Mannesmann Presents Strong Growth and Profit Outlook
29 November 1999
Mannesmann Presents Strong Growth and Profit Outlook
DUESSELDORF, Germany, Nov. 29 -- Mannesmann will present its
investment case to investors and analysts in the coming weeks. During these
meetings Mannesmann will reveal the strong outlook for its key
telecommunication businesses and will present its case for the value of
Mannesmann shares.
9 Months Results
Mannesmann published its nine months figures for its wireless and fixed
line businesses on 23 November 1999. These showed growth in proportionate
earnings before interest, taxes, depreciation and amortisation (EBITDA) for
the wireless business of 75%. When adjusted for acquisitions, the growth rate
amounted to 50% reflecting the momentum of internal growth at D2 and Omnitel.
On the fixed line side EBITDA was affected by the start-up status of Arcor
and Infostrada but both companies enjoyed outstanding revenue growth: Arcor
revenues increased by 45% to Euro 925 million and Infostrada by 664% to Euro
504 million. Both Arcor and Infostrada are clearly positioned as the leading
alternative carriers to the incumbents in Germany and Italy, respectively.
Outlook for 2000 and Beyond
WIRELESS
With its leading market positions in Europe's largest telecommunication
markets, Mannesmann expects the wireless business to continue its strong
growth in 2000 and beyond.
Wireless Group (1) 2000 Est. 2000 - 2003 Est
Proportionate
Revenues Euro 11.5 bn CAGR > 16%
Proportionate
EBITDA Euro 3.8 bn CAGR >25%
Prop. EBITDA
Margin (2) 33% 41-43% in 2003
(1) Excludes start-ups (Telering, Connect Austria, Orange Switzerland,
KPN Orange)
(2) calculated on all revenues (incl. handsets)
FIXED LINE
On the fixed line side proportionate revenues are expected to be approx.
Euro 3 bn in 2000 with expected CAGR of around 30% between 2000 and 2003. The
fixed line business is expected to EBITDA-break even in 2000 and to contribute
significantly to proportionate EBITDA growth for Mannesmann's overall
telecommunications business.
Arcor outlook 100% 2000 Est. CAGR 00-03 Est. 2009 Est.
Revenues(1)
* Voice Euro 1.3 bn 30 - 35% Euro 5.0 - 5.5 bn
* Data/Internet Euro 0.4 bn 50 - 55% Euro 4.5 - 5.0 bn
EBITDA margin 3 - 4% 23 - 25%(2) 35 - 40%
Capital
Expenditure Euro 0.5 bn -8 to -10% Euro 0.3 bn
(1) Excludes Euro 0.4-0.5bn of DeutscheBahn revenues
(2) EBITDA-Margin in 2003
Infostrada outlook 2000 Est. CAGR 00-03 Est. 2009 Est.
Revenues
* Voice Euro 1.0 bn 13 - 15% Euro 2.5 - 3.0 bn
* Data/Internet Euro 0.1 bn 60 - 65% Euro 2.5 - 3.0 bn
EBITDA margin 0-1% 23 - 25 %* approx. 35%
Capital
Expenditure Euro 0.35 bn -15 to -20% Euro 0.2 bn
* EBITDA-Margin in 2003
TELE-COMMERCE
Tele-commerce will be a significant value driver for Mannesmann going
forward based on the inevitable convergence of telecommunication and
e-commerce. Mannesmann is well positioned to capture this value based on its
over 2.5 million internet clients and its capabilities as an ISP, web hosting
company, portal, intranet service provider and tele-commerce solution
provider. Mannesmann expects revenues from tele-commerce to exceed
Euro 500 million in 2001.
OVERALL
The CAGR of proportionate EBITDA for Mannesmann's overall
telecommunications business, including wireless and fixed line, is expected to
be over 30% between 2000 and 2003.
DISCLAIMER ON FINANCIAL PROJECTIONS
By their nature, the financial projections contained in this press release
involve risk and uncertainty because they relate to events and depend on
circumstances that will occur in the future, many of which are not within
Mannesmann's control. Accordingly, there can be no assurance that actual
events and results will not differ materially from those expressed or implied
by these projections.