dtac first quarter 2008

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draft dtac third quarter 2011 21 October 2011

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Page 1: dtac First Quarter 2008

draft

dtac third quarter 2011

21 October 2011

Page 2: dtac First Quarter 2008

disclaimer Certain forward looking statements may be made in the course of the presentation.

These forward-looking statements generally can be identified by use of

statements that include words or phrases such as dtac or its management

“believes”, “expects”, “anticipates”, “intends”, “plans”, “foresees”, or other words

or phrases of similar import. Similarly, statements that describe dtac’s objectives,

plans or goals also are forward-looking statements. All such forward-looking

statements are subject to certain risks and uncertainties that could cause actual

results to differ materially from those contemplated by the relevant forward-

looking statement. The forward-looking statements contained in the slides are not

and should not be constructed as representations of the future performance of

dtac and that such statements are an expression of the Company’s reviews based

on its current view and certain assumptions including, but not limited to, prevailing

economic and market conditions and currently available information.

Page 3: dtac First Quarter 2008

key highlights

Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

Operating free cash flow of THB

5.5 billion (YTD: THB 18.4 billion)

Strong service revenue growth of

11.5% YoY

Success of 3G shown in data

revenue growth of 68.7% YoY

Page 4: dtac First Quarter 2008

highlights operational

Page 5: dtac First Quarter 2008

257 253 250 249 245 229

50 57 59 57 55 54

308 311 309 306 300 283

Q210 Q310 Q410 Q111 Q211 Q311

incoming outgoing

-9.0% -5.8%

blended MOU (mins / month / sub)

213 208 215 212 208 212

51 55 56 55 54 53

264 263 271 267 262 265

Q210 Q310 Q410 Q111 Q211 Q311

incoming outgoing

blended ARPU (THB / month / sub)

subscribers

352 296

685 725

384

136

20.6 20.9 21.6 22.3 22.7 22.9

Q210 Q310 Q410 Q111 Q211 Q311

Net add (in thousands) Accum subs (in millions)

Net adds slowed down as an

effect from seasonality and

flooding.

Higher contribution from non-

voice service

Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

5

+0.9% +1.3%

Page 6: dtac First Quarter 2008

regulatory

Page 7: dtac First Quarter 2008

Challenges on

dtac’s nationality

• Complaints regarding dtac’s violation of Foreign Business Act

(“FBA”) and Telecom Act have been filed with authorities.

• On the basis of its register of shareholders at present, dtac

believes that it is in compliance with the laws and regulations.

• dtac affirms that its customers, partners, shareholders and all

stakeholders as well as its business operations will not be

affected by the ongoing entity investigation process.

• On 22 September 2011, one of the Company’s minority

shareholders (holding 100 shares) filed a complaint against

state agencies (Ministry of Commerce, NTC acting on behalf of

NBTC and SET) with the Central Administrative Court citing that

the Company is a “foreigner” under the FBA. Therefore, the

Central Administrative Court has issued a summon requesting the

Company to be a co-defendant to this case for the interest of

justice.

7 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

Page 8: dtac First Quarter 2008

8 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

Foreign

Dominance

• NTC, acting NBTC, issued the foreign dominance notification

which became effective on 31 August 2011.

• dtac believes that the notification cannot be applied to dtac and

the existing licensees (e.g. dtac’s subsidiary, DTN).

• Also, the notification is unclear in many respects and may

contravene other legislations that have higher hierarchy of law.

• In light of these, dtac is working with new NBTC and MICT to

clear and resolve these legal uncertainties.

• dtac will keep updating on the progress of the matter.

Commercial 3G

850 MHz

• dtac obtained usage licenses for 3G 850 MHz from NBTC.

• CAT asked the Office of the Attorney General (OAG) whether the

commercial launch of 3G on 850 MHz by dtac would be in breach

of the concession contract.

• At present, the pressure against dtac’s 3G 850 MHz has been

eased with the recent OAG’s “neutral” decision.

Page 9: dtac First Quarter 2008

financial

highlights

Page 10: dtac First Quarter 2008

13,319 14,353 14,848

3,393 3,599 3,600 790 1,764 1,150 17,503

19,717 19,598 18,352

Q210 Q310 Q410 Q111 Q211 Q311

Service revenue excl IC IC Revenue

Handset & Other Reported revenue

robust YoY revenue growth

service revenue (excl IC) breakdown quarterly revenue (THB million)

10

16.5%

3.7% 4.1%

57.0%

18.8%

VAS IR

Others Prepaid airtime

Postpaid airtime

Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

Q211

14.4%

3.8% 3.9%

56.9%

21.0%

Q310

+12.0%

+6.8% reported revenue -0.6%

17.4%

3.6% 4.1%

55.9%

19.0%

Q311

Page 11: dtac First Quarter 2008

higher normalized revenue in most categories

Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

11

17,503

19,598

Tota

l nor

mal

ized

reve

nue

Q31

0

Hig

her

voic

e re

v

Hig

her

VAS

rev

Hig

her

IR

Hig

her

IDD

& O

ther

s

Hig

her

hand

set

and

star

ter

kit

sale

Hig

her

IC

Low

er o

ther

inco

me

Tota

l rev

enue

Q31

1

Page 12: dtac First Quarter 2008

1,912

2,366 2,582

14.4%

16.5% 17.4%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

-100

400

900

1,400

1,900

2,400

2,900

Q210 Q310 Q410 Q111 Q211 Q311

VAS revenue % to Service rev excl IC

40%

30%

30%

Edge/GPRS Messaging

Others

47%

25%

28%

50%

23%

27%

Q311

strong growth in non-voice service

VAS breakdown VAS revenues (THB million)

12 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

Q310 Q211

+9.1% +35.0%

Page 13: dtac First Quarter 2008

6.4% 6.1% 5.1%

5.1% 5.3% 5.3% 6.4% 6.3% 6.7%

6.4% 6.7% 6.4%

26.4% 27.3% 27.5% 27.0% 27.1% 27.5%

10.0%

15.0%

20.0%

25.0%

30.0%

Q210 Q310 Q410 Q111 Q211 Q311

Network Opex Other cost Regulartory cost

CoS well contained

% to service revenue (excl IC) cost of services (THB million) excluding amortization, IC

13 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

5,275 5,610 5,830

39.6% 39.1% 39.3%

20.00%

25.00%

30.00%

35.00%

40.00%

45.00%

0

2,000

4,000

6,000

8,000

10,000

12,000

Q210 Q310 Q410 Q111 Q211 Q311

Total % to Service rev excl IC

+10.5% +3.9%

Page 14: dtac First Quarter 2008

increasing net IC balance

normalized net IC cost (THB million)

-145 -82

142 245 238 260 320

Q110 Q210 Q310 Q410 Q111 Q211 Q311

14 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

Net IC balance increased

from high volume of on-net

traffic due to our promotion.

Page 15: dtac First Quarter 2008

higher marketing expenses from 3G launch

% to revenue SG&A (THB million) excluding amortization

15 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

2,492 2,402 2,528

14.2%

12.2% 12.9%

0

0.02

0.04

0.06

0.08

0.1

0.12

0.14

0.16

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

4000000

4500000

5000000

Q210 Q310 Q410 Q111 Q211 Q311

SG&A % to total revenue

+1.5% +5.3%

10.0% 10.5% 10.2%

8.2% 8.9% 8.6%

3.8% 3.8% 3.7%

3.4% 3.3% 4.3%

5.0% 3.7% 4.1%

2.0% 1.5% 0.3%

Q210 Q310 Q410 Q111 Q211 Q311

Admin excl A&D as % of total revenues

Selling and Marketing expenses as % of total revenues

Bad debt as % of postpaid revenues

Page 16: dtac First Quarter 2008

EBITDA and net profit growth

16 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882

net profit (THB million) EBITDA (THB million)

6,185

6,938 7,008 6,995

35.1% 34.9% 35.4%

10.00%

100.00%

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Q210 Q310 Q410 Q111 Q211 Q311

EBITDA Reported EBITDA EBITDA margin

+1.0% +13.3%

+0.2% reported EBITDA

2,530

3,026 3,073 3,061

Q210 Q310 Q410 Q111 Q211 Q311

Net profit Reported net profit

+1.6% +21.5%

+0.4% reported net profit

Page 17: dtac First Quarter 2008

healthy financial position debt repayment (THB billion) operating FCF (THB billion)

THB 27.3 billion cash on hand

financial ratios

5.0 6.1

5.0 6.9 6.0 5.5

1.0 0.9

1.6

0.3 0.9 1.5

Q210 Q310 Q410 Q111 Q211 Q311

Operating FCF (EBITDA - Capex) Capex

93.1 95.2

163.8 179.8 193.8

244.4

21.2 26.6 27.2 32.9 39.9 51.4

Q210* Q310* Q410* Q111* Q211* Q311*

Net debt to

EBITDA

Net debt to

Equity

FFO to Total

Debt (%)

Interest

Coverage Ratio

* Net cash 17

8.2

3.0

0.7 0.7 0.7 3.3

Q211 Q311 Q411 H112 H212 2013-

2015

Interest Bearing Debt Repayment

Page 18: dtac First Quarter 2008

outlook

2011

Page 19: dtac First Quarter 2008

Free cash flow

Revenue growth

Approx. THB 20.0 billion CAPEX at THB 5.5 – 6.0 billion

High single digit

4.5 – 5.5 million net adds for the industry. Maintain sub market share, but Quality of sub is more important.

Net adds

19 Investor Relations: www.dtac.co.th

E-mail: [email protected]

Tel: 662 202 8882