Buongiorno. Company Presentation. Buongiorno

Transcription

1 Company Presentation International Roadshow United States, May 22-31, 2006

2 B! in Short B! is a fast growing new media company, emerging as a global leader in the market of the mobile value added services. 2

3 B! Core Purpose To bring digital entertainment to everyone through innovation 3

4 Table of Contents Market Overview & B! Positioning Why B! Is Different B! Strategy & Financials B! Governance, Shareholding Structure & Stock Back-up 4

5 Bn Euro Mobile Value Added Services Global Market & Growth Drivers No. of global Mobile Users 2 bn 3 bn VAS ARPU (per active user/year) 50 EUR 40 EUR VAS Market CAGR % E 2007E 2008E 2009E 2010E % of VAS users on total mobile users (enlargement of age group using VAS) 15% 30% Mobile VAS Global Market - Sources: Ovum Research through internal estimates for Growth Drivers - Sources: Wireless Intelligence, Nokia, Mobile Operators report, internal analysis 5

6 The Mobile VAS Market Value Chain B! 6

7 Table of Contents Market Overview & B! Positioning Why B! Is Different B! Strategy & Financials B! Governance, Shareholding Structure & Stock Back-up 7

8 Why B! Is Different: Global Footprint! B! For-side Index Multimedia VeriSign Monstermob 3/4 per region (e.g. i-touch) 5/10 per country (e.g. Acotel, Zero9) Global Players Regional Players Local Players We see as an attractive play on the booming mobile content industry. BV is one of a small number of companies the others being VeriSign/Jamba, Monstermob, For-side and Index Corp. that can claim global footprint, WESTLB Jan 11, 2006 We note that successful European mobile content player has EBITDA margins in the 5-10% range, as the company has been heavily investing in new geographic markets and in building customer relationships, SG Cowen Apr 10,

9 Why B! Is Different: A Balanced Approach Through Products Portfolio Category B! Situation Current Perspective Infotainment and editorials Approx. 1/3 Alerts, Trivia, Text based magazines, WAP browsing Video based magazines, Mobile-specific TV formats, Java Applets Phone personalization and downloadable Approx. 1/3 Monophonic & Polyphonic Ring Tones, True tones Wallpapers, Logos, Java Games Video Tones, Full track downloads, 3D Games, Multiplayer Games Interaction Approx. 1/3 Sms Chat, Sms voting, Text based TV participation WAP Chat, Community services (e.g. dating), Photo and Video upload/sharing 9

10 Why B! Is Different: A Balanced Approach Through Distribution Channels Channel B! Situation B! SPLIT Q1 06 DIRECT 34% MEDIA 30% TELCO 36% 10

11 Where B! Stands Europe Leading position in more relevant markets LATAM US Asia and Russia Successful operations in Mexico with Televisa; extending to other Spanish speaking countries, with Televisa; tackling Brazil via collaboration with local groups (Telefonica and TIM) Successful direct approach mainly driven by on-line adv; TV launch after extending penetration (Sprint, Verizon, and Regional Carriers); initial Media/Telco business JV with Mitsui; Telcos/Media contracts in place in India, Thailand and Russia; direct approach in place in Russia; preparing launch in China 11

12 Why Going Global? Why Global? Cost advantage is highly scalable business Economies of experience Opportunity to optimize different market cycle across different geographies Financial market premium 2 bn Mobile Users in Sept 2005 NORTH AMERICA >200mn LATIN AMERICA >75mn WESTERN EUROPE >450mn RUSSIA Approx. 100mn AFRICA >75mn OTHER FAR EAST Approx. 500mn INDIA CHINA >50mn >300mn AUSTRALIA/ NEW ZEALAND Approx. 20mn B! current potential reach: Approx. 45% Goal by end of 2006: 60% Goal by 2010: 80% 12

13 Why A Balanced Approach? BUONGIORNO QUARTERLY REVENUES AND EBITDA TRENDS (*) Euro mn Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q Revenues Ebitda (GOM) * Starting with Q Results have been prepared in accordance with IAS/IFRS Results have been restated for comparison purposes in accordance with IAS/IFRS. 13

14 B! Unique Assets To Manage A Large And Complex Market Management Team & High Professional Global Team: International, high profile and high-motivated management team coming from International high level corporations >600 people >20 nationalities Spread all over the world Technology Platform: Technology infrastructure: 3 server farms, backbone internet connection, grid server architecture; 100 highly skilled people; Services for B! brands and >60 operators worldwide (system development, maintenance and 24x7 support to all services); WEB, Wap, , SMS & MMS; 100 active connections to mobile/landline operators and gateways; 250 mn/month delivered messages, 70 mn page/month (Web, WAP, voice portals), 625 mn objects (Full track music, ringtones, games, etc) delivered in 2005 and 295 mn in Q Consumer Oriented Approach: s Global Mobile Data research, globally run since 2002, sheds light into consumer understanding of such services and products; Presented annualy to key telco & media partners. Blinko Global Consumer Brand: Launched in Sept 2005 for B! direct sales channel in 14 countries; Extensive Mobile Data offering (from TXT trivia to Full-track download and video ringtones) in 8 languages; Unpararelled single-minded approach to the global data market; Sold in multiple channels: web, wap, TV, i-mode, 3G portal. 14

15 Table of Contents Market Overview & B! Positioning Why B! Is Different B! Strategy & Financials B! Governance, Shareholding Structure & Stock Back-up 15

16 B! Overall Strategy Focus on service management role Maintain balanced approach in terms of product mix and distribution mix Accelerate globalization B! quantitative goals: Significantly increase its global VAS market share, in terms of IAV* (from an estimated 1.9% in 2005 to approx 3.5% by 2010) Progressively drive its fixed costs down from 78% in 2005 to 56% of its IAV by 2010 * Industrial Added Value, Revenues minus Variable COGS and Marketing expenses 16

17 B! Industrial Added Value (IAV) B! REVENUES B! P&L REVENUES 100% VARIABLE COGS 35-40% MKTG COSTS 20-25% B! IAV IAV 35-45% FIXED COSTS EBITDA 17

18 Fixed Costs Trend vs IAV Mn Euro 60, ,0 40, ,0 20,0 10,0 0, Fixed Costs IAV 18

19 Q P&L Figures Consolidated P&L 000 Euro Q Q % Change Sales of Goods and Services 50,401 27, % Total Value of Production 50,638 28, % Gross Operating Margin 4,173 1, % Operating Profit Profit Before Taxation 3, % 2, % Consolidated Profit for the period 2, ,191% Consolidated Profit for the period (after Minority Interests) 2, ,207% 19

20 B! P&L Progression Mn Euro * 2005* Revenues EBITDA Net Result (11.0) (1.8) 5.2 * FY04 and FY05 results are based on the new IAS/IFRS Accounting Principles. 20

21 B! EBITDA Margin Progression Mn Euro 14,0 12,0 10,0 8,0 6,0 4,0 2,0 0,0 1,0% 5,5% 9,0% 0,5 4,5 12, ,0% 8,0% 6,0% 4,0% 2,0% 0,0% Ebitda (GOM ) Ebitda M argin (%) 21

22 Q Reclassified Consolidated Cash Flow Statement Reclassified Consolidated Cash Flow Statement 000 Euro Q FY 2005 Net Financial Position at Period Start (6,482) 3,359 Cash Flow from Ordinary Activities Change in Net Working Capital 3,442 (1,705) 10,185 (7,020) Cash Flow from Investing Activities 238 (28,564) Cash Flow from Financing Activities ,556 Other Changes in the Equity and Financial Situation That do not Entail Cash Flows 0 3 Net Financial Position at Period End (4,394) (6,482) 22

23 B! 2006 and Long Term Guidance Mn Euro Guidance Long Term Guidance Revenues Over 400 mn Euro in 2010 Industrial Added Value (IAV) CAGR IAV >20% Earning per Share (Outstanding shares) Euro CAGR EPS >50% Based on Q results, management expects B! will be able to exceed the top end of the ambitious guidance set for

24 Additional Elements Given the P&L goals seen above, B! expects to generate a strong free cash-flow in upcoming years, due to: Low CAPEX: in line with the recent past, yearly CAPEX can be expected in the Euro 2 to 3 mn/a year range (excluding M&A/financing related items) Huge tax shield: with about 200 mn Euro of cumulated tax carry forward losses in its key geographies, B! expects a very low effective tax rate in period of the plan Limited working capital requirements: The high growth of the revenues will imply some working capital absorption, that can be expected in some million Euro a year 24

25 Table of Contents Market Overview & B! Positioning Why B! Is Different B! Strategy & Financials B! Governance, Shareholding Structure & Stock Back-up 25

26 B! Governance Market friendly, transparent governance and communication approach Monistic System of Governance: no Statutory Auditors organism but an internal Supervisory Committee International, experienced Board of Directors, with a track record of fast, efficient decision process 9 members in the Board of Directors, 5 of them fitting the independence requirements 26

27 B! Shareholding Structure Reference shareholder stable since foundation Key managers were shareholders since foundation Extensive, in-the-money, Stock Option Plan Relevant Shareholders (>2%) No. of outstanding shares at April 28, 2006: 86,281,382 27

28 B! Stock According with the new equity markets segmentation of the Italian Stock Exchange (Borsa Italiana) in force of September , B! is listed on the MTAX* under the techstar segment. Sector Market Segment Ticker Symbol Isin Code Reuters Code Bloomberg Code Specialist Media MTAX - STAR BNG IT BNI.MI BNG IM RasBank No. of shares at April 28, 06 86,281,382 Share Par-Value Euro 0.26 each Share Price at May 15, 06 Euro 4.92 Capitalization at May 15, 06 Euro 425 mn Average Daily Volume (12M) 742,330 Turnover Velocity Approx. 1% Analysts RasBank, Banca Imi, Intermonte, Banca Akros, Banca Aletti, ML, WestLB *The Nuovo Mercato has been renamed MTAX and has acquired the same structure in terms of market segments blue-chip, STAR and Standard as the Electronic Share Market (MTA). Blue-chip, STAR and Standard segments share the same requirements for admission and continued inclusion and the same trading procedures both for MTA and MTAX. Among the requirements to be a STAR company: communication transaparency, corporate governance, high liquidity of the stock. For more information: 28

29 Concluding: Investing Highlights One of the fastest independent growing companies in one of the fastest growing markets, with a clear, value adding oriented, strategy A real international footprint International scalability of the business A broad and balanced content and application portfolio A strong and balanced distribution model (Direct, Telco and Media) An organic growth strategy integrated with a focused M&A approach and strong post merger management capabilities (MyAlert, Vitaminic, Gsmbox, DioraNews, Tutch and Freever) Market friendly company, with stable governance and management team A credible plan to increase EPS by % in >50% CAGR in the period! 29

30 Table of Contents Market Overview & B! Positioning Why B! Is Different B! Strategy & Financials B! Governance, Shareholding Structure & Stock Back-up 30

31 FY P&L Figures Consolidated P&L 000 Euro FY 2005* FY 2004* Change Sales of Goods and Services 135,819 81,236 54,583 Total Value of Production 138,015 84,214 53,801 Gross Operating Margin Operating Profit Profit Before Taxation Consolidated Profit for the period 12,276 7,758 6,418 5,164 4,453 (780) (1,435) (1,826) 7,823 8,538 7,852 6,991 * FY 2005 Results have been prepared in accordance with IAS/IFRS. FY2004 Results have been restated for comparison purposes in accordance with IAS/IFRS. 31

32 FY Reclassified Consolidated Cash Flow Statement Reclassified Consolidated Cash Flow Statement 000 Euro Year 2005* Year 2004* Change Net Financial Position at Period Start 3,359 (4,470) 7,829 Cash Flow from Ordinary Activities 10,185 1,441 8,744 Change in Net Working Capital (7,020) 4,328 (11,348) Cash Flow from Investing Activities (28,564) (5,976) (22,588) Cash Flow from Financing Activities 15,556 8,013 7,543 Other Changes in the Equity and Financial Situation That do not Entail Cash Flows 3 23 (19) Net Financial Position at Period End (6,482) 3,359 (9,841) FY 2005 Capex: Ordinary Capex mn Euro Extraordinary Capex mn Euro Net Worth: 51.4 mn Euro Net Financial Position: -6.5 mn Euro, thanks to over Euro 10 million in operating Free Cash Flow generated in Q4 32 * FY 2005 Results have been prepared in accordance with IAS/IFRS. FY2004 Results have been restated for comparison purposes in accordance with IAS/IFRS.

33 Safe - harbour Provisions This presentation contains statements that are neither reported financial results nor other historical information. These statements are forwardlooking statements. These forward-looking statements rely on a number of assumptions and are subject to a number of risks and uncertainties, many of which are outside the control of SpA, that could cause actual results to differ materially from those expressed in or implied by such statements, such as future market conditions, currency fluctuations, the behavior of other market participants and the actions of governmental and state regulators. 33

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