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www.globaltower.com.tr GLOBAL TOWER AT A GLANCE Established in 2006 - - PowerPoint PPT Presentation
www.globaltower.com.tr GLOBAL TOWER AT A GLANCE Established in 2006 - - PowerPoint PPT Presentation
Aydnevler Mahallesi No:20 Kkyal Ofis Park Maltepe, stanbul Tel:0850 229 78 00 Fax: 0216 376 58 53 www.globaltower.com.tr GLOBAL TOWER AT A GLANCE Established in 2006 as 100% subsidiary of Turkcell as Pioneer of infrastructure
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Global Tower is the first and only standalone towerco in Turkey and one of the largest standalone towerco in Europe GLOBAL TOWER AT A GLANCE
Established in 2006 as 100% subsidiary of Turkcell as Pioneer of infrastructure sharing Serves not only MNOs, but also broadcasters, ISPs, energy & public institutions In 2008, our subsidiary UkrTower has become Ukraine’s sole independent towerco In 2016, our subsidiary BelTower was established as Belarus’s sole independent towerco With its more than 10.000 unique portfolio of sites in Turkey, Ukraine, Belarus and Turkish Republic of Northern Cyprus, Global Tower became a regional player
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2.376
TURKEY
Managed Sites
3.471
TURKEY
Fully Owned
2.220
TURKEY
Contract Management
1.187
UKRAINE
Fully Owned
830
BELARUS
Right of Use/ Sublease
115
Turkish Republic of Northern CYPRUS
Right of Use
SCOPE FOR EXPANSION BOTH IN AND OUT OF EXISTING MARKETS GLOBAL TOWER BUSINESS MODEL
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1st in Turkey Tower Co 5th in Europe Tower Co 15th in Global Tower Co
With its more than 10.000 unique portfolio of sites in four countries
TURKEY
TURKISH REPUBLIC OF NORTHERN
CYPRUS UKRAINE BELARUS
Core Business
Buy&Lease Back Built to Suite Colocation Contract Management Passive & Active Maintenance Energy Solutions Site Search & Acquisition Site Inspection & Monitoring
Additional Services
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- Ground lease contract management services to MNOs
Services Tower Rental Description
Build and Sale
- f Towers
Contract Management Maintenance Services Other
- MNOs, ISPs, Radio&TV broadcasters, administrative bodies & ISPs
- Only standalone licensed tower operator in Turkey and Ukraine
- Largest contributor to Global Tower’s revenues
- Tower infrastructure to MNOs, service integrators and technology service providers
- Site search & acquisition
- Technical & administrative services to launch new sites on a turn-key basis
- Maintenance services for MNOs, broadcasters periodically
- Tower dismantling services to MNOs for the towers in its portfolio
- Supply of active equipment for Radio&TV broadcasters
- Supply of energy infrastructure systems for the MNOs
- Tower inspection & reinforcement
Engineering Services
WHAT WE OFFER? OUR PORTFOLIO BY PRODUCT TYPE
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Tower Portfolio Consisting Purely of Greenfield Sites
Lattice Towers Monopole Towers Totem Towers Mobile Towers Wind Towers
Height Between 10 and 100 meters, with an average height of 52 metres Antenna Capacity Between 5m2 and 35m2 Height Between 6 and 42 meters, with an average height of 28 metres Antenna Capacity Between 3m2 and 25m2 Height Between 10 and 42 meters, with an average height of 20 metres Antenna Capacity Between 3m2 and 25m2 Height Between 6 and 36 meters, with an average height of 25 metres Antenna Capacity Between 2m2 and 6m2 Height Developed as free standing towers, carrying measuring instruments and meteorological instruments
Innovative Products Camouflage Products
Clock Towers Flag Post Towers Palm Tree Towers Totem Towers
Telescopic Tower Atlas Tower Composite Tower Res Tower Water Based Tower Atlas & Spinning Wheel Tower with Safety Catch MultiRoom Shelter Portable Cat Walkaway
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TOWER INFRASTRUCTURE ELEMENTS ATTRACTIVE MACROECONOMIC FUNDAMENTALS AND DEMOGRAPHICS
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Infrastructure Components Ownership
Component Tower Anten Apparatus Antenna Generator Concrete Area Shelter Room Energy Line Feeder Cable Global Tower Customer 1 2 3 4 5 6 GE TR GB FR IT ES RO BE GR CZ HU SE
82 79 64 64 60 46 20 11 11 11 10 10 Second Largest Population in Europe
Population 2016A (m)
Turkey Romania Serbia Hungary Spain Germany France Austria Italy Czech Republic United Kingdom
3.8% 3.7% 3.4% 2.3% 2.3% 2.2% 1.4% 1.3% 1.3% 0.9% 0.4% One of the most Fastest GDP Growths in Europe
Average Real GDP Growth 16E-19E
Predominantly Young
<25 years 25-50 years >50 years
27% 34% 39% 38% 36% 26% 37% 21% 42%
Turkey WE CEE
Underpinning Attrectiveness of Global Tower’s Core Market
GDP per Capita (Thousands of US$ at PPP)
20,6 17,3 11,0 6,1 55,8 35,9 34,5
Turkey Mexico Indonesia India US Italy Spain
Sources: Euromonitor, EIU, CIA World Factbook, Geohive.
(%, 2016A) 1 2 3 4 5 6
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SIZABLE AND ATTRACTIVE TELECOM MARKET: EXPANDING SUBSCRIBER BASE
INCREASING USAGE
SIZABLE AND ATTRACTIVE TELECOM MARKET:
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Turkey Average WE Average CEE
(2) (3)
74 34 24 Large Subscriber Base (1)
Turkey Average WE Average CEE
(2) (3)
5.0 2.8 1.2 Expected to Grow at a fast Pace As Mobile Market is Substantially Underpenetrated 78% 86% 94% 109% 125% 134% 138% 131% 136%
India Mexico Spain USA Indonesia Italy Total WE Total CEE Turkey
Low penetration with no competing TowerCo
(2) (3)
Mobile Penetration (as % Population, FY16A) Mobile Subscribers (2016A, m) Total Subscribers Net Adds (2016A-2019E,m)
Proliferation of Advanced Mobile Devices...
Average Data Usage per Device (2016A, MB/Month Data Consumption)
31 1.500 2.700 5.800
x50 x90 x190
Feature Phone SmartPhone Tablet LapTop
...to Boost Mobile Data Traffic...
(GB/Month per Sub) 2013A 2016A 2020E
0,5
x2,4 X5,5
1,3 7,1
7,2 7,7 1,9
(%0,1) %1,0
16E-19E CAGR
%3,7
...are Expected to Translate into Sustainable Mobile Revenue Growth
(GB/Month per Sub) Turkey WE CEE
(2) (3)
330 399 560
... which Coupled with Increasing Mobile Voice Traffic...
(Minutes of Use/Month)) 2013A 2016A 202E
+20% +40%
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20.0 20.0 35.0 40.0 24.8 20.0 20.0 70.0 30.0 35.0 20.0 24.8 59.6 70.0 60.0
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TURKEY: LTE SPECTRUM AUCTION COMPLETED IN 2015 TURKEY’S TELECOM NETWORK DESIGN REQUIRES HIGHER DENSIFICATION
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Limited bandwidth in a key frequency providing capacity (1800MHz) results in high demand for tower space to meet the expected surge in data traffic
2600 MHz
4.5G capacity boost layer for hot spots Main layer for 4.5G Terminal support, capacity and coverage layer 2G/3G coverage and voice layer 4.5G main coverage layer Mobile broadband layer for 3G 4.5G usage for mid/long-term
2100 MHz 1800 MHz 900 MHz 800 MHz Capacity Capacity Coverage Coverage Traditional Network Design
(Voice + Some Data)
- Traditional network topology designed to ensure
high quality voice services
- Unable to adequally handle exponential growth in
the demand for traffic
Densified Network Design
(High Data Traffic)
- Higher network density required, especially in urban areas
- Smartphone penetration leading to growth of data hungry applications
- Anticipated VoLTE (Voice over LTE) adoption
Network densification on the back of limited availability of spectrum Regulatory framework enforcing passive infrastructure sharing Expected to boost increase in colocation
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COVERAGE OBLIGATIONS TO RESULT IN A HIGHER DEMAND PER TOWER SPACE PREMIER ESTABLISHED TELECOM INFRASTRUCTURE OPERATOR
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Licensing Date >50% of Country Population >90% of Country Population
2G Implication 3G LTE
1998 2001
3 Years 2 Years
2003
3 Years 3 Years 2 Years 2 Years Licensing Date Metropolitan Municipalities (~77% of Population) All Province/ District Municipalities (~93% of Population)
2009 2012 2015
Rural Areas with >5k Population
2017
Rural Areas with >1k Population
2019
- No residual obligation
- Coverage not a competitive
advantage
- Opportunity for POP
consolidation
- Rural/low density coverage
remain as part of obligation
- Opportunity for tower
business
- Rollout starting from higher
density zones
- Small cell/DAS opportunities
for indoor coverage
- Infrastructure coverage
requirement necessitating POP deployment
3 Years 3 Years 2 Years 2 Years Licensing Date 99% of Highways, Tunnels, High Speed Railroads 95% of All Double Roads
2016 2019 2022
90% of All Conven-tional Railroads
2024
95% of Country Population, >90% of All Province/Districts 95% of Country Population, >90% of All Province/Districts
Areas Covered with LTE are Regarded as Covered with 3G
15th Largest Standalone Global TowerCo
(No. of towers)
5th Largest Standalone Tower Operator in Europe
(No. of towers)
Largest and Only Standalone Tower Operator in Turkey
(No. of towers)
144.000 40.000 29.432 25.670 23.493 16.776 16.450 15.135 14.737 12.874 12.138 11.519 11.154 10.550 10.140 8.400 7.770 7.070 6.966 6.556
15th Largest TowerCo Globally DiF
15.135 13.893 11.519 10.550 10.140 6.966 2.618
15th Largest TowerCo Globally Owned Towers Managed with right to sub-lease Managed without the right to sub-lease
6.000 7.994 5.500 1.300 3.393 2.388 2.213
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FINANCIAL OUTLOOK: FINANCIAL OUTLOOK:
14 (1)
KEY INDICATORS CASH FLOW CONVERSION Cash Flow Conversion 2016
(EBITDA - CAPEX )/ EBITDA
91.7% 61.3% 79.7% 80.5% 96.6% 97.0% 23.1% 37.2% 55.4% 62.9% 81.1% Developed Markets Emerging Markets
REVENUE GROWTH 32% 41% 52% 18% 22% Zero debt & unleveraged balance sheet
Global Tower has dividend distribution policy with 75% payout ratio
11%
- ADJ. EBITDA
MARGIN(*) NET INCOME MARGIN BALANCE SHEET
2015 2016 Revenues TL/mn
Rental Non-Rental
2015 2016
251 50 331 201 56 275 Revenues TL/mn
Turkey Ukraine
92% 8%
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GLOBAL TOWER’S STRATEGY TO FOCUS ON VALUE MAXIMISATION GLOBAL TOWER OFFERS COMPELLING BENEFITS TO ITS CUSTOMERS
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Global Tower Provides a Fully Outsourced Infrastructure Solution for Wireless Operators 1 Tenant % of Approximate Site Capex
Active Equipment Passive Equipment
Multiple Tenants Compelling TowerCo Model Benefits Global Tower’s Customer
Reduced Capex Focused on Improving Profitability and Cash Flow Conversion
Increasing Tenancy & Land ownership M&A Network Expansion and managed-to-owned conversion
Continued Organic Expansion of the Tower Portfolio Selective and Disciplined Inorganic Growth Outsourcing of Non-core Operations Short Time to Market Increased Efficiency
Highly experienced management team with strong industry know how, Regional leader in the tower infrastructure sector with vision to become a global company Strong cash flow generation capacity to support targeted growth and shareholder value maximization
Colocation provides significant reductions in capital costs to MNOs Allows MNOs to focus on their main activities Flexibility for MNOs to expand / increase capacity in a short time frame Dedicated operator able to maintain sites 1/3 2/3
Outsourced to TowerCo
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INCREASE IN COLOCATION: OUR COMPETITIVE ADVANTAGE
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TANGIBLE ECONOMIC BENEFITS
Growing Industry Strong Financials Visibility
Growing & profitable sector Sizeable and attractive telecom market Further growth in mobile data and coverage obligations Increasing coverage, particularly for LTE, as well as usage of higher frequencies, which drive the requirement of additional POPs, are expected to create an additional POP demand of around 3k by 2025 Higher network density required, not only in urban areas but also in less populated zones Gradual decrease of POP reutilisation expected to lead to higher POP requirement Formation of standalone Tower Co. to accelerate the proportion
- f passive infrastructure sharing
Global Tower to benefit from increasing demand for tower space given size and premium location of tower assets Solid cash flow generation; cash flow conversion close to 1 High operating leverage; EBITDA margin above 50% Attractive dividend policy; 75% dividend payout ratio Unleveraged balance sheet with zero debt High revenue visibility &long-term contractual relations Strong & credible customers with secured revenue growth
Significant Expected Demand for Tower Space… … Mainly Satisfied by Collocation on Existing Towers
Comparison of Collocation vs. Build-to-Suit
2G
Upfront Investment
TRY 77 - TRY 119K TRY 19K
- c. TRY 12K
2 Weeks 2-3 Months In Place All Equipment Operational Immediately at SLA Equipment Needs to be Purchased Ramp-up Period to Reach SLA To be Obtained
(1)
- Annual
Opex Time to Live Status Permits Power Management Quality
- f Services
Collocation Build-to-Suit
Sources: Arthur D. Little Turkish Tower Report and Market Model, Company information. Notes: (1) Range for material and installation costs of Global Tower assets (including lattice, monopole, totem and mobile towers; excluding ecotowers).
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EXPERIENCED TOP MANAGEMENT TEAM
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CEO of Global Tower since 2016 MBA from Middlesex University Commenced work at Ata Invest as a telecom analyst in 1996 Joined Turkcell in 2000 as a Senior Specialist at the Investor Relations division until 2004 Investor Relations and M&A Director from 2009-2016
CFO of Global Tower since 2016 Joined Turkcell in 2013 as the Financial Advisor to the chairman and the board of directors Started working at Pricewaterhouse Coopers’s assurance department in 2006., incl. 1 year in the US Certified public accountant and licensed independent auditor in Turkey Chief Strategy and Investor Relations Officer of Global Tower since 2016 Served as Vice President at the UK and Northern Ireland Representative
- f the Turkish Prime Ministry‘s
Investment Support and Promotion Agency. Served as the Board Member of Ari Teknokent at Istanbul Technical University between 2012 and 2015 Telco Services Sales Director of Global Tower as of August 2016 Joined Global Tower in 2013 as Telco Services Sales Manager Radio Network and Site Acquisition Manager of Turkcell between 2008-2013 Joined Turkcell’s Radio Network and Site Acquisition unit in 2006 Non-Telco Services Sales and Business Development Director of Global Tower since 2016 Non-Telco Services Sales Manager from 2012 to 2016 Joined Global Tower in 2007 and served as Turkey Site Acquisition and Business Development Manager as well as UkrTower Manager till 2012 Held several managerial positions at Turkcell between 2000-2007
Nihat NARİN
CEO
Hıfzullah ÖZKAYA
CFO
- Dr. Hüseyin Aslan