Milan, March 19 th FY Financial Results

Transcription

1 Milan, March 19 th FY Financial Results

2 Agenda RCS MediaGroup Today 2003 Highlights 2003 Financial Results Business Units Outlook

3 RCS MediaGroup - Today 20% Market share in terms of copies and readers SECOND SPANISH DAILY NEWSPAPER NEWSPAPERS LEADER DAILY & SPORT NEWSPAPERS MAGAZINES 21 % SECOND IN THE MARKET WITH STRONG LEADERSHIPS IN MAIN SEGMENTS 14,2% Market share in ITALY Market share BOOKS 4,1% Market share in FRANCE BROADCAST 25% Market share DISTRIBUTION LEADER ON DISTRIBUTION TO NEWS-STANDS ADVERTISING LEADER PRESS ADV. AGENCY 18,3% Market share 3

4 Net Sales Breakdown Consolidated Revenues: 2.236,9 mln Euro by Business Units by Sector Books 31% Broadcast 1% Newspapers 42% Books 31% Broadcast 1% Circulation Newspapers 23% Circulation Magazines Advertising* 5% Distribution** 2% Magazines 19% Advertising 35 % 8% Distribution 2% * Outdoor and third parties ** Third parties only 4

5 2003 Highlights Corporate activities 1/2 RENAMING: H.d.p. RCS MediaGroup NEW ORGANISATIONAL STRUCTURE (from 1/1/2004) FILA: DISPOSAL TO CERBERUS INCREASE IN UNEDISA STAKE: 54,1% 89,1% (today ~ 95%) INCORPORATION OF LEADER IN DISTRIBUTION (JV with DeAgostini e Hachette Rusconi) 5

6 2003 Highlights Corporate activities 2/2 SELLING 10% OF RCS Periodici TO BURDA INCREASE IN Immobiliare Solferino 28 STAKES: 51% 100% CORPORATE SIMPLIFICATION: MERGE IN RCS libri (EFFECTIVENESS 1/1/03) MERGE IN RCS broadcast (EFFECTIVENESS 1/1/04) REDUCTION OF N. 30 COMPANIES SUBSCRIPTION OF PIRELLI CAPITAL INCREASE DIVESTMENT OF JOSEPH ABBOUD GROUP (DEFINITIVE AGREEMENT SIGNED IN FEBRUARY 2004) 6

7 2003 Highlights Key Facts NEW EDITORIAL PROJECT START-UP: FULL COLOUR Corriere della Sera UNEDISA IMMEDIATE RECOVERY IN PROFITABILITY DEVELOPMENT OF ADD-ONS INCREASE INITIATIVES: CIRCULATION REVENUES CORPORATE REORGANIZATION OF BUSINESS UNITS AND COST REDUCTION PROFIT AND CASH GENERATION IMPROVEMENT 7

8 2003 Highlights Financials RCS DELIVERED SOLID AND ABOVE-FORECAST RESULTS: SALES INCREASED BY 1,0% 2,0% Like for Like Growth EBIT INCREASED BY 42% UP TO 86,1 mln Euro NET PROFIT OF 46,1mln Euro COMPARED TO 2002 LOSS TAX RATE DOWN TO 29,1% (including tax credit) DIVIDENDS PROPOSAL* : - ordinaries shares: 4 cents + 3 cents (extraordinary) - savings shares: 6 cents + 3 cents (extraordinary) + 5 cents (x2) * To be approved by AGM, 28/29th April

9 FY2003 Results Summary mln Euro YoY Circulation Advertising GFT/FILA 1.427,9 804,9 4, ,2 754,9 134, % + 6.6% n.a. TOTAL REVENUES 2.236, , % Gross Oper. Profit % on sales 183,8 8.2% 158,5 7.2% +15.9% +100 bps EBITDA % on sales 157,3 7.0% 129,3 5.8% +21.7% +120 bps EBITA % on sales 116,7 5.2% 86,8 3.9% +34.4% +130 bps EBIT % on sales 86,1 3,8% 60,8 2,7% +41.6% +110 bps NET PROFIT % on sales 46,1 2.1% (152,3) n.a. n.a. 9

10 Consolidated P&L (Like for like)* mln Euro YoY TOTAL REVENUES Goods and service costs Labour costs Gross Oper. Profit % on sales D & A EBIT % on sales 2.232, ,3 + 1,9% (1.643,8) (1.631,0) (400,1) (397,0) 188,8 162,3 +16,3% 8,5% 7,4% (97,2) (99,6) 91,6 62,7 +46,2% 4,1% 2,9% *Unedisa at 100% for all periods and excluding GFT and Fila Holding 10

11 Revenues Analysis - Business Units and Country mln Euro ITALY ABROAD TOTAL Newspaper 634,9 257,7 892,6 Magazines 301,3 90,8 392,1 Books 312,6 324,5 637,1 Advertising 621,2 621,2 Broadcast 26,7 26,7 Miscellaneous & Adjust <332,8> <332,8> TOTAL 1.563,9 673, ,9 % on total 70.0% 30.0% 100% 11

12 Revenues Analysis - Business Units vs 2002 mln Euro Newspapers Italy 634,9 Advertising 621,2 Books 637,1 Unedisa 257,7 Magazines Italy 301,3 Magazines Intern. Broadcast 90,8 26,7 vs. 2002: +35,3 +15,9 +2,9-0,6 +43,9-21,3 +3,4 of which adv. - 10,5 +3,5-0,2-3,6 n.s. 12

13 EBITA Margin - Business Units and Country ALL DIVISIONAL PROFITABILITY ABOVE 2003 BP TARGETS mln Euro ITALY ABROAD TOTAL Actual B.P. Actual B.P. Actual B.P. Newspaper 12,0% 10,6% 5,2% 3,2% 9,6% Magazines 7,2% 6,5% 0,4% - 2,1% 5,6% Books 9,7% 4,8% 7,0% 6,7% Advertising 1,0% 1,0% 0,6% Broadcast -4,9% - 4,9% -20,0% TOTAL EBITA% 5,7% 4,1% 5,2% 4,1% 13

14 EBITA Margin Actual vs BP Target 20% BP Target 2003 Actual 2003 Size of revenues 15% 11,9% 12,0% 10% 10,6% 6,5% 7,2% 6,7% 7,0% 5,2% Cons. Actual % 5,2% 0% 3,2% 0,4% 4,1% BP Cons. Target % -2,1% -4,9% -10% Newspapers Magazines Books -20,0% Radio Italy Spain Italy Intern. 14

15 Headcount reduction vs 2002 Punctual data as of 31/12/03 * Delta vs 2002 excluding Distribution = International Magazines - 63 Others companies * Distribution employees Note: All Consolidated companies 15

16 Sound Financial Structure mln Euro Total fixed assets Net Working Capital (Fund & Others) 1.105,0 447,2 (194,7) 1.053,1 431,1 (265,0) CAPITAL EMPLOYED 1.357, ,2 Net financial debt Employee Termination Indemnity Equity 191,6 109, ,5 83,1 111, ,7 EQUITY& NFD 1,357,5 1,219,2 Gearing ratio = 18.1% 16

17 Net Financial Position mln Euro 2003 Net Financial Position 1/1 (83,1) Net Operating Profit D&A NWC Funds Investments Dividend Others (Financials, Taxes, Extraord ) 86,1 71,2 (16,1) (19,9) (154,1) (7,0) (68,7) INVESTMENTS DETAILS 35% UNEDISA 93,3 Capital Increase Pirelli 57,3 Printing presses 10,0 Catherine Nemo 8,0 Cash Flow (108,5) Net Financial Position 31/12 (191,6) 17

18 Operating Cash Flow mln Euro 2003 EBIT Depreciation & Amortization Net Working Capital* Taxes 86,1 71,2 (13,5) (22,3) Operating Cash Flow 121,5 * NWC: Trade receivables and payables, Inventories 18

19 Newspapers Italy P&L Circ avg. daily copies Read per day Circ avg. daily copies Read per day ADD-ONS ADS and Audipress autumn 2003 mln Euro 2003 % 2002* % YoY Circulation Advertising 366,0 268,9 57.6% 42.4% 320,2 279,4 53.4% 46.6% +14.3% - 3.8% TOTAL REVENUES 634,9 100% 599,6 100% + 5.9% EBITA * 75,9 12.0% 74,2 12.3% + 2.3% EBIT 75,9 12.0% 74,2 12.3% + 2.3% ROI >100% >100% * RCS calculation based on 2002 Financial Reports 19

20 Corriere della Sera Brand Extension 2003 actual data ADD-ONS MAGAZINES/SUPPLEMENTS ART BOOKS avg. copies 17 issues/30 ECONOMY REAL ESTATE CORRIERE ECONOMIA TROVO CASA STORIA D ITALIA avg. copies 7 issues/14 LEISURE&ENTERT. RECRUITMENT VIVI MILANO/ROMA CORRIERE LAVORO NOVELS avg. copies 50 issues/50 HEALTH FEMALE : CIRC avg. copies CORRIERE SALUTE VHS MOVIES avg. copies 85 iussues/85 TV/NEWS : CIRC avg. copies 20

21 Gazzetta dello Sport Brand Extension 2003 actual data ADD-ONS MAGAZINES Milan coins avg. pieces 30 issues SPORT WEEK avg. copies EVENTS Ferrari Models avg. copies 5 issues/40 CYCLING MARATHON BEACH VOLLEY SNOW BOARD 21

22 Newspapers Spain P&L Circ avg. daily copies Read per day ADD ONS mln Euro 2003 % 2002* % YoY Circulation Advertising 157,2 100,5 61.0% 39.0% 144,9 94,6 60.5% 39.5% +8.5% +4.0% TOTAL REVENUES 257,7 100% 239,5 100% + 7.6% EBITA 13,3 5.2% (2,0) (0.8%) bps EBIT 13,3 5.2% (2,2) (0.9%) bps ROI 11.7% < 0% * Proforma data - Unedisa 100% 22

23 EL MUNDO Brand Extension ADD-ONS MAGAZINES/SUPPLEMENTS DVD MOVIES ECONOMY AUTOMOTIVE RECRUITMENT NATIONALGEOGRAPHIC HEALTH 23

24 RCS Periodici - Magazines LEADER IN THE FOLLOWING SECTOR: Source: circulation 2003 actual MKT Share% WOMEN Weekly Circ Weekly Circ Monthly Circ % FAMILY Weekly Circ Weekly Circ Weekly Circ % FURNITURES Monthly Circ Monthly Circ % ECONOMY Weekly Circ % 3 Monthly Titles Circ INFANCY 70% ITALY 2 LARGEST PUBLISHER 24

25 Magazines Italy P&L (60%) DARP (50%) (100%) 7 weekly 23 monthly mln Euro 2003 % 2002 % YoY Circulation Advertising Others 127,5 153,7 20,1 42.3% 51.0% 6.7% 125,0 153,9 19,5 41.9% 51.6% 6.5% + 2.0% % TOTAL REVENUES 301,3 100% 298,4 100% + 1.0% EBITA 21,6 7.2% 21,0 7.0% + 2.9% EBIT 13,6 4.5% 13,0 4.4% + 4.6% ROI* 42,2% 40,0% * Excluding goodwill of titles 25

26 Magazines International P&L Verlags Milchstrasse MAX Verlag (50%) (75%) mln Euro 2003 % 2002 % YoY Circulation 33,6 37.0% 33,7 36.9% -0.3% Advertising 49,5 54.5% 53,1 58.1% -6.7% Others 7,7 8.5% % 67.4% TOTAL REVENUES 90,8 100% 91,4 100% -0.7% EBITA 0,4 0.4 % % EBIT 0,4 0.4 % % 26

27 ADD-ONS ITALY Volumes = 19,5 mln of Books, 12 mln VHS/DVD, 1,5 mln Musical CD mln Euro 2003 % 2002 % YoY Add-ons Newspapers Add-ons Magazines 110,8 16,8 86.9% 13.1% 57,8 11,1 83.8% 16.2% % % TOTAL REVENUES 127,6 100% 68,9 100% % EBIT 36,8 28.8% 14,3 20.8% > 150% 27

28 Italy Advertising Trend MARKET RCS % YoY TV + 12,4% -3,8% +0,5% + 4,9% n.a. RCS Newsp. ADV. Breakdown: Newspapers National Newspapers Local -11,3% -5,9% +0,1% + 5,9% -4,8% + 14,5% National = 85% Local & Free =15% Magazines + 11,8% +4,3% -8,0% + 1,0% +0,2% Radio + 15,8% -11,0% -9,0% + 15,9% n.a. - Private + 24,0% +26,0% Outdoor + 14,9% -1,8% -8,0% + 3,2% + 17,6% TOTAL + 13,0% -3,4% -3,3% +3,3% Source: AC Nielsen/FCP 28

29 Advertising IGPDECAUX (67,7%) (51%) Rcs Dada Avertising (50%) mln Euro 2003 % 2002 % YoY Adv. House 490,9 79.1% 457,4 79.2% + 7.3% Outdoor Adv. 101,5 16.3% 86,3 15.0% % International Adv. 27,3 4.4% 33,6 5.8% -18.7% Web Adv. 1,5 0.2% - - n.a. TOTAL REVENUES 621,2 100% 577,3 100% + 7.6% 29

30 Books BOOKS ITALY BOOKS FRANCE PARTWORKS EDUCATIONAL 1 NOVELS, ILLUSTRATED, etc.. Books Publisher in Italy 2 FLAMMARION ITALY 4 Books 2 Publisher in France Player in Italy INTERNATIONAL France, UK 14,2% mkt share* 4% mkt share 34.8% mkt share** 1 Italian Publisher in Europe * In terms of copies ** In terms of value 30

31 Books P&L mln Euro 2003 % 2002 % YoY ITALY 312,6 49.0% 293,9 44.6% + 6.3% ABROAD 324,5 51.0% 364,5 55.4% -10.9% Educational 92,3 14.5% 99,8 15.2% -7.5% Novels Part works Others 336,3 192,6 15,9 52.8% 30.2% 2.5% 339,6 203,4 15,6 51.6% 30.8% 2.4% -0.9% -5.3% +2.0% TOTAL REVENUES* 637,1 100% 658,4 100% -3.2% EBITA 44,1 7.0% 40,4 6.1% + 9.2% EBIT ROI 31,7 5.0% 27,6 9,2% 7,8% 4.1% % * Excluding rebilling 31

32 Radio P&L RIN Radio Italia Network (acquisition of 2002) Syndication of Local Radio AGR Press Agency mln Euro 2003 % 2002 % YoY Advertising* Others 20,0 6,7 74.9% 25.1% 19,1 4,2 82.0% 18.0% + 4.7% % TOTAL REVENUES 26,7 100% 23,3 100% % EBITA (1,3) -4.9% (7,6) -32.7% EBIT (1,3) -4.9% (7,6) % ROI < 0% < 0% * Revenues not comparable YoY due to adv collection reclassification to Rcs Pubblicità 32

33 Outlook 2004 Big success new add-ons initiatives: - Italy: Corriere della Sera Poetry: avg. copies 4 issues/30 DVD Movies: avg. copies 7 issues/25 Magazine OGGI Musical CD: avg. copies 2 issues/6 DVD Movies: avg. copies 10 issues/10 - Spain: Encyclopedia avg. copies 7 issues/ 24 Corriere della Sera Circulation (Jan/Feb) increased vs 2002 Advertising trend in line with Business Plan expectations Costs savings program on the right track 33

34 Strategic Objectives Concentration on traditional business (Newspapers, Magazines and Books) with focus on improvement of profitability Presence development in Italy, France and Spain Product innovation: new editorial project CS-Full Colour Strengthening the magazine leading titles Investment in the books authors portfolio Further operational efficiency and Group s structure simplification 34

35 BACK UP SLIDES

36 Consolidation Area : main changes UNEDISA: line-by-line consolidation in 2003 (proportional, 54.13%, in 2002) GFT USA: consolidated at net-equity basis in 2003 (line-by-line consolidation in 2002) m-dis: old company (100% owned by Rcs) line-by-line consolidation from January 1st to June 30th; new joint-venture proportional consolidation (45%) from July 1st 36

37 FY2003 Consolidated P&L 1/2 mln Euro YoY TOTAL REVENUES Operating costs Labour costs Gross Oper. Profit Provision EBITDA % on sales D & A EBITA % on sales Goodwill amort. EBIT % on sales 2.236, , % (1.650,2) (1.644,8) (402,9) (410,7) 183,8 158, % (26,5) (29,2) 157,3 129, % 7.0% 5.8% +120 bps (40,6) (42,5) 116,7 86, % 5.2% 3.9% +130 bps (30,6) (26,0) 86,1 60, % 3.8% 2.7% +110 bps 37

38 FY2003 Consolidated P&L 2/2 mln Euro YoY EBIT 86,1 60, % Financial income (charges) (8,5) (0,7) Earnings from Equity 52,1* (159,0) Earning before Extraord..and Taxes 129,7 (98,9) > 200% Extraordinary Items (53,0) 14,0 EBT 76,7 (84,9) >100% Taxes (22,3) (56,7) %Tax rate 29.1% n.a. Minorities (8,3) (10,7) NET PROFIT 46,1 (152,3) > 100% % on sales 2.1% n.a. * Of which 45,4 mln Euro: partial write-up of Banca Intesa stake 38

39 Corriere della Sera Weekly coverage Monday Tuesday Wednesday Thursday Friday Saturday Sunday SUPPLEMENTS CORRIERE ECONOMIA Economic TROVO CASA VIVI MILANO Real Estate SETTE & TV SETTE CORRIERE LAVORO Recruitment IODONNA Circ avg. copies Female CORRIERE SALUTE ADD-ONS POETRY Avg.Circ.: copies 4/30 issues Price 5,9 Euro Encyclopedia Avg.Circ.: copies 8/30 issues Price 12,9 Euro Art Book Avg.Circ.: copies 26/30 issues Price 5,9 Euro Storia d Italia Avg.Circ.: copies 12/14 issues Price 9,9 Euro DVD Film Avg.Circ.: copies 7/25 issues Price 12,9 Euro 39

40 Gazzetta dello Sport Weekly coverage SUPPLEMENTS/ADD-ONS Monday Momenti di Gloria avg. copies 4/20 issues Price 9.9/6.9 Euro (DVD/VHS) Tuesday Wednesday Thursday Friday Saturday Sunday Modellini Ferrari Avg Circ copies 8/40 issues Price 8.9 Euro SportWeek Avg. Circ copies 40

41 RCS MediaGroup S.p.A. - P&L mln Euro Dividend & tax credit Net financial income TOTAL REVENUES Dep., Am. & write down Operating Expenses EBIT %on sales Net write-down of fin. assets Extraord. Income (charges) PRE-TAX PROFIT %on sales Taxes NET PROFIT 61,5 8,7 10,4 18,0 71,9 26,7 (0,4) (0,8) (20,1) (22,3) 51,5 3,6 71,6% 13,5% 30,9 (195,6) (27,4) (1,1) 54,9 (193,1) 76,2% n.a. 3,4 1,3 51,5 (194,4) 41

42 RCS MediaGroup S.p.A. Balance Sheet mln Euro Non current and fixed assets Net Working Capital Provisions for risk and charges 934,7 94,2 (44,7) ,5 (97,0) NET CAPITAL EMPLOYED 984,2 711,3 Net financial debt Employee Termination Indemnity Equity (145,4) 4, ,6 (246,1) 3,0 954,4 EQUITY& NFD 984,2 711,3 42

43 RCS MediaGroup S.p.A. Cash Flow mln Euro Net Financial Position 1/1 246,1 254,7 EBIT D&A NWC Funds (Investments)/Divest. Dividend Other 51,4 0,4 (19,7) (51,3) (107,5) 41,9 (15,9) (194,4) 196,4 (4,4) 17,9 (22,2) 5,9 (7,8) Cash Flow (100,7) (8,6) Net Financial Position 31/12 145,4 246,1 43

44 Shareholders Structure Shareholders Agreement * 44,793% Free Float 44,407% * Held by 11 Shareholders Expiry date: July 2004 Pre-emption right: 18 months COMPANY % Ownership % Locked FIAT PARTECIPAZIONI 10,508 10,189 MEDIOBANCA 10,302 9,359 GEMINA 9,597 9,188 ITALMOBILIARE 5,754 4,795 Treasury Shares ASS. GENERALI PIRELLI 2,685 1,899 2,537 1,899 3,655% BANCA INTESA 1,989 1,896 Significant Shareholders SINPAR FININT 1,876 1,494 1,876 1,177 7,145% EDISON MITTEL 1,001 0,876 1,001 0,876 Tot. Ordinaries Shares: Tot. Savings Shares: TOTAL 47,982 44,793 44