company update & financial highlights...high speed broadband - update 116 iptv channels todate...
TRANSCRIPT
COMPANY UPDATE & FINANCIAL HIGHLIGHTS
TM 29th AGM 8 May 2014
More than 2.2mn broadband customers in total, a growth of 7.2%
customers grew to more than 634,000, takeup rate >43%
Achieved all Headline KPI’s for 4th consecutive year
Maintained Broadband Leadership:
Headline KPI
FY2013 Achievement
Revenue growth in line with Headline KPI
6% 6.4%
Stronger Normalised EBIT Growth
3% 18.2%
Higher Customer Satisfaction Index 72 >72
2
FY 2013 Highlights
TM 29th AGM 8 May 2014
256.1%
42.1%
84.3%
249.7%
111.9%
-13.2%
47.1%
93.7%
-40.8%
-50.0%
-11.1%
TM
Axiata
Maxis
DiGi
TdC
China Telecom
SK Telecom
PCCW
Tata Comm
SK Broadband
KT
Local peers Regional peers
Note : TRS based on Gross Dividend Reinvested
* For the period 25/04/2008 – 7 May 2014
**For the period 18/11/2009 - 7 May 2014
Dividend payout of RM933.7mn for FY2013
Total Return To Shareholders Since Demerger*
TM Provides Amongst Highest Return to Shareholders
3
Source : Bloomberg
**
TM 29th AGM 8 May 2014
Financial Highlights
1,264
881 1,012 1,039
Reported PATAMI
Normalised PATAMI
2012 2013
1,187 1,150 1,372 1,359
Reported EBIT Normalised EBIT
2012 2013
9,994 10,629
2012 2013
Total Revenue
RM mn RM mn RM mn
+15.6%
Positive growth across the board
EBIT PATAMI
+18.2%
+6.4%
-19.9% +17.9%
4 TM 29th AGM 8 May 2014
2,372 2,676
2012 2013
2,205 2,512
2012 2013
Total Revenue by Product
3,706 3,618
2012 2013
Voice Data Internet
RM mn RM mn RM mn
2012
+12.8%
Non-voice Revenue now >65% of Group Revenue; Strong growth in Internet and Data revenue
Voice 37%
Data 22%
Internet 24%
Others* 17%
+13.9% -2.4%
*”Others” comprise other telco and non-telco services i.e ICT-BPO, MMU tuition fees, customer projects, Yellow Pages
Voice 34%
Data 24%
Internet 25%
Others* 17%
2013
5 TM 29th AGM 8 May 2014
4,112 3,876
237 483
2012 2013
DEL Unifi
Strong broadband growth led by Unifi, Higher ARPU
Broadband & Fixed Line customers
6
2012 2013
Streamyx Unifi
2012 2013
UniFi Residential UniFi Business
Total Broadband Customers
In thousand
In thousand
+7.2%
Fixed Line Customers
UniFi Customers
In thousand
635
+0.3%
+31.6%
4,359 4,373
2,066 2,215 483
1,580
77
406
105
530
483
1,583
635
*Call Usage Only ** Streamyx Net ARPU *** Blended ARPU
ARPU (RM) 4Q12 4Q13
Fixed Line (DEL)* 32 33
Streamyx Broadband** 81 85
UniFi*** 181 185
ARPU
TM 29th AGM 8 May 2014
7
41%
59%
31%
69%
More of our broadband customers, are now subscribing to highspeed broadband packages (4Mbps and above)
Broadband & Fixed Line customers (cont)
4Mbps and above
Below 4Mbps
2013 2012
TM 29th AGM 8 May 2014
High Speed Broadband - Update
116 IPTV Channels todate Wider HyppTV offerings: HyppTV for Business, attractive packages, Hospitality Entertainment Solution,
HyppTV over Streamyx & HyppTV Everywhere
Delivered >1.49mn premises covering 105 exchanges Activated close to 635,000 customers ~43% takeup Gross capex spent todate: RM7.4bn Smart Partnerships with property developers
Streamyx 8Mbps launched in January 2013 > 899,000, or 41% of customers on high speed
broadband (4Mbps and above)
8 TM 29th AGM 8 May 2014
9
Headline KPI
2014 2016
Revenue Growth
EBIT Growth
Customer Satisfaction Measure
5.0-5.5% 6%
5% 8%
72 72
1 Using TRiM index measuring end to end customer experience at all touch points. TRiM (Measuring, Managing and Monitoring) is a standardized indicator system. It analyzes, measures and portrays stakeholder relationships on the basis of standardized indicators. The TRI*M Index is an indicator of the status quo of a particular relationship. The index is made up of four points of view on the stakeholder relationship, e.g. for customer loyalty: overall rating, recommendation, repeat purchasing of product/services, and a company's competitive advantage. The information is based on surveys/interviews on a sample customer base.”
• Telecom Service Provider of the Year (4th time) • Broadband Service Provider of The Year (8th time) • Data Communications Service Provider of the Year (10th time) • Managed Service Provider of the Year (5th time) • Telecommunication Wholesale Service Provider of the Year • BPO Service Provider of the Year
Awards & Recognition
TM continued to receive local and international recognition
FROST & SULLIVAN MALAYSIA EXCELLENCE
AWARDS (2005-2014)
TV CONNECT INDUSTRY AWARDS 2013
• HyppTV for Best Live Online TV Service or
Solution
GLOBAL SERVICES 100 PROVIDER
• BPO Project of the Year (VADS Outsourcing Malaysia Excellence Award 2013)
NATIONAL ANNUAL CORPORATE REPORT AWARDS (NACRA) 2013
• Most Outstanding Annual Report of the Year – Platinum • Best Corporate Social Responsibility Reporting – Gold • Best Annual Report in Bahasa Melayu – Silver • Industry Excellence Award for Main Board Companies in the Trade and Service Category (won
every year since entered NACRA)
FROST & SULLIVAN ASIA PACIFIC ICT AWARDS 2013
• Fixed Broadband Service Provider of the Year
10
ASEAN Corporate Governance Index
• Best Conduct of AGM • Best ESG • Top 5 Overall Corporate Governance
TM 29th AGM 8 May 2014
MALAYSIA’S BROADBAND CHAMPION
Enabling a digital lifestyle – Life Made Easier, Business Made Easier Innovative offerings across segments with enhanced customer service Expansion of broadband services in under-served areas Complement TM’s existing suite of fixed broadband services
INFORMATION & INNOVATION EXCHANGE
Integrated ICT player for Managed Accounts Beyond Connectivity - providing more end-to-end
and value-added services, Managed Services, cloud services and BPO
Content and Applications Drive
PERFORMANCE IMPROVEMENT PROGRAM 3.0
Continued growth Fundamental productivity shift Institutional health drivers
Outlook 2014
11 TM 29th AGM 8 May 2014
Current News: Average Broadband Speed in Malaysia
TM 29th AGM 8 May 2014
TM 29th AGM 8 May 2014
Average Download Speed in Malaysia vs Broadband Penetration rate
13 TM 29th AGM 8 May 2014
Recent media report stated that Malaysia’s broadband speed is slower than neighboring countries. However the analysis did not recognize several key factors like penetration rate.
The Star, 4th May 2014 Source: Bandwidth: Net Index (Ookla) Apr 2014 Penetration: World Bank / ITU (2012)
Current News: Partnership To Develop Malaysia’s Next-Generation Converged Communications Services
TM 29th AGM 8 May 2014
TM 29th AGM 8 May 2014
• Investment Agreement signed on 27 March 2014
• Partnership and collaboration between TM, Green Packet Berhad (“Green Packet”) and SK Telecom Co., Ltd. (“SK Telecom”) to develop and offer a full-suite of converged communications services using the LTE technology platform
• RM350mn capital injection in Packet One Networks (Malaysia) Sdn Bhd (“P1”) for an estimated 57% stake
• In line with a strategy to deliver high quality and reliable data services and expand
wireless broadband capabilities
Partnership To Develop Malaysia’s Next-Generation Converged Communications Services
Key Update
15 TM 29th AGM 8 May 2014
P1, Supported By The Partnership Between TM, SK Telecom and Green Packet, Is The Ideal Platform for Us to Expand Its Capabilities…
Focus on large screen data play
2.3GHz / 2.6 GHz LTE spectrum bands
Nationwide network footprint of ~2,000 WiMax sites
~500k wireless customer base
Entrepreneurial organization and team
Leading broadband provider in Malaysia
Extensive fiber footprint
Anchor the growth and development of P1’s business
TM
Number one South Korean mobile operator in one of the most advanced LTE markets globally
Contribute valuable technical and strategic knowhow
SK Telecom
Global player in 4G devices that founded and led P1 to become a leading wireless player
Continue to lend management expertise and contribute to the LTE device ecosystem
Green Packet
16 TM 29th AGM 8 May 2014
… and Accelerate Our Vision to Become Malaysia’s Information and Innovation Exchange
Develop converged services capabilities
Strengthen core fixed business
Leverage on market opportunities
Enhance value of assets
Realise significant synergies
Establish avenues for future growth
Combined base:
~2,000 sites
Valuable spectrum assets
Extensive Fibre network
Extensive customer base: ~ 4 m fixed line of which ~ 2 m are broadband; and ~ 500k wireless customers
#1 Fixed Line
WiFi # 1 Fixed Broadband
Mobile Data IPTV
17 TM 29th AGM 8 May 2014
Overview of Proposed Partnership Framework
Capital injection by TM of RM350mn to establish a majority ~57% common shareholding in P11
Subscription by TM to an Exchangeable Bond (“EB”) Issue of up to RM210mn
Day 1 Investment by TM
TM (2) Green Packet(2)
SK Telecom
P1
~57%(3) ~30% (3) ~13% (3)
TM (2) Green Packet(2)
SK Telecom
P1
1
2
3
1
2
LTE Rollout
3 3
3
Joint Investment of up to ~RM1.65bn in Convertible Bonds (“CB”) form to fund LTE business
The primary structuring objectives are (i) to align partnership framework to create future value and (ii) establish synergistic platform to launch wireless broadband capabilities
Notes:
1 Based on equity value of P1 computed as RM750mn less net debt as agreed or determined in accordance with the terms of the Investment Agreement, at Completion
2 Respective investment vehicles for the Proposed Partnership are Mobikom Sdn Bhd, a wholly- owned subsidiary of TM; and Packet One Sdn Bhd, a wholly-owned subsidiary of Green Packet
3 Shareholding post capital injection by TM of RM350mn
18 TM 29th AGM 8 May 2014
27 March 2014 −Signing of Agreements
April – May 2014 −Respective regulatory approvals
−Green Packet Shareholder approval
3Q 2014 −Completion
19 TM 29th AGM 8 May 2014
Indicative Timeline for Completion
The proposed transaction is subject to various conditions and is expected to be completed in 3Q2014
END OF DECK
•Investor Relations • Level 11 (South Wing) • Menara TM •Jln Pantai Bharu •50672 Kuala Lumpur, Malaysia • Tel (603) 2240 4848/ 7366 / 7388