Total Access Communication Total Access Communication Total Access - - PowerPoint PPT Presentation
Total Access Communication Total Access Communication Total Access - - PowerPoint PPT Presentation
Total Access Communication Total Access Communication Total Access Communication Total Access Communication Q304 304 304 Conference Call Conference Call Conference Call Q 304 Conference Call 15 15 Nov Nov November mber 2004 2004
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Disclaimer Disclaimer Disclaimer Disclaimer
Certain forw ertain forward looking statements ard looking statements may be made in the course of the may be made in the course of the
- presentation. T
- presentation. These
hese forw
- rward-
ard- looking looking statements tatements generally generally can can be identified dentified by use use of statements tatements that hat include nclude words
- rds or
- r phrases
phrases such such as as DTAC AC or
- r its
its management management “believes,” “believes,” “expects,” “expects,” “antic “anticipates,” ipates,” “intends,” “intends,” “plans,” “plans,” “foresees,” “foresees,” or
- r
- ther
- ther words
- rds or
- r phrases
phrases of similar imilar import. Si
- mport. Similarly, statements
milarly, statements that hat describe describe DTAC’s AC’s objectives, plans
- bjectives, plans or
- r goals
goals also lso are are forw forward-l ard-looking
- oking statements. All
- statements. All such
uch forw forward-l ard-looking
- oking statem
tatements ents are are subject subject to certain ertain risks isks and and uncertainties uncertainties that that could could cause ause actual actual results results to to differ differ mat aterially erially from from those those contem
- ntemplated by
plated by the the rel relevant evant forw forward-l ard-looking
- oking statement. T
- statement. The
he forward-l
- rward-looki
- oking
ng statements contained in statements contained in the slides are not and should the slides are not and should not be constructed as representations not be constructed as representations of the future
- f the future
performance of D performance of DTAC and that such and that such statements are an expression of the statements are an expression of the Company’s revi pany’s reviews based on based on its current view its current view and certain assumptions including, and certain assumptions including, but not l but not limited to, prevailing economic ed to, prevailing economic and market conditions and and market conditions and currently currently avai available information. lable information.
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Summary Summary Summary Summary
- A significant
A significant YoY YoY growth of operating results and growth of operating results and strengthening of BS and CF continued strengthening of BS and CF continued
- Efficiency gradually improved by cost control
Efficiency gradually improved by cost control
- Intense competition remained and market growth
Intense competition remained and market growth slowed down slowed down
- Focus on service innovation, network quality
Focus on service innovation, network quality improvement improvement and distribution expansion and distribution expansion maintained maintained
- Uncertainties on regulatory issues remained
Uncertainties on regulatory issues remained
- Guidance on key operational data for
Guidance on key operational data for 2004 2004 and and 2005 2005
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Market Environment Market Environment Market Environment Market Environment
Market share of subs has been maintained @ 29% Net adds have declined for a few months due to high competition and slowdown in the market
- More intense
competition
- Continue to
maintain market share of subscriber as well as to focus
- n market share
- f revenues
Market is still growing but at a slower rate. Penetration rate was ~42% at end Q304 There were approximately 800K churned customers in the market and it has been increasing since May.
Source: Company’s estimates
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Key Strategies for Revenue Growth Key Strategies for Revenue Growth Key Strategies for Revenue Growth Key Strategies for Revenue Growth
- I. Positioning
- II. Service Innovation
Value Added Services Maximize happy 50 Bt Voucher 1 Bt Promotion Jai Dee Exchange Jai Dee Borrowing
DTAC
Innovative Friendly Value for Money
- Continue to offer innovative and friendly product and services to
meet customers’ needs and lifestyles
- Positioning on “Value for Money” is weakening due to intense
competition in the market
my Happy Go-Inter SME Corporate Solutions BABY SIM MY 3 plus 1
- III. Network Quality
- IV. Distribution Network
DTAC DTAC
Traditional telecom shops
DTAC Shops* 396
Non-Traditional telecom shops 752 Registered Independent dealers
Sales Tracking System
> 30,000 Icecream carts
* No. of DTAC shops and dealers were as of 31 Dec 03
Saha Patanapibul > 50,000 outlets ICC 3,000 Counters
Change in MGT E-Refill by end 2Q05
- 1. Continue our commitment to be best in 20 largest cities
- 2. Proactive management on CAPEX spending
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Brand Attributes Brand Attributes Brand Attributes Brand Attributes
- Discount on longer minute call
- Secretarial services
- Special discounts at shops nationwide
- Premium customer services
- Choice: selection of Happy
Times (off-peak hours) for discount rate
- Flexibility: on usage level
and budget
- Target at low volume users
who value connectivity
- Longer validity period with
standard rate per minute my 3 pl my 3 plus 1 us 1
- Launched on 19 August
2004
- For ‘my’ subscriber, make 3
calls in a day …get one free call up to 2 minutes
Maxi Maxi L Life fe
- A wide range of exclusive
services for ‘Maximize’ subscribers Happy Jai ppy Jai Dee Dee
- Introduced on June 22, 2004
- Allow prepaid subscribers using some extra-
special emergency refill of 30 baht Jai Dee Exchange Dee Exchange
- Introduced on October 6,2004
- Allow prepaid subscriber to change the
remaining days for additional call credit and vice versa Postpaid Prepaid
- Decreasing rates per minute for
every minute used after 75 bundled minutes
- Selection of billing date
- Setting usage level
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Ongoing Discussion on Regulatory Issues Ongoing Discussion on Regulatory Issues Ongoing Discussion on Regulatory Issues Ongoing Discussion on Regulatory Issues
DONE
Telecom Act Telecom Act NTC NTC Establishment tablishment Privatization Privatization
- f
- f
Regulatory Regulatory Bodies Bodies Interconnection Interconnection Concession Concession Conversion Conversion
ONGOING TOT CAT Rate Condition
Revenue Share Licensing
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Financial Highlights Financial Highlights Financial Highlights Financial Highlights
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Q Q304 304 304 304 Operating Results Operating Results Operating Results Operating Results
EBITDA grew by 2% QoQ Service Revenue increased 3% QoQ
- Prepaid airtime rev
was up due to a decrease in airtime promotion.
- VAS rev grew by
13% because of higher usage in application.
- Rev from IR also
increased by 4% since Q2 is usually the lowest season in tourism
- Operating profit of
wireless services and others increased by 1% and 10%, respectively.
- SG&A decreased
2% QoQ
- Provision for
doubtful accounts increased from Jaidee campaign
Cost of Service increased 6% QoQ SG&A was up 1% QoQ
- Selling & marketing
expenses decreased but it remained at ~6% of total revenues
- General admin exp
remained a similar level
- Provision for doubtful
accounts increase as a result of a 100% provision provided for credits offer under Jaidee campaign.
- Amort. of deferred rights
increased 7%QoQ primarily due to expansion in cellular network
- Concession fees were up
4%QoQ, slightly higher than the rev growth because of higher proportion of prepaid rev.
- Refill voucher’ s production
cost and sales margin to UD increased by 13% QoQ,
- wing to the growth in sales.
- Other operating and
maintenance expenses were also up.
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Key Drivers for A Significant Key Drivers for A Significant Key Drivers for A Significant Key Drivers for A Significant YoY YoY YoY YoY Growth Growth Growth Growth
9M04 service revenues grew 28% YoY Subscriber base continued to grow Blended ARPU gradually declined
9M03 9M04 Q304 Q204
- Prepaid revenues grew
significantly from last year and accounted for 47% at end Q204.
- Revenues from IR
increased YoY and accounted for approx. 6% of service revenues.
- Revenues from VAS
also grew; and its contribution to total service revenues increased to 5% from 4% in the previous quarter.
Breakdown of Service Revenues
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Profitability Profitability Profitability Profitability
EBITDA margin will be gradually improved in LT 9M04 EBITDA grew 33% YoY 9M04 Net Profit increased 130% YoY Highly Efficient Operator Active management of operating expenses
- Consisting of cost relating to operating network
mainly maintenance expenses, production cost of voucher cards and sales margin to UD, roaming charges to CAT and roaming partners, etc.
- Potential to gradually improve efficiency over time
Breakdown of Service Cost (Q304) as % of Service Rev Selling & Marketing expenses remained at
- approx. 6-7%.
Provision for doubtful accounts has stabilized at about 4% of postpaid revenues in Q304.
~70% EBITDA Margin if excluding regulatory cost
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Stronger Balance Sheet and Cash Flows Stronger Balance Sheet and Cash Flows Stronger Balance Sheet and Cash Flows Stronger Balance Sheet and Cash Flows
Positive cash flow will be spent on debt repayment Improvement in financial ratios Net Debt Repayment Decreasing Interest Bearing Debt net debt repayment of ~ 4-5 Billion Bt is expected for 2004
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Guidance Guidance Guidance Guidance
2004 2005 1.3 MM 1 MM
Sub Growth b Growth
Declining Declining
ARPU Trend ARPU Trend
38-39% Slight improvement
EBITDA Margin EBITDA Margin CAPEX CAPEX
7-8 Bil.Bt 6-6.5 Bil.Bt 4-6 Bil.Bt
Net Debt Repayment t Debt Repayment
4-6 Bil. Bt ~600 Mil/Quart. ~600 Mil/Quart.
Financial Cost Financial Cost
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Q Q304 304 304 304 Conference Call Conference Call Conference Call Conference Call’ ’s Participants s Participants s Participants s Participants
- Mr
Mr. .Vichai Bencharongkul Vichai Bencharongkul, Co , Co-
- CEO
CEO
- Mr
Mr. .Sigve Brekke Sigve Brekke, Co , Co-
- CEO
CEO
- Mr
Mr. .Petter Petter-
- Borre Furberg
Borre Furberg, CFO , CFO
- Mr
Mr. .Premon Pinskul Premon Pinskul, DCFO , DCFO
For further question, please contact Investor Relations Departme For further question, please contact Investor Relations Department at nt at ir ir@ @dtac dtac. .co co. .th th