Annual Press Conference. Unterföhring, March 4, 2009

Transcription

1 Annual Press Conference Unterföhring, March 4,

2 Overview 2008 Thomas Ebeling Financials 2008 Axel Salzmann German-speaking Free TV Andreas Bartl Sales / TV ad market Klaus-Peter Schulz International business Patrick Tillieux New Media / Diversification Dr. Marcus Englert 2

3 Fiscal 2008 at a glance: 2008 was a challenging year for ProSiebenSat.1 Recurring EBITDA reached EUR 675m, Group revenues amounted EUR 3.1bn Revenues and earnings decline mainly caused by sales model failure in Germany Worsening of economic environment > In Q4 International Free TV also impacted by economic slowdown Steps to ensure profitability initiated: Cost-cutting measures took effect in Q Efficiency measures initiated early in the year gave us a head start to face the recession intensifying the second-half 2008 Macroeconomic uncertainties 2009 budgets adapted to difficult market situation Decisive steps for optimizing the set-up of the German Group initiated Figures 2008 preliminary and unaudited. Proforma consolidation = full-year consolidation of SBS for 12 months / Jan-Dec 2007 (acquisition in July 2007). 3

4 Fiscal 2008 at a glance: Important strategic milestones achieved, major steps to increase our long-term competitive power initiated Audience shares significantly up in 2008, in Germany as well as in large part of international footprint > New German Free TV organization the basis for further ratings provides improvements and efficiency gains New German ad sales model for 2009 with positive market feedback > ProSiebenSat.1 regained 3.2 percentage points of the gross advertising market share in Germany so far Integrated sales house ready for future advertising market > Sales operations adapted to the market s needs: SevenOne Media (TV) and SevenOne Interactive (New Media) will be combined in a new structure Source: TV ad spends (gross): Nielsen Media Research; as at 02/22/09. 4

5 Fiscal 2008 at a glance: Important strategic milestones achieved, major steps to increase our long-term competitive power initiated No.2 online-network in Germany with 19m unique users: > Strong online portfolio with top position in German market further expanded through acquisitions and organic growth No.1 provider of Video on Demand in Germany > maxdome is the leading video-on-demand portal in Germany with 18,000 titles No.2 radio network in Europe > International radio business strengthened by acquiring smaller competitors and by combining the acquired assets with our existing operations 5

6 Overview 2008 Thomas Ebeling Financials 2008 Axel Salzmann German-speaking Free TV Andreas Bartl Sales / TV ad market Klaus-Peter Schulz International business Patrick Tillieux New Media / Diversification Dr. Marcus Englert 6

7 Q4 2008: Cost saving measures take effect Consolidated Revenues In EUR m % Recurring EBITDA In EUR m % Q Q Q Q Recurring EBITDA: EBITDA before non-recurring (exceptional) items. Figures 2008 preliminary and unaudited. Figures incl. CMore: Deconsolidation in December

8 Q4 2008: Total cost breakdown Recurring expenses before D&A declined significantly As a result of reduced advertising market forecasts for 2009 an impairment loss against SBS goodwill up to EUR 180.0m will be recognized. This non-cash impairment charge is included in D&A of EUR 246.4m. Recurring costs excl. D&A Non-recurring expenses % Depreciation & amortization* incl. SBS impairment of EUR 180.0m Q Q Q Q Q Q In EUR m. Figures 2008 preliminary and unaudited. Figures incl. CMore: Deconsolidation in December * Thereof purchase price allocation: EUR 39.2m in Q4 2007, EUR 18.5m in Q

9 FY 2008: Group s revenues and earnings decrease mainly because of shortfall in German TV ad sales Consolidated Revenues In EUR m , , % 3,054.2 Recurring EBITDA In EUR m % Legal 2007 Proforma Legal 2007 Proforma Figures 2008 preliminary and unaudited. Proforma consolidation = full-year consolidation of SBS for 12 months / Jan-Dec 2007 (acquisition in July 2007). Deconsolidation of C More in December 2008: 2008 Revenue contribution EUR 132.0m (PF 2007: EUR 146.0m), 2008 recurring EBITDA contribution EUR 16.4m (PF 2007: 9.7m). Recurring EBITDA: EBITDA before non-recurring (exceptional) items. Figures 2008 preliminary and unaudited. 9

10 FY 2008: Total cost breakdown Recurring Costs exclusive D&A Non-recurring expenses , , % 2,413.1 Depreciation & amortization* incl. SBS impairment of EUR 180.0m Legal PF , Legal 2007 Proforma Legal 2007 PF In EUR m. Figures 2008 preliminary and unaudited. Proforma: Consolidation of SBS since January * Thereof purchase price allocation: EUR 82.8m in 2007, EUR 70.4m in

11 EBITDA reconciliation proforma consolidation 2007 Non-recurring items in 2008: Non-recurring costs (EUR 86.1m) mainly resulted from efficiency measures such as the Sat.1 relocation, the IT-outsourcing and further integration measures. In Euro m Recurring EBITDA Non-recurring items EBITDA Gains from the sale of C More and BTI added EUR 24.0m to non-recurring income. Non-recurring items in 2007: One-off charge of EUR 120.0m resulting from a settlement with Germany s Federal Cartel Office. Proforma: Consolidation of SBS since January

12 Net income reconciliation 2007 legal consolidation Net income reflects a non-cash goodwill impairment charge of SBS of EUR 180.0m Furthermore the decline of financial result has significant impact on net income 2008: Financial result declined due to higher net interest charges of EUR 255.4m (+ EUR 139.7m) mainly due to the full-year effect of SBS acquisition At the same time, financial result declined because of non-cash currency valuation differences In Euro m Recurring EBITDA Non-recurring result EBITDA Depreciation and amortization Operating result Financial result Pre-tax profit Taxes Net income* Figures 2008 preliminary and unaudited. Legal consolidation of SBS since July *Before minority interests. 12

13 Debt facilities financing leaves sufficient headroom for further operational and strategic expansion Debt facilities In EUR m ,800 Term Loan B 1,800 Term Loan C EUR 4.2bn senior secured credit facilities: > EUR 3.6bn term loans with bullet repayment in 2014/15 > EUR 600m revolving credit facility (maturity 2014) Net debt as per December 31, 2008 was EUR 3,407m (12/31/07: EUR 3,328m) > Leverage (net debt/recurring EBITDA) is 5.05x (12/31/07: 4.24x) RCF* 31 Mortgage July 2014 July 2015 July /2021 Cash flow drivers in 2008 > EUR 120m cartel fine paid > EUR 270m dividend payment in June 2008 > c. EUR 320m C More gross proceeds in Dec 2008 Figures 2008 preliminary and unaudited. Legal consolidation of SBS since July *Revolving Credit Facility. 13

14 Revenue split by region and business unit Revenues by business unit In percent Free TV unit 82.9% (2007: 83.2) Revenues by region In percent German-speaking Europe 64.8% (2007: 66.8) Diversification unit 17.1% (2007: 16.8) Nordic 16.1% (2007: 15.4) CEE 5.4% (2007: 4.8) The Netherlands / Belgium* 13.7% (2007: 13.0) Figures 2008 preliminary and unaudited. Proforma consolidation of SBS since January *Flanders. 14

15 Free TV revenues by quarter Revenues In EUR m % % % % % % % % Q1 Germanspeaking Q1 International Q2 Germanspeaking Q2 International Q3 Germanspeaking Q3 International Q4 Germanspeaking Q4 International Figures 2008 preliminary and unaudited. Proforma consolidation of International Free TV business (SBS) since January

16 German-speaking Free TV segment 2007 EUR m 2008 EUR m Change In percent External revenues 1, , Recurring EBITDA EBITDA Revenue decline driven by effects of ad sales model introduction, furthermore difficult market situation in the second half-year causes cut in TV advertising investments > After a good start into the second half-year, trading situation deteriorated Lower costs due to optimized programming expenses Figures 2008 preliminary and unaudited. Recurring EBITDA: EBITDA before non-recurring (exceptional) items. 16

17 International Free TV segment 2007 EUR m 2008 EUR m Change In percent External revenues Recurring EBITDA EBITDA Revenues in the International Free TV business slightly up > Solid growth in the first nine months of 2008, worsening economic environment affected Q4 results Start-up costs for new stations and higher programming expenses caused recurring EBITDA decline > EBITDA impacted by positive one-time effects resulting from the sale of CMore and BTI Figures 2008 preliminary and unaudited. Proforma consolidation of SBS since January Recurring EBITDA: EBITDA before non-recurring (exceptional) items. 17

18 Diversification segment 2007 EUR m 2008 EUR m Change In percent External revenues thereof C More /- Recurring EBITDA thereof C More /- EBITDA Revenue decline mainly due to lower Call TV revenues of 9Live in Germany Deconsolidation of Pay TV business C More in December 2008 Online business and international radio activities remained robust Music business successfully expanded Figures 2008 preliminary and unaudited. Proforma consolidation of SBS since January Recurring EBITDA: EBITDA before non-recurring (exceptional) items. 18

19 Summary Good liquidity Sufficient headroom for further expansion. Our investments will continue to focus on strong programming: > We have to improve our cost structure without affecting our audience shares budgets adapted to difficult market situation Due to worsening economic conditions we have taken actions to protect profitability: > Additional cost reductions of EUR 100m compared to Market decline across Europe is reflected in our 2009 budgets. Our reduced dividend proposal reflects market conditions and 2008 performance Dividend proposal of the management to pay EUR 0.02 per preference share. No dividend payment to ordinary shares. AGM will take decision. 19

20 Overview 2008 Thomas Ebeling Financials 2008 Axel Salzmann German-speaking Free TV Andreas Bartl Sales / TV ad market Klaus-Peter Schulz International business Patrick Tillieux New Media / Diversification Dr. Marcus Englert 20

21 German Free TV business ratings improved in 2008 in spite of competitive pressure in sporting year 29.4 percent audience share is well above competitor RTL Group TV coverage of Olympic Games and Euro 2008 on the public stations ProSiebenSat.1 would have reached 29.8 percent audience share adjusted for sports events Audience shares in Germany In percent N24 kabel eins n-tv Super RTL Vox Sat.1 RTL Pro Sieben ZDF ARD ProSiebenSat.1 Media AG RTL Group RTLII Public service stations Basis: All German TV households (Germany + EU), Mo.-Sun., 03:00-03:00h, viewers years. Source: AGF/GfK Fernsehforschung / pc#tv aktuell / SevenOne Media Marketing & Research. 21

22 German Free TV business German Free TV stations performed very well in the audience market in Q Audience shares In percent Group ratings up from 28.7% to 29.7% Sat.1 is stable at around 11 percent ProSieben moved from strength to strength with rating increase from 11.6 to 12.0 percent kabel eins keeps ratings stable N24 stays very successful > In fall 2008 the news channel changed its technology and now operates on a state-of-the-art multi-media platform 0 Sat.1 ProSieben kabel eins N24 Q Q Content offensive worked successfully in 2008 Basis: All German TV households (Germany + EU), Mo.-Sun., 03:00-03:00h, viewers aged Source: AGF/GfK Fernsehforschung / pc#tv aktuell / SevenOne Media Marketing & Research. 22

23 German Free TV business - Leading TV brands through best-in-class programming Five of seven Hollywood studios supply our channels exclusively with movies and series The three most successful US series of the current season will run on our stations Legendary football show ran will return to Sat.1 in 2009 with the best of European football by showing games of the UEFA Champion League and the UEFA Cup live Successful in-house productions like Germany s next Topmodel or Schlag den Raab return to the screen Back-to-back productions make use of synergies and potential in cost reductions > With RedSeven, founded in May 2008, we have our own production subsidiary specializing in non-fictional content Investments will continue to focus on strong programming used as efficiently as possible 23

24 Setting the course for the future in Germany - a centralized organization of the German TV stations in Munich Optimizing the set-up of the German TV stations: German TV stations Sat.1, ProSieben and kabel eins under one roof in a new structure in Munich N24 and Sat.1 editorial departments stay in Berlin Enhance efficiency and lower costs by centralizing processes Create synergies through comprehensive use of functions Safeguard success with audiences in the long run > New set up to be done by July

25 Setting the course for the future - a totally new technological platform for the integrated Group One of our strategic goals is the modernization of the technological infrastucture: Steps to new technologies in 2008: N24 with a new multi-media platform ProSiebenSat.1 sets up new European play-out center in Munich IT outsourcing agreement with IBM signed Advantages of the new technologies: Digitalization of processes and workflows lead to more efficiency Content can be prepared simultaneously for many platforms Higher quality of broadcast material 25

26 Overview 2008 Thomas Ebeling Financials 2008 Axel Salzmann German-speaking Free TV Andreas Bartl Sales / TV ad market Klaus-Peter Schulz International business Patrick Tillieux New Media / Diversification Dr. Marcus Englert 26

27 German TV advertising market / Share of advertising by years SevenOne Media YTD again on 2007 level IP with heavy losses in 2009 / Other channels still growing Share of advertising (Gross) in percent Others Public stations El Cartel IP SevenOne Media Year 07 Year 08 YTD 09 Source: Nielsen Media Research; YTD 09:

28 Q / total 2008: German gross advertising market 2008 Television benefits from an extraordinary high share in Q4 Internet also above yearly average / all other media with weak Q4 Gross ad investments Q In percent Gross ad investments 2008 In percent Q4 2008: EUR 6.65bn Total 2008: EUR 22.37m TV Newspapers Magazines Radio Outdoor Internet Cinema Source: Nielsen Media Research. 28

29 Sales 2009 Short term: regain market share and avoid further price erosion Balanced market approach between clients and agencies Strategic outlook: > Audiovisual content is key for brand communication > Service the total brand value chain One face to the customer Integration of SevenOne Media and SevenOne Interactive into a 360 sales house 29

30 Overview 2008 Thomas Ebeling Financials 2008 Axel Salzmann German-speaking Free TV Andreas Bartl Sales / TV ad market Klaus-Peter Schulz International business Patrick Tillieux New Media / Diversification Dr. Marcus Englert 30

31 International Free TV business 2008 Remarkable growth in the Netherlands Stable Scandinavian performances with a successful development of 2nd channels Weaker shares in Hungary and Romania due to increased market fragmentation Audience shares In percent Benelux Scandinavia CEE Netherlands Belgium (Flanders) Sweden Norway Denmark Hungary Romania Basis: All local national households as used in local comparisons, 20-49y or 15-44y or15-50y or18-49y, Mo.-Sun., 02:00-02:00h Source: SKO/GfK Intomart; CIM/GfK Audimetrie; MMS/AGB Nielsen; TNS-Gallup; AGB Nielsen; ARMA/TNS-AGB International; Advantedge. Note: Sweden excludes VoiceTV Sweden 31

32 International Free TV business 2009 finds good ground on good 2008 performances Multi-channel is driving force in Benelux and Scandi, but still missing in CEE Distribution revenues represent 25% of total revenues in Scandi NL B S N DK HU RO Sustained excellent multi-channel performance of all three stations Topline growth in 2008 despite abandonment of Call TV due to new laws VT4 benefiting from EuroCup in nd channel VIJFtv: continued growth despite fierce competition main station K5 still no.2 commercial station in market 2nd channel K9 with 2.5 years of existence developing well main station TV Norge facing extended distribution of competitor TV3 (MTG) successful launch of 2nd channel FEM, reaching 4.4% in its target group after 1 year excellent viewing performance in 2008 repositioning of 3rd channel 6 eren TV2 underwent extensive restructuring in 2008 good stand-alone performance in an increasing fragmented market Prima TV challenged by strong multi-channel competitors good synergies with our very strong radio Kiss FM (no.1 in market) 32

33 International Diversification growing radio business ProSiebenSat.1 radio network is no.2 in Europe Strong business in Romania with Kiss FM (no.1 network) Nordic operations reinforced by acquisitions in Sweden, Norway and Denmark Strong business with Kiss FM in Romania and good organic development in Bulgaria Expansion in Northern Europe through acquisitions in Norway, Denmark and Sweden: > March 2008: acquisition of Kanal24 and combination with SBS Radio Norway to form Radio Norge. Increasing market share from 19% to 33%. > July 2008: acquisition of TV2 radio and combination with SBS Radio Denmark. Increasing market share from 13% to 30%. > Dec 2008: acquisition of SRU and combination with SBS Radio Sweden. Increasing market share from 39% to 50%. 33

34 International Diversification non-core activities Nordic Pay TV business CMore sold Veronica Publishing stays in the Group Veronica Magazine remains a highly profitable operation Sale of CMore closed in December 2008 Leading Pay TV operation in Northern Europe Clearly identified as non-core business for ProSiebenSat.1 Sale agreement signed with Swedish TV4/Bonnier in June 2008 Sale closed in December 2008 for about EUR 320m gross proceeds Veronica Publishing remains in the group No.1 magazine in the Netherlands with weekly circulation of about 1m Clearly identified as non-core business for ProSiebenSat.1 Sale considered, but abandoned due to financial crisis Focus back on operations 34

35 Overview 2008 Thomas Ebeling Financials 2008 Axel Salzmann German-speaking Free TV Andreas Bartl Sales / TV ad market Klaus-Peter Schulz International business Patrick Tillieux New Media / Diversification Dr. Marcus Englert 35

36 Diversification Germany - ProSiebenSat.1 is no. 2 online marketer Through strategic investments and the expansion of the internet world, ProSiebenSat.1 has become a leading online player in Germany Top 10 marketers: Ranking in terms of Unique Users per month in m, users aged 14+ United Internet Media SevenOne Interactive InteractiveMedia TOMORROW FOCUS IP Deutschland AdLINK Media Germany ProSiebenSat.1 s core online portfolio is no.2 among online marketers ad pepper media & mediasquares Plattform-A Media andno.1 in the young target audience of years Yahoo! Deutschland GWP media marketing Source: AGOF Internet facts III/2008 (survey period: Q3/2008 most current survey). 36

37 Diversification through new revenue sources - Online portfolio strengthened in 2008 Online Networld: video strategy pays off VoD: maxdome is the leading video-on-demand portal in Germany with 18,000 titles and approx. 200,000 active users TV sites: since March 2008, full-length series of successful in-house production TV formats are available online for streaming Podcasts: more than 56m downloads in 2008 MyVideo: Second largest video community in Germany behind YouTube. 2009: New focus on premium content, relaunch on March 6 Continued extension of the ProSiebenSat.1 Networld fem.com: Acquisition of 100% in 2008, quickly established as one of the Top 3 among female online sites in Germany fem. combines a branded network of online sites for women and a state-of- the-art content portal 37

38 Diversification through new revenue sources - Music and Gaming business expanded in 2008 ProSiebenSat.1 music label Starwatch Music works successfully Publications of famous artists like Udo Lindenberg, Westernhagen and Chris de Burgh made 2008 very favourable New co-operations with major labels like Universal Music and Sony BMG guarantee further highlights of new releases (e.g. Adoro, a-ha) ProSiebenSat.1 games business grows fast Three-digit growth in the games segment in 2008 Publisher for Nintendo, Sony and PC (e.g. Clever, Quiz Taxi ) 2009: More than 20 releases worldwide, e.g. Germany s next Topmodel, Galileo, Anna und die Liebe and Oktoberfest 38

39 9live well positioned as market leader in the German market Licence agency of ProSiebenSat.1 concluded Disney agreement Strong start of 9Live core business Difficult summer (due to Soccer Championship and Olympic Games) was followed by stabilization trend in Q4/08 Optimized monetarisation of program grid through different interactive business models Successful extension of 9Live Call TV business into former SBS markets with positive synergy effects for the ProSiebenSat.1 Group Comprehensive licence cooperation agreement with Disney MM MerchandisingMedia secures the pan-european merchandising representations rights of globally successful US series Main Topics: Desperate Housewives, LOST and Grey s Anatomy 39

40 Financials 2008 Axel Salzmann German-speaking Free TV Andreas Bartl Sales / TV ad market Klaus-Peter Schulz International business Patrick Tillieux New Media / Diversification Dr. Marcus Englert Outlook

41 2009 will also be a year of challenges but ProSiebenSat.1 is prepared for this situation Audience share Focus on strong programming to ensure our competitive power used as efficiently as possible. Advertising share Significant improvement in core market Germany. Advertising market Recession reflected in our 2009 budget. January and February data show that our sales model is competitive again. Financials Manage financial targets through pro-active cost and cash-flow management. Reduced dividend payment. 41

42 Annual Press Conference March 4,

43 Disclaimer This presentation contains forward looking statements regarding ProSiebenSat.1 Media AG ( ProSieben-Sat.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, express 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. 43

44 ProSiebenSat.1 Media AG Corporate Office Medienallee 7 D Unterföhring Tel. +49/89/