Solocal Group · EURONEXT:LOCAL

Solocal — Investor Presentation (September 2013)

36 slides from Solocal's investor presentation, September 2013

  1. Slide 1: Investor Presentation September 2013

    INVESTOR PRESENTATION SEPTEMBER 2013

  2. Slide 2: Disclaimer

    Disclaimer This document contains forward-looking statements. Although Solocal Group believes its expectations are based on reasonable assumptions, these statements are subject to numerous risks and uncertainties. Important factors that could cause actual results to differ materially from the result

  3. Slide 3: Solocal Group brands

    So GROUP mappy “people idGal Aree | Qmbavche.com Kettravo.com CHRONORESTO @ Zoom Sobcal CVs s@rcrierpv ~RUMS HORYZON MEDIA leadformance4 (Q0Q) (ecius

  4. Slide 4: General Highlights

    Sobcal GROUP : GENERAL HIGHLIGHTS

  5. Slide 5: Highlights

    Highlights Debt refinancing and priority given to deleveraging Shareholder structure and governance evolution Business resilience in an environment with stronger headwinds Successful Digital transformation with 58% of revenues from Internet, confirming our Group strengths compared to Directories

  6. Slide 6: Refinancing and priority given to deleveraging

    Refinancing and priority given to deleveraging  Refinancing concluded end 2012 thanks to an almost unanimous agreement from lenders to extend debt maturity to September 2015  Debt reduction initiated : €417 M repaid in 2012 and €263 M to be repaid by April 2015  Confirmed commitment to suspend di

  7. Slide 7: Current shareholder structure

    Current shareholder structure Pre-restructuring of MDH  Financial restructuring agreement announced by Médiannuaire Holding ("MDH") on December 12, 2012 and completed on March 27, 2013 MDH 45%  Reduction of MDH participation from 55% to Float & employees 55% 19% and entry of Cerberus in MDH (at 75

  8. Slide 8: A Board of Directors in compliance with best corporate governance practices

    A Board of Directors in compliance with best corporate governance practices Previous composition 2 Solocal Group members of whom Jean-Pierre Remy, CEO 3 independent  Reorganization of the Board of Directors in members 18% order to take into account the changes in the 27% shareholding structure 6 KK

  9. Slide 9: A Successful Digital Transformation

    A SUCCESSFUL DIGITAL TRANSFORMATION

  10. Slide 10: Solocal Group, leader in local communication

    Solocal Group, leader in local communication Company profile & key 2012 figures 1 Strong digital business 2 #1 local Internet player in France €1.07 bn revenues and €464.5 M GOM Top 10 web & mobile reach (44%) #1 in local mobile 58% of Digital revenues, growth of +8.3% 650k clients ~30% share

  11. Slide 11: Online growth accelerated by new services

    Online growth accelerated by new services Incremental Online revenues generated since 2007 Double-digit online growth CAGR1 Online 2012 vs 2007 €623 M Transactional New services more +10.5% specialised by Websites / Adcontent market segments Display €380 M Mobile Enhanced user experience +€206 M n

  12. Slide 12: A transformation to digital, unique in the Directory space

    A transformation to digital, unique in the Directory space Reach Data FY2012 Revenues Change Digital in % Fixed Internet -3% 58% 46% -8% 53% ND -17% 33% 32% 2 -18% 27% 28% 1 -13% 30% 8% 2 -14% 29% 9% -12% 22% 1% 1 -18% 18% 8% Sources : Annual reports, BIA Kelsey 1Online weight 2011 2Reach average fr

  13. Slide 13: An Online strategy built on contents, medias and local communication expertise

    An Online strategy built on contents, medias and local communication expertise ~700 000 advertisers Leading brands, 46% reach 1 2 Listing & Display mobile and Local Digital fixed Content Media Websites & Digital marketing 3 FaceBook Advice in + Partnerships Pages communication 2 300 conseillers en c

  14. Slide 14: Launch of Digital 2015 program to achieve the digital transformation

    Launch of « DIGITAL 2015 » program to achieve the digital transformation ACCELERATE OUR ONLINE GROWTH by specialising our offers, focusing on our clients’ needs by business category and developing new services to support them in digital marketing ENHANCE THE EFFICIENCY OF OUR MEDIAS, FIXED AND MOB

  15. Slide 15: Organisation around 5 business categories

    Organisation around 5 business categories RETAIL SERVICE HOME PUBLIC Hotels Real estate B2B Health Home repair Restaurants Cars Legal Medias & brands  ~210M revenues  ~230M revenues  ~330M revenues  ~165M revenues  ~65M revenues  215k clients  115k clients  180k clients  80k clients  60k c

  16. Slide 16: Digital 2015: strong mobilisation and key projects

    « Digital 2015 » : strong mobilisation and 50 key projects Values / Digital All teams mobilised on 50 projects IT KPIs Management Talents aiming to drive Online growth ■ Customer Customer experience - Sales and marketing specialisation in 5 Solocal Business Impact Business Units - Sales tools effect

  17. Slide 17: H1 2013 Highlights and Results

    H1 2013 HIGHLIGHTS AND RESULTS

  18. Slide 18: 1st half 2013 highlights

    1st half 2013 highlights Temporary acceleration of the decrease in revenues  Decline of 4.7% in H1 2013 revenues in the strongly deteriorated advertising market 1  Printed directories declining by 14.3% in H1 2013  Weak growth of +2.4% in Internet business, heavily impacted by the sharp downturn

  19. Slide 19: Group revenues -4.7% in a depressed economic and advertising environment

    Group revenues -4.7% in a depressed economic and advertising environment Group revenues of €500.3 M in H1 2013, down -4,7%  Depressed advertising market1,  Decrease of -4.3% without Editus  Printed directories: 35% of revenues (39% in Q2), contraction of -14.3%  Internet: 63% of revenues, weak g

  20. Slide 20: Trend in Printed directories

    Trend in Printed directories Controlled decrease of revenues Good resistance of margin rate Revenues in million of euros €202.4 M €173.5 M -14.3% In million 250 150 46.2% 46.0% euros 1.6 200 -0.2 pt 0.0 38.8 100 150 32.9 -15.1% 93.5 100 79.8 162.0 50 140.5 50 -13.3% 0 0 H1 2012 H1 2013 H1 2012 H1 20

  21. Slide 21: Trend in Internet

    Trend in Internet Weak Internet growth Sharp Display slowdown mainly impacted by Display +17.8% Revenues in million of euros €308.5 M €316.0 M +2.4% +10.2% 350 +11.2% +8.7% +9.2% 300 +9.0% 82.5 79.5 -3.6% +7.9% +8.8% +5.7% +5.4% 250 +3.9% 200 +5.9% +5.3% +4.3% 150 +3.3% +1.6% 226.0 236.5 +4.6% 100 5

  22. Slide 22: Strong decrease of Display

    Strong decrease of Display Very strong deterioration of Display revenues growth Strong business deterioration up to the end of May 2013  Very high sensitivity to macroeconomics  Substitution by concurrent offers (TV, +22% performance-based search) and weak +17% presence on video +14%  Weak level

  23. Slide 23: Websites and digital marketing growth

    Websites and digital marketing growth Number of websites managed* by Solocal Group (in thousand) Websites  Responsive web design native for all our websites (fixed, mobile, tablet) 128.4  Verticalisation of websites +13k websites 115.3 • Look and Feel customized by sector 27.8 24.8 • Transactional

  24. Slide 24: GOM of 215.5 million euros, 43.1% of Group revenues

    GOM of 215.5 million euros, 43.1% of Group revenues Gross operating margin by segment In million euros H1 2013 H1 2012 Change Group gross operating margin 215.5 232.1 -7.2% as % of Group revenues 43.1% 44.2% -110 bps Internet 132.7 134.1 -1.0% as % of Internet revenues 42.0% 43.5% -150 bps Printed d

  25. Slide 25: Gross operating margin decreased by -7.2%

    Gross operating margin decreased by -7.2% Change in consolidated gross operating margin (GOM) in million euros 232.1 2.6 215.5 7.2 (0.7) (1.1) (24.7) GOM H1 2012 Revenues Paper Other external Sales personnel Other personnel GOM H1 2013 Print expenses expenses expenses Distribution Change -4.7% -24.3

  26. Slide 26: Underlying GOM margin stable in H1 2013

    Underlying GOM margin stable in H1 2013 H1 2013 H1 2012 Change Reported gross operating margin (€M) 215.5 232.1 -7.2% - Expensing of fixed costs of the sales force -3.0 - 2008 and 2009 Investment Tax Credit -2.2 accounted in 2012 Underlying gross operating margin (€M) 215.5 226.9 -5.0% Underlying GO

  27. Slide 27: From gross operating margin to consolidated income

    Net financial income stabilisation, increase of amortisation charges Corporate income tax rate impacted by year end 2012 increases From gross operating margin to consolidated income In million euros H1 2013 H1 2012 Change Gross operating margin 215.5 232.1 -7.2% Legal employee profit sharing (7.0) (

  28. Slide 28: Net cash flow: €95 M as of 1st half 2013

    Net cash flow: €95 M as of 1st half 2013 Net cash flow as of 30 June 2013 (in million euros) 216 (22) (71) (48) 20 95 (81) 14 GOM Capex Net Tax Other Net cash Decrease in ∆ net cash H1 2013 financial operational flow borrowings H1 2013 income* charges* H1 2013 (RCF1&3) and other *Of which € 10 M of

  29. Slide 29: Continued reduction of indebtedness

    Continued reduction of indebtedness Net debt* (in million euros) 1,793 1,770 1,742 1,684 1,629 06/30/2012 09/30/2012 12/31/2012 03/31/2013 06/30/2013 * Net financial debt: total gross financial debt plus or minus the fair value of derivative asset and liability hedging instruments and minus cash and

  30. Slide 30: Financial structure and debt maturity profile as of 30 June 2013

    Financial structure and debt maturity profile as of 30st June 2013 2013 2014 2015 2018 Total Marge (bps) / Size (€M) Rate (%) 71 M€ 84 M€ 1,213 M€ 350 M€ 1,718 M€ Tranche A1 49.6 175 Tranche A3 962.0 400 Tranche A5 356.4 360 Senior 289 secured RCF 1* - 175 notes A5 RCF 3* - 360 Total bank debt 1,368

  31. Slide 31: Compliance with covenants

    Compliance with covenants Financial leverage* 9% Interest coverage 25% 4.3x 4.3x 4.0x 4.0x 4.0x 4.06x 4.00x 3.97x 3.92x 3.75x 3.0x 3.0x 3.0x 3.0x 3.0x 3.66x 3.65x 3.71x 3.62x 3.63x 06/30/12 09/30/12 12/31/12 03/31/13 06/30/13 06/30/12 09/30/12 12/31/12 03/31/13 06/30/13 Net debt over GOM Maximum all

  32. Slide 32: Guidance 2013

    Guidance 2013 The Group maintains its 2013 objectives at the low end of the range in view of the further deterioration in the advertising market in France: REVENUE DECREASE BETWEEN -5% AND -3% 2013 GOM BETWEEN 425 AND 445 MILLION EUROS Confirmation of the priority given to REDUCING INDEBTEDNESS S

  33. Slide 33: Questions & Answers

    Sobcal GROUP : QUESTIONS & ANSWERS

  34. Slide 34: Glossary

    Sobcal GROUP : GLOSSARY

  35. Slide 35: Glossary – Operating P&L

    Glossary – Operating P&L Group Digital revenues:  Total of Internet revenues from PagesJaunes (pagesjaunes.fr, annoncesjaunes.fr, pagespro.com, websites and mobile Internet) and Internet revenues from all other subsidiaries in the Group Net external charges:  Include external purchases: primarily

  36. Slide 36: Glossary – Financial structure

    Glossary – Financial structure Net financial debt:  Total gross financial debt plus or minus the fair value of derivative asset or liability hedging instruments and minus cash and cash equivalents Ratio of net debt to GOM:  As defined in the agreement concluded with the financial establishments, i

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