vodafone telecel 2001 full year results (1 april 2001 to 31 march 2002) antónio carrapatoso, ceo...

Vodafone TelecelVodafone Telecel2001 Full Year Results2001 Full Year Results

(1 April 2001 to 31 March 2002)(1 April 2001 to 31 March 2002)

António Carrapatoso, CEO

May 2002

Total Operating Revenues 1,025.2 M. Eur.14.0%

Service Revenues 956.7 M. Eur.16.6%

EBITDA 286.1 M. Eur.13.3%

Net Income (1) 104.8 M. Eur.30.8%

Mobile Data Revenues 52.4% 49.5 M. Eur.

Annual Capital Expenditures (2) 205.4 M. Eur.36.1%

2001 vs 2000 2001 vs 2000 in Vodafone in Vodafone TelecelTelecel

(1) Includes the impact of TelecelOnline 80% sale to Vizzavi of around 19 million euros(2) Excluding the UMTS license up-front fee (100 million euros) the decrease would have been around 7.3%

Monthly Cellular Voice MOU per Registered Cellular Customer

3.0% 139

Monthly No of SMS per Cellular Regular UserCustomers who sent at least 1 SMS in the last month ~40%to 66 SMS

Cellular Net Additions 47.5% 359,215

EOP Registered Cellular Customers 14.5% 2,838,015

million minutesTotal Cellular Voice Billed Minutes 28.6% 4,435

Churn Rate 0.7 pts 23.8%

Registered Cellular Monthly ARPU 29.37 Eur.7.1%

2001 vs 2000 2001 vs 2000 in Vodafone in Vodafone TelecelTelecel

2001 in Vodafone Telecel2001 in Vodafone Telecel Conclusion of a very successful migration to the Vodafone brandConclusion of a very successful migration to the Vodafone brand Sale of TelecelOnline 80% to Vizzavi Europe GroupSale of TelecelOnline 80% to Vizzavi Europe Group Creation of Situs, together with Optimus, for the joint management Creation of Situs, together with Optimus, for the joint management

of physical telecommunications support infrastructureof physical telecommunications support infrastructure Global Quality Certification under standard NP EN ISO 9001:2000Global Quality Certification under standard NP EN ISO 9001:2000 GPRS commercial launch and pioneer introduction, in Portugal, of GPRS commercial launch and pioneer introduction, in Portugal, of

roaming GPRS servicesroaming GPRS services Pilot launch of the Multimedia Messaging Service (MMS)Pilot launch of the Multimedia Messaging Service (MMS) Exclusive launch, in Portugal, of the HSCSD technology in Mobile Exclusive launch, in Portugal, of the HSCSD technology in Mobile

InternetInternet Pioneer launch, in Portugal, of the Voice Control Voice Mail ServicePioneer launch, in Portugal, of the Voice Control Voice Mail Service

SitusSitusTelecommunications Telecommunications infrastructure sharinginfrastructure sharing Joint venture equally owned by Vodafone and Joint venture equally owned by Vodafone and

OptimusOptimus

physical telecommunications infrastructurephysical telecommunications infrastructure(towers and roof tops)(towers and roof tops)

minimisation of the environmental impactminimisation of the environmental impact of of network infrastructurenetwork infrastructure

significant savingssignificant savings in terms of investment and in terms of investment and costscosts

constructioconstructionn

managememanagement nt

operationoperation

The establishment of Situs is The establishment of Situs is especially significantespecially significant in the telecommunications industry as it in the telecommunications industry as it

associates two telecom operatorsassociates two telecom operators in an in an extremely extremely dynamic and competitive marketdynamic and competitive market

Recent Events at VRecent Events at Vodafone odafone TelecelTelecel E-mail to speech feature enables Customers to E-mail to speech feature enables Customers to

listen to e-mails on their mobile phoneslisten to e-mails on their mobile phones

Beaches Information available via SMSBeaches Information available via SMS

ExclusiveExclusive launch of MTV launch of MTV ringing tones and logosringing tones and logos

ExclusiveExclusive launch of launch of ringing tones and logos from ringing tones and logos from

the film ‘The Lord of the Rings’the film ‘The Lord of the Rings’

Recent Events at VRecent Events at Vodafone odafone TelecelTelecel Launch of several services linked to Vodafone Launch of several services linked to Vodafone

Group’s Ferrari sponsorshipGroup’s Ferrari sponsorship Portuguese operator with the highest number of Portuguese operator with the highest number of

international roaming agreements: 231 operators international roaming agreements: 231 operators in 108 countries across the five continentsin 108 countries across the five continents

Launch of Launch of Music Box Service offering customers Music Box Service offering customers the opportunity to send music messagesthe opportunity to send music messages

Launch of Vyrus-Yorn Shopping Attack Launch of Vyrus-Yorn Shopping Attack megastore, innovative in commerce, lifestyle and megastore, innovative in commerce, lifestyle and entertainmententertainment

Internet access support at the Fr. António Vieira Internet access support at the Fr. António Vieira Youth Centre in Dili, the capital of East TimorYouth Centre in Dili, the capital of East Timor

The highest weight of cellular revenues on GDP in The highest weight of cellular revenues on GDP in Europe (estimated at around 2.3% in 2001)Europe (estimated at around 2.3% in 2001)

One of the highest mobile service penetration ratesOne of the highest mobile service penetration rates- around - around 8888% in terms of registered customers (Mar 2002)% in terms of registered customers (Mar 2002)- estimated at around 79% in terms of active customers - estimated at around 79% in terms of active customers

(Mar 2002)(Mar 2002)

High and increasing weight of the cellular High and increasing weight of the cellular revenues in the Total Telecommunications revenues in the Total Telecommunications Market (it is estimated that it reached 50% Market (it is estimated that it reached 50% in 2001)in 2001)

One of the most developed

Mobile Market in PortugalMobile Market in Portugal

(1) Market estimates

Fixed Sector Fixed Sector vs Mobile Mobile Sector Sector (1)(1)

(2001) 2.72.7billion billion euroseuros

2.72.7 billion billion euroseuros

Reasons:– tariffs 10% - 15% lower than the European averagetariffs 10% - 15% lower than the European average– high handset subsidisation, especially in the high handset subsidisation, especially in the corporate corporate

segment and in pre-paid with contract segment and in pre-paid with contract – high cost of interconnection and leased lineshigh cost of interconnection and leased lines– high spectrum fees (2% of Service Revenues)high spectrum fees (2% of Service Revenues)– high network investment in relative terms (each high network investment in relative terms (each

operator with more than 2,500 base stations) and operator with more than 2,500 base stations) and respective costsrespective costs

• The EBITDA margin on service revenues’ level in The EBITDA margin on service revenues’ level in Portugal is one of the lowest in EuropePortugal is one of the lowest in Europe(~29% vs. ~35%/40%) (~29% vs. ~35%/40%)

One of the most competitive

Mobile Market in PortugalMobile Market in Portugal

The cellular revenues’ average yearly growth, from 2001 to The cellular revenues’ average yearly growth, from 2001 to 2005, will be between 6% to 10% in nominal terms2005, will be between 6% to 10% in nominal terms

The weight of the cellular market in the total The weight of the cellular market in the total telecommunications services’ market will reach 55% by telecommunications services’ market will reach 55% by 20052005

Mobile data will represent over 20% of the mobile Mobile data will represent over 20% of the mobile operators’ service revenues in 5 years (in 2001 it operators’ service revenues in 5 years (in 2001 it represented between 5% to 7%)represented between 5% to 7%)

Consolidation in the sector takes place as a result of the Consolidation in the sector takes place as a result of the Portuguese mobile market’s small dimension Portuguese mobile market’s small dimension

In maturity, the mobile service penetration rate in Portugal, in terms of users, will In maturity, the mobile service penetration rate in Portugal, in terms of users, will stabilise at around 85% in 2002 (the reported figures could be higher than 100% stabilise at around 85% in 2002 (the reported figures could be higher than 100% considering SIM cards’ multi-counting and machine to machine communications)considering SIM cards’ multi-counting and machine to machine communications)

Mobile Market in Portugal - Mobile Market in Portugal - The FutureThe Future

It is estimated that

High development of GPRS in the end of 2002 High development of GPRS in the end of 2002 and during 2003 and 2004and during 2003 and 2004

Review of the UMTS commercial launch date Review of the UMTS commercial launch date until December 2002until December 2002

Mobile Market in PortugalMobile Market in PortugalTechnological EvolutionTechnological Evolution

Progressive launching of UMTS from 2003 with Progressive launching of UMTS from 2003 with greater development in 2004 / 2005greater development in 2004 / 2005

Vodafone TelecelVodafone TelecelCellular Net AdditionsCellular Net Additions

1997

413,864

1998

625,314

1999

369,081

2000

575,628

2001

471,704

Jan-Mar2002

51,036

Quarterly Distribution[Calendar Years]

Vodafone TelecelVodafone TelecelRegistered Cellular Registered Cellular CustomersCustomers

(1) Customers who generated a chargeable event in the previous three months

2,786,979

2001

90% (1)

Active Customers

745,252

1997

1,370,566

1998

1,739,647

1999

2,315,275

2000

2,838,015

Mar2002

[Calendar Years]

1997 (1) 1998 (1) 1999 (2) 2000 (3) 2001 (3)

Vodafone TelecelVodafone TelecelCChurnhurn Rate Rate

(1) Calendar Year (period between January and December) (2) Period between January 1999 and March 2000(3) Financial Year (period between April and March)

18.8% 19.7%23.1% 23.8%

30.1%

Vodafone TelecelVodafone TelecelSubscriber Acquisition Cost Subscriber Acquisition Cost (5) (6)(5) (6) per per Gross AdditionGross Addition

(1) Calendar Year (period between January and December) (2) Period between January 1999 and March 2000(3) Financial Year (period between April and March)(4) Unaudited(5) Includes 4 components: advertising, commissions to the channels, handset subsidies and welcome package(6) Includes retention costs

175150 150

125140

1997 (1) 1998 (1) 1999 (2) 2000 (3) 2001 (3)

[EUR]

Vodafone TelecelVodafone TelecelFixed Indirect Access Fixed Indirect Access Registered CustomersRegistered Customers

43,000

Mar 2000

89,000

Mar 2001

128,000

Mar 2002

At the end of March 2002 around 80% were business

customers

Vodafone TelecelVodafone TelecelOperating and Service Operating and Service RevenuesRevenues

Service Revenues grew around 17% in the year ended March 2002 when compared with the prior

year(1) Calendar Year (period between January and December) (2) Period between January 1999 and March 2000(3) Financial Year (period between April and March)(4) Unaudited

393.1437.4

1997 (1)

540.7606.5

1998 (1)

863.9780.6

1999 (2)

820.5899.1

2000 (3)

956.71,025.2

2001 (3) (4)

[EUR Million]Service RevenuesTotal Operating Revenues

Vodafone TelecelVodafone TelecelMonthly Cellular Average Monthly Cellular Average Revenue Revenue per Registered Customer per Registered Customer (ARPU) (ARPU)

[EUR]

(1) Calendar Year (period between January and December) (2) Period between January 1999 and March 2000(3) Financial Year (period between April and March)(4) Unaudited

60.82

1997 (1)

42.57

1998 (1)

31.63

2000 (3)

32.88

1999 (2)

29.37

2001 (3) (4)

Registered Cellular Customers

Vodafone TelecelVodafone TelecelMonthly Average of Cellular Monthly Average of Cellular Voice Minutes Voice Minutes per Registered Cellular per Registered Cellular CustomerCustomer160

1997 (1)

142

1998 (1)

140

1999 (2)

135

2000 (3)

139

2001 (3)

(1) Calendar Year (period between January and December) (2) Period between January 1999 and March 2000(3) Financial Year (period between April and March)

286.1

Vodafone TelecelVodafone TelecelEBITDA and EBITDA Margin onEBITDA and EBITDA Margin onAdjusted Service Revenues Adjusted Service Revenues (*)(*)

1997 (1)

151.6

1998 (1)

204.5

1999 (2)

279.8

(*)(*) Service Revenues adjusted by Inbound InterconnectService Revenues adjusted by Inbound Interconnect

2000 (3)

252.6++13.3%13.3%

2001 (3) (4)


Quarterly Distribution[EUR Million]

40%40% 40%40% 38%38%

30%30%31%31%

1997 (1) 1998 (1) 1999 (2) 2000 (3) 2001 (3) (4)

95.3137.7

232.4

321.6

205.4

UMTS license up-front fee (100 million euros)UMTS Network

Vodafone TelecelVodafone TelecelAnnual Capital ExpendituresAnnual Capital Expenditures


23%

27%

36%

20%22%

Annual Capital Expenditures as % of Total Revenues

[EUR Million]

Vodafone TelecelVodafone TelecelDepreciationDepreciation

1997 (1) 1998 (1) 1999 (2) 2000 (3) 2001 (3) (4)

44.962.3

106.2 107.3124.1


[EUR Million]

Vodafone TelecelVodafone TelecelNet IncomeNet Income

1997 (1)

66.3

1998 (1)

96.8

1999 (2)

101.3

2000 (3)

80.1

104.8

2001 (3) (4)

+ 30.8%+ 30.8%


Quarterly Distribution[EUR Million]

Vodafone Telecel and PSI 30 Vodafone Telecel and PSI 30 Index Index Stock Price EvolutionStock Price Evolution

PSI 30

Stock Price (Eur)

Market Cap. (Eur Million)

PSI 30 Index

IPO9 Dec 96

3.97

853

2,106

30 Apr 02Var. since

IPO

8.02

1,724

3,625

102%

72%

0%

100%

200%

300%

400%

500%

600%

09-Dec-96 31-Dec-97 31-Dec-98 31-Dec-99 31-Dec-00 31-Dec-01

30-Apr-02

Vodafone Telecel

Appreciation since Vodafone Telecel IPO (1)

PSI 30 Index Companies PSI 30 Index Companies ValuationValuation

Vodafone Telecel is the second PSI 30 Index company with the highest valuation

(1) Valuation in the period from 9 December 1996 to 30 April 2001

BCP 120%Sonae Indústria 37%Vodafone Telecel102%Somague 22%

Cimpor 95%Modelo Continente19%Portugal Telecom 94%Jerónimo Martins 1%

BPI 77%Inapa 0%Semapa 77%Brisa -2%PSI 30 72%Sonae SGPS -15%

Portucel Industrial 64%Corticeira Amorim-30%BES 62%EDP -30%

Vodafone Vodafone Main Future ChallengesMain Future Challenges

Reinforcement of the competitive position in the marketConsolidation of the brand imageMaintenance of leadership position and innovation in mobile dataIncrease of the customer satisfaction levels; focus on CRMOptimisation of the cost structure

Maximisation of the Company’s value for Customers and Shareholders

Vodafone TelecelVodafone TelecelDepositary Receipt ProgramDepositary Receipt Program

Symbol:Symbol: VFELY VFELY

Ratio:Ratio: 1:1 1:1

Exchange:Exchange: OTC OTC

CUSIP:CUSIP: S192858M101 S192858M101

Settlement:Settlement: T+3 T+3

DividendsDividends11:: Paid in USD Paid in USD

Depositary Bank:Depositary Bank: The Bank of The Bank of New YorkNew York

Considered a U.S. EquityConsidered a U.S. Equity

Local Mark

et Make

r

New York Market Maker

U.S. Stock

Markets

3

OTC

DR to DR Trades

Investor

DR Issuance

Depositary Trust

Company

1 In 2000 and 1999, Vodafone Telecel’s General Assembly decided that no dividends would be distributed to its Shareholders based on the heavy investments ahead. This situation is revised on an annual basis.

4

5

2

6

7

DR Cancellation

New York Market Maker

Local Stock

Market

Local Custodi

an

Depositary

Bank

1

Vodafone TelecelVodafone Telecel2001 Full Year Results2001 Full Year Results

(1 April 2001 to 31 March 2002)(1 April 2001 to 31 March 2002)

António Carrapatoso, CEOAntónio Carrapatoso, CEO

May 2002May 2002

vodafone telecel 2001 full year results (1 april 2001 to 31 march 2002) antónio carrapatoso, ceo...

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