Grameenphone Ltd. First Quarter Michael Patrick Foley, CEO - - PowerPoint PPT Presentation

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Grameenphone Ltd. First Quarter Michael Patrick Foley, CEO - - PowerPoint PPT Presentation

Apr 04, 2024 345 likes •573 views

Grameenphone Ltd. First Quarter Michael Patrick Foley, CEO Disclaimer The following presentation is being made only to, and is only directed at, persons to whom such presentation may lawfully be communicated (relevant persons) . Any

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Grameenphone Ltd. – First Quarter

Michael Patrick Foley, CEO

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Disclaimer

The following presentation is being made only to, and is only directed at, persons to whom such presentation may lawfully be communicated (’relevant persons’). Any person who is not a relevant person should not act or rely on this presentation or any of its contents. Information in the following presentation relating to the price at which relevant investments have been bought or sold in the past or the yield on such investments cannot be relied upon as a guide to the future performance of such investments. This presentation does not constitute an offering of securities or otherwise constitute an invitation or inducement to any person to underwrite, subscribe for or otherwise acquire securities in Grameenphone

  • Ltd. The release, publication or distribution of this presentation in certain jurisdictions may be restricted by

law, and therefore persons in such jurisdictions into which this presentation is released, published or distributed should inform themselves about, and observe, such restrictions.

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Highlights 1.1 Mn new data subscribers Launch of 4G services 67.5 Mn subscribers

1Q 2018

Intense market competition

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Set to offer best 4G experience in combination of additional spectrum and neutrality

  • Same data portfolio for simplicity
  • 4G SIM replacement with free 1.5 GB
  • D2D replacement service for convenience
  • Free replacement for high value customers
  • Affordable 4G handset portfolio

1Q 2018

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Robust 4G rollout to ensure seamless experience

691 sites rollout by March 2018 4800+ sites by July 2018 All district cities under coverage

1Q 2018

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Network modernization to consolidate superior position

  • Up-gradation of all radio units
  • Re-farming & spectrum

efficiency

  • Technology neutral equipment;

Single RAN

  • Capacity enhancement with

new technology

  • Reduced power consumption
  • Lean site design with less

footprint

Coverage and experience Capacity and future readiness Efficiency and resilience

1Q 2018

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Healthy topline growth amidst continuing competitive environment

  • Prolonged winter with lower

activity during January

  • Generous data offers on 4G

SIM replacement and channel incentives

  • New subscriber acquisition offer
  • ½ paisa/second on-net offer for

BDT 21 and 49

  • Marginal drop in APPM
  • Positive results in revenue

generating base and usage

  • 3 new offers under contextual

marketing platform

  • New 1.5 GB offer at BDT 104
  • 4G SIM replacement, device and

service experience is key

Seasonality and market competition Consolidation of voice offers Competitive pressure

  • n data price

1Q 2018

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Simplification journey is a strategic priority for value creation

1Q 2018 Customer processes simplification & digitalization Simplest for B2B Self-service transformation Robust IT services

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Regulatory landscape

  • BTRC audit commenced on

3 Aug’2016

  • Received a summary of the

draft audit observations on 11 Dec'17

  • After the submission of

feedback on 18 Jan’18, a tri-party meeting was held

  • n 18 Feb’18 regarding

clarification

  • Waiting for the final
  • utcome of the report
  • On 30 Nov’17 BTRC

awarded MNP license

  • BTRC published final

process on 21 Mar’18 keeping the previous implementation deadline of 31 Mar’18 intact

  • Revised deadline agreed

with BTRC in presence of ICT adviser is 31 Jul’18

  • Fiber sub-lease option was

cancelled by BTRC due to NTTN license guideline

  • GP-BR joint committee

agreed upon an arrangement and draft agreement was sent to BTRC

  • BR will lease and GP is

entitled to 63% of revenue

  • On process of regulatory

approval

GP-Railway Fiber Contract Tower Co. licensing guideline BTRC Audit

  • Licensing guideline was

published on 1 Apr’18

  • MNOs will not be eligible to

participate

  • 4 licenses will be awarded

with application deadline of 13 May’18

  • Industry holds its existing

position on legal rights to build, maintain, operate and co-locate towers

Mobile Number Portability Services (MNPS)

1Q 2018

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Grameenphone Ltd. – First Quarter

Karl Erik Broten, CFO

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Healthy topline growth with stable EBITDA

5.7% Subscription and Traffic revenue growth* 57.6% EBITDA margin** 10.7% Capex/Sales*** BDT 4.74 Earnings per share

*Revenues generated by own subscription (excludes interconnection)

**As per IAS 18 **Capex excluding license fees; Capex/sales = moving average last 4 quarters

1Q 2018

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Changes in contracts and accounting practices

Handset Revenue

  • Prime consideration of principal versus

agent

  • Grameenphone acts as an agent while

selling handsets

  • Revenue from sale of handset is

recognized on net basis

  • Prime consideration of principal versus

agent in whole arrangement

  • Arrangement for branded content sale is

a joint operation

  • Revenue from such joint operation is

recognized on proportionate(net) basis

VAS Revenue 1Q 2018

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7.1% normalized subscription and traffic revenue growth*

  • 3.9% voice revenue growth
  • BDT 1.3 Bn lower content and device revenue

*Normalized for accounting practice changes **Daily revenues generated by own subscription (excludes interconnection)

1Q 2018

30.6 32.4 33.2 32.2 31.2 11.1% 15.5% 12.8% 8.0% 2.0%

Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

301 318 323 317 319 14.8% 18.0% 15.3% 12.4% 5.7% Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

DSTR** (BDT Mn) and Growth (YoY) Revenue (BDT Bn) and Growth (YoY)

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28% data user and 75% volume growth

1Q 2018

Active Data Users** (Mn) and % of Sub-base Data Revenue (BDT Bn) and % of Service Revenue*

  • Competitive data offers driving user growth and

customer experience

*Revenues generated by own subscription (includes interconnection) ** Minimum 150 KB usage within last 90 days

  • 23.9% data revenue growth

4.7 5.1 5.7 5.6 5.8 15.9% 16.5% 17.8% 17.9% 18.7%

Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

25.2 27.0 30.0 31.2 32.2 42.2% 43.9% 46.9% 47.7% 47.8%

Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

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621 660 754 807 851 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

ARPU (BDT) AMBPU APPMB (BDT)

6.2% service ARPU and 3.0% data ARPU drop

1Q 2018

61 63 63 60 60 0.10 0.10 0.08 0.07 0.07

Data ARPU, AMBPU and APPMB Service ARPU, AMPU and APPM

  • 6.0% service AMPU decline
  • Improving daily voice AMPU
  • 37% AMBPU growth along with 28% user growth
  • 29% APPMB decline from competitive offers

165 171 170 161 155 262 261 257 247 246 0.63 0.65 0.66 0.65 0.63 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 ARPU (BDT) AMPU APPM (BDT)

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10.1 10.0 11.0 11.0 11.6 32.8% 30.9% 33.2% 34.1% 36.9% Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

Stable EBITDA with higher investment in market

  • One off appeal deposit fee of BDT 379Mn
  • 4G related spending and higher acquisition costs
  • Normalized opex growth of 11.5%***

*EBITDA before other items

**As per IAS 18 **Normalized for appeal deposit fee and IAS 18

1Q 2018

5.0% QoQ 14.7% YoY

  • Normalized EBITDA margin of 58.8%***

17.8 19.9 19.5 19.0 18.0 58.1% 61.2% 58.7% 58.8% 57.6% Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

5.0% QoQ 1.2% YoY

EBITDA* (BDT Bn) and Margin** Opex (BDT Bn) and Margin**

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Investment mainly for network coverage and capacity

1Q 2018

*Capex (BDT Bn) and Capex/Sales%

  • Regulatory capex of BDT 17.1 Bn for 4G license,

spectrum and tech-neutrality conversion fee

  • 691 4G sites rollout after launch on 19 Feb’18
  • 303 2G and 184 3G sites addition during Q1
  • Total number of 2G and 3G sites stands at

13,297 and 12,516

  • Investment to continue to provide superior

network experience

*Capex excluding license fees

Capex/sales = moving average last 4 quarters

4.5 3.3 2.1 4.7 3.8 13.9% 12.4% 12.0% 11.3% 10.7% Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

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6.6 7.9 7.0 6.0 6.4 21.4% 24.4% 21.0% 18.5% 20.4% Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

Marginal decline in earnings

1Q 2018

Earnings Per Share (BDT)* NPAT (BDT Bn) and Margin*

  • Accelerated depreciation of BDT 519 Mn for core network modernization

7.0% QoQ 2.5% YoY

4.86 5.87 5.16 4.42 4.74 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

7.0% QoQ 2.5% YoY

*On reported basis

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BDT 14.1 Bn OCF and Net debt/EBITDA of 0.04

1Q 2018

Net debt (BDT Bn) and Net debt/EBITDA** *OCF (BDT Bn) and OCF/Sales%

*OCF equals EBITDA minus Capex on a reported basis

**Net Debt = Short term debt + Long term debt - Cash and Cash equivalents 12 months rolling EBITDA

13.3 16.6 17.5 14.3 14.1 43.4% 51.2% 52.5% 44.2% 45.2%

Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

7.6 7.3 12.2 1.8 3.4 0.11 0.10 0.16 0.02 0.04 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18

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Summary

*In consideration of the local regulations, Grameenphone Ltd. does not provide any forward looking statements.

  • Launch of 4G services with robust rollout

and modernization plan

  • Healthy topline and subscriber growth in a

competitive quarter

  • Consolidated superior network experience

and market offers to drive growth

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