2Q 2001 Results Presentation. August 9, 2001

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2Q 2001 Results Presentation

August 9, 2001

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Media

Media TelcoTelco B2BB2B

Financial and Operational Highlights

Core Business Details

Guidance for FY2001

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MediaMediaMedia TelcoTelcoTelcoTelco B2BB2BB2BB2B

FINANCIAL HIGHLIGHTS

ü

ü 1H 2001 consolidated revenues of € 57.0 mln, up from € 37.8 mln 1H 2001 consolidated revenues of € 57.0 mln, up from € 37.8 mln in in 2H 2000 and € 4.6 mln in 1H 2000

2H 2000 and € 4.6 mln in 1H 2000

ü

ü 2Q 2001 revenues for FastWeb of € 11.3 mln, an increase of 64% 2Q 2001 revenues for FastWeb of € 11.3 mln, an increase of 64% from 1Q 2001 and over 240% compared to the same period last year

from 1Q 2001 and over 240% compared to the same period last year

ü

ü FastWeb’s gross margin stands at 70% of revenues, maintaining itFastWeb’s gross margin stands at 70% of revenues, maintaining its s position as one of the highest in the sector

position as one of the highest in the sector

ü

ü HanseNet’s gross profit grows to € 7.3 mln (up from € 5.6 mln inHanseNet’s gross profit grows to € 7.3 mln (up from € 5.6 mln in 1Q 1Q 2001 and € 4.4 mln in 4Q 2000) or as a percentage of revenues to

2001 and € 4.4 mln in 4Q 2000) or as a percentage of revenues to

47.6% (up from 33.5% in 1Q 2001 and 26.1% in 4Q 2000)

ü

ü Consolidated capital expenditures in 2Q amounted to € 108.5 mlnConsolidated capital expenditures in 2Q amounted to € 108.5 mln

ü

ü e.Biscom has € 1,129 mln in cash & equivalents as of June 30, 20e.Biscom has € 1,129 mln in cash & equivalents as of June 30, 200101

ü

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Media TelcoTelcoTelcoTelco B2BB2B

OPERATIONAL HIGHLIGHTS

ü

ü Total network in Italy and Germany reaches 5,600 Km, of which Total network in Italy and Germany reaches 5,600 Km, of which 3,400 Km are local access (network reach in Milan: 100% of

3,400 Km are local access (network reach in Milan: 100% of

corporate market and > 25% of homes and SOHOs)

ü

ü FastWeb customer base grew over 70% to 14,500 (of which 3,500 FastWeb customer base grew over 70% to 14,500 (of which 3,500 corporate and SOHO and 11,000 residential clients)

corporate and SOHO and 11,000 residential clients)

ü

ü FastWeb activated its services in Genoa and Turin and signed up FastWeb activated its services in Genoa and Turin and signed up its first cutomers in Rome; market penetration in first areas in

its first cutomers in Rome; market penetration in first areas in

downtown Milan at 20%

ü

ü FastWeb’s monthly revenues in June were more than double of FastWeb’s monthly revenues in June were more than double of January’s monthly revenues

January’s monthly revenues

ü

ü HanseNet customer base grew over 40% to nearly 24,000 (of which:HanseNet customer base grew over 40% to nearly 24,000 (of which: 6,400 businesses, 17,500 residential clients and 35 carriers)

6,400 businesses, 17,500 residential clients and 35 carriers)

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MediaMediaMedia TelcoTelco B2BB2BB2BB2B

OPERATIONAL HIGHLIGHTS

Media & B2C

ü

ü Video on Demand is now fully operational: customers can Video on Demand is now fully operational: customers can already enjoy nearly 1,000 titles from Universal, Discovery

already enjoy nearly 1,000 titles from Universal, Discovery

Networks, RAIClick (the JV with the Italian national broadcaster

Networks, RAIClick (the JV with the Italian national broadcaster) )

and several Italian distributors (including Mikado, BIM, Ripley)

ü

ü www.ilnuovo.itwww.ilnuovo.it confirms its position as one of Italy’s leading confirms its position as one of Italy’s leading editorial sites, at 1 mln pageviews/day

editorial sites, at 1 mln pageviews/day

ü

ü AP.Biscom in 2Q 2001, its first fully operational quarter, alreaAP.Biscom in 2Q 2001, its first fully operational quarter, already dy signed up noteworthy clients such as Italy’s largest newspaper

signed up noteworthy clients such as Italy’s largest newspaper

Corriere della Sera, the Italian Chamber of Deputies, Alitalia a

Corriere della Sera, the Italian Chamber of Deputies, Alitalia and nd

Assicurazioni Generali

B2B

ü

ü www.ebixtrade.itwww.ebixtrade.it , B2Biscom’s horizontal marketplace, became , B2Biscom’s horizontal marketplace, became fully operational in 2Q with a current offer of over 20,000

fully operational in 2Q with a current offer of over 20,000

available line items

ü

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DEVELOPMENTS SINCE JUNE 30

ü

ü An agreement was signed giving FastWeb access to An agreement was signed giving FastWeb access to

Telecom Italia’s Socrate network, which permits FastWeb

to reach up to 1.5 million households

ü

ü The contract provides for a right of withdrawal if Telecom The contract provides for a right of withdrawal if Telecom Italia cedes control of Cecchi Gori Communications by

Italia cedes control of Cecchi Gori Communications by

November 2001

Socrate Network

ü

ü FastWeb is granting Omnitel Vodafone a 15FastWeb is granting Omnitel Vodafone a 15--year IRU on year IRU on some fibres in its network

some fibres in its network

ü

ü The agreement covers 2,500 Km (of which 1,600 Km of long The agreement covers 2,500 Km (of which 1,600 Km of long distance and 900 Km of local loops)

distance and 900 Km of local loops)

ü

ü The agreement encompasses 30 of the most important The agreement encompasses 30 of the most important cities in Central and Northern Italy

cities in Central and Northern Italy –– including Milan, Turin, including Milan, Turin, Genoa, Bologna and Rome

Genoa, Bologna and Rome

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Revenues Revenues EBITDA EBITDA EBIT EBIT Net Income* Net Income*

CONSOLIDATED FINANCIALS

Capex in the period** Capex in the period** Cash & equivalents Cash & equivalents

*Net income/loss after minority interests

** These amounts include financial investments and exclude investments made by Metroweb SpA in the corresponding period (€ 22.4 Mln in Q2 2001, € 14.7 Mln in Q1 2001 and € 11.1 Mln in Q2 2000)

29.8 29.8 (31.1) (31.1) (54.9) (54.9) (30.5) (30.5) 1,128.6 1,128.6 175.7 175.7 108.5 108.5 Q2 2001 (€ Mln) 27.2 27.2 (26.6) (26.6) (42.8) (42.8) (30.7) (30.7) 1,177.2 1,177.2 136.8 136.8 68.0 68.0 Q1 2001 (€ Mln)

Total financial debts Total financial debts

3.3 3.3 (4.8) (4.8) (7.6) (7.6) (12.9) (12.9) 1,557.1 1,557.1 0.8 0.8 73.0 73.0 Q2 2000 (€ Mln)

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2Q KEY DATA: OPERATING COMPANIES

FastWeb

* The above-indicated capex figures include tangible and intangible but not financial investments and do not include the capex figures of e.Biscom SpA. Reconciliation with overall consolidated capex for 2Q 2001 is as follows: 72.9 + 23.2 + 1.4 + 7.4 = 104.9 + 1.0 (e.Biscom SpA) = 105.9 + 2.6 (Financial investments) = 108.5 million Euro

Note: for EBITDA and EBIT the differences between the sum of the values shown and the consolidated figures [EBITDA (3.1); EBIT (7.8)] are attributable to e.Biscom SpA as well as to goodwill arising on consolidation

Gross revenues

Intra

Intra--groupgroup

EBITDA EBITDA EBIT EBIT Capex * Capex * HanseNet

B2Biscom B2C and Media

11.3 11.3 0.7 0.7 (10.0) (10.0) (20.1) (20.1) 72.9 72.9 Gross revenues Gross revenues Intra

EBITDA EBITDA EBIT EBIT Capex * Capex * 15.4 15.4 ----(6.2) (6.2) (11.3) (11.3) 23.2 23.2 Gross revenues Gross revenues Intra

EBITDA EBITDA EBIT EBIT Capex * Capex * 1.5 1.5 ----(2.6) (2.6) (4.2) (4.2) 1.4 1.4 Gross revenues Gross revenues Intra

EBITDA EBITDA EBIT EBIT Capex * Capex * 2.3 2.3 0.2 0.2 (9.2) (9.2) (11.5) (11.5) 7.4 7.4

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Financial and Operational Highlights

Core Business Details

Guidance for FY2001

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FastWeb’s integrated IP network FastWeb Customer Customer segments segments Services Services Businesses Businesses Residentials Residentials Voice

Voice VideoVideo

Different networks used by... Data / Data / Internet Internet Network 2 Incumbents Network 3 Network 1 Network 2 Cable TVs Network 1

FASTWEB’S IP NETWORK

CLECs Network 1

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FASTWEB’S REVENUE AND ARPU

BREAKDOWN

TelcoTelco

6.9 6.9 11.3 11.3

Corporate sales

consistently produce

the bulk of FastWeb’s

revenues

+ 64%

Top & Medium

Small Small SOHOs SOHOs Residentials Residentials

ARPUs (Eur / year)

100,000 100,000 6,500 6,500 1,700 1,700 700 700

* Corporate sales include revenues from other companies in the e.Biscom group

0 2 4 6 8 10 12 1Q 2001 2Q 2001 EUR Million

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CORPORATE CUSTOMERS:

PRODUCT PORTFOLIO

—

— INCLUSIVE SERVICE: INCLUSIVE SERVICE: BroadBandBroadBand access access

service for voice, video, data & Internet

connectivity, an IP Access for:

•

• Voice (ISDN PRI, ISDN BRI; POTS) Voice (ISDN PRI, ISDN BRI; POTS)

•

• Internet >10MbpsInternet >10Mbps

•

• IPIP--VPN >10MbpsVPN >10Mbps

•

• Extended LAN Server Farm AccessExtended LAN Server Farm Access

—

— MULTISITE CLIENT: Broadband bundle of MULTISITE CLIENT: Broadband bundle of

data, Internet, voice connectivity and Housing,

through an entry service of IP

through an entry service of IP--VPNVPN

—

— SDH capacity for Telco Operators & CarriersSDH capacity for Telco Operators & Carriers

—

— Dark Fiber leaseDark Fiber lease

—

— Local loop & long distance provisioning Local loop & long distance provisioning

(Carrier to Carrier, Carrier to ISP, Carrier to

Top/Medium customers)

—

— Monthly recurrent charge according to Monthly recurrent charge according to

distance range

—

— Two weeks lead time for on net sitesTwo weeks lead time for on net sites

—

— Voice/Video (A/V telephony among Voice/Video (A/V telephony among

employees)

—

— Intranet/Data (VPN IP MPLS @ 10Mbps)Intranet/Data (VPN IP MPLS @ 10Mbps)

—

— EE--learning (distance learning with live learning (distance learning with live

audio/video/slide show; lessons on demand)

—

— Business TV (Top Management A/V Business TV (Top Management A/V

broadcasting)

—

— VideoConferencing (High quality Multivideo VideoConferencing (High quality Multivideo

conferencing)

—

— ISP services of full service Hosting, Web ISP services of full service Hosting, Web

development & E

development & E--commercecommerce

—

— Broadband Video Streaming for live events, Broadband Video Streaming for live events,

TV On PC and A/V Interactivity

—

— Broadband Managed Housing up to 100 Broadband Managed Housing up to 100

Mbits connectivity + Bandwidth on Demand

—

— Server Farm directly peering international & Server Farm directly peering international &

national carriers (1,000 + 5,000 sqm)

national carriers (1,000 + 5,000 sqm) Corporate services

Carriers

B2E (Business to Employee telework)

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CORPORATE AND RESIDENTIAL

CUSTOMERS: KEY DATA

Selected corporate customers Highlights

Telco

ü

ü 100% of Top, Medium and Small 100% of Top, Medium and Small companies in Milan addressed companies in Milan addressed

ü

ü Over 40 IP VPN customersOver 40 IP VPN customers

ü

ü Market share at 20% in first areas Market share at 20% in first areas served

served

Corporate clients Residential clients

+ 53% + 71% 22 149 324 1.520 29 224 537 2.695 0 500 1.000 1.500 2.000 2.500 3.000

Carriers Top & Medium Small SOHOs

1Q 2001 (EoP) 2Q 2001 (EoP) 4.200 6.439 11.042 2.000 4.000 6.000 8.000 10.000 12.000 4Q 2000 1Q 2001 2Q 2001

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ITALIAN NETWORK ROLL-OUT

Telco

Buildings reached Households addressed

2,925 2,925 3,386 3,386 3,791 3,791

Network roll

Network roll-

-out

out

and reach are well

on target

Available infrastructure 1.661 1.943 2.165 1.264 1.443 1.626 1.000 1.500 2.000 2.500 3.000 3.500 4.000 4Q 2000 1Q 2001 2Q 2001 Km

Long distance Local access

5.500 5.967 11.686 2.000 4.000 6.000 8.000 10.000 12.000 4Q 2000 1Q 2001 2Q 2001 70.000 116.442 144.908 20.000 50.000 80.000 110.000 140.000 170.000 4Q 2000 1Q 2001 2Q 2001

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FULLY FUNDED PLAN (MODULE “1”)

Telco

Residential SoHo Small Business

Top & Medium Business Carriers 6,000 27,000 300,000 3,100,000 Addressable Mkt @ 2010 Market share @ 2010 ü ü RevenuesRevenues ü

ü Cumul. CapexCumul. Capex

ü

ü EBITDA marginEBITDA margin

Data @ 2010

ü

ü Peak financial Peak financial

ü

ü EBITDA breakeven EBITDA breakeven

ü

ü Max leverageMax leverage

25% 24% 22% 26% € 900 mln € 900 mln € 1.8 bln € 1.8 bln > 55% > 55% € 1.5 bln € 1.5 bln 2003 2003 1x 1x 1,500 6,500 65,000 800,000 Customers @ 2010

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HANSENET: CUSTOMERS GROWTH

Telco Telco 11,800 11,800 16,800 16,800 23,951 23,951

Relatively stable

during the first 3

quarters of the year

2000...

... the number of

HanseNet customers

has grown steadily

since e.Biscom took

over

Customers: 2001 vs 2000 Customers: Q on Q evolution 10.100 10.300 10.500 11.800 16.800 23.951 0 5.000 10.000 15.000 20.000 25.000

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter

2000 2001 0 5.000 10.000 15.000 20.000 25.000 4Q 2000 1Q 2001 2Q 2001 Corporate & SOHOs Residentials

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REVENUE MIX EVOLUTION

Telco

ü

ü Steady increase in Steady increase in core revenues... core revenues... ü ü Favourable Favourable evolution of evolution of revenue mix... revenue mix...

... lead to significant

improvement in

gross margin

Revenues

Gross margins (as a % of revenues)

2 2 , 0 % 2 6 , 1 % 3 3 , 5 % 4 7 , 6 % 0 , 0 % 1 0 , 0 % 2 0 , 0 % 3 0 , 0 % 4 0 , 0 % 5 0 , 0 % 3 Q 2 0 0 0 4 Q 2 0 0 0 1 Q 2 0 0 1 2 Q 2 0 0 1 0 2 4 6 8 10 12 14 16 18 3Q 2000 4Q 2000 1Q 2001 2Q 2001 EUR Million Non-core Core

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Financial and Operational Highlights

Core Business Details

Guidance for FY2001

AGENDA

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STRATEGIC HIGHLIGHTS

ü

ü Focus on core telecom Focus on core telecom business and lower non

business and lower non-

-core spending

core spending

ü

ü Consolidate technological Consolidate technological leadership to be ready for