investor presentation january, 2018 - cablevision holding sa · source: dataxis, nextvlatam,...

Investor PresentationJanuary, 2018

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Forward Looking Statements

The information contained herein has been prepared by Cablevisión Holding S.A. (“CVH”) solely for use at this presentation. The

information herein is only a summary and does not purport to be complete. This presentation is strictly confidential and may not be

disclosed to any other person.

This presentation has been prepared solely for informational purposes and is not an offer to sell securities of CVH and we are not

soliciting offers to buy or sell securities of CVH in any jurisdiction. You are not authorized to rely on any statements included in this

presentation to purchase or sell securities of the company. Cablevision takes no responsibility in this regard. No representation or

warranty, either express or implied, is made as to the accuracy, reliability or completeness of the information presented herein. This

material should not be regarded by recipients as a substitute for their exercise of their own judgment.

Certain information included in this presentation may contain projections or other forward-looking statements regarding future

events or the future financial performance of Cablevision Holding SA. within the meaning of section 27A of the Securities Act of

1933 and section 21E of the Securities Exchange Act of 1934. You can identify forward-looking statements by terms such as

“expect”, “believe”, “anticipate”, “estimate”, “intend”, “will”, “could”, “may” or “might” the negative of such terms or other similar

expressions. These statements are only predictions and actual events or results may differ materially or they are not guarantees of

future performance. CVH does not undertake or intend to undertake any obligation to update these statements to reflect events and

circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the

actual results to differ materially from those contained in CVH’s projections or forward-looking statements, including, among others,

general economic conditions, CVH’s competitive environment, risks associated with operating in Argentina, rapid technological and

market change, and other factors specifically related to CVH and its operations.

This material does not constitute, in whole or in part, and offer. Neither this presentation nor anything contained herein shall form

the basis of any contract or commitment whatsoever.

While figures for 2011, 2012, 2013, 2014, 2015 and 2016 have been prepared in accordance with International Financial Reporting

Standards (“IFRS”), previous years figures were prepared in accordance with Argentine GAAP.2

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Company History

Business Overview

Transaction Summary

Q & A

Appendix

4

Company History

CVH (BCBA: CVH / Level 1 US: CVHSY ) was created as a new independent company by the split up of the Pay TV,Broadband and Mobile businesses of Grupo Clarín (BCBA/LSE: GCLA). Substantially all of its assets consist of itsownership interest in its subsidiary Cablevisión, which provides a wide range of cable television, data transmission,internet and mobile services.

Cablevisión is the #1 Pay TV company in Argentina (3.5mm subs with 38% Market Share) & #1 broadband provider inArgentina (2.3mm subs with 32% Market Share).

CVH started trading in the Buenos Aires Stock Exchange on August 30, 2017 and requested listing admission in theLondon Stock Exchange (LSE).

The listing admission (LSE) is expected to be complete by 1Q 2018, subject to certain regulatory approvals.

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2016 2018

Technology Convergence & Regional Expansion

Split-up CV AssetsPure Telecommunication Player

First Fully Convergent Telco in Argentina

2007

60.00% 39.08%60.00%

Other Media Companies

100.00%

On January 1st, 2018 Telecom Argentina and Cablevisión merged to create the first fully convergent Telco in Argentina*.

* For more information see Transaction Summary on pages 15 -16

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Company History

Business Overview

Transaction Summary

Q & A

Appendix

$60,641

$1,225 Market Size

(2018)1

Pay-TV and

Broadband

Key

Metrics

(2016)

Argentina

Fixed

Broadband

and Pay-TV

Subscribers

Evolution

(mm)

$9,811

3.0%

$305

$16,442 $7,286

16.712.7

79.6

80.2

28.7

33.2

27.2

54.4

21.554.159.669.1 26.9 39.0

$15,128

3.6% 2.7% 2.5%2.1% 4.2% 2.7%

2.43.1 3.5

4.04.6

5.26.2

6.6 7.0 7.2

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

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Source: The Economist Intelligence Unit, Kagan (Jan-2018), and GS ResearchNote: GDP size and GDP per Capita in nominal terms and PPP weighted. GDP growth reflects real GDP growth. CAGR figures are from 2007 to 2016.1 Information obtained from GS Research. 2 Considers only occupied households.

Growth Industry Opportunity in Broadband, Premium and Digital TV and Mobile (4G)

Argentina Brazil Mexico Colombia Chile Peru

GDP Size (US$bn)

GDP per Capita (US$)

GDP Growth (Y/Y)

Pay-TV Penetration (%)

Broadband Penetration (%)

Mobile (4G) Penetration (%)

# of Households2 (mm)

6

Broadband Subscribers Pay-TV Subscribers

Argentina Pay-Tv, Broadband and Mobile (4G) Market

US

6.26.7 7.1 7.3

7.8 8.2 8.6 8.9 9.0 9.2

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

$2,243 $325 $235 $20,315

$10,708 $6,524

$668

122.38.45.713.932.9

15.8 30.4 89.8

21.645.438.342.4

13.3 69.9

Cablevisión FootprintIn

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High quality, high capacity network, covering a very attractive customer base

¹ All Internet subscribers are included for internet, as of September 2017.2 as of September 2017.(*) Taking into account only Cable TV and Internet subs.

Source: Company Information7

Services

Argentina & Uruguay

7.9MM homes-passed (79% 2-way)2

50,907 km2

44.6% CATV o/HHPP2

37.0% Internet o/HHPP 2W2

3,918,503 Unique Subs(*)

3,508,090 CATV2

2,297,346 Internet2

2,002,341 Digital2

855,136 Total Mobile Subs (65% postpaid)

Coverage & Network

Subs

Penetration

Cable and Digital TV

Broadband

Exhibit 1: Geographic Footprint & Subs1

Thousands Subscribers

CATV: 144.4Internet: -

International

CATV: 510.9Internet: 267.4

Litoral


Centro


Buenos Aires

CATV: 1,502.4Internet: 1,217.0

AMBA

Mobile Telephony

FinancialsFY16 Sales: US$ 2,068FY16 Ebitda: US$ 740 3Q17 ARPU: US$ 48

ARPU: Revenues (excl Nextel) / Average Unique Customers / Average FX Rate

FX 2016: $14.79; 9M17: $16.26; 3Q17: $17.29

79%

21%

81%

19%

73%

27%

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8

HighGrowth

Potential

% Broadband Subscribers

Exhibit 2: Pay-TV Market Share Exhibit 3: Broadband Market Share

% Households

Exhibit 4: Cablemodem Growth Potential

*Competition Areas, Argentina only.Source: Company Information, as of September 2017

1.7MM 1 Way

7.9MM Homes Passed*

Cablevisión is leader in Pay-TV and Fixed broadbandWe believe we have the best product to capture the growth of the broadband market

Expand Coverage of 2-Way TechnologyDocsis 3.0 technology

Ultra Broadband Value added services

2 Increase Broadband Penetration

Bandwith Upgrade Cross-selling Broadband to Pay Tv Subs

1

Source: Dataxis, Nextvlatam, Company Information; Pay-TV refers to Cable TV, as of September 2017. Source: Dataxis, Nextvlatam, Company Information, as of September 2017.

% Pay-TV Subscribers

3.9MM Unique Clients

6.2 MM2 Way

0.8MM1 Way

3.1MM2 Way 2.3MM

CM Subs

0.9MM Only Pay TV

3.1MM Clients 2 Way

Cablevisión SA

Directv

Others

Cablevisión SAOthers

Telecom

Telefónica

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9

Exhibit 5: Strong Growth Across Cablevisión Products

Source: Company Information, as of September 2017* Revenues (excl Nextel) / Average Unique Customers / Average FX Rate

Unique subscribers (‘000)

3,716 3,645 3,761 3,792 3,874 3,912

Exhibit 6: Revenue Breakdown FY16

Exhibit 8: Revenue Breakdown 9M17

Pay-TV

Broadband

Premium, digital & others

Mobile

4841

4540383938

4Q124Q11 3Q174Q16

+4%

4Q154Q144Q13

Exhibit 7: Total ARPU *

US$

Pay-TV

Broadband

Premium, digital & others

Mobile

3,919

Offering Attractive Cross-Selling Opportunities

Note FX 2007: $3.11; FX 2008: $3.16; FX 2009: $3.73; FX 2010: $3.91; FX 2011: $4.13; FX 2012: $4.55; FX 2013: $5.48; FX 2014: $8.12; FX 2015: $9.27; FX 2016: $14.79; FX LTM: $16.06.

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Key figures

1 Figures for 2011, 2012 , 2013, 2014, 2015, 2016 and 2017 have been prepared in accordance with IFRS

Source: Company Information.

10

Exhibit 9: CATV Subscribers

Thousands

Exhibit 10: Broadband Subscribers

Thousands

Exhibit 11: Revenues1

US$ MM

Exhibit 12: EBITDA1

US$ MM

3,528

+2%

3,193

20082007

3,191

2009

3,022

2013

3,533

20122011 20142010

3,4913,358 3,4933,490 3,405

2015 3Q17

3,508

2016

977923726

2007 20092008 2012 20142013

1,489

2011 2016

1,119

2,180

1,343

+12% +8%

20152010

2,297

1,699 1,828

3Q17

2,018

840

2,374

1,081

2007 2008 LTM2013

+11%

201620152012

1,779

2,171 2,068

1,671

2011

1,476

2010

1,249

2009

1,131

2014

1,752873

739787

578520529475468407378

286

2011

+12%

2016 LTM20132009 2010 20122008 201520142007

EBITDA Margin (%)

34.1

35.036.0

32.2

37.5 31.7

29.2

36.233.0

35.8

36.8

Consistent Subs and Financial Growth


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11

Our subsidiary Cablevisión SA (“CV”) has invested more than US$3,500 MM in Capex since 2007 mainly to generate growth and to improve margins

Exhibit 13: Network Capacity

Exhibit 15: 9M17 CAPEX Breakdown

Exhibit 14: CAPEX

2W79%

DVB*5%

750MHz >16%

* Digital Technology for Lower Income Neighborhoods

Source: Company Information, Argentina Only as September 2017 Source: Company Information

US$ MM

CV CAPEX

Installations49%

Source: Company InformationSource: Company Information

450

292324284341

224237164 153

0

200

400

600

800

0

5

10

15

20

25

30

2014

17%

2013

18%

2012

17%

2011

23%

2010

18%

2009

14%

2008

22%

2007

20%

LTM

28%

661

2016

589

28%

2015

21%

Exhibit 16: EBITDA - CAPEX

US$ MM

212

150

337

286

196235

158

244254

141122

2016 LTM20152014201320112010200920082007 2012

Capex/Sales

Capital Expenditure (CAPEX)


Maintenance20%

Networks, New Technologies & others31%

Financial Debt

Source: Company Information(1) CVH: Last Quarter Annualized EBITDA. CV: LTM EBITDA. Exchange Rate as of September 30, 2017: 17.31 ARS/ USD. * Does not include Interests.

12

Exhibit 17: CVH Debt Profile as of September 30th, 2017

US$ MM, Balance Sheet

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Exhibit 18: CVH Key Financial Ratios

5M17

Total Financial Debt* 23,331

Cash And Cash Equivalents 14,937

Total Net Debt 8,394

Net Debt / Adj EBITDA1 0.56x

Exhibit 19: CV Key Financial Ratios

9M17 9M16 YoY

Total Financial Debt* 10,307 9,313 10.7%

Cash And Cash Equivalents 2,482 2,775 (10.6%)

Total Net Debt 7,825 6,538 19.7%

Net Debt / Adj EBITDA1 0.56x 0.58x NA

1,348 MM at 17.31 ARS/ USD

752750

595

501

2

47

Total

16

24774

2018

1

2022

1

1,348

501

2020

9

2021

947

20192017

13

CVH

Cablevisión

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Company History

Business Overview

Transaction Summary

Q & A

Appendix

CVH shall have the right to appoint the majority of the members of the Board of Directors, Executive

Committee, Audit Committee and Supervisory Committee.

Scheme of special majorities for the approval of certain matters by the Board of Directors and/or the

Shareholders.

The Agreement provides rights of first refusal, tag along and drag along.

14

Call Option

On July 7, 2017, the company signed a Call Option for the acquisition of a direct or indirect participation

equal to 13.51% of Telecom pre merger, approximately 6% of the surviving entity. Call Option exercise price

of USD 634,275,282 and the maximum term for the exercise of the call option was one year counted as

from July 7, 2017.

On September 25, 2017, CVH received a loan by Citibank, N.A., Goldman Sachs Bank USA, Industrial and

Commercial Bank of China Limited, Dubai (DIFC) Branch and Itaú Unibanco S.A., Nassau Branch of a principal

amount of USD 750,000,000. The maturity date is 18 months after the date of disbursement.

The funds from the loan were used, among other things, to prepay the Exercise Price under the Option

Agreement signed by the Company. The CVH payment was made on October 5, 2017 and the call option

was exercised on December 27, 2017.

Shareholders’

Agreement

Transaction OverviewLatest Events – CVH & Cablevisión SA

Merger

Agreement

Shareholders of Cablevisión and Telecom Argentina (“TEO”) approved on August 31, the “Pre-Merger

Commitment” whereby Cablevisión will merge into Telecom Argentina subject to certain regulatory

approvals. On December 21, 2017 ENACOM approved the Transaction.

Exchange ratio: 9,871.07005 new shares of Telecom Argentina issued in exchange for each common share of

Cablevisión with a nominal value of Ps. 10,000 per share.

On January 1st, 2018, Telecom Argentina issued 1,184,528,406 new common, book entry shares with a

nominal value of Ps. 1 and one vote per share, to the shareholders of Cablevisión.

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15

Merger Summary and Capital Ownership IIn

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Cablevisión S.A., in an all stock transaction, was absorbed by Telecom Argentina

Cablevisión S.A. shareholders received1,184.5mm new shares of Telecom Argentina

All resulting company share classes have equal economic and voting rights

Cablevisión shareholders received 55% of the combined company shares

Reference equity values of US$6.1bn for CV and US$5.0bn for TEO

Transaction Summary

Post-Merger1,2

FintechMedia

60.0% 40.0%

FintechTelecom3

FintechMedia 6 Float 4 5

33.0% 29.2%15.8%22.0%

Simplified ownership structures

Pre-Merger structure1

FintechTelecom3 FloatANSeS

20.4% 19.0%

Former NortelPref. Stock

Class B

25.4%35.2%

Class B shares – Total Float

1Pre-transaction ownership structure of TEO after the reorganization of Telecom Argentina, Telecom Personal, Nortel Inversora and Sofora Telecomunicaciones2After the reorganization of Telecom Argentina and illustrates the ownership structure of the combined company3Only includes Fintech Telecom ownership through Sofora Telecomunicaciones4 Float includes former Nortel Preferred Class B shares and shares held by the ANSeS

5 The Float includes 8.3% own by Fintech Telecom

6 Through a Corporate reorganization, Fintech Telecom absorbed Fintech Media

16

The CEO and other Key Employees (other than the CFO and the Internal Auditor) to be designated by the Board of the Company shall be a person proposed by CVH

The CFO and the Internal Auditor of the Company to be designated by the Board of the Company shall be a person proposed by Fintech Advisory

Dividend Policy: Distribution of cash dividends in each calendar year in an amount equal to the greater of (i) 50% of the Company’s Excess Cash for the prior fiscal year and (ii) US$300 million

Indebtedness Policy: Maintain a Gross Debt to EBITDA ratio of no less than 1.5 and no greater than 3.0. Target: 2 times

Shareholder Agreement

1 Through a Corporate reorganization, Fintech Telecom absorbed Fintech Media

Post-call option and current Capital Structure

Float

39.1%

31.7%

29.2%

Fintech Telecom 1

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Telecom Argentina Float Structure

Total Float 29,16%

ANSES

Fintech Telecom

Free Float

11,42%

8,30%

9,43%

Merger Summary and Capital Ownership II

17

1 Proforma, unaudited. Combines the revenues and EBITDA figures reported by both Companies. Values in US$ calculated at a rate of P$16.06 = US$1.00, using as a reference the U.S. dollar ask rate published by the Banco de la Nación Argentina and calculated using the average of such FX rate of the last 12 months as of 3Q17.; 2 Considers the sum of number of clients reported by both companies.Source: Company filings

2.4

6.2

Telecom Cablevision Pro-forma

1.1 0.92.0

Telecom Cablevision Pro-forma

EBITDA margin

+ +

29.9% 32.5%36.8%

3.8

Fixed BB19%

Fixed Voice8%

Data & Others

4%

Mobile38%

Pay TV23%

Devices8%

Total revenues:US$6.2 Bn

3.8mmsubscribers

20.0mmsubscribers

3.5mmsubscribers

4.1mmsubscribers

Merger Key Figures (LTM 3Q17)

Exhibit 20: Revenues Exhibit 21: EBITDA

Exhibit 22: 3Q17 Combined revenues breakdown Exhibit 23: Combined clients by segment in Arg.

US$ BN US$ BN

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Company History

Business Overview

Transaction Summary

Q & A

Appendix

Ownership Structure

20Source: Company Information

Cablevisión Holding2 S.A.

% Economic Rights% Voting Rights

Class A Shares Class B Shares

44.55%

21.65%

26.44%

64.25%

Class C Shares

6.52%

3.17%

22.49%

10.93%

Class B Shares

39.08%

39.08%

PrincipalShareholders1

FloatGS

Unidos

PrincipalShareholders

Shareholder Structure3

Number of Shares

Total 180,642,580

Free Float 40,626,708

• International (52%)

• Local (48%)

Controlling Shareholders 140,015,872

1 Controlling Shareholders: The 1999 Ernestina Laura Herrera de Noble New York Trust, HHM Media New York Trust, The LRP New York Trust, GC Dominio S.A and José Antonio Aranda2 CVH shareholders acquired approximately 12.5% of the free float3 As of November 10th, 2017

100.00%

100.00%

22,5%

Free Float

77,5%

ControllingShareholders1

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Combined Figures

Revenues LTM

EBITDA LTM

3,842

1,150

2,374

873

Net Debt (29) 452

Net Debt / EBITDA LTM

EBITDA - Capex

423

2,023

6,216

(0.03x) 0.56x

212

0.23x

719

TEO(1) CVSA(2) Combined(3)

Capex LTM

507

661 1,304

In US$mm – Period ended September 30, 2017

(1) Please refer to Telecom Argentina SA Financial Statements (http://www.telecom.com.ar/inversores/financiera.htm) and CNV filings available at http://www.cnv.gov.arhttps://www.sec.gov/Archives/edgar/data/932470/000090342317000496/tm6k_0810.htm(2) Please refer to Cablevision SA Financial Statements (https://institucional.cablevisionfibertel.com.ar) and CNV filings available at http://www.cnv.gov.ar. Gross and net debt include accrued Interest.(3) Combined figures are the result of the sum of each of the indicated figures for each of TEO and Cablevision as appear in each of their respective financial statements as of September 30, 2017 and for the six-month period ended September 30, 2017. (4) Gross Debt / EBITDA and Net Debt / EBITDA ratios calculated taking into consideration figures in Argentine Pesos in the last twelve months as of 3Q17.Values in US$ calculated at a rate of P$16.06 = US$1.00, using as a reference the U.S. dollar ask rate published by the Banco de la Nación Argentina for wire transfers (divisas) and calculated using the average of such FX rate of the last 12 months as of 3Q17, except for Net Debt which has been converted at a rate of P$17.31 = US$1.00, wich was the exchange rate quoted by Banco Nación for wire transfers (divisas) on September 30, 2017.

Telecom Argentina is a publicly registered company in the United States and Argentina and all of the information with respect to Telecom Argentina has been obtained from certain filings with the SEC and CNV prior to the date of the Proxy Solicitation and other public information Telecom Argentina has disclosed to its investors. None of us or the Solicitation Agent have participated in the preparation of such information or verified its accuracy or completeness. None of us or the Solicitation Agent shall have any responsibility for the accuracy or completeness of the information disclosed by Telecom Argentina in such filings or publicly available information or included in this Proxy Solicitation.

Ratios(4)

643

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Gross Debt / EBITDA LTM 0.64x 0.74x 0.68x

Gross Debt 682 602 1,284

http://www.cnv.gov.ar/

http://www.cnv.gov.ar/

22

CVH Income StatementFIVE MONTHS (5M) AND THIRD QUARTER (3Q) 2017

Revenues & EBITDA1 5M17

AR$ MM

Source: Company Information

Income for the period 5M17

AR$ MM

2,0415M17 1,148 893

Equity Shareholders Non-Controlling Interests

1 We define Adjusted EBITDA as net sales minus costs of sales (excluding depreciation and amortization) and selling and administrative expenses (excluding depreciation and amortization)

EBTIDA Margin (%)

EBITDA

6,300

Selling & Adm.

Expenses

Cost of Sales

6,490

17,225

4,436

Net Sales

36.6

Revenues & EBITDA1 3Q17

Income for the period 3M17

EBTIDA Margin (%)AR$ MM

Net Sales EBITDA

4,008

Selling & Adm.

Expenses

Cost of Sales

3,727

2,810

10,545

AR$ MM

1,2823Q17 565717

35.3

Equity Shareholders Non-Controlling Interests

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Cablevisión SA Income Statement3Q17 & 3Q16 yoy figures

Revenues

% yoy, AR$ MM

Adjusted EBITDA1

% yoy, AR$ MM

1 We define Adjusted EBITDA as net sales minus costs of sales (excluding depreciation and amortization) and selling and administrative expenses (excluding depreciation and amortization)

IDEN Telephony

Pay TV and Internet Access

805

1,033

3Q173Q16

7,995

6,962

10,544+32%

9,739

Income for the period 3Q17 vs. 3Q16

AR$ MM

+17%3Q17 1,348

3Q16 1,155

35.5

EBTIDA Margin (%)

3,7485

3Q16

2,839

2,700

139

3,743

+32%

3Q17

35.5

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Cablevisión SA Income Statement3Q17 & 3Q16, yoy figures

3Q16

AR$ MM

3Q17

AR$ MM

Source: Company Information

Revenues

2,839

3,117

7,995

Cost of Sales

2,039

EBITDASelling & Adm.

Expenses

3,748

2,789

EBITDARevenues Cost of Sales

Selling & Adm.

Expenses

4,007

10,54432%

29%

37%

32%

35.5

35.5

EBTIDA Margin (%)

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1Excludes 15,221,373 treasury shares; 2Determined only with the objective of adjusting the exchange ratioSource: Company filings

Telecom Argentina S.A. shares1 969,159,605

Telecom Argentina S.A. resulting ownership in combined entity 45%

New total shares outstanding 2,153,688,011

Shares to be given to Cablevisión S.A. shareholders 1,184,528,406

Total shares outstanding of Cablevisión S.A. 120,000

Agreed exchange ratio: Telecom Argentina S.A. shares for each Cablevisión S.A. share 9,871.07005

Reference Equity values2

Reference Equity Value of Telecom Argentina S.A. (US$mm) 5,000.0

Reference Equity Value per share for Telecom Argentina S.A. in US$ 5.15911

Reference Equity Value of Cablevisión S.A. (US$mm) 6,111.11

Reference Equity Value per share for Cablevisión S.A. in US$ 50,925.93

Calculation of Exchange RatioIn

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Investor PresentationJanuary, 2018

[email protected]

investor presentation january, 2018 - cablevision holding sa · source: dataxis, nextvlatam,...

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