Corporate Profile 2021 - Telefónica
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Corporate Profile
2021
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.
Telefónica’s Our mission: we want to make our world more human
mission & values by connecting people’s lives
Values
WE ARE WE ARE WE ARE
OPEN BOLD TRUSTED
About Telefónica
Telefónica is one of the largest telecommunications service providers in the world. The company offers fixed
and mobile connectivity as well as a wide range of digital services for residential and business customers.
With 369 million customers, the company operates in Europe and Latin America.
Telefónica is a 100% listed company and its shares are traded on the Spanish Stock Market and on those in
New York and Lima.
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.
Telefónica, almost 100 years of history
2021
Sale of Telxius’ towers business
to American Towers
1924 1999 2006 2015
Telefónica and Liberty Global
Telefónica (CTNE) is Telefónica becomes Acquisition of Controlling Disposal of Telecom Italia stake join forces and create the leading
founded in Madrid, Spain a fully public company O2 (UK, stake
fixed-mobile provider in the UK
Germany and in Colombia Acquisition of DTS (Canal +)
Ireland) Telecom in Spain and GVT in Brazil
1989- 2000 Creation of fibre vehicles in Brazil,
A company of platforms Chile and Colombia
1990
100% acquisition
in Argentina, Chile,
2010
Peru and Brazil Acquisition of controlling
Enters in Telefónica Tech acquires Cancom
stake in Vivo
Chile (CTC) and
Argentina (TASA) Enters in Mexico: 2016 2018
acquisition of Bajacel,
Movitel, Norcel and Cedetel
2012 Creation of Telxius Pontegadea enters
in Telxius
Telefónica Deutschland’s
IPO
1998 2005 2020 2022
Telefónica wins the tender
for Telesp in Brazil
Acquisition of
Cesky Telecom 2017 2019 Telefónica Brazil launches, Green light to
Announcement of sale together with TIM and the sale of Oi's
TEF reaches a stake
1994 2003 69.2%, at Telefónica of assets in Claro, a bid to acquire mobile assets
Telefónica enters JV with PT in Brazil: 2014 Deutschland following Central America Oi's mobile business,
amounting to
to Telefónica
and its
Vivo agreement with KPN (closing in
to Peru (TdP) Disposal of 16.5 billion partners
2021 y 2022)
Telefónica Brazilian reals
1987 2004 Czech Republic and Ireland 5 key points
that will mark Creation of JV
Listing on Acquisition of Bellsouth Acquisition of the new Telefónica with Allianz
New York Stock Exchange LatAm assets E-Plus in Germany
for fibre rollout
in Germany
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.
Telefónica at a glance Accesses by market
➢ Telefónica operates in 12 countries.
Germany
➢ The company offers telco services 50.2 Mn
and digital solutions in more than
170 countries via strategic partner UK
agreements. 55.9 Mn
Spain
40.1 Mn
2%
Brazil
103,934
20% 29%
Hispam 98.8 Mn
Revenues
110.4 Mn
15% 2021 18% Argentina, Chile, Colombia, Ecuador, México, Perú,
Uruguay and Venezuela. employees
16%
Spain Germany Brazil
Hispam Infra UK
Group 369.1 Revenues* from key
78% 87%
Mn accesses OIBDA* from key
markets:
2021 39,277 €Mn FY revenues
Spain, UK,
Germany & Brazil
markets
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA. * Weights calculated with revenues and OIBDA underlying with 50% of the VMO2 JV since June 2021
A leader in telecom infrastructures,
offering best-in-class digital ecosystems and content
#1 global leader in UBB Best-in-class digital
deployment, excluding China* ecosystems & content
* Fuente: Analysys Mason
159 Mn premises passed with UBB
84.5 Mn premises passed through own
network Finance Connectivity CONTENT
OTTs
Home Well-being
➢ 80% ➢ +300 4G
5G Coverage Entertainment
locations
Coverage 99% in Europa
➢ 30% ➢ 14 cities
with DSS 82% in Latam
of processes
Open RAN 80% digitised
#1 copper network shutdown
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.
ESG, at the heart of the company’ strategy
Building a greener future Helping society to thrive Leading by example
Net zero emissions by 2025 Driving connectivity Restructured
in main markets, and in all the value chain by 2040
Board of Directors
Rural coverage 90-97% 2024
15 members, 60% independent,
Energy consumption
100% Gigabit Internet for All
33% women
-90% renewable energy
2025 2030
Global Innovation & Talent HUB Privacy and security centres
Circular Economy 33%
Zero Waste 2030 More inclusive female #1 leader in digital rights
workplaces managers
2024
Reskilling
A-List CDP New flexible and
& Upskilling
digital ways of
Digital skills
working 100% suppliers under
Empowering our clients development
sustainability standards
to decarbonise #1 worldwide Telco sector in
Digital Inclusion 2024
ESG financing: Target >€10.000 Mn over the next years
Contribution to GDP €48,904 €23.3 out of
Total Tax
For every euro generated in direct impact, we have
Contribution to employment 1.2 Mn Contribution €9,134 Mn every €100 is spent on
generated an additional €2.3 in indirect and induced
impact through expenditure and investment * Mn taxes.
* in 9 main countries
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.
Building a company
for the future
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.
Strategy based on 5 key points
1 Spain, Brazil, Germany and UK, core markets
Core Telefónica Telefónica
markets Tech Infra
2 Reduced exposure to Hispam
New operating
model 3 Telefónica Tech, a global digital business
Telefónica Infra, growing global
Telefónica
4 infrastructure business
HispAm
Streamlined & digital operating model
5
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Core markets,
with the best technological platforms and advanced digital services
#1 Fibre #1 Fibre 5G 5G
➢ >80% premises | ~27 Mn PPs* ➢ 19.6 Mn PPs ➢ 30% coverage
➢ #1 industrial 5G private ➢ 300 towns and cities
network ➢ Target: 50% coverage in 2023
#1 5G #1 5G-DSS
➢ >80% population ➢ Launched in 14 cities
Excellent network
➢ Very Good Fibre deployment
New fibre vehicle
#1 Advanced services ➢ Up to 7 Mn greenfield PPs
➢ Target: >5 Mn PPs in low in 2027
density areas ➢ Gigabit network upgrade
#1 OpenRAN
completed
#1 TV Platform
UGG
#1 Advanced services ➢ Fibre company,
VMO2
Mobile assets
wholesale and neutral ➢ Connectivity champion
➢ More spectrum and leadership
Growing NPS in main markets
* PPs: Premises passed
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Telefónica Tech,
accelerating our sustainable fastest-growing business
Revenue
~1,000 +34% +50% Scaled and enhanced capabilities
€Mn y-o-y Q4 21
Best-in-class global partners > 300
Enhanced SMB offer Agreement on
Cross-selling
in Spain and Hispam Hybrid Cloud
Cloud &
Cyber Industry recognition:
Expanding
partnerships
8x leader in IoT connectivity
Strong momentum in Big Data,
Connected Car, Industry 4.0… Video Analysis Excellent in
IoT & & IA Security Services
Big Data
IoT connectivity revenue Leader in Security Managed
+19% y-o-y Services in Europe
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Telefónica Infra,
growth and optionality
Fibre vehicles Growth and optionality ahead
2021 Targets (PPs /Premises passed) Fibre Mobile sites
➢ First customer ➢ 55.8 Mn PPs
UGG connected in June ➢ > 2 Mn PPs in 6 with own network ➢ CTIL: 15.9 k
2021 years ➢ Group (ex UK): 27 k
➢ UK /Target: up to 7 Mn
greenfield PPs
➢ España / Target: >
FiBrasil ➢ 2 Mn in 2021 ➢ > 6 Mn PPs in 4 years 5 Mn PPs focused
in lower density areas
ON’NET Submarine cable Data centres (Nabiax)
➢ c. 1 Mn in 2021 ➢ 3,5 Mn PPs in 2022
Fibra
➢ 94k km – new ownership ➢ 14 data centres
agreed (T. Infra 70%, ➢ T. Infra: 20% post
➢ Closing after Pontegadea 30%) execution of 2nd closing
InfraCo approvals in January ➢ c. 4,3 Mn in 3 years ➢ 13 submarine cable (2022E)
2022 systems
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.An Open Innovation Model
Based on excellent network connectivity, it combines in-house and third parties’
innovation capabilities
Core Innovation Connected Open Innovation
835 Mn €
R+D Investment* Applying innovation to Telefónica's assets, creating Boosting the entrepreneurial ecosystem
new products to enhance our competitiveness
We innovate by leveraging Telefónica's own
Top 50 platforms in areas of the company not
accessible to third parties due to their strategic
nature: data, network, home platforms, etc.
EU companies +1,000 +130 +2,500 Mn€
R&D Investment** We have created new businesses such as Startups Startups working Third-Party
Internet for All (wireless internet in remote rural in portfolio with Telefónica investment
areas), programmatic advertising and the
blockchain unit, among others.
421 We are currently focused on the new
+190 €Mn 8 29
Technological Invested Wayra 2 Open Future
opportunities that will emerge in metaverses, Hubs
Industrial Property web3, cloud networking, 5G private networks and
Hubs
Rights assets gaming. en Europa & Latin America
* Data 2021
** Industrial R&D Investment Scoreboard 2021
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.2021 Highlights ***Este documento está clasificado como PUBLICO por TELEFÓNICA. ***This document is classified as PUBLIC by TELEFÓNICA.
Solid results:
Enabling sustainable growth / Strong balance sheet
Revenue Solid x5 Net Debt Strong increase
growth OIBDA Net Income Significant reduction Equity
8,137 26,032
+2% +1.4% € Mn 22k €Mn
€Mn (-26%)
In all Margin 1.38€ 50%
x2 y-o-y
business units 33.5% EPS vs. June 2016
Organic growth in revenue and OIBDA vs. 2020. Organic margin OIBDA. Equity attributable to shareholders of Telefónica SA.
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Strong FCF and significant debt reduction
Atractive shareholders remuneration
FCF*
Net Debt
3,755
€Mn 2021
26,032 €Mn
* ex spectrum
Atractive shareholder remuneration policy
52.2
35.2
1.38€ 2.41% 26.0
treasury stock to be
cancelled
0.30€
Jun 16 Dec 20 Dec 21
LIQUIDITY AVG. DEBT LIFE INTEREST
EPS Dividend POSITION
2021 per share
24.6 13.6 PAYMENT COST*
€Mn
years 3.86%
2022 dividend will be €0.30/share, payable in cash, in two tranches, December 2022 (€0.15/share) and June 2023
(€0.15/share). * Ex lease interests
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Telefónica España:
The most advanced telco in Europe
Results FY 2021* Leading in FTTH connected homes
#1 +
➢ Premises passed: c.27 Mn Higher value
Revenue
➢ Connected homes: 42.4%* customers
12,417 €Mn * Analysys Mason
+0.1%
Uptake of fibre customers
#1 TV Platform leading in technology connected to own network:
OIBDA
(IPTV/OTT), content and customer
3,377 €Mn
experience 29% | +0.5 p.p. y-o-y
-5.3%
OIBDA Margin #1 Leading in mobile network speed and TV
+38.8% quality
3.7 Mn | (5.5 %)
* y-o-y changes in organic terms.
➢ 80% population covered with 5G
The most compelling offer across all market segments Mobile contract
#1 Movistar, the most valued brand*
15.2 Mn | (1.1%)
➢ Record NPS (36%)
The best B2B and B2C technological
partner to foster digitalization * Kantar/Millward Brown
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Telefónica Germany:
Strategy based in a continuous and improved network expansion
Results FY 2021*
Customer Focus
Revenue
capEx record
7,765 €Mn c. 1,300 €Mn +17.3% 3G switch-off
+3.1% completed
Mobile accesses
OIBDA 45.6 Mn
2,424 €Mn
-97%
+4% 5G Reduced Scope 1 & 2
>30% emissions since 2015
OIBDA coverage
Dec 2021
Margin Target: 50% in 2022
+31.2% ESG recognition
* y-o-y changes in organic terms. #1 Open RAN
Focused in customer satisfaction and digital transformation
Digital4Growth Program (2019-2022): Network quality
Very Good
Connect Magazine
2021
SIMPLER FASTER BETTER
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Virgin Media O2 UK:
Upgrading the UK, reimagining connectivity
Results FY 2021*
#1 55.9 Mn
Revenue 100% Gigabit total accesses
12.046 Mn € network upgrade
-1.2%
5G available in
Lightning project >300
OIBDA towns & cities
2.7 Mn premises
4.178 Mn € passed / largest
Target: 50% of
population in 2023
+2% contributor to Government
gigabit target
Network quality
OIBDA
Margin
Best network coverage More reliable UK
+34.7% & Fastest network mobile network
Committed with provider
* Organic OIBDA and OIBDA margin y-o-y calculated in line with Telefonica criteria. fibre
Includes VMO2 proforma data which give effect to the combination of Virgin Media UK and O2
UK as if it had occurred on 1st January 2020 and pushes back purchase price accounting,
Target: up to 7 Mn
policy alignment and transaction adjustments to this date. greenfield in 2027
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Telefónica Brasil:
Differential assets & leadership in value
Results FY 2021*
Most recognized and valued brand
Revenue Total accesses
6,910 Mn € Consolidation. 99 Mn #1 Sustained leadership in mobile contract
segment (37% of market share)
+2.1% The operation will
improve the quality
Record in mobile accesses 5.5 Mn accesses (FTTx/Cable)
of the mobile 83.9 Mn +6.9% 4.6 Mn accesses FTTH (+36.4%)
network in Brazil
OIBDA
3,138 Mn €
Fibre vehicle, neutral and
#1 Largest fibre
deployment in LATAM
Mobile network
+1.8% Coverage and capacity
wholesale
Premises passed with fibre
(FTTx) 27.4 Mn
➢ 2 Mn premises passed in 2021
OIBDA ➢ Target 2024: 6.4 Mn premises passed
Target: 29 Mn in 2024
#1 Largest 3G/4G mobile network coverage
Margin
➢ 5G DSS available in 14 cities
-45.4%
#1 Fibre market leader,
with 4.6 Mn accesses ➢ Largest distribution channel: 1.700 shops
* y-o-y changes in organic terms.
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Telefónica HispAm:
Profitable growth / Modulating exposure to the Region
Results Revenue
Argentina
FY 2021* 8,362 €Mn +5.1%
Chile
Capital employed
Colombia
OIBDA México reduction
1,718 €Mn +3.4%
-22%
Ecuador
Perú
Uruguay
OIBDA-CAPEX
Venezuela
740 €Mn +2%
* y-o-y changes in organic terms.
Operating highlights FY 2021 ➢ Portfolio simplificación & cristalization of
value
Total accesses 94.6 Mn Mobile accesses FTTH (+25%) NPS improvement Sale of Costa Rica Fibre
agreements in
& El Salvador
110.4 €Mn +8% Contract customers
➢ 12.3 Mn premises passed
in the Region EV/OIBDA >7x Chile & Colombia
➢ 82% deployment through third
parties ➢ Increased % of debt in local currencies
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Telefónica’s milestones in the last two years
7 May 30 Jul. 29 Oct. 1 Jun. 9 Feb.
28 Jul. 22 Feb. Launch day of
Telefónica Brazil Telefónica presents JV creation with Sale of Oi's
Telefónica and FibraCo Chile: Virgin Media O2, the JV
launches, its proposal for a Allianz for mobile assets
Liberty 60% sale set up by Telefónica and
together with TIM and Digital Pact, which was deployment of to Telefónica
Global come together a KKR. Liberty Global
Claro, born fibre in Germany. and its
to create the leading
an offer to purchase with the aim of being partners
fixed-mobile
Oi's mobile business, the roadmap for the approved
provider in the UK.
16,500 digitisation of SMEs, 19 Jul.
million reais self-employed and
InfraCo Colombia:
Brazilians. Administrations
sale of 60% to KKR
public.
2020 2021 2022
02 Mar.
1 Sep. Creation of
FiBrasil, 19 Oct.
7 Feb. 14 Dec. neutral
Execution sale of
30 Jul. Telefónica switches on
5G in Spain and Telefónica Brazil and
wholesale
Creation of the
Global Innovation and
1,900 towers to
Telxius Torres Brazil.
Telefónica sells
its business in
will reach 75% of the
country's population
its partners ,TIM and 13 Jan. supplier
of
Talent Hub
Sure, win the auction
Costa Rica to this year. of mobile assets
Sale of the
tower business
fibre. 29 Jul.
Liberty Latin of Oi. Telefonica Tech
27 Nov. America for 425
million euros.
from Telxius to
American Towers... buys Cancom
5 key decisions plan (closure in 2021).
that will mark the new
company's time.
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Fundación Telefónica
Fortune 2020
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.Fundación Telefónica,
the social side of a digital era
Innovation
& Talent
Employability Education
HUB Programs aimed at:
✓ Teachers
✓ Families/ Youth/ Children
ORIENTATION TRAINING ✓ Social organisations
✓ Employment map ✓ Online Madrid/Bilbao ✓ Educational centres
✓ Virtual orientator ✓ Face-to-face Barcelona/Málaga ✓ Reducing social gap in disadvantaged
PROJECTS:
environments
41 countries
COLABORATION:
+ 500 organisations
+ 100 public administrations
Social action & Volunteering Disseminating Digital Culture
>60,000
Digital ✓ Events & conferences
transformation volunteers ✓ Publishing
of social s ✓ Exhibitions & workshops
organisations
***Este documento está clasificado como PUBLICO por TELEFÓNICA.
***This document is classified as PUBLIC by TELEFÓNICA.***Este documento está clasificado como PUBLICO por TELEFÓNICA. ***This document is classified as PUBLIC by TELEFÓNICA.
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