CMD 2021 Bouygues Telecom
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CAPITAL MARKETS DAY BOUYGUES TELECOM 15 JANUARY 2021 Disclaimer This presentation contains forward-looking information and statements about the Bouygues group and its businesses. Forward-looking statements may be identified by the use of words such as “will”, “expects”, “anticipates”, “future”, “intends”, “plans”, “believes”, “estimates” and similar statements. Forward-looking statements are statements that are not historical facts, and include, without limitation: financial projections, forecasts and estimates and their underlying assumptions; statements regarding plans, objectives and expectations with respect to future operations, products and services; and statements regarding future performance of the Group. Although the Group’s senior management believes that the expectations reflected in such forward- looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of the Group, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. Investors are cautioned that forward-looking statements are not guarantees of future performance and undue reliance should not be placed on such statements. The following factors, among others set out in the Group’s Universal Registration Document (Document d’enregistrement universel) in the chapter headed Risk factors (Facteurs de risques), could cause actual results to differ materially from projections: unfavourable developments affecting the French and international telecommunications, media, construction and property markets; the costs of complying with environmental, health and safety regulations and all other regulations with which Group companies are required to comply; the competitive situation on each of our markets; the impact of tax regulations and other current or future public regulations; exchange rate risks and other risks related to international activities; industrial and environmental risks; aggravated recession risks; compliance failure risks; brand or reputation risks; information systems risks; risks arising from current or future litigation. Except to the extent required by applicable law, the Bouygues group makes no undertaking to update or revise the projections, forecasts and other forward-looking statements contained in this presentation. 2 Speakers RICHARD VIEL BENOÎT TORLOTING CHRISTIAN LECOQ CEO Deputy CEO CFO 3 Capital Markets Day - 15 January 2021 01 Bouygues Telecom 25 Years Innovating to become a Star Performer 02 French Telecoms Market A New Growth Era 03 Ambition 2026 Becoming #2 in Mobile and a major player in fiber 04 Business Proven levers and new initiatives Delivering Profitable and sustainable Growth Financials 05 & Doubling Free Cash Flow 06 Conclusion The Outperforming Telco in France and in Europe 4 01 Bouygues Telecom, 25 Years Innovating to become a Star Performer 5 BOUYGUES TELECOM, 25 YEARS INNOVATING TO BECOME A STAR PERFORMER 1996-2021: 25 years innovating for our customers’ benefit 2020+ 2010-2019 Superior experience 1996-2010 Popularize connectivity 1996 Make mobile accessible to everyone st Launch 1 Smart TV virtual st 1 mobile SOWO box contract st st st 1 combining 1 mobile phone 1 fixed Android Box 2.1/3.5GhZ bundle st 1 fixed/mobile 4P st st offering 1 on handset 1 mobile phone collection plan with st fixed wireless 4G unlimited voice 1 Box #1 in Wi-Fi quality of st st Box in the market 1 mobile offer with 1 Netflix in Box “Internet” st #1 B2B customer 1 Smart CAPEX deals service 6 BOUYGUES TELECOM, 25 YEARS INNOVATING TO BECOME A STAR PERFORMER Successful strategy: delivering growth in a stagnating market Bouygues Telecom sales versus French telecom market Base 100 in 2015, total sales Change 2015-20 145 +43pts 140 135 130 125 120 115 +13pts 110 Market 105 +2pts 100 +0pt 95 90 2015 1 2016 1 2017 2018 2019 2020e 2 SOURCE: BASED ON THE TOTAL REVENUES OF THE FOUR NATIONAL TELECOM OPERATORS NOTES: (1) BEFORE IFRS 15 (2) 2020 REVENUE OF OTHER PLAYERS ESTIMATED BASED ON Q32020 STATEMENT 7 BOUYGUES TELECOM, 25 YEARS INNOVATING TO BECOME A STAR PERFORMER Successful strategy: doubling EBITDAAL1 in 5 years EBITDAAL and EBITDAAL margin in % of sales from services, in billion Euros 30.7% ~ 31% 29.7% 26.9% 23.0% Exceeding 2017 target of 25% ~€1.5bn 21.0% announced in 2015 19.6% 19.7% 17.9% €0.75bn EBITDAAL x 2 in 5 years 2012 2013 2014 2015 2016 2017 2018 2019 Consensus2020e 2020 2 NOTES: (1) IN 2015 EBITDAAL WAS EQUIVALENT TO EBITDA (2) VISIBLE ALPHA CONSENSUS ON THE 01/07/21: SALES FROM SERVICES: €4.9BN, EBITDAAL: €1.5BN 8 BOUYGUES TELECOM, 25 YEARS INNOVATING TO BECOME A STAR PERFORMER Successful strategy: +1.6m of Fixed Broadband customers Bouygues Telecom Fixed Broadband customers cumulated net growth Net Adds since end 2014 in thousands customers +1,626 +1,014 Exceeding the +1M target announced in 2015 +360 2015 2016 2017 2018 2019 Q3 2020 9 BOUYGUES TELECOM, 25 YEARS INNOVATING TO BECOME A STAR PERFORMER Successful strategy: delivering on the 2015 promise to change quadrant Sales and EBITDAAL growth of selected telecom operators1 2019 vs. 2015, Cumulated growth over 4 years Sales growth (%) 70 60 50 40 TNET 30 Bouygues BT Telecom 20 Iliad Elisa TKA Deutsche Telekom 10 Orange VOD SCMN Mtelekom Telefonica EBITDAAL growth -50 -45 -40 -35 -30 -25 -20 -15 -10 -5 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 (%) Sunrise Proximus-10 TNOR Telecom Italia TDC Bouygues -20 KPN Altice Telecom -30 2010-14 -40 SOURCES: OPERATORS, ARTHUR D. LITTLE ANALYSIS NOTE: (1) BASED ON TOTAL REVENUE REPORTED IN ANNUAL REPORTS 10 BOUYGUES TELECOM, 25 YEARS INNOVATING TO BECOME A STAR PERFORMER “Ambition 2026”, a strategic plan to accelerate growth accelerate growth Ambition 2026 French Telecoms Market New Era for Our New Plan to Growth Accelerate Growth 11 02 FRENCH TELECOMS MARKET: A New Growth Era 12 FRENCH TELECOMS MARKET: A NEW GROWTH ERA Increasing Needs for Connectivity that became vital since 2020 80% 41% of French people owned a smartphone of French Homes connected to very in 2020 (58% in 2015) high-speed internet in 2020 (20% in 2017) 10.2GB 96% monthly data consumption per user of French people consider having good Wi-Fi in 2020 (vs. 4.6GB in 2017) at Home essential SOURCES: ARCEP, MINISTRY OF ECONOMY, INTERNAL 13 FRENCH TELECOMS MARKET: A NEW GROWTH ERA Connectivity is critical for B2C and B2B Smart Health Industry 4.0 Augmented Virtual Discovery Telepresence Augmented communication Environment Automated Living Agriculture 4.0 Smart Cities 14 FRENCH TELECOMS MARKET: A NEW GROWTH ERA COVID is accelerating technology adoption +40% FTTH Net Adds in France + 1h per day spent on the Internet x1000 On average, France +40% +1 hour 2 185 3h 1 557 2h 9M 2019 9M 2020 April 2019 April 2020 COVID national lockdown SOURCES: ARCEP, MEDIAMETRIE, ARTHUR D. LITTLE ANALYSIS 15 FRENCH TELECOMS MARKET: A NEW GROWTH ERA Telecoms contributing to environmental challenges DIRECT: CONTROL OF CARBON FOOTPRINT USAGE Fixed Data Traffic 2015-19 x2 Mobile Data Traffic 2015-19 x10 SOURCES: GSMA, ARCEP, CISCO VNI, ERICSSON, ARTHUR D. LITTLE ANALYSIS 16 FRENCH TELECOMS MARKET: A NEW GROWTH ERA Telecoms contributing to environmental challenges DIRECT: CONTROL OF CARBON FOOTPRINT NEW USAGE TECHNOLOGIES Fixed Data Traffic FTTH vs. ADSL 2015-19 + kWh/line/year x2 <1/3 4G vs 3G Mobile Data Traffic & 5G vs 4G 2015-19 + kWh/GB x10 <1/3 SOURCES: GSMA, ARCEP, CISCO VNI, ERICSSON, ARTHUR D. LITTLE ANALYSIS 17 FRENCH TELECOMS MARKET: A NEW GROWTH ERA Telecoms contributing to environmental challenges DIRECT: CONTROL OF CARBON FOOTPRINT NEW CARBON USAGE TECHNOLOGIES FOOTPRINT Fixed Data Traffic FTTH vs. ADSL 2015-19 kWh/line/year + French Telco Carbon x2 <1/3 Footprint 2015-19 4G vs 3G =1 Mobile Data Traffic & 5G vs 4G 2015-19 + kWh/GB x10 <1/3 SOURCES: GSMA, ARCEP, CISCO VNI, ERICSSON, ARTHUR D. LITTLE ANALYSIS 18 FRENCH TELECOMS MARKET: A NEW GROWTH ERA Telecoms contributing to environmental challenges DIRECT: INDIRECT: CONTROL OF CARBON FOOTPRINT CO2 REDUCTION IN THE ECONOMY NEW CARBON USAGE TECHNOLOGIES FOOTPRINT Fixed Data Traffic FTTH vs. ADSL 2015-19 kWh/line/year 1g of CO eq in Telecoms + French Telco Carbon 2 Footprint x2 <1/3 helps save 2015-19 x10 CO2 eq 4G vs 3G =1 Mobile Data Traffic & 5G vs 4G in other industries 2015-19 + kWh/GB x10 <1/3 SOURCES: GSMA, ARCEP, CISCO VNI, ERICSSON, ARTHUR D. LITTLE ANALYSIS 19 FRENCH TELECOMS MARKET: A NEW GROWTH ERA French Telcos massively investing A record level of investment in Telecom infrastructure in France In billion euros, 2010-19, excluding spectrum costs 10.4 9.6 9.8 8.9 2.6 Mobile 7.8 2.8 7.4 3.0 7.3 7.3 7.1 2.7 networks 6.5 2.3 2.3 2.5 2.6 2.4 ~ 2.1 4-5bn for Fixed FTTH roll-out 7.8 7.0 networks in 2019 6.2 6.6 5.5 4.4 5.0 4.9 4.7 4.7 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Acceleration of investment with ‘Plan Très Haut Débit’1 SOURCES: ARCEP, ARTHUR D. LITTLE ANALYSIS NOTE: (1) NATIONAL HIGH BROADBAND PLAN 20 FRENCH TELECOMS MARKET: A NEW GROWTH ERA France accelerating FTTH roll-out and soon N°1 in Europe Additional FTTH roll-out in 2020 Q4 2019- Q4 2020(e), in millions of additional homes passed 4.7 4.0 1.9 1.8 0.5 Total Homes Passed / Households 70% 46% 14% 21% 85% SOURCES: FTTH COUNCIL OF EUROPE, ARTHUR D. LITTLE ANALYSIS 21 FRENCH TELECOMS MARKET: A NEW GROWTH ERA FTTH opening opportunities for gaining market share The FTTH Era The DSL Era