eircom Results Presentation

August 29, 2014

Fourth quarter and twelve months FY 13/14 Results Presentation

Herb Hribar – CEO eircom Group

Richard Moat – CFO eircom Group

© eircom

This presentation contains information and documents for information purposes only. They do not constitute or form part of, and should not be construed as an advertisement, an

offer or an invitation to subscribe to or to purchase securities of eircom Finance Limited or any of its subsidiaries, holding companies and subsidiaries of its holding companies

(together the “Group”) nor are the information or documents contained herein meant to serve as a basis for any kind of contractual or other obligation. This presentation does not

constitute a prospectus or a prospectus equivalent document.

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This presentation should not be treated as giving investment advice. No specific investment objectives, financial situation or particular needs of any recipient have been taken into

consideration in connection with the preparation of this presentation.

This presentation may include forward-looking statements within the meaning of Section 21E of the US Securities Exchange Act of 1934 and Section 27A of the US Securities Act

of 1933 regarding certain of the Group’s plans and its current goals, intentions, beliefs and expectations concerning, among other things, the Group’s future results of operation,

financial condition, liquidity, prospects, growth, strategies and the industries in which the Group operates. These forward looking statements can be identified by the fact that they

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are inherently subject to risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The Group cautions you that

forward-looking statements are not guarantees of future performance and that its actual results of operations, financial condition and liquidity and the development of the

industries in which the Group operates may differ materially from those made in or suggested by the forward-looking statements contained in the presentation. In addition, even if

the Group’s results of operations, financial condition and liquidity and the development of the industries in which the Group operates are consistent with the forward-looking

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STATEMENTS MADE herein. In addition, the Group assumes no obligation to update or to correct any inaccuracies which may become apparent in this presentation. This

presentation is incomplete without reference to, and should be viewed solely in conjunction with, the oral briefings provided to the recipient by the Group.

This presentation has not been approved by any regulatory authority. This presentation has been prepared by, and is the sole responsibility of, the Group and has not been

independently verified. All financial and operating information is based on unaudited management information unless otherwise specified.

Disclaimer

2

Agenda

Trading Q4 and FY 13/14

Key business initiatives FY15

Q&A

Business update

Economic update

3

Business highlights

© eircom

Business highlights

• Continued stability in EBITDA in the quarter

• Underlying EBITDA for FY14 of €479 million (excluding

storm costs)

• Significant capability delivered:

– Fibre rollout on track - 930,000 premises passed

– Continued momentum on fibre, 4G and TV

• Continued postpay growth driving improved mobile

profitability

• New prepay refresh launched to address churn challenges

• Group access losses of 7,000 in Q4 - Wholesale growth

continues to partially offset Retail fixed access losses

• Group broadband growth of 14,000 in Q4 driven by Retail

and Wholesale

• Cost reductions of €110 million run rate achieved (excl.

storm costs) exceeding original target of €100 million

• Satisfactory outcome with respect to ComReg action re

customer switching – LFI discussions continue

• Key strategic initiatives delivered during FY14 but

competitive challenges continue into FY15

4

© eircom © eircom

FY14 imperatives delivered and turnaround

well underway

5

Corporate Actions New Launches Financing Network Rollout

Successful completion of debt

restructuring

Mar-14

Feb-14

Aug-12 Oct-12

Announcement of Incentivised Exit Scheme: plan to

reduce workforce by 2,000 (>35%) within

two years

Launch of FMC bundles:

Combination of fixed line, broadband and

mobile

Feb-13 May-13

Sep-13

Oct-13

Dec-13

Reduction of personnel by >600 under Incentivised

Exit Scheme

Launch of fibre services for Retail

and Wholesale

Sale of Phonewatch

Launch of IPTV enabling unique quad

play

Return to capital markets with €350m

HY bond

Balance of 2,000 FTE reduction secured

through incentivised exit scheme

700k premises passed with eFibre

Moody’s credit rating upgrade, S&P/Fitch upgrade outlook to

stable

First to market with 4G services

930k premises passed with eFibre

>40% coverage Over €250m spent to date with c.60% of the

roll out complete

Jun-13

Aug-13 Amend & Extend of Senior Loan Facility • Extended maturity

• Destapling • Portable structure

Acquired 4G Spectrum

Nov-12

Cost saving target

established: €100m within

2 years(1)

Early achievement of

€100m cost saving target(1)

Apr-14

Mar-14

Feb-14

Aug-12 Oct-12 Feb-13

May-13

Sep-13

Oct-13

Dec-13

Jun-13

Aug-13

Nov-12

Apr-14

Jun-12

Jun-14

Notes

1. €100m cost saving based on Q4 FY14 annualised run rate compared to FY 2012; excludes SAC costs

2. eFibre coverage percentages shown based on 2.3m Irish premises

© eircom

Agenda

Trading Q4 and FY 13/14

Key business initiatives FY15

Q&A

Business update

Economic update

6

Business highlights

© eircom

Continued improvement in Irish Macro

7

Consumer and Business Confidence Improving

(1.1%)

2.2%

0.2%

(0.3%)

1.7%

2.5% 2.5%

(1.5%)

(0.5%)

0.5%

1.5%

2.5%

3.5%

2010 2011 2012 2013 2014E 2015E 2016E

83

38

60

(6)

Consumer

Business

Positive GDP Evolution Expected

Source: ESRI, IBEC

Source: IMF

+23 pts.

Sovereign Yields in Steady Decline

Source: Bloomberg

2.8p.p.

Real GDP Growth Rate Irish 10 Year Sovereign Yields

+44 pts.

Mar-14 Mar-13

Unemployment Is Expected to Fall 3.5 p.p. Since 2012 Peak

(%)

Source: IMF

13.9% 14.6% 14.7%

13.0%

11.2% 10.5%

10.1%

0.1

0.1

0.2

Dec-10 Dec-12 Dec-14 Dec-16

1.5

2.0

2.5

3.0

3.5

4.0

4.5

Apr-13 Jul-13 Oct-13 Jan-14 May-14 Jul-14

2.0%

• Positive GDP growth of 2.5% expected in 2014

• Irish sovereign debt upgrade by Moody’s, S&P and Fitch

• Ireland sovereign yields continue to tighten

• Consumer/business confidence increasing and unemployment continues to decline

© eircom

Agenda

Trading Q4 and FY 13/14

Key business initiatives FY15

Q&A

Business update

Economic update

8

Business highlights

© eircom

NGA passed 930,000 premises

Accelerating and extending rollout to 1,600,000…

9

Enabler of super-fast 100MB broadband and TV

services

Over €240m invested in fibre access network

930,000 premises passed at June 30, 2014

Leveraging the largest and most capable core

fibre network

Accelerating rollout to 1.4m premises passed

by Dec 2015

Extending rollout to 1.6m premises passed by

Dec 2016 (>70% of Irish households)

Plan to overlay FTTH and FTTDp to meet

customer demand

© eircom 10

• Uncongested speed of up to 100 Mbps

• 133,000 customers at June 30, 2014

• Included in bundles with unlimited off-peak calls

• Anytime calls also available

• Value proposition

• €15 add on to bundle

• Up to 100 channels

• VOD/OTT/TV Everywhere coming soon

• 4G mobile leader

• 58% coverage

• Fastest download speeds

…Investment enabling new products

and services to deliver stability and growth…

New billing platform enabling seamless triple and quad play billing and customer care

© eircom

1

3

10

21

Sep-13 Dec-13 Mar-14 Jun-14

13

32

56

75

95

3

10

18

28

38

17

42

74

103

133

Jun-13 Sep-13 Dec-13 Mar-14 Jun-14

Retail Wholesale

11

…against which eircom is starting to deliver

Growing broadband

efibre customers ‘000 Group Broadband customers ‘000

3%

% penetration of NGA

homes passed

7%

11%

13%

Successfully penetrating

e-fibre with TV

TV customers ‘000

Continued FMC growth Strong e-fibre take-up

FMC ‘000

3%

6%

14%

% penetration of

consumer NGA

customers

14%

13

21

31

41

51

61

Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14

24%

652 635 622 601 585

17 42 74 103 133

668 677696 704 718

Jun-13 Sep-13 Dec-13 Mar-14 Jun-14

Non NGA NGA

© eircom © eircom

Mobile profitability: Further EBITDA growth in Q4 FY14 while

delivering significant postpay growth

12

EBITDA

FY13 FY14

GROWTH/CHURN

• Continued postpay growth – 70k YoY

• 40% of base is now postpay customers –

from 34% YoY

• Strong growth in business mobile – subs >40% YoY

• Balancing commercial investment in postpay

against EBITDA growth

• Prepay churn remains challenging - technology

to delivered to improve prepay performance

IMPROVING CAPABILITY

• 4G services now covering 58%

of the population

• Upgrade to Dual Carrier on 3G

HSPA+ in major urban areas –

56% population1

IMPROVED COVERAGE

• Deployment of U900 to 77%

population, improving our 3G

footprint and in-building speeds

• Improving coverage on

commuter routes

NETWORK

1 Outdoor population coverage

€17m

4.9%

€36m

10.3%

© eircom

First Irish operator to launch 4G in Ireland

delivering average download speeds of 18Mb/s

• 58% population coverage at

Jun ‘14 - ahead of schedule

• On track to achieve 60%

coverage by Dec ’14

• Over 65,000 subscribers

• 70% of postpay sales are on 4G

price plans

• 4G data monetisation emerging

• Prepay 4G tariffs coming soon

13

© eircom

Prepay refresh launched

• New system delivering functionality, flexibility

and agility

• Recently launched a new range of offers in July

‘14 allowing customers to choose their preferred

package

– €10 – unlimited calls or unlimited data

– €20 – unlimited calls and data or unlimited

texts and data or unlimited calls and texts

– €30 – unlimited calls, data and texts

• Re-enforces Meteor’s value positioning in the

market in order to;

– stabilise prepay ARPU

– reduce churn

14

© eircom

Cost transformation: Over €100m run rate

savings target exceeded

2,000 FTE headcount reduction announced in Oct 2012 has been secured

• 842 FTE reduction in FY13 delivered mainly by a general voluntary leaver

program

• Targeted voluntary leaver scheme launched in Oct 2013 to deliver

remainder of 2,000 FTE target

– 1,100 exits secured of which 955 FTE left by 30 June 2014(1)

– c.130 FTE will exit by 31 December 2014

– Zero days lost to industrial action

eircom Delivered Cost Base In Line with European Average and Now Driving for Top Quartile Cost Base

Strong Track Record of Cost Savings to Date

Headcount Evolution… Over €100m savings Operating Costs (€m)

5,097

450

5,547

4,705

3,697 3,633 3,500

Q4 12 Q4 13 Q3 14 Q4 14 Q2 15E

FTE 9 day fortnight

2,000 FTE Reduction

1,914 FTE Reduction

as of Jun-14

Notes

1. FY14 exits include 45 FTE from prior year VL scheme and natural turnover of 73 FTE; implying 1,073 total headcount reduction

2. Normalised non pay costs as per FY14 outturn (excluding any projected savings in non pay in FY 15). Pay costs of €196m calculated as annualised Q4 FY14 Pay Costs (€48.3m)

288 264 220 189

351 333 324 324

639 597

543 513

FY12A FY13A FY14A Normalised Opex

Pay Costs excl. storm costs Non Pay Costs

€126m cost reduction

€40m Expected Run-Rate Opex Savings Coming Through…

230 189

324

10

324

30 553

513

FY14 Opex Storm Costs Full Year FlowThrough Benefit

From FTEReduction

Normalised Opex

Pay Costs incl. storm costs

Non Pay Costs

2

2

15

© eircom

Agenda

Trading Q4 and FY 13/14

Key business initiatives FY15

Q&A

Business update

Economic update

16

Business highlights

© eircom

Trading highlights

Q4 and 12 months to June 30, 2014

17

• Q4 EBITDA of €121m was in line with expectations and reflected

continued stability in earnings

• FY14 EBITDA of €479m (ex storm costs €10m)

• Continued pressure on Fixed Line revenues, in both Consumer and

B2B, partially offset by Wholesale growth

• Group access line losses of 17,000 in the year compared to 51,000

in FY13. Access line losses were 7,000 in Q4, down from 9,000 in

the prior year quarter.

• Group broadband base continued to grow and increased by 14,000

in the quarter and 50,000 in the year driven by both growth in retail

and wholesale

• Strong growth in mobile postpay – 12,000 net adds in Q4, 70,000

net adds YoY – but continuing weakness in prepay – overall mobile

base broadly flat in the year

• Mobile revenue is stabilising with Q4 revenue of €84m, down 3%

YoY. Full year revenue of €347m down 2%.

• FY14 Mobile EBITDA of €36m (EBITDA margin 10%), up €19m

versus last year, despite increased SAC investment to drive long

term growth

• Strong cost control – €54m saving YoY – Q4 annualised savings

€110m excluding storm costs

• Continued investment in growth programmes – €325m capex

• Maintaining strong liquidity – closing cash €199m

1 YoY comparison adjusted to exclude results from Phonewatch in Q4 & FY13

2 Non cash share incentive related provisions excluded from EBITDA (in CY and PY)

© eircom

Group EBITDA – Q4 FY14

1The EBITDA results of Phonewatch Limited, which was disposed of in May 2013, are excluded in the results for the quarter

ended 30 June 2013. For information purposes only, the Q4 FY13 results of Phonewatch were revenue of €3.5 million,

operating costs of €2.0 million and EBITDA of €1.4 million 2 Non cash share incentive related provisions now excluded from EBITDA (in CY and PY) 3 Numbers in the above tables have been presented to the nearest million and therefore totals presented above may vary

slightly from the actual arithmetic totals of such information

18

• Group EBITDA of €121m was 1% down

on prior year

• Group revenue €311m was 6% down on

the prior year quarter (compared to 9%

year on year reduction in Q4 FY13)

- Fixed revenue down 7% YoY

(compared to 11% in Q4FY13)

reflecting reduced fixed line access

volumes and traffic usage

– Mobile revenue down 3% on the

prior year with strong growth in

postpay base offset by reduction in

prepay base and lower prepay

ARPU

• Group operating costs of €129m were

€9m or 7% favourable to the prior year.

Headcount savings were partially offset

by higher customer care and other non

pay costs

• Fixed EBITDA was €6m down on prior

year while mobile EBITDA has grown by

€5m compared to the corresponding

prior year quarter

Q4 v Prior Year1 v Prior Year

FY 14 Better/(Worse) Better/(Worse)

€m €m %

Fixed Revenue 238 (17) (7%)

Mobile Revenue 84 (3) (3%)

Eliminations (11) 2 (14%)

Group Revenue 311 (18) (6%)

Cost of Sales (60) 8 11%

Gross Profit 251 (10) (4%)

% Margin 80.7%

Pay Costs before storm costs (48) 9 16%

Non Pay Costs (81) (0) (0%)

Operating Expenses (129) 9 7%

Group EBITDA 121 (1) (1%)

Fixed 108 (6) (6%)

Mobile 13 5 54%

© eircom

Group EBITDA – Full Year FY14

1The EBITDA results of Phonewatch Limited, which was disposed of in May 2013, are excluded in the results for

the nine months ended 30 June 2013. For information purposes only, the FY13 results of Phonewatch were

revenue of €26.7 million, operating costs of €15.3million and EBITDA of €11.4million 2 Non cash share incentive related provisions now excluded from EBITDA (in CY and PY) 3 Numbers in the above tables have been presented to the nearest million and therefore totals presented above

may vary slightly from the actual arithmetic totals of such information 19

• Group EBITDA of €479m (ex storm costs) was

1% lower than the prior year

• Group revenue €1,283m was 6% down on prior

year but rate of revenue erosion is slowing

(compares to 8% decline in FY13)

- Fixed revenue down 8% YoY reflecting

reduced fixed line access volumes and

traffic usage in the period

– Mobile revenue down 2% YoY reflecting

lower MTRs / ARPUs and reduction in

prepay base offset by strong growth in

postpay base

• Group operating costs of €543m were €54m or

9% lower than prior year (excluding storm

costs) reflecting strong performance on cost

transformation

• Fixed EBITDA 5% down on prior year

(excluding storms) while mobile EBITDA has

grown strongly

• Reported Group EBITDA of €469m impacted in

Q3 by €10m non-recurring network repair costs

as a result of unprecedented winter storms

Total Year v Prior Year1 v Prior Year

FY 14 Better/(Worse) Better/(Worse)

€m €m %

Fixed Revenue 980 (87) (8%)

Mobile Revenue 347 (6) (2%)

Eliminations (44) 8 (16%)

Group Revenue 1,283 (85) (6%)

Cost of Sales (260) 28 10%

Gross Profit 1,022 (56) (5%)

% Margin 79.7%

Pay Costs before storm costs (220) 45 17%

Non Pay Costs (324) 9 3%

Operating Expenses before storm costs (543) 54 9%

Group EBITDA before storm costs 479 (3) (1%)

Fixed 443 (21) (5%)

Mobile 36 18 105%

Storm Costs (10) (10) N.M

Group EBITDA 469 (13) (3%)

Fixed 433 (31) (7%)

Mobile 36 18 105%

© eircom

157 153 149138 139 145

131 129

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

278 271 268 261 259 260 252 250

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

355 353330 329 323 333

315 311

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Quarterly trading to June, 2014

20

Actual operating costs1 (€m)

1 Excludes €10 million of one-off storm costs incurred in Q3 14 and excludes non cash share incentive related provisions now classed as exceptional 2 FY 13 data presented above excludes results from Phonewatch up to the date of disposal in May 2013

Actual EBITDA (€m)

Actual revenue (€m) Actual gross margin (€m)

• The business has continued to

perform in line with

management expectations

• The rate of revenue and gross

margin decline is slowing

significantly

• Q4 EBITDA is in line with Q3

(excluding storm costs) and

broadly in line with the prior

year

• 8 consecutive quarters of

EBITDA earnings stability (note:

Q2 normally impacted by

seasonal investment in mobile

SAC)

• Operating Costs and EBITDA

adjusted for storm costs of

€10m incurred in Q3

• Q4 operating costs down €9m

or 7% on the prior year quarter

due to significant headcount

reductions YoY

(5.6%) (8.8%)

Qtr on qtr reduction compared to the PY

(4.1%) (8.8%)

121

118

120

123

121

116

111

121

10

121 118 120 123 121 116121 121

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

EBITDA including Storm Costs Storm Costs

© eircom

24%

21%

25%27% 27%

21%20%

18%18%16%

20%22% 21%

19%21%

20%

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Consumer Broadband Churn (%)Consumer Access Churn (%)

38.2 37.8 37.8 37.6 37.2 36.6 36.7 36.2

16.2 15.8 17.3 16.6 16.1 14.8 15.6 15.7

45.7 45.3 46.1 45.7 45.1 44.1 44.8 44.5

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Retail core voice & access Retail broadband

Retail blended ARPU

(16)

(23) (23)(21)

(18)(19)

(15)

2

(6)(5) (4)

4

1

4

Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Access losses Broadband growth/(losses)

979 964 940 917 896 878 859 844

459 461 455 451 447 451 452 456

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Retail Access Lines Retail Broadband Lines

Fixed line KPIs - Retail

21

Total Retail Lines (000’s) Fixed Line Churn (%)

Retail Line Movements (000’s)

ARPU1 (€)

• Rate of retail fixed line net

losses at average of 5,000 per

month in Q4 FY14 compared to

over 7,000 per month in prior

year quarter

• Retail broadband continued to

grow during Q4 (+4,000) driven

by take up of high speed

broadband and bundles

• High speed broadband services

and TV bundles are gaining

traction in the market which is

positively impacting broadband

churn

• Retail fibre connections

at 95,000 v 13,000 in

Jun 13

• FMC 61,000 v 21,000

last year

• TV base at 21,000

• Maintaining ARPU stability

despite increased promotional

activity due to the introduction

of TV bundles in Q2 FY14

1 ARPU’s has been re-stated to now include all promotional discounts which have increased in Q3 and Q4 of FY 14 as a result of the introduction of new bundles including TV

ARPU’s include core voice , access rental and broadband rental revenues (less voice and bundle discounts) and exclude connection and other ancillary revenues

© eircom

19% 21% 23%

37%

53%

65%

77% 77%

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

387 392 400 414 431 448 462 470

202 204 208 218 230 245 252 262

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Wholesale Access Lines Wholesale Broadband Lines

Fixed line KPIs - Wholesale

22

Wholesale Lines (000’s) ARPU1 (€)

Wholesale Growth (000’s)

Wholesale Pick Up Rate of Retail Access

Losses – Rolling LTM

• Strong growth in wholesale

continues to partially offset

declines in Retail

• Wholesale access lines

grew by 8,000 or 2% in the

quarter and by 56,000 or

14% compared to last year

• Wholesale Bitstream

(Broadband) grew by

10,000 in the quarter and by

44,000 (20%) YoY

• Wholesale growth has

slowed slightly in the

quarter due to a bulk

migration of bitstream lines

to lineshare in the quarter

• Wholesale growth equals

approximately 77% of Retail

losses for the full year

compared to prior year rate

of 37%

17.9 17.9 18.3 17.3 17.0 17.0 16.7 16.4

29.8 29.8 29.9 29.5 28.7 29.1 29.4 28.3

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

WLR PSTN ARPU WLR PSTN & BITSTREAM ARPU

1Wholesale ARPU has been restated to include the impact of the WLR price reduction in Large Exchange Areas (LEA) which are fibre enabled

3

5

7

14

1717

14

8

32

4

10

12

15

7

10

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Wholesale access net growth Bitstream net growth

© eircom

(10)(16)

(9)(4)

(1)(5) (7)

4

(2)

58

19

8

14

Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Group Access Losses Group Broadband Growth

979 964 940 917 896 878 859 844

387 392 400 414 431 448 462 470

1,366 1,356 1,340 1,331 1,327 1,326 1,321 1,314

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Retail Access Lines Wholesale Access Lines

Fixed line KPIs – Retail and Wholesale

23

Total Group Access Lines (000’s)

Group Access & Broadband movement

(000’s)

Group Broadband Market Share %

Total Group Broadband Base (000’s)

• Group Access line base

stabilising with reduced level

of line losses

• Group Access line losses

were 17,000 in the year

compared to 51,000 last year

• Group Broadband base

continued to grow in Q4 with

Retail BB lines up by 4,000 in

the quarter and wholesale

lines up 10,000.

• The Group Broadband base is

up 50,000 YoY compared to

growth of 7,000 in the prior

year

• eircom maintaining Retail and

Wholesale combined share of

the fixed broadband market at

~65% at Mar, 2014

eircom65%

Cable29%

Other6 %

459 461 455 451 447 451 452 456

202 204 208 218 230 245 252 262

661 665 663 668 677 696 704 718

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Retail Broadband Lines Wholesale Broadband Lines

© eircom

21 20 24 2212 12

8

4025

19 41

6

7

5

411

13

7

9

(9)

2 2

1

1

1

1

1 3

3

3

46

57

56 56

70

29

Mar 13 Jun 13 Sept 13 Dec 13 Mar '14 Jun '14

eircom Vodafone O2 3 Tesco Mobile

19.7 19.1 17.7 18.4 17.3 17.8 15.7 15.7

42.4 41.338.8 39.4 38.0

41.037.7 38.7

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Prepay Postpay

52.7 %56.8 %58.6 % 57.5%

59.0 % 57.7 %52.5 %

62.1 %

19.7%17.0% 16.1% 15.7% 16.3% 17.0%

19.9% 19.2%

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Prepay Postpay

785 770 735 702 676 675 657 629

295 316 331 357 381 403 415 427

1079 1086 1066 1,059 1057 1078 1072 1055

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Prepay Subscribers Postpay Subscribers

Mobile KPIs

24

1 Includes Mobile Broadband and M2M 2 Source comreg. Q4 data is based on actual results by operator

Total Subscribers1 (000’s) Postpay Growth2 (000’s)

Mobile Churn (%) Prepay & Postpay ARPU1 (€)

• At end Jun 14, total postpay

subscribers amounted to 427,000,

an increase of 70,000 YoY

• Postpay growth continued with net

adds of 12,000 in Q4 – achieved

33% of net adds in the market to

end March

• 40% eircom subscribers now on

postpay contracts - up from 34%

as at June ’13

• Prepay customers reduced by

28,000 during Q4 which included

post Christmas seasonal churn and

continuing pre to post migrations of

7,000 in the quarter

• Postpay churn decreased from

19.9 % to 19.2%

• Prepay churn increased to 62% in

the quarter - Prepay platform

refresh launched in July 14

expected to support reductions in

churn

• Postpay ARPU relatively stable in

last 6 quarters (increase in Q2

driven by YTD MTR adjustment)

• Q4 prepay ARPU impacted by

lower prepay top-ups % postpay

customers

27% 29% 31% 34% 36% 37% 39% 40%

© eircom

5,110

450

5,560 5,444 4,929 4,705 4,652

3,675 3,697 3,633

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

FTE 9 day fortnight

Operating cost breakdown

Operating Costs1

Headcount Evolution…

35% FTE Reduction

Notes 1 Opex includes indirect SAC but excludes cost of sales, non-cash pension charge, non-cash lease fair value credits, amortisation, depreciation, and exceptional items

FY 13 excludes operating costs in relation to Phonewatch up to the date of disposal in May 2013

FY 13 and FY 14 excludes non cash share incentive related provisions now classed as exceptional

€28 million Reduction in both pay and non pay costs

• Operating costs of €129 million are €9m lower

than same period last year

• Pay costs €10 million lower year on year

driven by substantial headcount reductions

• Non pay costs broadly flat on the prior year

• FTE of 3,633 at end of Q4 compared to 4,705

as at June 13

• Further committed VL reductions under Oct

13 scheme (126 FTE committed exits) will

deliver target of c.3,500 FTE by Dec 14

25

€86m €84m €82m €81m €77m €84m €82m €81m

€70m €70m €67m €58m €62m€61m

€48m €48m

€10m

€157m €153m €149m€138m €139m €145m €140m

€129m

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14Non Pay Costs Pay Costs excl. Storm Costs Storm Costs

© eircom

Capex breakdown by quarter to June ‘14

26

Capex % Revenue

1 Table represents incurred capex 2 Q3 incurred capex has been restated to include €3m in relation to non-cash capitalised interest costs in line with IAS 23

14.6%

56.5%

21.0%

29.7%

22.7% 22.5% 22.2%

• FY14 capex outturn of €325

million in line with

expectations given continued

infrastructure investment

• Higher Q4 spend due to;

- Timing of IT

developments and

mobile network rollout

costs

- Non-cash capex of

€10m due to

capitalisation of

interest & defined

benefit pension

scheme and ARO

obligation

34.3%

€39m €39m €44m€54m

€46m €47m €49m

€87m€14m €21m€27m

€45m

€28m €28m €21m

€19m

€144m

€53m

€204m

€71m

€99m

€73m €75m€70m

€107m

Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14

Capex NGA Spectrum

© eircom

eircom maintains strong cash balance of €199m at

June 14 despite significant investment in NGA and IE

27

€296m

€154m€28m

€104m€22m

€324m

€469m

€10m

€326m

€199m

0

50

100

150

200

250

300

350

400

450

500

550

600

650

700

750

800

30 JuneCash FY13

EBITDA Cash Capex VL Costs Paymentprovisions

Other Cash beforefinancing

Net Interest Financing 30 JuneCash FY14

Operating €2m

Financing -€126m

Note:

1 Other of €10 million includes the following movements; working capital €(3) million, restricted cash €8 million, tax €3 million and sale of PPE €3 million

2 Financing costs of €22million includes Tetra debt repayment of €9m and Amend and Extend fees of €13m

© eircom

Pension update

28

• Main Fund satisfied MFS at

30 September 2013

• No Funding Proposal required, no

cash call

Minimum Funding Standard

(Wind Up Basis)

• No deficit on triennial valuation

• Actuarial report confirms surplus of €131m

• Reduction in the company’s pension

contributions

• Accounting valuation impacted by lower

rates used to discount liabilities

• Deficit of €391m at the end of quarter 4

FY14 using prescribed discount rate for

liabilities of 2.90% based on AA- Corporate

Bond Yield.

• Deficit down from €636m at the end of

quarter 3 FY14 due to an increase in the

net value of scheme assets and a reduction

in inflation assumptions

• No Debt on the Employer, no funding

proposal, no cash call

Triennial Funding Valuation - Effective

Date 30 Sept 2013 IAS 19 Deficit

Meets minimum funding criteria No deficit on tri-ennual valuation Accounting valuation suffers from discount

rate required on liabilities

No Incremental Funding Requirement

© eircom

Phase II Cost Savings – €50m in Gross

Savings Targeted with 60% to be reinvested

29

Ongoing Cost Transformation Areas 3 Year Target

Reduction of FTE in Networks organisation through productivity programmes Networks Productivity

Improvements €6m

Further functional integration and delayering of middle management Organisation

Simplification €8m

Pay and non-pay cost reduction through outsourcing Outsourcing €5m

Consolidation of call centres, move to a single service provider, and care programmes

aimed at reducing propensity to call

Customer Care

Programme €9m

Procurement

Programme

Centralised procurement programme aimed at rationalising the number of vendors and re-

negotiating contracts across IT & Network support contracts, retail sales, marketing &

communications €14m

Operational Efficiency

Programme

Planned savings in Billing and Remittance, Transport, Utilities and Network operational

efficiencies €8m

Notes:

1. Gross savings are offset by €7m pay rate inflation and €22m in growth investment and inflation related cost increases

2. €30m from exits achieved in FY14 and 126 exits committed for FY15, €10m in one-off storm costs in FY14

€50m

On-going cost transformation amounts to €50m1 of gross cost savings over the next three years

c. 60% is to be reinvested to drive growth

This is in addition to flow through cost savings of €40m2 from FY14

© eircom

Agenda

Trading Q4 and FY 13/14

Key business initiatives FY15

Q&A

Business update

Economic update

30

Business highlights

© eircom

Key business initiatives FY15

• Continue investment to deliver best networks

• Execute bundling & convergence strategy

• Deliver superior customer experience

• Continue efficiency drive

31

Q&A

32

Thank you

33