BERTELSMANN ANNUAL RESULTS 2012

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1 BERTELSMANN ANNUAL RESULTS Investor Conference Call March 26, 2013 Judith Hartmann Member of the Executive Board and Chief Financial Officer of Bertelsmann

2 Summary and highlights Financial Year 1 Solid business performance Revenues up 4.5%, organic growth 3.1% Solid operating EBIT Group profit slightly up despite high special items EBITDA margin 13.8%, ROS10.8% 2 Solid financial position In line with all financial targets Comfortable liquidity position, maturity profile extended Target rating Baa1/BBB+ with stable outlook 3 Group strategy Strengthen media and service businesses Digital transformation Growth platforms and growth regions Page 2

3 Group key figures Solid business performance, revenue up 4.5%, group profit up 1% Continuing operations, in millions Revenues (in billions) Operating EBITDA Operating EBIT Group profit Reported +4.5% Organic +3.1% , % 2,213 ROS 11.4% 10.8% -1.1% +1.1% 1,755 1, Solid organic growth Record results at Random House and Mediengruppe RTL Deutschland Great traction at Arvato, in particular Infoscore Weak advertising markets in Southern/Western Europe and negative effects of structurally declining businesses Budgeted start-up losses resulting from digitization and new businesses Page 3

4 Divisions Record earnings at Random House, solid revenue growth at RTL Group and Arvato Continuing operations Organic growth +3.3% +15.7% -3.9% +3.9% -2.3% Revenues (in billions) 1,121 1, (-5%) Operating EBIT (in millions) (+76%) (-28%) (-10%) 60 (-17%) ROS RTL Group Random House Gruner + Jahr Arvato Be Printers 19% 18% 11% 15% 10% 8% 6% 5% 6% 5% Page 4

5 Income statement Group profit slightly above previous year Change in millions in % abs. Remarks Operating EBIT 1,755 1,735-1% -20 Special items Declining businesses (217M), Southern Europe (95M), G+J business media publishing division (47M); low capital gains EBIT 1,433 1,330-7% -103 Financial result Income tax Lower earnings share in partnerships held by non-controlling interests High non-tax-deductible expenses Earnings after taxes from discontinued operations : Sale Direct Group France Group profit % +7 Page 5

6 Group key figures Diverse revenue base across sources and regions Revenue share, continuing operations Revenue sources in (previous year) Regions in (previous year) Rights and licenses Services 18.2% 22.9% (16.6%) (22.2%) 11.2% 8.7% (9.9%) (8.5%) Products and merchandise 27.0% 39.8% (28.6%) (39.7%) US Other countries 16.3% (14.2%) 6.9% (5.7%) 36.1% (36.6%) Germany 26.1% (28.2%) Advertising Rest of Europe 24.9% (26.4%) 15.8% (17.1%) France Page 6

7 Performance Indicator Cash generative business reflected in high Cash Conversion Rate, slight increase in BVA Cash Conversion Rate in percent Target percent RTL Group Random House Gruner + Be Jahr Arvato Printers Total Group BVA in millions ) ) Since FY the goodwill for RTL Group at group level previously carried under Corporate (Corporate Investments) has been allocated to RTL Group. Page 7

Financial status All targets met, pension obligations increased by 413m due to lower discount rates Leverage Factor < 2.5x Economic debt (in millions) 3.2x 3.2x 2.3x 2.4x 2.

8 Financial status All targets met, pension obligations increased by 413m due to lower discount rates Leverage Factor < 2.5x Economic debt (in millions) 3.2x 3.2x 2.3x 2.4x 2.3x 6,627 6, Interest Coverage Ratio > 4.0x 4.7x 5.2x 4.4x 4.1x 6.5x Net debt PPC Operating Leases 3,445 4,915 4,913 2,793 1,913 1, ,067 1,119 1, ,778 1, Pensions 1,409 1,406 1,565 1,738 2, Equity Ratio > 25% % 31% 35% 34% 32% Baa1, outlook: stable BBB+, outlook: stable Page 8

9 Financial Status Maturity profile extended, short-term maturities require no refinancing 2,658 Maturity profile (capital market financing) in millions Liquidity Financing Activities in FY 100m Private Placement, 3.700%, tenure 20yrs 750m Benchmark Bond, 2.625%, tenure 10yrs Bonds Promissory notes US PP 1, ,000 Syndicated loan 12/31/ Page 9

10 Group strategy Transformation of Bertelsmann portfolio Target portfolio Higher growth More digital More international Strategic priorities Strengthening the core Digital transformation Growth platforms Growth regions Page 10

11 Group strategy Significant progress in implementing strategic priorities 1 Strengthening the core RTL: Launch of new digital TV-channels RTL Nitro and 6ter Random House: Merger with Penguin Books G+J: Revitalization of core brands Be Printers: Creation of a separate print unit 2 Digital transformation RTL: Expansion of non-linear / next Gen TV Random House: Growth of e-book business G+J: New strategy adopted, expansion of digital advertising sales 3 Growth platforms BMG: more than 1 million copyrights, organic growth and acquisitions Education: Fund University Ventures I Arvato: Expansion of growth platforms 4 Growth regions Investments: Via Bertelsmann investment funds RTL: Launch of BIG-RTL Thrill in India Page 11

12 Summary and outlook Financial Year ROS in double-digit range expected for 2013 despite low visibility 2 Business performance provides tailwind for long-term strategic transformation of the Group 3 Considerable progress in implementing strategy 4 Clear investment priorities 5 Development of new growth areas: content rights, education, and business information Page 12

13 Q&A-SESSION Investor Conference Call March 26, 2013 Judith Hartmann Member of the Executive Board and Chief Financial Officer of Bertelsmann

Bertelsmann Interim Results 2016

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