Roadshow Presentation Results for the first half and second - PowerPoint PPT Presentation

Roadshow Presentation Results for the first half and second quarter 2 0 1 8

Cautionary statement 'This presentation contains forward-looking statements. These forward-looking statements are usually accompanied by words such as 'believe', 'intend', 'anticipate', 'plan', 'expect' and similar expressions. Actual events may differ materially from those anticipated in these forward-looking statements as a result of a number of factors. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement. Neither A1 Telekom Austria Group nor any other person accepts any liability for any such forward- looking statements. A1 Telekom Austria Group will not update these forward-looking statements, whether due to changed factual circumstances, changes in assumptions or expectations. This presentation does not constitute a recommendation or invitation to purchase or sell securities of A1 Telekom Austria Group.‘ All figures are stated according to IAS 18 if not stated otherwise. To reflect the performance on an operational basis, the proforma figures present comparison figures for previous periods as if M&A transactions executed between the start of the comparison period and the end of the reporting period had already been fully consolidated in the relevant months of the comparison period. Alternative performance measures are used to describe the operational performance. Please therefore also refer to the financial information presented in the Consolidated Financial Statements, which do not contain proforma figures, as well as the reconciliation tables provided in the Earnings Release. Results for the first half and second quarter 2018 2

Telekom Austria share price performance Performance since 2016*: 180 TKA: +41.6% 160 ATX: +35.8% Telco: -27.9% 140 120 Performance 1-6M 2018*: 100 TKA: -7.6% 80 ATX: -4.8% 60 Telco: -11.2% Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 TKA ATX Telco S toxx Dividend for the financial (indexed from 1 January 2016) years 2018**: EURc 20 * as of 30 June 2018 ** Intended proposal to the Annual General Meeting 2019 Results for the first half and second quarter 2018 3

A1 Telekom Austria Group key facts Revenue by segment (a) Bulgaria 9.7% 59.1% Austria 9.8% Croatia 8.8% Belarus Slovenia 4.9% 5.2% 2.6% Serbia Macedonia EBITDA by segment (a) Bulgaria 9.0% 63.4% Austria Croatia 7.5% 12.6% Belarus Slovenia 2.8% 2.1% 2.7% Serbia Macedonia Notes: (a) For Full Year 2017. Breakdown does not show corporate, others and eliminations. Results for the first half and second quarter 2018 4

The leading regional communications player providing convergent telecommunication services as of 30 June 2018 (in ‘000) Austria Croatia Bulgaria Mobile m arket position # 1 Mobile m arket position # 2 Mobile m arket position: # 1 Mobile subscriber: Mobile subscriber: Mobile subscriber: 5,284 (Q2 2017: 5,364) 1,801 ( Q2 2017: 1,782)  3,974 ( Q2 2017: 4,101)   Fixed access lines: Fixed access lines: Fixed access lines: 2,086 (Q2 2017: 2,160) 294 (Q2 2017: 305)  532 ( Q2 2017: 536)   Republic of Macedonia Belarus Slovenia Republic of Serbia Mobile m arket position # 1 Mobile m arket position # 2 Mobile m arket position # 2 Mobile m arket position # 3 Mobile subscriber: Mobile subscriber: Mobile subscriber: Mobile subscriber: 1,062 (Q2 2017: 1,088) 2,173 (Q2 2017: 2,159)  4,862 (Q2 2017: 4,856) 694 (Q2 2017: 714)    Fixed access lines: Fixed access lines: Fixed access lines: 155 (Q2 2017: 144) 423 ( Q2 2017: 179) 71 (Q2 2017: 70)    Results for the first half and second quarter 2018 5

Draft for internal discussion A1 Telekom Austria Group Strategy and Equity Story Group Strategy Equity Story • Solid market position in Austria: exploiting rising demand for bandwidth and new technologies • Growth in CEE: benefiting from growing data consumption and macroeconomic recovery • Medium- to long-term growth with new business areas thanks to digitalisation • Strong balance sheet structure • Sustainable dividend policy Appropriate level of Growth and improved dividend and total efficiency shareholder return Results for the first half and second quarter 2018 6

Digitalisation is core to A1 Telekom Austria Group‘s strategy Empowering Digital Life Digitalising B2B. Digitalising B2C. Consum er Trends ROBOTI SATI ON MARKETI NG & PROCESSES AUTOMATI ON Enabling companies to translate digital potential into business results From traditional legacy platforms to cloud CUSTOMER DI GI TAL services SERVI CE PRODUCTS DI GI TALI SATI ON Results for the first half and second quarter 2018 7

Draft for internal discussion Finance strategy ensures flexibility to invest into growth opportunities Accelerated fibre roll-out in Austria Accelerated fibre roll-out in Austria • • Value-accretive M&A to Value-accretive M&A to • • Exploit growth Exploit growth unlock potential from digital transformation and unlock potential from digital transformation and • • opportunities opportunities strengthen footprint in core business (with priorities I. in- strengthen footprint in core business (with priorities I. in- • • Strong balance sheet market consolidation II. convergence III. entry into new market consolidation II. convergence III. entry into new structure markets) markets) Sustainable Sustainable Dividend level of EURc 20 with growth potential in line with • dividend policy dividend policy operational and financial performance Conservative financial profile with rating target of solid investment grade rating Results for the first half and second quarter 2018 8

Shareholder structure as of 31 December 2017 Two strong core shareholders Freefloat by nationality Rest of Europe Switzerland United Kingdom 2.7% 2.2% 1.2% Unidentified Free Float 3.5% 20.58% France United States 4.1% 34.9% Rest of World 4.3% Nordics 5.1% América Movil 51.00% Germany 20.6% ÖBIB Austria 28.42% 21.4% Results for the first half and second quarter 2018 9

Key financial Key financial developm ents for the developm ents for the first half and second first half and second quarter 2 0 1 8 quarter 2 0 1 8

Q2 2018: Sound operational trends continued with strong EBITDA contribution from CEE markets Reported Proforma Group (in EUR million) Q2 2018 Q2 2017 % change Total revenues 1,099.3 1,084.7 1.3% EBITDA 356.4 359.7 -0.9% CAPEX 168.1 171.5 -2.0% Group total revenues increased by 1.3% on a proforma basis, mainly driven by higher equipment revenues and  solid retail fixed-line performance. All markets show growing service revenues in local FX except for Slovenia. Decline in EBITDA of 0.9% but slight increase (+0.2%) on an adjusted* basis with strong contributions from CEE  markets compensating for A1 Digital investments. Additionally, the strong comparison period Q2 2017 was also positively impacted by project-driven  revenues as well as reversal of accruals and positive effects on the equipment margin in Austria.** *Adjusted figures exclude one-off and FX effects as One-off effects: EUR +2.4 mn (Q2 2017: EUR +0.4 mn) in revenues and  well as restructuring charges EUR +2.9 mn (Q2 2017: EUR +0.4 mn) in EBITDA **These factors are not considered in the adjusted FX effects: Negative EUR 12.7 mn and EUR 6.7 mn in revenues and EBITDA respectively in Q2 2018  performance. Restructuring charges: EUR 0.1 mn in Q2 2018 (EUR 0.2 mn in Q2 2017)  Results for the first half and second quarter 2018 1 1

Austria: Solid operational performance driven by retail fixed- line; EBITDA almost stable despite strong comparable Q2 2017 Operational data ARPU ARPL (in EUR) (in EUR) Postpaid subscriber base grew by 3.0% driven by ongoing high demand  Δ : +2.9% Δ : +7.2% for mobile WiFi routers and high-value tariffs 30.5 28.5 ARPU also rose due to mobile WiFi routers and increased high-value  customer share despite the drag from roaming 15.9 15.5 Higher ARPL due to fixed-line price increase in August 2017 as well as  strong demand for higher bandwidth and TV options Q2 18 Q2 17 Q2 18 Q2 17 2.1% RGU decrease mostly driven by voice; broadband RGUs year-on-  year lower almost entirely driven by the price increase Total revenues EBITDA Financial performance (in EUR mn) (in EUR mn) Total revenues increased, driven by growth in retail fixed-line and retail  mobile service revenues offsetting lower fixed-line interconnection Δ : +0.6% Δ : -0.5% OPEX increased, mainly driven by equipment costs which rose due to  651.1 647.4 more expensive handsets and higher quantities as well as product- related costs like commissions Subsidies per handset were increased to use market opportunities and  228.7 229.8 prevent churn; total subsidies increased also due to higher quantities EBITDA slightly declined by 0.5%, due to the positive impact from  project-driven revenues and reversals of accruals in Q2 2017 as well as Q2 18 Q2 17 Q2 18 Q2 17 higher subsidies in Q2 2018 Results for the first half and second quarter 2018 1 2