activity report 2013

Transcription

belgacom
ACTIVITY REPORT 2013
WE ARE...
We are a telecommunications
company operating in the
Belgian and international
markets. The quality of our
interconnected fixed and
mobile networks makes us the
leading provider of telephony,
Internet and television services
in Belgium. It also allows us to
offer anywhere and anytime
access to digital data and the
best multimedia content. In
addition, we develop solutions
to reduce our CO2 emissions,
support the most vulnerable
communities and promote
access to the digital world for
all. This is how we contribute
to the economic, social and
environmental development
of the society in which we are
rooted.
>> Discover the online version
of this annual report at
http://annualreport.belgacom.com
22
Creating and
sharing value
20
Simplification
at the service
of the
customer
GLOSSARY
ISO 27001 – Security Management Standard: the basic objective of
the standard is to help establish and maintain an effective information
management system, using a continual improvement approach
3G – Mobile network of the third generation (UMTS – Universal Mobile
Telecommunications System), allowing both voice and data transmission
with higher throughput
ISO 9001 – Standard that provides a set of standardized requirements for
a quality management system
IT – Information Technology
4G – Mobile network of the fourth generation, allowing data transmission
with very higher throughput
LAN – Local Area Network
Belgacom TV ARPU – Includes only customer-related revenue and takes
into account promotional offers, divided by the number of households
with Belgacom TV
M2M – Machine-to-Machine
BIPT – Belgian Institute for Postal services and Telecommunications
Mobile active customers – Includes voice and data cards. Active
customers are customers who have made or received at least one call
or sent or received at least one SMS message in the last three months.
Prepaid customers and MVNO customers are fully segmented as CBU
customers.
Broadband ARPU – Total ADSL revenue, divided by the average number
of ADSL lines for the period considered, divided by the number of
months in that same period
Broadband lines CBU – Includes the Belgian residential lines of Scarlet
as from Q1 2009
Broadway project – Project launched end 2003, deploying a fiber
network (fiber-to-the-street cabinet) and VDSL, which today allows for
speeds up to 30 Mbps. As such this project is an important enabler for
fast Internet and Belgacom TV
CBU – The Consumer Business Unit takes care of our residential
customers
LTE – Long Term Evolution
MaIP – Move to All IP
Mobile churn rate – The total number of SIM cards disconnected from
the Proximus network (including the total number of port-outs due
to mobile number portability) during the given period, divided by the
average number of customers for that same period
Monthly net ARPU – Equal to total mobile voice and mobile data
revenues, divided by the average number of active mobile customers for
that period. The ARPU is calculated on the basis of the monthly averages
for the period indicated.
Cloud computing – The word “computing” refers to the technology
which helps to manage information better and the term “cloud” refers
to the storage of the data on the Internet. The computer systems which
once used to be installed within the company itself now operate from
outside it at external data centers. This means that companies only use
the services available on these computer systems, without having to
worry about maintaining the equipment themselves
MoU (Minutes of Use) – Duration of all calls from or to Proximus, per
active voice customer, per month
CSR – Corporate Social Responsibility
NGO – Non-governmental organization. Legally constituted, nongovernmental organizations are created by natural or legal persons with
no participation or representation of any government
CWS – Carrier and Wholesale Technologies
DSL – Digital Subscriber Line (DSL) is a family of technologies that
provides digital data transmission over the wires of a local telephone
network
Dual Carrier – a 3G feature that doubles the download speed of
compatible devices to a maximum theoretical speed of 42 Mbps by
combining data transmitted on 2 frequencies.
EBITDA – Earnings before Interest, Taxes, Depreciation, and Amortization
EBU – The Enterprise Business Unit provides services to our professional
customers
Fixed Voice ARPU – Total voice revenue, excluding activation and
payphone-related revenue, divided by the average voice access channels
for the period considered, divided by the number of months in that same
period
FSC – Forest Stewardship Council is an international NGO and a
certification system that provides internationally recognized standardsetting, trademark assurance and accreditation services to companies,
organizations, and communities interested in responsible forestry. The
FSC label provides a credible link between responsible production and
consumption of forest products, enabling consumers and businesses to
make purchasing decisions that benefit people and the environment as
well as providing ongoing business value
MTN – The MTN Group Limited is a multinational telecommunications
group, operating in 21 countries across Africa and the Middle East
MTR – Mobile Termination Rate
NFC – Near Field Communication
PUE – Power Usage Effectiveness is a metric used to determine the
energy efficiency of a data center. PUE is determined by dividing the
amount of power entering a data center by the power used to run the
computer infrastructure within it. PUE is therefore expressed as a ratio,
with overall efficiency improving as the quotient decreases toward 1
S&S – The Staff & Support Unit brings together all the horizontal functions
that support the Group’s activities
SAR – Specific Absorption Rate: unit for measuring the quantity of
electromagnetic energy that is absorbed by the human body when a
mobile phone is used. The maximum allowed SAR in Europe is 2 W/kg in
accordance with the ICNIRP guidelines
SDE&W – Service Delivery Engine & Wholesale groups together the
network and IT services and offers services to other operators and
suppliers
SIP – Session Initiation Protocol
SME – Small and Medium Enterprises
UoU (Units of Use) – Voice minutes of use + SMS (where one SMS
equals one minute) per active customer per month
USO – Universal Service Obligation
HDTV – High Definition television
VDSL & VDSL2 – Very High Rate Digital Subscriber Line is a high-speed
broadband access technology which uses the existing copper wire
infrastructure. VDSL2 is the successor of VDSL
HR – Human Resources
VOD – Video On Demand
ICT – Information and Communication Technologies
VoIP – Voice over Internet Protocol
IDTV – Interactive Digital Television
WAN – Wide Area Network
IP network – An IP network is a computer network made of devices that
support the Internet Protocol (IP)
WIFi – Local wireless network
HD – High-Definition
IPTV – Internet Protocol Television is a system through which digital
television service is delivered using the architecture and networking
methods of the Internet Protocol Suite over a packet-switched network
infrastructure
ISO 14001 – Standard that provides the requirements for an environmental
management system
CONTENT
10
Content to view,
experience and share,
everywhere and
anytime
18
26
38
14
Fit for growth
A unique
experience for
each residential
customer
MARKET
CONTENT
CONTEXT
Our networks
as the
backbone for
new services
1
A more agile
organisation
30
02Chairman Interview
04CEO Interview
06 Highlights 2013
46
Expertise
appreciated
internationally
42
A single partner
for our business
customers
08 Key figures 2013
10 Operational context
14Strategy
20Simplification
22Contribution
26Networks
30 Human Resources
34 People Focus
38Customer
48Finance
50 Belgacom share
54 Corporate Governance
BELGACOM ACTIVITY REPORT 2013
Finding a good
balance in
a saturated
market
MARKET
INTERVIEW
CONTEXT
A COLLECTIVE
RESPONSIBILITY
Belgacom is not only a driving force
of economic growth, but also of progress for Belgian society as a whole.
The company’s various stakeholders rightfully have high expectations,
which must be translated into a sustainable vision for the future and a
growth-driven corporate strategy.
For Stefaan De Clerck, Chairman of
the Board of Directors, the company’s collective responsibility and the
interests of its shareholders ultimately
go hand in hand. We talked to him
about recent changes and future
challenges.
2
You have been Chairman of the Board
of Directors since September 2013. A lot
has changed over those few months...
Belgacom is indeed going through a period of major
changes. The technological evolution in the telecoms sector is accelerating, both in the field of mobile solutions and
fixed solutions. To be able to offer our customers the highest
quality and the most innovative products, we must constantly
put the bar higher as a company. Continuous development
is an absolute necessity. This is, therefore, a priority of our
new CEO, who was appointed at the beginning of 2014.
In addition, the company has a new Board of Directors, with
a strong female representation. This renewal immediately creates a dynamic which benefits the good management of our
company. All elements are in place again to allow Belgacom
to develop a new long-term vision and set the stage for a
new successful decade. Exciting months and years lie ahead
of us, also in a European and international context. Now it’s a
question of setting out a new course.
Why is this such a crucial period?
“ALL ELEMENTS
ARE ON HAND
FOR TEN NEW,
SUCCESSFUL
YEARS.”
On a hyperdynamic and constantly innovating market, the
challenge for Belgacom is to find the right balance between
investment and cost savings. On the one hand, Belgacom
must not make any concessions to the investments required
to prepare for the future, but on the other, the competitive
environment forces us to work as efficiently as possible. That
requires a simplification of processes, products and services,
which in the end also benefits the customer experience and
customer satisfaction.
How can the different stakeholders help
achieve that successful transition?
I’m a fervent advocate of dialog. Belgacom has shown that,
together with its most important stakeholder, its personnel, it
is able to successfully marry consultation with efficiency. For
many years now, the company has experienced a remarkable
climate of industrial peace, despite the difficult market conditions. We hope that in 2014 this culture of consensus will
again prove its soundness.
STEFAAN DE CLERCK
CHAIRMAN OF THE BOARD OF DIRECTORS
The same reasoning also applies to the majority and the
minority shareholders. In the coming months the main task
will be to establish a positive climate of consultation with the
new government. But we also want to listen to the minority
shareholders. Investments in the long term must be shouldered by everyone. Our entire strategy must be established
on a solid basis that is as broad as possible. The shareholders can certainly help to show the importance of Belgacom,
not just as a lever for economic growth, but also as a company that helps society move forward, with new applications,
including in fields, such as service to citizens, healthcare and
education. This is only possible if the company remains competitive and manages to start growing sustainably again.
Is the public shareholding a guarantee
for stability?
It is extremely important that the government makes sure that the
telecom infrastructure and the related services are generally available to everyone, both citizens and companies. This is a collec-
tive responsibility. All companies, from start-ups to multinationals,
must be able to rely on the best possible infrastructure to develop
their activities. Investments in the telecom infrastructure are
therefore essential for the economy as a whole. In that respect,
the public shareholder must create a framework that makes such
investments possible and ensure that they actually take place.
What is your view of the company
today?
You must get to know the company inside out to really be
able to see how intensively people are working and the
quality that is being delivered, while the technological sector
and the regulations are rapidly changing. It is a company that
must constantly have a 360° view of its broad, quickly changing environment. Despite the crisis and various profound
changes, Belgacom manages to remain remarkably healthy
and dynamic. This is thanks to its highly competent employees, a strong focus on the consumer and major long-term
investments. Those are our assets for the future.
3
MARKET
INTERVIEW
CONTEXT
“BELGACOM
HAS SHOWN
ITS ABILITY TO
SUCCESSFULLY
MARRY
CONCERTATION
WITH
EFFICIENCY.”
MARKET
INTERVIEW
CONTEXT
BUILDING
ON OUR
STRENGTHS
TO GENERATE
SUSTAINABLE
GROWTH
4
Belgacom has all the assets to
restore growth in a constantly
changing market. Our vision is
based on a combination of highperformance connectivity, tailored
solutions, and attractive content.
We perform an essential service.
By bringing life to their screens, we
improve the lives of consumers and
businesses. This may be self-evident
today, but you still need 15,000
employees to realize this daily.
DOMINIQUE LEROY
CEO OF BELGACOM
What is Belgacom’s main challenge?
We operate in an increasingly competitive market. Although we
are seeing an increase in screens, with a real boom in sales of
smartphones and tablets, the overall number of customers isn’t
growing anymore. The challenge is therefore to increase the revenue per customer by offering innovative services. We have strong
assets to come out on top during this pivotal period.
What are these assets?
Our major investments in 3G, 4G, vectoring and the optical
local loop (“Fiber to the Home”) have given us a technological
advantage in fixed and mobile networks. We are also at the
cutting edge of technology in the field of digital television. We
have developed a vast content offer and improve it continuously.
We offer access to this content on all screens, anytime, anyplace.
Consumers and businesses want solutions that make life easier on a daily basis. They want to use their different screens for
entertainment, to share emotions and work smarter. The con
vergence of our fixed and mobile networks brings life to all these
screens. We are still far from having exploited all the possibilities
in terms of content, applications and entertainment. Security is
another area with great needs, both in the private sphere (personal data protection) and the professional sphere (IT security,
protection against cyber-attacks, etc.). Cloud computing is also a
tremendous driver of simplicity and convenience. It will become
easier to share documents, videos and photos which are securely
stored in a universal location and to view them on different
screens, including a TV. 6,000 Belgacom customers have already
tested this service.
What were the innovations in 2013 that
responded to these new needs?
We further improved the quality and speed of our networks. In the
mobile network in particular we upgraded 3G and extended 4G
coverage. 4G is like a huge motorway that you can only appreciate if you have a high-performance car. Content and applications
are the things that fully exploit ultra-fast mobile broadband. The
prospects are promising. In the field of healthcare, for example,
we have tested a 4G in-car communication system in an ambulance. We have also launched innovative applications in digital TV,
with TV Replay, and in the field of mobile payment, with Sixdots,
the future Belgian standard. Finally, the success of our all-in
offers for both residential and business customers shows that our
convergence strategy is working.
We have set up programs to guide our employees towards a
performance-based culture. The aim is to better collaborate to
ensure efficiency is at the core of all our processes. This optimal collaboration will reflect on customer satisfaction and must
become a source of pride for each of our employees.
The Chairman, in the previous pages,
talks about the “collective responsibility”
of Belgacom. What is your view of the
company’s social role?
Belgacom has indeed an important social role. This responsibility
is part our culture. Ethical values are not dictated from above but
are translated into actions in which you believe. In our case, it
seems logical to contribute to social development in fields linked
to our business, such as the fight against the digital divide, ecologically efficient solutions, and raising cyber security awareness.
Furthermore, we remain a major sponsor of cultural and sporting
events.
What does sustainable growth mean
for Belgacom?
A company that doesn’t grow has no future. Belgacom is a strong
company that wants to revive growth. To be sustainable, this
growth must strike the right balance between investment and
shareholder remuneration, without forgetting its social role.
What are your priorities for the coming
months?
We will further simplify our structures and reduce operational
costs so that we can continue to invest in meeting customer
needs. Our brand image and customer satisfaction are permanent focus areas. Through our combined efforts we can win back
market share, especially in the North of the country.
Besides, the commercialization of all our products under the
Proximus brand foreseen for the end of 2014, is an important
step towards clarity in our offering and in our communication.
It should be synonym for a better client service and of a brand
close to and listening to its users.
“PEOPLE WANT
TO USE THEIR
DIFFERENT
SCREENS FOR
ENTERTAINMENT,
TO SHARE
EMOTIONS OR TO
WORK SMARTER.
WE GIVE THEM THE
CONNECTIVITY AND
THE CONTENT THAT
BRINGS LIFE TO ALL
THESE SCREENS.”
5
What will be the new drivers of growth?
How are these priorities implemented within
the company?
MARKET
INTERVIEW
CONTEXT
In addition, we are the only national operator that can provide
integrated solutions to companies in all the different regions of
the country. We make their work easier, thanks to numerous
innovative services and smart interconnectivity adapted to their
specific needs. We have a critical mass and a strong financial
basis that other operators do not, or no longer have. But our main
asset remains the skills and motivation of our 15,000 employees.
HIGHLIGHTS
2013
SIMPLIFICATION OF
OUR NETWORKS
HIGHLIGHTS 2013
Our network simplification program has
reached cruising speed. We migrated
more than 600,000 analog lines to new
technologies, with complete transparency
for the customer.
A NEW TELEVISION
EXPERIENCE
The Belgacom teams in
charge of entertainment
services have developed a
new way of experiencing
television thanks to TV
Replay. This new service
allows viewers to replay in
delayed time any TV-program
broadcast in the past
36 hours.
6
FIRST 4G
OPERATOR
The sustained
deployment of 4G
enabled us to reach
a coverage of 50% by
the end of 2013. This
technology enables
high-speed Internet
access.
POINTS-OFSALE USING
GREEN
ENERGY
In 2013, we awarded
Eneco the power supply
contract for our Belgacom
Centers. Our points-ofsale now run entirely on
renewable energy from
wind power, produced in
Belgium.
THE MOBILE OFFENSIVE
On the residential market, we managed
to win back and retain both mobile and
convergent customers. On the SMEmarket, we consolidated our leadership
by reducing customer churn to preprice war levels. We even regained
market share!
AN INTERNATIONAL
FIRST FOR BICS
Scarlet is increasingly positioning
itself as a reference in low-cost
telecommunications, with an attractive
offer for price-sensitive consumers.
After having completely revised its
mobile offers, Scarlet launched a
triple-play offer of Internet + TV + fixed
telephony.
STRONGER TIES
WITH BNP PARIBAS
FORTIS
We won back BNP Paribas
Fortis for mobile telephony
and strengthened our ties with
the banking leader by landing
various contracts. We also
launched a joint venture together
for SixDots, the future mobile
payment standard in Belgium.
HISTORIC
CONTRACT
FOR TELINDUS
LUXEMBOURG
Telindus Luxembourg
concluded 2013 by signing
the largest contract in its
history. In partnership with
IBM and as a subcontractor
for telecommunication and
storage infrastructures, Telindus
Luxembourg became a strategic
provider of Innovative Solutions
for Finance (IS4F), formerly a
subsidiary of Dexia Group.
TANGO IS
ENTERING A
NEW ERA
Tango is entering the
entertainment era
with great strides.
It develops original
offerings (sports, games
and music) in which
entertainment is at the
heart of the matter.
FLEX, A NEW WAY
OF WORKING
We implemented a more
flexible work organization
program called Flex,
which allows us to work
in a more agile way and
more independently of our
professional environment.
Together we can make the
difference, in a spirit of trust
and accountability.
7
SCARLET,
THE LOW-COST
REFERENCE
HIGHLIGHTS 2013
BICS, our international “carrier”
subsidiary, recorded strong voice
traffic growth in a declining market.
For the first time, we established a 4G
(LTE) roaming connection between
Europe, Asia, North America and
Africa.
KEY FIGURES
2013
EUR 6.318 billion
>> Revenues
21.55 EUR
>> S hare price on 31/12/2013
EUR 1.713 billion
>> EBITDA
MARKET
KEY FIGURES
CONTEXT
2013
>>
27%
EBITDA margin
EUR 505 million
8
>> Free cash-flow
(1)
777
753
972 (1)
EVOLUTION OF OUR INVESTMENTS
(IN MILLION EUR)
734
ONSUMER
C
BUSINESS UNIT 35%
ENTERPRISE
BUSINESS UNIT 34%
SERVICE DELIVERY ENGINE
& WHOLESALE 5%
STAFF & SUPPORT 1%
BELGACOM INTERNATIONAL
CARRIER SERVICES 26%
10
11
12
13
including EUR 120 million for acquisition of 800 MHz license
15,699
>> Employees
2.18 EUR
>> G
ross dividend per share
for 2013
Subject to approval by General
Shareholder Meeting
1,677,000
5,496,000
>>
Mobile clients
MOBILE
99%
1,677,000
>>
50%
>>
11
12
4G coverage at end 2013
FIXED
13
1,479,000
>>
Belgacom TV clients
1,314,000
>>
MARKET
KEY FIGURES
CONTEXT
2013
10
3G and 2G coverage
Pack clients
± 89%
>>
VDSL2 coverage
93%
TV coverage
>>
WI-FI
± 800,000
>>
Hotspots in Belgium
-63%
>>
CO2 emissions
12,456 children
>> trained in safely using internet
and new media
9
1,637,000
1,590,000
1,558,000
>> Internet clients
MARKET
OPERATIONAL
CONTEXTCONTEXT
FINDING
A GOOD
BALANCE IN A
SATURATED
MARKET
10
Everywhere in Europe telecom
operators have had to face
a market often nearing its
saturation point. The decline
of the fixed and mobile voice
market, the Internet market
and even the digital TV market,
along with the brutal mobile
telephony price erosion, have
put margins under pressure.
The challenge for operators
will be to compensate for this
downward pressure with new
sources of revenue.
111%
>> P enetration rate of mobile
Source : Belgacom
+72%
>> S ales of tablets
Source : GFK
Navigating through an adverse economic
climate
In 2013, operators had to come to terms with a series of constraints, especially regulatory ones (see focus on p.12). The general economic climate also played a major role. Even though the
crisis is hitting Belgium less hard than other European countries,
the stagnation of economic activity is weighing heavily on both
households and businesses, which are tending to limit their
expenditure in general, and in telecoms in particular.
Rationalization for business customers
Many business customers have initiated cost-reduction programs
and have preferred to postpone investments in their IT and telecom infrastructure. In a context of rationalization, public service
companies are in search of a single point of contact, able to
provide all IT and telecom solutions they need.
Offering a low-cost alternative in the residential
market
With the crisis emerged a low-cost offer. A new player, Snow
(BASE), has entered this segment with an offer combining basic
fixed telephony, Internet and digital television, at an aggressive price. It did not take long for Belgacom to respond, via
its subsidiary Scarlet. These low-cost offers have boosted the
digital TV segment, which is slowly reaching its limit in terms of
number of subscribers.
Adapting to the explosive growth of data
traffic
Telecom operators have invested significantly in their infrastructures these past years, whether in high-speed Internet, Wi-Fi
or fourth-generation mobile networks (4G). 2013 has also seen
a proliferation of connected devices and applications taking
advantage of the ever-larger bandwidth. The intensive use of
social networks, the cloud, gaming, videoconferencing, etc. have
created new drivers for growth which are still far from running at
full capacity. New investments are required to support this data
traffic.
Monetizing the investments in the
networks
European telecom operators must take on a double challenge:
compensate for the declining revenue from voice and SMS by
developing mobile data while avoiding that a slow-down in network investment adversely affects the customer experience.
In Europe today, an imbalance can be seen between those who
have made it possible for broadband and mobile Internet to
become widespread and those who are taking advantage of this
growth. Reference is made here to what are known as “over-thetop” players which short-circuit the traditional telecom networks
by offering communication or Internet content services often free
of charge, but financed by advertising, and taking advantage of
the bandwidth.
80%
+15%
>> P enetration rate of digital TV
Source : Belgacom
>> E volution of smartphone sales
FOCUS
11
THE BELGIAN MARKET AND ITS
REGIONAL SPECIFICITIES
>> Following a purely regional logic and strategy, the penetration of the
cable operators, which is particularly extensive in Belgium, has strongly
influenced the competitive landscape. In Flanders, Belgacom’s main competitor is the cable operator Telenet, dominating the fixed market, while in
Wallonia, where Belgacom is the market leader, Voo is the main competitor. Numéricable operates in some Brussels municipalities and in a small
part of Hainaut. As the only quadruple-play operator on a national scale,
Belgacom has well understood these regional specificities. For several
years now, it has been taking these different regional needs into account in
its sales strategy.
MARKET
OPERATIONAL
CONTEXTCONTEXT
Source : GFK
Taking advantage of the momentum
in Belgium
The spectacular sales increase of smartphones (+15%) and tablets (+72%) in 2013 enables Belgium to gradually catch up with
its neigbours after a backlog of mobile Internet. 38% of mobile
telephones are now smartphones and mobile data use on smartphones more than doubled between 2012 and 2013, reaching on
average 250 MB.
The mobile experience cannot be satisfactory without fast and
powerful connections. In this regard, the 4G/LTE coverage
expanded in 2013. With a 50% coverage at the end of 2013,
Belgacom remains ahead of the 2 other mobile operators.
12
FOCUS
MARKET
OPERATIONAL
CONTEXTCONTEXT
At the same time, 3G coverage has been constantly extended.
End 2013, Belgacom was in the lead with a 3G coverage of
99.5% (source: CommSquare) and improved the 3G network
capacity, enabling speeds of up to 21 Mbps.
A REGULATORY
FRAMEWORK THAT PUTS
PRESSURE ON MARGINS
The telecom operators have had to incorporate into
their strategies 3 major regulatory measures, on a
Belgian and on a European level.
>> Prolonged effects of the “new telecom law”
The amendments to the telecom law, which entered
into force in 2012, in particular the possibility offered to
consumers and SMEs to switch operators more easily
by enabling them to terminate their contract free of
charge after 6 months, have continued to foster market
volatility. Consumer protection remains a focus for
Belgian and European political and regulatory authorities taking initiatives to increase the transparency of
offerings and prices and enable customers to better
manage their telecom costs.
>> Roaming
Roaming prices decreased again in July 2013 in compliance with the third European Regulation that entered
into force mid-2012. In 2014, this service will continue
to be under the scrutiny of the European authorities,
which aim to establish a single European electronic
communications market and intend to eliminate in the
medium term the surcharges linked to roaming.
>> Opening-up of the cable network
In 2013, the Belgian regulators adopted decisions
relating to the reference offers and wholesale prices
that cable operators must apply, allowing the effective
implementation of the obligations decided on in 2011,
between now and the second quarter of 2014.
So far, only Mobistar has expressed an interest to use
the cable platform to propose a fixed offering on the
market.
More details on the regulatory and legislative framework can be found in the financial report.
±
800,000
>> W
i-Fi hotspots in Belgium
Winning the mobile war
If just one figure for 2013 is to be remembered, one which is
indicative of the fierce competition in the mobile telephony
segment, it would undoubtedly be the drop in prices of unlimited bundles for mobile voice and SMS communication. These
dropped from EUR 80–90 per month to EUR 32–65 per month, in
just one year.
This “mobile war” is the main consequence of the “new telecom
law”, which entered into force in October 2012 and which makes
it easy to switch operators (see also the focus on p.12), along
with the simultaneous aggressive pricing by the cable operators.
This price war hits a context where penetration of mobile tele
phony is reaching its saturation (111% in Q4 2013), meaning a
very low growth potential.
The triple-play (fixed line + Internet + digital TV) and quadrupleplay (triple-play + mobile telephony) pack offers, including attractive unlimited fixed-line calling bundles, enabled to stabilize
the fixed telephony penetration rate. Belgians remain attached
to their fixed line, valuing its convenience and quality. About
7/10 Belgian households still have a fixed line.
The pace of the digital TV penetration is slowing down as these
services are adopted by a large majority of consumers. By
placing the TV product at the heart of its multiple-play offers,
Belgacom consolidated a 32% market share in digital television
and a 27% share in the overall TV market by end 2013.
Taking advantage of opportunities
“Convergent” offers to retain customers
To retain a more volatile customer base, the operators use the
technique of combined sales. As show by the growing percentage of “packs” in overall sales, the consumer has understood
the advantage of centralizing his convergence needs - fixed and
mobile, voice and data, communications and content - with just
25%
>> 2 5% of customers with Pack have also
included mobile Source : Belgacom
38%
>> 38% of mobile owners have a smartphone
Source : Belgacom market research, second semester of 2013
INTERNET
BELGACOM 44%
CABLE 50%
OTHERS 6%
TELEVISION
BELGACOM 32%
CABLE 64%
OTHERS 4%
MOBILE
BELGACOM 41%
MOBISTAR 29%
BASE 24%
CABLE 6%
one provider. As early as in 2007, Belgacom has been a pioneer
and leader in this convergence strategy, first by selling packs and
then by launching convergent services, such as TV Everywhere.
Differentiating services in the cloud
Cloud computing, i.e. the remote access to IT applications and
services by means of just a web browser and a broadband connection, offers enormous potential to the telecom operators.
From mass-market storage of family photos to the provision
of solutions combining connectivity and IT aimed at SMEs to
the management of ultra-high performance data centers, every
customer will find way to satisfy his or her needs. The cloud is a
unique opportunity for the operators to differentiate themselves
by offering new, flexible and secure services.
13
Stabilizing the fixed telephony market
BELGACOM COMPETITIVE POSITION
(MARKET SHARE)
MARKET
OPERATIONAL
CONTEXTCONTEXT
This shake-up of the mobile market generated a decline in the
prepaid card market, due to the greater attractiveness of the
postpaid offers, and an increase in customer volatility. The latter,
however, has slowed down since the third quarter of 2013.
MARKET
STRATEGY
CONTEXT
FIT FOR
GROWTH
14
>> In a hyper-connected world the customer
should be able to interact via the terminal of his
choice, wherever, whenever and however he
wants, regardless the level of complexity of the
underlying technology.
Building on our assets
Belgacom has undeniable assets on which it can rely: its fixed
and mobile networks, its lead in cloud computing and digital TV,
its distribution network close to the customer, and above all its
employees, whose expertise and capacity to adapt, enable the
company to cope with difficult market conditions.
The best convergent networks
Belgacom is counting more than ever on its convergence strategy
to ensure sustainable growth in a complex market. In 2013, this
extensive convergence of networks, content and applications
led to a range of services increasingly adapted to the needs of
hyper-connected customers and available on many complementary screens.
CONVERGENCE AT BELGACOM
Talented employees
PACKS
DISCOUNTS
ANYWHERE
SERVICE AVAILABLE FROM ANY NETWORK, MORE AND
MORE SEAMLESSLY, ON ANY CONNECTED DEVICE
Belgacom can rely on the motivation and contribution of its
15,000 employees. We are an employer of choice which promotes innovation and mobility and aims to develop talent in the
fields of the future.
Our own cloud and cyber security expertise
ANYTIME
ACCESS IN A NON LINAR WAY
TO ANY CONTENT
USER CENTRIC
INDIVIDUAL USER PROFILE
AND PREFERENCE
SERVICING
ONE CONTACT - ONE DATABASE - ONE SYSTEM & PROCESS
Our cloud platform, managed from our own data centers, guarantees an optimal level of security for our customers. Moreover,
Belgacom is developing its competence in cyber security in order
to meet current needs. In this field, it has become a reference for
many companies.
An advanced digital television platform
Belgacom is a pioneer in digital TV services. It is the only
company in Belgium that allows customers to watch TV on any
device, on the fixed or mobile network, thanks to the service
TV Everywhere. It is also the first operator to offer TV Replay,
which allows you to watch a program up to 36 hours after it has
been broadcast.
A distribution network close to the customer
BELGACOM HAS ALWAYS BEEN A CONVERGENCE PIONEER
AND INTENDS TO REMAIN LEADER OF CONVERGENT SERVICES,
NOT JUST BY DEVELOPING PACKS BUT BY ALLOWING USERS TO
ACCESS THEIR CONTENT, APPLICATIONS AND SERVICES ANY TIME,
ANY PLACE, IN A PERSONALIZED WAY.
Residential and business customers have easy access to Belgacom’s competent staff, who are at their disposal in an extensive
sales network composed of Belgacom Centers, indirect sales
partners, call centers, and customer advisers (for key accounts).
15
>> THE 29 EXPERIENCE STORES LET THE
CUSTOMERS BETTER UNDERSTAND OUR
PRODUCTS.
MARKET
STRATEGY
CONTEXT
Our main challenge is to restore
sustainable growth by winning back
market share (as we did with our mobile
subscriptions at the end of 2013) and by
emphazing even more the convergent
solutions for our customers. To achieve
this, we must continue to invest in our
networks and platforms to respond
to the needs of the future. At the
same time, we are speeding up our
transformation to become a more agile,
differentiated company.
Customer satisfaction is based on the customer’s overall experience with our brands. Our rich convergent products and services
must simplify their lives and give them the freedom to interact
with the device of their choice, wherever, whenever and however
they want, regardless of the level of complexity of the underlying
technology.
>> AS WE HAVE DONE WITH DIGITAL TV
AND THE 3G AND 4G NETWORKS, WE HAVE
TO ANTICIPATE TECHNOLOGICAL
MIGRATIONS.
We aim to invest more in our networks, systems and services
by, first and foremost, making our fixed and mobile networks
increasingly intelligent and flexible. The networks, which are
compatible thanks to IP technology, will be able to recognize
the user and adapt his or her access to services based on his or
her profile. As such, our systems enable us to personalize our
offer even more, and to develop new convergent services more
quickly and easily. We then need to transform Belgacom in such
a way that our customers can easily contact us via digital and
interactive communication means.
Belgacom hopes to simplify and optimize its work processes in
order to limit the need to replace these resources. It will involve
the redeployment of competencies and expertise in order to
adapt to the future company needs. This transformation will allow
us to keep our HR costs at a consistent level for at least the next
5 years.
BELGACOM FOCUSES ON 4 LEVERS TO BECOME
MORE AGILE AND RESTORE SUSTAINABLE GROWTH
The saturation of our traditional markets forces us to adapt and
focus more on reducing our operating costs. To increase profitability, it is no longer enough to invest. We also need to work
on our cost structure. These savings are essential, if we want to
increase our investment in our networks and solutions, restore
long-term growth, and provide our shareholders with a sustainable remuneration.
Belgacom focuses on 4 levers
to become more agile and restore
sustainable growth
Enhancing the customer experience
In a sector with ongoing technological changes, Belgacom
invests in services which provide real added value to consumers
and businesses through strong and differentiated brands (Proximus and Scarlet). Not only is it essential to invest in innovations
generating growth, but also to deploy them at the right time,
among the right customers, and to communicate as effectively
as possible. That is how you win or win back “profitable” market
share. In this respect, the cloud is a major growth driver among
both residential and business customers. For the latter, we want
to become the single privileged contact for all their telecom and
IT needs, with increased focus on security.
GROW
A deep transformation
to anticipate the future
TRANSFORM
16
Belgacom is the only operator in Belgium to offer all its telecom
and IT services over its own networks. In the mobile sector,
we increased our investment in the 3G experience and the 4G
deployment. With regard to the broadband network, we continue
to develop advanced technologies to better anticipate growing
Internet traffic needs and improve VDSL2.
Belgacom is a flagship company of the BEL 20, employing more
than 15,000 people directly and over 11,000 indirectly. In the
following years, Belgacom has to prepare for the retirement of
several thousand employees.
SUSTAINABLE
GROWTH
CUSTOMER
EXPERIENCE
EFFICIENT
ORGANIZATION
GOOD
TO GOLD
CULTURE
SIMPLIFICATION
INVEST
MARKET
STRATEGY
CONTEXT
Consolidating our leadership
Making our organization more efficient
STRONG
BRANDS
CONVERGENT SERVICES
CONVERGENT NETWORKS AND IT
Simplifying at all levels
MARKET
STRATEGY
CONTEXT
Simplification also helps us reduce costs and improve the customer experience. Indeed, a simpler offer and simpler systems
are less expensive to manage and guarantee the customer a
better quality experience.
Standing out from the competition with differentiated
brands
With the convergence of fixed and mobile technologies, but also
telecoms and IT, our customers are looking for a single partner,
able to provide all these services. In this context, the merger of
our 2 commercial brands, Belgacom and Proximus, into a single
brand is a natural development, more in line with the reality of our
offers and simpler for our customers. It also facilitates the management of our internal systems and our product offering.
17
Proximus, the banner of a single brand
At the end of 2014, the Proximus brand will group our mobile
technologies and solutions with our long-standing expertise in
fixed telephony, ICT, Internet and digital television. With Proximus, we opt for a brand that embodies proximity – of customers
to their world, and of our company to its stakeholders.
Apart from Proximus, Scarlet continues to target more price-
conscious customers.
One brand: Proximus. One company: Belgacom
Over the years, Belgacom has become a leading telecom player.
Therefore, it should keep its name and status as a legal entity, as
an employer, and as a listed company, not just for our employees
but also for our partners, suppliers, shareholders and other
stakeholders.
Building the future culture:
“From Good to Gold”
In order to mobilize all its forces behind common objectives,
Belgacom focuses on different levers for evolving towards a
company culture that rhymes with better service quality and better results. For example, as of 2014, all management members,
regardless of their department, will have the same objective at
Group level. The stronger collaboration between departments will
improve and speed up decision-making. The aim is to develop
a “From Good to Gold” culture which stimulates performance,
respect, feedback and transparent communication.
Always more
simplicity
>> Simplification enables us to reduce costs and improve
the customer experience
Simplification is a strategic priority at all levels. First of all, Belgacom intends to significantly streamline its portfolio of products
and solutions. Furthermore, the migration of a number of ageing
systems to new IP technologies allowed us, particularly in 2013,
to prepare the network simplification. Our internal IT systems are
also the object of rationalization and efficiency programs.
CONTENT
TO VIEW,
EXPERIENCE
AND SHARE,
EVERYWHERE
AND ANYTIME
Content creates added value
For almost 10 years now, Belgacom has been investing not only
in technology, but also in its content offer. Its goal is to permanently redefine the television consumer experience. As pioneer
in Belgium and Europe, Belgacom has understood that digital TV
is a natural extension of the telecom operator profession and a
source of added value for its customers. In the beginning, added
value was linked to digital television’s intrinsic qualities: image
quality, access to an ever-growing range of programs, “on-demand” consumption, ease of recording, etc. Over the years,
hundreds of thousands of Belgians have integrated digital television and a Belgacom decoder into their living rooms. This new
way of watching television has now become an established part
of their lives.
MARKET
STRATEGY
CONTEXT
Convergence with 4 dimensions
18
In 2013, Belgacom again
reinforced its content strategy
by being a distributor, producer
and co-producer all at once. Its
program offering was further
enhanced by new features
which provide more freedom
and convenience. Consumers
now have access to lots of
entertainment, no matter what
their tastes are, what time of
the day it is, where they are or
what type of terminal they are
using.
In pace with technological innovation, content consumption is
becoming ever more intuitive and personalized. It has given material
shape to the convergence strategy valued by Belgacom: subscribers
can now watch what they want (for all tastes, from the most general
to the most local), where they want (on a computer, TV, tablet or
smartphone) and when they want (live or delayed broadcasting).
A fourth dimension which is of particular importance should be
added: “on the platform of their choice”. Indeed, whereas some
10,000
>> More than 10,000 titles available
in video on demand
>>
70
Over 70 channels in our basic
Belgacom TV offer
Our exclusives on
Belgacom TV
>> Belgacom TV offers packs adapted to kids or fans of evergreen
movies, and exclusive football and basketball content on Belgacom 11,
11+ and 5
content providers focus on closed systems, Belgacom offers the
same quality of access on a maximum number of multi-brand
terminals and pursues a multi-platform strategy open to all operating
systems.
A customer retention argument
In 2013, Belgacom launched TV Replay in a test phase with
10,000 customers. This service makes it possible to watch
any TV program up to 36 hours after broadcast, on any type
of screen, from a television to a smartphone. This new service,
exclusive to Belgium, and developed in close collaboration with
the main Belgian broadcasters, meets the growing need of consumers to watch their favorite content whenever they want.
>> Launched in 2013, this service makes
it possible to watch a program up to
36 hours after broadcast, on any type
of screen
And further, the multi-screen use via the TV Everywhere offer has
become more popular these past months. Belgacom offers a wider
choice, with 40 or so channels available at one’s fingertips, on a
smartphone or tablet. It is striking to note that the audience peaks
registered on TV Everywhere occurred most frequently during live
broadcasts, in particular during football matches.
19
An expanded offer for all tastes
Privileged partnerships
Our range of channels and channel packages has again been
extended, with special attention being paid to local content. For
example, we offer feature channel, Dobbit TV (devoted to DIY)
and, on an exclusive basis, the Fashion One channel (dedicated
to fashion and trends). In July, we launched the Multi-Channel
Package, grouping the existing channel packages Kids, Entertainment, Nature & Discovery, Nostalgia, and Sport & Pleasure,
together with more than 40 thematic channels in a single package. To ensure customers can easily find their bearings in our
abundant range of channels and videos on demand, we further
improved our personalized search and recommendation tools, to
meet the most exacting requirements.
Being a content distributor and (co)producer all at once opens
many doors and makes it possible to provide TV viewers and
mobile Internet users a differentiated offer. Sponsoring enables us
to be present at major national and local sports, music and cultural events, to share the highlights with the public and to obtain
content which we subsequently distribute on different platforms.
Talking sports, Belgacom highlights its privileged partnerships
with Belgian basketball, football and cycling. We are also present
at major music festivals of which we offer streaming broadcasts
to our customers, the Ghent Film Festival, Bozar and the Queen
Elisabeth musical competition. Finally, being the co-producer of
more than 20 Belgian or Belgian-French films per year, enables us
to be associated with several major movie pre-premières. We also
organized, for the first time ever in Belgium, a pre-première video
screening at the home of a Belgacom TV customer, in the presence of the film’s actors (Brasserie Romantiek in Mechelen and
Stars 80 in Huy).
Football news
Our football channel Belgacom 11+ covers the British League
Cup. The UEFA Champions League (with its famous multi-live
feature) and the best of the Spanish and Portuguese championships continue to be our established values. Our differentiated
football offer includes programs dedicated to behind-the-scenes
coverage of Belgian clubs, such as RSCA TV, Club TV, and Charleroi TV and of big international clubs via our exclusive partnerships with Barça TV, Real Madrid TV, Manchester United TV and
Manchester City TV. In 2013, we also broadcasted exclusive
content linked to our Red Devils, partners for already 20 years:
the documentary Everyday Football about the everyday life of our
national team and of all Belgian football protagonists, including
coverage of youth team matches.
Continuous investment
In the months and years to come, Belgacom will continue to
invest in enhancing its content offering, both in local programs
and international blockbusters. Most of these programs can be
watched on demand, live or in delayed broadcasting and on
a maximum number of platforms. This unique and convergent
television experience is linked to our telecom operator profession.
The added value of our increasingly intelligent networks becomes
tangible for all our customers.
At any time and on any type of screen
TV Replay
MARKET
STRATEGY
CONTEXT
Our content offer is strategic. It makes our technical expertise
directly tangible to the customer. It is also crucial: on a volatile
market, anytime access to extensive and varied content has
become an important customer retention tool. Customers who
have a unique experience, by watching a football match on
their smartphone or by taking advantage of the possibilities of
“smart TV” with their family, will recognize our added value. As
a result, they will not want to look elsewhere. On the contrary,
they will be tempted to use more programs, which increases our
average revenue per customer. This content strategy allows us to
establish a strong emotional link with them.
SIMPLIFICATION
SIMPLIFICATION
AT THE SERVICE
OF THE
CUSTOMER
20
In 2013 Belgacom committed itself to
an ambitious simplification project.
This project is one of the pillars required
for the transformation of the company.
Simplification aims to improve the
customer experience while generating
increased agility and efficiency. These
3 objectives help to reduce operational
costs and will result in structural changes
that will increase Belgacom’s profitability
in the medium- and long-term. The
simplification project covers 4 key areas.
A simplified, future-oriented products
and services portfolio
600,000
>> Belgacom migrated more than 600,000 lines
based on analog technologies to new standards
Our customers expect ever simpler offers. That is why Belgacom
pays special attention to simplifying its commercial offers by reducing the number of options for mobile subscribers and by offering
convergent “all-in packs” which meet the needs of most of its customers.
For example, the number of customers subscribing to the comprehensive Internet Everywhere/Bizz Pack offer continues to grow. More
previously scattered services are now grouped in one bundle, which
facilitates billing and administrative follow-up, both for the customer
and Belgacom.
In 2013, Belgacom carried out migrations from old to future-oriented
solutions. Belgacom committed itself to further simplify the structure
of its products and services portfolio in order to reduce maintenance
costs and further improve the customer experience.
A simplified network
Simultaneously managing different generation networks is a challenge and a major cost. In 2013, Belgacom made substantial progress in simplifying its network infrastructure. This project, called
Mantra, has made it possible to migrate more than 600,000 oldgeneration fixed lines to new standards. As for the backbone network, ATM lines have been replaced by solutions and technologies
of the future. Belgacom will continue to dispose of old technologies
and further increase the value-added services for its customers.
>> THE OPTIMIZATION OF OUR IT SYSTEMS
PROVIDES A BETTER CUSTOMER EXPERIENCE.
A simplified architecture
for the IT systems
Proactive replacement of 80,000 digital television decoders with more scalable models
makes customers benefit from a better
customer experience: TV in HD (high definition), more recording options and an interface
allowing faster and easier navigation through
the menus.
A rationalized number of providers
Belgacom was able to reduce the number of its providers and partners for certain market segments. Reducing the number of providers
has made it possible to simplify and streamline the procurement
procedure, from tendering to bill management, logistics and delivery, which also results in significant savings. Finally, fewer but more
strategic partnerships allow us to maintain privileged relationships
with our partners. This effort will be continued in 2014.
21
Simplification also means nurturing a
state of mind and culture
360,000
By making simplification a top priority, Belgacom has started a
process of deep change in its corporate culture. This transformation process is supported and supervised at the highest level of the
company. Having maximum number of employees adhering to this
transformation is one of the key success factors of this project.
>> In 2013, Belgacom migrated
360,000 customers to Internet Everywhere
and Bizz Pack convergent offers
MORE CLIENT
ORIENTED
>> More understandable
>> Friendlier
>> Intuitive interaction
FASTER
+
>> Shorter time to market
>> Real time activation
>> Faster problem solving
MORE EFFICIENT
+
>> Optimization of IT and
network costs
>> More efficient processes
=
BETTER
FINANCIAL
RESULTS
AN IMPROVED
CUSTOMER EXPERIENCE
SIMPLIFICATION
FOCUS
We also launched a major project to optimize our IT systems. It aims,
among other things, to speed up the process of bringing new products to market, while simplifying the management of the catalog
of existing products and services. In 2013, new software solutions
were implemented enabling different departments to work faster and
more efficiently in all stages of interaction with our customers, from
the search for information about our solutions to the payment of bills
or the management of customer needs.
22
Belgacom has been a well-known
Belgian company for generations.
Its importance for the economy and
Belgian society as a whole continues to
grow, with the increasing importance
of new technologies in our lives and
companies. As a leader and innovator,
Belgacom takes its responsibility
to society. We are convinced that
our company’s success depends
on our capacity to make a positive
contribution to economic, social and
environmental progress. We want to
create value, and above all, to share
that value through our infrastructure,
solutions, and our employees.
A MAJOR ECONOMIC PLAYER
Despite a complex market situation, we invested in 2013
EUR 972 million mainly in more performing networks. At the same
time, prices of our solutions continue to drop, as such, providing
access to communications to a vast majority. We are also one of
the top employers in the country, with almost 15,000 employees.
We believe our employees are our best asset. Every year, we
invest in their development and training. In 2013, each employee
followed an average of 23 hours of training!
Direct contribution
In 2013, we paid EUR 1.67 billion in taxes, social contributions
and dividends.
RESPONSIBILITY AT THE HEART OF
OUR ACTIVITIES
We acknowledge the need for responsible and transparent management of our activities towards all our stakeholders. Corporate
Social Responsibility (CSR) is a strategic management tool and a
key element of our corporate mission and strategy.
Our CSR strategy aims to contribute towards a safer, greener,
more inclusive (digital) society, while ensuring we do business in
an ethical and responsible way.
OUR CSR STRATEGY
>> SMARTCAFÉS ARE ORGANIZED IN
14 POINTS-OF-SALE AND PROPOSE
13 TRAININGS ON OUR PRODUCTS AND
SERVICES.
COMMITMENTS STRATEGY CHALLENGES
CONTRIBUTION
CREATING
AND SHARING
VALUE
Online
safety
Digital
divide
Climate
change
Ageing
population
Enable a more inclusive, safer and greener (e)-society
1
Enhancing access
to communications
2
Encouraging
a responsible
product use
3
Enabling a
low-carbon society
4 Ethical and responsible operations
(employees, suppliers, communities)
6,000
23
4,000
2,000
0
Enhancing access to communications
Our significant investments in Belgium’s digital infrastructure
improve access to technologies and essential services, enabling
people and businesses to interact while generating economic
benefits.
We make a special point of improving the digital literacy of
citizens and helping more people connect to the Internet to
enjoy the benefits of the digital society. In September 2013, we
launched SmartCafé, a series of 13 training sessions on our
products and services. These sessions, open to everyone, were
given in 14 of our points-of-sale, and we count already more than
500 participants.
>> www.belgacom.be/formation
Web Experts for sharing across generations
We carried on the Web Experts initiative, which encourages
young people to share their knowledge of the Internet with
older people. We also continued to support various ICT training
centers. In total, we helped more than 11,300 disadvantaged
citizens improve their digital skills.
>> www.webexperts.be
10
11
12
13
Devices for people with a disability
We continued to expand our catalog of devices and applications for people with a disability. In our general catalog of mobile
phones and tablets, we also created a filter which allows you to
easily identify devices for people with special needs.
>> www.belgacom.be/handicap
>> h
ttp://bit.ly/devicecatalog
Encouraging a responsible product use
Since telecoms play an increasingly important role in our lives, we
promote the safe and responsible use of our solutions. We focus
on providing information on electromagnetic fields, and health.
We are also involved in the protection of children online. This
policy favours our brand image and makes Belgacom a reference
partner. It allows us to develop a relationship of trust with our
stakeholders.
7,424
8,000
11,329
9,699
10,000
10,109
12,000
CONTRIBUTION
NUMBER OF DISADVANTAGED
PEOPLE TRAINED ON ICT
SKILLS BY BELGACOM
Cooperation with Child Focus
In 2013, our employees trained over 12,000 children in 185
primary schools on the safe use of Internet, in cooperation with
Child Focus (the Belgian Safe Internet Center) and Microsoft.
Exposure to electromagnetic fields
As for the mobile network, we continuously extend it in a socially
responsible way, in accordance with the strict regional standards
on electromagnetic fields.
Enabling a low-carbon society
We are determined to speed up the evolution towards a low-carbon society. Our goal is to reduce our CO2 emissions by 70%
by 2020 (compared with 2007). At the same time, we help our
customers reduce their own environmental impact.
Waste recycling
As much as 83% of our waste is recycled, and most nonrecyclable materials is used to generate energy. In cooperation
with the NGO GoodPlanet Belgium, we initiated a large-scale
awareness campaign on mobile phone recycling in schools.
Mobile phones contain precious metals and materials which can
be given a second life.
ICT solutions good for the environment
Finally, our ICT solutions, for example videoconference or
the cloud help our customers save energy and reduce their
CO2 emissions.
EVOLUTION OF
OUR CO2 EMISSIONS
07
-70% TARGET
24
Belgacom’s energy consumption fell by more than 3% for the
third consecutive year. We also managed to reduce our ecological footprint by an additional 2%. Our transparency in this regard
and our performance in the fight against climate change have
earned us two CDP awards (CDP is an international, notfor-profit organization providing the only global system to measure, disclose, manage and share vital environmental information). We are now among the 5 European telecom operators with
the best results in this area.
-63%
CONTRIBUTION
Energy consumption reduced by 3%
13
20
-63%
>> Since 2007, we have reduced
our CO2 emissions by 63%
Ethic in our way o working
We want to carry out our activities in a responsible and ethical
way in relation to our employees, our suppliers, and the communities in which we operate. This helps us to build trust with our
stakeholders, protect our image, improve employee engagement,
contribute to social integration, and create stronger ties with our
suppliers and communities.
Our Corporate Governance Charter, Code of Conduct, Compliance Office, and policies underpin our approach to responsible
business.
The main pillars of our ethics charter:
Positive work culture
We believe in the professional development of our employees.
We fight against all forms of discrimination and promote a worklife balance in the workplace. To this end, in 2013 we launched
the first 2 phases of a project offering our employees the possibility to work from home 2 days a week. Our promotion of a pleasant work environment has earned us the “Top Employer” title for
several years (read our chapter on “A more agile organisation”).
We apply increasingly strict ethical standards for our supply
chain, in close collaboration with our suppliers. By incorporating
CSR standards in our buying procedures, we not only improve
our brand image but also produce beneficial changes in the communities where our suppliers operate.
Our suppliers must meet well-defined social, ethical, security and
environmental standards. We regularly monitor compliance with
these standards through surveys and dialog with our suppliers.
12,456
>> 12,456 children have been trained
in safely using the Internet and
new media
CSR is an integral part of our supplier’s performance reports, of
the contracts and the tendering criteria. We also distributed a
“Sustainability Award” to a local supplier.
>> www.belgacom.com/suppliers
Supporting communities
Belgacom’s contribution to society is also felt in a very concrete
way in the field.
In 2013, we invested over EUR 1.8 million in social action,
whether through financial donations, the provision of services or
volunteer initiatives by our employees.
For example, we continued to provide free broadband connectivity to Bednet and Take Off to enable children with a long-term
illness to stay in contact with their class at school.
More information on
>> www.belgacom.com/responsibility
>> Please send your comments on our CSR commitment
and your opinion of this report to [email protected]
CONTRIBUTION
In 2013, 140 suppliers filled in our CSR self-assessment questionnaire, and the 59 suppliers belonging to the “medium to high
risk” category have been invited to set up a corrective action
plan. 38 on-site audits were carried out and shared by the “Joint
Audit Cooperation” (JAC) members. Belgacom itself carried out
4 of these on-site audits.
In the beginning of 2013, we offered 2,500 nights to homeless
people in one of our buildings. We also raised over EUR 70,000 in
funds through our SMS services.
Our sales divisions invite customers to convert the points earned
through our loyalty plan, into donations for Unicef and the
Foundation Against Cancer. We were able to donate more than
EUR 80,000 to these associations in 2013.
Over the past few years, our efforts to more concretely shape
our social responsibility have been recognized by independent
parties, as our integration in CSR indices, such as the Ethibel
Sustainability Index, ASPI, CDP and the Triodos Sustainable
Investment Universe, clearly illustrates.
25
Responsible supply chain
MARKET
CONTEXT
NETWORKS
OUR
NETWORKS
AS THE
BACKBONE
FOR NEW
SERVICES
26
One of Belgacom’s most important
assets is its networks. In 2013,
we continuously worked on the
technological development of both
our fixed and our mobile networks
and made serious progress in
simplifying them. We also paid
special attention to delivering an
even higher quality service and
developing new services.
82%
>> Customer satisfaction with
installations
± 89%
>> VDSL2 coverage
A fast high quality mobile network
In 2013 Belgacom again invested substantial amounts in the
quality of its network.
For example, the average speed on the 3G network was
increased by 60% and customers can now enjoy an average
download speed of 6.2 Mbps, with peak speeds of up to
21 Mbps. In addition, we increased the capacity of the 3G
network by 70% to support the particularly strong growth in
mobile data use.
In an independent study of Test Achats conducted in the first
half of 2013, we were acknowledged as having the best quality
mobile network in Belgium.
LOOK THROUGH THE EYES OF THE
CUSTOMER
>> ENHANCING THE CUSTOMER’S
SATISFACTION IS OUR PRIORITY.
First Belgian operator with 4G coverage of 50%
End-2013, Belgacom’s brand-new 4G network reached 50% of
Belgium’s population.
Commitment to further extend 4G coverage
In order to enable as many customers as possible to acces
ultra-fast mobile Internet with 4G technology, Belgacom
continues to invest in mobile coverage.
To that end, we purchased, for EUR 120 million, one of the
3 licenses auctioned by the BIPT, the telecom regulator, for use of
the 800 MHz spectrum. The license is valid for 20-years and will
provide better, homogenous coverage in more rural areas.
A powerful and ever-faster fixed network
In 2013, Belgacom continued to extend its VDSL2 network,
which now reaches +/- 89% of the Belgian population.
FOCUS
Thanks to the VDSL2 technology, a large majority of our customers can enjoy a more powerful Internet connection with an average speed of 33 Mbps along with high-definition television.
OUR COMMITMENT TOWARDS
CYBER SECURITY
>> The security of our systems and data is an absolute
priority for Belgacom. As market leader we have to set the
example and play a pioneering role to guarantee data confidentiality and privacy protection at all times.
>> In 2013, Belgacom was the victim of a hacking attack on
its internal systems. This incident inevitably received much
press attention, but Belgacom completely openly communicated.
>> Cyber security requires constant vigilance and continuous investment to constantly optimize the security
systems. A few months after this incident, Belgacom has
learnt a great deal from the way in which this problem was
detected and solved. This knowledge is now being shared
with customers and authorities.
>> This incident reinforced Belgacom’s commitment
towards strong cyber security in all its aspects. The new
cyber defense plan provides for a wide range of actions
across different domains: setup of a series of structural
measures and governance, increase of continuous awareness of our employees about the importance of cyber
security, optimal protection of networks and IT platforms,
and the establishment of a Cyber Defense Unit. This Unit
focuses exclusively on detecting and solving cyber incidents.
In addition, the VDSL2 network is perfectly suited for new applications, such as the storage of documents, photos and videos in
the cloud and personalized TV solutions such as TV Replay.
Speed boost with Dynamic Line Management
In 2013, Belgacom switched its VDSL2 network into a higher gear
with the help of Dynamic Line Management, an in-house developed technology.
This technology continuously monitors a line’s stability and
adapts it in a dynamic way to the highest technically attainable
speed for that specific line. In this way, the average speed of all
VDSL2 lines was increased by 30%, while one-third of all VDSL2
lines now reaches speeds of up to 50 Mbps.
Vectoring for an even better performing network
Belgacom is a pioneer in vectoring, a crosstalk suppression technology which significantly improves the performance of a VDSL2
line. Belgacom closely collaborates with Alcatel-Lucent and other
leading industrial partners on the development of this technology.
In 2013, Belgacom became the world’s first operator to test vectoring in real-life conditions with around 1,000 users on its VDSL2
network. End December, Belgacom managed to successfully
complete the development stage and activate the vectoring technology for customers who have our brand-new modem which
supports these vectoring speeds.
Since the beginning of 2014, Belgacom has started the rollout
of vectoring on its network to let a majority of customers benefit
from guaranteed speeds of 70 Mbps.
27
Moreover, a solution was developed to roll out 4G in the
19 municipalities of the Brussels Capital Region. At the start of
2014, Belgacom was the first operator to launch 4G in Brussels
on a first number of sites.
MARKET
CONTEXT
NETWORKS
The new 4G technology enables ultra-fast Internet with an average download speed of 19 Mbps, with peak speeds reaching
56 Mbps.
Internet everywhere thanks to a powerful Wi-Fi
network
Belgacom steadily continued the activation of Wi-Fi hotspots.
By end 2013, our customers could make use of approximately
800,000 hotspots in Belgium and, through our cooperative
venture with FON, even as many as 12 million hotspots
worldwide.
A step forward in simplifying our
networks
The simplification of our networks aims to reduce our operating
costs in the long run and to allow us to become a more efficient,
agile company.
End-2013 we managed to migrate all 410,000 telephone lines and
240,000 data lines to new, more modern platforms.
We also informed the BIPT, the telecom regulator, of our 19 technical buildings that we wish to vacate in the coming years.
NETWORKS
A positive trend in 2013 was the higher level of customer satisfaction we achieved thanks to a better service delivery and the
added focus on simpler, easier-to-use new products.
Rising satisfaction indicators
Customer satisfaction with installations rose in 2013 to a record
high of almost 82%. The reliability and stability of our networks
and systems also increased by 10% compared with 2012,
thereby also contributing to these good results.
By simplifying our IT systems we also could increase the efficiency of our customer service (see also page p.20).
Richer TV experience
In June 2013, Belgacom launched a faster, more responsive and
more energy-efficient TV decoder, in order to offer customers
enhanced and more personalized content. We also created Wi-Fi
Bridge, allowing high-quality wireless reception of TV channels on
one or more TV sets.
We also made our TV Everywhere app considerably more userfriendly. It now takes only a few seconds to start the app and
enjoy Belgacom TV on a smartphone or tablet.
28
We further enhanced Belgacom TV with the TV Replay option,
enabling to watch TV programs up to 36 hours after broadcast,
obviating the need to record them. In an initial phase this new
option will be tested with 10,000 interested customers.
POWERFUL MOBILE
A
NETWORK WHEN IT
MATTERS
At big events such as Rock Werchter, Dour
Festival, Tomorrowland, etc., Belgacom’s
mobile network once again demonstrated its
quality. Even the familiar peak in calls, text
messages and data traffic on New Year’s Eve
passed seamlessly. That day, the network
processed 30 million text messages, while
the mobile data traffic doubled compared
with 2012.
Further evolution of cloud offering
Belgacom is constantly extending its cloud infrastructure to keep
up with the growing demand from residential and business customers.
The business customers offering was extended with the Office
365 package, a solution for storage, back-up and a web shop.
FOCUS
FOCUS
In a first step, we started with the outphasing of old telephony
and data equipment and freeing up 250,000 m² of technical
space (i.e. one-fourth of our total technical space) by outphasing
around 25 technical buildings.
A better service and a series of new
services for our customers
ACTIVATION OF A FIRST
TEST USER ON OPTICAL
FIBER
In 2013, an important step was taken to
installing optical fiber. For example, an
optical fiber connection (“Fiber to the Home”
or FTTH) was installed for the first time on
the site of a test user based on a newly
developed standard method. The advantage
of optical fiber is that it allows a much higher
network speed than copper cable.
Belgacom launched a personal cloud solution for residential
customers, allowing them to save and manage contacts, photos,
music and videos on a smartphone, tablet, laptop or PC. In an
initial phase, this solution is being tested by 6,000 interested
customers.
Moreover, Belgacom is always looking ahead to fulfill customers’
needs over 5 to 10 years. This means that Belgacom is investing
today in a future with faster and smarter fixed and mobile networks.
Finally, Belgacom continues to support sales and support services with new IT solutions, in order to provide our customers
with even better and more efficient service in the coming years.
A “WHOLESALER” ACTIVITY
WHICH IS PARTICULARLY
IMPORTANT
>> Though less known, Belgacom’s unique
customer experience is also evident on the
so-called wholesale market. Through its
Carrier & Wholesale Solutions division, Belgacom provides a series of telecom solutions
to many operators in Belgium: connectivity
services, high-speed access (DSL), etc.
>> Belgacom’s wholesaler activity has been
developed following the liberalization of
telecoms. To stimulate free competition, the
regulator required the incumbent operator to
open its networks to third parties. Over the
years, Belgacom has been able to count on a
growing number of customer operators, both
on the corporate market and the residential
market. An increasing proportion of agreements signed between operators is no longer
linked to the regulatory context but is part of
broader commercial partnerships.
>> Facilitating partnerships with third parties
One of Belgacom’s priorities as a wholesaler
is to create an open model facilitating the
creation of partnerships with other operators,
particularly mobile virtual network operators
(MVNOs), but also “over-the-top” players
which offer telecom services on the Internet
without going through the traditional networks. These partnerships make it possible
to speed up the return on the massive investments in networks and platforms.
>> Launch of SNOW
Snow, a triple-play offer (television, fixed
telephony and Internet) of Base became
operational. It is the result of a 5-year
commercial agreement between the Dutch
operator KPN and Belgacom’s wholesale
division.
50%
>> 4G coverage
(56 Mbps peak speeds)
3.4%
>> 3.4% of Belgacom revenues are generated
by the national wholesale activity
29
We continuously want to improve the quality of our existing
networks. We make every effort to simplify our networks and
devote extra attention to simplify our products and services for
our customers.
NETWORKS
Strong foundations to build the future
MARKET
HUMANCONTEXT
RESOURCES
30
A MORE AGILE
ORGANIZATION
More than ever, Belgacom needs
motivated, highly productive employees
to take on the challenges of a hypercompetitive market. Our structures and
working methods must become more
agile to meet the growing demands of
our customers. Being good is not enough
anymore. We need to be excellent.
In 2013, the company continued to invest
in developing its talent pool in order to
make collaboration, trust, transparency
and agility part of its DNA.
Nobody has as much impact on the performance of an employee
as his or her immediate superior. In this regard, one of Belgacom’s priorities in 2013 was to reinforce the leadership skills of
our managers and executive staff and their ability to adapt to
change. This culture development track is being implemented
top-down, from Management Committee members to field team
leaders.
More accountability and mutual trust
Belgacom has defined 4 pillars for managers and executive staff
for their daily interaction with their employees: team spirit (sharing
success as well as failure); respect and recognition; open and
constructive communication; and promotion of transparency.
Such a change in culture takes a number of years. In 2013, this
transformation was stimulated with 2 training and awareness
programs for managers and executive staff.
FOCUS
Good to Gold
A COMPANY FAVOURING
DIVERSITY
>> Age diversity
Belgacom considers diversity as an asset. In 2013,
special emphasis was placed on age diversity. When
developing HR projects, particular attention is now
paid to the stage of life our employees are in rather
than their age.
>> Gender diversity
Gender diversity is at the heart of our HR approach
and has become focus of attention in the traditionally
most “male dominated” departments. The SDE (networks) and EBU (business customers) divisions have,
among other things, held information and awareness
sessions on gender diversity and the importance of
gender equality in managerial positions.
This track aims to encourage a new culture striving for excellence, as being good at what we do is no longer enough. One of
Belgacom’s challenges is to put the technical skills, of which the
intrinsic qualities are widely recognized, into practice. It is not just
about having the know-how, but applying it within the teams on a
daily basis.
Since a top-down approach was chosen, Belgacom’s Management Committee first followed this program, succeeded by just
over 600 team leaders in 2013. About 1,100 others will follow in
2014. This training is given by about 20 high potential managers
or employees, who received special coaching to act as a link in
the change process.
Lead 21
The Lead 21 program, which was launched in 2012, has been
extended to all team leaders. As many as 865 employees have
followed this 5-day course. The aim is to ensure that every team
leader has leadership skills as well as technical competencies.
Improving these skills becomes a source of motivation and of
professional and personal satisfaction for those following the
program.
31
Team leaders as catalysts of change
MARKET
HUMANCONTEXT
RESOURCES
For Belgacom, its employees are its most important capital. Products can be copied, but not unique know-how and expertise. In
the past, we started with the premise we first should strengthen
our employees engagement. It was generally accepted that more
engaged employees, would also deliver better quality work. However, this assumption was not entirely correct. For example, the
creation of a work environment promoting performance is crucial.
We, therefore, also measure a number of other parameters in our
annual employees survey and initiate improvement actions. These
actions will enable us to evolve into an agile, highly productive
company that can respond effectively to rapid market changes.
>> THE FLEXIBILITY OF ALL IS A PRIORITY.
THE FLEX-PROGRAM HELPS US TO
CHANGE OUR WAY OF WORKING.
1,257
>> 1,257 vacancies were filled in
Initiatives such as Good to Gold and Lead 21 are long-term
projects. Keen for these to have a lasting effect, Belgacom is
making sure that the leadership principles learnt during the training courses are put into practice in each division, such as the
creation of a network of “culture and leadership champions” in
connection with the Good to Gold program. As such, each team
leader makes a lasting contribution to creating a more stimulating and motivating work environment.
2013, 394 by external candidates
and 863 through internal job
moves
30 million
>> Belgacom invested EUR 30 million
in training, i.e. 3% of its payroll
MARKET
HUMANCONTEXT
RESOURCES
A department dedicated to supporting team leaders
32
The Human Resources department has also set up a “Team
Leader Solution Center” to guide and support team leaders. The
latter can turn to the Center with any questions related to the
proper functioning of their teams. This department also organizes
personalized or group coaching sessions, information sessions
and workshops. As leaders guide and direct our staff every day,
they are the force driving the change that Belgacom wants to
implement.
A more flexible working environment
With regard to new working methods, Belgacom intends to
implement in-house the solutions it sells to its customers. The
flexibility of our company and employees is therefore a priority.
In 2013, we speeded up a number of processes, grouped under
the “Flex” program, to make our working methods more flexible
by promoting and supporting teleworking and homeworking. But
it also means providing the necessary tools to evolve towards a
new, digital working environment that is no longer confined to a
desk and chair. To ensure this transition as harmonious as possible, our team leaders can follow a “remote leadership” training. Its purpose is to train our managers and executive staff on
using new tools for communication and guidance, coaching and
remote leadership.
Specific and concrete training courses
Besides providing programs with a direct focus on leadership
and adapting to change, Belgacom continued to invest in special
training courses for a large number of targeted employees. For
instance, the “Shop of the Future” courses, which help our sales
staff serve customers better in our stores, and a whole series of
high-level technical courses for our technicians and engineers.
We also innovated with a course on the use of social media and
one on managing absenteeism to increase overall efficiency of
our teams.
A culture of dialog
>> To stimulate employee engagement and an open
dialog across hierarchical lines, Belgacom has been
conducting an employee satisfaction survey every year
for 10 years. For 2 years now, this survey has been measuring not only employee engagement, but also strategic
alignment and agility. Every year it results in specific
action plans to make the necessary improvements. In
2013, this approach resulted in, among other things,
interactive chat sessions with members of the Board and
the development of a more open and transparent way
of communicating.
The health of a company is a reflection of the
health of its employees. Our Vitality program
includes an intranet site with initiatives and
tips on physical exercise and healthy eating, a
team of employees responsible for promoting
all “health” initiatives in the company, and a
community for sharing ideas and suggestions.
A positive corporate culture
Around 8 out of 10 employees would recommend Belgacom as a
company that is good to work for and would also recommend our
products and services to their family and friends. This is a good
illustration of the fact that our employees are true ambassadors
of our company. An increasing number of employees indicate
that recognition is part of the corporate culture and that they are
receive more feedback to help them improve their performance,
2 areas in which we have noted improvements of about 10%
compared with 2012.
Agility as a factor of change
Finally, we observed progress in the perception of our capacity
to respond to change. Our employees, like Belgacom’s management, say that we must continue our efforts in this area to
further increase the agility of our structures and working methods
in order to prepare for the company’s future and respond to the
increasing demands of our customers. Agility will therefore be a
central priority in the years to come.
The training and development of employees is and remains an
absolute priority for Belgacom. However, the company must also
monitor the hyper-competitive market environment. To avoid
diminishing profit margins and loss of competitiveness, we must
keep our personnel costs under control. In order to achieve these
essential cost-saving measures, we have 2 levers:
Simplify to reduce work volume
We will continue with the simplification of our product lines and
internal procedures, being 1 of our 4 strategic priorities. It will
enable us to cut down on the work volume and the systematic
replacement of employees leaving the company.
Reorganize our structures while keeping social peace
A drastic simplification of some of our structures is unavoidable.
Many employees will be required to show flexibility, even though
we will prefer soft transitions, without jeopardizing our objectives
on the development of human capital.
We will continue to respect the essential principle of social dialog,
as we did in the last few years, even though the market urges
us to seek new balances. We will make every effort to maintain
a constructive dialog with our social partners, as we did when
signing the collective labor agreement for 2013-2014.
2014
Essential cost-saving measures
OUR PRIORITIES IN 2014
Our human resources management strategy is a longterm endeavor. Therefore, instead of turning our priorities
upside down, we will implement measures to become
even more efficient. Our greatest challenge will be to
keep personnel costs under control but also to complete
the transformation of our company culture. Our ambition is to make Belgacom an agile, efficient organization
which is able to restore lasting growth.
33
HEALTHY EMPLOYEES
This year, 72% of our employees took part in the Speak Up
employee survey, measuring not only the level of employee
engagement, but also strategic alignment and agility, 3 pillars
with significant impact on our company’s success. The scores
for these 3 pillars improved compared with 2012, especially with
respect to engagement and strategic alignment, which are in line
with or considerably above the telecom benchmark.
MARKET
HUMANCONTEXT
RESOURCES
FOCUS
Results of the 2013 Speak Up survey
>> MARIO, PETER, NICOLAS-XAVIER,
OLIVIER, LUC, BRUNO, MARC,
WARD AND KOEN
THANKS TO OUR NETWORKS AND
SOLUTIONS, WE COULD WIN MANY
COMPANIES BACK.
>>
MICHAEL AND FREYA
AN EVEN MORE EFFICIENT
SERVICE WITH EVEN A BIGGER
SMILE IN OUR CALL CENTERS.
>> MURIEL AND FRÉDÉRIC
MOBILE OFFENSIVE TOWARDS
SMEs.
>> GILLES, NADIJE AND NATALINA
THIS YEAR BICS HAS DELIVERED
MORE THAN 1.9 BILLION SMS
WORLDWIDE.
>> LAURE-EMMANUELLE
AND MAUREEN
TODAY 29 STORES BRING A
NEW CUSTOMER EXPERIENCE
TO LIFE.
>> DIRK
CYCLOCROSS IN OOSTMALLE
OR BIG FESTIVALS, OUR MOBILE
INSTALLATIONS MUST ALWAYS
REMAIN RELIABLE.
>> ALEXANDRE AND GRÉGORY
THINKING OF NEW PARTNERSHIPS
FOR “OVER-THE-TOP” ACTORS.
>> JOHAN, PHILIPPE AND LARS
AN EVEN MORE PERFORMING TECHNICAL SERVICE FOR
MORE SATISFIED CLIENTS.
>> HILDE, PHILIPPE, WALTER AND NICOLAS
SPORTS ON TOP ON BELGACOM 5, 11, 11+.
>> RACHIDA, WESLEY, BART AND CARLY
SCARLET, SIMPLE AND ACCESSIBLE TELECOM
SOLUTIONS FOR PRICE-SENSITIVE CLIENTS.
>> ILSE, GEERT AND
MURIEL
BELGACOM, FAN OF THE
WHOLE CLAN ;)
>> VÉRONIQUE, THIERRY AND KARL
EVEN SIMPLER IT SYSTEMS FOR A
BETTER CLIENT SERVICE.
>> MARINA
>> MURIEL AND AMAURY
SUPPORTERS OF THE RED DEVILS… ALREADY FOR 20 YEARS.
AT TANGO WE HAVE A REPORTING
SYSTEM THAT ALLOWS US TO
KNOW OUR CUSTOMERS BETTER
AND TO ADAPT OUR OFFERING TO
THEIR NEEDS.
>> CHRISTOPHE AND JORAN
ALWAYS MORE PERFORMING COPPER AND OPTICAL
FIBER NETWORKS.
>> DEBEN, EMMANUEL
AND LUK
LOOKING THROUGH THE
EYES OF THE CLIENT
MEANS IMPROVING HIS
EXPERIENCE WITH OUR
PRODUCTS.
>>
SABINE, INGE, CORINNE, GEORGES AND RONALD
TOWARDS A NEW “FLEX” WORKING ENVIRONMENT IN
LINE WITH THE DIGITAL ERA.
>> FILIP, SYLVIANE AND JEAN-CHRISTOPHE
TV REPLAY, A NEW WAY TO EXPERIENCE TELEVISION.
MARKET
CUSTOMER
CONTEXT
A UNIQUE
EXPERIENCE
FOR EACH
RESIDENTIAL
CUSTOMER
38
ONE BILL FOR THE WHOLE CLAN
>> SINCE APRIL, CUSTOMERS HAVE
BEEN ABLE TO ADD UP TO 6 MOBILE
SUBSCRIPTIONS TO THEIR PACK, GIVING
THEM A DISCOUNT OF BETWEEN EUR 5
AND 10 PER MOBILE.
The Mobile offensive
Belgacom has proved it can respond very fast to the fierce competition. The operator has simplified its offering and adapted
its rates to the advantage of the consumer. By highlighting the
quality of our Proximus network, we have managed to drastically
reduce the number of customers leaving for other operators to
the level of before the mobile market disruption. The repositioning
of our low-cost brand Scarlet with a new, competitive postpaid
and prepaid mobile offer also proved effective to retain and
attract price-sensitive customers.
All these efforts have helped to achieve substantial growth in our
mobile telephone subscriptions (postpaid).
MARKET
CUSTOMER
CONTEXT
Belgacom has managed to reap the fruits of its convergence
strategy on the telecom market, which is highly competitive,
especially in the mobile telephony segment. This strategy enables Belgacom to position itself more firmly as a single operator
that offers access to a wide range of communication solutions
and content via different fixed and mobile devices. Belgacom
launched various initiatives to put into practice its strategy to
bring life to screens anywhere, anytime and whenever it suits
the customer. Always with the intention to make life easier for its
customers.
39
Packs with added value at an attractive
price
Our convergence strategy has been well received by consumers,
as shows the growing sales of our Internet Everywhere Packs.
Our Packs today offer more value for an attractive all-in price. We
have succeeded in raising our average revenue per family and are
consolidating our position as a trusted partner for telecom among
an increasing number of households. We also offer families extra
advantages: customers can combine up to 6 mobile subscriptions in one Pack and receive a monthly discount of between
5 and 10 euro for each mobile.
TV Everywhere, our service which enables customers to watch
digital TV on any device, is now included in all Packs.
With Scarlet Trio we have launched a convergent solution for
price-conscious customers.
Q4
Q1
14.14%
Q3
2012
13.1%
Q2
14.8%
8.2%
Q1
11.8%
10.0%
20.6%
33.9%
EVOLUTION OF ENDING SUSCRIPTIONS TO MOBILE
(POSTPAID)
Q2
Q3
Q4
2013
Brands to suit everyone’s needs
In 2013 our marketing teams joined forces to reinforce the complementarity of our brands: Proximus for clients wanting the best
mobile experience and Belgacom for those searching convergent
solutions and a qualitative service. End 2014, our company will
group all solutions – mobile, fixed and IT – under Proximus as the
unique commercial brand (see p. 17). As such, we will keep on
offering the service and reliability of Belgacom together with the
quality and innovation of Proximus. As to Scarlet, this brand shall
offer simple and accessible solutions for price conscious customers under its own brand.
For Belgacom, technological
advancement is not a goal in itself, but
a way of responding to the needs of
our diverse residential customer base,
those needs being freedom, simplicity
and user-friendliness. We continue to
invest in ever more highly performing
fixed and mobile networks and in more
intuitive solutions for customers. In 2013
we continued to focus on optimizing a
services offer in which every residential
customer will find something to his or
her taste.
Continue to strive for simplicity
The words “simple” and “freedom” are characteristic of how our
customer service has evolved. Our support through the contact centers and Belgacom Centers is complemented by new
possibilities for online support via our website www.belgacom.
be. Thanks to our site’s e-Services and the “Help and support
section”, customers can find the answers to their questions
whenever they want. They don’t even have to leave their home.
In 2013, our website saw a significant increase in the number of
satisfied customers.
Building services together with the
customer
We value feedback from customers and, therefore, launched a
number of services in test phase in 2013. For TV Replay (delayed
viewing of a program without recording it) we started a test in
November with the 3 largest Flemish media groups VMMa, VRT
and SBS Belgium. It was later extended to the channels of the
RTL Group and AB Group.
MARKET
CUSTOMER
CONTEXT
Belgacom wants to earn the trust of its customers. All our innovations are, therefore, tested thoroughly for maximum reliability and
user-friendliness.
SCARLET IN THE “LOW-COST” SEGMENT
>> IN 2013, BELGACOM REINFORCED THE
COMPLEMENTARITY OF SCARLET ( FOR
PRICE-CONSCIOUS CONSUMERS) WITH
THE REST OF ITS PORTFOLIO. SCARLET
ALSO REVISED ITS MOBILE SUBSCRIPTION
OFFERING AND LAUNCHED THE
CONVERGENT SCARLET TRIO OFFER.
40
870,000
>> Number of downloads of the
Hello application in 2013
We also started a test phase for Belgacom Cloud, a cloud solution for residential customers. Belgacom Cloud allows customers
to back up their favorite photos, videos, documents and other
content, such as music in a centralized way. They have access to
these media anytime, anywhere and can also easily share them
with family and friends via their smartphone, laptop, tablet or
even Belgacom TV.
Trust also means permanently guarantee our solutions are secure.
To that end, for Belgacom Cloud, we work with F-Secure, a leading international IT security provider.
Points-of-sale where the customer
experience is the central focus
>> TV REPLAY enables the customer to watch
programs until 36 hours after broadcast and
without recording them.
As soon as customers step into a Belgacom point-of-sale, they
must get the attention they deserve and find the solution that
best meets their needs. We have expanded our network of
Experience Stores to 29 modern, attractive points-of-sale
immersing customers in the world of Belgacom possibilities.
Customers can easily try out products themselves and get advice
from our sales teams.
Customers do not want to wait longer than necessary. Therefore,
we launched a new ordering system in the Belgacom Centers
reducing the time to process an order, while considerably lowering the risk of errors.
Ensuring the security of people
and goods
Sometimes the security of goods and people is the reason of
existence of our products: at the start of 2013, we launched
Belgacom Home Control, a solution enabling customers to know
what is happening at home anytime, anywhere via their smartphone, tablet or PC thanks to a comprehensive, simple and
discrete installation, consisting of an exchange, an HD camera,
a smoke detector, motion detectors, and remote controls. Since
November 2013, Belgacom Home Control can even be connected
to the telemonitoring system of Securitas.
Stronger Tango
in Luxembourg
2014
41
PARTNER OF THE RED DEVILS
>> BELGACOM IS THE INSEPARABLE
SPONSOR OF THE RED DEVILS. AGAINST
THE BACKDROP OF THE MEMORABLE
QUALIFYING CAMPAIGN FOR THE
WORLD CUP IN BRAZIL, WE LAUNCHED
SPECIFIC INITIATIVES TO PROMOTE THE
BRAND.
OUR PRIORITIES ON THE
RESIDENTIAL MARKET
>> Our ambition is to further consolidate our leadership
position on the Belgian market. To achieve that it is
necessary to create growth by offering customers
innovative solutions and keep our costs under control.
In this way we will be able to safeguard the vital investments for the future and further strengthen our market
share.
MARKET
CUSTOMER
CONTEXT
>> Tango, the Luxembourg subsidiary of Belgacom, expanded its
content offer for digital TV with new channels, a German-language
interface and an extensive offering for the Portuguese community.
As such Tango has emerged as a major player on the entertainment
market. Belgacom’s convergence strategy is also evident in the Grand
Duchy, where the TV offer is integrated in a Tango Pack.
MARKET
CUSTOMER
CONTEXT
A SINGLE
PARTNER FOR
OUR BUSINESS
CUSTOMERS
42
Companies today are looking for a partner
they can trust. They search a partner that
provides innovative and comprehensive
solutions which give them the necessary
peace of mind. In Belgacom they find a
single partner that couples its expertise
as a telecom provider with high-quality IT
skills. Besides holding on to our leadership
position in telecoms in 2013, we also
achieved some fine results in Unified
Collaboration, cloud computing and
security.
Belgacom, the reference in telecoms
For business customers, the difference between their telecom
and IT needs is becoming blurred and loses relevance, as cloud
computing and mobile applications are catching on. The self-employed, SMEs and large enterprises prefer solutions allowing
them to take maximum advantage of new technologies. In this
context, Belgacom’s convergence strategy is bearing more and
more fruit: in 2013, the service provider remained leader in its
traditional telecoms market despite a vigorous mobile market
shake-up. The actions for keeping business customers were
effective.
Win-back of large customers
Belgacom also managed to win back quite a few customers.
Large enterprises, such as BNP Paribas Fortis and bpost, put
their trust in us again, returning to Belgacom for their mobile
telephony. The quality of our network and service was the decisive factor for their decision.
>> TELINDUS LUXEMBOURG HAS
CONCLUDED A PARTNERSHIP WITH
IBM AS A SUBCONTRACTOR FOR
TELECOMMUNICATION AND STORAGE
INFRASTRUCTURES.
701million
>> EUR 701 million from IT revenues in 2013
Excellent growth on the IT markets
MARKET
CUSTOMER
CONTEXT
Besides telecommunication, Belgacom is also focusing on a
second pillar of its strategy, the provision of IT solutions that are
closely related to Telco. The company grew in a stagnating market thanks to a series of fine projects aimed at delivering solutions instead of just selling technologies.
Total solution for the Flemish Roads and Traffic
Administration
A good example is the contract with the Flemish Roads and
Traffic Administration for a project on automatic license plate
recognition showing the combination of Belgacom’s strengths.
Together with our partners, we provide a comprehensive solution
which seamlessly combines the connectivity and infrastructure
(the cameras) with the license plate recognition software. It
also helps the traffic police carry out its prevention and control
duties, thereby facilitating road traffic analysis. The solution also
promotes the exchange of information on a local, regional and
national level. Thanks to the agreement between Belgacom and
the Flemish Roads and Traffic Administration, the service can
be extended to all Flemish cities and municipalities. Brecht and
Brasschaat are already pioneering in this area.
FOCUS
Further growth of the cloud services
HISTORIC CONTRACT FOR
TELINDUS LUXEMBOURG
>> Together with Belgacom, Telindus Luxembourg concluded
this year by signing the most important project in its entire
history.
By partnering with IBM as a subcontractor for telecommunications and storage infrastructures, Telindus Luxembourg
will become a strategic service and technology provider for
Innovative Solutions for Finance (IS4F), which was previously
part of Dexia Group in the form of ADTS, and the vehicle for
servicing organisations such as Belfius Assurances, Belfius
Bank, Banque International à Luxembourg (BIL), Dexia Credit
Local SA, Dexia SA/NV and International Wealth Insurers (IWI).
Telindus Luxembourg has wide experience in outsourcing and
was already a long-term partner of ADTS. The partnership with
Belgacom offers IS4F good coverage of different Belgian and
Luxembourgish customers.
Two years ago, Belgacom launched the BeCloud offer. This
forms the backbone of our Belgacom strategy to provide simple,
intuitive IT solutions. “IT as a Service” offers many advantages,
including predictability of costs. The customer pays only for
the services or storage space he actually uses. Belgacom also
extended its range of available infrastructure services (storage,
hosting and back-up) and software applications (office automation, collaboration tools, etc.) on a “pay-as-you-use” basis. These
services are progressing rapidly. The investments made in the
cloud already resulted in excellent growth figures, both in terms
of revenue and in terms of the number of customers hosted in the
cloud. This proves that there is a real demand from companies.
+12%
>> Evolution of our revenues
from cloud services in 2013
43
(+1.3% compared to 2012)
The example of Henri Essers
Appropriate answers for the work sector
MARKET
CUSTOMER
CONTEXT
44
Eric Bluart
Taxi Eric
Compagnie de taxis
FOCUS
Today, technology makes it possible to evolve towards new
ways of working and collaborating. Companies want solutions
that allow more flexibility and, at the same time, are secure and
reliable. Inside its own walls, Belgacom is fully adopting this new
way of working which offers more openness and flexibility. It can
share this experience with its customers. Its always richer and
diversified offer enables it to provide a wide range of connectivity, communication and collaboration tools. This new way of
working is gradually less linked to a physical desk, and implies
attractive growth opportunities for Belgacom.
A good example of this new way of working can be found at the
company Henri Essers. Founded in 1928, it has grown into one
of the most important European players in transport and logistics for the chemical and pharmaceutical industry. In the past
10 years the company has grown quickly, partly thanks to strategic international acquisitions. Belgacom and Henri Essers looked
for solutions to increase productivity and stimulate a smoother
collaboration between employees in different locations. They
chose a solution based on Microsoft Lync, in combination with
the connectivity and functionality of integrated video and contact
center solutions. “The central management and deep integration
with other Microsoft applications – such as Office, SharePoint,
Outlook, CRM and System Center – were the deciding factors”,
the customer concluded.
Christel Vansimpsen
Sint-Lucie
Culture de cresson
Fred Dumont
Les Collines à Domicile
Traiteur et livraison
CONVERGENT SOLUTIONS
TAILORED TO SMES
The self-employed and SMEs are particularly sensitive
to the attractiveness of our global solutions which
combine fixed and mobile telecom, and IT solutions. In
2013, the percentage of SMEs that opted for such an
offer rose by more than 10%. End August, Belgacom
sold its 50,000th Bizz Pack, an all-in offer with fixed and
mobile telecoms, mobile Internet, collaboration tools
and back-up services in the cloud.
>> “Les Agisseurs”
With its advertising campaign “Les Agisseurs”,
Belgacom is presenting itself as a solutions provider
helping SMEs to achieve their commercial objectives.
Belgacom’s technological solutions save them time,
which they can then spend on their core activities. In the
first phase of the campaign, 15 professional challenges
of small businesses from different sectors were placed
in the spotlight in an attractive way. In the second phase,
from November 2013 to November 2014, these businesses explain how Belgacom helps them in practice to
successfully overcome their challenges.
The feedback on this innovative campaign will help
Belgacom to improve its specific approach to meeting
the needs of the self-employed and SMEs. The aim is
also to share a number of lessons and good practices
with SMEs.
>> Belgacom has chosen for new opener and
flexible ways of working for its employees and
can share this expertise with its clients.
+43%
>> Progression of revenues generated
by our
security solutions for businesses in 2013
Innovations in mobile Internet
45
For a number of years now, Belgacom has been investing in
sector-specific solutions, such as healthcare and transport. The
aim is to create new opportunities for business customers while
making life easier for consumers. In 2013, Belgacom partnered
with BNP Paribas Fortis to launch a mobile virtual wallet, which,
among other things, should make payments easier. The Sixdots
application, now also supported by other large banks, will enable
consumers to pay for products and services via their smartphone,
exchange virtual discount vouchers or centralize their customers’ cards. Each payment is secured with a six-digit secret code
(hence the name Sixdots). The commercial launch of Sixdots via
the joint venture Belgian Mobile Wallet S.A. is scheduled for the
spring 2014.
Problem-free parking with Mobile-for
Mobile-for, the Belgacom subsidiary specialized in solutions
for mobile payments and parking tickets, recorded impressive
growth in 2013. Mobile-for is reaping the fruits of an agreement
for mobile parking with 22 Belgian cities, a collaboration with
Flemish public transport company De Lijn for the electronic
issuing of transport tickets, and innovative payment solutions
for charging electric vehicles (there are already more than a
100 charging stations compatible with Mobile-for). In 2013, more
than 6 million payments for mobile parking were processed via
Mobile-for. The subsidiary’s ambition is to become the preferred
national and international partner of mobility players in the broadest sense.
FOCUS
Sixdots as a benchmark for mobile payments
AN ENERGY-EFFICIENT
DATA CENTER
In April 2013, Belgacom opened a new data center in
Brussels that sets a new benchmark in energy efficiency.
The new data center has a surface area of 2,250 m². Adding it, increased the total surface area of Belgacom’s data
centers (15,000 m²) by 19%.
The data center is managed in an environmentally-friendly
and energy-efficient way. It is built according to the principles of separate cold and hot air flows, powerful cooling
installations, and efficient energy use. This enables
business customers to store servers/equipment with high
energy consumption in the new data center.
Like other Belgacom data centers, the new data center
has the ISO 27001 classification Tier-III+. This means
that it offers an operational reliability of 99.99% thanks to
a fully redundant power supply, supported by dynamic
back-up generators and a cooling system with a capacity
buffer.
The ever greater complexity of cyber-attacks and intrusions in
IT systems, such as those Belgacom experienced first-hand
and from which it learnt the necessary lessons and gained
considerable experience (see page 27), requires ever stronger
security competencies. As a telecom and IT player, Belgacom has
the advantage it can offer global security services. Our Security
Operations Center (SOC) monitors more than 400 million security
incidents every day. It also monitors our customers’ systems
around the clock. In addition, an increasing number of companies
are making use of our unique expertise and entrusting Belgacom
with their security. They do not have to invest in own expensive
equipment or in recruiting security experts wich are hard to find.
They are guaranteed Belgacom watches over their data and
applications, both within the company walls and in the cloud.
MARKET
CUSTOMER
CONTEXT
Growing demand for top-quality security
products
MARKET
CUSTOMER
CONTEXT
EXPERTISE
APPRECIATED
INTER
NATIONALLY
Belgacom has leading-edge skills
recognized internationally. Through
the BICS joint venture, Belgacom, as
a wholesaler (or “carrier”) provides a
series of telecom solutions to more
than 700 operators worldwide.
Indeed, BICS is a highly regarded
leader, both for its voice and mobile
data connectivity services and its
innovative value-added solutions.
46
28 billion
>> Minutes processed in 2013
(+3.4% compared with 2012)
26%
>> of the Belgacom Group’s revenue
A world’s first
In 2013, BICS, a joint venture between Belgacom, Swisscom and
MTN, was the protagonist of a world’s first: the launch of LTE
(4G) roaming between Europe, Asian, North America and Africa.
Worldwide, close to 250 operators have already launched 4G
and want to offer their customers high-speed high quality data
access. To offer them this same experience around the world
requires them to establish connections with all other 4G networks
and that’s where the expertise of BICS comes in. Its mission is
to ensure that all types of communications are correctly routed
across the different networks on an international scale. The BICS
services (voice, messaging, roaming, etc.) are in a way the central
interface between several hundred operators around the world.
>> BICS HAS BECOME THE “UNIQUE
CONTACT” OF MANY TRANSNATIONAL
OPERATORS.
In contrast to a worldwide declining voice market, BICS managed
to carry more volume in voice communications. The global erosion of the voice market is both a challenge and an opportunity.
The fact that some competitors in difficulty abandon their activities enables more solid operators to increase their market share.
Combined with a persistent focus and constant investments in
the diversification of its portfolio, this means that BICS has managed to establish itself as a “single contact” for numerous transnational operators. The company serves as a privileged “hub”,
especially in Europe, Africa, the Middle East and Asia. BICS can
also count on a high level of satisfaction among its customers.
RESULTS OF THE BICS
SATISFACTION RESEARCH IN 2013
MARKET
CUSTOMER
CONTEXT
Strategic acquisitions and agreements
EXTREMELY
SATISFIED 13%
VERY SATISFIED 64%
MODERATELY
SATISFIED 19%
SOMEWHAT
SATISFIED 4%
In October 2013, BICS acquired Aervox, a software development company based in Madrid and specialized in roaming and
messaging. The acquisition of Aervox is part of a strategy aiming
to develop new interoperability features and solutions in mobile
data.
47
End December, BICS also announced the integration of activities for international money transfers via GSM in a joint venture
with MasterCard, eServGlobal and BICS. This new company will
enable users to send money to and from a mobile account, from
payment cards, bank accounts and foreign exchange offices, no
matter where they or the recipients are.
BICS also pays close attention to market developments engendered by the arrival of new “over-the-top” players from the Internet world. Through productive partnerships, the Belgacom’s subsidiary continuously increases its penetration in the OTT market.
1.666 billion
>> EUR 1.666 billion of revenues in 2013
(+ 1.3% compared with 2012)
8%
>> of the Group’s profitability (EBITDA)
New value-added services
Today, satisfying customers and dealing with the pressure on
roaming revenues is a challenging reality for operators. In this
regard, BICS distinguished itself in 2013 through the launch of
SMART Webvision. This is a “big data” analysis and monitoring
web application, which allows operators roaming in 2G, 3G and
4G to monitor communication flows in real-time. The operators
can, if required, make the necessary adaptations to improve the
experience of their own customers in roaming and offer them
tailor-made solutions.
Our priorities for the future
BICS operates on an extremely competitive global market which
requires a very high level of expertise. It is therefore constantly
looking for highly sought-after technical talent possessing specific skills.
The quality of its teams and technologies should enable BICS to
stay one step ahead of its competitors and speed up the deployment of new value-added services, which complement its proven
carrier services offering.
Growth of voice traffic on a declining
market
FINANCE
MANAGING
FINANCIAL
MEANS MORE
EFFICIENTLY
48
In 2013, the full impact of the mobile
disruption increased pressure on
revenues and overall profitability.
Although Belgacom’s successful
commercial response did limit the
impact of the value destruction in
the mobile market, this illustrates that
the simplification and management
of our cost structure are essential
for preserving our market leader
position and the development of our
growth strategy.
Belgacom has embarked on a vast cost-optimization program
these past few years. This efficiency effort has already resulted in
savings but these efforts will need to be intensified going forward.
The priority now is to continue this transformation and increase
efforts to simplify products and processes (see page 20). In this
way, the company is moving towards a culture of change and
efficiency.
The Wings program, launched in 2011, focuses on operational
efficiency, or put simply, the optimization of each company
expense. This vast plan is now deeply anchored in the organization, and, is based on 3 pillars:
Focusing on value
all levels to streamline our product portfolio,
change our way of working, and increase
our efficiency.
Increasing efficiency
More than 80 measures have been taken at all levels to
streamline our product portfolio, change our way of working, and
increase our efficiency. Most of these measures focus on creating synergies between departments. It is Belgacom’s ambition
to provide a flawless experience to the customer, from start to
finish, in each of his contacts with the company. In this regard,
the teams responsible for human resources and IT systems play a
crucial role as facilitators. Indeed, a more collaborative business
model implies a culture of performance and change shared by all
employees, and well-oiled, interconnected IT systems.
Substantial gains in efficiency have been made by setting up
shared services centers which bring together a number of administrative tasks, through the optimization of the sales channels,
the grouping and renegotiation of outsourcing contracts for the
call centers, the optimization of team work in certain technical
services and the rationalization of the utility vehicle fleet to meet
real needs.
Our approach to sales channels has also been revised to make
the latter more profitable and lead the customer to the most
suitable channel. We encourage our customers to use our Internet services and self-service to order basic products or to find
answers to their questions, while offering them a personalized
service in the Belgacom points-of-sale for transactions with a
higher value.
The move towards a management culture based on value
requires the involvement of all team leaders. This is why we regularly organize awareness-raising sessions to explain what value
creation and management consists of and what its objectives are.
Building confidence in the future
Belgacom’s vast efficiency program has now been integrated
within the different operational departments, which are now staging posts and fully assume their role of transformation engine. We
are convinced that this strategy will bear fruit in the future. In fact,
our gains in efficiency allow us to continue to invest in networks
in order to offer the best possible service to our customers and
generate sustainable growth.
Buying better
Belgacom has embarked on a global program to revise its purchasing and sourcing approach. Our principle: buy less, buy
cheaper, buy better. It is not just about negotiating the best price
for each individual contract; it is about developing a “procurement system” where the procurement function acts in partnership
with the business and finance to create greater value. This partnership acts also on the demand side: buying less by eliminating
waste, for instance by means of newly introduced sophisticated
forecasting models. Managing the demand side in partnership
with the business also stimulates the reflection on finding the
right balance between value on the one hand, and requirement
specifications on the other. It turns out that for certain deliverables, it is perfectly possible to adjust functional or technical
requirements to achieve lower prices, without compromising the
service level for the customer or end user. Moreover, in no way
do we question the ethical and ecological standards and principles incorporated in our specifications. As we explain in our
chapter on Belgacom’s contribution, our social responsibility is
also reflected in our purchasing policy. The contracts concluded
with new providers in so-called lower-cost countries all meet the
intrinsic quality criteria with regard to ethics.
WINGS AMBITION: FUEL
THE GROWTH STRATEGY
THROUGH EFFICIENCY
EFFICIENCY
IMPROVEMENTS
VALUE
SOURCING
>> 8
0+ efficiency
measures
>> Buying cheaper,
better, and less
>> Optimization
of structural
levers for cross
business units
synergies
>> J oint efforts of
sourcing and
business units
>> K
ey efficiency
enablers HR
and IT
>> F ocus on
bottom-line
impact in the
P&L
VALUE BASED
MANAGEMENT
>> T
ools to
manage value
creation
>> V
alue Based
Management
principles
49
>> M
ore than 80 measures have been taken at
FINANCE
+80
Improving our knowledge of customers and taking the right
measures throughout the complete customer lifecycle are important ways to steer the company from a value perspective. A
refined segmentation allowed us to provide our customers with
the right offer, at the right time, depending on whether the customer is more sensitive to price or seeks the most complete and
high-quality service possible. Implementing value management
has helped us to optimize the financial means, ensuring this way
that acquisition, development and retention costs are linked to
value creation. It is all about changing the approach of recent
years, where value was mainly driven by a growing customer
base.
Since March 2004, Belgacom’s shares
have been listed on Euronext Brussels
under the ticker symbol BELG.
The Belgacom share is a.o.
included in the following leading
indices: BEL20, STOXX Europe
600 Telecommunications index, STOXX
Europe 600, Bloomberg Europe
Telecommunications and
FTSE Eurofirst 300 index.
MARKET
BELGACOM
CONTEXT
SHARE
BELGACOM
SHARE
50
Belgacom share performance
2013 was a good year for the telecom sector as a whole. Compared with the overall market (SXXP index up 17.4% year-overyear), the telecom sector (SXKP index up 32.1% year-over-year)
outperformed it with 14.7 p.p. Furthermore, the BEL20 closed
the year 2013 18.1 % higher versus end-2012. A strong trigger
for this sector outperformance came from improved sentiment
around regulation and Vodafone selling its stake in Verizon to the
latter, which created increased consolidation hopes in the whole
sector. In comparison with this sector outperformance, the Belgacom share had a tougher year. This was caused by the mobile
price war that started at the end of 2012, but also impacted 2013.
The Belgacom share closed 2013 3.15% lower versus end-2012
with a closing price of EUR 21.55 on 31 December 2013. Meanwhile the average trading volume increased by 34.0%. The share
reached its year-high closing price of EUR 23.25 on 9 January
2013 and its lowest level on 22 July 2013 with a closing price of
EUR 16.32.
2013 saw a fairly stable start pending the kick-off of the telecom
sector’s reporting season. With the announcement of the 2012
results, the market reacted disappointed to Belgacom’s outlook
for 2013. This downward trend continued in March with the lower
visibility on the Belgian mobile market creating further uncertainty.
The Belgacom share went ex-dividend on 23 April 2013. The
first-quarter results were positively received, though the market
still feared mobile back book repricing risks. In anticipation of the
second-quarter results, June appeared to be a stable month. This
calm continued in July, but was then disrupted by a profit warning
and dividend suspension by one of Belgacom’s Belgian peers,
pulling down the Belgacom share to its lowest closing price of
2013. However, the Belgacom share showed outperforming second-quarter results and quickly regained ground. Besides signs
of stabilisation on the Belgian mobile market, the main trigger for
SHARE QUOTATION
Name
Term
Stock market:
First Market of Euronext Brussels
Ticker:
BELG
ISIN:
BE0003810273
National SVM code:
3810.27
Bloomberg code:
BELG BB
Thomson code:
BELG-BT
Reuters code:
BCOM
BELGACOM SHARE PERFORMANCE OVER 2013 AS
COMPARED TO BEL20, STOXX EURO TELECOM 600 (SXKP)
AND STOXX EURO 600 (SXXP)
(source: Thomson One)
29
27
25
23
21
15
02/01
02/02
02/03
02/04
02/05
02/06
02/07
02/08
02/09
Signs of stabilization in
Mobile & Consolidation
optimism
02/10
02/11
02/12
BEL 20 restated
SXXP restated
BELG
SXKP restated
BELGACOM SHARE PERFORMANCE OVER 2013 AS
COMPARED TO ITS EUROPEAN INCUMBENT PEERS
(source: Thomson One)
38
33
26
the share recovery was the news in September that Vodafone
would sell its 45% stake in Verizon Wireless to Verizon Communications Inc. This, in combination with signs of American interest
in European telecom companies, further strengthened the belief
that consolidation in the European telecom market would finally
start to happen. This recovery was halted by disappointment with
in-line third-quarter results and the renewed fear of a new mobile
price war in October. In November, however, the upward movement of the share price continued and Belgacom acquired the
800 MHz spectrum at the minimum price. Finally, on 3 December,
Belgacom went ex-interim dividend; this was made up for before
the year end in combination with some well-received macroeconomic news flows. In this way, the Belgacom share ended
2013 3.15% lower than the year before.
23
18
13
51
8
02/01
02/02
02/03
02/04
02/05
HTO restated
DTE restated
TLSN restated
TDC restated
TEL restated
02/06
02/07
02/08
SCMN restated
TEF restated
ORA restated
TIT restated
BELG
02/09
02/10
02/11
02/12
TKA restated
PTC restated
KPN restated
BELGACOM SHARE PERFORMANCE
2009
2010
2011
20124
2013
Share price high
28.65
29.11
27.64
24.60
23.25
Share price low
21.67
24.31
21.40
20.80
16.32
Share price at 31 December
25.32
25.13
24.24
22.21
21.55
181,364,309
138,569,376
148,786,324
142,139,111
189,753,834
Share information
Annual trading volume (number of shares)
Average trading volume per day (number of shares)
708,454
532,959
578,935
555,231
744,133
Number of outstanding shares
320,614,683
321,482,641
317,648,821
318,321,665
318,759,360
Weighted average number of outstanding shares
320,475,553
321,138,048
319,963,423
318,011,049
318,987,711
Key data per share as reported
EBITDA1
6.14
7.56
5.93
5.55
5.33
Net Income (Group Share)1
2.82
3.94
2.36
2.24
1.98
Ordinary dividend (gross)
1.68
1.68
1.68
1.68
1.68
Interim-dividend (gross)
0.40
0.50
0.50
0.81
0.50
8.2%
8.7%
9.0%
11.2%
10.1%
8.98
6.37
10.26
9.94
10.90
EBITDA1
6.10
6.18
5.97
5.61
5.37
Net Income (Group Share)1
2.79
2.57
2.41
2.29
2.02
Price/earnings at 31 December2
9.09
9.79
10.06
9.68
10.65
Market capitalisation at 31 December (billion EUR)3
8.12
8.08
7.70
7.07
6.87
Gross dividend yield2
Price/earnings at 31 December2
Key data per share before non-recurring
Based on weighted average number of outstanding shares
Based on the last closing price of the respective year
3
Calculation based on number of outstanding shares & last closing price of the respective year
4
Key data per share based on the restated 2012 figures
1
2
Mobile price
war pressure
17
MARKET
BELGACOM
CONTEXT
SHARE
19
Our shareholders
Ownership on 31 December 2013
Belgacom’s main shareholder is the Belgian government, owning
53.5% of the Belgacom shares. Belgacom itself held 5.6% of its
own shares at end-2013. The free-float represents 40.9%.
Of this free-float, close to a fourth is held by retail investors and
the remainder essentially by institutional shareholders. Belgacom’s main institutional shareholders are located in the United
States and the United Kingdom followed by Belgium and Germany.
The voting rights of the treasury shares are suspended by law.
The dividend rights of the treasury shares acquired in 2004 are
also suspended, whereas the dividend rights for shares acquired
as from 2005 are cancelled.
MARKET
BELGACOM
CONTEXT
SHARE
End-2013, Belgacom held 18,820,954 treasury shares, representing 5.6% of the total number of shares. In the course of
2013, 219,935 treasury shares were used in a Discount Share
Purchase Plan for Belgacom management and 662,581 options
were exercised.
Under Belgian law, companies are prohibited from owning more
than 20% of their outstanding share capital.
Transparency declarations
According to Belgacom’s bylaws, the thresholds as from which
a shareholding needs to be disclosed, have been set at 3% and
7.5%, in addition to the legal thresholds of 5% and each multiple
of 5%.
52
On 20 March 2013, BlackRock Inc. notified that its shareholding
in Belgacom SA went above the 3% threshold. With 10,321,814
Belgacom shares in its possession on 15 March 2013, BlackRock
Inc. has a participation of 3.05% of the shares with voting rights
emitted by Belgacom SA.
INSTITUTIONAL SHARES BY GEOGRAPHY
22% UNITED STATES
20% UNITED KINGDOM
11% BELGIUM
10% GERMANY
8% SCANDINAVIA
6% FRANCE
5% NETHERLANDS
11% REST OF WORLD
7% REST OF EUROPE
On 9 April 2013, BlackRock Inc. notified Belgacom SA that since
4 April 2013 its participation in the total amount of 338,025,135
shares with voting rights emitted by Belgacom SA went below the
3% threshold.
On 13 May 2013, BlackRock Inc. notified Belgacom SA that:
>> a
purchase of voting rights as at trade date 6 May 2013 caused
its participation in the total amount of 338,025,135 shares with
voting rights emitted by Belgacom SA to reach 3.00%, with
10,152,158 shares in its possession: accordingly, BlackRock’s
holding reached the 3% threshold;
(source: Shareholder analysis September 2013)
SITUATION 31 DECEMBER 2013
Belgacom
ownership
Shares
% Total
shares
% Voting
rights
% Dividend
rights
180,887,569
53.5%
56.7%
55.9%
18,820,954
5.6%
0.0%
1.3%
Free-Float
138,316,612
40.9%
43.3%
42.8%
TOTAL
338,025,135
100.0%
100.0%
100.0%
Belgian State
Belgacom own
shares
TREASURY SHARES EVOLUTION
Status 31 December 2012
19,703,470
>> a
sale of voting rights on 7 May 2013 caused BlackRock’s
holding to cross back below the 3% threshold.
On 5 November 2013, BlackRock Inc. notified Belgacom SA that:
>> a
purchase of voting rights as at trade date 31 October 2013
caused its participation in the total amount of 338,025,135
shares with voting rights emitted by Belgacom SA to reach the
3% threshold.
On 31 October 2013, BlackRock Inc. held 10,151,240 shares or
3.00% of Belgacom’s total shares.
Options exercised during 2013
-662,581
On 2 December 2013, BlackRock Inc. notified Belgacom SA that:
Discount Purchase Plan employees
-219,935
>> a
sale of voting rights on 7 November 2013 caused BlackRock’s
holding to cross below the 3% threshold.
Status 31 December 2013
18,820,954
On 11 December 2013, BlackRock Inc. notified Belgacom SA that:
>> a
purchase of voting rights at trade date 6 December 2013
shares with voting rights emitted by Belgacom SA to reach
3.00%, with 10,143,633 shares in its possession: accordingly,
BlackRock’s holding reached the 3% threshold.
The shareholder remuneration policy is based on a number of
assumptions regarding future business and market evolutions,
and may be subject to change in case of unforeseen risks or
events outside the company’s control.
Shareholder return from the financial year 2013
Following the above-mentioned commitment, the Board of Directors approved in October 2013 the payment of an interim dividend of EUR 0.50 gross per share.
Belgacom SA holds 18,820,954 treasury shares, representing
5.6% of the total number of outstanding shares. The Belgian
state holds 180,887,569 shares, representing 53.5% of the total
number of outstanding shares.
On 27 February 2014, the Board of Directors decided to propose
an ordinary dividend of EUR 1.68 per share to the Annual Shareholder Meeting of 16 April 2014. As a result, Belgacom expects
a dividend of EUR 2.18 gross per share for the 2013 full-year
results. After approval by the Annual Shareholder Meeting, the
normal dividend will be paid on 25 April 2014, with record date on
24 April 2014 and ex-dividend date on 22 April 2014.
To Belgacom’s knowledge, no other shareholder owned 3% or
more of Belgacom’s outstanding shares as at 31 December 2013.
This brings the 2013 total shareholder return to EUR 702 million,
including the interim dividend.
Notifications of important shareholdings to be made according to
the Law of 2 May 2007 or Belgacom’s bylaws should be sent to:
Furthermore, Belgacom’s Board of Directors intends to continue
to award Belgacom’s shareholders with an attractive and sustainable dividend. Therefore the Board of Directors intends to pay
out a stable yearly dividend of EUR 1.50 per share (interim dividend of EUR 0.50 and ordinary dividend of EUR 1.00) for the next
3 years to come, provided Belgacom’s financial performance is in
line with its expectations.
>> FSMA (former CBFA) on [email protected]
>> Belgacom on [email protected]
Investor Relations
Belgacom Investor Relations (IR) aims at ensuring open communication with the Belgian and international investment world on a
regular basis. Through transparent, consistent dialog with investors and financial analysts, the Group strives for a fair share value
based on high-quality financial information.
The Belgacom IR team offers daily support to the retail and institutional shareholders as well as to the sell-side analysts.
A strict quiet period is observed 4 weeks before the issuing of a
quarterly report and 6 weeks before the communication of the
annual results.
Shareholder remuneration
Shareholder return policy
Belgacom commits to an attractive shareholder remuneration policy by returning, in principle, most of its annual free cash flow (2)
to its shareholders.
The return of free cash flow either through dividends or share
buybacks will be reviewed on an annual basis in order to keep
strategic financial flexibility for future growth, organically or via
1.68 2.18
1.68 2.18
0.50
0.50
0.50 0.31
0.50
1.68 2.18
1.68 2.08
0.40
1.68 2.49
1.68 2.18
07
08 09
10
11
12
13(1)
1.68 2.18
06
1.60 1.89
0.50
05
0.50
04
0.29
1.52 1.52
1.38 1.93
DIVIDEND PER SHARE (IN EUR)
0.55
To keep Belgacom’s current and potential shareholders informed,
Belgacom’s management speaks to the financial community on a
regular basis. Each quarterly results announcement is followed by a
conference call or investor/analyst presentation during which maximum time is reserved for a “questions & answers” session. Twice a
year, following the full-year and half-year results, Belgacom organizes a roadshow with top management covering the most important
money centres of Europe and the United States. Furthermore,
Belgacom participated in several major international investment
conferences. In between these events, meetings and conference
calls with senior management are organized. In all these activities,
management is supported by the Investor Relations team (IR).
Interim dividend
Extra-ordinary dividend
Normal dividend
Subject to approval by General Shareholder Meeting
(1) FINANCIAL CALENDAR
16 April 2014
Annual General Shareholder Meeting
22 April 2014
Ex-dividend listing of shares
25 April 2014
Payment of ordinary dividend
9 May 2014
Announcement of first-quarter results 2014
1 August 2014
Announcement of half-year results 2014
24 October 2014
Announcement of third-quarter results 2014
Note that these dates may be subject to change.
(2)
elgacom defines free cash flow as cash flow generated by operating activities, minus
B
capital expenditures and including other investing activities such as acquisitions or
divestments
53
>> a
sale of voting rights on 26 November 2013 caused Blackrock’s holding to cross back below the 3% threshold.
selective M&A, with a clear focus on value creation. This also
includes confirming appropriate levels of distributable reserves.
BELGACOM SHARE
>> a
purchase of voting rights as at trade date 8 November 2013
shares with voting rights emitted by Belgacom SA to reach
3.01%, with 10,166,775 shares in its possession: accordingly,
BlackRock’s holding moved back above the 3% threshold;
MARKET
CORPORATE
CONTEXT
GOVERNANCE
CORPORATE
GOVERNANCE
STATEMENT
54
Corporate governance aims to define
a set of rules and behaviours according
to which companies are properly
managed and controlled, with the
objective of increasing transparency.
It is a system of checks and balances
between the shareholders, the Board
of Directors and the management.
Belgacom is committed to comply with
the legal and regulatory obligations and
best practices.
Belgacom governance model
At Belgacom, the Articles of Association are strongly influenced by
the specific legal status of the company. As a limited liability company
under public law, Belgacom is in the first instance governed by the Law
of 21 March 1991 on autonomous public sector enterprises (“the 1991
Law”). For matters not explicitly regulated otherwise by the 1991 Law,
Belgacom is governed by Belgian corporate law. The key features of
Belgacom’s governance model are:
>> a
Board of Directors, which defines Belgacom’s general policy and
strategy and supervises operational management;
>> the creation by the Board of Directors within its structure of an Audit
and Compliance Committee, a Nomination and Remuneration Committee and a Strategic and Business Development Committee;
>> a
President & Chief Executive Officer, who takes primary responsibility and ownership for operational management (including, but not
limited to, day-to-day management);
>> a
Management Committee, which assists the President & Chief
Executive Officer in the exercise of his duties.
Designation applicable Code on Corporate
Governance
Belgacom designates the 2009 Belgian Code on Corporate
Governance as the applicable Code.
Board of Directors
As provided for in the 1991 Law, the Board of Directors is composed of:
>> D
irectors appointed by the Belgian State in proportion to its shareholding;
>> D
irectors appointed by a separate vote among the other shareholders, for the remaining seats. At least 3 of these Directors must be
independent according to the criteria of article 526ter of the Belgian
Company Code and the criteria of the Belgian Corporate Governance Code. The Board of Directors is composed of maximum
16 members, including the person appointed as President & Chief
Executive Officer.
Today the Board is composed of 14 members.
Changes in the composition of the Board of Directors
The mandates of Ms. Mimi Lamote, Ms. Michèle Sioen and Mr. Michel
Moll came to an end on 23 December 2012. According to the by-laws
of the company, it is up to the Belgian State to renew these mandates
or to replace the members. In the meantime, based on the principle
of continuity, the mandates were tacitly extended. On 20 September
2013, the mandate of Mr. Michel Moll as Chairman a.i. came to an
end and on 27 September 2013, the mandates of Ms. Michèle Sioen,
Ms. Mimi Lamote and Mr. Michel Moll as directors came to an end.
Mr. Stefaan De Clerck was appointed as director and Chairman of the
Board on 20 September 2013.
On 27 September 2013, Ms. Isabelle Santens and Mr. Laurent Levaux
were appointed as directors.
On 15 November 2013 the Belgian State put an end to the mandate of
Mr. Didier Bellens as President & Chief Executive Officer.
On 13 January 2014, Ms. Dominique Leroy was appointed President &
Chief Executive Officer for a renewable term of 6 years.
The Board of Directors must also evaluate the strategic long-term plan
in an extra meeting each year.
In general, the Board’s decisions are made by simple majority of the
Directors present or represented, although for certain issues a qualified
majority is required.
The Board of Directors has adopted a Charter which, together with the
charters of the Board Committees, reflects the principles by which the
Board of Directors and its Committees operate.
The Board Charter provides, among other things, that important decisions should have broad support, understood as a qualitative concept
indicating effective decision-making within the Board of Directors
following a constructive dialog between Directors. They should be
prepared by standing or ad hoc Board Committees with significant
representation of non-executive, independent Directors within the
meaning of Article 526ter of the Belgian Company Code.
The Corporate Governance Charter and the Charter of the Board of
Directors have been updated in February 2014 whereby the notion
“conflict of interest” received a broader interpretation.
Committees of the Board of Directors
In accordance with the by-laws, Belgacom has an Audit and Compliance Committee, a Nomination and Remuneration Committee and a
Strategic and Business Development Committee.
Audit and Compliance Committee
The Audit and Compliance Committee (ACC) consists of 5 non-executive Directors, the majority of whom must be independent. In line with
its charter, it is chaired by an independent Director.
The Audit and Compliance Committee’s role is to assist and advise the
Board of Directors in its oversight of:
>> the financial reporting process;
>> e
fficiency of the systems for internal control and risk management
of the company;
>> the Company’s internal audit function and its efficiency;
>> the quality, integrity and legal control of the statutory and the
consolidated annual accounts and the financial statements of the
Company, including the follow-up of questions and recommendations made by the auditors;
>> the relationship with the Company’s auditors and the assessment
and monitoring of the independence of the auditors;
>> the Company’s compliance with legal and regulatory requirements;
>> c
ompliance within the Company with the Company’s Code of Conduct and the Dealing Code.
The Audit and Compliance Committee meets at least once every
quarter. Messrs. Pierre-Alain De Smedt (Chairman), Michel Moll (till 27
September 2013), Guido J.M. Demuynck, Oren G. Shaffer and Paul Van
de Perre are the members of the Audit and Compliance Committee.
MEMBERS OF THE BOARD OF DIRECTORS APPOINTED
BY THE BELGIAN STATE
Name
Age
Stefaan De Clerck (1)
Didier Bellens (2)
Dominique Leroy (6)
Theo Dilissen
Martine Durez
Laurent Levaux (4)
Isabelle Santens (4)
Paul Van de Perre
Mimi Lamote (5)
Michèle Sioen (5)
Michel Moll (3/5)
62
58
49
59
62
58
54
60
48
47
65
Position
Chairman
President & CEO
President & CEO
Director
Director
Director
Director
Director
Director
Director
Director
Term
2013 - 2019
2003 – 2013
2014 - 2020
2004 - 2015
1994 – 2019
2013 - 2019
2013 – 2019
1994 – 2019
2006 – 2012
2006 – 2012
1994 – 2012
Mandate as of 20 September 2013
Mandate till 15 November 2013
Mandate as Chairman a.i. till 20 September 2013
(4)
(5)
Mandate till 27 September 2013
(6)
Appointed on 13 Januari 2014
Nomination and Remuneration Committee
The Nomination and Remuneration Committee (NRC) consists of 5
Directors, the majority of whom must be independent. In line with its
charter, this committee is chaired by the Chairman of the Board of
Directors, who is an ex-officio member.
The Nomination and Remuneration Committee’s role is to assist and
advise the Board of Directors regarding:
>> the nomination of candidates for appointment to the Board of Directors and the Board Committees;
>> the appointment of the President & Chief Executive Officer and of
the members of the Management Committee on proposal of the
President & CEO;
(1)
>> the appointment of the Secretary General;
(2)
(3)
>> the remuneration of the members of the Board of Directors and the
Board Committees;
MEMBERS OF THE BOARD OF DIRECTORS APPOINTED BY
THE GENERAL SHAREHOLDERS’ MEETING
Name
Jozef Cornu
Age
69
Position
Independent director
Term
2009 - 2015
Pierre
Demuelenaere
55
2011 - 2017
Guido J.M.
Demuynck
63
2007 - 2019
Pierre-Alain
De Smedt
70
2004 - 2016
Carine
Doutrelepont
53
2004 - 2016
Oren G. Shaffer
71
2004 - 2014
Lutgart
Van den Berghe
62
2004 - 2016
>> the remuneration of the President & Chief Executive Officer and
members of the Management Committee;
>> the review on an annual basis of the remuneration philosophy and
strategy for all personnel, and specifically the compensation packages of top senior management;
>> the oversight of the decisions of the President & Chief Executive
Officer with respect to the appointment, the dismissal and the compensation of management;
>> the preparation of the remuneration report and the presentation of
that report at the Annual General Shareholders meeting;
>> c
orporate governance issues.
The Nomination and Remuneration Committee meets at least 4 times
a year.
55
The Board of Directors meets whenever the interests of the company
so require or at the request of at least two Directors. In principle, the
Board of Directors meets every year in 5 regularly scheduled meetings.
MARKET
CORPORATE
CONTEXT
GOVERNANCE
Functioning of the Board of Directors
MEMBERS OF
THE BOARD OF
DIRECTORS
1
2
3
4
5
6
7
8
9
10
11
12
13
14
1. DOMINIQUE LEROY
President & Chief Executive Officer and Director of Belgacom since
13 January 2014, more info see p.60 Management Committee.
MARKET
CORPORATE
CONTEXT
GOVERNANCE
2. STEFAAN DE CLERCK
56
Mr. Stefaan De Clerck is the Chairman of the Belgacom Board of Directors since 20 September, 2013. He has been Member of Parliament from
October 1990 till October 2013. From June 1995 till April 1998 and from
December 2008 till December 2011 he was the Belgian Minister of Justice.
He has been the Mayor of the city of Kortrijk (Belgium) from January 2001
till end of December 2012. Mr. De Clerck holds a Master’s Degree in Law
from the Catholic University of Leuven.
3. JOZEF CORNU
Mr. Jozef Cornu embarked on his career at the Brown Boveri Research
center (now ABB) in Switzerland in 1970. From 1973 until 1982 he held
various positions in Bell Telephone Mfg Co, the Belgian subsidiary of the
ITT Group. From 1982 to 1984 he was CEO of Mietec, a start-up semiconductor company.
From 1984 to 1987 he was General Manager of Bell Telephone Mfg Co.
From 1988 to 1995 he was a member of the Management Board of Alcatel
NV, before assuming the post of General Manager of Alcatel Telecom
from 1995 to 1999. From 2000 to 2008 he was a member of the board of
Alcatel (and later Alcatel-Lucent) and advisor to the chairman until 2004.
From 2006 to 2007 he was chairman of Istag (Information Society Technologies Advisory Group) of the European Union. From 2007 to 2008 he
was chairman of Medea+, the European Eureka programme for research in
Microelectronics.
Mr. Cornu was CEO of Agfa-Gevaert from December 2007 till end of April
2010 and remains a member of its Board of Directors. He is also a non-executive director at KBC. Since November 13, 2013 Mr. Cornu is the Chief
Executive Officer of the NMBS (Belgian railway). He holds a degree of civil
engineer in electrical and mechanical engineering from the Catholic University of Leuven, as well as a Ph.D. in electronics from Carleton University
in Ottawa, Canada.
4. THEO DILISSEN
Since January 2014, Mr. Dilissen is Chairman of the Board of Directors of
Swissport Belgium (Swissport is an international ground handler at airports). Since January 2011, Mr. Dilissen is member of the Board of Directors of Eurostar.
Mr. Dilissen was Chairman of the Board of Directors of Belgacom from
October 2004 till March 2012. From June 2010 until March 2012, he was
CEO of Arcadis Belgium. From September 2005 until the end of March
2009 he was CEO and afterwards Chairman of Aviapartner. Previously Mr.
Dilissen was CEO, Managing Director and Vice-Chairman of Real Software
and from 1989 to 2000 he was COO and member of the Board of ISS
(a Danish publicly listed company). He studied Sociology (Antwerp) and
holds a Master in Business Administration from the Flanders Business
School.
5. PIERRE DEMUELENAERE
Mr. Pierre Demuelenaere is the co-founder, President & CEO of I.R.I.S.
(Image Recognition Integrated Systems), a company created in 1987 to
commercialise the results of his Ph.D.
Mr. Demuelenaere has more than 30 years of experience in Imaging and
Artificial Intelligence. He has accumulated a solid experience in technology
company management, R&D management and setting up of international
partnerships with US and Asian companies (HP, Kodak, Adobe, Fujitsu,
Samsung, Canon…).
Throughout the years, he has remained very involved in defining the R&D
vision of I.R.I.S and has contributed to the development of new technologies, new products and the filing of a number of patents.
Pierre Demuelenaere received the “2001 Manager of the Year” award and
I.R.I.S., the “2002 Company of the year” award. In 2008 he was designated by Data News as ICT personality of the year. He is also member of
the Board of Directors of Pairi Daiza, BSB and Guberna.
In 2013, Pierre Demuelenaere has successfully negotiated the acquisition
of I.R.I.S. Group by Canon. The company is now member of Canon Group.
Mr. Demuelenaere is a civil engineer in Microelectronics from the Université Catholique de Louvain (UCL) and received his Ph.D. in applied
sciences in 1987.
6. GUIDO J.M. DEMUYNCK
10. LAURENT LEVAUX
Until December 2010, Mr. Demuynck was CEO of Liquavista. Before that
he held various positions within Royal Philips Electronics NV from 1976 till
2002. Amongst others, he was Vice President Marketing Audio in the USA,
CEO of Philips in South Korea, General Manager Line of Business Portable
Audio in Hong Kong, CEO Group Audio in Hong Kong.
A ‘magna cum laude’ graduate in economics at UCL (Brussels, Belgium),
Mr. Laurent Levaux began his career at the age of 22 at the head of a small
struggling company in Liège, at the time employing some 100 people.
4 years later the company was turned round, developed, and was merged
with a large international group. He next obtained an MBA from the University
of Chicago (1985) before going to work for McKinsey & Co, where he spent
some 10 years, the last 4 as a partner, undertaking strategic and restructuring
assignments throughout Europe.
He holds a degree in applied economics from the University of Antwerp
(UFSIA) and a degree in marketing from the University of Ghent (RUG).
7. PIERRE-ALAIN DE SMEDT
Mr. De Smedt is since March 2011 the Chairman of the Fédération des
Entreprises de Belgique (FEB/VBO). Before and since June 2006, he was
the Chairman of Febiac (Fédération belge de l’Automobile et du Cycle).
From 1999 till end of 2004 he was Executive Vice President of Renault.
He was chairman of Autolatina, VAG and Ford’s joint venture subsidiary in
Latin America. He served as Chairman of Volkswagen Brazil and Argentina before being appointed as Chairman of Seat. Mr. De Smedt is the
Chairman of the Board of Deceuninck Plastics Group and a member of the
Board of Alcopa (Group Moorkens) and Recticel SA.
He is a graduate in engineering and economics of the University of Brussels (ULB).
8. CARINE DOUTRELEPONT
Ms. Doutrelepont is a lawyer at the Brussels’ Bar and member of the Bar
of Paris. She is the founding partner of the Belgian law firm Doutrelepont
& Partners, which specialises in Information and Communication Technologies, Intellectual property, Media law, Competition matters and European
law.
She holds a State Ph.D in European law from the University of Brussels
(ULB). She is a Professor of Media Law, Intellectual Property Law, and
European Law at the ULB Faculty of law, at the Institute for European
Studies, as well as in universities in other countries. For years, she
worked as an Expert for the European Commission, at the Belgian Senate
and at the Belgian Competition Council.
Since 2008, she is a Member of the Royal Academy of Belgium (Technology and Society Section). She is the author of several books and publications. Ms. Doutrelepont is also member of the Board of King Baudouin
Foundation and of Belfius Bank.
9. MARTINE DUREZ
Ms. Durez was the Chief Financial and Accounting Officer at bpost
until January 2006, when she became Chairman of the Board of bpost.
Ms. Durez was also Professor of Financial Management and Analysis at
the University of Mons-Hainaut until 2000.
She has also served as a member of the High Council of Corporate
Auditors and the Committee of Accounting Standards and as a special
emissary at the Cabinet for Communication and State Companies. She
served as a regent of the National Bank of Belgium. Ms. Durez graduated
as a Commercial Engineer and holds a Ph.D. in Applied Economics from
the University of Brussels (ULB).
In March 2003, Laurent Levaux became CEO of ABX Logistics, a multinational
logistics group, headquartered in Belgium, a company which suffered heavy
losses since its creation in 1998.
From 2003, the results have been constantly improved to reach a level
amongst the best of the industry.
In October 2008, ABX Logistics merged with the Danish Group DSV, quoted
in Copenhagen.
Since October 2008, Laurent Levaux is Chairman and CEO of Aviapartner.
Aviapartner, which is headquartered in Brussels, is a leading player in
ground-handling services to passengers on the European continent.
11. ISABELLE SANTENS
Ms. Isabelle Santens is President and CEO of Andres NV, a Belgian fashion company that designs, produces and distributes the ladies clothing
brands Xandres, Xandresxline and Hampton Bays.
After studies of geography and economy at the Catholic University of
Leuven, she joined Andres in 1985, became Director of Design and turned
CEO in 2000. She turned the company from a mere production orientated
facility to a sales & marketing driven company with focus on building
strong brands and opening pilotstores. She is also a board member in
several cultural institutions.
12. OREN G. SHAFFER
Formerly, Mr. Shaffer was Vice Chairman and Chief Financial Officer of
Qwest Communications from 2002 to 2007 and President and Chief
Operating Officer of Sorrento Networks.
He was already a member of the Board of Directors at Belgacom from
1996 to 2000. He currently holds directorships at Demag Cranes AG
(Germany), Intermec Inc. (USA), Terex Corp. (USA) and XPO Logistics
(USA).
He received a Bachelor of Science in business administration from The
University of California at Berkeley and a Master of Science in management from The Massachusetts Institute of Technology.
13. LUTGART VAN DEN BERGHE
Ms. Lutgart Van den Berghe is Executive Director of Guberna (Belgian
Governance Institute) and Extra-Ordinary Professor at the University of
Ghent (B). She is a Partner of the Vlerick Business School where she
served for many years as Chairman of the Competence Center “Entrepreneurship, Governance and Strategy”.
She is a Member of the Belgian Commission for Corporate Governance
and Non-Executive Director in several companies, such as Electrabel (B)
and Belfius (B). At EcoDA (European Confederation of Directors’ Association), she is a member of the Board and chairwoman of its policy committee. Ms. Lutgart Van den Berghe is doctor in Business Economics of the
University of Ghent (RUG).
14. PAUL VAN DE PERRE
Mr. Van de Perre is the co-founder of GIMV (Venture Capital Firm and listed on
Euronext) and was formerly a director of Sidmar (Arcelor-Mittal), Thomassen
Drijver Verblifa Belgium, Sunparks (division of Sunair) and other companies.
He is currently director of Greenbridge Incubator (University of Ghent), Scientific Investment Board (Universitry of Brussels), president of the Board of
Directors of Thenergo (listed on Euronext), member of the Investment Committee of Participatiefonds Vlaanderen (PMV). Mr. Van de Perre is CEO of Five
Financial Solutions (corporate finance) and CEO of Caesar Real Estate Fund
(real estate finance). Mr. Van de Perre holds an MBA in Economics of the
University of Brussels (VUB) and is a certified accountant (IAB).
57
Until July 2008, he was the CEO of Kroymans Corporation BV in the Netherlands. Mr. Demuynck is also member of the Supervisory Board of Tom
Tom since June 2005. As from January 2011 he joined the Supervisory
Board of Apollo Vredestein BV and the Supervisory Board of Xsens BV.
As from May 2011, he is also a Board member of Teleplan International NV
As from January 2012 he is also Board member of Divitel BV and Aito BV.
In 1995 he joined the Executive Committee of Belgian steel group Cockerill-
Sambre as head of its non-steel subsidiaries, in particular CMI, a loss-making
company, where he was CEO. When he left CMI in February 2003, it was a
debt-free, growing and profitable engineering and maintenance Group.
MARKET
CORPORATE
CONTEXT
GOVERNANCE
In 2000, he became CEO Product Division Consumer Electronics in
Amsterdam and member of the Group Management Committee of Philips.
In 2003, Mr. Demuynck joined Royal KPN where he became member of
the Board of Management and CEO of the Mobile Division (KPN Mobiel
Netherlands; Base Belgium, E-Plus Germany).
The first meeting each year reviews the performance, budgets for
pay-out of bonuses and merits, and long-term and short-term incentive plans. At that meeting an annual review of the philosophy and
strategy of the remuneration is also discussed. At the second meeting
the Nomination and Remuneration Committee fixes the performance
measurement targets of the President & Chief Executive Officer and
the members of the Management Committee through Key Performance Indicators. In addition to these meetings, the Committee
organizes a meeting on Human Resources and a meeting on Corporate Governance.
In 2013, Messrs. Stefaan De Clerck (member and Chairman as of
20 September 2013), Michel Moll (member and Chairman a.i. till
20 September 2013), Jozef Cornu, Pierre-Alain De Smedt, Ms. Martine Durez and Ms. Lutgart Van den Berghe were the members of the
Nomination and Remuneration Committee.
MARKET
CORPORATE
CONTEXT
GOVERNANCE
Strategic and Business Development Committee
58
The Strategic and Business Development Committee (SBDC) consists
of 6 Directors. In line with its charter, the President & Chief Executive
Officer and the Chairman of the Board of Directors are ex-officio
members, and the Committee is chaired by the Chairman of the Board
of Directors. One additional member is chosen among the Directors
appointed by the Belgian State. 3 members must be appointed among
the Directors appointed by the General Shareholders meeting.
The Strategic and Business Development Committee’s role is to review
envisaged acquisitions, mergers and divestments over EUR 100 million
and to review large corporate restructuring programs.
If appropriate, the Board of Directors can decide on establishing a special ad-hoc Committee, dealing with a specific subject, and composed
of members with the appropriate experience.
In 2013, Messrs. Stefaan De Clerck (Chairman as of 20 September
2013), Michel Moll (Chairman a.i. till 20 September 2013), Didier Bellens (till 15 November 2013), Ms. Dominique Leroy (as of 13 January
2014), Messrs. Jozef Cornu, Theo Dilissen, Guido J.M. Demuynck
and Ms. Carine Doutrelepont were the members of the Strategic and
Business Development Committee.
Departure from the 2009 Belgian Corporate
Governance Code
Belgacom complies with the principles and provisions of the 2009
Belgian Corporate Governance Code, except provisions 4.6 and 4.7.
Although provision 4.6 stipulates that mandates of Directors should not
exceed 4 years, the mandates of Belgacom Directors are for 6 years
as prescribed by article 18 of the 1991 Law. Where provision 4.7 states
that the Board appoints its Chairman, article 18 § 5 of the 1991 Law
foresees that the Chairman is appointed by the King.
Transactions between the company and its
Board Members and executive managers
A general policy on conflicts of interest applies within the company.
It prohibits the possession of financial interests that may affect personal judgment or professional tasks to the detriment of the Belgacom
Group.
In accordance with article 523 of the Belgian Company Code, Mr. Didier
Bellens declared, during the Board of Directors of 28 February 2013, to
have a conflict of interest in connection with the “Employee incentive
plans”, item of the agenda of this Board meeting.
In accordance with article 523 of the Belgian Company Code, Ms.
Lutgart Van den Berghe and Ms. Carine Doutrelepont declared, during
the Board of Directors of 2 May 2013, to have a conflict of interest in
connection with the “Project Idar”, item of the agenda of this Board
meeting.
In accordance with article 523 of the Belgian Company Code, Mr. Didier
Bellens declared, during the Board of Directors of 25 July 2013, to have
a conflict of interest in connection with the “Employee incentive plans”,
item of the agenda of this Board meeting.
In accordance with article 523 of the Belgian Company Code,
Ms. Martine Durez, Ms. Mimi Lamote, Ms. Michèle Sioen, Mr.
Michel Moll and Mr. Paul Van de Perre declared during the extraordinary
Board of Directors of 25 September 2013, to have a conflict of interest
in connection with the “Appointment new directors of the Board of
Directors”, item of the agenda of this Board meeting.
On 24 February 2011, the Board adopted a “related party transactions
policy” which governs all transactions or other contractual relationships
between the company and its board members.
Belgacom has contractual relationships and is also a vendor for telephony, Internet and/or ICT services for many of the companies in which
Board members have an executive or non executive mandate. These
transactions take place in the ordinary course of business and at arms
length. Belgacom is also a Partner of Guberna, the Belgian Institute for
Directors (affiliated with Ms. Lutgart Van den Berghe who is Executive
Director of Guberna), for which it has paid a fee of EUR 30,250 in 2013.
Activities Report of the Board and Committee
meetingss
In 2013, 8 meetings took place for the Board of Directors, 8 meetings
for the Audit and Compliance Committee, 6 for the Nomination and
Remuneration Committee and 3 for the Strategic and Business Development Committee.
A list with the attendance of the members is included in the Remuneration Report.
Application of the measures taken by the
company in order to comply with legislation
on insider trading and market manipulation
(market abuse)
The Board performed a self-evaluation in December 2012 in order to
assess its size, composition, performance as well as the interaction
with management. This exercise was conducted with the help of
Spencer Stuart as external expert. Members were invited to answer an
extensive questionnaire, followed by an interview between the external
expert and every individual member. Starting from the conclusions and
the action plan that was agreed upon after the previous evaluation,
members were asked their opinion on corporate governance at
Belgacom, the functioning of the Board, the Board relationships and
the functioning of the committees. As an outcome, the Board decided
at its meeting of 28 February 2013 to implement the following short
term actions:
>> having each year a yearly draft agenda for the committees;
>> organise a tutorial on the role of the committees and on risk management;
>> have a yearly presentation on succession planning to the Board;
>> develop a reporting system, allowing the Board to follow the key
business drivers of the company;
>> add one meeting a year for the strategic committee.
Management
President & Chief Executive Officer
The President & Chief Executive Officer is appointed by the Belgian
State by Royal Decree deliberated in the Council.
Appointments are for a renewable 6-year term, and can be terminated
only by Royal Decree deliberated after discussion in the Council of Ministers. In line with the 1991 Law and the Company’s Articles of Association, the President & Chief Executive Officer is a member of the Board
of Directors. The President & Chief Executive Officer and the Chairman
of the Board of Directors must come from different language groups.
The President & Chief Executive Officer is entrusted with day-to-day
management, and reports to the Board of Directors. In addition, in
line with the 1991 Law and the company’s Articles of Association,
the Board of Directors may, deciding by a majority of two thirds of its
members present or represented, delegate all or part of its powers to
the President & Chief Executive Officer, with the exception of:
>> the establishment of the business plan and general policy of the
company;
>> the supervision of the President & Chief Executive Officer;
>> a
nd other powers explicitly reserved by law to the Board of Directors which include, for example, the establishment of the annual
accounts for submission to the General Shareholders Meeting and
the preparation of merger proposals.
The Board of Directors has delegated broad powers to the President &
Chief Executive Officer.
The current President & Chief Executive Officer is Ms. Dominique Leroy.
Her renewable 6-year fixed-term contract started on 13 January 2014.
Management Committee
The members of the Management Committee are appointed and dismissed by the Board of Directors on proposal of the President & Chief
Executive Officer, after consultation of the Nomination and Remuneration Committee.
The powers of the Management Committee are determined by the
President & Chief Executive Officer. The Management Committee’s role
is to assist the President & Chief Executive Officer in the exercise of his
duties.
The Management Committee aims to decide by consensus, but in the
event of disagreement, the view of the President & Chief Executive
Officer will prevail.
The Management Committee generally meets on a weekly basis.
The Belgacom Management Committee, in addition to the President
& Chief Executive Officer, is composed of the following members (see
table below).
Name
Age
Position
Michel GEORGIS
61
Executive Vice President Group
Human Resources
Dirk LYBAERT
53
Executive Vice President
Corporate Affairs
Geert STANDAERT
44
Service Delivery Engine &
Wholesale
Ray STEWART
65
Finance
Bart VAN DEN MEERSCHE
56
Enterprise Business Unit
Phillip VANDERVOORT
52
Consumer Business Unit
Mr. Bruno Chauvat, who was the Executive Vice President Strategy &
Content left the company on 24 January 2014.
Mr. Dirk Lybaert was appointed as Executive Vice President Corporate
Affairs on 24 January 2014.
Mr. Phillip Vandervoort was appointed as Executive Vice President
Consumer Business Unit as from 1 April 2014.
59
Evaluation of the Board
>> the approval of the Management Contract with the Belgian State
and changes to it;
MARKET
CORPORATE
CONTEXT
GOVERNANCE
In order to comply with legislation on insider dealing and market manipulation, Belgacom adopted a dealing code prior to the Initial Public
Offering. This code aims to create awareness about possible improper
conduct by employees, officers and Directors and the possible sanctions. This dealing code has been widely communicated and is available to all employees. A list of key persons is kept, and all Directors
and key employees were requested to sign an affidavit that they had
read, understood and agreed to comply with the dealing code. Closed
periods (including prohibited periods) are defined, and any deal must
be communicated to and cleared by the Head of Compliance Services
before transaction (see “Compliance” section on p. 61).
MEMBERS OF THE
BELGACOM
MANAGEMENT
COMMITTEE
Mr. Lybaert was since 2005 Secretary-General of Belgacom. From 1995
until 2007 he was an assistant at the Law Faculty at the University of Brussels for the course “Name Contracts”. From 2000 to 2005 he held different
positions within the Legal department of Belgacom. Prior to Belgacom,
he was an officer at the Federal Police, where he reached the position of
Lieutenant-Colonel, director of the Anti-Terrorism Program.
Mr Lybaert has Master’s degrees in Criminology, Law and Business Law,
as well as degrees in Advanced Management and Social and Military
Sciences.
6. GEERT STANDAERT
Geert Standaert joined the Belgacom Management Committee as Executive Vice President Service Delivery Engine & Wholesale in March 2012. In
this function, he oversees all IT development, service engineering, technical infrastructure and operations for the Group as well as the wholesale
activities.
1. DOMINIQUE LEROY
MARKET
CORPORATE
CONTEXT
GOVERNANCE
Since 13 January 2014, Dominique Leroy is the CEO of Belgacom. She
joined Belgacom as Vice President Sales for the Consumer Business
Unit in October 2011 and was nominated Executive Vice President of the
Consumer Business Unit of Belgacom in June 2012.
60
Prior to Belgacom, Ms. Leroy worked for 24 years at Unilever. She was
Managing Director of Unilever Belux and member of Unilever’s Benelux
Management Committee. She previously held various positions in marketing, finance and customer development.
Ms. Leroy is member of the Boards of Tango, Scarlet and BICS and is an
independent Board Member at Lotus Bakeries. Ms. Leroy holds a master
in Advanced Management (Business Engineering) from the Solvay Business School.
Mr. Standaert joined the Group in 1994 and held Director positions in various disciplines, including IT, Infrastructure Operations and Data operations
before becoming Vice President Customer Operations in 2007.
Mr. Standaert holds a Master’s degree in Civil Engineering from the University of Ghent (RUG).
7. PHILIP VANDERVOORT
Phillip Vandervoort has joined the Belgacom Group on 1/4/2014 as
Executive Vice President of the Consumer Business Unit. Before he has
worked with several important companies, such as Dupont de Nemours
International, Union Minière, Interbrew/Inbev and, since 2007, Microsoft
Corporation. Mr. Vandervoort is industrial engineer and is a bachelor in
business administration.
2. MICHEL GEORGIS
From June 2007 until December 2011, Michel Georgis was the Executive
Vice President of the Consumer Business Unit Belgacom. Since 1 January
2012 he is the Executive Vice President Group Human Resources. He is
the Chairman of the Boards of Tango Luxembourg, Scarlet NV Holland
and Wireless Technologies (The Phone House) and member of the BICS
and Pension Fund Boards. As of May 2005 and until the integration in
January 2010, he was the CEO of Proximus (Belgacom Mobile). Prior to
this position he was as of January 2004 the Chief Operations Officer at
Proximus. He joined Proximus in January 2000 as Executive Vice President Sales, Marketing & Customer Operations. Michel Georgis started his
career in 1977 at Coca-Cola Belgium. In 1991 he joined Interbrew, where
he filled different positions before becoming Sales & Marketing Director
Central & Eastern Europe. Michel Georgis holds a Master’s degree in
Applied Economics from the Catholic University of Leuven.
1
2
3
4
5
6
3. RAY STEWART
Ray Stewart is Executive Vice President Finance & CFO. Prior to Belgacom, from 1994 until 1997 he was the Chief Financial Officer for Matav,
the incumbent telephone company in Hungary. From 1991 to 1994 he
was the Chief Financial Officer for Ameritech International which was the
International Business Development unit for Ameritech headquartered in
Chicago. He has a Business Undergraduate degree in Accounting and a
Masters of Business Administration in Finance. He is also a Certified Public Accountant. Ray Stewart is also a member of the Board of Directors of
Nyrstar since September 2007.
4. BART VAN DEN MEERSCHE
Bart Van Den Meersche is the Executive Vice President of Belgacom’s
Enterprise Business Unit. Mr. Van Den Meersche joined Belgacom after
28 years of experience in the ICT sector through a professional career
with IBM, of which 16 years in different Management positions, including
8 years as Country General Manager of IBM Belgium/Luxembourg. In
his last year at IBM, he was Vice President Industries & Business Development IBM South-West Europe and a member of the IBM South-West
Europe Executive Management Team. Bart Van Den Meersche holds a
degree in Mathematics from the Catholic University of Leuven. Mr. Van
Den Meersche was during 6 years President of Agoria ICT and also a
member of the Board of Agoria, VOKA and VBO/FEB.
5. DIRK LYBAERT
Dirk Lybaert is Executive Vice President Corporate Affairs, regrouping the
following areas of responsibilities: Group Communications, Legal, Public
Affairs, Regulatory, Security Governance & Investigations.
He is also the Secretary of the Board of Directors of Tango Luxembourg
and of the Belgacom Pension Fund, as well as member of the Board of
Belgacom International Carrier Services (BICS) and of Belgacom Opal.
7
Board of Auditors
The Board of Auditors of the company is composed as follows:
>> Deloitte Auditors SC sfd SCRL, represented by Mr. Geert
VERSTRAETEN also Chairman of the Board of Auditors;
>> Romain LESAGE, Member of the Court of Auditors;
Deloitte Auditors SC sfd SCRL, represented by Mr. G. Verstraeten and
Mr. N. Houthaeve, are responsible for the audit of the consolidated
financial statements of Belgacom and its subsidiaries.
The other members of the Board of Auditors are, together with Deloitte,
entrusted with the audit of the non-consolidated financial statements of
the parent company.
Mr. Lesage’s mandate will expire on 30 June 2014, the mandates of
Mr. Rion, Deloitte and Callaert will expire at the annual General Shareholders Meeting in 2016.
Additional fees paid to the auditors
In accordance with the provisions of Article 134 § 2 of the Belgian
Company Code, Belgacom declares the supplementary fees that it
granted during the 2013 financial year to two auditors, members of the
Joint Auditors: Deloitte Auditors SC sfd SCRL and Luc Callaert SC sfd
SPRLU.
The Group spent during the year 2013 an amount of 251,595 EUR
for non-mandate fees for Deloitte Auditors SC sfd SCRL, the Group’s
auditors. This amount is detailed as follows:
(in EUR)
Other mandatory audit
missions
Tax advice
Other missions
Total
Auditor
Network of auditor
10,690
25,250
13,420
173,815
197,925
1,270
27,150
53,670
The Group also spent during the year 2013 an amount of EUR 1,627 for
non-mandate fees paid to Luc Callaert SC sfd SPRLU. This amount is
detailed as follows:
(in EUR)
Other mandatory audit missions
Tax advice
Other missions
Total
Auditor
1,627
1,627
Government Commissioner
On 17 April 2012, Mr. Michel Vanden Abeele was appointed Government Commissioner in order to supervise, in conformity with the 1991
Law, the management of Belgacom from an administrative point of
view. Mr. Amaury Caprasse was appointed Deputy Government Commissioner.
Compliance
Role of Compliance at Belgacom
In an increasingly complex legal and regulatory context and a
changing business environment as well as a difficult economic
situation, compliance plays an important role in the business
world. The Belgacom Group Compliance Office is responsible
for coordinating compliance activities within the Belgacom
Group, explaining the applicable rules, providing with the required
tools to encourage compliance, and ensuring a consistent
approach to compliance within the Group.
Our compliance program is a key building block for our Corporate
Social Responsibility strategy (see p. 22).
All employees must perform their daily activities and their
business objectives according to the strictest ethical standards
and principles using the company values (Respect, Can do and
Passion) as guiding principle.
The Code “The way we do responsible business” sets out the
above-mentioned principles, and aims to inspire each employee in his
daily behaviour and attitudes. The ethical behavior is not limited to the
text of the Code. The Code is a summary of the main principles and is
thus not exhaustive. The principles and the rules in the Code are more
developed in the different internal policies and procedures. The Code is
available on www.belgacom.com.
Organization of compliance activities
The Compliance Office is managed by the Vice President Group Legal,
who reports directly to the Chairman of the Audit and Compliance
Committee (ACC). The ACC Charter determines the ACC’s responsibility in helping and advising the Board of Directors with respect
to monitoring Belgacom’s compliance with the legal and regulatory
requirements, as well as internal compliance with the Code’ “The way
we do responsible business”.
The Compliance Program
Ethical behavior and respect for the values are part of the compliance approach within the Belgacom Group.
In line with the former years actions, the following efforts have been
done in 2013, in order to improve the visibility of the Code of conduct
and its policies:
>> p
articular emphasis was placed on information security. An important awareness campaign has been launched towards our staff
through the intranet and by posters put up in all meeting rooms.
This campaign has also been supported by educational films;
>> in May 2013, Belgacom opened up social media access to all of its
staff. As to support this opening and to raise users’awareness about
a responsible use of these new tools, several initiatives have been
put in place: a policy, training, a film, questions and answers, …;
>> B
elgacom published a new anti-bribery policy, which is entirely in
line with its Code of Conduct and which establishes a zero tolerance principle towards any form of corruption. This policy sets out,
in a single document, all principles that have been developed in
several other policies.
The compliance domains which were the compliance focus areas
for 2013 were :
1. Information security;
2. Responsible use of social media;
3. The Dealing Code;
4. Regulatory compliance;
5. Competition law;
6. Chinese walls;
7. Environment;
8. Privacy.
61
>> Luc Callaert SC sfd SPRLU, represented by Luc CALLAERT.
MARKET
CORPORATE
CONTEXT
GOVERNANCE
>> Pierre RION, Member of the Court of Auditors;
MARKET
CORPORATE
CONTEXT
GOVERNANCE
REMUNERATION
REPORT 2013
Belgacom considers transparency on
executive remuneration very important.
Therefore, in conformity with the corporate
governance law of April 6, 2010 and
Principle 7 of the corporate governance
Code 2009, the company provides
the following information towards its
shareholders and all other stakeholders:
the description of the Directors’
remuneration and a high level explanation
of the Group remuneration policy.
Furthermore, it includes an analysis of our
executive remuneration and provides an
overview of the main provisions of the
contractual relationships.
Didier Bellens was the President & CEO of Belgacom until
November 2013. In January 2014, a new CEO, Dominique Leroy,
has been appointed. With this nomination, a new ceiling has
been defined in the executive remuneration policy of Belgacom.
Belgacom’s executive remuneration policy will further take
into account this new ceiling for every new member in the
Management Committee. In line with the demand at the Annual
Shareholders Meeting of 2013, the Board of Directors has also
reviewed the remuneration of Board members and has compared
this with different benchmarks. These benchmarks show that the
remuneration at Belgacom is in line with the market. The Board
has, however, assessed that in this period, where efforts are
asked from management and from the employees, it is important
to give a clear signal that Board members want to share these
efforts. For that reason the Board has decided that on the
remuneration of 2014 it will apply a reduction of 10 % which
is in line with the proposal of the Management Committee to
voluntarily reduce, for the 2013 performances of the top 170 of
the company, the envelope for the individual part of their shortterm variable remuneration (bonus) by 10%.
Directors’ Remuneration
62
Policy of Directors’ Remuneration
ACTIVITIES REPORT AND ATTENDANCE
AT BOARD AND COMMITTEE MEETINGS
Name
Stefaan DE CLERCK (1)
Didier BELLENS (2)
Jozef CORNU
Pierre
DE MUELENAERE
Guido DEMUYNCK
Pierre-Alain DE SMEDT
Theo DILISSEN
Carine
DOUTRELEPONT
Martine DUREZ
Laurent LEVAUX (4)
Isabelle SANTENS (4)
Oren G. SHAFFER
Lutgart
VAN DEN BERGHE
Paul VAN DE PERRE
Mimi LAMOTE (5)
Michel MOLL (3/5)
Michèle SIOEN (5)
Board
A&CC
SBDC
3/3
1/1
3/3
3/3
75,750
0
89,500
67,000
3/3
94,500
112,000
64,500
72,000
(total 8) (total 8) (total 6) (total 3)
4/4
6/6
8/8
8/8
8/8
7/8
6/8
8/8
8/8
2/4
3/4
7/8
8/8
8/8
4/4
4/4
4/4
6/6
8/8
7/8
6/6
3/3
2/3
6/6
82,000
16,750
21,750
82,000
82,000
8/8
6/6
8/8
3/3
Total
remuneration
(in EUR)
NRC
3/3
Total remuneration: telecom advantage included
2/2
87,000
40,250
113,000
40,250
A&CC: Audit and Compliance Committee; NRC: Nomination and Remuneration
Committee; SBDC: Strategic and Business Development Committee
Mandate till 15 November 2013
(3)
Mandate as Chairman a.i. till 20 September 2013
(4)
(5)
Mandate till 27 September 2013
(1)
(2)
The remuneration and compensation of the Directors was
decided by the General Shareholders’ Meeting of 2004. The principles of this compensation did not change in 2013: it foresees
an annual fixed compensation of EUR 50,000 for the Chairman of
the Board of Directors and of EUR 25,000 for the other members
of the Board of Directors, with the exception of the President &
CEO. All members of the Board of Directors, with the exception
of the President & CEO, have the right to an attendance fee of
EUR 5,000 per attended meeting of the Board of Directors. This
fee is doubled for the Chairman.
Attendance fees of EUR 2,500 are foreseen for each member of
an advisory committee of the Board of Directors, with the exception of the President & CEO. For the Chairman of the respective
advisory committee, these attendance fees are doubled. The
members also receive EUR 2,000 per year for communication
costs. For the Chairman of the Board of Directors, the communication costs are also doubled.
The Chairman of the Board of Directors is also Chairman of the
Joint Committee and of the Pension Fund. Ms. Martine Durez and
Mr. Theo Dilissen are members of the Board of the Pension Fund.
They do not receive any fees for these participations.
For the execution of their Board mandates, the Directors do not
receive performance-based remuneration such as bonuses or
long-term incentive programs, nor do they receive benefits linked
to pension plans.
Overview of Directors’ Remuneration
The individual Directors’ remuneration for the fiscal year 2013,
based on their activities and attendance at Board and Committee
meetings, is presented in the table on the left.
Because of Belgacom’s history as a public-service company,
there are some differences in its dynamics and structure, compared to the private sector. This has a considerable influence
on how its remuneration policy has evolved. Belgacom Human
Resources developed creative and adaptable programs to deal
with its obligations related to the statutory employment status of
some of its workforce, and introduced new elements that harmonised policies between civil servants and contractual employees.
Belgacom’s global reward principles
To accomplish our company goals within a highly and fast
changing competitive global telecom market, we need qualified,
talented and engaged employees working in a high performance
culture. To foster this culture, it is critical to have a competitive
Global Rewards Program.
The objectives of the Belgacom Global Rewards Program are:
>> to drive performance that generates long-term profitable
growth;
>> to stimulate empowerment that reinforces the business
strategy and desired culture;
>> to offer fair and equitable remuneration both to civil servants
and to the group’s contractual employees, according to market practices;
>> to recognize and reward high performance;
>> to link pay to both individual and the overall success of
Belgacom;
>> to enable Belgacom to attract and retain market’s talents
at all levels;
>> to combine the needs and responsibilities of employees and
their families with those of the company and society as a whole.
Belgacom also maintains -and modernizes- powerful public sector instruments, such as work-life benefits (e.g. sick child care,
hospitalisation, …) and social assistance. It is the responsibility
of the Belgacom work-life department to combine the needs and
responsibilities of employees and their families with those of the
company and society as a whole. Over the years, Belgacom has
won several awards for the continuous efforts of the company to
create a balanced working environment for its staff.
The Global Rewards Program keeps up and supports this goal
and mission.
Executive Remuneration
Objectives and the principles of Belgacom’s
executive pay policy
Belgacom has a balanced executive remuneration policy which
rewards executives competitively and at rates which are attractive in
the market, aligning the interests of management and shareholders.
The company wants to attract and retain high performing top executives for its Management Committee and for its senior management.
It wants to reward clear role models, who have a commitment to
high performance and the company values.
Remuneration
element
Description
Strategic role
Base Salary
Involves fixed cash
compensation.
Aims for the median of
the labor market peer
group.
Is based on achievements of annual
measures of which 30%
is driven by Belgacom
Group Performance;
40% by Business Unit
Performance and 30%
to individual leadership
measures.
Performance Value
Plan is based on
Belgacom’s Total
Shareholder Return
versus a predefined
basket of European
telecom operators.
Attraction.
Rewards for performance of
day to day activities.
Short–term
variable pay
Long-term
Incentives
Drives and rewards annual
Belgacom’s performance.
Drives and rewards sound
strategic and business
decisions for the long-term of
Belgacom.
Aligns interests of management and shareholders.
Aligns & drives senior management’s long-term performance with shareholders’
expectations.
Ensures right decisions for
the success of Belgacom.
Attracts and retains talents.
Definition of the level of compensation
The Nomination & Remuneration Committee sets the remuneration policy for top executives and decides on the individual
packages for the President & CEO and the members of the Management Committee. These are regularly verified by benchmarking executive pay against both the BEL 20 companies (Financial
sector excluded) and a set of peer companies in the European
Telecommunications and ICT sector.
The current remuneration policy does not provide for a specific
contractual claw back stipulation in favour of the company for
the variable remuneration of executive managers accorded on
the basis of incorrect financial information, this without deterioration of the various legal provisions applicable between the
concerned individuals and the company (e.g. Acts of 7 July 1978,
12 April 1965 and 10 February 2003, concerning the claw back
possibilities from employees in case of fraud, serious fault and
usual minor fault, civil liability, etc.).
63
Belgacom has an innovative remuneration policy which is regularly assessed and updated through close cooperation with
external Human Resources fora and universities. The remuneration policies of Belgacom’s employees are defined in a process of
dialog with the Board of Directors and the social partners.
The top executives are covered by dedicated reward programs
which focus on the principles of Belgacom’s strategy to consistently
reward high performance by individuals and by the company. To distinguish itself from other employers, Belgacom seeks to excel in the
total package it offers, by providing not only cash but also numerous
other benefits. A fundamental principle of its remuneration policy is
a degree of freedom for executives in choosing how they want to be
rewarded.
MARKET
CORPORATE
CONTEXT
GOVERNANCE
Remuneration Policy
Key performance indicators at Group level:
>> T
he key financial indicator used is the operational cash flow.
>> Important non-financial indicators included are Simplicity and
Customer Experience measuring the progress made in the
simplification and optimization of processes and the customer’s
user experience and Cost transformation measuring efficiency
improvement in cost management.
>> A
nother operational indicator is the “employee engagement
index”, which each year measures employees’ organizational
commitment, job engagement, strategic alignment and agility
amongst Belgacom’s employees.
Policy of executive remuneration
>> T
he key performance indicators concern amongst others convergence, value management, solution centricity, the transformation of the fix and mobile network and the number of new
customers in voice, fix, internet and TV business.
Basic remuneration
60%
BASIC REMUNERATION
34%
SHORT-TERM VARIABLE
REMUNERATION
5.5%
GROUP INSURANCE
PREMIUMS
0.5%
OTHER BENEFITS
BELGACOM MANAGEMENT COMMITTEE
46%
BASIC REMUNERATION
20%
SHORT-TERM VARIABLE
REMUNERATION
20%
LONG-TERM VARIABLE
REMUNERATION
12%
GROUP INSURANCE PREMIUMS
2%
OTHER BENEFITS
* Former President & CEO Long-term Variable
remuneration forfeit due to termination of employment
contract in 2013
Overview of executive remuneration
The executive remuneration policy is built upon fixed components, being the basic remuneration, the retirement and post-employment benefits and other benefits, and variable performance
based components, being the short-term variable remuneration
and the long-term variable remuneration.
Annual variable pay is calculated in relation to performance
against Key Performance Indicators set by the Board of Directors
upon advice of the Nomination & Remuneration Committee. For
2013, these performance indicators included financial indicators
as well as non-financial indicators, at both Group and Business
Unit level. The achievement of these KPI’s are followed-up and
communicated regularly. The results are based on audited financial figures and non-financial indicators measured by internal
and external agencies specialized in market and customer intelligence, of which the processes are audited on a regular basis.
The basic remuneration comprises the base salary earned in the
position of the President & CEO and the members of the Management Committee for the reported year. The former President &
CEO, Didier Bellens, was also a non-remunerated member of the
Board of Directors. During 2013, the members of the Management Committee haven’t received any merit increase. Changes
in the figures are mainly the result of legal indexation in January
2013 and changes within the Management Committee composition.
Short-term variable remuneration
BASIC REMUNERATION
(IN THOUSANDS EUR)
BEFORE EMPLOYER’S SOCIAL
CONTRIBUTION
2012
2,751.0
FORMER PRESIDENT & CEO *
The basic remuneration of the Management Committee is annually reviewed by the Nomination & Remuneration Committee,
based on an extensive review of performance and assessment of
potential provided by the President & CEO, as well as on external
benchmarking data. The company wants to position top executive pay towards the median of the market.
1,026.73
FIGURE 1 : RELATIVE IMPORTANCE OF THE
VARIOUS COMPONENTS OF REMUNERATION
(KPI’S 100% AT TARGET)
2,760.2
64
Key performance indicators at Business Unit level
963.10
MARKET
CORPORATE
CONTEXT
GOVERNANCE
The relationship between the distinct remuneration components
of the Belgacom Management Committee members and the
former President & CEO is illustrated in the figures below. The
figures show the effective and relative importance of the various
components of remuneration paid in 2013.
2013
MANAGEMENT COMMITTEE **
* The variance 2012/13 is explained
by the index and the pay-out on
11 months i.o. 12 but vacation pay for
2014 had to be paid upon departure
** T
he variance 2012/13 is explained
by changes within Belgacom
Management Committee
The company wants to position top executive short-term variable
remuneration for the achievement of targets at 100%. In case
of sustained excellent performance at company, business unit
and individual level, the short-term variable remuneration can
go above the 100% with a cap at 200%.
The Belgacom Group variable pay system reflects the group values, emphasizes the strengths of the Business Units, and creates
incentives for individual performance.
FIGURE 2: THE BELGACOM MANAGEMENT COMMITTEE
POLICY TAKES INTO ACCOUNT GROUP, BUSINESS UNIT AND
INDIVIDUAL PERFORMANCE
RESULT
The short-term variable remuneration includes the actual bonus
paid in the reported year 2013, for performance year 2012. A
linear pay-out curve with an upper and lower limit is adopted for
each component of the short-term variable remuneration.
FIGURE 3: SHORT-TERM VARIABLE
REMUNERATION: PAY-OUT CURVE
%
250
200
150
100
50
0
UNDER LIMIT
TARGET
UPPER LIMIT
This curve determines the short-term variable remuneration that
is granted to the members of the Management Committee, based
on the effective result of each KPI. For the former President &
CEO in 2013 this is capped at 150 %.
The result is indeed calculated based on a predefined formula
which takes into account the different KPI’s at predefined weights.
For the short-term variable remuneration 2013, related to performance year 2012, the following Group KPI’s were defined:
The short-term variable remuneration is paid through one of the
options of the “Short-Term Incentive Plan”. The President & CEO
and the members of the Management Committee can choose to
receive their short-term variable remuneration in cash bonus or
under the “Discounted Share Purchase Plan”.
The Discounted Share Purchase Plan provides the right to buy
allocated shares at a 16.66% discount. The value of this 16.66%
discount is equal to the gross value of the short-term incentives
result. The executive himself finances 83.34% of the full share
purchase price, requiring a significant personal investment. The
shares are treasury shares and are blocked for a period of two
years.
The former President & CEO chose to receive his short-term
variable remuneration through the Discounted Share Purchase
Plan. The majority of the Management Committee has opted for a
cash bonus.
The short-term variable remuneration of the former President &
CEO increased in line with his performance in 2012 while for the
members of the Management Committee it decreased in comparison with last year. The decrease for the members of the Management Committee is mainly due to changes in the composition of
the Management Committee.
>> free cash flow;
>> cost transformation;
As from performance year 2013, although the parameters taken
into consideration in the formula defining the short-term variable
remuneration granted to the President & CEO and to the members of the Management Committee remain unchanged, their
weight has been reviewed so that the impact of the Group KPI
prevails the individual and Business Unit KPI’s.
2012
1,190.1
581.1
On top of the business and company results, the individual performance weights for 30% of the overall short-term pay-out level.
Individual performance is evaluated versus pre-defined measurable objectives.
SHORT-TERM VARIABLE
REMUNERATION (IN THOUSANDS EUR)
BEFORE EMPLOYER’S SOCIAL
CONTRIBUTION
1,393.1
>> employee engagement index.
513.7
>> simplicity & customer experience;
2013
FORMER PRESIDENT & CEO
MANAGEMENT COMMITTEE
65
INDIVIDUAL
30%
MARKET
CORPORATE
CONTEXT
GOVERNANCE
BUSINESS
UNIT
40%
GROUP
30%
Long-term variable remuneration
LONG-TERM PERFORMANCE
VALUE PLAN (IN THOUSANDS
EUR) BEFORE EMPLOYER’S
SOCIAL CONTRIBUTION
1,188
In 2013, Belgacom launched a new long-term incentive plan for
its Executives, the “Long-Term Performance Value Plan” replacing the “Stock Options Plan”. This new plan has been developed
to keep our executive remuneration policy balanced and attractive, as well as compliant with the shareholders’ expectations.
0
Belgacom’s Performance Value Plan aims to be fully performance driven and transparent, aligned on market best practices
and is inspired from Long-Term Incentive Plans used by other
European Telecommunications companies.
MANAGEMENT COMMITTEE
MARKET
CORPORATE
CONTEXT
GOVERNANCE
Therefore, Total Shareholder Return has been selected as performance criteria to drive expected Long-Term Performance of our
executives and to align it with the interests of the shareholders.
66
* Rights are forfeited due to ending
of CEO’s employment contract
Belgacom’s Total Shareholder Return will be measured against
the respective Total Shareholder Return of a basket of 12 other
European telecom operators for the first time at the end of a
3 years performance cycle.
Pay-out Level
Under this Long-Term Performance Value Plan, the granted
awards are blocked for a period of 3 years, after which the Performance Values vest. After this period, the possible exercising
rights depend on the performance of Belgacom’s Total Shareholder Return compared to a group of peer companies.
The pay-out level has been designed in line with the “pay for
performance” principle and depends on the short-term variable
remuneration and Belgacom’s performance. The design of the
Long-Term Performance Value Plan ensures that executives are
rewarded for “above median” returns while there will be limited or
no reward for “below median” returns.
COMPANIES INCLUDED IN THE BASKET ARE
Deutsche Telekom
Telekom Austria Group
Telefonica
KPN
Portugal Telecom
TeliaSonera
Vodafone
BT
Telecom Italia
TDC
Swisscom
France Telecom
Pay-out Options
The members of the Management Committee can choose
between 3 different pay-out options being cash, Discounted
Shares Purchase Plan, and Belgacom’s shares. These options
cannot be combined and the preferred pay-out option has to be
made at the date of grant and is irreversible. In 2013, all members
of the Management Committee have chosen for cash as pay-out
option. This implies employer social contributions to be taken into
account.
A year-over-year overview of the evolution on Long-Term Performance Value Plan cannot be provided due to the change in
Long-Term Incentive Plan design.
From 2004 until 2012, stock options have been granted to the
former President & CEO, and the members of the Management
Committee. Hereafter, an overview of the remaining stock option
plan for the former President & CEO and other members of the
Management Committee is available.
OVERVIEW OF THE FORMER LONG-TERM VARIABLE REMUNERATION
Didier
Bellens
Bruno
Chauvat
Michel
Georgis
Dominique
Leroy
Geert
Standaert
Ray
Stewart
Bart
Van Den
Meersche
on January 1st, 2013,
Stock options remaining from previous years:
585,774
0
258,503
12,665
33,443
297,278
70,000
Number
Year of grant of
options exercised
Number
Stock options lapsed during
Year of grant of
reported year
options lapsed
Number
Stock options forfeited
Year of grant of
during reported year
options forfeited
TOTAL
107,686
2009
-
47,486
2006 &
2009
0
-
4,148
2009
51,453
2009
0
-
478,088
2007-8,
2010-11-12
0
0
211,017
12,665
29,295
245,825
70,000
Stock options exercised
during reported year
OVERVIEW BASIC AND VARIABLE REMUNERATION OF THE FORMER PRESIDENT & CEO
AND OTHER MEMBERS OF THE MANAGEMENT COMMITTEE
2012
2013
2012
2013
963,096
513,715
534,614
0
113,032
14,773
2,139,230
344,906
2,484,136
1,026,727
581,115
0
0
97,804
11,607
1,717,253
365,967
2,083,220
2,760,207
1,393,093
692,913
0
538,377
154,819
5,539,409
1,349,802
6,889,211
2,751,044
1,190,971
0
1,188,272
755,028
120,204
6,005,519
1,673,311
7,678,830
Retirement and post-employment benefits
The former President & CEO was participating in a complementary pension scheme which foresaw an annual contribution of
EUR 73,495.42, yearly indexed. The current members of the
Management Committee have a “Defined Benefit Plan”.
Other benefits
Belgacom Group wants to stimulate its executives by offering a
portfolio of benefits and advantages that are competitive in the
market place. The President & CEO and the other members of the
Management Committee receive benefits on top of their remuneration, including medical insurance, car and other benefits in kind.
Overview
The table below reflects the remuneration and other benefits paid
directly or indirectly to the members of the Belgacom Management Committee in 2013 by Belgacom or any other undertaking
belonging to the Belgacom Group (benefit based on gross or net
remuneration, depending on the type of benefit).
The year-over-year evolution of the figures is mainly the consequence of:
>> the changes in the composition of the management team;
>> the legal indexation of salaries (January 2013);
>> the limited acceptance rate of the stock option plan 2012;
>> the new Long-Term Performance Value Plan design.
Other members of the Management
Committee
Main provisions of the contractual
relationships
Contractual arrangement of former President & CEO
In March 2009, Didier Bellens started the first year of his new
six-year mandate as President & CEO. He had a contract as
a self-employed executive. Nevertheless, he was subject to
employee’s social security charges, in line with Article 11 § 1
of the Royal Decree of November 28, 1969.
This article states that “the application of the law on the social
security system for employees is expanded/extended to those
institutions of public utility and autonomous public enterprises
as well as such individuals who, in their capacity of agent and
against remuneration, devote their principal activity to the dayto-day management or direction of these institutions and enterprises, to the extent no statutory pension regime is applicable to
these individuals”. The former President & CEO’s employment
contract ended in November 2013. There was no pay-out of any
severance pay.
Clauses
The former President & CEO was bound by a non-competition
clause, prohibiting him for 12 months after leaving the group from
working for a competitor of Belgacom Group in Belgium and in
those countries where Belgacom Group generates at least 5%
of its consolidated revenues. If activated by Belgacom, he would
have received an amount equal to one year’s salary as compensation. This clause has not been activated upon departure of the
former President & CEO.
The members of the Management Committee, who are bound
by a non-competition clause prohibiting them for 12 months
after leaving the group from working for any other mobile or fixed
licensed operator active on the Belgian market, will receive an
amount equal to 6 months’ salary as compensation.
Dominique Leroy, Bruno Chauvat, Geert Standaert, Ray Stewart and Bart Van Den Meersche have a contractual termination
clause with an indemnity of 1 year’s remuneration.
Michel Georgis has a contractual termination clause with an
indemnity of 1 year’s remuneration plus 1 month pay per year of
seniority acquired, with a maximum of two years’ remuneration
after 12 years of service.
67
Basic remuneration
Short-term variable remuneration
Long-term share-based variable remuneration
Long-Term Performance Value based variable remuneration
Retirement and post-employment benefits
Other benefits
TOTAL (excl. employer’s social contribution)
Employer’s social contribution
TOTAL (incl. employer’s social contribution)
Former President & CEO
MARKET
CORPORATE
CONTEXT
GOVERNANCE
Remuneration
GENERAL
INFORMATION
Corporate name and legal form
For further information
The autonomous public-sector company Belgacom is a Société
anonyme de droit public/Naamloze vennootschap van publiek recht
(limited liability company under public law) as defined by the Law of
21 March 1991 on the reform of certain public-sector commercial
undertakings and organized under the laws of Belgium.
Dirk Lybaert
Executive Vice President Corporate Affairs
Bd. du Roi Albert II/Koning Albert II-laan, 27
B - 1030 Brussels
Tel: +32 2 202 16 48
E-Mail: [email protected]
The Company is subject to the statutory and regulatory provisions
of commercial law applicable to companies limited by shares in
all matters not expressly determined by (or by virtue of) the Law of
21 March 1991 or specific legislation of any kind.
INFORMATIONS GÉNÉRALES
Registered Office
68
Belgacom SA under public law
Bd. du Roi Albert II 27
B - 1030 Brussels
VAT BE 0202.239.951
Brussels Register of Legal Entities
Consultation of the issuer’s documents
The public documents concerning the issuer can be consulted at
the registered office.
Date of constitution
The company was established as an autonomous public sector
company, governed by the Law of 19 July 1930 setting up the Belgian National Telephone and Telegraph Company, the RTT (Régie
des Téléphones et Télégraphes/Regie van Telegraaf en -Telefoon).
The transformation of Belgacom into a SA of public law was
implemented by the Royal Decree of 16 December 1994,
which was published in the Belgian Official Gazette on
22 December 1994, and went into effect on the same day.
Objectives of the Company
As described in Article 3 of the Articles of Association, the Company’s objects are:
1. to develop services within the field of telecommunications in
Belgium or elsewhere;
2. to take all actions aimed at promoting, directly or indirectly, its
activities or ensuring optimal use of its infrastructure;
3. to acquire participating interests in bodies, companies or associations – whether existing or to be created, Belgian, foreign or
international, and public or private sector – that may contribute,
directly or indirectly, to the achievement of its corporate objects;
4. to provide radio and television broadcasting services.
Disclaimer
This communication contains forward-looking statements, including
statements about the Company’s beliefs and expectations. These
statements are based on the Company’s current plans, estimates
and projections, as well as its expectations of external conditions and
events. Forward-looking statements involve inherent risks and uncertainties and speak only as of the date they are made. The Company
undertakes no duty to and will not necessarily update any of them in
light of new information or future events, except to the extent required
by Belgian law. The Company cautions investors that a number of
important factors could cause actual results or outcomes to differ
materially from those expressed in any forward-looking statements.
For CSR information
Xavier Dekeuleneer
Head of Corporate Social Responsibility
Bd. du Roi Albert II/Koning Albert II-laan 27
B - 1030 Brussels
Tel: +32 2 202 93 67
For financial information
Nancy Goossens
Vice President Investor Relations
B - 1030 Brussels
Tel: +32 2 202 82 41
Fax: +32 2 201 54 94
Our report is printed on Satimat Green coated
paper, made out of 60% recycled fibers, 40% FSC
virgin fibers. Vegetable-based ink and non-solvent
adhesives are used. The printing plates and
ink recipients are recycled. The waste paper is
collected and then compressed and recycled by
authorised bodies. The printer is FSC and PEFC
certified.
Editor-in-chief:
Dirk Lybaert
Executive Vice President Corporate Affairs
B - 1030 Bruxelles
Conception and coordination:
Anne-Françoise Streel
Corporate Communication Project Manager
Design and prepress:
Chris Communications
www.chriscom.be
Printing: Snel
Pictures:
Jean-Michel Byl, Getty images, Istock and
Belgacom
Visit Belgacom’s website:
www.belgacom.com
Belgacom’s annual report is also published in
Dutch and in French.
DISCOVER THE ONLINE VERSION OF THIS
ANNUAL REPORT AT
HTTP://ANNUALREPORT.BELGACOM.COM

activity report 2013

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