Cmpany Presentatin 18/05/2011
Investment Highlights Attractive Bradband and Pay-TV Markets with Strng Grwth Ptential Leading Market Psitins with Critical Mass Experienced Management Team with Impressive Track Recrd Diverse, Extensive, High Quality Prduct Offering Imprved Financials and Attractive Synergy Ptential Rbust, Efficient Infrastructure with Natinal Cverage 1
Our Visin and Strategy 2
Our Visin Offerings Multiple Vide Streaming Key Market Statistics Ppulatin (m) 11.2 Husehlds 4.2m Fixed Line Telephny Fixed Lines ~ 5.5m IP Based Services Bradband Bradband Penetratin (ppulatin) Eurpean average 26% 19% Interactive Cntent Pay-TV Penetratin (husehlds) Eurpean average 11% 60% Cmmn Sales & Marketing Platfrm Custmer Supprt Functin 3
Underpenetrated Bradband and Pay-TV Markets Ppulatin Bradband Penetratin (Jun 10) Husehld Pay TV Penetratin (Dec 10) 50% 100% 98% 98% 45% 40% 39% 38% 80% 82% 80% 78% 73% 35% 32% 31% 31% 31% 30% 58% 57% Average = 60% 30% 26% 54% Average = 26% 60% 54% 51% 24% 25% 23% 21% 19% 19% 20% 40% 28% 15% 10% 20% 11% 5% 0% 0% Surce: Natinal Regulatry Authrity, Greece Bradband Evlutin Q4 10, Mar 11 Surce: Analysys Masn, Pay TV in Eurpe: market sizings and frecasts 2010 2015, May 10 N cable r FTTx in Greece Lw end Pay TV segment in Greece is emerging Greek Bradband and Pay TV markets are underpenetrated relative t Eurpean peers 4
Strategy Capture grwth frm unique bundling ffering Cmbine expertise f Nva and Frthnet t create cmpetitive triple-play service including vice, data and televisin Significant pprtunity fr grwth f triple-play prducts in the Greek market NetMed s Nva brand and attractive cntent prtfli will be key differentiating factrs f Frthnet ffer Custmer fcus and crss-selling maximisatin Significant crss-selling pprtunities fr bth vice and bradband services t Nva s custmer base and f pay-tv services t existing custmer base Acquisitin will enhance Frthnet s ability t ffer innvatin in entertainment services Will bst pre- and after-sale custmer service Leverage netwrk infrastructure ptential Best f breed and cmplementary IP based and Satellite infrastructure Will prvide ptimal cverage t the challenging Greek landscape Will make ULL infrastructure mre prfitable Realise cst savings and ther benefits frm Acquisitin Fcus n integratin f Nva t realise cst savings frm central functins and sales & marketing Benefits t cme frm ecnmies f scale as well as frm integrating and ptimising platfrms, systems and prcesses 5
Nva Infrastructure HtBird Satellite Cverage DTH 100% natinal cverage NetMed currently leases 5 HtBird transpnders frm Eutelsat Analgue Terrestrial Netwrk Analgue terrestrial ftprint ppulatin cverage: 77% 60 analgue rebradcast sites and 2 UHF frequencies Outside Athens, Ymitts and Parnitha NetMed facilities are cllcated with state bradcaster Netwrk wned, perated and cntrlled by NetMed DTT pprtunity Uplink Facility Cntent Prductin Tw prductin studis Editing and graphics equipment Signal cntributin and recrding facilities Channel play-ut, mnitring and transmissin suites Latest generatin tapeless technlgy Mbile TV and VOD capability Transmissin Facilities Five digital Multiplexers with uplinks t HtBird Satellites, mre than 40 DTH TV channels DTH distributin t Greece and Cyprus Optimized picture quality with latest MPEG, statistical multiplex technlgy IP and MPEG-4 infrastructure fr IPTV pilt Irdet cnditinal access 24/7 mnitring and netwrk management 6
Pay-TV Offering - Premium Sprts Greek Ftball Rights Superleague cntract has been extended t 2013/14 UEFA Champins League/UEFA & Eurpa League Bth majr Eurpean sccer events until 2012 UK Premier League Wrld s leading ftball cmpetitin until 2012/13 Internatinal Ftball Majr leagues and cups French League, Spanish & Italian Cups, Argentinian League Eurpean Basketball (EurLeague) Eurleague Cntract until 2013/14.Final 4 2011 in HD Other Tp Events Cpa America 2011, ATP Tur Masters 1000 renewal until 2013 7
Pay-TV Offering Premium Mvies and Thematic Cntent Established Studi Relatinships Cmprehensive Cverage f all Majr Studis Typical Cntract Terms Key TV Rights Three t five years Exclusive Pay-TV rights, cvering IPTV & SVOD right Distributin rights fr multiple platfrms fr Independent suppliers Balanced mix f current & nn-current studi prduct Rights fr multiple runs Spread f terminatin dates up t 2014 Illustrative Greek Film Release Windw Cinema VOD/DVD Pay-TV FTA 2-3 mnths 6-9 Mnths 9 mnths Targeted Apprach fr Ppular TV Series Brad Prtfli f Thematic Channels Selective apprach 1st n TV in Greece Strng perfrmers The Mentalist, NCIS, Burn Ntice, Bardwalk Empire Majrity f renewal n the basis f renegtiatin All series subtitled 8
Launch f High Definitin Preserve leading psitin, and innvative character Secure and/r prduce premium cntent in HD Blck exclusivities with key HD thematic channels Sft Launch in August 25 th with the Dream Game (USA vs Greece) Nva HD Nva STB Universal studis renewal Pay tv catch up & HD rights 45 Hllywd titles August 26th September 1st December 22nd March 17nd, 2011 Nva intrduced High definitin channels fr the first time in Greece, including the mst premium prduct in high quality Leader in the technlgical develpments & Enhancing viewership experience 9
Natinal Backbne Backhaul Infrastructure Cmpleted C.5,189km f fibre ptic MAN, and WAN and 495 ndes f physical and remte cllcatins t OTE s lcal exchanges fr ffering ULL services, cvering Athens, Thessalniki and a number f ther Greek cities 53G internatinal cnnectivity. Direct ip peering at Frankfurt s exchange (DE- CIX) Prprietary netwrk allws high-speed bradband and telephny as well as further services in the future, including IPTV Impact Reduce perating reliance n the OTE netwrk and related expenses Reduce Opex and imprve financial perfrmance Imprve cntrl, service quality and reliability Rll ut increasingly advanced prducts faster and mre efficiently 10
Unbundling f Lcal Exchanges Frthnet s Cverage with Unbundling 1 Offering LLU services thrugh 495 Lcal Exchanges It crrespnds t ULL cverage f 73% f ttal lines Single ULL sites Multiple ULL sites (1) Surce: Frthnet data 11
Telecm and Pay-TV Offerings The cmbined ffering is adding mre pprtunities fr husehlds t jin ur custmer base r expand the number f services they take frm Frthnet 12
Other Offerings Other Retail Offerings Crprate Prduct Offerings Largest WiFi netwrk in Greece with mre than 351 htspts Nva services t Bars, Cafes and Restaurants MPLS VPN Internet Leased Line Frthnet Leased Lines Direct Link (LMDS) Bulk Data Centre Services IN Services Dmain names registratin Crprate Data Centre Services E-mail Hsting Public Sectr Cntracts Web Hsting SaaS Hsting 13
Frthnet Stres and Call Centres Frthnet Stres Frthnet Call Centre Frthnet is als develping its wn Cmmercial Netwrk f shps Cmbinatin f wned, franchised and shp-ina-shp 131 stres t date 2 Call Centres 212 full-time emplyees equivalent fr Nva 295 full-time emplyees equivalent fr Frthnet Cvering Athens, Thessalniki and all majr cities Frthnet already has presence in all majr retail chains Already NOVA services are available in all Frthnet shps 14
Grwing Custmer Base, Strng Crss-Selling Ptential Frthnet Bradband & ULL Subscribers Cmments ( 000s) 600 500 400 300 200 100 0 483 364 38 274 49 200 66 445 101 124 316 31 208 101 31 76 2005 2006 2007 2008 2009 2010 ULL Whlesale Ttal Access t Nva s high grwth custmer base Opprtunity t prvide the best f Frthnet s (ULL 2Play) and Nva s premium (digital Pay-TV) fferings Nva Pay-TV Custmers ( 000s) 450 400 350 300 250 200 150 100 50 0 392 349 358 363 362 330 16 12 17 13 16 12 15 53 41 32 68 77 364 237 265 292 305 319 2005 2006 2007 2008 2009 2010 Greece Digital Greece Analgue Cyprus Ttal Significant Grwth Triple-Play Offering 15
Thusands Cnsistent Grwth 800 700 Frthnet Grup Retail Subs evlutin, 2007-2010 641 725 600 500 400 421 554 346 325 280 100 300 200 100 0 25 345 290 345 208 76 2007 2008 2009 2010 Bradband/ULL standalne subs Bundled Services subs Pay TV standalne subs (equated) Maintain ULL & Pay TV leadership and identify grwth pprtunities increasing bundling services 16
Financial Review 17
Cnsistent Revenue Grwth Revenues, ( m) 450 400 350 300 250 Strng Year n Year Organic Grwth 351 204 377 200 410 196 200 150 100 50 0 119 92 98 81 214 64 177 148 119 24 32 81 92 98 64 24 32 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Telecm Pay TV Ttal Grup 18
Selected Frthnet Financials: Grup Results m 2010 Results (in 000) 2010 2009 Grup Grup Revenue(inc. ther incme) 409,852 376,985 Reprted EBIDTA 46,284 64,025 Adjusted EBIDTA(nn cash) 65,662 64,938 Adjusted EBIDTA margin 16.0% 17.2% 19
Selected Frthnet Financials: Pay-TV Results m 2010 Results (in 000) 2010 2009 Revenue 195,522 200,339 Adjusted EBITDA* 36,383 45,720 EBITDA Margin 18.6% 22.82% * Nn- Cash Adjustments 20
Selected Frthnet Financials: Telecm Results m 2010 Results (in 000) 2010 2009 Revenues 214,330 176,646 Adjusted EBITDA* 29,279 19,218 EBITDA Margin 13.7% 10.9% Capital Expenditure 52,631 69,049 * Nn- Cash Adjustments m Strng Telecm Grwth cntinues in 2010 Revenue Analysis (in 000) 2010 2009 Δ (%) Residential LLU services 150,553 111,347 35.2% Residential Whlesale Services 8,209 19,011-56.8% Business Services and Applicatins 55,568 46,287 20.05% Ttal Revenue (incl. ther incme) 214,330 176,646 21.3% 21
Selected Frthnet Financials: Telecm imprvement Revenue Grwth based m n ULL Telecm EBITDA Imprvement (in 000,000 eur) Direct Retail Services Indirect Retail Services 2007 2008 2009 2010 11.5 65.2 111.3 150.6 67.4 35.5 19.0 8.2 50.000 40.000 30.000 20.000 10.000 10,88% 13,70% 20% 15% 10% 5% 0% Business Services & Applicatins 40.6 46.9 46.3 55.6 Ttal Revenues 119.4 147.6 176.7 214.3 0-10.000-20.000-30.000 2007-16,82% 2008-0,87% 2009 2010 EBITDA EBITDA margin -5% -10% -15% -20% 22
Acquisitin Facility Attractive Financing Secured Frthnet Financing m Facilities Debt and Liquidity m Cash 36.4 as f December 2010 As f December 2010 Cash and cash equivalent: 36.4m Telc Facility Drawn 120 Senir unsecured amrtising facility maturing n 30 March 2015 Net Debt: 296.6 m Tranche A Drawn Tranche B Drawn 150 50 Senir secured amrtising facility maturing 7.5 years frm drawdwn Euribr + 2.00% Senir secured bullet facility maturing 8 years frm drawdwn Euribr + 2.25% Refinancing The Grup has initiated discussins with its lending syndicates with a view t refinance its maturing stck f debt fr 2011 and 2012 and extend the repayment prfiles beynd 2013. The prcess was frmally launched in early February and is already at an advanced stage. Tranche C Drawn 45 Senir secured bullet facility maturing 9 years frm drawdwn Euribr + 3.00% 23
Wrapping Up 24
Value Drivers Summary Bradband grwth pprtunity Lw bradband penetratin relative t Eurpe Frthnet in strng psitin t benefit frm market grwth Pay-TV grwth pprtunity Frthnet will wn the leading pay-tv prvider in under-penetrated market, fllwing the Acquisitin New tiering plicy t ignite grwth Nva brand and cntent prtfli prvide cmpetitive advantage Triple play ffering Strng prspects fr grwth in Greece Nva cntent prvides attractive differentiating factr fr Frthnet ffering ULL uptake will facilitate grwth and enhance prfitability Migratin f subscribers t ULL key t Frthnet strategy Frthnet already has strng market psitin in ULL with 32,1% market share ULL migratin and uptake will drive prfitability Synergies expected t generate value thrugh expanding surces f revenues and streamlining csts Churn reductin frm bundling 25
Thank Yu fr Yur Attentin 26