Corporate Presentation
2019YE
Corporate Presentation 2019YE Disclaimer This presentation - - PowerPoint PPT Presentation
Corporate Presentation 2019YE Disclaimer This presentation (Presentation) has been prepared by Forthnet S.A. (the Company) for informational purposes only. The information in this Presentation includes forward-looking statements, which
2019YE
This presentation (“Presentation”) has been prepared by Forthnet S.A. (the Company”) for informational purposes only. The information in this Presentation includes forward-looking statements, which are based on current expectations and projections about future events. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. In light of these risks, uncertainties and assumptions, the events in the forward-looking statements may not occur. Many of these risks and uncertainties relate to factors that are beyond the Company’s ability to control or estimate precisely. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as the date of this Presentation. The Company does not undertake any
Neither the Company, its affiliates nor their respective directors, officers, employees or agents (the “Group”) gives any representation or warranty, express or implied, as to (i) the achievement or reasonableness of future projections, management targets, estimates, prospects, returns, business data or property described in this Presentation, if any or (ii) the accuracy or completeness of any information contained in this Presentation, any other written information or oral information provided in connection therewith or any data that any of them generates. Furthermore, and without prejudice to liability for fraud, no member of the Group accepts or will accept any liability, responsibility or
and all information provided. This Presentation: (i) does not constitute an offer, invitation or solicitation by any member of the Group to subscribe for or purchase or sell any securities or assets in the United States or in any other jurisdiction, nor any form of commitment or recommendation by any member of the Group; (ii) will not, and nor will any other oral or written information made available to a prospective investor, other than a definitive and binding agreement, form the basis of any contractual or other agreement and (iii) does not contain all the information that a prospective investor may wish to have in connection with entering into any transaction. Neither this Presentation nor the information contained herein shall form the basis of any contract or commitment. The provision of this Presentation: (i) does not place any member of the Group under any obligation to provide any further information in relation to any transaction or to update this Presentation or any additional information or to correct any inaccuracies in any such information which may become apparent and (ii) does not place any member of the Group under any obligation to consider or accept any offer, irrespective of whether such offer is the
liability which may be based on this Presentation or any other written or oral information provided in connection therewith and any errors therein and/or
The distribution of this Presentation in certain jurisdictions may be restricted by law and, accordingly, recipients of this Presentation represent that they are able to receive this Presentation without contravention of any unfulfilled registration requirements or other legal restrictions in the jurisdiction in which they reside or conduct business. Forthnet S.A. is a public company with shares listed on the Athens Stock Exchange since 2000. This Presentation should be read with, and in light of, all of the information made publicly available by the Company (including the Company's interim and annual financial statements) in the English language through its ordinary course communications on the Athens Stock Exchange, and all such information is expressly incorporated by reference in this Presentation.
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a) Financials & KPIs b) Business Overview c) Infrastructure
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Key Milestones
Forthnet: the market pioneer that brought Internet and Pay TV in Greece
2018
Enhanced bundling; Nova Energy launch
(4/31)
entertainment and communication services in the country
wide range of fixed telephony, broadband and Pay-TV services to:
Cyprus
(5/31) Company data as 2019ΥΕ
13% 24% 15% 48%
BROADBAND MARKET
Forthnet Vodafone Wind Cosmote
37% 11% 51%
PAY-TV MARKET
Forthnet (Retail & Wholesale) Others Cosmote
Sources: Companies’ financial results
Due to its premium content, Forthnet commands more than 40% value share in the Pay-TV market Forthnet has a strong franchise in the retail and business BB / telephony market Greece has become a 4-player market A market ripe for MVNO launches
(6/31) Estimated market data as 2019YE
31% 22% 47%
MOBILE MARKET
Vodafone Wind Cosmote
the local audience, Sports & Film TV product offering combined with a high quality telecom offering
resilience under the most adverse conditions
wholesale product for MNOs and the Universal Service provision contract
profitability through service offering enhancement (MVNO, OTT, SIZEFXISII project etc.)
significantly its performance and market position
(7/31) Company data as 2019ΥΕ
backbone network plus ULL
shop, dedicated call centers, plus independent resellers
(8/31) Company data as 2019YE
*2018 Adjusted for Forth-CRS Revenues and EBITDA in 2018
(9/31)
sale, partially offset by LLU, advertising and wholesale revenue growth
categories
capacity to compete on equal basis with other market players
12,4% reaching € 37.1m
board
3play and paytv partly offset by broadband market gains, advertising & wholesale revenue growth.
(10/31)
(In millions of €) 2019 2018 Δ Revenues 262,8 285,2
Total Retail 179,2 196,7
Total Business 47,5 49,8
Advertising 9,9 9,3 5,8% PayTV Wholesale 13,5 11,9 13,7% Other 9,9 13,8
Other income 2,8 3,6
Telecommunications costs
Royalties and licenses
Cost of sales of inventory and consumables
Advertising and promotion costs
Payroll and related costs
Sundry expenses
minus Subsidies
EBITDA (incl. IFRS 16 effect) 37,1 42,3
Depreciation and amortisation
plus Subsidies
0,9 0,9
EBIT
Net financial expenses
EBT
Taxes
2,7 4,8
Net Result
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a) Financials & KPIs b) Business Overview c) Infrastructure
(12/31)
matches of the Greek Super League Championship by concluding bilateral agreements with leading football clubs
progressing full speed with the Mobile project, working on its technical and commercial aspects, and plans to launch services during 2020
the next stages of the process
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a) Financials & KPIs b) Business Overview c) Infrastructure
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Greek banks funds to finance the acquisition of Pay TV assets. Current related debt stands at €255.0mn.
convertible bond, subscribed by its creditor banks (Piraeus, NBG, Alpha and Attica). The banks have partially converted this bond and now have a cumulative 36.2% shareholding of the company.
process of receiving offers by potential investors regarding their debt & equity exposures to the company.
that they have entered exclusive negotiations with United Group/BC Partners.
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FORTHNET SHAREHOLDERS % WIND 21.05 PIRAEUS BANK 15.11 GO PLC 14.42 MASSAR INVESTMENTS 14.42 NATIONAL BANK 12.14 ALPHA BANK 8.48 VODAFONE 4.15 ATTICA BANK 0.46 REST SHAREHOLDERS 9.77 100.00
Forthnet Convertible Bond (Issued Oct 11, 2016)
nominal value (€70.1mn) paying 1% interest maturing in Oct 2025, that can be converted quarterly to equal number of Forthnet shares, leading potentially to a total 68% stake in the company
bonds leading to a cumulative 36.2% shareholding Total Forthnet Bond Loans at €255.0mn
(16/31)
a) Financials & KPIs b) Business Overview c) Infrastructure
(17/31)
Historical Financials
(18/31)
(€mm) 2015 2016 2017 2018 2019 Total Revenues 352,0 324,7 297,1 285,2 262,8 % Growth (7,0%) (7,8%) (8,5%) (4,0%) (7,9%) EBITDA 48,2 54,8 40,2 42,3 37,1 Adjustments1 2,3
50,5 54,8 40,2 42,3 37,1 % Margin 14,3% 16,9% 13,5% 14,8% 14,1% CapEx 35,6 27,8 30,6 23,9 24,4
14,9 27,0 9,6 18,4 12,7 Memo Items: Interest Expense 19,3 16,7 13,2 12,1 11,4 Cash Taxes 0,3 0,1 1,4 0,8 0,1 Capital Structure Total Cash, incl. restricted 9,8 13,9 9,6 7,0 6,9 Bank Debt 324,8 254,9 255,0 255,0 255,0 Credit Statistics Total Debt / Adj. EBITDA 6,4x 4,6x 6,3x 6,0x 6,9x
2,6x 3,3x 3,0x 3,5x 3,3x (Adj. EBITDA - CapEx) / Interest Expense 0,8x 1,6x 0,7x 1,5x 1,1x
Historical Costs & KPI’s
(19/31)
(€mm)
2015 2016 2017 2018 2019 Total Revenues 352 325 297 285 263
50 55 40 42 37
% Margin 14% 17% 14% 15% 14%
Key Expense Metrics Telecommunication costs 96 90 83 79 77 % Growth (2%) (6%) (8%) (5%) (2%) % Total Revenues 27% 28% 28% 28% 29% Total broadband subscribers ('000) 641 582 562 550 551 % Growth (5%) (9%) (3%) (2%) 0% Telco costs / broadband subscription (€) 149 155 147 143 139 % Growth 3% 4% (5%) (3%) (2%) Royalties and licenses 92 78 77 70 65 % Growth (4%) (15%) (0%) (10%) (7%) % Total Revenues 26% 24% 26% 24% 25% Total Pay TV subscribers ('000) 495 439 417 377 342 % Growth (2%) (11%) (5%) (9%) (9%) Royalties costs / Pay TV subscription (€) 185 177 185 185 191 % Growth (2%) (5%) 5% (0%) 3% Payroll and related costs 36 36 36 34 32 % Growth (11%) 0% 0% (5%) (7%) % Total Revenues 10% 11% 12% 12% 12% Unique customers ('000) 789 720 689 669 661 % Growth (3%) (9%) (4%) (3%) (1%) Personnel costs / unique customer (€) 45 50 52 51 48 % Growth (8%) 10% 5% (2%) (6%) Total other costs 78 66 61 61 52 % Growth (8%) (15%) (8%) (1%) (14%) % Total Revenues 22% 20% 21% 21% 20%
Historical Revenues & Subscribers
(20/31)
(€mm)
2015 2016 2017 2018 2019 Total Telco Revenue 178 167 153 143 137
% Growth (8%) (7%) (8%) (6%) (4%)
Total Pay TV Revenue 154 135 119 113 101
% Growth (3%) (12%) (12%) (5%) (11%)
Other 20 23 26 29 25 Total Revenues 352 325 297 285 263
% Growth (7%) (8%) (9%) (4%) (8%)
50 55 40 42 37
% Growth (16%) 9% (27%) 5% (12%)
3Play bundled subscribers ('000) 346 302 290 259 232 Standalone broadband subscribers ('000) 294 280 272 291 319 Standalone Pay TV subscribers ('000) 148 138 127 118 110 Unique customers ('000) 789 720 689 669 661
% Growth (3%) (9%) (4%) (3%) (1%)
Revenue / customer (€) 446 451 431 427 398
% Growth (4%) 1% (4%) (1%) (7%)
64 76 58 63 56
% Growth (13%) 19% (23%) 9% (11%)
Unique customers ('000) 793 723 692 669 661 3Play bundled customers ('000) 346 302 290 259 232 Total subscriptions ('000) 1.139 1.024 982 927 893
% Growth (3%) (10%) (4%) (6%) (4%)
Revenue / subscription (€) 309 317 303 308 294
% Growth (4%) 3% (5%) 2% (4%)
44 54 41 46 42
% Growth (13%) 21% (23%) 11% (9%)
Capture the best exclusive premium content, relevant to the Greek audience Optimize the cost structure and enhance Cash Flow Provide high quality services to households, SMEs & corporate customers, and
Drive towards the future
cost to value proposition
(21/31)
58% 26% Europe average Greece Pay TV HH penetration
Company growth levers
introduction of favourable MVNO regime
base, significantly reducing churn and enhancing revenues
* Following CYTA’s absorption by VOD, currently there is no MVNO in Greece
standalone or as part of multi-play offering
value for money following the new sports content agreements, leads the market
savings in DTH transmission costs to improve profitability
Macro improvement to positively affect the 3-Play and Pay-TV market
Penetrations below EU average
19% 13% 10% 9% 9% 7% 6% 0,3% MVNOs market share in selected countries in Europe *
Source: Digital TV *Western Europe Forecasts – Digital TV Research Source: EC, Europe's Digital Progress Report 2016
*
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0,1 0,2 0,3 0,4 0,5 0,6 0,7 Greece NGA average EU NGA average
NGA as % of Broadband (>30Mbps) Pay TV evolution per technology
relate to NGA networks, despite the launch
under the DTH model
its networks and regulatory issues point
cannot practically replace DTH
largest investor by far in fiber networks, has based its Pay TV on a DTH model
Source: NRA, Companies’ financial results Source: Digital Agenda scoreboard – as 2019 H1 (23/31)
200 400 600 800 1000 1200 DTH subs IPTV subs Greece NGA Average EU NGA Average
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Cup
Top Basketball events Top European football Greek Football A’ Division
competition with the participation of PROMITHEAS PATRAS Other football & Sports Events
Exclusive agreements with the leading Greek clubs OSFP, PAO, AEK, ARIS, ASTERAS TRIPOLIS, AEL, OFI, PANIONIOS, VOLOS
(25/31)
Premium Movies and Series T
Series /
Entertainment
Sports Docs Kids Music Adult
Novalifε E! Entertainment Insight TV Novasports 24 HD Action 24 Eurosport HD Discovery Animal Planet Viasat History Travel Channel HD Boomerang HD Disney XD Nova Mad Greekζ NR1 HD Vivid Red HD Dorcel FOX, Foxlife My Zen TV Food Network HD Eurosport Eurosport 2 National Geographic HD National Geographic WILD HD Discovery HD Showcase Disney Channel Nickelodeon VH1 MTV Live HD, MTV Hits Hustler HD Redlight HD
Output deals with major Hollywood studios Awarded movies of the year, specials, tributes Top Pay TV drama series & Box Sets simulcast /very close with US premier!
Plus major Greek commercial channels & hundreds International Free to air stations
Live TV and On demand titles at any mobile device Top movies, series, docs and kids programs through STB
Upgraded STBs with connected functionalities improve customer experience, build customer loyalty and provide OTT capability
(26/31)
10% 24% 30% 34% 38% 41% 43% H2 16 H1 17 H2 17 H1 18 H2 18 H1 19 H2 19
Nova On Demand penetration
32% 33% 34% 35% 37% 38% 40% H2 16 H1 17 H2 17 H1 18 H2 18 H1 19 H2 19
Nova GO penetration
Company data as 2019YE
25% of 457K Pay TV subs comes through Pay TV wholesale in Greece and Cyprus 35% of Nova HHs choose Nova 3Play
Strong position in multi-play Expansion in wholesale
(27/31) Company data as 2019ΥΕ
48% 16% 35% Standalone Broadband Standalone Pay-TV 3Play 75% 25% Direct Pay-TV subs Wholesale Pay-TV subs
Top of mind awareness in Pay TV (%) Strong digital presence
standing for “unique entertainment experience”
GO, Nova On Demand enjoy very high image and public awareness
Source : Internal market track research by Focus Bari*, wave 12/2018
* CATI interviews among a representative sample of the total Greek population (800 people). Respondent profile: 18-64 years, decision makers / co-decision makers
millions
unique users
thousands
followers
thousands
apps installs
(28/31) Company data as 2018YE
53 53 52 50 50
34 34 37 37 38 2 2 2 2 3
DEC 16 JUN 17 DEC 17 JUN 18 DEC 18
Nova Competitor 1 Competitor 2 Competitor 3
Continuous growth Full service portfolio Trusted by the country’s largest companies
Banking Insurance Retail Industrial Shipping Hotels Public sector
Millions
(29/31) Company data as 2019YE
16% 19% 21% 22% 0% 5% 10% 15% 20% 25% 20 40 60 80 100 2016 2017 2018 2019 Business Revenue* as % of Total Revenue
* Advertising revenue not included
(30/31)
infrastructure
local exchanges
Subsystem) collects and terminates voice service
being used across the whole network
Telecom network, International Connectivity and DC technologies
Contact us: Dimitris Tzelepis, CFO ir@forthnet.gr
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