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Analyst Teleconference 3rd Quarter 2007 19 October 2007 Strong - - PDF document
Analyst Teleconference 3rd Quarter 2007 19 October 2007 Strong - - PDF document
Analyst Teleconference 3rd Quarter 2007 19 October 2007 Strong revenue growth momentum High MOU and stable ARPU Special dividend 73 sen net per share 2 DiGi in Q307 EBITDA (RM mil) Revenue (RM mil) Strong revenue growth momentum on
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DiGi in Q307
1113 526 1058 502
273 250
241 93
Revenue (RM mil) EBITDA (RM mil) PAT (RM mil) Net Adds (‘000)
Q207 Q307 Q207 Q307 Q207 Q307 Q207 Q307
47.4% 47.3%
Strong revenue growth momentum
- n increasing MOU and stable ARPU
solid EBITDA margin
Healthy gross activations
added 93k new customers prepaid impacted by rotational churn steady postpaid growth
Ongoing focus:
strengthen key market offerings
- perational excellence
upgrade of core technology platforms
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Higher competitive pace in Q3
1Plan and 1LFR reinforcing simplicity and best value position Strengthening brand affinity – YCF and True Value postpaid & prepaid campaigns Launched DiGiRemit – international mobile cash remittance
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Q307 – key numbers
Q307 Q-o-Q vs Q207 Y-o-Y vs Q306 Customer base
6.1 mil +2% (6.0 mil) +9% (5.6 mil) (RM1,058mil) (RM921 mil) (RM419 mil) (45.5%) (RM181 mil) 24.1 sen (RM502 mil) (47.4%) (RM250 mil) 33.4 sen
Revenue
RM1,113 mil +5% +21%
EBITDA
RM526 mil +5% +26%
EBITDA margin
47.3%
- 0.1pp
+1.8pp
PAT
RM273 mil +9% +51%
EPS
36.4 sen
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Healthy gross activations; high rotational churn
5477 5432 5234 4807 5126 5018 639 592 549 505 464 422 Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007
+7% Prepaid +38% Postpaid +1% Prepaid +8% Postpaid
Added 93k new customers Prepaid impacted by high rotational churn 1Plan driving postpaid growth
Custome rs
Q2 Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007 Postpaid (‘000) Subscriber market share
25.3% 25.6% 27.3% 27.3% 28.1%
Prepaid (‘000)
28.4%
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Flat price models stimulating higher usage
AMPU
+16% Prepaid +14% Postpaid +20% Blended
Prepaid (mins) Postpaid (mins)
392 422 418 432 459 479
Blended (mins)
Strong overall usage in Q3 Market responsive to new value propositions
163 162 173 193 187 194 144 140 150 168 158 162
Q2 Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007
+3% Prepaid +4%Postpaid +4% Blended
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8 50 49 52 55 54 55 54 53 55 59 58 59 +12% Prepaid +1% Postpaid +11% Blended
Stable ARPU
ARPU
105 95 90 94 89 96
Prepaid (RM) Blended (RM)
ARPU supported by increasing usage Relatively stable APPM
* (Including one-time adjustment
- f RM12 mil for postpaid (RM10 on
postpaid and RM1 blended ARPU))
Postpaid (RM)
+2% Prepaid +8% Postpaid +2% Blended
Q2* Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007
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Maintained strong revenue growth
Re ve nue
Q2 2006 Q3 2006 Q4 2006 Q1 2007 Q2 2007 Q3 2007
Revenue (RM mil)
- Est. Mobile Revenue Market share
Revenue up on strong usage Prepaid revenue grew 3% q-o-q Postpaid revenue grew 16% q-o-q
+21%
* (Q206 revenue included an one-time adjustment of RM12 mil for postpaid)
24.6% 24.4% 24.4% 25.4%
904 921 967 1015 1058 1113
Q2* Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007
+5%
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Steady growth in data revenue
Da ta re ve nue
111 118 129 134 139 144 SMS +22% Non-SMS +30%
Q2 Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007
154 164 180 188 197 204 43 46 50 54 58 60
18.1% 18.7% 19.5% 19.0% 19.2% 18.8%
Data growth
- utpaced by
stronger voice growth Strong focus on bundled VAS innovations
SMS (RM mil) Non-SMS (RM mil) % of mobile revenue
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Solid EBITDA margin
E BIT DA
+26% +5%
EBITDA Margin (%) EBITDA (RM mil)
Growth in line with revenue development Margin sustained by moderate A&P spend in Q3
- Q206 normalised EBITDA margin 44.6%
**Q406 normalised EBITDA margin 46.6%
410 419 476 497 502 526
45.3% 45.5% 49.2% 49.0% 47.4% 47.3%
Q2 Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007
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PAT up on higher EBITDA; and Lower depreciation and amortisation charges in Q3
(invoice-price variances in prior years’ capex)
Solid PAT
PAT
(RM mil) Q307 Q207 Q107 Q406 EBITDA 526.2 501.8 497.2 (160.8) 336.4 2.6
(3.4) 6.0
339.0 (93.0) 246.0 32.8 Depreciation & Amortisation (156.5) (162.4) 475.8 (184.5) 291.3 2.7
(4.4) 7.1
294.0 (54.4) 239.6 EBIT 369.7 339.4 Net finance income
- Finance costs
- Interest income
5.5
(3.8) 9.3
5.1
(3.9) 9.0
PBT 375.2 344.5 Taxation (101.9) (94.2) PAT 273.3 250.3 EPS (sen) 36.4 33.4 31.9
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Ca pe x
Business growth supported by focused capex spend YTD Partial roll-over
- f planned
investments in network quality, capacity and upgrades to 1H08
Q2 Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007
117 215 101
12.9% 23.3% 30.3% 10.0% 9.3% 14.3%
Capex (RM mil) Capex/Revenue
98
Higher capex in Q3 as planned
293 159
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73 sen net special dividend
Committed to a more efficient capital structure Cash dividend (net sen/share) : paying progressively higher dividends
CR1 CR2 IntDiv FinDiv IntDiv SpDiv 10/05 4/06 7/06 4/07 7/07 10/07
75 sen 60 sen 38.5 sen 50 sen 42 sen 73 sen
Capital Repayment (CR) Dividends (interim/final) Special Dividends
YTD FY 2007 FY 2006 Total borrowings RM300 mil RM300 mil Cash & cash equivalents RM931 mil RM870 mil ROE 42.0% 46.0% ROCE 43.1% 43.8% *FCF/share 49.0 sen 24.4 sen
* FCF = EBITDA - Capex Total pay-out RM2.5bn
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Verbal updates
Industry and regulatory updates Telenor sell-down
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Raising 2007 guidance
Revised guidance Revenue growth (%) high teens EBITDA margin (%) around 47% - 48% Capex RM600 mil - RM700 mil PAT / EPS growth (%) high 20’s
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High level 2008 Guidance
Guidance Revenue growth (%) high single digit EBITDA margin (%) mid-40’s Capex RM700 mil - RM900 mil PAT / EPS growth (%) high single digit
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terima kasih thank you mange takk
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Breakdown of mobile revenue
Prepaid +21% Postpaid +39%
Others (RM mil) Postpaid (RM mil) Prepaid (RM mil)
Prepaid +3% Postpaid+16%
Q2 Q3 Q4 Q1 Q2 Q3 2006 2006 2006 2007 2007 2007
726 748 792 839 876 906 865 887 933 999 1040 1097 127 127 130 149 153 177
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Opex breakdown
(RM mil) Q307 Q207 Q107 Q406 Cost of materials 15.0 14.5 15.4 189.5 118.3
51.9 66.4
49.5 61.1 86.3
55.1 4.5 26.7
520.1 49.0% Traffic charges 212.0 199.6 21.4 182.4 130.7
62.2 68.5
42.3 65.7 Other expenses
- USP fund and license fees
- provision for bad & doubtful debts
- others
101.8
63.4 6.5 31.9
91.4
59.0 4.5 27.9
57.0
32.6 5.0 19.4
499.5 Sales & Marketing
- advertising & promotions
- commissions
132.0
58.1 73.9
133.5
63.8 69.7
Staff Costs 62.1 55.6 Operations & Maintenance 66.2 62.6 TOTAL 589.1 557.2 EBITDA margin 47.3% 47.4% 49.2%
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Key changes impacting q-o-q EBITDA margin
+0.8% (Sales & Mktg @ 11.8%)
- 0.3% (Staff costs @ 5.6%)
47.3%
EBITDA margin Q307 EBITDA margin Q207
47.4% @ denotes % of revenue in Q307 0.0% (Ops & Maint @ 5.9%)
- 0.5% (Others @ 9.0%)
- 0.1% (Costs of Mats & Traffic @ 20.4%)
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Cash-flow
(RM mil) Q307 Q207 Q107 Q406 Cash at start 1,009.0 937.9 417.5 57.9 (89.5)
(98.5)
(314.8) 71.1 1,009.0 403.3 1,138.8 869.5 458.6 (296.2) (94.0)
(100.9)
0.0 68.4 937.9 355.2 108.1 (282.6)
(292.6)
(450.0) (269.3) 869.5 Cash-flow used in financing activities (375.0) 396.3 183.2 Net change in cash (78.3) Cash-flow from operations 392.5 Changes in working capital 53.0 Cash-flow used in investing activities
- Capex
(148.8)
(158.8)
Cash at end 930.7 Operational cash-flow
(EBITDA – Capex)
367.4
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Disclaimer
This presentation and the following discussion may contain forward looking statements by DiGi.Com Berhad (“DiGi”) related to financial trends for future periods. Some of the statements contained in this presentation or arising from this discussion which are not of historical facts are statements of future expectations with respect to financial conditions, results of operations and businesses, and related plans and
- bjectives. Such forward looking statements are based on DiGi’s current views and