Telecomunicazioni
Maroc Telecom : 2016 Consolidated Results
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The Group's customer base comprised more than 54 million customers at end-2016, up steadily 6.3% year-on-year thanks mainly to the African subsidiaries which grew their customer base by 10%.
As of December-end 2016, the Maroc Telecom Group reported consolidated revenues of MAD 35,252 million, up 3.3% on the previous year (+2.4% on a like-for-like basis). This performance reflects revenue growth from Moroccan activities (+1.0%) along with a steady international growth (+7.1% on a like-for-like basis).
At 2016-end, Maroc Telecom Group earnings from operations before depreciation and amortization (EBITDA) amounted to MAD 16,909 million, up 1.0% from the previous year (+0.9% on a like-for-like basis). This like-for-like improvement comes from a 5.0% rise in international EBITDA which more than offsets the 1.3% decline in EBITDA of Moroccan activities. Despite a slight 0.7 point like-for-like decline, Group EBITDA margin remained high at 48.0%.
At 2016-end, Group consolidated earnings from operations (EBITA) were MAD 10,468 million, up 1.2% compared to 2015 (+1.7% on a like-for-like basis), after incorporation of a MAD-255-million restructuring provision for a voluntary redundancy plan in Morocco. Excluding restructuring, Group EBITA would be MAD 10,723 million, up 3.7% (+3.5% on a like-for-like basis), with a margin of 30.4%, up 0.3 points on a like-for-like basis.
Group share of net income was MAD 5,598 million, unchanged from 2015. Excluding restructuring expenses for the voluntary redundancy plan, net income would be up 3.2% to MAD 5,774 million reflecting the increasing contribution of subsidiaries, especially those recently acquired which benefit from business stimulation and cost optimization plans.
Cash flow from operating activities (CFFO ) was MAD 10,970 million, up 17.2% compared to end-2015 due to the cash impact of MAD 2.7 billion from 2015 license renewals (MAD 33 million in 2016) despite continuing heavy Group capital expenditure in networks amounting to 20.1% of 2016 revenue.
Although launched in December 2016, the voluntary redundancy plan will not impact Group cash flow until 2017.
As of December 31, 2016, consolidated Maroc Telecom Group debt was down 2.1% to reach MAD 12.3 billion. This represents only 0.7 times the Group's annual EBITDA.
The Supervisory Board of Maroc Telecom will propose to the general shareholders' meeting on April 25, 2017 to effect the payment of an ordinary dividend of MAD6.36 per share, representing a total amount of MAD 5.6 billion. This dividend corresponds to 100% of distributable Group share of earnings from 2016. The dividend payment date would be from June 2, 2017.
Based on the recent changes in the market, to the extent that no new major exceptional event impacts the Group's business, Maroc Telecom is projecting the following for 2017:
*Fixed-line data includes Internet, ADSL TV and Data services to businesses
During fiscal year 2016, operations in Morocco generated revenues of MAD 21,244 million, up 1.0%. Fixed-Line and Internet activities continued growing (+1.1% compared to 2015) and, along with the larger contribution from subsidiaries, offset the slight decline in Mobile revenues (-1.1%) due to a more stringent regulatory environment.
Earnings from operations before interest, amortization and depreciation (EBITDA) were MAD 11,004 million, down 1.3% from 2015 due to lower gross margin and a slight increase in operating costs (+2.4%). Although down 1.2 points, EBITDA margin was still high at 51.8%.
Earnings from operations were MAD 6,902 million, down 6.5% reflecting the decline in EBITDA, the 2.3% increase in depreciation charges and the restructuring provisions for the voluntary redundancy plan amounting to MAD 255 million. Excluding restructuring, EBITA was down by 3.1% to MAD 7,157 million, representing a margin of 33.7%.
Cash flow from operations in Morocco was up 8.3% at MAD 7,124 million, after paying MAD 926 million in 2015 for 4G licenses and frequencies and despite the faster pace of capital investment in Very High Speed Fixed and Mobile technology that reached 18.4% of 2016 revenue.
As of December 31, 2016, the Mobile customer base comprised 18.4 million clients, up 0.4% year-on-year, driven by the 4.9% increase in postpaid customers and Mobile internet subscribers who were up 21% over the year. As for the prepaid customer base was steady over the year.
The drop in Mobile revenues continued to lessen (-1.1% in 2016 vs. -6.2% in 2015) thanks to increased Data traffic. The 12.7% decline in prices weighed on Mobile revenues which amounted to MAD 13,806 million, down 1.8% from 2015.
Blended 2016 ARPU was nearly MAD 61, slightly down by 2.2% compared to the same period in 2015.
With a 96% increase in traffic, Mobile Data continued to take off, supported by the rapid expansion of 3G and 4G+ networks covering 87% and 73% of the population respectively.
The Fixed-line customer base was 1.6 million lines at December-end 2016, up 3.6%, driven by the Residential segment which increased its customer numbers by 6.0%. Driven by Double-Play plans, the ADSL base grew by 9.2% to 1.2 million subscribers.
Fixed-Line and Internet continued their solid growth with MAD 8,829 million in revenues, up 1.1% compared to the same period the previous year, sustained by the growth of Data whose revenues grew by 7.2%.
Since January 26, 2015, the acquisition completion date, international activities include the new subsidiaries in Ivory Coast, Benin, Togo, Niger and Central African Republic, as well as Prestige Telecom which provides IT services to those entities.
At December-end 2016, Group international activities reported MAD 15,326 million revenue, up 9.4% (+7.1% on a like-for-like basis) reflecting increasing revenues by new subsidiaries (+14.6% on a like-for-like basis), especially Ivory Coast and Niger, as well as historic subsidiaries (+3.6% at constant change ).
Earnings from operations before interest and depreciation (EBITDA) at end-2016 amounted to MAD 5,905 million, up 5.5% (+5.0% on a like-for-like basis) despite new taxes and royalties and non-recurring charges. Excluding scope effects (full-year consolidation of new subsidiaries), and non-recurring items, EBITDA margin on international operations would remain stable, with cost optimization programs offsetting new taxes and royalties.
Earnings from operations amounted to MAD 3,565 million, up 20.7% (+22.0% on a like-for-like basis) reflecting the increase in EBITDA, and the capital gain realized from the sale of a real estate asset (MAD 297 million). The EBITA margin was 23.3%, up 2.2 points (+2.9 points on a like-for-like basis).
Cash flow from international operations was up 38.1% compared to 2015, driven by EBITDA growth, the sale of real estate, and the positive comparative effect from licenses payment in 2015 (in Mauritania, Niger, Gabon, and Côte d'Ivoire) amounting to MAD 1,787 million. Capital expenditure in networks increased to 20.8% of revenues (compared to 16.8% in 2015) to support business growth particularly in Fixed-Line and Mobile Data, and the gain in market share.
Notes
(1) The like-for-like basis shows the impact of the consolidation of the new African operators as if they had occurred on the 1st of January 2015, and as if the MAD/Ouguiya/ CFA franc exchange rate had remained unchanged.
(2) CAPEX corresponds to property, plant, equipment and intangible asset acquisitions recognized over the period.
(3) Maroc Telecom includes Mauritel, Onatel, Gabon Telecom, Sotelma and Casanet in its scope of consolidation, as well as the new African subsidiaries in Ivory Coast, Benin, Togo, Niger, the Central African Republic, along with Prestige Telecom, which has provided IT services to these companies since their acquisition on 26 January 2015.
(4) EBITA corresponds to EBIT before the amortization of intangible assets acquired through business combinations, before impairment of goodwill and other intangibles acquired through business combinations, and before other income and charges related to financial investments and to transactions with shareholders (except when recognized directly in equity).
(5) CFFO comprises pretax net cash flows from operations (see the statement of cash flows), dividends received from affiliates, and unconsolidated equity interests. CFFO also comprises net capital expenditure, which corresponds to net uses of cash for acquisitions and disposals of property, plant, equipment, and intangible assets.
(6) Borrowings and other current and non-current liabilities less cash and cash equivalents, including cash held in escrow for bank loans.
(7) The active customer base is made up of prepaid customers who have made or received a voice call (other than from public telecommunications network operators (ERPT) or from their customer services centers) or have made an SMS/MMS or used Data services, with the exception of technical exchanges of information with ERPT departments, during the past three months, and postpaid customers who have not terminated their agreements. (8) The active customer base for 3G and 4G+ mobile Internet includes holders of a postpaid subscription agreement (with or without a voice offer) and holders of a prepaid Internet subscription agreement who have made at least one top-up during the past three months or whose top-up is still valid and who have used the service during this period.
(9) ARPU is defined as revenues generated by inbound and outbound calls and by data services net of promotional offers, excluding roaming charges and equipment sales, divided by the average customer base for the period. In this instance, blended ARPU combines both prepaid and postpaid segments.
(10) The broadband customer base includes ADSL access and connections leased to Morocco and also includes the CDMA customer base for its historical subsidiaries.
(11) Maintenance of a constant MAD/Ouguiya/CFA Franc exchange rate.
(12) The merger of Gabon Telecom and MOOV Gabon led to the consolidation of their data, especially in terms of customer bases.
Consolidated Financial statements
Comprehensive Income Statement
Consolidated Cash Flow Statement
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