2004 Brazilian Telecommunications Conference
Download
1 / 9

2004 Brazilian Telecommunications Conference - PowerPoint PPT Presentation


2004 Brazilian Telecommunications Conference. September 23-24 Rio de Janeiro, Brazil . www.telemar.com.br/ir. Agenda. 1. Highlights 2Q04 . 2. Market Trends. 3. Regulatory Agenda. Highlights 2Q04. Fixed Line Stable (0.5%)

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha

Download Presentation

2004 Brazilian Telecommunications Conference

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript


2004 Brazilian Telecommunications Conference

September 23-24

Rio de Janeiro, Brazil

www.telemar.com.br/ir


Agenda

1. Highlights 2Q04

2. Market Trends

3. Regulatory Agenda


Highlights 2Q04

  • Fixed Line Stable (0.5%)

  • Strong growth in mobile subs (15.5% QoQ) as well as ADSL (21.5% QoQ)

  • Revenue increased by 3.3% QoQ, mainly due to mobile services and handset sales, what put pressure on

  • EBITDA margin (40.7%) also impacted by provision for contingencies (bad debt reduction being the good news)

  • FCF after CAPEX of R$ 1.5 billion, helped by low CAPEX level and WC needs

  • Net Debt down by R$ 1 billion at R$ 7.3 billion (1.1x EBITDA)


Market Trends - Penetration Figures / Brazil

Fixed: 38 m (Jul/04)

Mobile: 57 m (Aug/04)

22%

32%

  • Mobile penetration still has a lot of room to grow, helped also by expected economy recovery;

  • Anatel estimates between 62.8 m 69.8 m subs by 2004YE;

  • Estimated penetration for 2008YE ranges from 42% to 58%;

  • Regarding fixed line market, penetration should be more or less stable, following closely GDP growth.

58%

Max.

42%

Min.

Mobile*

Fixed Line** 23%

* Estimates from: Citigroup, Goldman, JP Morgan, Merryl Lynch, Pyramid Research.

** Estimates from Yankee Group


Market Trends – Broadband Growth / Brazil

Broadband Access – ( thousands)

  • ADSL has become the dominant broadband technology in Brazil (over 80% market share);

  • Broadband subscriber base expected to increase by over 2.5x from 2003 through 2006 (Pyramid Research);

  • Telemar has a target to increase broadband penetration from 2% to 5% of fixed lines in service in 2-3 years.

3,831

3,547

3,148

2,591

1,874

ADSL

1,490

1,199

694

326

130

Source: Anatel / Teleco / Pyramid Research estimates.


Market Trends - Traffic Migration / Telemar

  • Local traffic mostly impacted by:

    - ADSL growth (local traffic flat monthly rate)

    - Performance of the economy, also resulting on

    - Stability of fixed lines in service;

  • Decrease in F2M traffic is mainly due to:

    - Line blockage for F2M calls;

    - Migration to mobile calls (mobile post-paid rates currently lower than F2M rates in many plans).

Local Voice Traffic (F2F)

Local Fixed to Mobile (F2M)


Regulatory Agenda

1- Mobile Termination Rate

  • “Free negotiation” (scheduled to start since July, 2004);

  • Target:Recover margins in F-M calls / share uncollectibles

2- Local Traffic in Minutes

Conversion of local traffic billing: from Pulses to Minutes (2006)

3- Unbundling

  • Line Sharing: in May 2004, Anatel established the overall conditions for line sharing, setting maximum reference values, such as monthly rental prices, at R$ 15.42 / pair and

  • Full unbundling: Anatel yet to determine prices.


Regulatory Agenda

4- Tariff Index

  • Tariff increases based on:

    IST – ATelecom Sector price index (TBD)

    “K” – New Productivity factor (TBD)

  • Interconnection rates:

    a) Defined as a % of local tariff (60% -2006; 50%-2007)

    b) “Long Range Incremental Costs” (2008 on)

5- New Universal Service Targets (2006 on)

  • Line Installation:

    Maximum Period: 1 week (=2004);

    Coverage: All Localities >300 people (=2005) - Currently >600

  • Collective Access: Public Telephone / Internet Access (new service) 2006

  • Special Class of Individual Access (AICE) (TBD)

    Higher period for line installation

    Lower monthly fee (taxes?)

    Pre Paid fixed line

    Virtual Telephone (use of voice and electronic mail in collective access)

  • 6- Fixed Line Number Portability

    • To be implemented as of 2006 (TBD)


    “Safe Harbor” Statement

    This presentation contains forward-looking statements. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements and involve inherent risks and uncertainties. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events

    Investor Relations - Telemar

    Rua Humberto de Campos, 425 / 8º andar

    Leblon

    Rio de Janeiro -RJ

    Phone: ( 55 21) 3131-1314/1313/1315/1316

    Fax: (55 21) 3131-1155

    E-mail: invest@telemar.com.br

    Visit our website:

    http://www.telemar.com.br/ir


    ad
  • Login