third quarter 2015 - listed...
TRANSCRIPT
key highlights
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21.9m DTN subs
88% of sub base
THB7.8b data revenues
47% of service revenues ex. IC
THB7.1b EBITDA
36% EBITDA margin
THB7.6b CAPEX
39% to total revenues
THB0.72 per share dividend
138% payout ratio
operational highlights
network has improved significantly
• reached an all-time high of 93%
population coverage
• launched a nationwide campaign to
bridge perception gap
• to switch on 1800MHz LTE on
concession network to enhance 4G
offering
• continue on expansion to reach 95%
population coverage by year end 2015
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16,475 3G sites
300 4G sites
88% pop cov
23,553 3G sites
3,446 4g sites
93% pop cov
q314 Q315
cluster model is on track
• cluster model implementation progress
as planned
• expansion of distribution network into
underserved areas and along with
network coverage expansion
• ongoing personnel training and
processes optimization
5
Regions Zones Clusters
continue balancing acquisition and data monetization
• acquisition campaigns – 4G festival for postpaid
– free calls or data when purchase new SIM for prepaid
• worry-free price plans – love & roll non-stop for postpaid
– Max Net & Max Combo for prepaid
• control mechanism implemented to avoid abuses
• contextual marketing campaign to improve data monetization and upsell
6
prepaid handset subsidy sharply declined
• lower level of prepaid handset subsidy
as planned
• new generation of dtac phones
introduced
• device remains an important element
in growing data users
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Joey Jet Eagle Blade Eagle Blade
4G
Q115 Q215 Q315
-76%
no. of subsidized prepaid handset units sold
update on prepaid registration
• approx. 1.3 million prepaid subscribers
have been suspended in accordance
with regulatory requirement
• the suspension has limited impact on
revenue
• the registration requirement continues
to have impact on industry gross sale
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financial highlights
arpu and mou stabilized qoq
8.9 8.0 7.8 5.0 3.5 3.0
19.1 19.7 20.2 23.5 23.5 21.9
28.0 27.8 28.0 28.4 26.9 24.9
Q214 Q314 Q414 Q115 Q215 Q315
dtac DTN
224 218 222 215 218 220
203 197 200 195 198 204
Q214 Q314 Q414 Q115 Q215 Q315
ARPU incl. IC ARPU ex. IC
236 231 229 216 206 208
194 188 186 174 165 165
Q214 Q314 Q414 Q115 Q215 Q315
MoU incl. IC MoU ex. IC
dtac vs dtn subscribers arpu mou million subs THB/sub/month mins/sub/month
• extra prepaid churns due to end of
prepaid registration period
• postpaid sub base slightly increase
from last quarter
• MoU stabilized QoQ due to decline in
prepaid sub base
QoQ YoY
w/ IC
w/o IC
+1.2%
+3.3%
+1.2%
+3.7%
QoQ YoY
w/ IC
w/o IC
+0.9%
+0.1%
-10.0%
-12.2%
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• slight increase in ARPU both QoQ and
YoY due to decline in prepaid sub
base
9.2 8.4 8.2 7.8 7.3 7.1
6.9 7.0 7.3 7.5 7.6 7.8
1.2 1.2 1.4 1.6 1.5 1.5
17.3 16.6 16.9 16.8 16.4 16.4
Q214 Q314 Q414 Q115 Q215 Q315
voice data others
service revenues ex. ic data revenue
79% 82% 83% 85% 86% 89%
6% 6% 5% 4% 4% 3% 15% 13% 12% 11% 10% 8%
Q214 Q314 Q414 Q115 Q215 Q315
mobile internet messaging others
data revenue breakdown THB billion % of service revenues ex. IC % of vas revenues
• demand for data services remain
strong, driving proportion of data
revenues towards 50%
• nearly 90% of data revenues come
from mobile Internet
QoQ YoY
-0.2% -1.5%
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• decline in voice revenue has slowed
down
• data revenue continued to grow
service revenue stabilized QoQ
39.6% 42.3% 43.3% 44.5% 46.3% 47.5%
Q214 Q314 Q414 Q115 Q215 Q315
2.8 2.5
6.6
4.4 3.8
1.9
Q214 Q314 Q414 Q115 Q215 Q315
% smartphone handset revenue
37.2% 41.2%
48.0% 52.4%
57.1% 60.7%
Q214 Q314 Q414 Q115 Q215 Q315
handset margin
-4.9%
-18.5%
-4.3%
-17.8% -19.8% -19.1%
Q214 Q314 Q414 Q115 Q215 Q315
THB billion
• lower revenue reflected the shift
towards lower priced models and
consumers awaiting new iPhone
model
• handset margin remained stable
despite sharply lower amount of
prepaid handset subsidy
• % smartphone users continued to
rise from handset campaigns and
strong demand for data services
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smartphone penetration surpassed 60%
QoQ YoY
-50.0% -23.5%
3.9 3.6 3.6 3.1 3.1 3.1
1.2 1.2 1.3 1.2 1.4 1.2
1.0 0.9 0.9 1.1 1.2 1.1
6.1 5.7 5.8 5.4 5.7 5.4
Q214 Q314 Q414 Q115 Q215 Q315
regulatory network opex others
cost of services % cost of services THB billion % to service revenues ex. IC
22.5% 21.6% 21.2% 18.3% 18.8% 18.7%
6.8% 7.2% 7.6% 7.4% 8.8% 7.3%
Q214 Q314 Q414 Q115 Q215 Q315 regulatory costs network opex
• regulatory cost slightly
declined from previous
quarter
• reversal of accrued
expenses caused decline in
network OPEX
* excluding depreciation and amortization, and IC
*
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cos declined both QoQ and YoY
QoQ YoY
-5.0% -4.6%
% sg&a expenses
• marketing expenses slightly
declined from previous quarter
in preparation for network
campaign launch
• higher general admin from − implementation of cluster model
− expansion of dtac branded shops
− IT service fees
SG&A expenses THB billion
6.9%
7.3% 7.7%
6.0% 7.4%
7.9%
7.5%
6.9% 7.2%
7.6% 7.7%
10.7%
Q214 Q314 Q414 Q115 Q215 Q315
S&M gen admin
% to total revenues
* excluding depreciation and amortization
*
1.5 1.5 1.9
1.4 1.6 1.5 0.2
-0.1
0.3 0.2 0.2 0.2
1.6 1.4 1.8
1.7 1.7 2.1
3.4 2.9
4.1 3.3 3.5 3.9
Q214 Q314 Q414 Q115 Q215 Q315
S&M bad debt gen admin
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higher SG&A
QoQ YoY
+10.1% +33.8%
ebitda improved from sharp decline in handset subsidy
8.0 7.8
7.0 7.4
6.7 7.1
Q214 Q314 Q414 Q115 Q215 Q315
ebitda ebitda margin THB billion
36.4% 37.3%
27.7% 32.2% 30.5%
35.8%
42.4% 44.9% 39.0%
44.1% 41.0% 41.6%
Q214 Q314 Q414 Q115 Q215 Q315
EBITDA margin EBITDA margin ex handset
EBITDA margin jumped 5.3pp
from − reduction in handset subsidy,
− lower cost of services,
− partly offset by higher SG&A
expenses
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QoQ YoY
+6.1% -9.1%
1.25 1.09 0.80 0.97
0.58 0.52 3.0 2.6 1.9 2.3 1.4 1.2
Q214 Q314 Q414 Q115 Q215 Q315
net profit dividend THB per share (top)
THB billion (bottom)
THB per share
1.58 1.57 2.34
0.89 0.80 0.72
Q214 Q314 Q414 Q115 Q215 Q315
• decline in net profit as a
result of
− higher D&A charges,
− higher interest expenses, and
− higher FX loss
• 138% dividend payout ratio
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net profit declined
QoQ YoY
-10.7% -52.4%
QoQ YoY
-10.0% -54.1%
• operating cash flow turned
negative due to high level of
CAPEX
• financial ratios remained
strong
3.3 5.8
2.7 1.8 3.5 -0.6
4.6 2.0
4.4 5.5 3.2 7.6
8.0 7.8 7.0 7.4 6.7 7.1
Q214 Q314 Q414 Q115 Q215 Q315
operating CF (ebitda-capex) capex
operating cash flow key financial ratios THB billion
0.9 0.9
1.9 2.2 2.5 2.6
0.5 0.5 0.9 0.8 1.0 0.9
Q214 Q314 Q414 Q115 Q215 Q315
net debt:equity* net debt:ebitda
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solid financial position
* excluding other component of shareholders’ equity.
strategic direction and outlook
key focus areas
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network rollout and
perception improvement
distribution network expansion
and processes optimization
attractive offerings on devices
and promotion packages
network sales and distribution
subscriber acquisition
20
slightly below
2014
service revenues ex. IC
18 - 20
capex (in THB billion)
2015 outlook
EBITDA margin
31% – 33%
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.
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