First Half and Second Quarter Results 2017 August 11th, 2017

Transcription

1 First Half and Second Quarter Results 2017 August 11th, 2017

2 Disclaimer Forward Looking Statements Certain information included in this presentation may contain projections or other forward-looking statements regarding future events or the future financial performance of Grupo Clarín. You can identify forward-looking statements by terms such as expect, believe, anticipate, estimate, intend, will, could, may or might the negative of such terms or other similar expressions. These statements are only predictions and actual events or results may differ materially. Grupo Clarín does not undertake or intend to undertake any obligation to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in Grupo Clarín s projections or forward-looking statements, including, among others, general economic conditions, Grupo Clarín s competitive environment, risks associated with operating in Argentina, rapid technological and market change, and other factors specifically related to Grupo Clarín and its operations. 2

3 Agenda Argentina Latest Events Grupo Clarín Income Statement & Financial Debt Business Segments CVH Transaction Summary Income Statement & Financial Debt Cablevisión Results Q & A Session

4 Macroeconomic Environment Key Indicators Consumer Price Index (1) % yoy Central Bank Reference Rate (*) % yoy 28% 36% 45% 44% 40% 34% 25% 33,0 38,0 30,8 26,8 24,8 22,3 25,5 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Consumer Price Index (1) GDP Argentina (**) % qoq % YoY 3,0 3,9 4,4 1,5 2,1 2,2 1, ,6-1,1 % QoQ -1,7 0,1-1,9 0,7 0,3 1,1 2,5 1,1 4Q15 1Q16 3Q16 4Q16 1Q17 (1) Source: Ecolatina. (*) Central Bank reference rate 35 days: (**) Source INDEC: e: Private Consensus -4 1Q16-3,7-3,7 3Q16 4Q16 1Q17 e 4

5 Agenda Argentina Latest Events Grupo Clarín Income Statement & Financial Debt Business Segments CVH Transaction Summary Income Statement & Financial Debt Cablevisión Results Q & A Session

6 Income Statement 1H17 & 1H16 yoy figures Exhibit 1: Net Sales Exhibit 2: Adjusted EBITDA 1 EBTIDA Margin (%) % yoy, +30% 6, % yoy, % ,832 1, , ,609 2, H16 Broadcasting & Programming 1H H16 1H17 Exhibit 3: Income for the period 1H17 vs. 1H16 Printing & Publishing Digital Content & Others Eliminations 1H16 1H17 1,228 1, , , % Equity Shareholders Non-Controlling Interests 1 We define Adjusted EBITDA as net sales minus costs of sales (excluding depreciation and amortization) and selling and administrative expenses (excluding depreciation and amortization) Source: Company Information 6

7 Income Statement & yoy figures Exhibit 4: Net Sales % yoy, Exhibit 5: Adjusted EBITDA 1 % yoy, EBTIDA Margin (%) +31% 3, % 389 2, , , ,395 1, Broadcasting & Programming Exhibit 6: Income for the period vs. Printing & Publishing Digital Content & Others Eliminations % Equity Shareholders Non-Controlling Interests 1 We define Adjusted EBITDA as net sales minus costs of sales (excluding depreciation and amortization) and selling and administrative expenses (excluding depreciation and amortization) Source: Company Information 7

8 Income Statement &, yoy figures EBTIDA Margin (%) Exhibit 7: 2,746 31% Exhibit 8: 3,606 1,585 37% 2, % 1, % 389 Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Source: Company Information 8

9 Financial Debt Exhibit 9: Key Financial Ratios 64 MM at ARS/ USD 6M17 FY16 % Ch. Total Gross Debt Outstanding* 1, % Total Gross Debt Incl. Interests** 1, % Total Net Debt % Net Debt/ Adjusted EBITDA 1.27x.1x 177.0% % US$ Debt 34.9% NA NA Exhibit 10: Debt Profile as of June 30 th, 2017 US$ MM, Balance Sheet Total * Includes Bank Overdraft (357.4 MM ARS as of June 2017; MM ARS as of December 2016). Does not include Interests and Related Parties. ** Includes Bank Overdraft (357.4 MM ARS as of June 2017; MM ARS as of December 2016). Does not include Related Parties. (1) Last Quarter Annualized EBITDA. Exchange Rate: ARS/ USD. Source: Company Information 9

10 Agenda Argentina Latest Events Grupo Clarín Business Segments Income Statement & Financial Debt CVH Transaction Summary Income Statement & Financial Debt Cablevisión Results Q & A Session

11 Broadcasting & Programming Revenues & Costs EBTIDA Margin (%) Exhibit 11: 1,203 51% Exhibit 12: 1, % 1, % % 415 Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Exhibit 13: Revenues 1H16 vs. 1H17 +51% Exhibit 14: EBITDA 1H16 vs. 1H17 +55% 1H16 1,915 1H H17 2,886 1H Source: Company Information 11

12 Broadcasting & Programming II Key Ratios Exhibit 15: Key Ratios % % Prime Time 1 (%) % 33.4 Advertising Share 2 (%) (1) Share of broadcast TV audience according to IBOPE for AMBA. Prime time is defined as Monday through Friday from 8pm to 12am. Total time is defined as Monday through Sunday from 12pm to 12am (2) Company estimate, over adspend in Ps. in broadcast TV for AMBA region Source: Company Information Total Time 1 (%) 12

13 Printing & Publishing Revenues & Costs EBTIDA Margin (%) Exhibit 16: 1,395 13% Exhibit 17: 1, % % 202% Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Exhibit 18: Revenues 1H16 vs. 1H17 +13% Exhibit 19: EBITDA 1H16 vs. 1H17 1H16 2,609 1H16-4 1H17 2,958 1H Source: Company Information 13

14 Printing & Publishing II Key Ratios Exhibit 20: Key Ratios 237-9% 217-3% Circulation 1 ( 000s) % 38.9 Advertising Share 2 (%) Circulation Share 3 (%) (1) Average number of copies according to IVC (including Diario Clarín and Olé), thousands per day (2) Share in Buenos Aires and greater Buenos Aires Area (AMBA) Diario Clarín. Source: Monitor de Medios Publicitarios S.A. (3) Share in Buenos Aires and greater Buenos Aires Area (AMBA) Diario Clarín. Source: IVC and AGEA 14

15 Digital Content & Others Revenues & Costs EBTIDA Margin (%) Exhibit 21: % Exhibit 22: % (8.3) 21 39% 78% 168 (9.3) 37 Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Exhibit 23: Revenues 1H16 vs. 1H17 +53% Exhibit 24: EBITDA 1H16 vs. 1H17 1H H H H17-58 Source: Company Information 15

16 Agenda Argentina Latest Events Grupo Clarín Income Statement & Financial Debt Business Segments CVH Transaction Overview Income Statement & Financial Debt Cablevisión Results Q & A Session

17 Transaction Overview Latest Events CVH & Cablevisión SA Preliminary Merger Agreement Board of Directors of Cablevisión S.A has approved the Pre-Merger Commitment whereby Cablevisión will merge into Telecom Argentina ( TEO ) subject to certain corporate and regulatory approvals Exchange ratio: 9, new shares of Telecom Argentina to be issued in exchange for each common share of Cablevisión with a nominal value of Ps. 10,000 per share Telecom Argentina will issue 1,184,528,406 new common, book entry shares with a nominal value of Ps. 1 and one vote per share, to be delivered to the shareholders of Cablevisión General Ordinary and Extraordinary Shareholder s Meeting to be held on 31 August 2017 (CV and TEO) Call Option Call Option for the acquisition of a direct or indirect participation equal to 13.51% of Telecom, approximately 6% of the surviving entity. Call Option exercise price of USD 634,275,282 The maximum term for the exercise of the call option is one year counted as from 7 July Shareholders Agreement Subject to the satisfaction of certain conditions CVH shall have the right to appoint a majority of the members of the Board of Directors, Executive Committee, Audit Committee and Supervisory Committee Scheme of special majorities for the approval of certain matters by the Board of Directors and/or the Shareholders The Agreement provides far rights of first refusal, tag along and drag along subject to certain requirements and conditions 17

18 Transaction Summary and Capital Ownership Transaction Summary Cablevisión S.A., in an all stock transaction, will be absorbed by Telecom Argentina Cablevisión S.A. shareholders will receive 1,184.5mm new shares of Telecom Argentina All resulting company share classes will have equal economic and voting rights Cablevisión shareholders will receive 55% of the combined company shares Reference equity values of US$6.1bn for CV and US$5.0bn for TEO 60.0% 40.0% Post-transaction 1,2 Simplified ownership structures Pre-transaction structure 1 Fintech Media Former Nortel Fintech Telecom 3 Pref. Stock ANSeS Float % Class B Class B shares Total Float 20.4% 25.4% 19.0% Fintech Fintech Media 6 Telecom 3 Float4, % 22.0% 15.8% 29.2% 1 Pre-transaction ownership structure of TEO after the reorganization of Telecom Argentina, Telecom Personal, Nortel Inversora and Sofora Telecomunicaciones 2 After the reorganization of Telecom Argentina and illustrates the ownership structure of the combined company 3 Only includes Fintech Telecom ownership through Sofora Telecomunicaciones 4 Float includes former Nortel Preferred Class B shares and shares held by the ANSeS 5 The Float includes 6.0% pretransaction direct holding of Fintech Advisory in TEO (equivalent to 2.7% posttransaction holding) 6 Total Post/transaction holding of Fintech will reach 40.5% 18

19 Call Option and Shareholder Agreement Pre- call option transaction structure 1 Shareholder Agreement 33.0% Post-call option 1,2 39.1% Fintech Media + Fintech Telecom 3 Float 5 Fintech Media + Fintech Telecom % 37.8% Float % 29.2% Subject to the satisfaction of certain conditions the CEO and other Key Employees (other than the CFO and the Internal Auditor) to be designated by the Board of the Company shall be a person proposed by CVH Subject to the satisfaction of certain conditions the CFO and the Internal Auditor of the Company to be designated by the Board of the Company shall be a person proposed by Fintech Advisory 1 Pre-transaction ownership structure of TEO after the reorganization of Telecom Argentina, Telecom Personal, Nortel Inversora and Sofora Telecomunicaciones 2 After the reorganization of Telecom Argentina and illustrates the ownership structure of the combined company 3 Only includes Fintech Telecom ownership through Sofora Telecomunicaciones 4 Float includes former Nortel Preferred Class B shares and shares held by the ANSeS * Note: Fintech includes Fintech Media and Fintech Telecom 5 The Float includes 6.0% pretransaction direct holding of Fintech Advisory in TEO (equivalent to 2.7% post-transaction holding) 6 Total Post call option holding of Fintech will reach 34.5% 19

20 Agenda Argentina Latest Events Grupo Clarín Income Statement & Financial Debt Business Segments CVH Transaction Summary Income Statement & Financial Debt Cablevisión Results Q & A Session

21 CVH Income Statement & Financial Debt Two Months ended June 30, 2017 ( 2M17 ) Exhibit 25: Revenues & EBITDA 1 Exhibit 26: CV Debt Profile as of June 30 th, 2017 % yoy, 6,681 EBTIDA Margin (%) US$ MM ,482 1, , Total 1 Net Sales Cost of Sales Selling & Adm. Expenses EBITDA Exhibit 28: CV Key Financial Ratios Exhibit 27: Income for the period 2M17 2M M17 6M16 YoY Total Financial Debt 10,039 10,265 (2.2%) Cash And cash Equivalents 1,691 4,119 (59%) Total Net Debt 8,299 6,098 36% Equity Shareholders Non-Controlling Interests Net Debt / Adj EBITDA 0.64x 0.68x NA 1 We define Adjusted EBITDA as net sales minus costs of sales (excluding depreciation and amortization) and selling and administrative expenses (excluding depreciation and amortization) 21 Source: Company Information

22 Agenda Argentina Latest Events Grupo Clarín Income Statement & Financial Debt Business Segments CVH Transaction Summary Cablevisión Results Income Statement & Financial Debt Q & A Session

23 Cablevisión Income Statement 1H17 & 1H16 yoy figures Exhibit 29: Revenues % yoy, 14,243 2, % 19,233 1,954 Exhibit 30: Adjusted EBITDA 1 % yoy, % 5, , EBTIDA Margin (%) ,279 7,435 12,141 5,076 1H16 1H17 1H16 1H17 Exhibit 31: Income for the period 1H17 vs. 1H16 Pay TV and Internet Access IDEN Telephony 1H16 2,089 1H17 3, % 1 We define Adjusted EBITDA as net sales minus costs of sales (excluding depreciation and amortization) and selling and administrative expenses (excluding depreciation and amortization) 23

24 Cablevisión Income Statement & yoy figures Exhibit 32: Revenues % yoy, 7,175 1, % 9, Exhibit 33: Adjusted EBITDA 1 % yoy, % 2, , EBTIDA Margin (%) ,868 3,723 6,119 2,438 Exhibit 34: Income for the period 1H17 vs. 1H16 Pay TV and Internet Access IDEN Telephony 887 1, % 1 We define Adjusted EBITDA as net sales minus costs of sales (excluding depreciation and amortization) and selling and administrative expenses (excluding depreciation and amortization) 24

25 Cablevisión Income Statement &, yoy figures EBTIDA Margin (%) Exhibit 35: 7,174 37% Exhibit 36: 9,800 2,837 29% 3,658 1,776 36% 2, ,561 46% 3,734 Revenues Cost of Sales Selling & Adm. Expenses EBITDA Revenues Cost of Sales Selling & Adm. Expenses EBITDA Source: Company Information 25

26 1 H a n d 2 Q R e s u l t s - A u g u s t 1 1 t h Cable TV. Internet Access & Telephony Key Ratios Exhibit 37: Cable & Internet Access Statistics 000s 1H17 1H16 % Ch, 1Q17 QoQ YoY Homes Passed (*) 7, , % 7, , , % 0.6% Bidirectional Homes Passed 76.6% 73.4% 4.4% 77% 76% 73% 0.8% 4.4% Total CATV Subscribers 3, ,522.1 (0.3%) 3, , ,522.1 (0.0%) (0.3%) Churn Rate 14.9% 14.0% 6.1% (5.1%) 13.3% Digital Ready Pay TV Subs 3, , % 3, , , % 1.2% Total Internet Subscribers 2, , % 2, , , % 7.3% Total ARPU % % 43.3% Exhibit 38: Mobile Telephony Statistics 000s 1H17 1H16 % Ch, 1Q17 QoQ YoY Postpaid Subs (31.2%) (28.0%) (28.0%) Postpaid ARPU (AR$) % % 19.0% Source: Company Information 26

27 Cable TV, Internet Access & Telephony Key Ratios for Cable TV and Internet Access Exhibit 39: Unique Subs (1) Exhibit 40: Total Cable Subs Exhibit 41: Total Equity Subs (1) 000s 000s 000s % % % Exhibit 42: Internet Subs Exhibit 43: Digital Subs Exhibit 44: Total ARPU (1) 000s % Other Internet Subs Cablemodem s 1, % 2,148 Argentina International +420 AR$ % ,514 1, (1) Taking into account Unique Clients Source: Company Information 27

28 Cablevisión Capex & Revenues 1H17 & 1H16, YoY figures Exhibit 45: Capex & Net Sales Exhibit 46: Capex & Net Sales 14,243 19,233 USMM 1H16 Net Sales 25.4% 3,620 1H16 Capex 1H17 Net Sales 28.9% 5,554 1H17 Capex % % 17% 17% Cablevisión CAPEX % % Capex/Sales Source: Company Information Net Sales Cable TV, Internet Access & Telephony Capex Cable TV, Internet Access & Telephony Note FX FX 2011: $4.13; FX 2012: $4.55; FX 2013: $5.48; FX 2014: $8.12; FX 2015: $9.27; FX 2016: $14.79; Source: Company Information 28

29 Agenda Argentina Latest Events Grupo Clarín Income Statement & Financial Debt Business Segments CVH Transaction Summary Q & A Session Income Statement & Financial Debt Cablevisión Results

30 Q & A Session August 11th, 2017

31 First Half and Second Quarter Results 2017 August 11th, 2017