Roadshow Presentation New York, September 18-19, 2014

Transcription

1 Roadshow Presentation New York, September 18-19, 2014 Dr Mathias Döpfner, Chairman & CEO Dr Julian Deutz, CFO Daniel Fard-Yazdani, Co-Head of Investor Relations

2 Disclaimer This document, which has been issued by Axel Springer SE (the "Company"), comprises the written materials/slides for a presentation of the management. Whilst all reasonable care has been taken to ensure that the information and facts stated herein are accurate and that the opinions and expectations contained herein are fair and reasonable no representation or warranty, express or implied, is given by or on behalf of the Company, any of its directors, or any other person as to the accuracy or completeness of the information or opinions contained in this document and no liability is accepted for any such information or opinions. This document contains forward looking statements which involves risks and uncertainties. These forward looking statements speak only as of the date of this document and are based on numerous assumptions which may or may not prove to be correct. The actual performance and results of the business of the Company could differ materially from the performance and results discussed in this document. The Company undertakes no obligation to publicly update or revise any forward looking statements or other information contained herein whether as a result of new information, future events or otherwise. This document does not constitute or form any part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in the Company, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto. 2

3 Our corporate mission The leading digital publisher 3

4 Axel Springer s transformation to digital along core areas of expertise 3 Zimmer mit Haus im Grünen, Moderne Altbauwohnung, 75 m², gesucht! 2 gesucht! Ich, 43, wohnung, 75 m², gesucht! 2 Wohnung Mitbewohner Moderne Altbau- Wohnung Finesse, niedrige von privat! Keine Energiekosten Courtage! 030 Beste Lage! Zi.,Kü,Bad. Ab w, suche Mitbewohner, m, der mir Chiffre 0815 sofort! Beste Lage! Zi.,Kü,Bad. Ab dank Solaranlage, Chiffre 0815 sofort! ca 83m² Wfl., im Haushalt hilft Zimmer mit Moderne Altbauwohnung, 75 m², Haus im Grünen, Mitbewohner Finesse, niedrige 3 Zimmer mit 650 Miete + NK Finesse, niedrige Mitbewohner oder mietähnliche Energiekosten gesucht! Ich, 43, Beste Lage! von privat! Keine gesucht! Ich, 43, Energiekosten Kaufraten, Bezug dank Solaranlage, w, suche Mitbewohner, m, der mir Mitbewohner, m, ca 83m² Wfl., Chiffre 0815 Courtage! 030 w, suche dank Solaranlage, sofort ca 83m² Wfl., Miete + NK im Haushalt hilft der mir im 650 Miete + NK Mitbewohner Mitbewohner Wohnung oder mietähnliche Haushalt hilft oder mietähnliche Haus im Grünen, gesucht! Ich, 43, gesucht! Ich, 43, gesucht! 2 Kaufraten, Bezug Kaufraten, Bezug von privat! Keine w, suche Mitbewohner, m, der mir wohner, m, der mir von privat! Keine w, suche Mitbe- Haus im Grünen, Zi.,Kü,Bad. Ab sofort sofort Courtage! 030 sofort! im Haushalt hilft. im Haushalt hilft. Courtage! 030 Moderne Altbauwohnung, 75 m², gesucht! 2 gesucht! Ich, 43, Wohnung jetzt Mitbewohner 3 Zimmer mit Haus im Grünen, Haus im Grünen, Finesse, niedrige von privat! Keine von privat! Keine Moderne Altbauwohnung, 75 m², Beste Lage! Zi.,Kü,Bad. Ab w, suche Mitbewohner, m, der mir Energiekosten Courtage! 030 Courtage! 030 Chiffre 0815 sofort! dank Solaranlage, Beste Lage! im Haushalt hilft. Moderne Altbauwohnung, 75 m², 650 Miete + NK Moderne Altbau- ca 83m² Wfl., Chiffre Zimmer mit Mitbewohner Mitbewohner Finesse, niedrige gesucht! Ich, 43, gesucht! Ich, 43, Beste Lage! oder mietähnliche wohnung, 75 m², Energiekosten w, suche 3 Zimmer mit w, suche Chiffre 0815 Kaufraten, Bezug Beste Lage! dank Solaranlage, Mitbewohner, m, Finesse, niedrige Mitbewohner, m, sofort Chiffre 0815 ca 83m² Wfl., der mir im Energiekosten der mir im Mitbewohner 650 Miete + NK Haushalt hilft. dank Solaranlage, Haushalt hilft. gesucht! Ich, 43, Moderne Altbauwohnung, 75 m², Kaufraten, Bezug 650 Miete + NK von privat! Keine oder mietähnliche ca 83m² Wfl., Haus im Grünen, Wohnung Haus im Grünen, w, suche gesucht! 2 von privat! Keine Mitbewohner, m, Beste Lage! sofort oder mietähnliche Courtage! 030 Zi.,Kü,Bad. Ab Courtage! 030 der mir im Chiffre Kaufraten, Bezug sofort! Haushalt hilft sofort Paid Models Marketing Models Classified Ad Models Portfolio of market-leading media brands in Germany and international markets Portfolio of reach- and performance-based marketing models Portfolio of classified ad models with focus on real estate, jobs and cars Digital revenue share 20% Digital revenue share 100% Digital revenue share 100% 4

5 Axel Springer at a Glance Highlights Germany s leading publisher with unique media brands Successful transformation with 65% of EBITDA from digital activities Organic growth supported by active M&A with strong track record Strong balance sheet and cashflow High dividend yield Revenues by segment (%) EBITDA by segment (%) 6% 16% 36% 51% -14% 27% 55% 23% Current Financials 2013 Outlook 2014 Revenues 2,801.4 Up single-digit % EBITDA Up low double-digit % Paid Models Marketing Models Classified Ad Models Services / Holding EBITDA-margin 16.2% EPS (adj.) 1.81 Up low double-digit % DPS

6 Active portfolio management accelerates shift to digital Revenues Advertising Revenues EBITDA 49% 27% 35% 86% 78% 96% 51% 73% 65% 14% 22% 4% 2008 H1/ H1/ H1/14 Other (incl. Services / Holding) Digital H1/2014 figures on the basis of continuing operations only. 6

7 Closing of FUNKE transaction and sale of Czech activities at end of April 2014 Sale of regional newspapers and magazines to FUNKE Asset valuation of 920m After contractual adjustments (mainly transfer of net liabilities) purchase price at closing of 875m Cash payment of 634m by Funke at closing Expected tax payment of ~ 260m payable in several installments during second half of 2014 Vendor loan of 241m (repayment in year 5/6 after closing) Ringier Axel Springer Media sale of Czech activities Company valuation of 170m (50:50 Axel Springer/Ringier) After contractual adjustment (mainly net asset value) purchase price at closing of 183m Transaction mostly tax-free 7

8 Paid Models segment at a Glance Highlights Focus on market-leading media brands with clear path to digitization National paid models dominated by unique asset BILD WELT group complemented by leading news TV channel N24 National BILD group WELT group/n24 Paid Models International Ringier Axel Springer Media (Central Eastern Europe) Switzerland France, Russia, Spain Pioneering paid content in Germany with encouraging first results Strong presence in Eastern Europe (JV with Ringier) and Switzerland Current Financials 2013 Outlook 2014 Revenues 1,521.5 Up single-digit % EBITDA Up low to mid single-digit % EBITDA-margin 16.4% 8

9 Highlights Paid Models BILD a unique media brand print and online Print, daily reach in million 1) ma 09/I ma 09/II ma 10/I 12.5 ma 10/II ma 11/I 12.1 ma 11/II ma 12/I ma 12/II 12.8 ma 13/I ma 13/II 12.2 ma 14/I 11.3 ma 14/II Online, reach in million unique users 2) bild.de spiegel.de focus.de welt.de BILD vs. TV 11.3 Tatort Big Bang Theory Britain s Got Talent 9.6 Bild.de vs. Peers 2) BILD WSJ The Sun 1) ma Pressemedien, Note: change in population parameter after ma 2010 I 2) AGOF UUs (14+) in million per month (not incl. mobile internet). 9

10 Highlights Paid Models BILD reaches more than 220k digital subscribers Freemium model Introduced 06/2013 Price range: per month German soccer league highlight clips as additional option ( 2.99 per month) July months after start 223k Metered model Introduced 12/2012 Price range: per month German soccer league highlight clips as additional option ( 2.99 per month) July months after start 54k *) New reporting introduced June 2014 by IVW (IVW certifies and audits the circulations of major publications and online offerings in Germany). 10

11 Marketing Models segment at a Glance Highlights #1 positions in all major marketing business models Reach based marketing with strong organic growth and margins > 35% zanox group European market leader in performance marketing Performance marketing with structurally low margin (~5%) Investments for further growth affect 2014 EBITDA Marketing Models Reach Based Marketing Performance Marketing Idealo zanox group aufeminin Digital Window kaufda/bonial eprofessional (Main activities) Current Financials 2013 Outlook 2014 Revenues Up low double-digit % EBITDA stable EBITDA-margin 14.4% 11

12 Highlights Marketing Models Idealo: Germany s #1 price comparison platform Company Overview / History Founded in 2000 Break-even in 2003 Acquisition by Axel Springer in 2006 (#5 market position) Marketing via print and online reach of Axel Springer helps to achieve #1 market position Today ~150m offers by >37,000 shops on idealo.de, >700 employees (FTE) Largest digital EBITDA contributor outside Classifieds segment Continuous success since acquisition Revenues 10x EBITDA 10x All figures incl. acquisitions. 12

13 Highlights Marketing Models aufeminin.com: From a French website to the world s leading digital publisher for women Company profile The leading women s network 42m unique users worldwide, 31m in Europe 1) Axel Springer invested since August 2007 (stake 82.3%) Active in 15 countries Bolt-on acquisitions to accelerate growth 2008: onmeda.de in Germany 2011: netmums.com in UK 2013: MyLittleParis in France Strong growth and successful internationalization Revenues in m % 8% % 56% France International 1) Source: comscore, monthly average, 2014 (Jan.-Jun.); not incl. mobile internet 13

14 Highlights Marketing Models kaufda: Going fast track international Business model 2008: Start in Germany, quickly achieved market leading position Research online buy offline Making use of location-based offerings, also adding push alert functions 2014: Bolt-on acquisition of MeinProspekt Print insert goes digital Cost per Click Internationalization 2011: France 2012: Russia, Spain, Brasil 2013: USA US market size for brochures (>15bn USD) exceeds European market Growth driven by mobile 80% of brochure view already coming from mobile: Total Mobile Jan 11 Dec 11 Dec 12 Dec 13 Brochure views Germany and France 14

15 Classified Ad Models segment at a Glance Highlights Portfolio of market leading classified ad models Digital classifieds clear beneficiary of structural shift from print to online Strong market positions yielding high margins JV (70:30) with General Atlantic (private equity) since April 2012 to accelerate M&A with additional firepower Eight acquisitions with total investment of almost 800m since start of JV Real Estate #1 in France #1 in Belgium #2/3 in Germany Current Financials Classified Ad Models Jobs #1 in Germany #1 in UK #1 in Ireland, South Africa 2013 Outlook 2014 Revenues Significant increase EBITDA Significant increase Cars #1 in France Local #1 in Germany Generalist #1 in Israel EBITDA-margin 40.7% 15

16 Highlights Classified Ad Models StepStone: Lead over competitors is widening Company profile #1 job portal in Germany, UK and Belgium High growth driven by operational excellence and market share gains Revenue growth and scalability of business resulting in strong margin improvement Several bolt-on acquisitions enabling knowhow transfer and best practice exchange Relevance of direct search in Germany limited Applications per job ad in Germany; 2012 & ) StepStone Competitor Competitor Competitor x 2.6 x 1.9 x 3.1 x 2.0 x 4.7 x Competitor x 7.1 x 7.5 1) Source: TNS 2012, n=746; poll period: April-June 2012; survey of 80,288 job offerors which have inserted job advertisements during this period; TNS 2013, n=4,169 16

17 Highlights Classified Ad Models SeLoger revenue growth driven by strong ARPU development Company profile #1 specialist real estate portal in France Penetration rate with real estate agents >80% Excellent competitive position and beneficiary from print to online shift Continued revenue growth driven by strong ARPU development over the last ten years Market conditions in French real estate slightly improving in 2014 after difficult 2012/ Monthly ARPU depending on regions (EUR) IDF Province Total Note: ARPU figures include revenues from Seloger.com, excludes verticals, as of December of each year 17

18 Highlights Classified Ad Models Three acquisitions in 2014 broadening the footprint in classifieds #1 portal for real estate, cars and generalist classifieds in Israel Add-on acquisition to complement #1 UK job portal Totaljobs #1 specialist portal in French car segment Deal terms Acquisition of 100% Company valuation of ~ 170m (cash/debt free) Transaction signed and closed in May 2014 Deal terms Acquisition of 100% Company valuation of 110m (cash/debt free) Signed in May 2014, closing envisaged in Q4/14 Deal terms Acquisition of 51%, options for remaining shares Company valuation of ~ 142m (cash/debt free) Signed June, closed in July

19 Highlights Classified Ad Models Investment quadrupled: Attractive sale of iproperty for 74m results in profit of 55m Company Description Leading online real estate portals in Malaysia, Hong Kong, Indonesia, Singapore and Macau Financials FY 2013: 13.1m revenues and 1.4m EBITDA Investment History Mainly between 2011 and 2012, SeLoger acquired stake of 17.2% with a total investment of 19.1m Strong share price development Divestment Sale to REA group for 74.3m results in pre-tax profit of 55.1m in July 2014 (expected tax payment of 2.2m) 19

20 Clear investment criteria Strategic fit along three areas of expertise Proven and scalable business models Clear path to profitability / profitable businesses Experienced and incentivized management Reasonable valuation 20

21 Active M&A to support organic growth M&A guidelines M&A with strong track record of price discipline and outstanding industry expertise Proven history of retaining successful founders/ management Industry-leading CEOs within Axel Springer adding value to M&A process Company transformation supported by digital acquisitions (total of ~2.6bn) and divestments (total of ~2.4bn) since ) Price-disciplined digital majority acquisitions 12 EBITDA-Multiple at acquisition date Reasonable multiple at acquisition date further significantly lowered by positive companies development 7 EBITDA-Multiple ) EV before purchase price adjustments, taxes etc. 21

22 Comfortable financial situation with significant headroom Net financial debt (-)/cash (+) 1) in m 12/31/13 06/30/14 07/31/ Future cash inflows > 550m 241m vendor loan to FUNKE Media Group 62.5m of vendor loan to Madsack remaining 259 sale of stake in Doğan TV 1) Excl. pension liabilities (06/30/14: 309m, 12/31/13: 288m). 2) Comparable to promissory note. Balance sheet and cash flow usage Low leverage of 0.2x Strong free cash flow generation (2013: 246m) Sufficient headroom for investments in digitization and high dividend (payout of 178m for 2013) Attractive financing in place Credit line: Volume of 900m, maturity in 2017, initial margin below 50 bps Schuldschein 2) : Volume of 500m secured in 2012 with maturity 2016/2018. Call executed at floating rate note and exchange offer currently marketed for fixed rate note with objective to optimize interest rates and extend maturity to 2018/

23 Priorities Establishing paid models as industry standard 2. Expanding European market leadership in classifieds on a global scale 3. Successful integration of WELT and N24 4. Continue value creating M&A activities 5. Further successful restructuring of central departments 23

24 Our corporate mission The leading digital publisher 24

25 Financial performance

26 Still high profitability in 2013 despite investments in digitization Revenues in m EBITDA in m 2,647 2,925 3,216 3,340 3, ,642 1, ,081 2,324 2,576 2,737 2,801 1,352 1, (12.6%) 392 (16.9%) 448 (17.4%) 499 (18.2%) 454 (16.2%) 241 (17.8%) 266 (18.5%) H1/2013 H1/ H1/2013 H1/2014 Discontinued operations Continuing operations : Figures for discontinued operations not audited; H1/2014 figures for discontinued operations only for January-April 26

27 Margin profile segments: Classified Ad Models with strong margin increase EBITDA in m Paid Models Marketing Models Classified Ad Models EBITDA margin in % H1/ H1/ H1/ H1/ H1/ H1/14 EBITDA EBITDA ex restructuring / launch costs EBITDA margin EBITDA margin ex LC/RC 27

28 Stable free cash flow in H1/14, increase expected for second half of the year Free cash flow in m Dividend volume in m Dividend ( /share) H1/13 H1/

29 H1/14 positively impacted by acquisitions in digital, organic growth and print disposals Revenues up 6.2%, EBITDA of 266m up 10.6% yoy Digital activities 65.2% of group EBITDA and 51.4% of revenues Net income of 816m due to print disposals (PY: 156m) 4. Classifieds with improved organic growth and 3 major acquisitions 5. Digital subscriber numbers continue to grow 6. Advertising development in Q2/14 supported by World Cup 7. Sale of minority stake in iproperty for 74m (effective Q3/14) 29

30 EBITDA and revenues up in line with expectations in m H1/14 yoy Q2/14 yoy Revenues 1, % % Circulation % % Advertising % % Other % % EBITDA % % Margin 18.5% +0.7pp 19.9% +0.0pp Restructuring Exp Launch Costs EBITDA ex. Restr./LC % % Margin 21.0% +0.9pp 22.4% -0.1pp Revenues up 6.2% yoy, adjusted for consolidation effects +3.3% Digital media driving growth in advertising revenues and overcompensating decline in print Restructuring expenses up in H1/14, expected to be significantly down yoy in H2/14 EBITDA up 10.6% yoy, adjusted for consolidation effects +4.1% 30

31 Cost development in line with revenues in m H1/14 yoy Q2/14 yoy Personnel % % Purchased goods and services % % Other operating % % Total Costs 1, % % Total costs up by 5.9% due to organic growth in digital and consolidation effects Adjusted for consolidation effects, total costs up by 3.4% Increase in personnel costs driven by build-up in digital 31

32 Paid Models with slight revenue and EBITDA growth and stable underlying development in m H1/14 yoy Q2/14 yoy Revenues % % thereof digital (reported) % % thereof digital (pro forma) % % Circulation % % Advertising % % Other % % EBITDA % % Margin 17.5% +0.5pp 18.6% +0.1pp Restructuring Exp Launch Costs EBITDA ex. Restr./LC % % Margin 20.3% -0.2pp 21.0% -1.3pp Share of digital revenues in segment almost 20% Business development significantly better in Paid Models National compared to International Circulation revenue decline adjusted for consolidation effects only -1.2% in H1/14, due to copy price increases and paid content revenues Positive effect from world cup for advertising in Q2/14 EBITDA up 6.1%, adjusted for restructuring costs and launch costs up 1.7% 32

33 Organic growth continues to drive Marketing Models in m H1/14 yoy Q2/14 yoy Revenues % % Revenues (pro forma) % % Advertising % % Other % % EBITDA* % % Margin 14.9% -0.8pp 15.9% -1.7pp Majority of advertising revenue increase driven by organic growth Other revenues adjusted for consolidation effects up 5.7% in H1/14 EBITDA up despite significant increase in launch costs Launch Costs EBITDA ex. LC % % Margin 16.7% +0.4pp 17.7% -0.5pp * Total EBITDA includes costs of 2.2m in H1/2014 and 1.8m in H1/2013 (thereof business development, M&A and other), not allocated to the two pillars. 33

34 Classified Ad Models with improved organic growth in m H1/14 yoy Q2/14 yoy Revenues % % Revenues (pro forma) % % Advertising % % Other % % EBITDA % % Margin 44.5% +3.5pp 45.7% +3.9pp Revenues up 15.0% yoy, ex consolidation effects 7.4% Organic growth in Q2/14 (9.4%) slightly up on Q1/14 (7.0%) EBITDA up due to increased revenues and significant margin expansion 34

35 Net income of 816m significantly up yoy due to print disposals in m H1/14 H1/13 Q2/14 Q2/13 Net income Net income discontinued operations eps discontinued operations (in ) 1) Net income continuing operations Non-recurring effects Effects of purchase price allocations Taxes attributable to these effects Adjusted net income Thereof attributable to non-controlling interests Adjusted net income attributable to shareholders of Axel Springer SE in Adjusted eps continuing operations 1) ) Based on weighted average number of shares outstanding in H1/2014: 98.9m. 35

36 Appendix

37 Paid Models National: Revenue growth / International: Stable EBITDA margin Paid Models National Paid Models International in m H1/14 yoy Q2/14 yoy H1/14 yoy Q2/14 yoy Revenues % % % % thereof digital (reported) % % % % thereof digital (pro forma) % % % % Circulation % % % % Advertising % % % % Other % % % % EBITDA % % % % Margin 19.4% +0.4pp 20.4% +0.4pp 11.6% +0.1pp 13.0% -1.4pp Restructuring Exp Launch Costs EBITDA ex. Restr./LC % % % % Margin 23.1% -0.4pp 23.4% -1.0pp 12.1% -0.9pp 13.8% -3.0pp 37

38 Reach Based Marketing with launch costs / Performance Marketing slightly improved Reach Based Marketing Performance Based Marketing in m H1/14 yoy Q2/14 yoy H1/14 yoy Q2/14 yoy Revenues % % % % Revenues (pro forma) % % % % Advertising % % % % Other % % % % EBITDA* % % % % Margin 35.1% -4.9pp 36.2% -9.0pp 4.6% +0.5pp 5.0% +1.1pp Launch Costs EBITDA ex. LC % % % % Margin 40.1% -1.5pp 41.1% -5.8pp 4.6% +0.5pp 5.0% +1.1pp * Total EBITDA includes costs of 2.2m in H1/2014 and 1.8m in H1/2013 (thereof business development, M&A and other), not allocated to the two pillars. 38

39 New segmentation reflects transition to digital Newspapers National Magazines National Print International Content portals & other digital media Digital Media Performance Marketing Axel Springer Digital Classifieds Services / Holding Old New Paid Models Marketing Models Classified Ad Models Services / Holding National Performance Marketing International Reach Based Marketing 39

40 Overview of assets in new segments Paid Models Marketing Models Classified Ad Models Services / Holding National BILD group WELT group Performance Marketing zanox Digital Window eprofessional Yad2 Real Estate SeLoger Immonet Immoweb Printing Distribution Axel Springer Media Impact 2) Holding functions International Switzerland France Russia Spain Ringier Axel Springer Media (Poland incl. Onet, Slovakia incl. Azet, Serbia, Hungary 1) ) Reach Based Marketing Idealo aufeminin kaufda/bonial Smarthouse finanzen.net Jobs StepStone Totaljobs Saongroup YourCareerGroup Jobsite 1) Cars LaCentrale Local meinestadt 1) Closing pending. 2) Previously in print segments. 40

41 Investor Relations contacts Claudia Thomé Co-Head of Investor Relations Phone: Mobile: Daniel Fard-Yazdani Co-Head of Investor Relations Phone: Mobile: Axel Springer SE: Axel-Springer-Str. 65, Berlin, Germany, Fax: