Maxcom Telecomunicaciones, S.A.B.
de C.V.
Quarterly Conference Call
February 24th, 2015
2
1. Progress and perspectives of the transformation process
• 2014 progress
• 2015 perspectives
2. Presentation of 4Q14 results
3. Guidance 2015
4. Questions and answers
Agenda
1. Progress and perspectives of the transformation process
2014 Progress
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Maxcom 2014
The turnaround process has proven to be more challenging, due to the fact the
company was in worst shape than previously diagnosed.
We have introduced several iniciatives on Human Capital formation and
development. Moreover, we have restructured the executive and mid-
management team.
We have finished the design to revitalize the transimision and data networks.
The implementation itself is close to being finalized.
We have defined a new product and service portfolio for the Retail business in
order to reposition Maxcom; this portfolio is intended to satisfy our customers’
needs.
Maxcom continues to sustain a firm financial position that allows it to focus on
its transformation process.
Evaluation of the transformation initiatives during 2014
4
Maxcom 2014
The mentioned initiatives are a sample of actions executed during 2014 that
allows us to begin 2015 with a much more solid position.
Evaluation of the transformation initiatives during 2014
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1. Progress and perspectives of the transformation process
2015 Perspectives
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During 2015 our efforts will be focussed on 4 well identified iniciatives under a
favorable regulatory environment.
Maxcom 2015
7
Commercial Retail Carriers
Network, Systems and Processes
Favorable Regulatory Environment
Focus of efforts during 2015
Increased Competitiveness
We have signed agreements with the Predominant operator to use its last mile
links and its pasive infrastructure; this will enable us to expand our coverage
with Commercial customers.
We are in the final stage of defining the regulatory framework to unbundle the
local loop of the Predominant operator, this will allow us to expand our
coverage for the Retail business.
The regulatory measures are enabling us to negotiate MVNO rates that imply
approximately a 50% saving over the current rates.
Maxcom 2015
Regulatory environment
8
Network Improvements
We acquired 3 new generation Class 5 telephone exchanges to strengthen and
expand our voice services. These will be operational by April 2015.
We substantially improved the electronics of our metropolitan fiber optic
network. And by 1Q15 we will have implemented the improvements in one of
our long distance fiber routes, as well as in the data core.
We have strengthened our monitoring capabilities and are making substantial
improvements to our NOC in order to predictively and preventively manage ournetwork and services.
Maxcom 2015
Network, Systems and Processes
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Implementation of Systems and Improvement of Processes
The operation support systems and processes will be totally operative by
3Q15, including the BSS (SAP) and the OSS (Netcracker).
We have refocused the customer service systems in order to improve customer
experience.
We have redesigned the commercial processes in order to optimize “time tomarket”. The first phase will be ready in 1Q15 and the second in 3Q15.
Maxcom 2015
Network, Systems and Processes
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Churn Rate Reduction
We have an effective sales team in terms of customer acquisition. However, we
must reduce the voluntary disconnection rate.
To achieve the above we are working on correcting the 3 main idenfied causes
for churn: service flaws, billing flaws and deficient customer service.
We have, and will continue, to improve credit policies in order to increase the
quality of customers and, therefore, help reduce the involuntary disconnection
rate.
We have began to observe an improvement in the root causes of churn whichshould lead to churn reduction in the future.
Maxcom 2015
Retail
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Introduction of Higher Profitability Products
We have stopped selling low value products, improving the ARPC of new
acquisitions.
We are Up-selling and Cross-selling products to about 35% of the customer
base.
We restructured our sales team, which helped increase its productivity.
We will launch OTT products in 2Q15, which will strengthen our Retail portfolio
and allow us to sell beyond our coverage area.
Maxcom 2015
Retail
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Specialization per Segment and Increased Coverage
We have specialized the work teams, products and operations at the segment
level (midsize, corporate and government).
There has been a substantial improvement in our access capilarity through
agreements with other operators, including the Predominant operator.
During 1Q15 we will launch new products that enable us to have a more
competitive portfolio, which is in accordance to the industry, for example,
MPLS, Clean Pipe, Carrier Ethernet, and hosted IP-PBX.
Maxcom 2015
Commercial
13
Infrastructure Monetization
The modernization of our 7,255 km of fiber will enable Maxcom to possition
itself as a top player for high capacity data transport services.
We have an evident and unique opportunity for monetizing our transport
infrastructure due to the continuous increase in demand.
Derived from the lower number of players in the industry due to mergers and
acquisitions, customers will look for a healthy diversification of data transport
providers, resulting in sales opportunities for Maxcom.
Maxcom 2015
Carriers
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2. Presentation of 4Q14 results
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3. Guidance 2015
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Maxcom 2015
Guidance 2015
Items $ Million pesos
Revenues 2,700
EBITDA 620
Cash(Dec 31, 2015) 850
CAPEX (million USD) 50
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4. Q&A Session
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