Q PRESENTATION

Transcription

1 Q PRESENTATION MAY 9, 2018

2 KEYNOTE CONRAD ALBERT CHIEF EXECUTIVE OFFICER

3 OPERATIONAL UPDATE Q NEW GROUP SETUP Implementation started in January 2018 TV RATINGS Robust development TV ADVERTISING Positive development in Q DATA STRATEGY netid foundation established DISTRIBUTION New distribution deals RED ARROW STUDIOS Global sales business strengthened through Gravitas NUCOM GROUP Co-investment and minority buy-outs closed Page 3

4 KEY FINANCIALS IN Q [Q vs. Q1 2017; in EUR m] REVENUES 881-3% 1) ADJUSTED EBITDA % ADJUSTED NET INCOME 93 +6% 1) Portfolio/currency adjusted Group revenue growth positive, reported revenues affected by deconsolidation and adverse currency effects. Page 4

5 IMPLEMENTATION OF NEW GROUP SETUP STARTED ENTERTAINMENT CONTENT PRODUCTION & GLOBAL SALES COMMERCE TV and Digital Entertainment businesses Production: Red Arrow companies Digital studio: Studio71 Global sales: RASI 1), Gravitas Commerce businesses: co-investment of General Atlantic 1) Red Arrow Studios International. Page 5

6 TV CONTINUES TO LEAD IN BOTH REACH AND VIEWING TIME TV REMAINS SUPERIOR MEDIUM FOR MASS REACH VOD LEADING TO OVERALL VIDEO USAGE INCREASE Reach 1) [A 14-69; in %] Viewing time [A 14-69; in min] Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 TV DVD/Blu-ray Free online video Pay VOD Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 TV DVD/Blu-ray Free online video Pay VOD 1) usage at least rarely. Note: rolling last 4 quarters. Source: ViewTime Report 2018, SevenOne Media/forsa. Page 6

7 ONGOING PANEL UPGRADES TO INCLUDE ONLINE USAGE IMPLEMENTED AND PLANNED TV PANEL ADAPTIONS Technical implementation of TV usage via browser: live streaming and catch up H GRADUAL INTEGRATION OF DIGITAL TV SIGNAL Technical implementation of TV usage via apps: live streaming and catch up Integration of browser and app usage in AGF data: live streaming and catch up H H Upcoming 2018 Upcoming 2018 Technical implementation and integration of YouTube usage 1) H Upcoming ) Planned; licensing agreement between AGF and Google/YouTube outstanding. Page 7

8 P7S1 GROUP DELIVERS ROBUST RATINGS DESPITE OLYMPICS AUDIENCE SHARE P7S1 [in %] Q Q (A 14-49) Stable despite Olympics (A 12-49) ) ) (A 15-49) Basis Germany: all German TV households, A 14-49, Mon-Sun, 3-3 h. Source: AGF in cooperation with GfK/TV Scope/ProSiebenSat.1 TV Deutschland. Basis Austria: all Austrian TV households, A 12-49, Mon-Sun, 3-3 h. Source: AGTT/GfK: Fernsehforschung/Evogenius Reporting. Basis Switzerland: German-speaking Switzerland, A incl. guests, Mon-Sun, 2-2 h, overall signal, overnight +7, change in CH measurement system in Source: Mediapulse TV-Panel (Instar Analytics). 1) Pro forma incl. ATV (ATV and ATV2 since April 2017 part of ProSiebenSat.1 PULS4); Q1 2017/2018 ratings without ATV and ATV2: 22.0%/23.0%. Page 8

9 LEADING POSITION IN THE GERMAN TV MARKET EXTENDED Q Q Audience share [A 14-49; in %] +0.2% pts Audience share [A 14-49; in %] +1.1% pts Stable Q1 ratings driven by solid performance of both U.S. licensed content and local commissioned content Basis: all German TV households, A 14-49, Mon-Sun, 3-3 h; w/o RTL II minority. Source: AGF in cooperation with GfK/TV Scope/ProSiebenSat.1 TV Deutschland. Page 9

10 U.S. LICENSED CONTENT CONTINUES TO DELIVER SOLID TV RATINGS EXAMPLES NEW SITCOMS ESTABLISHED SITCOMS U.S. BLOCKBUSTER Warner Bros. Television Warner Bros. Television Up to Up to 2016 Twentieth Century Fox Film Corporation 25.4% 22.3% 15.3% Basis: all German TV households, A 14-49, Mon-Sun, 3-3 h, Q Source: AGF in cooperation with GfK/TV Scope/ProSiebenSat.1 TV Deutschland. Page 10

11 SUCCESSFUL NEW LOCAL COMMISSIONED FORMATS ESTABLISHED EXAMPLES Q UPCOMING DAS DING DES JAHRES MORD MIT ANSAGE LATE NIGHT BERLIN MASTERS OF DANCE ENDLICH FEIERABEND! NEW FORMATS Up to 14.9% Up to 13.4% Up to 12.4% DAS FRÜHSTÜCKSFERNSEHEN GERMANY S NEXT TOPMODEL PROMI BACKEN THE VOICE OF GERMANY GLOBAL GLADIATORS ESTABLISHED FORMATS Up to 20.5% Pic to come Up to 21.5% Up to 12.5% Up to 25.2% Up to 11.1% 1) 1) Best rating since 2012 Best rating since 2013 Best rating since launch 1) FY Basis: all German TV households, A 14-49, Mon-Sun, 3-3 h. Source: AGF in cooperation with GfK/TV Scope/ProSiebenSat.1 TV Deutschland. Page 11

12 TV REMAINS KEY AS ADVERTISERS INCREASE SHARE IN MEDIA MIX INDUSTRY SHARE GROSS SPENDING vs. previous year TV SHARE IN MEDIA MIX vs. previous year GROSS TV AD SPENDING OF TOP 10 TV INDUSTRIES IN GERMANY 1) TOTAL Business Services Food Cosmetics & Toiletries Pharmacy Trade & Shipment Motor Vehicles Finance Telecommunication Beverages Tourism 100% 15% 14% 11% 9% 6% 6% 4% 4% 4% 3% -8% -5% -1% +5% +11% +6% +16% +2% +15% +32% +10% -1.2 ppts -1.6 ppts +1.0 ppts +0.4 ppts +0.5 ppts +3.2 ppts +1.0 ppts +6.9 ppts +6.1 ppts +4.7 ppts +2.7 ppts 1) Basis: Q1 2018/2017; source: Nielsen Media Research. TV industries excl. Media & Publishing and Other Advertising, according to new order of e-commerce segments within Nielsen industries. Page 12

13 WE MAXIMISE REACH ACROSS ALL PLATFORMS Q1 EXAMPLES maxdome / ProSieben / André Kowalski DIGITAL EXTENSION OF TV FORMATS: GERMANY S NEXT TOPMODEL SEASON 13 (February 8, -April 23, 2018) JOINT PRODUCTION FOR SVOD & TV: JERKS. SEASON 2 TV rating 1) Digital reach extension 2) Up to 21.5% +47% SVOD: April 2018 TV: from May 8, 2018 onwards 1) Basis: all German TV households, A 14-49, Mon-Sun, 3-3 h. Source: AGF in cooperation with GfK/TV Scope/ProSiebenSat.1 TV Deutschland. 2) Incremental reach based on video views (not unique) through digital offerings (including channel web & app, 7TV web & app, HbbTV, SmartTV without syndication and YouTube); TV basis: target group 3+ years, TV contacts with >1 minute of viewing, multiple views per user possible; source: AGF in cooperation with GfK/TV Scope/P7S1 TV Deutschland/Google Analytics/Webtrekk. Page 13

14 ENABLING 360 ADVERTISING CAMPAIGNS TV ONLINE, MOBILE, SOCIAL PRINT 1) LICENSING POS / RETAIL 1) Product placement in print: only Deichmann and GNTM. Page 14

15 NETID FOUNDATION SUPPORTS FUTURE-READY DATA STRATEGY FOUNDING PARTNERS KEY OBJECTIVES Open industry standard netid for log-in services compliant with GDPR and potential future eprivacy regulation Convenient and transparent privacy management for users Launch in summer ) Key enabler for future-ready data strategy compliant with regulatory environment Note: GDPR is General Data Protection Regulation. 1) First partner. Page 15

16 NEW DISTRIBUTION DEALS STRENGTHEN HD BUSINESS P7S1 HD SUBSCRIBERS NEW PLAYERS & DEALS HD FTA subscriber development [in m] m 2018 target +1.5m vs. Q Launch 04/18 Satellite: New deal to increase competition Launch 04/18 Satellite: New deal to increase competition Q Q Q Q Q Q Q Launch 04/18 3.0% 11.9% 14.6% 16.8% 19.3% 8.5% 23.1% HD PENETRATION OTT: New rights for HD Note: HD penetration based on total TV households in Germany (38.58m); source: Astra TV Monitor Note: HD free-to-air subscribers Germany shown, paying subscriber figures as reported by platform partners (EoP; subject to subsequent adjustments by platform partners). Page 16

17 EXPANSION OF FEATURES & PLATFORMS ENABLES FURTHER GROWTH NEW FEATURES enable monetization beyond HD TRADITIONAL PLAYERS secure reach and drive HD penetration OTT PLATFORMS extend our traditional reach Satellite OTT/ Mobile OTT/ Mobile HD HD Technical reach: 17.7m HH 2) NEW NEW >4m unique users 3) Instant Restart 1) Cable Technical reach: 16.4m HH 2) IPTV Technical reach: 2.6m HH 2) NEW Phones/ tablets >79m devices 4) Connected Smart TVs >20m devices 4) Networkbased Digital Video Recorder (NDVR) 1) REC Terrestrial Technical reach: 1.8m HH 2) Streaming devices >3.5m devices 5) Note: HH = households. 1) Dependent on license availability. 2) Astra Monitor report 2017 published 03/ ) Complementary to cable, satellite, terrestrial and IPTV distribution; unique users per month, company publications, AGOF figures and P7S1 assumptions. 4) SNL Kagan January 2018 and P7S1 assumptions (SNL Kagan forecast 2018 installed base: 68m smartphones & 11.9m tablets, tablet market slightly shrinking; 20.3m Smart TVs). 5) P7S1 internal estimate. Page 17

18 GRAVITAS ACQUISITION EXPANDS GLOBAL SALES BUSINESS TITLES IN THE CATALOGUE 1) INTERNATIONAL SALES CLIENTS 2) 4,265 +3,300 Gravitas titles Gravitas clients Q Q Q Q Q Q Gravitas Ventures is adding over 400 new titles to the catalogue per year 1) Cumulative 2010 to Q1 2018, thereof 965 RASI and 3,300 Gravitas titles; Q and Q numbers w/o Gravitas. 2) Thereof 440 RASI and 140 Gravitas clients, excl. Gravitas broadcaster clients; Q and Q numbers w/o Gravitas. Page 18

19 ALL NUCOM GROUP DEALS SUCCESSFULLY CLOSED MINORITY BUY-OUTS AT CORNERSTONE ASSETS 74.9% 25.1% Footer Page 19

20 STRONG OPERATIONAL START INTO 2018 EXAMPLES Excellent development of registrations and new subscribers also driven by significant upgrades of mobile product offering Strong development of B2C sales thanks to innovative product and marketing concepts Continued dynamic sales performance due to focused marketing push Page 20

21 THREE THINGS TO REMEMBER Implementation of new Group setup well on track Solid performance of core TV business Well positioned within non-tv businesses Page 21

22 WE CONFIRM OUR FINANCIAL OUTLOOK 2018 FY 2018 GROUP REVENUES low to mid single-digit increase (%) ADJUSTED EBITDA MARGIN mid-20s % ADJUSTED NET INCOME ~50% adj. EBITDA to adj. net income conversion FINANCIAL LEVERAGE TARGET 1.5x-2.5x DIVIDEND PAY-OUT RATIO 1) 80-90% 1) of adjusted net income. Page 22

23 FINANCIALS DR. JAN KEMPER CHIEF FINANCIAL OFFICER

24 KEY FINANCIAL TOPICS IN Q GROUP REVENUES GROUP EARNINGS ENTERTAINMENT CP&GS Reported revenues affected by deconsolidation and adverse currency effects, portfolio/currency adjusted Group revenue growth slightly positive Solid adjusted EBITDA and adjusted net income increase, adjusted EBITDA margin improvement Positive development of TV advertising business, overall solid segment revenue increase and profitability Still demanding market environment, negative currency effects due to weakened U.S. dollar affecting topline performance COMMERCE Continued revenue growth across key assets, negative net deconsolidation effects mainly due to sale of etraveli FINANCIAL LEVERAGE Financial leverage of 1.5x net financial debt/adjusted EBITDA at low end of target range, sufficient financing headroom to execute M&A deal pipeline Page 24

25 Q1 2018: SOLID ADJUSTED EBITDA AND ADJUSTED NET INCOME GROWTH ON GROUP LEVEL GROUP FINANCIALS [in EUR m; growth rates in %] CONSOLIDATED REVENUES ADJUSTED EBITDA ADJUSTED NET INCOME % -3% portfolio/ +7% +6% currency 881 adjusted Q Q Q Q Q Q Adjusted EBITDA margin: 22.7% Page 25

26 ENTERTAINMENT SEGMENT WITH SOLID START INTO 2018 EXTERNAL SEGMENT REVENUES [in EUR m; growth rates in %] ENTERTAINMENT CONTENT PRODUCTION & GLOBAL SALES COMMERCE +2% -13% -14% Q Q Q Q Q Q Page 26

27 ENTERTAINMENT: SEGMENT REVENUE GROWTH DRIVEN BY TV ADVERTISING, DISTRIBUTION AND OTHER REVENUES EXTERNAL REVENUES AND ADJUSTED EBITDA [in EUR m; growth rates in %] Q Q YoY Ext. revenues % Advertising % Distribution 1) % Other % Adj. EBITDA % COMMENTS Solid start of TV advertising business supported by timing of Easter with revenue growth rate above segment average Positive TV advertising performance offset by lower revenues of SevenVentures and softer AdVoD performance Continued dynamic growth of distribution business driven by HD and new products Double-digit revenue growth of all other entertainment revenues combined Strong margin expansion driven by combination of TV advertising, distribution and internal revenue growth as well as cost discipline, lower unscheduled program costs and IFRS16 benefit 1) Reported figures excluding distribution-related revenues which have been included in advertising revenues. Page 27

28 CONTENT PRODUCTION & GLOBAL SALES: ADVERSE CURRENCY EFFECTS EXTERNAL REVENUES AND ADJUSTED EBITDA [in EUR m; growth rates in %] Q Q YoY COMMENTS Ext. revenues % Production % Global sales % Meaningful negative currency effects due to weaker U.S. dollar affecting both Red Arrow and Studio71 business Revenues from U.S. content production business below prior year also due to a generally higher production volatility Organic revenue decline partly offset by first-time consolidation effect of Gravitas Ventures Other % Adj. EBITDA 4 4-8% Adjusted EBITDA largely unaffected by currency headwind Page 28

29 COMMERCE: MEANINGFUL DECONSOLIDATION EFFECTS AND SOLID ORGANIC GROWTH EXTERNAL REVENUES AND ADJUSTED EBITDA [in EUR m; growth rates in %] Q Q YoY Ext. revenues % Digital services % Physical products % Other % Adj. EBITDA % COMMENTS Continued strong organic revenue growth driven by Parship, Flaconi and Amorelie Segment/digital services revenues below prior year mainly due to portfolio changes (deconsolidation of etraveli and COMVEL, partially offset by firsttime consolidation of Jochen Schweizer) Online Price Comparison business with below-average growth due to lower activity in energy price comparison business Adjusted EBITDA development below prior year as a result of portfolio changes as well as implementation of new media contract Page 29

30 FINANCIAL LEVERAGE AT THE LOWER END OF TARGET RANGE PROVIDING SUFFICIENT HEADROOM FOR M&A NET FINANCIAL DEBT [in EUR m] FINANCIAL LEVERAGE 1.8x 1.5x ) 03/31/2017 Dividend M&A capex and financial investments 2) etraveli disposal FCF before M&A Other financing cash flow incl. dividend payments 03/31/2018 Financial leverage: net debt/ltm adj. EBITDA (LTM adj. EBITDA of EUR 1,063m (previous year: EUR 1,035m) for continuing operations). Note: net debt as of 3/31/2018 after reclassification of cash and cash equivalents of held-for-sale business (Tropo). 1) Pre closing of NuCom transaction as well as closing of minority stake acquisitions in Parship Elite, Verivox, billiger-mietwagen.de (Silvertours) and Amorelie (Sonoma Internet), IFRS net debt as per P7S1 definition (i.e. excluding EUR 167m finance lease liabilities). 2) Majority acquisitions, acquisitions of minorities, put liabilities and VC fund investments. Page 30

31 2017 DIVIDEND PROPOSAL ADJUSTED NET INCOME & DIVIDEND DIVIDEND PROPOSAL [in EUR m] ~290 2) %/+10% CAGR 1) Dividend per share: EUR 1.93 Total dividend pay-out 3) : EUR 442m Pay-out ratio: 80.3% AGM on May 16, % dividend yield 4) Dividend payment on May 22, Adjusted net income Dividend payment 1) Underlying/adjusted net income CAGR %, dividend CAGR % (note: underlying net income changed to adjusted net income in FY 2017). 2) Normalized dividend estimate based on average dividend pay-out ratio of c. 82%, actual dividend pay-out of EUR 1,201.4m included disposal related dividend increase. 3) Dividend pay-out calculated on the basis of 228.9m shares (4.1m treasury shares not entitled to a dividend); proposed 2017 dividend subject to Supervisory AGM resolution. Board 4) and Based on share AGM price of resolution. EUR ) Based on December on share 31, price of EUR on December 31, Page 31

32 GROUP Q2-Q ADJUSTED EBITDA DEVELOPMENT TO REFLECT DEVIATING SEASONALITY OF PROGRAM SPEND GROUP PROGRAM CONSUMPTION (ESMA) [in EUR m, Q Q actual, Q2-Q estimate] COMMENTS Seasonality in terms of program costs to normalize in FY2018 Planned program cost increase in Q2 and Q3 to be offset by reduction in Q Full-year program cost expected to increase broadly in line with prior years Q2 and Q3 Group adj. EBITDA expected to be negatively affected by planned program cost increase Q4 Group adj. EBITDA to benefit from more front-loaded program spend 100 Q1 Q2 Q3 Q A/E FY (RS) 0 Full-year 2018 Group adj. EBITDA target unaffected by deviating seasonality of program cost Note: ESMA adjusted program consumption Page 32

33 WE CONFIRM OUR FINANCIAL OUTLOOK 2018 FY 2018 GROUP REVENUES low to mid single-digit increase (%) ADJUSTED EBITDA MARGIN mid-20s % ADJUSTED NET INCOME ~50% adj. EBITDA to adj. net income conversion FINANCIAL LEVERAGE TARGET 1.5x-2.5x DIVIDEND PAY-OUT RATIO 1) 80-90% 1) of adjusted net income. Page 33

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35 APPENDIX

36 GROUP P&L [in EUR m] Q Q Δ Revenues % Adjusted EBITDA % Reconciling items >+100% Thereof -EUR 61m provision for reorganization -EUR 4m M&A-related expenses -EUR 2m valuation effect Group Share Plan EBITDA % Depreciation and amortization % Thereof PPA % Operating profit (EBIT) % Financial result >100% Thereof interest result % Result before income taxes (EBT) % Consolidated net profit 1) % Adjusted net income % Net financial debt 1,620 1,889-14% Note: Net debt as of 03/31/2018 after reclassification of cash and cash equivalents of held-for-sale business (Tropo). 1) After non-controlling interests Page 36

37 DISCLAIMER This presentation contains "forward-looking statements" regarding ProSiebenSat.1 Media SE ("ProSiebenSat.1") or ProSiebenSat.1 Group, including opinions, estimates and projections regarding ProSiebenSat.1's or ProSiebenSat.1 Group's financial position, business strategy, plans and objectives of management and future operations. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of ProSiebenSat.1 or ProSiebenSat.1 Group to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements speak only as of the date of this presentation and are based on numerous assumptions which may or may not prove to be correct. No representation or warranty, expressed or implied, is made by ProSiebenSat.1 with respect to the fairness, completeness, correctness, reasonableness or accuracy of any information and opinions contained herein. The information in this presentation is subject to change without notice, it may be incomplete or condensed, and it may not contain all material information concerning ProSiebenSat.1 or ProSiebenSat.1 Group. ProSiebenSat.1 undertakes no obligation to publicly update or revise any forward-looking statements or other information stated herein, whether as a result of new information, future events or otherwise.