dtac first quarter 2010 30 Apr 2010
Disclaimer Certain forward looking statements may be made in the course of the presentation. These forward- looking statements generally can be identified by use of statements that include words or phrases such as DTAC or its management believes, expects, anticipates, intends, plans, foresees, or other words or phrases of similar import. Similarly, statements that describe DTAC s objectives, plans or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forwardlooking statement. The forward-looking statements contained in the slides are not and should not be constructed as representations of the future performance of DTAC and that such statements are an expression of the Company s reviews based on its current view and certain assumptions including, but not limited to, prevailing economic and market conditions and currently available information. 2
Q110 Highlights THB 6.0 bln EBITDA, and THB 2.4 bln Net Profit Successful iphone launch to sustain data growth momentum Strong Growth in Net Adds Further COST Improvement 3
operational highlights 4
net adds net adds (in thousand) 469 263 119 350 389-126 255 34 221 386 426 71 117-46 -41 631 1 630 Higher prepaid net adds from sharp reduction in inactive subs: - economic recovery, and - usage-stimulating promotion. Stable postpaid sub base. Continued focus on sub quality. Prepaid Postpaid Total 5
blended MOU and ARPU blended MOU (mins / month / sub) blended ARPU (THB / month / sub) +6.1 % 311 307 294 294 61 58 54 54-2.5 % +0. 5% -2.1 % 324 326 54 52 281 279 271 271 278 272 62 59 56 55 56 54 250 249 240 240 270 274 219 220 215 216 222 218 incoming outgoing incoming outgoing Outgoing minutes continued to grow. ARPU slightly declined from higher on-net traffic and larger sub base. Investor relations: www.dtac.co.th E-mail: ir@dtac.co.th
Financial highlights 7
total revenue up 6.7% YoY (THB million) 16,391 16,501 16,943 17,607 16,029 16,212 266 254 206 212 329 704 3,405 3,266 3,149 3,140 3,174 3,181 20,000 Strong YoY service revenue growth. 15,000 10,000 5,000 +6.7% +3.9% 12,720 12,981 12,674 12,861 13,440 13,722 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 IC revenue was stabilizing QoQ but declining YoY. Strong growth in sale of handsets. 0 Service revenue excl IC IC Revenue Handset & Other 0 8
service revenue breakdown 9.5% 3.4% 4.4% 20.1% 10.3% 2.9% 4.4% 19.1% 10.4% 2.8% 4.8% 18.8% 17.9% 17.2% 16.7% 44.6% 46.1% 46.5% Q109* Q409 Q110 * calculated from figures after adjustment of VAS discount. Postpaid airtime Prepaid airtime VAS International Roaming (IR) Interconnection Others Higher prepaid voice portion from on-net off-peak promotion. YoY increase in non-voice portion from focus on smart phone and data usage. 9
cost efficiency programs continued to pay off cost of services (THB million) excluding amortization % to service revenue (excl IC) -1.7 % -2.0 % 42.5% 41.7% 40.5% 40.3% 40.4% 38.8% 48.5% 43.5% 38.5% 27.4% 27.9% 30.0% 26.9% 26.8% 26.4% 26.3% 25.0% 33.5% 28.5% 20.0% 23.5% 5,403 5,413 5,139 5,184 5,431 5,322 18.5% 13.5% 7.7% 7.4% 7.0% 7.2% 7.6% 6.6% 15.0% 8.5% 3.5% 7.4% 6.4% 6.6% 6.3% 6.4% 5.9% -1.5% 10.0% Total % to service rev (excl IC) Network Opex Other cost Regulartory cost 10
further reduction in net IC cost net IC cost (THB million) - -50 Continued improvement in net IC balance. -100-150 -200-250 -240-272 -240-184 -145 This was mainly driven by lower outgoing off-net traffic. -300-320 -350 11
sharp YoY reduction in SG&A SG & A (THB million) - 7.5 % 11.3% 11.3% 12.0% 11.6% 10.2% 9.9% -0.1 % 17.2% 16.4% 16.5% 15.9% 14.8% 14.2% 2,821 2,705 2,649 2,577 2,506 2,503 5.9% 3.9% 5.8% 4.7% 5.1% 5.1% 4.9% 5.1% 4.5% 4.3% 4.6% 4.3% SG&A % of total rev Note : SG&A expenses include impairment of goodwill & intangible asset, but exclude depreciation and amortization (A&D). Selling and Marketing expenses as % of total revenues Bad debt as % of postpaid revenues Admin excl A&D as % of total revenues 12
EBITDA margin continued to improve EBITDA (THB million) EBITDA margin 45% 14,000.00 40% 12,000.00 10,000.00 8,000.00 6,000.00 +25.2 % 4,465 4,820 4,772 5,064 +8.6 % 5,559 6,037 27.0% 29.1% 29.6% 31.1% 32.6% 34.2% 35% 30% 4,000.00 25% 2,000.00 0.00 20% 13
net profit up 66.3% YoY A&D (THB million) net profit (THB million) +6.1 % +0.6 % 2,476 2,410 2,571 2,499 2,541 2,556 +66.3 % +13.7 % 2,445 2,151 1,470 1,364 1,629 1,239 A&D - SG&A A&D - cost of service 14
healthy cash flow and solid financial position operating FCF(THB billion) financial ratios 5.6 4.5 4.8 4.8 5.0 3.5 3.3 3.9 3.6 1.9 2.6 1.3 1.5 2.0 1.1 6.0 5.4 0.6 79.5 87.3 84.5 67.8 67.7 61.6 17.7 12.7 12.7 14.8 11.6 12.1 0.9 0.7 0.6 0.3 0.6 0.2 FFO to Total Debt (%) Interest Coverage Ratio Net debt to EBITDA EBITDA Capex Operating FCF 0.4 0.3 0.2 0.1 0.2 0.1 Net debt to Equity interest-bearing debt (THB billion) 28.1 27.4 26.5 24.8 19.0 18.3 8 6 4 2 0 debt maturity profile (THB billion) 6.5 4.2 5.2 1.2 1.1 Q210 Q310 Q410 2011 2012-2015 15
regulatory update 16
regulatory update NTC The chairman has been elected and royally endorsed. New 3G time frame is under review by new NTC board. Concession amendment Under review by section 22 committee. Time frame imposed by economic ministers was extended by 60 days (May 2010). MNP NTC ordered the service launch by Aug 2010. The implementation of clearing house is in progress. 17
Outlook 18
outlook for 2010 unchanged 19
Appendix 20
more traffic kept on-net outgoing on : off-net traffic off-net incoming : outgoing traffic 31% 29% 29% 28% 25% 24% 47% 47% 47% 47% 46% 46% 69% 71% 71% 72% 75% 76% 53% 53% 53% 53% 54% 54% off-net on-net outgoing incoming 21
postpaid net adds (000 subs) MOU (mins/month/sub) ARPU (bt/month/sub) 119 34-46 -41 1-4.9 % -2.3 % +1.7 % - 0.6% 658 666 662 506 528 524 524 514 502 620 650 656 107 105 106 107 106 106 109 107 108 110 109 109-126 398 423 418 417 408 396 511 543 548 548 557 553 Q408 Q109 Q209 Q309 Q409 Q110 incoming outgoing Q408 Q109 Q209 Q309 Q409 incoming outgoing Q110 22
prepaid net adds (000 subs) MOU (mins/month/sub) ARPU (bt/month/sub) 630 +9.9 % -1.8 % +1.4 % -1.9 % 350 389 221 117 426 284 277 300 304 264 264 54 51 47 46 47 47 230 226 217 217 253 259 234 228 221 221 229 224 56 52 49 48 48 46 178 176 172 173 181 178 outgoing incoming outgoing incoming 23
registered vs active subs (in million) 16.7 17.4 18.2 18.7 18.9 19.2 19.3 19.7 20.3 22.2 22.6 18.1 19.2 20.2 20.9 21.1 21.5 21.8 Q108 Q208 Q308 registered subs active subs 24