Proximus Company Presentation - March 2019
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Proximus Company Presentation March 2019
2
Who we are…
Our high-quality We are investing in future- We put the customer at We contribute to the
Proximus is a interconnected fixed and proof networks and the heart of everything we economic, social and
telecommunications mobile networks offer innovative solutions, do. Our aim is to deliver the environmental
company operating in the access anywhere and creating the foundations for best customer experience development of the
Belgian and international anytime to digital services sustainable growth. and to simplify the society in which we
markets. We are the and data, as well as to a customer journey by operate.
leading national provider broad offering of offering accessible and
of telephony, internet, multimedia content. easy to use solutions.
television and network-
based ICT services.
3
Proximus Group: an established company with long
history
LAUNCH 4.5G
FIBER FOR BELGIUM Proximus first operator to
1998 Announcement end-2016 launch 4.5G in Belgium
(FTTH & FTTBus)
FON PARTNERSHIP BICS
LIBERALISATION Belgacom signs a partnership with 2017
FON, the largest Wi-Fi community
AQUIRES
ADSL BELGIAN TELCO in the world. TELESIGN
MARKET Proximus Group
LAUNCH of ADSL 2010
subsidiary
2008 2011 BICS completes the
2016
CHANGE TO acquisition
of TeleSign in
START OF FTTC PROXIMUS Nov.17
ACQUISITION
ROLL OUT Company name change
SCARLET & TANGO from Belgacom to
Belgacom launches commercial Proximus, effective as of
100% MOBILE OWNERSHIP 2007 services on the VDSL2 network, TV EVERYWHERE 22 June 2015, shares
Belgacom acquires the remaining 25% stake acquires Scarlet NV to penetrate the listed under ticker
Watch Belgacom TV on any
in Proximus from Vodafone, enabling a full low-cost market segment. “PROX”.
2012 device (tv, pc, tablet,
fixed-mobile convergence strategy. Belgacom acquires Tango, the smartphone) via Wi-Fi and
leading alternative operator active 3G. 2018
MOBILE INTERNET in Luxembourg and Liechtenstein. ACQUISITION
2002 2015 OF
Proximus first mobile operator 4G LAUNCH
offering Internet access via GPRS. ACQUISITION Launch of the first 4G-network SMALL-SIZED
2006
TELINDUS in Belgium and Tango in Luxembourg. HIGHLY
Belgacom acquires Telindus, a SPECIALIZED
2003 group of companies offering
IPO network-based ICT solutions, 2014 IT
Belgacom on Euronext stock catering to the needs of COMPANIES
market at €24.5, biggest IPO in professionals and the public
Europe since 2001 and biggest sector.
IPO ever in Brussels.
FIRST TO OFFER DIGITAL TV NEW CEO FIT FOR
& 3G SERVICES GROWTH STRATEGY
2004 2005 Dominique Leroy appointed
Belgacom TV, the first Digital TV offer on the
Belgian market. as CEO for a six-year term.
Proximus first mobile operator in Belgium to
offer 3G services to the general public.
4
Shareholder structure
Total number of shares Free-float Belgian Government
338,025,135 42% 54%
Number of % shares % Voting % Dividend Number of Number of
shares rights rights shares with shares with
voting rights dividend rights
~€ 8Bn
Market Capitalisation*
Belgian state 180,887,569 53.51% 56.05% 55.91% 180,887,569 180,887,569
Proximus own
15,321,318 4.53% 0.25% 820,036
shares
Free-float 141,816,248 41.95% 43.95% 43.83% 141,816,248 141,816,248 ~ 6%
Dividend yield*
Total 338,025,135 100.00% 100.00% 100.00% 322,703,817 323,523,853
*26/03/19
The voting rights of the treasury shares are suspended by law. The dividend rights of the treasury shares acquired in 2004 are also suspended,
whereas the dividend rights for shares acquired as from 2005 are cancelled.
Transparency declarations: According to Proximus’ bylaws, the thresholds as from which a shareholding needs to be
disclosed have been set at 3% and 7.5%, in addition to the legal thresholds of 5% and each multiple of 5%.
5
Our governance model
Board of Directors
Martin De Prycker (2) Pierre Demuelenaere (2) Guido J.M. Demuynck (2) Karel De Gucht (1) Martine Durez (1) Tanuja Randery (2)
Director Director Director Director Director Director
until AGM 2019 until AGM 2021 until AGM 2019 until 25/09/2021 until 27/09/2019 until AGM 2020
Dominique Leroy (1) Stefaan De Clerck (1)
Chief Executive Officer Chairman
until 13/01/2020 until 20/09/2019
We are currently a public limited liability company under Belgian
public law. For matters not otherwise explicitly regulated,
Proximus is governed by the Belgian corporate law and the 2009
Belgian Corporate Governance Code. Laurent Levaux (1) Isabelle Santens (1) Agnès Touraine (2) Paul Van de Perre (1) Catherine Vandenborre (2) Luc Van den hove (2)
The Board of Directors defines the company’s general policy and Director Director Director Director Director Director
strategy, supervises operational management and ensures until 27/09/2019 until 27/09/2019 until AGM 2022 until 27/09/2019 until AGM 2022 until AGM 2020
compliance with best practices.
(1) Appointed by the State
(2) Independent
Other advisory committees have also been developed to advise AGM: Annual General Meeting of shareholders
and assist the Board of Directors.
The market we operate in: Consumer 6
• Cable competitor North & 2/3 of
• National player Brussels
• Challenger for Fixed in North • Leader in North for Fixed and Mobile
• Leader for Fixed in South • Acquired BASE mobile network
except for dTV.
BELGIUM
• National leader for Mobile
11.4 million inhabitants
FLANDERS 4.9 million households
(NORTH)
• National player
• No-frills provider owned by
Proximus BRUSSELS
• Challenger for Fixed & Mobile • National Mobile player
• Challenger for Mobile
WALLONIA • No fixed offer
(SOUTH) • Owned by Telenet
• Cable Competitor in South & 1/3 of
Brussels
• Challenger for Fixed voice, Fixed
broadband & Mobile
• +30 MVNOs
• Leader in South for dTV
• National player • Challengers for Mobile
• Owned by Nethys & Brutélé
• Enodia (Pubifin) splitting companies in • Mobile network operator
2 divisions, paving the way for a • Offering Fixed services via
potential (partial) sale of VOO Cable Wholesale
The market we operate in: Enterprise 7
• Telenet high focus on Flanders, but national
coverage via multiple access technology and
• Maintains solid position in Telco market. partnerships.
• Market leader for fixed as well as mobile. • Reinforcing its position thanks to take-over
• Strong ICT offer supported by partnerships & • Proximus is market leader on the of IT integrator Nextel and cable operator
acquisitions (e.g. Telindus, Codit…). Belgian enterprise telecom market. SFR.
• One of challengers on fragmented • Mainly operating in the SME market
• Main telecom competitors: Telenet, Orange, WIN
IT market.
• N°1 M2M player • Niche players International players:
• Main IT competitors (fragmented market):
• WIN is sister of VOO ; the ICT B2B
branch of Group Nethys. Focus on
Wallonia & Brussels.
• Main challenger on the mobile enterprise • VOO is mainly focusing on smaller
market. enterprises, WIN on higher segment
• International M2M Competence Center of the and very solid position in Public sector.
Group is hosted by Orange Belgium. • Own network and Wallonia Data
• Higher competitive pressure since take-over of Center. Regional coverage, national
Base by Telenet. coverage via partners.
Our complementary brands meet the demands 8
of a wide range of customers
Best quality and service No frills offering for Specialised in ICT, The Proximus Group Best-in-class international
with a full choice of customers looking for the delivering access, telecom operator in wholesale solutions for
features – bringing best prices. connectivity and data Luxembourg, offering voice and mobile data
consumers and businesses center solutions combined fixed, mobile and service providers.
instantly close to what with managed services convergent services. Expertise in Security and
matters. and multi-vendor support. CPAAS solutions.
Belgium
Dual-brand strategy in Netherlands Global
Belgium Proximus
Luxembourg Luxembourg Luxembourg
9
Proximus Group key figures (FY’2018)
€ 5,804M €1,866M € 1,019M
Group Underlying Revenue Group Underlying EBITDA Capex
77% Domestic 92% Domestic Increasing amount allocated to
23% BICS 8% BICS fibre roll-out
€ 501M
BICS Normalized Free Cash Flow
23% Consumer BICS
50% 8% € 451M excl. acquisitions
Other
3%
€ 1.5
Enterprise Domestic Gross dividend per share
24% 92%
10
For Domestic operations, we maintained a stable revenue
in 2018, with a solid 1.9% domestic EBITDA growth
(underlying, M€)
YoY evolution per product group
=
+1.1
%
+0.7
FY’17: 4,458
% Lower Mobile
Terminals sales and Fixed Data/Internet +29
Domestic 4,458 4,458 inbound revenue
ICT
Revenue 4,410
impacting trend, +24
4,379 though having minor
margin effect TV +14
Mobile Postpaid +9
Subsidiaries (Tango) +5
2015 2016 2017 2018
Advanced Business Services +2
+1.9 -2 Mobile Terminals
+2.0 %
%
+4.7 -4 Other products
%
Domestic -5 Fixed Terminals
EBITDA & 1,647 1,680 1,713
+2.5pp Wholesale
EBITDA 1,573 EBITDA margin
-6
margin (%) 2015-2018 -24 Mobile Prepaid
2015 2016 2017 2018 -44 Fixed Voice
35.9 37.3 37.7 38.4
% % % % FY’18: 4,45811
BICS, operating in International Carrier market, faces
ongoing transition with usage moving from Voice to Data
BICS segment result
& contribution margin (%)
BICS segment result YoY
Aquisition
TeleSign
in November 26 -27
2017 12 154
143
149 143 154
FY17 Voice DM Non-Voice DM Expenses FY18
2016 2017 2018
Low Capex,
Successful TeleSign integration
✓ A2P volumes X3 vs 2016
High Cash
Conversion
✓ CoGS synergies12
€ 506M net income for FY18
ETR 26.8% vs 25.1% in YTD’17
43 -20
-53
522 14 -8 7 506
YTD
(M€)
Net income Underlying Incidentals D&A Net Finance Tax Others Net income
YTD'17 EBITDA result expense YTD'18
varianceExtensive investments in high-quality networks and 13
improved IT systems to support overall customer experience
1,092 1,019
949
Capex
(M€) Ad
FY'16 FY'17 FY'18
2017 includes Jupiler
League and Champions
League football
broadcasting rights
High-quality IT
TITAN Project Copper upgrade Fiber build
Mobile network
4G pop coverage Proactively strengthening 95% FttC, 88% vectoring
• outdoor 99.9% our transport network >50% 100 Mbps FttH & FttB Renewed & simplified
• indoor 99.5% Backbone of all voice, data & IT systems
Av. VDSL speed - Mbps
TV traffic a.o. new Mass Market IT
Proximus customers
+ Mobile sites to chain encompassing sales to
support traffic increase ordering to billing
72 76
Data capacity
+ 4.5G deployment
x10
Q4'17 Q4'182018 normalized FCF of € 501M, 14
€ 451M FCF including acquired ICT subsidiaries
43 -22
-111
225 517 -51
65 8 501
451
292
FCF FY'17 Acquisitions FCF FY'17 Underlying Income tax Cash AP/AR/Inventory Other FCF FY'18 Acquisitions FCF FY'18
2017 normalized Ebitda payments Capex normalized 2018
Normalized 2017 excludes acquisition of TeleSign (including cost of transaction-related hedging instrument), Unbrace and Davinsi Labs
Normalized 2018 excludes acquisition of Codit, Umbrio , ION-IP and Mediamobile (acquired by Be-Mobile)Sound financial position. 15
Net debt at ~1.1X EBITDA
Dividends to
Net Debt DEC non-controlling Net Debt DEC
5.6 Yrs
2017 FCF Dividends interests Other 2018
Average debt duration
Net Debt
1.78%
(M€)
451 -485
Weighted average coupon
-28
2
-2,088 -2,148
Credit ratings: Standard & Poor’s A,
Moody’s A1, both stable outlook
Debt Liquidity end Q4’18:
Maturity 400
Investment loans
• € 349M investments, cash & cash
600 equivalents (incl. derivatives)
Schedule 500 500
Ұ private placement • EMTN Program €3,500m (€1,850m
(M€) outstanding)
231 Institutional • Committed credit line
11 150
100 Eurobonds (bilaterals/club/syndicate): €700m
• CP Program €1,000M (€231m
2019 2022 2023 2024 2025 2026 2027 2028
outstanding)16
We offer an attractive shareholder return
Proximus intends to pay a stable dividend of EUR 1.50 per share over the result of 2018 and 2019 , in line with the
announced 3-year commitment on 16 December 2016.
General Shareholder return policy
We offer an attractive shareholder remuneration policy by
€ 1.5
returning, in principle, most of our annual free cash flow. Total gross dividend
This return of free cash flow is reviewed on an annual basis
in order to keep strategic financial flexibility for future
per share
growth.
The policy is based on a number of assumptions regarding
future business and market evolvement, and may be subject
~6%
to change in the event of unforeseen risks or other factors
beyond the company's control.
Dividend
yieldAn ambition, 17 inspired by our sense of purpose Creating an inclusive, safe, sustainable & prosperous digital Belgium Commitment to the UN Sustainable Development Goals
18
An ambition inspired by our sense or purpose
Our company sense of purpose: Our societal impact ambition:
We open up a world of digital opportunities so people live Creating an inclusive, safe, sustainable and prosperous
better and work smarter digital Belgium
Enabling Caring for
Digital infrastructure Customers first
a better our
digital life stakeholders
Digital innovation CO2 neutral Caring for employees
Circular economy
Sustainable supply chain
Digital trust Doing business right
Contributing Digital for all Respecting CO2 neutral
to society our planet
Belgian culture Circular economy
Societal engagement Sustainable supply19
We are committed
to making a societal impact
Improving fixed and Responsible marketing Founding partner of • CO2 neutral for
mobile connectivity in parental control on TV Coding School 19 own activities;
white zones and smartphones • CO2 reduction
-75% vs 2007
Supporting local Upskilling effort from 3 -18% vs 2015
X2
12,500 kids trained on
innovation to 6 days per employee
safer internet use
ecosystems per year in next 3 years
Building trust in digital Hires or promotions in -50% energy
consumption of
as founding partner in 50% leadership team in 1,000+ long-term sick
kids connected to school decoders in past 5 years
coalition 2018 are women
Easy to find and
understand privacy CSR clause in all Sponsor of the 18,000 smartphones
settings on App, TV and 100% contracts Paralympic athletes recycled in schools
websites20
Guidance 2019
2019 Expectations
Guidance Actuals Guidance
metrics FY 2018 FY 2019
Domestic underlying
€4,460m Nearly stable • Nearly stable Domestic
revenue revenue in competitive market
• Slight EBITDA growth for our
Domestic operations
Group underlying
€1,865m Stable
EBITDA • Unfavorable EBITDA effect on
BICS following renewal MTN
commercial agreement*
• Regulatory measures to reduce
CAPEX €1,019m Stable the Domestic margin by € 20M
• Capex to be stable to the 2018
level
Note: 2019 and comparable base of 2018 are both under IFRS15.
The underlying numbers exclude the incidental impacts and include lease depreciation and interest as from 2019,
neutralizing the IFRS16 impact.
Acquisitions of Rights of Use in application of IFRS 16 will not be part of Capex.
*Subject to MTN Board ratificationDomestic operations
Thanks to a good execution of our ‘Fit for Growth’ 22
strategy, we kept a strong position in a more competitive
domestic market
Realized Domestic EBITDA
1. We adopted a multi-brand strategy and segmented the market.
growth, in spite of
regulatory and competitive
2. We grew a valuable converged customer base in the Consumer
segment and a strong market position, while keeping a sound
pressure
pricing strategy.
3. We diversified our Enterprise portfolio from pure connectivity to Solid FCF, allowing for
digital transformation solutions. investments and attractive
4. We put high focus on bringing superior customer experience and shareholder return, while
closed the content gap. maintaining a sound financial
position
5. We launched innovative solutions to secure future growth.
6. We further enhanced our high-quality networks and launched a
future-proof fiber roll-out.
7. We transform, simplify and digitize to structurally reduce the cost
base.23
Successful market segmentation
Make
Bizz Online
& Bizz All-in it
for SE customers epic
Small
Families
Families Millennials
Millennials Price Seekers
EnterprisesIncreasingly convergent customer base 24
in premium family segment
Driving growing 4P customer base
Solid increase in number of
HH/SO taking 4 Plays (in 000’s)
2,979 2,956
+7.0%
4P 683 731 +48k
3P 746 733
2P 411 387
508
customer
Tuttimus/Bizz All-in 359
subscribers in ‘000 value 1P 1,139 1,105
+
124 lifecycle
Jan'17 Q4'17 Q4'18 Q4'17 Q4'1825
Supported by our dual-brand TV Park
Q4’18 vs Q4’17
approach, we grew our Internet and (in ‘000)
+50K
TV customer bases while keeping a customers YoY
solid market position 1,611 +3.2%
1,560 37.3%
1,489
+0.5 pp
YoY
END'16 END'17 END'18 Market Share
Q4’18 vs Q4’17 Q4’18 vs Q4’17
Broadband Park Fixed Voice Park
(in ‘000) +43 K (in ‘000)
-108K
customers YoY
customers YoY
+2.2% 2,688
2,624
-4.1%
2,026 46.4%
1,983 2,516
1,920
-0.2 pp
YoY
END'16 END'17 END'18
END'16 END'17 END'18
Market Share
25Mobile Park (excl. M2M) 26
We gained Mobile postpaid (in ‘000)
customers in a competitive +134,000 YoY
setting Postpaid 3,736 3,882 4,016
i.e. +3.5%
END'16 END'17 END'18
+3.5% Prepaid 1,181 956 822
-134,000 YoY
i.e. -14.0%
YoY end Q4’18 END'16 END'17 END'18
Smartphone Penetration National Mobile Data usage
Market Shares % (average/user/month)
Total mobile Postpaid
77 2.2
39.3% 42.4%
% GB
+0.4 pp -0.6pp +4 pp YoY +56% YoY
YoY YoY BlendedOver the past years, we diversified our 27
portfolio to stay relevant for our Enterprise
customers & protect our Telco business
New ICT Eco
System incl. 1.2X
Be-Mobile
Revenue
2015 2018
1.6X
+2.5 ppt
EBITDA EBITDA
2015 2018 margin28
We want to be the trusted partner in the digital
transformation of enterprises
Integrated
Advanced
business
Workplace
IoT
applications
Managed
Security
services
Data
AnalyticsOur Enterprise segment maintains a strong position in 29
Mobile, while containing the erosion of legacy services by
bringing customers to future proof technologies
Mobile voice cards M2M
(000’s) (000’s)
• High-quality mobile network
1,327
• Provide best E2E experience 1,028
988
• Managed mobile services 939
1,209
• Simplified offers 1,169
• Developing mobile +4.1% +9.7%
application integration
competences END'16 END'17 END'18 END'16 END'17 END'18
Fixed Voice lines
(000’s)
• Dynamically guide customers in
their Voice & UC journey
25
620
• Convergent voice solutions 580 > % of National
• Migrate customers to future proof 541 Fixed Data revenue is
Fix data solutions: VDSL and FIBER based on Fiber
connectivity
• Improve customer experience
• Achieve network simplification
END'16 END'17 END'1830
We put high focus on bringing a superior customer
experience for consumers and enterprises
Upgrading Extended
customers to latest hours contact
technology Same Day centers & 400
Repair Bizz experts
customer visits
200,000+ Always on support
YouTube
video Happy House
Visits
99.99% Service continuity for
Full Install,
Small Enterprises
tutorials
1st time Availability
right for
1.5M 24/7 business customers
Proximus 93%
Forum MyProximus 7/7
satisfaction Technical support
users31 We continued to Studio 100 is moving to Proximus enrich our content offer
32
Launching innovative solutions to secure future growth
Fiber roll-out
launched,
and continuing
predict prevent
respond detect
€ 3Bn
investment over 10 years
Security
Security
IoT
Internet of Things
Data Analytics
Data Analytics
Fiber
FiberWe further enhanced our high-quality networks, delivering 33
an excellent mobile experience while coping with boosting
traffic
Total Mobile
internet traffic
av. annual growth of volumes
(TB)
Coverage Voice Video
+70%
yearly
99.5%1 Ultra HD Best video 2014 2015 2016 2017 2018
Proximus internal calculation based on
4G indoor coverage Voice experience2 network data
Average per user
Mobile data consumption
92.4% 1 Fastest (GB/month)
2.2 GB
deep indoor call set-up1
+50%
yearly
2014 2015 2016 2017 2018
1. CommSquare study, an independent company which compares the network performance of Proximus with other Belgian competitors
(measurement campaign from 7/11 to 28/11/18)
2. OpenSignal analysis34
We continue with our FttH roll-out.
Good acceleration to keep us
9 cities on track with LT ambition
With Fiber
roll-out
launched # FttH homes passed
3 In the mass
+7
X
market we will
double our fiber
new cities
footprint in 2019
in 2019
Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q41835
Good dynamics in growing FttH coverage
+12ppt overall internet customer In brownfield
satisfaction vs copper Higher ARPU
& above competition
on FttH 30% of activated
customers FttH customers are new
internet customers
Fiber
Efficiencies leading to lower average ✓Market share
cost per home connected, on track to
reach €1,000/H
-24% 1st In greenfield
> 50% of activated
copper
outphasing FttH customers are new
tested in 2018 internet customers
2017 H12018 H22018 2019-2021
(cost incl. design, connection, active equipment,
internal WF, termination cost...)
(figures based on footprint end 2018)36
Fiberize vast majority of professional customers, while
adopting a more cost-efficient deployment approach
Focus on mono-sites GPON available for 48 % of
companies in industrial zonings
ARPU uplift
✓ Less complex for mono-site
✓ Improve market share in customers
SE-ME market
Complex COR multi-sites Good complementarity and Growing share of
low cannibalisation between national Fixed
pro-active Fiber GPON & Data revenue
✓ New approach: more on- on demand P2P based on Fiber
demand fiber deployment, connectivity
leading to reduced pre-
investment37
Transforming the company to further improve our customer experience
while bringing some cost opportunities
DIGITAL IT NETWORK
TRANSFORMATION TRANSFORMATION TRANSFORMATION38
Our ongoing company transformation has allowed us to *
reduce our costs
(underlying in M€)
€ -148M net OPEX since 2015
1,767
1,707 excl. ICT direct opex
1,652 1,653
ICT growth driving expenses up through
‘billable’ direct OPEX…
1,695 1,627 1,567 1,547
- 148M
…reinforced by acquired ICT companies
FY'15 FY'16 FY'17 FY'18
OPEX excl. ICT Direct OPEX ICT Direct Opex 2018 ICT acq. OPEX
€ -115M total net OPEX reduction since
201539
Over the past years, Proximus lowered its Domestic *
headcount
Early Leave Plan &
natural retirements
leading to ~2,750
FTEs to leave Proximus SA age pyramid
Domestic FTE (excl. employees opting for Early leave plan & subsidiaries)
Proximus over
2016-2020
13,627
13,095 (=gross outflow - not
12,644 12,658 including hiring to cover
Contractual Statutory
business needs)
On 1 Jan ‘19
and ’20,
last people
to leave in End Q4’18,
ELP
civil servants @
26% of Domestic
headcount 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 61 63 65
2015 2016 2017 2018 2019 202040
Strategy 2019-2021: #ShiftToDigital
Becoming digital first in all we do
Call center Full servicing We evolve
agents become digital journey to experience
digital coaches on MyProximus stores
Hire and
Seamless and We go for
reskill workforce
digital software defined
towards digital
experience for network and
savvy
enterprises telco cloud
employeesAccelerating the company transformation with gross cost reduction 41
Accelerating
ambition the company
of € 240M* transformation with gross cost
over 2019/2020/2021…
reduction ambition of € 240M* over 2019/2020/2021
Enablers to reduce our workload & workforce Invest in a sustainable future and cover for
(some examples) underlying cost inflation
Network IT Supply Expected opex evolution by end-2021
simplification (indicative graph)
simplification efficiencies
virtualisation
Inflation
€240M (wages &
• Copper phase-out • One single ordering, • Reduce cost / gross energy)
• Reduce buildings provisioning, billing & increase efficiencies opex
collection IT chain savings
Volume
ICT growth
(incl. M&A effect*)
Call External Automation
deflation call centers & digitisation
* With full impact
2018 acquisitions as
• My Proximus App • Shift to more efficient • Optimized omni- of 2019
• Digital assistant work-models channel sales
• e-Servicing
*Level of cost saving pending union negotiations2
42
BICS
International Carrier
Services Active
InternationallyDirect margin of BICS mainly driven by 43
growing contribution of non-Voice DM
Share of Non-Voice Share of Non -Voice
DM (2011) DM (2018)
46% 57%
TeleSign
consolidation
325
Total DM
275
225
Inflection Non-Voice
point, ✓ High Growth
non-voice
outweighing ✓ High Synergies
175 legacy voice
125
Voice
– Traditional Voice eroding
✓ TeleSign’s authentication
75 services
2011 2012 2013 2014 2015 2016 2017 2018 ✓ High Cash-flow generation
BICS DM Non-Voice DM Voice DM44
BICS benefiting from the boosting
mobile data volumes… Solid increase in
non-Voice volumes
(in M messages)
Non-Voice revenue growing
& Direct margin
(in M€)
450
408
400 A2P
9.6% 111%
317 350
292 8.6%
300
250
REV 35.7% 10,174
200
16.6%
1.3% DM
150
182 100 4,828
154 156 3,558
50
0
2016 2017 2018
2016 2017 2018
10bn International SMS
(P2P & A2P, 2018)45
…while managing the decline
in legacy Voice High cash
generator
thanks to scale
Less favourable destination mix negatively
impacted the revenue, though 2018 DM
& operating
leverage voice volumes
increased, benefitting from TeleSign’s
(in M minutes)
(in M€)
authentication services.
1,400
1,169
1,200 7.0%
1,003
939 +0.3%
-14.2% 1,000
-6.4%
800
REV
600 26,224
DM 24,385 24,463
400
2.7% 9.6% 200
120 123 135
0
2016 2017 2018 2016 2017 2018
BICS maintaining a top-10 world
position in a Voice market under
pressure46
TeleSign, acquired in November 2017,
contributes to all 3 growth dimensions for
BICS
1 Customers
Address new customer segments
Solutions (MVNO, Internet companies, Enterprises)
IoT
TeleSign complementary customer
Cloud Com base of >500 digital companies
Roaming (mainly B2C), including 20 of the
top 25 Internet brands
Mobile IP
2
Voice, Messaging
Solutions
Connectivity Extend portfolio with new generation
services
Europe Incumbents TeleSign expertise in
Africa & ME Mobile operators authentication/ security and in APIs
Asia-Pac MVNOs
3
Americas Internet companies Geographies
Latin America Enterprises Increase market shares in Asia and
Americas
TeleSign strong presence in North
Geographies Customers America47
Combination of BICS and TeleSign leads to first end-to-end CPaaS
provider
has the customers and the platforms brings the mobile and worldwide reach
Using BICS’
Worldwide network… …to reach directly >700 mobile operators
worldwide and improve sourcing of:
Direct SMS and
Voice Terminations
Mobile End-User Data
Voice APIs (e.g. Anonymous calling)
Platforms
& Expertise48 Cautionary Statement “This communication might include some forward-looking statements, without limitation, regarding Proximus’ financial or operational results, certain strategic plans or objectives, macro-economic trends, regulation, future market conditions and other risk factors. These forward-looking statements rely on a number of assumptions concerning future events and are subject to uncertainties and other factors, many of which are outside Proximus’ control. Therefore the actual future results may differ materially from those expressed in or implied by the statements. Readers are cautioned not to put undue reliance on forward-looking statements, which speak only of the date of this communication. Proximus disclaims any intention or obligation to update and revise any forward-looking statements, whether as a result of new information, future events or otherwise”.
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For further information
Nancy Goossens Sarah Franklin
+32 2 202 82 41 +32 2 202 77 11
Director Investor Relations Investor Relations Manager
E-mail: investor.relations@proximus.com
Proximus investor relations website: www.proximus.com/en/investorsYou can also read
