Hellas Group 3nd Quarter 2007 Results. November 15, 2007

Transcription

1 Hellas Group 3nd Quarter 2007 Results November 15, 2007

2 Forward looking statement This presentation includes forward-looking statements. These forward-looking statements include all matters that are not historical facts, statements regarding WIND Hellas intentions, beliefs or current expectations concerning, among other things, WIND Hellas results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which WIND Hellas operates. By their nature, forward-looking statements involve risks and uncertainties, including, without limitation, the risks and uncertainties set forth in WIND Hellas Offering Memorandums, because they relate to events and depend on circumstances that may or may not occur in the future. WIND Hellas cautions you that forward-looking statements are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the industry in which WIND Hellas operates may differ materially from those made in or suggested by the forward-looking statements contained in this presentation. In addition, even if WIND Hellas results of operations, financial condition and liquidity and the development of the industry in which WIND Hellas operates are consistent with the forward-looking statements contained in this presentation, those results or developments may not be indicative of results or developments in future periods. WIND Hellas does not undertake any obligation to review or confirm analyst expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise after the date of this presentation. The Senior Secured Notes, the Senior Notes, the Subordinated Notes and the PIK Senior Notes have not been registered under US Securities Act of 1933, as amended (the US Securities Act ), or any state securities laws, and were offered and sold only outside the United States pursuant to Regulation S under the US Securities Act and to qualified institutional buyers in the United States in reliance on Rule 144A under the US Securities Act. 1

3 Agenda Q307 Performance Highlights Consistent Strategy Geared towards Maximizing Returns Q307 Operating and Financial Performance Review Q & A 2

4 Q307 performance highlights Strong fundamentals resulting in ongoing profitable growth Group yet again secures key operating results 19.0% y-o-y increase in the group s reported customer base in Q307 WIND Hellas contract ARPU grows despite interconnection tariff decline on the back of solid and continuous usage upside, with blended ARPU declining mainly due to prepaid uptake Steady decrease in WIND Hellas postpaid churn to 23.8% in Q307 from 25.0% in Q306 Net Additions slower pace due to new disconnection policy of Q - card Financial profile continues to show tangible progress 1,176.6 mn LTM Q307 total revenues, up 8.0% y-o-y mn LTM Q307 adjusted EBITDA¹ with margin continuing its upward trend Organic EBITDA growth and focus on CAPEX efficiency reinforce strong and increasing cashflow generation LTM Q307 EBITDA¹-Capex of mn Recent acquisition by the Weather Group highlights a new era for the Company Ownership by an international telecom s group with extensive experience in the sector Group-wide synergies and economies of scale The acquisition of Tellas by WIND Hellas will enhance the profile of the Group as an Integrated Operator Sustainable profitable growth outlook ¹ Adjusted EBITDA for certain non-recurring or non-cash items Pro forma unaudited financials for WIND Hellas in accordance with IFRS 3

5 Agenda Q307 Performance Highlights Consistent Strategy Geared towards Maximizing Returns Q307 Operating and Financial Performance Review Q & A 4

6 Consistent strategy geared towards maximizing returns Pillars of strategic growth Aspiration Increase market share in prepaid and sustain profitable growth in postpaid segment Accelerate acquisition and increase retention Stimulate usage and ARPU Exploit potential in next generation services Expand into Fixed & Broadband sector Foundation Clear brand positioning and strong value propositions 5

7 Focused strategy, delivery on track Accelerate acquisition and increase retention Accelerate acquisition and increase retention Strategy Differentiate with innovative tariffs and promotions in postpaid and prepaid, and keep up will all competitors major launches Accelerate WIND shop expansion while reducing dependency on more costly channels Launch Proactive upgrade program and increase penetration in loyalty scheme towards high value customers Healthy customer growth and steady reduction in churn Achievements to date EoP customer base increased by 19.0% y-o-y in Q307 Launched Best Price Guarantee in postpaid, prepaid and in handsets/accessories, to enhance value for money positioning Proactive upgrade program towards high value customers along with loyalty programs already yield tangible results WIND Hellas contract churn further drops to 23.8% in Q307 Reinforced own network of WIND stores New and existing WIND stores as well as other channels continue to outperform expectations Own channel exceeds 370 shops by November 15 th 2007 Ongoing radical redesign of Wind Stores Other dealers Germanos Direct WIND Stores WIND Hellas postpaid gross additions mix (%) 'Sept- 07 ¹ 6

8 Focused strategy, delivery on track Stimulate usage and ARPU Stimulate usage and ARPU Strategy Drive F2M substitution via: Tariffs and add-ons with embedded minutes toward fixed destinations new post-paid pricing schemes, that deliver higher ARPU than regular bundle minute programs, Prepaid to post-paid migration acceleration with targeted campaigns Solid traffic uptake Achievements To date Launched Wind takes you higher promo that grants postpaid users the extra usage of a higher value tariff plan with the same monthly fee. First results show positive increase in usage. Prepaid customer base uptake puts pressure on blended ARPU Contract ARPU increases supported by solid outgoing traffic growth despite decreasing interconnection rates Further acceleration of total outgoing traffic growth in Q307 to +21.0% y-o-y Outgoing Traffic (mil, mins) +21.0% 1, Q306 Q307 7

9 Focused strategy, delivery on track Exploit potential in next generation services (VAS) Exploit potential in next generation VAS Strategy Increase data usage and ARPU via driving multimedia handsets penetration, improving portal & content offer, and promoting adoption of mobile Internet Extracting value from high-return VAS uptake Achievements to date 450k average monthly unique users or +56% YoY WAP browsing revenues grew by 85% YoY Over 1.3mn ready-to-use multimedia handsets in customer base, stimulating revenues growth Mobile Broadband (DataCards- ADSM) revenues grew by 135% VAS revenues Growth (excl. p2p SMS) 16.1m +32% 12.3m Q306 Q307 8

10 Focused strategy, delivery on track Expand into Fixed & Broadband sector to accelerate company growth Expand into Fixed & Broadband sector Strategy Accelerate company growth by entering the high potential Greek broadband market Enhance loyalty of postpaid customer base TIM Hellas Q-Telecom Revenue generation and market share gains Strong position to drive significant market inroads Greek broadband market experiences strong growth as it converges rapidly with EU average. Gain leverage from competitive pricing, commercial offerings, current mobile customer base & distribution network Focus on voice and data offering with nationwide coverage Economies of scale and synergies with mobile (discount in m. fees after combination of mobile with fixed-adsl Recent launch of integrated fixed-mobile product is well received by market 9

11 Agenda Q307 Performance Highlights Consistent Strategy Geared towards Maximizing Returns Q307 Operating and Financial Performance Review Q & A 10

12 Group financial performance Continue delivering on superior growth profile Total revenues (EUR, million) +8.0% 8.1% 1, , LTM Q306 LTM Q307 Q306 Q307 WIND Hellas Adjusted EBITDA 1 (EUR, million) 33.8% +19.8% 37.5% 38.9% 26.4% 45.5% LTM Q306 LTM Q307 Q306 Q307 As % of total revenues ¹ Adjusted EBITDA for certain non-recurring or non-cash items Pro forma unaudited financials for WIND Hellas in accordance with IFRS 11

13 Key revenue drivers performance Strong customer uptake puts pressure on ARPU Subscriber base (EOP, 000 s) Net Additions ( 000 s) +19.0% -70.9% 3,733 4, Sept-06 Sept-07 Q306 Q307 1 ARPU 2 (EUR) LTM Q LTM Q307 Q306 Contract Blended PrePaid 10.6 Q307 1 Q307 churn spiked due to new disconnection policy of Q card. Excluding Q card Net Additions for Q307 were 98 thousand. Strong Q306 Net Additions were affected by seasonal offering 2 Pro forma unaudited ARPU figures in accordance with IFRS, including revenues from foreign roamers, on reported subscriber base 12

14 Operating expenses performance Constrained SAC/SRC & other opex efficiencies further boost EBITDA Acquisition & Retention expenses (EUR, million) 7.0% 8.0% 7.0% 6.8% % % LTM Q306 SRC SAC LTM Q307 % as of total revenues Q306 SRC SAC Q307 % as of total revenues Other operating expenses 1 (EUR, million) 59.2% -0.8% 54.5% % -1.5% 47.7% LTM Q306 Other Opex LTM Q307 Q306 Q307 % as of total revenues Other Opex % as of total revenues ¹ Adjusted for certain non-recurring or non-cash items Pro forma unaudited financials for WIND Hellas in accordance with IFRS 13

15 LTM adjusted EBITDA 1 bridge Dec-06 to Sep-07 (in mm) 65.1 (1.3) (13.9) (3.0) (9.7) LTM Dec-06 Outgoing revenues Net Visitor Roaming Net F2M Interconnection Net M2M Interconnection SAC & SRC Others 2 LTM Sep-07 Fully on track to deliver 2007 EBITDA target LTM Sep-07 Group adjusted EBITDA, pro forma to the 13.3 million of Vodafone roaming synergies, comes in at million ¹ Adjusted EBITDA for certain non-recurring or non-cash items 2 Mostly due to Vodafone roaming Pro forma unaudited financials for WIND Hellas in accordance with IFRS 14

16 Cash flow generation Top-line and margin growth sustain robust cash flow generation Capex (EUR, million) Capex as % of total revenues % % 13.5% LTM Q306 LTM Q307 LTM Q306 LTM Q % EBITDA 1 Capex (EUR, million) 21.2% 24.0% LTM Q306 EBITDA-Capex LTM Q307 LTM Q306 LTM Q307 (EBITDA-Capex) as % of total revenues ¹ Adjusted EBITDA for certain non-recurring or non-cash items Pro forma unaudited financials for WIND Hellas in accordance with IFRS 15

17 Tellas Acquisition Overview Becoming a fully-integrated telecoms operator TRANSACTION OVERVIEW Wind Hellas has agreed to acquire a controlling stake in Tellas, a Greek fixed-line and broadband operator presently owned by PPC SA ( PPC ) and Wind Telecommunicazioni ( Wind Italy ) Wind Hellas will acquire the stake owned by PPC (50% minus one share) for a total consideration of 175 mn and purchase 2 shares from Wind Italy for 5 mn, bringing Wind Hellas ownership in Tellas to 50% plus one share With this acquisition, Wind will establish a strong foothold in the attractive fixed / broadband Greek markets The acquisition is subject, inter alia, to applicable regulatory approvals FINANCING Wind will use a part of its excess cash position ( 45m) as well as drawings under its existing revolver to fund the purchase of the shares Wind has requested an amendment for a waiver to increase the size of its RCF from 150 mn to 250 mn to fund the transaction. Process is expected to be finalized by end November RATIONALE FOR THE TRANSACTION Attractive broadband market Low broadband penetration: with household penetration of only 20.5% in June 2007, Greece lags behind the rest of Europe, providing the market with considerable room for further growth Absence of cable competition & favourable LLU regulation Tellas is a strong and dominant player Strong and established brand in the fixed line market (largest CS/CPS operator, largest LLU operator) Extensive network: 1,800km optical fiber backbone and ca. 70 sites today with 90 sites to be connected by year end Realises synergies, as Wind & Tellas bring complementary strengths Complementary offers, networks and distribution channels Efficiency in advertising, communication spend and Back office / Customer Care 16

18 Agenda Q307 Performance Highlights Consistent Strategy Geared towards Maximizing Returns Q307 Operating and Financial Performance Review Q & A 17