Imara African Cement Report Africa, the last cement frontier Angola ...

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UNITEL EBITDA 2010 Portugal Telecom EV/EBITDA Equivalent valuation TV Cabo (50%) EV/EBITDA Basis US$865m 10.6x US$9.2bn Angola Telecom Angola Telecom is a Public Company which resulted from the merger of two former parastatals, ENATEL and EPTEL. EPTEL (Public Telecommunications Company) was established by Decree no 95/76, dated 23 December 1976, as result of the acquisition by the State of the Portuguese company Rádio Marconi, which operated the international traffic to and from Angola. ENATEL (National Telecommunications Company), was established by Decree no 17/80 on 13 February 1980, by separation from the previously mentioned Directorate of Post and Telecommunications, which also led to the establishment of the Angola Post Office. Angola Telecom has one subsidiary, TV Cabo, three associate companies and several minor shareholdings in related companies. Angola Telecom Multitel (30%) Elta (20%) Movicel (18%) Sat 3 Submarine Cable (3.76%) Rascom (1.14%) BCI (1%) Columbus III (0.27%) TV Cabo TVCABO is one of the pioneers in the distribution of cable television and internet services on the African continent and is a joint venture between Angola Telecom and Visabeira Group of Portugal, recognized experts in the field of telecommunications. TVCABO started laying its fibre optic network in Angola in 2002 and marketing services in 2005, and currently has a modern infrastructure network and a rapidly expanding cable television and internet user base, which competes directly with DSTV and other internet providers. Apart from an extensive presence in Luanda and Talatona, TVCabo services have now expanded to Benguela and Lobito. Revenues for 2010 increased by 32% to €22.6m, on EBITDA margins of 27%. Operating cash flows increased by 77% to €5.3m, and the customer base increased to 13,200. Movicel In 2003 Movicel was created as the mobile telephony arm of the national telecoms company, Angola Telecom. The company currently has a subscriber base of 3.3m, and in most respects seems to be lagging its larger rival, Unitel. The absence of an experienced technical partner is probably partly to blame. Nonetheless, Movicel is not resting on its laurels and the recent restructuring of the group may see them win back some market share. Movicel has targeted the lower end of the market, offering entry level mobile handsets retailing at about US$30. In a country with ARPU‟s of over US$20, this is an attractive proposal. We estimate penetration levels to be around the 63% mark and whilst we don‟t expect Movicel to take pole position from Unitel, we envisage a more equitable sharing of the mobile market in the future. Recent privatisation of Movicel On the 30 of July 2009 The Council of Ministers approved the partial privatisation of Movicel whereby 80% of the company was sold for a price of US$200m to a consortium of Angolan businesses. Post the transaction the shareholding in the group was as per figure 34. Table 13: Angola Telecom Relative Valuation and Financials Equivalent Market Cap. using peer ave EV/EBITDA (US$m) 173 Equivalent Market Cap. using peer ave PBV (US$m) 956 Sole shareholder Website Government of Angola www.angolatelecom.co.ao FINANCIAL SUMMARY 2008 2009 2010F Income Statement (US$m) Turnover 115.1 128.1 134.5 Gross Profit 113.6 126.6 133.0 EBITDA 15.3 41.4 43.4 Operating profits 0.0 25.0 26.3 Finacing income/(costs) 1.2 (2.8) (2.7) Extraordinary items 1.0 (18.6) #REF! Profit before tax 6.3 7.2 23.8 Attributable earnings 4.1 4.7 15.5 Balance Sheet (US$m) 2008 2009 2010F Fixed assets 288.9 407.4 407.4 Other assets 26.2 31.7 31.7 Debtors 308.9 347.7 365.1 Other assets 1.3 2.5 2.7 Cash 22.9 20.9 58.1 Total Assets 648.2 810.2 864.9 Shareholders' equity 355.7 355.9 371.3 Long and short term debt 194.1 284.7 298.0 Creditors 91.5 142.8 149.9 Other creditors 6.9 26.8 45.6 Total liabilities & Equity 648.2 810.2 864.9 RATIOS Net debt/shareholders' equity 48.1% 74.1% 64.6% Turnover growth 11.3% 5.0% Operating profit growth 52304.2% 5.0% Interest costs/Op profits 11.3% 10.3% Effective tax rate 35.0% 35.0% RoAE 1.3% 4.3% Figure 31: Movicel Shareholdings Structure Modus Comunicare 19% Portmil Investments 40% Angola Telecom 18% ENCTA 2% IPANG 10% LAMBDA Investments 6% Novatel 5% Source: Movicel 31
Telephonic listings of Angola (ELTA Angola) ELTA was founded in 1998 and publishes the ELTA Phonebook, as Golden Pages, fax and e-mail listings and the official tourism guide for Angola. The National Phone Book - Yellow pages and a larger business directory listing is also available. ELTA‟s mandate is to promote business by increasing transparency and facilitating communications in the business sector. Angola Telecom owns 18% of ELTA. Multitel Multitel has been present in the Angolan market since 1999. Its main activity involves the exploitation and provision of national and international telecommunication and data services. It is licensed through a concession contract awarded by Inacom to provide data communication services for public use. Multitel is a private limited company under Angolan law with capital stock of US$ 500,000. Its main partners are PT Ventures SGPS (40%), Angola Telecom (30%) and BCI – Banco de Comércio e Indústria (20%). Multitel's activity is focused on the corporate market, a sector in which it has in-depth knowledge and experience. Aware of the challenges to which companies and organizations are always subjected, and in order to respond to their increasingly more demanding requirements, Multitel positions itself as an “Operator and Integrator”, in a model that is based on the convergence of telecommunications and information technologies founded on the constant search for innovative and personalised solutions for its Clients. Table 14: Regional Comparatives for African Mobile Phone Operators Unitel Orascom Mobinil Telecom Egypt Safaricom TNM Maroc Telecom Sonatel Starcomms MTN Econet Ave Country Angola Egypt Egypt Egypt Kenya Malawi Morocco Senegal Nigeria SA Zimbabwe Addressable Population 18.3 517.0 a 83.1 83.1 40.0 14.3 65.0 b 39.0 c 156.0 552.0 d 12.5 Penetration (%) 70.3 92.0 92.0 92.0 60.0 23.0 94.8 70.0 50.0 86.0 68.0 72.8 Market Cap (US$) 1,367 3,734.3 2,377.1 4,478.8 1,794.2 93.7 16,863.0 2,896.8 24.6 38,706.8 835.4 Active Subscribers (m) 6.0 101.0 29.7 9.3 17.2 1.1 23.7 11.3 2.6 141.6 5.5 Enterprise Value/Subscriber (US$) n/a 76.7 116.5 407.7 118.4 95.3 651.9 249.2 100.3 272.4 189.4 227.8 GDP per capita (US$) 4,549.2 2,262.8 2,262.8 2,262.8 818.0 4,150.2 2,874.6 929.1 1,111.5 5,855.0 640.0 2,316.7 ARPU (US$) 20.9 3.2 5.0 15.6 5.2 5.0 12.8 9.4 7.2 10.0 7.5 8.1 Revenues (US$) 1,502 3,826 1,780 1,736 1,077 66 3,635 1,281 226 16,990 494 EBITDA (US$m) 865.0 1,584.1 1,022.7 753.3 405.7 42.4 2,137.5 668.3 48.3 7,037.8 242.7 EBITDA margin (%) 57.6 41.4 57.5 43.4 37.7 64.1 58.8 52.2 21.4 41.4 49.2 46.7 Net Income (US$m) n/a 718.6 229.7 342.7 149.3 7.1 1,095.2 329.8 (50.8) 2,118.5 140.5 PER (X) Hist n/a 5.2 10.3 13.1 12.0 13.3 13.6 8.4 (0.5) 18.3 5.9 10.0 T + 1 n/a 14.8 10.3 11.3 10.7 9.9 13.0 7.0 (1.4) 17.1 4.1 9.7 T + 2 n/a 8.9 10.2 9.9 9.3 7.5 12.4 5.6 (1.0) 16.2 3.4 8.3 PBV (X) Hist n/a 1.4 3.4 1.0 2.3 1.9 6.8 2.3 0.1 3.6 2.9 2.6 T + 1 n/a 1.3 2.1 0.9 2.0 1.6 6.7 2.1 0.1 3.0 3.4 2.3 T + 2 n/a 1.1 10.2 0.8 1.8 1.3 6.6 2.0 0.1 2.5 2.7 2.9 EV/EBITDA (x) n/a 2.4 2.3 5.9 4.4 2.2 7.9 4.3 0.5 5.5 4.3 4.0 DIV YIELD (x) Hist n/a 9.0% 8.7% 5.5% 3.2% 4.3% 7.1% 9.4% - 2.5% 2.6% 5.2% T + 1 n/a 3.2% 8.8% 6.4% 3.5% 5.8% 7.5% 11.3% - 2.7% 3.7% 5.3% T + 2 n/a 5.3% 8.9% 7.2% 4.1% 7.5% 7.9% 14.0% - 2.8% 4.5% 6.2% a Includes Egypt (80.5m), Algeria (35m), Bangladesh (156m), Namibia (2.1m), Central African Republic (4.8m), Burundi (9.9m) North Korea (22.8m) and Zimbabwe (11.7m); Excludes Canada and Lebanon. b Includes: Morocco (31.9m), Mauritania (3.2m), Burkina Faso (14.7m), Gabon (1.5m) and Mali (14m). c Includes: Senegal (13.7), Mali (13.4m), Guinea (10.1m), Guinea Bissau (1.53m). d Includes: SEA (111.1m), WECA (248.8m), MENA (192.4m), Nigeria (153.5m), RSA, 50.3m), Ghana (24.5m), Syria (21.8m) and Iran (73.2m) Source: Annual reports, Imara Securities Angola SCVM 32
Page 1 and 2: Angola Imara African Country Cement
Page 3 and 4: Angola Country Map 11a 1 9a a 8 5 2
Page 5 and 6: Executive Summary Comeback post 201
Page 7 and 8: Table 1: Timeline for major policy
Page 9 and 10: Table 3: 2011 Budget and Q1 income/
Page 11 and 12: Constraints to the growth story Ang
Page 13 and 14: US$ Millions US$ per barrel over 10
Page 15 and 16: Chevron also holds a 38.1% interest
Page 17 and 18: Italy Although Italy‟s oil intere
Page 19 and 20: SONANGOL: Angola’s de facto Sover
Page 21 and 22: Oil Majors in Angola´s Petroleum S
Page 23 and 24: In January 2011, Eni was awarded ri
Page 25 and 26: BAI BFA BESA BPC Banco BIC BESA Ban
Page 27 and 28: Table 9: Regional Banking Comparati
Page 29 and 30: Arguments for and against the devel
Page 31: Orascom Mobinil TNM Safaricom Econe
Page 35 and 36: Millions of Hectolitres NB Delta Cu
Page 37 and 38: Hotels, Tourism and Construction Ov
Page 39 and 40: • Kinaxixi Shopping Center and Of
Page 41: Capital Securities Botswana Ground

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