Ha Half lf Yea ear r Ana naly lyst st Mee eetin ting g 20 - - PowerPoint PPT Presentation

Ha Half lf Yea ear r Ana naly lyst st Mee eetin ting g 20 2019 19

Som

• mchai

hai Le Lertsut tsutiw iwong

• ng

CEO

1

25 31 50 39 37 79 92 143 106 104 155 70 70 70 120 200 250 314 344 275 270 320 384 344 2

• AIS was late in

launching 4G

1800MHz Auction Delay

• Launch of Fixed-Speed U/L
• Additional auctions of

900/1800MHz

4G Demand Skyrocket 900MHz Concession End & 1800MHz auction

• #3 became #2
• Postpaid subsidy

Market Position Shift

2019 2016 2014 2017 2015 2018

• New license cost structure
• Risk of 2G shutdown
• Heavy handset subsidy
• AIS completed nationwide 4G

Historical 900MHz Auction

• Fully on license scheme
• 700MHz allocation at fair price
• Unwinding U/L plans

Industry re-balanced and moving toward rationalization

Monetization and 5G Preparation

Market Rationalizing

Subsidy

(Bt bn)

CAPEX (Bt bn)

Subsidy and CAPEX trending down with spectrums now fully on license & partnership basis

Bandwidth (MHz) Concession License & Partnership

3

Solid 1H19 performance with guidance maintained

• Fixed-Mobile Convergence (FMC)
• 1mn subs target
• Maintain leadership in network quality
• Continue strengthening brand perception
• Competitive in both mass market and

targeted segments

1H19 performance FY19 Guidance

Mid-single digit growth

EBITDA margin Stable from last year

Core service revenue

+4.1%

YoY

Normalized EBITDA margin

• Gain share in EDS
• Drive double-digit growth in Cloud/DC/ICT
• Explore IoT in key verticals

Business

43.7%

• Ensure operational efficiency and spending effectiveness
• Incorporate 5G capability in network plan

10 20 30 40 50 60 70 80 90 100 10 20 30 40 50 60

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 4

5G: More spreading investment outlook

CAPEX and technology cycle

4G Coverage

Bt bn

5G investment

#MHz

3G Coverage 4G Capacity 3G Capacity

2.6GHz 3.5GHz 26-28GHz

• Ensure spectrum leadership and efficient investment

14% 17% 18% 17% 18%

2000-2005 2005-2010 2010-2015 2015-2020 2020-2025

GSMA’s Global Mobile CAPEX (excl. spectrum)

as % of mobile revenue Whether 2G, 3G or 4G, the industry has kept investing 16–18% of its revenue in mobile networks – a trend expected to

continue in the 5G era.

Dependent on use cases and expect to spread out

5

Strengthen the Core

Optimize and digitize to ensure leadership and strong cash flow generation

Growing with core strength and partnership

Expand New Growth Engine

Generate new revenue and profit stream from Fixed Broadband and Enterprise while serving to strengthen and leverage core mobile business

Build new digital businesses

Build new digital capabilities and platforms to best serve future customer’s lifestyle and customer engagement Mobile Enterprise FBB Mobile Enterprise FBB Digital

2019 Revenue Mix Medium to long term

6

Focus to grow sustainably with Thais 1 3 2

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“If We All Are Network”

Pr President esident Hui i Weng ng Cheong ng

8

300 600

9

Mobile: Improving sign of monetization among usage subscribers

Postpaid

% Subscriber on fixed-speed unlimited plan

ARPU trend of new subscribers

May-18 Jun-19

ARPU trend of existing subscribers

May-18 Jun-19 Nov-18 Nov-18

Prepaid

• New subscribers

came in with improving ARPU, gearing toward volume-based plans

• Resulted in a slow

down in ARPU reduction

ARPU trend of new subscribers ARPU trend of existing subscribers

• Resulted in improving

ARPU of new subscribers

• While started to

translate into the existing base being uplifted

100 400 100 400 May-18 Jun-19 Feb-19 May-18 Jun-19 Feb-19 470 770

Jun-19 >35% Nov-18

~ 30%

Bt/month Bt/month Bt/month Bt/month

+0.4%/month +0.8%/month

• 0.5%/month

+0%/month +0.6%/month +1.4%/month

• 0.3%/month

+1.0%/month

4Q18 1Q19 2Q19

Stopped offering fixed-speed unlimited to certain segments Fully stopped offering fixed-speed UL to all new subs Gradually increased price of promotion-end subs and moved to quota-capped plans

% Subscriber on fixed-speed unlimited plan Jun-19 ~ 30% Nov-18

~ 25%

1Q19 1Q19 2Q19

Stopped offering fixed-speed unlimited to new subs Launched “quota-capped” for new & existing subs Increased price on existing subs

10

Mobile: Data grew reasonably with improving price/unit

Postpaid Prepaid

20 40 60 20 40 60

Revenue/GB Revenue/GB Data traffic (TB)

+3.3%/month

• 0.1%/month

Feb-19

Data traffic (TB)

+4.6%/month +3.2%/month

May-18 Jun-19 Feb-19 May-18 Jun-19 Feb-19 Baht Baht

• Heavy data users are pulled back to fair usage policy
• Data traffic clearly slowed down, aligning price and usage
• Slowed down in revenue per unit decline
• Revenue per unit started to be on a growing trend
• 2.8%/month

+1.8%/month

• 3.1%/month
• 1.2%/month
• 300,000

May-18 Jun-19

• 300,000

May-18 Jun-19 Feb-19

AIS’s postpaid churn trend

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22%

Postpaid Sub mix

24%

Postpaid Sub mix

89mn subs 92mn subs

+40%

Average < Jan-18 Mar-19 > < 2018 > Industry Sub Mix AIS’s blended ARPU trend AIS’s ARPU Uplift from Pre-to-Post

14% 18%

< Jan-18 Jun-19 > %segmented SIMs among prepaid subs Revenue growth

26%

< Jan-18 Jun-19 >

PREPAID TO POSTPAID CONVERSION SEGMENTED SIMS

Mobile: Continue addressing growth areas

Baht/month

CAGR

Postpaid: +10% Prepaid: -0.8% 244 263

1Q17 2Q19

1.7% 1.4%

1Q17 2Q19

• Conversion remains healthy, with postpaid churn

rate under control.

%/month

• Supported by tariff

attractiveness and handset campaigns

• Resulting in improving blended ARPU

U/L subscription

12

>2.5Mbps <2.5Mbps

15 million samples 2 million unique devices

In 2018, had

Network quality remained superior

Outnumbering and more reliable

99.4% 99.5% 99.6% 99.6% 99.7% 99.5% 97% 98% 99% 100%

Internal Drive Test

Inline with external test

OOKLA Throughput Speed Test

Awarded AIS the Fastest NW for 4 years

(Mar - May 2019)

4G Coverage

99.6% 99.6% 99.6% 99.6% 99.6% 99.6% 97% 98% 99% 100%

4G %Good Quality on LINE app

Customer Perception

Remained most preferred

45% 44% 45% 4Q18 1Q19 2Q19

% of customers conducted the survey selecting AIS Brand as a preference

Operator 2 Operator 3 Operator 2 Operator 2 Operator 3 Operator 3

13

FBB: Win with quality

Utilization rate ~ 45% 623 677 731 795

855 1,000

2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19E

FBB subscriber (‘000)

 Cross sell to mobile subscribers  Utilize salesforce in shop, Telewiz, and call-center

Focus on efficiency improvement Continue strengthening brand preference

Forward

• Network Quality Assurance

Simple

• AIS Fibre LINE Connect

Better

• AIS Fibre Guru
• Better content experience

Maintain the 1mn sub target

57 Cities

Enhance convergence strategy

FMC, 29% Non-FMC, 71%

Of 855k subscribers

ARPU 20% higher 31% 19% 19% 39% Net adds market share

2Q18 3Q18 4Q18 1Q19

+53k +54k +65k +60k

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Telecom Services ICT Services Digital Services

• Focus on turnkey

projects

• Leverage scale in

mobile and data network

• Leverage multi-

location data centers nationwide

• Partner with global

platforms to serve IaaS, PaaS, SaaS, Hybrid Cloud

• Focus on end-to-end

managed services

• Expand value chain in

selected verticals for IoT/Smart Solutions

• Leverage AIS mobile

base for digital marketing

One-Stop ICT Service Provider

Enterprise: Repositioned to be #1 service provider

15

Consumer digital services: Build engaging digital platforms

• Insurance

Mobile money

Digital Services

Video Partner platform

42mn AIS customers + Other customers

Data Analytics  Segmentation  Place the right thing at the right time  Deliver new value to customers

• Advertisement
• Games
• Games

Market analytics

• Subscription model: 2mn active subs
• Advertising model
• Joint-platform partnership
• Drive subscriber acquisition: currently 6mn registered
• Future data monetization: Advertisement / Nano finance

IoT

• Explore and

expand value chain in selected verticals

Q&A

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