Royal KPN N.V. — Call Transcript 2016

Nov 11, 2016

Analyst round table session

Topic: Improving quality, reducing spend

Jan Kees de Jager, CFO 11 November 2016

Strong progress in reducing spend levels1

¹ All figures based on continuing operations, unless stated otherwise Analyst round table | Overview spend reduction | ² The presented categories show adjusted numbers and differ from the opex breakdown as presented in KPN's Integrated Annual Report 2015

Reduced personnel expenses in all layers of the organization

Quality programs in customer service driving down personnel expenses

Improving customer experience while rationalizing IT

Combining traditional and disruptive approaches in Simplification program

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A complete overhaul of our fixed and mobile IT landscape

Leading to significant benefits for customers and organization

6Analyst round table | IT / TI expenses |

Lower marketing, billing and housing expenses

Driven by increased loyalty, improved processes and less floor space

Lower housing expenses driven by store transformation and office rationalization

• Focus on online customer sales & service
• ~33% stores closed since 2014; ~25% cost reduction
• New Experience Centers in larger shopping areas

2 Related to Billing & Collection, Q3 '16 annualized compared to 2012

¹ Annualized gross churn KPN brand 7 Analyst round table | Other operating expenses |

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Summary

Business

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