4904 (twse) - fetnet
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Chee Ching, President
Sharon Lin, CFO
Far EasTone Telecom
4904 (TWSE)2020 4Q Investor Update
1
Disclaimer
This presentation contains forward-looking statements. These forward-looking statements are subject to risks, uncertainties and assumptions, some of which are beyond our control. Actual results may differ materially from those expressed or implied by these forward-looking statements. Because of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this presentation might not occur in the way we expect, or at all. You should not place undue reliance on any forward-looking information.
In preparing the information herein, FET have relied upon and assumed, without independent verification, the accuracy and completeness of all information available from public sources or which was provided to FET or which was otherwise reviewed by FET. Neither FET nor its advisors have made any representation or warranty as to the accuracy or completeness of such information and nor do they assume any undertaking to supplement such information as further information becomes available or in light of changing circumstances. None of FET, nor any of their respective affiliates, advisers or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. Neither this presentation nor any of its contents may be reproduced to a third party without the prior written consent of FET.
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I. FET 2020 Operational Performance
II. FET 2020 4Q Financial Performance
III. 2021 Guidance
IV. 2020 Dividend Distribution
Agenda
3
Mobile Market in Taiwan
29.2 29.3 29.3 29.2 29.1 29.1 29.2 29.3
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20
Total Mobile Customers in Taiwan(1)
Source: (1) Total market mobile customer data from NCC excluding NB-IoT numbers(2) Effective MNP (Mobile Number Portability) customer data from NCC
subs (mn) subs (K)
Total MNP Customers(2)
746 663
583 531 558 570
482 575
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20
iPhone12
5G launch
Saturated Mobile Service Market Number Porting Market still cold
4
419 545 565
653 704
Blended Postpaid
FETTWMCHTn/a
5,300 5,326 5,341 5,350 5,361 5,361 5,377 5,407
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20
1.5% 1.4% 1.5% 1.4% 1.3% 1.3% 1.1% 1.1%
FET Mobile Service PerformanceFET Postpaid customers grew for 9 consecutive quarters
FET Postpaid Subscribers
Record low
subs (K)
(%)
1.1%YoY
Source: (1) Operator’s ARPU (average revenue per user) from its respective factsheet. CHT’s blended ARPU was based on fair-value method while TWM &FET used residual value method.
NT$
1.0%Jan21
FET Postpaid Churn Rate
Big 3 ARPU(1) in 4Q20
5
272.2 351.5
Taiwan Average FET
260.01 315.45
Taiwan Median FET
FET 4Q20 5G Update
Source: (1) Data source from Opensignal in 4Q 2020 published on Feb. 3, 2021
FET
5G Download Speed (MBps)
FET
5G adoption continues to be strong, 95% of 5G customers signed up for rate plan>=$999
Average Monthly Fee for renewal customers has shown more than 15% uplift
4600+ 5G NRs deployed covering 61% of population island wide; target 90%+ coverage by EoY 2021
Taiwan ranked 3rd worldwide in 5G download speed(1)
FET ranked #1 in Taiwan, as per Opensignal & Speedtest (Ookla)
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Consumer Digital Services Enterprise ICT grew 17% YoY
Media services
FET 2020 New Economy PerformanceNew Economy grew 13% YoY under COVID-19
Mobile Commerce
+23% YoY +68% YoYCloud Service
+57% YoY
+34% YoY+29% YoYTelemedicineSecurity
IoT+15% YoY
Direct Carrier Billing
+11% YoY Up 20%
friDay Video monthly active users
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FET 2020 Awards and Recognitions -1
Dow Jones Sustainability World Index (DJSI) recognitions
8 Taiwan Corporate Sustainability Awards and The Most Prestigious Sustainability Awards – Top 10 Domestic Corporate
CSR Role Model Award by Global View magazine
Ranked Top 5% Corporate Governance Evaluation by Taiwan Stock Exchange
2020 BSI Sustainability Resilience Award
ESGAwards
InnovationAwards
Smart City Innovation Application Award for AIoT platform on Public Housing from Taipei City Government
Cloud IoT Innovation Award- Excellent Application Award for Sewage Cloud IoT Smart Monitoring System from CIAT(1)
Note: (1) CIAT - Cloud Computing and IoT Association in Taiwan
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9 Customer Service Excellence Awards held by Telecom Association
Best Service in Taiwan – 9 years in a row by Commercial Times
2020 Customer Service Excellence Award from TCCDA(1)
FET 2020 Awards and Recognitions -2
ServiceAwards
Enterprise MajorWins
5G mmWave Private Network with Mediatek, the world's leading 5G modem design company
5G Smart Factory with Delta Electronics and Microsoft Taiwan
5G Telemedicine Service offered in New Taipei, Taitung provinces
Deployed 80K Smart Streetlights at Taoyuan City
Deployed Smart Water Meters for Taipei City
Note: (1) TCCDA - Taiwan Contact Center Development Association
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Agenda
I. FET 2020 Operational Performance
II. FET 2020 4Q Financial Performance
III. 2021 Guidance
IV. 2020 Dividend Distribution
10
7,471 7,399 7,191 7,092 7,003 6,885 6,812 6,900
35.9% 36.2%33.7% 33.4%
36.2% 36.9% 36.6%
30.4%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20
5,000
5,500
6,000
6,500
7,000
7,500
8,000
8,500
9,000
20,819 20,425 21,407 21,214 19,389 18,675 18,630
22,807
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20
EBITDA improved QoQ in 4Q20Total Revenue regained momentum from 5G/handset sales in 4Q20
Quarterly Revenue (in NT$mn)
FET Financial Performance
Source: company data
EBITDA and Margin (in NT$mn & %)
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ItemUnit: NT$ mn, except for EPS
2020 4Q FY2020
Result GuidanceAch. Rate
%Result Guidance
Ach. Rate %
Total Revenue 22,807 24,355 93.6% 79,501 86,759 91.6%
Operating Cost & Expense 20,314 21,708
saved 6.4% 68,463 75,674
saved 9.5%
EBITDA 6,900 7,159 96.4% 27,599 27,699 99.6%
Net Income 1,885 1,869 100.8% 8,354 8,016 104.2%
EPS (NT$) $0.58 $0.57 100.8% $2.56 $2.46 104.2%
2020 4Q & Full Year Results
12
2020 4Q Financial Status
As of 2020 4QAs of 2020 3Q
Note: (1) Net Debt to EBITDA in accordance with IFRS 16; (2) Free Cash Flow excluding 5G license fees and in accordance with IFRS 16.
Cash & Cash EquivalentsAvailable-for-sale Financial Assets & Derivatives
Total BorrowingNet Debt
Shareholders’ EquityNet Debt to EBITDA(x)(1)
Free Cash Flow(2) – YTDCash-based Capex – YTD
EPS(NT$) – YTD
(NT$ mn unless otherwise stated)
5,7141,547
74,27367,012
68,2472.43x
15,18910,857
$2.56
4,1311,316
72,94967,502
66,3742.43x
13,9475,639
$1.99
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Agenda
I. FET 2020 Operational Performance
II. FET 2020 4Q Financial Performance
III. 2021 Guidance
IV. 2020 Dividend Distribution
14
ItemUnit: NT$mn, except for EPS
FY2021 Guidance
FY2020 Result YoY%
Total Revenue 82,276 79,501 3.5%
Operating Cost & Expense 72,894 68,463 6.5%
EBITDA 27,485 27,599 (0.4%)
Net Income 8,368 8,354 0.2%
EPS $2.57 $2.56 0.2%
2021 Consolidated Financial Forecast
Note: 2020-2021E financials are prepared in accordance with IFRS 15 & 16
15
9.9 8.8
7.1 6.2
10.9
14.9
2016 2017 2018 2019 2020 2021E
Source: company data
2021 Capex GuidanceHigher Capex for Peak 5G Deployment
Capex (NT$bn)
16
FET
2021
Priorities
Grow Profitable ICT business
Accelerate 5G service adoption1
2
Grow total customer value3
Control Costs & Smart Capital4
17
Agenda
I. FET 2020 4Q Operational Performance
II. FET 2020 4Q Financial Performance
III. 2021 Guidance
IV. 2020 Dividend Distribution
18
2.68 2.56
3.25 3.25
60%
70%
80%
90%
100%
110%
120%
130%
140%
150%
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
2019 2020
EPS DPSSource: company dataNote: (1) dividend distribution is subject to 2021 AGM’s approval
(1)
Proposed 2020 Dividend DistributionMaintain stable dividend
Dividend per share (NT$)
19
Q & AWebsites email
Investor Relations IR@fareastone.com.tw
http://corporate.fetnet.nethttp://www.fetnet.net
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