Maroc Telecom : PR_FY 2015_Results- En

07be6ff2-4711-4601-baa7-ab9c648107a4.pdf

PRESS RELEASE

Rabat, February 15, 2016

2015 CONSOLIDATED RESULTS

Results exceeding announced objectives:

» Group consolidated revenues increased by 17% to more than MAD 34 billion due to the consolidation of the new African subsidiaries and the revenues' stabilization in Morocco ;

» Sharp increase in the Group's customer base to nearly 51 million customers ; » Revenues and EBITDA, up 1.6% and 0.7% on a like-for-like basis, exceeded announced objectives ;

» Excluding frequencies and licenses, the Group's Operating Cash Flow up 4.6%, despite an increase of 29% of capital expenditures ;

» Steady profitable growth in subsidiaries' activities thanks to the successful relaunch of new subsidiaries whose revenues and EBITDA rose by 12.5% and 13.5% in the fourth quarter ;

» The surge in the Very High Speed Mobile and Fixed-line broadband in Morocco continues, supported by the successful launch of the 4G+;

» Renewal of licenses in Mauritania, Niger and Ivory Coast.

Proposed distribution of a total amount of MAD 5.6 billion which corresponds to 100% of the Net Profit from 2015, implying a dividend of MAD 6.36 per share, representing a yield of 5.5%.*

Outlook for 2016, at constant scope and exchange rates

► stable revenues;

► slight decrease in EBITDA;

► CAPEX amounting to around 20% of revenues, excluding frequencies and licenses.

On the occasion of the publication of this press release, Mr. Abdeslam Ahizoune, Chairman of the Management Board, said:

"Maroc Telecom Group is finishing fiscal 2015 with results that exceed its objectives and which confirm the Group's growth profile. The major capital investments in Very High Speed Mobile and Fixed-line broadband consolidate our leadership in Morocco. The successful integration of the new African subsidiaries

strengthens the success of the Group's International expansion.

Maroc Telecom Group is tackling fiscal 2016 with confidence, despite the still uncertain regulatory, economic and competitive environments backed by the quality of its teams and its continuing policy based on innovation and investment."

* Based on the share price on February 12, 2016 (MAD 116.25).

GROUP CONSOLIDATED RESULTS

IFRS in MAD million	2014	2015	Change	Change like-for-like (1)
Revenues	29,144	34,134	+17.1%	+1.6%
EBITDA	15,691	16,742	+6.7%	+0.7%
Margin (%)	53.8%	49.0%	-4.8 pts	-0.4 pt
EBITA	10,266	10,340	+0.7%	+0.6%
Margin (%)	35.2%	30.3%	-4.9 pts	-0.3 pt
Net result Group share	5,850	5,595	-4.3%
Margin (%)	20.1%	16.4%	-3.7 pts
CAPEX (2)	4,901	8,835	+80.3%
o/w licenses & frequencies	94	2,622
CAPEX/Revenues, excluding licenses & frequencies	16.5%	18.2%	+1.7 pt
CFFO	11,541	9,362	-18.9%
Net debt	5,366	12,555
Net debt / EBITDA	0.3x	0.7x

► Customer base

The Group's customer base was nearly 51 million customers at the end of 2015, up 26% year-on-year following the consolidation on January 26, 2015 of six new subsidiaries into the Group's scope.

► Revenues

As of December-end, in 2015 Maroc Telecom Group had generated consolidated(3) revenues of MAD 34,134 million, up 17.1% on the year 2014 due to its extended scope. On a like-for-like basis(1), the increase was 1.6% reflecting strong growth in international business (+6.9% like-for-like) and business resilience in Morocco (-0.5%).

► Earnings from operations before depreciation and amortization

At 2015-end, Maroc Telecom Group earnings from operations before depreciation and amortization (EBITDA) amounted to MAD 16,742 million, up 6.7% from the previous year (+0.7% like-for-like). The increase in like-for-like growth was mainly due to the significant increase in EBITDA internationally (+10.8%), offsetting the 3.8% decline in EBITDA in Morocco.

Despite the dilutive effect of the consolidation of the new subsidiaries, the Group's EBITDA margin remained high at 49.0% (nearly stable on a like-for-like basis). Continuing efforts to control direct costs and minimize operating costs explain this good performance.

► Earnings from operations

At 2015-end, Maroc Telecom Group earnings from operations (EBITA)(4) amounted to MAD 10,340 million, up 0,7% from the previous year (+0.6% like-for-like). This like-for-like increase reflects mainly the improvement in EBITDA.

► Net income - Share of the Group

The Group's share of net income amounted to MAD 5,595 million, 4.3% down over the year mainly due to the losses generated by the new subsidiaries.

During the fourth quarter, the Group's share of net earnings rose by 2.6% mainly due to the significant decrease in the new subsidiaries' losses resulting from revenues' growth and benefits from costs' optimization plans.

► Cash flow from operations

Despite the 6.7% increase in Group EBITDA and improved working capital requirements, cash flow from operations (CFFO(5)) was MAD 9,362 million, down 19% from 2014. This change reflects the 80% growth in capital investment including the price of the 4G license in Morocco and the renewal/acquisition of the 2G/3G licenses in Mauritania and Niger as well as the 50% down-payment for the granting of a global license in Ivory Coast. Excluding frequencies and licenses, Group CFFO was up 4.6%.

As at December 31, 2015, Maroc Telecom Group's consolidated net debt(6) had increased to MAD 12.6 billion, mainly due to the acquisition of the six new subsidiaries completed during the period and the USD 200 million loan granted to Maroc Telecom by the Etisalat Group for a four years period to finance investments in the newly acquired subsidiaries. The Consolidated net debt of the Group represents only 0.7 times the Group's annual EBITDA.

► Dividend

The Supervisory Board of Maroc Telecom will propose to the general shareholder's meeting of April 26, 2016, the payment of an ordinary dividend of MAD 6.36 per share, representing a total amount of MAD 5.6 billion. This dividend, which corresponds to 100% of the Net Profit from 2015, will be made available for payment from June 2, 2016.

► Maroc Telecom Group outlook for 2016

On the basis of the recent changes in the market, to the extent that no new major exceptional event impacts the Group's business, Maroc Telecom is projecting for 2016:

• Stable revenues at constant scope and exchange rates;

• Slight decrease in EBITDA at constant scope and exchange rates;

• CAPEX amounting to around 20% of revenues, excluding frequencies and licenses.

  
  

  
  

  REVIEW OF GROUP ACTIVITIES

  
  

  • Morocco

IFRS in MAD million	2014	2015	Change
Revenues	21,133	21,033	-0.5%
Mobile	15,214	14,276	-6.2%
Services	14,781	14,058	-4.9%
Equipment	433	219	-49.4%
Fixed-line	8,041	8,728	+8.6%
o/w fixed-line data*	2,058	2,263	+10.0%
Eliminations & other revenues	-2,122	-1,971
EBITDA	11,578	11,144	-3.8%
Margin (%)	54.8%	53.0%	-1.8 pt
EBITA	7,734	7,386	-4.5%
Margin (%)	36.6%	35.1%	-1.5 pt
CAPEX	3,359	4,792	+42.7%
o/w licenses & frequencies	926
CAPEX/Revenues (excluding licenses and frequencies)	15.9%	18.4%	+2.5 pts
CFFO	8,781	6,576	-25.1%
Net debt	4,742	11,741
Net debt / EBITDA	0.4x	1.0x

*Fixed-line data includes Internet, ADSL TV and data services to businesses

During fiscal 2015, activities in Morocco generated revenues of MAD 21,033 million, slightly down by 0.5%, thanks to Fixed-line and Internet business which continued to surge (+8.6% year-on-year) offsetting the decline in the Mobile segment (-6.2% year-on- year) in a still-fiercely competitive environment.

Earnings before depreciation and amortization (EBITDA) were MAD 11,144 million, down 3.8% from 2014. This change reflects the increase in the cost of interconnection to other operators and in operating costs which rose 2.5%. The EBITDA margin remained high at 53.0%, down by 1.8 point.

Earnings from operations were MAD 7,386 million, down 4.5% due to the decline in EBITDA. The EBITA margin was 35.1%, down by 1.5 point.

Cash flow from operations in Morocco was down 25% at MAD 6,576 million following the payment of MAD 926 million for the 4G license and the development of the associated spectrum. Excluding these items, CFFO in Morocco was down 14.6% due to the decline in EBITDA and the 15% increase in capital investment in networks, mainly 4G.