12
23
21 23 21 22
29
61 65 54
130
18
17 17 25
33
2014 2015 2016 2017 2018
Cable Projects
Ancillary Services (O&M)
Capacity Sales
International Customer Support
Int’l Carriers revenue breakdown in EGP( In mn)
International ServicesHigher cable revenue offsetting international calls’ global declining trend
Cable system revenue contribution
23
Int’l Customers & Networks revenue breakdown in EGP( In mn)
Int’l Carriers revenue breakdown in USD* (In mn) Int’l Customers & Networks revenue breakdown in USD* (In mn)
Bharti DealAAE1 & SMW5
Consortiums
359 582 410 1,099 801
2,708 2,396 2,794
3,769 3,623
2014 2015 2016 2017 2018
Transit
International Direct Dialing (IDD)
51 76 41 62 45
382 311
277 212 204
2014 2015 2016 2017 2018
Transit
International Direct Dialing (IDD)
881
47 62 338 207
161
165 236
368 386
207
467 655
961
2,316
130
128
173
439
588
2014 2015 2016 2017 2018
Cable Projects
Ancillary Services (O&M)
Capacity Sales
International Customer Support
* Based on yearly average USD exchange rate * Based on yearly average USD exchange rate
2018 agreements & eventsSecuring long-term revenue streams & debt restructuring, a year crowned with Bharti deal execution
Jan
Feb
Jul
May
Aug
Oct
Settled 10-year-long legal disputes over
international voice services with Etisalat Misr
Sep
2018 business calendar
Renewed transmission & infrastructure
agreement with Vodafone Egypt until 2020
with a value of EGP 2.37bn
Signed an agreement with Orange Data until
2020 providing bit-stream services
BoD approved the acquisition of MENA cable
and obtaining long-term USD facilities
Telecom Egypt signed US$200 million
financing deal with African Export-Import
Bank managed by ADIB Egypt
Telecom Egypt obtained US$200 million
long-term financing with Chinese financial
institutions facilitated by Huawei
Telecom Egypt and Etisalat Misr signed two
agreements for national roaming and mobile
termination
Renewed the Int’l services agreement for
EGP4bn & transmission services agreement
for EGP1.5bn with Orange until December
2021& December 2022 respectively
Telecom Egypt and Liquid Telecom
announced MoU signing to enable completion
of the first fibre network from Cape Town to
Cairo
Airtel and Telecom Egypt announced
strategic partnership for global submarine
cable systems
Signed a sales & Purchase agreement (SPA)
for the acquisition of MENA Cable through a
TE subsidiary (EISCC)
Telecom Egypt and Etisalat Misr signed the
first MoU for virtual fixed voice services
Telecom Egypt concluded the acquisition of
Middle East and North Africa Submarine
Cable “MENA”
Telecom Egypt’s BoD approved the
acquisition of 50% of Egyptian International
Submarine Cable Co (EISCC)
Telecom Egypt signed agreement with Bharti
Airtel for global submarine cable systemsTelecom Egypt signed USD 500mn medium-
term syndicated loan
DecTelecom Egypt and Liquid Telecom signed
MoU as Part of Egypt’s FDI initiative24
2019 agreements & eventsStrategic moves, paving the way for the future
Announced a change in the BoD by a decree from
the Egyptian Prime Minister.
2019 business calendar
Signed high-speed bitstream services
agreement with Orange Egypt
Reached agreements with Vodafone Egypt on
transmission, infrastructure services and
dividend distribution
25
Jan
Feb
Agreements with domestic MNOsSecuring long-term revenue streams
Securing longer-term agreements with
domestic mobile operators
Boosting our wholesale revenue stream by
monetizing our infrastructure investmentsOur main
goals1 2
International Services 12bn
1.5bnTransmission Services 10.85bn
Transmission Services
International Services 3bn
3bn
1.5bn
International Services 4bn
Transmission Services 1.5bn
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2028
26
1.5bn
1.5bn
3bn
Vodafone Egypt infrastructure agreements and dividends distribution
International Services 12bn
Transmission Services 1.5bn 10.85bn
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2028
EGP 4.8bn EGP 0.7bn
June 2020March 2019
EGP 5.5bn in dividends
Deleveraging EGP debt
Cost cutting initiatives
Usag
e o
f p
roceed
s 1
2
Investments for expansion3
Interest savings of EGP 490mn in 2019
Reactivating early retirement program
Enabling 2019 CapEx intensity guidance of 30%
12.9
9.2
2.11.5
Current Post dividends
Net debt (bn) Net debt/ EBITDA (x)
18 February 2019
27
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Financial analysis
29
Revenue (EGP mn)
EBITDA (EGP mn)
Net profit(EGP mn)
Operating Profit(EGP mn)
30
Financial highlightsDouble digit EBITDA growth helps maintain net profit in spite of heavy investment
13,950
18,567
22,771
FY 2016 FY 2017 FY 2018
+63.2%
+22.6%
3,801
5,184
6,130
FY 2016 FY 2017 FY 2018
+61.3%
+18.3%
1,991 2,023
3,560
FY 2016 FY 2017 FY 2018
+78.8%
+76.0%
2,670
3,052
3,484
FY 2016 FY 2017 FY 2018
+30.5%
+14.2%
41%
16%
15%
20%
8%
Q4 2018
Revenue by business unitRetail services & specifically data drives revenue growth
Home &
Consumer DomesticEnterprise
International
Carriers Affairs
International
Customers & Networks
FY 2018 performance:
Retail revenue grew 36% YoY relying heavily on strong data performance and higher ARPU.
Home & Consumer noted a growth of 42% YoY driven by the 45% higher data revenue.
Mobile revenue preserved almost the same pace across the year contributing a low single digit to the top line and a
high single digit to the retail revenue.
Enterprise Solutions witnessed a 22% increase driven by the inflow of EGP 482mn in revenues from the schools’
connectivity project and the stable growth of fixed services of 13%YoY.
Wholesale increased 12%. The Bharti Airtel agreement that contributed EGP 1.6bn into our financials and the growth in
infrastructure revenues were the key drivers.
Domestic wholesale rose 8% YoY on the continuing demand for infrastructure leasing by the domestic mobile
operators.
ICA declined 9% YoY in line with the global trend on lower international voice traffic.
IC&N revenue grew 66% on the completion of the Bharti deal in Q3 2018. 31
1,073 1,111 1,077
4,868
4,424
Q4 2017 Q3 2018 Q4 2018 FY 2017 FY 2018
+0.4%
-3.0%
-9.1%
1,6542,085 2,215
5,662
8,064
Q4 2017 Q3 2018 Q4 2018 FY 2017 FY 2018
+33.9%
+6.2%
+42.4%
9031,151
852
2,627
3,215
Q4 2017 Q3 2018 Q4 2018 FY 2017 FY 2018
-5.7%
-25.9%
+22.4%
855 788 818
3,3043,571
Q4 2017 Q3 2018 Q4 2018 FY 2017 FY 2018
-4.3%
+3.9%
+8.1%
956
2,099
450
2,106
3,496
Q4 2017 Q3 2018 Q4 2018 FY 2017 FY 2018
-52.9%
-78.6%
+66.0%
35%
14%16%
20%
15%
FY 2018
Debt
restructuringNational
roaming
International
incoming calls
Energy
Monetizing
investments
Employees
• Debt restructure
EGP to USD
Short term to long term
• Effective interest rate reached 9.1%*
Cost initiativesManaging cost challenges across different divisions
• Training and reshuffling employees across
several divisions to enhance productivity
• Hiring skilled caliber
• Amended national roaming agreement with Etisalat receiving
improved rates
• +20% of traffic is now hosted on TE’s network
• Revamping fixed & mobile price plans to
increase WE’s share of the customers’ wallet
• Optimizing the usage of unutilized assets
• Extracting synergies from existing assets
• Shutting down exchanges which were
replaced with fiber to the curb
• Commercial offers to maximize
int’l traffic on WE’s network
32* Normalizing the EGP 135mn syndicated loan administrative fees
• Total call & employee costs to the normalized revenue declined by 2.1% and 2.6%
respectively, offsetting the 4.7x higher advertising expenses. The decrease in call cost to
revenue was driven by the revision of the national roaming agreement and the wholesale
team efforts in Q4 2017 to decrease illegal bypass.
Income statement (FY 2018)
Revenue
EB
ITD
AO
ther
OP
EX
Net
pro
fit
• Total 2018 revenue reported a 23% YoY increase.
• Fixed and mobile data services grew 43% YoY contributing 46% of overall growth with
the Bharti Airtel agreement (EGP 1.6bn) and the schools’ connectivity project (c0.5bn)
contributing almost the remaining growth.
• Normalized revenue excluding the Bharti Airtel deal grew by 14% YoY.
Expenses
Non-o
pera
tio
nal
Note: All financial figures reported are based on the consolidated financials under the Egyptian Accounting Standards
• EBITDA margin recorded 27% (-100bps YoY) mainly as a result of higher
advertising expenses.
• D&A increased 29% YoY due to the full year impact of the 4G license amortization in
2018 versus only one quarter in 2017 and the continued investment in our fixed and
mobile networks.
• Our full year income from direct investments reported a 6% decline based on the
one-offs taken by Vodafone in Q1 2018.
• Net interest rose c3.9x YoY. Our effective interest rate, excluding the syndicated
loan administrative fees, reached 9.1% due to the successful restructuring of a
large portion of our debt into a lower-interest USD facilities.
• NPAT closed at EGP 3.5bn, higher 14% YoY, and reported a net profit margin of
15%. Normalizing for dispute settlement impact on 2017, net profit for 2018 would
have declined by 15% on the higher interest and finance cost.
33
In EGP mn FY 2018 FY 2017 YoY Q4 2018 Q3 2018 Q4 2017 QoQ YoY
Revenue 22,771 18,567 23% 5,413 7,233 5,442 -25% -1%Home & Consumer 8,064 5,662 42% 2,215 2,085 1,654 6% 34%Enterprise Solutions 3,215 2,627 22% 852 1,151 903 -26% -6%Domestic Wholesale 3,571 3,304 8% 818 788 855 4% -4%International Carriers Affairs 4,424 4,868 -9% 1,077 1,111 1,073 -3% 0%International Customers & Networks 3,496 2,106 66% 450 2,099 956 -79% -53%
Total employee cost (5,216) (5,061) 3% (1,578) (1,263) (1,772) 25% -11%Call costs (4,295) (4,152) 3% (1,123) (1,079) (1,039) 4% 8%CoGS (excl. above expenses) (5,116) (3,138) 63% (1,309) (2,226) (972) -41% 35%S&D (excl. salaries, D&A) (1,388) (533) 161% (370) (455) (238) -19% 56%G&A (excl. salaries, D&A) (624) (499) 25% (230) (174) (159) 32% 45%
EBITDA 6,130 5,184 18% 802 2,036 1,261 -61% -36%Margin 27% 28% (100 bps) 15% 28% 23% (1,334 bps) (837 bps)
Other (expense) / income 147 (1,056) -114% (79) 84 (1,066) -194% 93%
Depreciation (2,096) (1,841) 14% (582) (578) (626) 1% -7%Amortization (620) (264) 135% (174) (146) (162) 19% 7%
Operating profit 3,560 2,023 76% (32) 1,395 (593) -102% 95%Margin 16% 11% 474 bps -1% 19% -11% (1,989 bps) 1,029 bps
Income from investments 2,201 2,337 -6% 650 677 561 -4% 16%
Net finance (cost) / income (288) (382) 25% 2 (132) (190) 102% 101%Net interest (expense) / income (1,024) (264) -288% (439) (181) (216) -143% -104%
Tax (958) (659) 45% (200) (311) 8 -36% -2506%
Net Profit 3,484 3,052 14% (22) 1,448 (431) -102% 95%Margin 15% 16% (114 bps) 0% 20% -8% (2,043 bps) 751 bps
EPS 1.61 1.38 17% -0.12 0.74 -0.36 -116% 66.2%
* EPS includes employees & BOD profit share
Historical 3 year income statement summary
Note: All financial figures reported are based on the consolidated financials under the Egyptian Accounting Standards
In EGP mn 2016 2017 2018Growth y/y
2017 2018
Revenue 13,950 18,567 22,771 33% 23%Home & Consumer 4,228 5,662 8,064 34% 42%Enterprise 2,389 2,627 3,215 10% 22%Domestic Wholeslae 3,004 3,304 3,571 10% 8%International Carriers 3,203 4,868 4,424 52% -9%International Customers & Networks 1,126 2,106 3,496 87% 66%
EBITDA 3,801 5,184 6,130 36% 18%Margin 27% 28% 27% 67 bps (100 bps)
Other (income)/expenses (275) (1,056) 147 284% 114%
Depreciation & amortization (1,535) (2,105) (2,717) 37% 29%
Operating profit 1,991 2,023 3,560 2% 76%Margin 14% 11% 16% (338 bps) 474 bps
Income from investments 668 2,337 2,201 250% -6%
Net finance (income) /cost 693 (646) (1,312) -193% 103%
Tax (680) (659) (958) -3% 45%
Net profit 2,670 3,052 3,484 14% 14%Margin 19% 16% 15% (270 bps) (114 bps)
EPS 1.20 1.38 1.61 14% 17%
34
Cash flow analysis
Cash capex(EGP mn)
Net cash from operating activities (EGP mn)
Note: All financial figures reported are based on Consolidated financials under The Egyptian Accounting Standards.
FCFF(EGP mn)
In-service capex
(EGP mn)
* Normalizing for one-off settlement payment to Etisalat of EGP 919mn * Normalizing for one-off settlement payment to Etisalat of EGP 919mn
1,796 1,597
4,338 4,649
3,496
4,415
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Nor.FY 2018
(500)
147
(2,603) (2,456)
(5,075)
(4,156)
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Nor FY 2018
1,584
2,609 3,312
6,088
8,028
-
5,294
1,420 780
13%
21%
24%33% 35%
0%
10 %
20 %
30 %
40 %
50 %
60 %
70 %
80 %
90 %
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Capex License Capex/sales
2,523 3,159
4,731
7,376
8,499
- -
5,294
3,340
-
21%
26%
34%
40%
37%
10 %
15 %
20 %
25 %
30 %
35 %
40 %
45 %
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Capex License Capex/sales
35
Balance sheet highlights
FCFE *(EGP mn)
Net debt(EGP mn)
Net debt/ EBITDA(Based on annualized EBITDA)
Breakdown of capex in-service
* Normalizing for one-off settlement payment to Etisalat of EGP 919mn
3,810 2,587 1,180 638 998
-466 -389 -3,342 -7,293
-13,854
-3,344 -2,197 2,161 6,656 12,855
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Net debt
Total debt Cash Net debt
-0.9x -0.6x
0.6x
1.3x
2.1x
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
(591)
62
(97)
1,191
797
1,716
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Nor FY 2018
69%
16%
5%
5%4%1% Access Network
Transmission
International cable
Customer care
IT
Others
36
0.61
0.41
1.65
(0.11)0.36
0.56
0.75
1.00
0.25 0.25
(0.3 0)
(0.1 0)
0.10
0.30
0.50
0.70
0.90
1.10
1.30
1.50
1.70
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
EPS (LE) DPS (LE)
0.83
1.76 1.56
1.79
2.04
0.89 0.74
1.99
0.27
0.73
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Consolidated
Standalone
Dividend analysisWe aim to distribute a continuous stream of dividends, balancing distribution with the reinvestment of our cash flows in Capex, which we view as the pillar for growth
EPS after appropriations(In EGP )
EPS before appropriations(In EGP)
Note: All financial figures reported are based on consolidated & standalone financials under The Egyptian Accounting Standards.
Payout ratio(%)
Dividend distribution on standalone financials (based on regulations)(In EGP )
37
0.53
1.40
1.20
1.38
1.61
0.61
0.41
1.65
-0.11
0.36
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Consolidated
Standalone
106%
54%
83%
18% 16%
92%
182%
60%
236%
69%
FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Consolidated
Standalone
*
*proposed dividend / SHS for FY 2018.
Our performance in contextHealthy operational performance in light of heavy investments
Revenue Growth
YoY
EBITDA margin (%)
CAPEX / sales (%)
FY 2018
Actual
23%
27%
In-service: 37%
Cash: 35%
FY 2018
guidance
High single to low
double digit
Mid to high 20s
In-service: 30-35%
Mid to high
single digit
Mid to high 20s
In-service: 30%
FY 2019
guidance
38
