Q1 2017
CONSOLIDATED RESULTS
Highlights:
-
2.7% increase in the Group
customer base, to reach more than 54 million
customers;
-
1.4% growth in the Group's
EBITDA at constant exchange rate, due to the major efforts of
costs optimization, allowing for an increase of 1.6 points in the
EBITDA margin, up to 49.8%;
-
2.1% increase in consolidated
EBITA and 8.7% rise in the Group share of net income, at
constant exchange rate and excluding exceptional items;
-
High demand for mobile
data, for which revenues grow by 58% in Morocco;
-
Re-establishment of a 20%
asymmetry of mobile termination rates in Morocco, to the
benefit of the competitor operators as from March 1st, 2017;
-
Continuous turnaround of the
new subsidiaries Moov that are now generating a positive net
income;
-
Success of the voluntary
redundancy plan in Morocco launched in December 2016.
2017 outlook maintained, at
constant scope and exchange rates:
On the occasion
of the publication of this press release, Abdeslam Ahizoune,
Chairman of the Management Board, stated:
"In a context
marked by a tightening of environmental and competition
regulations, Maroc Telecom Group good results for this first
quarter of 2017 prove the relevance of its development model, which
is based on an effective commercial dynamic that is centered on
technological innovation and services adapted to the needs of its
customers. In a parallel fashion, the Group pursues its costs
optimization, to sustain its margin rates and strengthen its
profitability. Its investment capacity, which is thus preserved,
enables the Group to pursue a strategy whereby it stands out for
the quality of its networks and services in its markets both in
Morocco and in the Sub-Saharan Africa."
Group consolidated
results
IFRS in MAD
millions |
Q1-2016 |
Q1-2017 |
Changes |
Change
at constant exchange rates(1) |
Revenues |
8,750 |
8,517 |
-2.7% |
-1.9% |
EBITDA |
4,214 |
4,242 |
+0.7% |
+1.4% |
Margin (%) |
48.2% |
49.8% |
+1.6 pt |
+1.6 pt |
EBITA
net of exceptional items* |
2,615 |
2,649 |
+1.3% |
+2.1% |
Margin % |
29.9% |
31.1% |
+1.2 pt |
+1.2 pt |
EBITA |
2,910 |
2,466 |
|
|
Net
earnings Group share
net of exceptional items* |
1,376 |
1,494 |
+8.6% |
+8.7% |
Margin (%) |
15.7% |
17.5% |
+1.8 pt |
+1.7 pt |
Net earnings Group share |
1,526 |
1,366 |
|
|
CAPEX (2) |
2,074 |
1,187 |
-42.8% |
|
o/w licenses &
frequencies |
882 |
|
|
|
CAPEX
/REV.(excl. frequencies & licenses) |
13.6% |
13.9% |
+0.3
pt |
|
CFFO |
2,642 |
1,350 |
-48.9% |
|
* The exceptional items
corresponding to the capital gain on the disposal of real estate
for 295 million Moroccan Dirhams at the first quarter of 2016 and
restructuring costs for 183 million Moroccan Dirhams at the first
quarter of 2017
The number of Group subscribers
reached more than 54 million at end March 2017, up 2.7% over one
year, mainly driven by the growth of the Mobile and Internet
customers in Niger, Ivory Coast, Togo and Gabon thanks to
continuous market share gains.
As of end of March, 2017, Maroc
Telecom Group reported consolidated revenues(3)
totaling 8,517 million Dirhams, down 2.7% (-1.9% at constant
exchange rates), notably due to the unfavorable calendar effect and
important reductions in call termination rates in Morocco and
internationally.
- Earnings from operations before
depreciation and amortization
At end of March 2017, Maroc
Telecom Group earnings from operations before depreciation and
amortization (EBITDA) amounted to 4,242 million Dirhams, up 0.7%
from the previous year (+1.4% at constant exchange rates). This
performance is explained by the intensification of programs seeking
to cut operating costs, which drop by 2.0% at constant exchange
rates, and the favorable impact of the reduction in mobile
termination rates in the African subsidiaries. The EBITDA margin
has risen by 1.6 pt in a year, and established to the high level of
49.8%.
At end of March 2017, consolidated
earnings from operations(4) (EBITA) for
Maroc Telecom Group stand at 2,466 million Dirhams, including 183
million Dirhams of restructuring costs relative to the voluntary
redundancy plan launched in Morocco at the end of 2016. Excluding
this one off impact and the capital gain realized following
the disposal of a real estate asset in the first quarter of 2016
(295 million Moroccan Dirhams), Maroc Telecom Group EBITA rose by
2.1% at constant exchange rates, due to the 1.4% improvement in
EBITDA.
The voluntary redundancy plan in
Morocco launched in December 2016 has benefited a total of 1,017
employees, for a global cost of 569 million Dirhams.
- Group share of net income
For the first quarter 2017, the
Group share of net income came to 1,366 million Dirhams, after
booking restructuring costs in the amount of 128 million Moroccan
Dirhams after tax. Apart from this effect and the real estate
capital gain realized in the first quarter of 2016, the group share
of net income rose by 8.7% (at constant exchange rates), notably
due to the success of the restructuring of the new subsidiaries
which net income, in total, is positive now.
Cash flows from operations
(CFFO)(5) are down
49% as compared with the same period of 2016, to 1,350 million
Dirhams, after making payment of 435 million Dirhams for licenses
in the Ivory Coast and Togo and of 553 million Dirhams for the
voluntary redundancy plan in Morocco. The remaining part of the
restructuring charge will be disbursed in the second quarter of
2017.
review of group activities
IFRS in MAD
millions |
Q1-2016 |
Q1-2017 |
Changes |
Revenues |
5,157 |
5,024 |
-2.6% |
Mobile |
3,399 |
3,275 |
-3.6% |
Services |
3,319 |
3,187 |
-4.0% |
Equipment |
80 |
88 |
+9.8% |
Fixed-line |
2,240 |
2,214 |
-1.2% |
including fixed-line
data* |
597 |
640 |
+7.1% |
Elimination |
-482 |
-465 |
|
EBITDA |
2,680 |
2,643 |
-1.4% |
Margin (%) |
52.0% |
52.6% |
+0.6
pt |
EBITA
before restructuring |
1,767 |
1,717 |
-2.8% |
Margin (%) |
34.3% |
34.2% |
-0.1
pt |
EBITA |
1,767 |
1,534 |
|
CAPEX |
499 |
599 |
+20.1% |
CAPEX
/REV. |
9.7% |
11.9% |
+2.3
pts |
CFFO before restructuring |
1,572 |
1,541 |
-2.0% |
CFFO |
1,572 |
988 |
|
*Fixed-line data includes Internet, ADSL TV
and Data services to businesses
During the first quarter of 2017,
operations in Morocco generated revenues of 5,024 million
Dirhams, down 2.6% as a result of the reduction in revenues from
the Mobile (- 3.6%) and Fixed (-1.2%) activities in
rather unfavorable regulatory and competition contexts. The
re-establishment of a 20% asymmetry on mobile call termination
rates as from the beginning of March and the incoming international
revenue decrease are partially offset by the upturn of both mobile
(+58%) and fixed data revenues (+7%).
Earnings from operations before
depreciation and amortization (EBITDA) stand at 2,643 million
Dirhams, down slightly by 1.4% vs the same period of the previous
year, thanks to the 1.8% reduction in operating costs reflecting
the first positive effects of the voluntary redundancy plan. The
EBITDA margin rose by 0.6 pt and reached a high level of 52.6%.
Earnings from operations (EBITA)
was 1,534 million Dirhams, following the booking of an additional
restructuring charge of 183 million Dirhams, connected with the
voluntary redundancy plan. Aside from this effect, EBITA in Morocco
would have dropped by just 2.8%, due to the 1.4% reduction in
EBITDA and the 1.4% rise in amortization expenses following the
major investments pursed by Maroc Telecom to modernize its networks
and deploy 4G+.
During the first three months of
2017, cash flows from operations in Morocco stood at 988 million
Dirhams, due to the payment of 553 million Dirhams in indemnities
under the scope of the voluntary redundancy plan. Restructuring
operations aside, these flows dropped by just 2.0% due to the
reduction in EBITDA and the 20% rise in investments.
Mobile
|
Unit |
Q1-2016 |
Q1-2017 |
Changes |
Mobile |
|
|
|
|
Customer base(6) |
(000) |
18,317 |
18,373 |
+0.3% |
Prepaid |
(000) |
16,633 |
16,622 |
-0.1% |
Postpaid |
(000) |
1,684 |
1,752 |
+4.0% |
o/w Internet 3G/4G+
(7) |
(000) |
6,779 |
8,063 |
+19.0% |
ARPU(8) |
(MAD/month) |
59.0 |
56.6 |
-4.1% |
As of March 31, 2017, the Mobile
subscriber base(6) reached
18.4 million, up 0.3% in a year, thanks to the 4.0% rise in
postpaid subscribers, whilst the prepaid remained stable
(-0.1%).
With the establishment of a 20%
asymmetry on termination rates in favor of competing operators
since March 1st, 2017 and a
decrease in incoming international traffic, Mobile revenues came to
3,275 million Dirhams, down 3.6% over the same period of last
year.
The outgoing revenues invoiced to
customers are up by a solid 2.1% thanks to the success of Maroc
Telecom mobile data offers which more than offset the drop in
Voice, despite the unfavorable calendar effect.
Blended ARPU(8) for
the first three months of 2017 was 56.6 Dirhams, down by 4.1%
compared to the same period in 2016.
The rise in data
services(9) continued
with an 85% increase in traffic and a 19% increase in the mobile
Internet customer base, supported by the rapid expansion of 3G and
4G+ networks covering 87% and 74% of the population
respectively.
Fixed-line
|
Unit |
Q1-2016 |
Q1-2017 |
Changes |
Fixed-line |
|
|
|
|
Fixed
lines |
(000) |
1,606 |
1,670 |
+4.0% |
Broadband access(10) |
(000) |
1,174 |
1,285 |
+9.4% |
At the end of March 2017, the
Fixed-line subscribers base reached 1,670 thousand lines, up 4.0%,
mainly driven by the Residential segment, which increased its
subscribers numbers by 6.0%.
The ADSL subscriber base continued
to rise with close to 1.3 million subscribers, up 9.4% over the
year.
During the first quarter of 2017,
Fixed-line and Internet businesses in Morocco booked revenues of
2,214 million Dirhams, down 1.2% compared with the same period of
2016, primarily due to the reduction in the international transit
business, which had small margins. Growth of Fixed-line data
remains solid, rising by 7.1% during the first quarter of 2017.
International
Financial indicators
IFRS in MAD
millions |
Q1-2016 |
Q1-2017 |
Changes |
Change
at constant exchange rates(1) |
Revenues |
3,860 |
3,766 |
-2.5% |
-0.7% |
including Mobile Services |
3,466 |
3,399 |
-1.9% |
-0.1% |
EBITDA |
1,534 |
1,599 |
+4.2% |
+6.3% |
Margin (%) |
39.7% |
42.5% |
+2.7
pts |
+2.8
pts |
EBITA
net of the real estate disposal |
848 |
932 |
+9.8% |
+12.2% |
Margin (%) |
22.0% |
24.7% |
+2.7 pts |
+2.8 pts |
EBITA |
1,143 |
932 |
|
|
CAPEX |
1,575 |
588 |
-62.7% |
|
o/w
licenses & frequencies |
882 |
|
|
|
CAPEX /REV.(excl. frequencies & licenses) |
17.9% |
15.6% |
-2.3
pts |
|
CFFO |
1,070 |
362 |
-66.2% |
|
During the first quarter of 2017,
the Group's international activities recorded revenues of 3,766
million Dirham, down 2.5% as a result of unfavorable calendar and
foreign exchange impacts, as well as major reductions in call
termination rates. Outside the impact of these factors, the
revenues of the African subsidiaries are up 1.6%, a similar
performance to that of the fourth quarter of 2016, thanks to gains
in market share and growth in Data usage.
For the same period, earnings from
operations before depreciation and amortization (EBITDA) came to
1,599 million Dirham, up 4.2% (+6.3% at constant exchange rates),
due to the improvement by 2.4 points in the gross margin rates,
particularly following the reduction in call termination rates and
the efforts made to optimize operating costs, which are down
1.6%.
Earnings from operations (EBITA)
for the first quarter of 2017 came to 932 million Dirhams, showing
a sharp rise by 12.2% at constant exchange rates, after adjusting
for the capital gain of 295 million Dirhams realized during the
first quarter 2016 following the disposal of a real estate asset.
The corresponding operating margin stood at 24.7%, up 2.8 points at
constant exchange rates, thanks to the 0.4% reduction in
amortization expense.
Cash flows from operations (CFFO)
on international business came to 362 million Dirhams following the
payment made of 435 million Dirham for licenses in the Ivory Coast
and Togo. Aside from these exceptional items, and the capital gain
realized in the first quarter of 2016, the CFFO of the African
subsidiaries is up 1.1%.
Operating
indicators
|
Unit |
Q1-2016 |
Q1-2017 |
Changes
|
Mobile |
|
|
|
|
Customer base(6) |
(000) |
|
|
|
Mauritania |
|
2,099 |
2,041 |
-2.8% |
Burkina
Faso |
|
6,912 |
7,040 |
+1.8% |
Gabon |
|
1,567 |
1,716 |
+9.5% |
Mali |
|
8,810 |
6,833 |
-22.4% |
Ivory Coast |
|
5,395 |
7,014 |
+30.0% |
Benin |
|
3,503 |
3,775 |
+7.8% |
Togo |
|
2,196 |
2,574 |
+17.2% |
Niger |
|
967 |
1,623 |
+67.8% |
Central African
Republic |
|
138 |
135 |
-2.1% |
Fixed-line |
|
|
|
|
Customer base |
(000) |
|
|
|
Mauritania |
|
46 |
48 |
+4.6% |
Burkina
Faso |
|
76 |
76 |
-0.5% |
Gabon |
|
18 |
19 |
+4.6% |
Mali |
|
140 |
151 |
+8.3% |
Broadband |
|
|
|
|
Customer base (10) |
(000) |
|
|
|
Mauritania |
|
11 |
11 |
+4.2% |
Burkina Faso |
|
15 |
13 |
-8.4% |
Gabon |
|
12 |
14 |
+17.3% |
Mali |
|
58 |
63 |
+7.2% |
Notes:
(1) Fixed exchange rate upheld for
MAD / Ouguiya / CFA franc.
(2) CAPEX corresponds to the acquisition of tangible and intangible
assets over the period.
3) Maroc Telecom consolidates the following companies in its
financial statements: Mauritel, Onatel, Gabon Telecom, Sotelma and
Casanet as well as the new African subsidiaries (Ivory Coast,
Benin, Togo, Niger, Central African Republic) and Prestige Telecom
which provides IT services to those companies since their
acquisition on January 26, 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) 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.
(7) 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.
(8) ARPU is defined as revenues (generated by inbound and outbound
calls and by data services) net of promotional offers, excluding
roaming and equipment sales, divided by the average customer base
for the period. In this instance, blended ARPU combines both
prepaid and postpaid segments.
(9) Mobile data revenues include revenues from all non-voice
services billed (SMS, MMS, mobile Internet, etc.), including the
valuation of Mobile Internet access and SMS included in all Maroc
Telecom postpaid rate plans and Jawal passes.
(10) The broadband customer base includes ADSL access and
connections leased to Morocco and also includes the CDMA customer
base for its historical subsidiaries.
Important notice:
Forward-looking statements. This press release
contains forward-looking statements concerning the financial
position, earnings from operations, strategy, and outlook of Maroc
Telecom, as well as the impact of certain operations. Although
Maroc Telecom may base its forward-looking statements on what it
considers to be reasonable assumptions, those statements do not
guarantee the future performance of the Company. The actual results
may be very different from the forward-looking statements because
of a number of risks and uncertainties, both known and unknown. The
majority of these risks are beyond our control, namely the risks
described in public documents filed by Maroc Telecom with the
Autorité Marocaine du Marché des Capitaux (www.ammc.ma) and the
Autorité des Marchés Financiers (www.amf-france.org). These
documents are also available in French on our website (www.iam.ma
). This press release contains forward-looking information that
cannot be measured until its publication date. Maroc Telecom in no
way commits to supplementing, updating, or modifying these
forward-looking statements as a result of new information, future
events or any other reason, subject to the applicable regulations
and especially to Articles III.2.31 et seq. of the circular of the
Moroccan Securities Regulator (Autorité Marocaine du Marché des
Capitaux) and to Articles 223-1 et seq. of the General Regulation
of the French Financial Market authority (Autorité des Marchés
Financiers, or AMF).
Maroc Telecom is a full-service telecommunications operator
in Morocco and leader in all its Fixed-Line, Mobile and Internet
business sectors. It has expanded internationally and it now has a
presence in ten African countries. Maroc Telecom is listed on both
the Casablanca and Paris exchanges, and its majority shareholders
are the Société de Participation dans les Télécommunications (SPT*)
(53%) and the Kingdom of Morocco (30%).
*SPT is a company incorporated under Moroccan law and
controlled by Etisalat.
Contacts |
Investor
Relations
relations.investisseurs@iam.ma |
Press
Relations
relations.presse@iam.ma |
MT: Q1 2017 Consolidated
Results
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Maroc Telecom via Globenewswire
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