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Vivendi — Debt Investor Presentation (March 2010)
51 slides from Vivendi's debt investor presentation, Mar 10, 2010
Slide 1: SG CIB Credit Investor Presentation
SG CIB Credit Investor Presentation Philippe Capron Member of the Management Board & Chief Financial Officer March 10, 2010 IMPORTANT NOTICE: Financial results for the fiscal year ended December 31, 2009 Financial statements audited and prepared under IFRS Investors are strongly urged to read the im
Slide 2: A world leader in communications and entertainment
A world leader in communications and entertainment #1 Video Games Worldwide #1 Music Worldwide #2 Telecoms France #1 Telecoms Morocco #1 Alternative Broadband Brazil #1 Pay-TV France Credit Investor Presentation – March 10, 2010 2
Slide 3: Strong results in a challenging 2009 environment
Strong results in a challenging 2009 environment Revenues: € 27,132 m + 6.9 % EBITA: € 5,390 m + 8.8 % EBITDA: € 7,683 m + 8.1 % Adjusted Net Income: € 2,585 m - 5.5 % CFFO before capex: € 7,799 m +10.5 % CFFO: € 5,237 m + 3.6 % Net debt*: € 9.6 bn at end 2009 Net debt excluding acquisition of 100%
Slide 4: 2009: EBITA up 9% and CFFO above €5.2bn
2009: EBITA up 9% and CFFO above €5.2bn Economic conditions were more challenging than anticipated however our subscription-based model minimized the impact from the crisis Exceptional cash generation in 2009: CFFO before capex at €7.8bn and above €5.2bn after capex We continued investing in network
Slide 5: Another year of record results
Another year of record results EBITA CFFO 5,237 +8% p.a. CAGR 5,390 +6% p.a. CAGR 5,055 4,881 4,953 4,721 4,466 4,370 4,157 EUR millions , IFRS EUR millions , IFRS 3,985 2005 2006 2007 2008 2009 2005 2006 2007 2008 2009 Credit Investor Presentation – March 10, 2010 5
Slide 6: Outstanding business and financial performance in 2009
Outstanding business and financial performance in 2009 Solid subscription activity SFR #1 in mobile postpaid net adds with 36% market share in 2009 SFR grew its broadband net adds market share to 33%* in 2009 Canal+ France‟s portfolio increased by 238k subscribers yoy Approximately 11.5m World of Wa
Slide 7: Vivendi's focus on innovation and growth in 2009
Vivendi‟s focus on innovation and growth in 2009 Major initiatives in 2009: Acquisition of GVT in Brazil, expanding Vivendi‟s footprint in fast-growing markets Launch of iPhone to SFR customers, accelerating mobile internet penetration Launch by SFR of convergent offers to SME Launch of VEVO, a prem
Slide 8: Vivendi to sell its 20% stake in NBC Universal for $5.8bn
Vivendi to sell its 20% stake in NBC Universal for $5.8bn* Vivendi will sell its 20% stake in NBC Universal to GE for $5.8bn and will not be a shareholder in the new entity resulting from the joint venture between NBC Universal and Comcast content assets: If the GE–Comcast transaction is not compl
Slide 9: GVT: outstanding asset and perfect fit with Vivendi
GVT: outstanding asset and perfect fit with Vivendi Acquired an asset with considerable growth potential: a successful alternative operator and a very profitable business model, based on creative and differentiated marketing and network/ IT solutions A major step into one of the largest consumer mar
Slide 10: Class action: a long process
Class action: a long process On January 29, 2010, a jury decided against Vivendi, but cleared its former executives. Vivendi was found to have acted recklessly between October 2000 and August 2002. Jury reduced plaintiffs‟ requested damages by more than 50%. Next steps: Entry of verdict by the jud
Slide 11: Class action: Vivendi will appeal to overturn jury verdict
Class action: Vivendi will appeal to overturn jury verdict Vivendi has many grounds for appeal including: Individuals exonerated but Vivendi liable for miscommunication ! Court‟s decision to include French shareholders in the class Court‟s decision regarding its jurisdiction Plaintiffs‟ erro
Slide 12: Conservative financial policy
Conservative financial policy Commitment to maintaining current BBB(1) credit ratings reaffirmed Low leverage levels: Consolidated Financial Net Debt / Consolidated EBITDA as of December 31, 2009 <1.3 (<0.9 excluding the GVT acquisition debt and EBITDA consolidated since November 13, 2009) Retain at
Slide 13: Financial net debt evolution
In euro billions- IFRS Financial net debt evolution* Dividends Dividends Net financial December 31, CFFO Interest & tax paid to paid to investments and December 31, 2008 after Capex paid and other minorities shareholders other 2009 (0.6) (0.8) (0.7) (8.3) + 5.2 (4.4) (9.6) Including: Including: Incl
Slide 14: Outstanding bonds and bank credit lines available
Bank credit lines available until 2012 Outstanding bonds in the next 5 years 7.2 Vivendi Vivendi 6.6 SFR SFR 5.9 6,0 6,0 5,0 4.3 3,7 3,6 3.1 in euro billions 2,7 in euro billions 2,1 1.7 ** 1,1 End of 2009 End of 2010 End of 2011 End of 2012 End of 2009 End of 2010 End of 2011 End of 2012 End of 201
Slide 15: Outlook
Outlook We have planned 2010 with a reasonably conservative stance, due in part to the continued uncertainties relating to the broader macroeconomic environment and consumer demand, as well as growing regulatory pressure In 2010, we remain committed to building growth for the future: We will conti
Slide 16: Business outlook for 2010
Business outlook for 2010 EBITA above €600m Double digit EBITA margin Mobile: slight decrease in EBITDA Broadband & Fixed: slight increase in EBITDA Moderate growth in revenues in Dirhams Profitability to be maintained at high levels Revenues* up 26% Adjusted EBITDA* up 30% Slight increase in EBITA
Slide 17: Vivendi: A world leader in communications and entertainment
Vivendi: A world leader in communications and entertainment Growth potential driven by innovation Capitalize on consumer demand for mobility, broadband and digital content to increase the value of Vivendi‟s content and networks Benefit from the global transition to digital by creating and distributi
Slide 18: Appendices
vivendi Appendices
Slide 19: Vivendi EUR bond spreads and CDS performance
Vivendi EUR bond spreads and CDS performance Main Vivendi and SFR EUR bonds Evolution of secondary spreads (Z-spread) * Am ount Price at Current Maturity Coupon 450 outstanding (€m ) launch price * 400 Apr-10 3.625% 630 99.417% 100.2% 350 Feb-12 3.875% 600 99.819% 103.0% 300 Oct-13 4.500% 700 99.366
Slide 20: Vivendi's and SFR debt maturity schedule
Vivendi‟s and SFR debt maturity schedule December 31, Maturity In euro millions 2009 2010 2011 2012 2013 2014 >2014 Bond Vivendi SA 5,923.4 630.0 700.0 600.0 1,186.7 1,120.0 1,686.7 SFR 1,300.0 - - 1,000.0 - 300.0 - Sub-total 7,223.4 630.0 700.0 1,600.0 1,186.7 1,420.0 1,686.7 Credit lines Vivendi S
Slide 21: 2009 highlights by business
2009 highlights by business Well above other 3rd party publishers performance, driven by success of major franchises. Double digit EBITA margin, despite very challenging Exceeding guidance in US non-GAAP, posting record music market. Increased participation in a broader range operating margin and EP
Slide 22: 2009 EBITA
2009 EBITA In euro millions - IFRS Change at 2009 2008 Change constant currency Activision Blizzard 484 34 x 14.2 x 13.4 Universal Music Group 580 686 - 15.5% - 14.7% SFR 2,530 2,542 - 0.5% - 0.5% Maroc Telecom Group 1,244 1,224 + 1.6% + 1.0% GVT 20 - Canal+ Group 652 568 + 14.8% + 16.7% Holding & C
Slide 23: Adjusted Net Income
Adjusted Net Income In euro millions - IFRS 2009 2008 Change % Lower contribution from NBC Universal and full Revenues 27,132 25,392 + 1,740 + 6.9% consolidation of Neuf Cegetel since April 15, 2008 EBITA 5,390 4,953 + 437 + 8.8% Impact of lower interest Income from equity affiliates 171 260 - 89 in
Slide 24: Solid Cash Flow generation
Solid Cash Flow generation CFFO before capex CFFO 2009 2008 Change In euro millions - IFRS 2009 2008 Change 1,043 345 x 3.0 Activision Blizzard 995 313 x 3.2 329 555 - 40.7% Universal Music Group 309 521 - 40.7% 3,966 4,057 - 2.2% SFR 2,263 2,752 - 17.8% 1,659 1,455 + 14.0% Maroc Telecom Group 1,173
Slide 25: Syndicated Bank facilities of Vivendi SA and SFR
Syndicated Bank facilities of Vivendi SA and SFR As of December 31, 2009 (in million of euros) Maximum Maturity amount Vivendi SA €2.0 billion revolving facility (April 2005) April 2012 2 000 €2.0 billion revolving facility (August 2006) August 2012 271 August 2013 1 729 €2.0 billion revolving facil
Slide 26: Main financial covenants in bank credit lines
Main financial covenants in the Vivendi SA and SFR banks credit lines At Vivendi SA: ratio of Proportionate Financial Net Debt to Proportionate EBITDA (1) ≤ 3 At SFR: Ratio of Financial Net Debt to consolidated EBITDA ≤ 3.5 Ratio of consolidated earning from operations to consolidated net financing
Slide 27: Activision Blizzard: Revenues €3,038m, EBITA €484m
IFRS Revenues: €3,038m Increased retail market share to 16% in US/Europe* In euro millions Constant Unprecedented success with Call of Duty: Modern Warfare2, IFRS 2009 2008 Change currency #1 best-selling console title in the US and Europe* Revenues 3,038 2,091 + 45.3% + 41.4% DJ Hero was the highes
Slide 28: Universal Music Group: Revenues €4,363m, EBITA €580m
Revenues: €4,363m Increase in digital sales, Artist Services & Merchandising and Publishing more than offset by In euro millions - IFRS Constant decline in demand for physical products and lower 2009 2008 Change currency license income: Revenues 4,363 4,650 - 6.2% - 6.2% Digital sales up 8.4%, inc
Slide 29: Successful integration of Neuf Cegetel into the new SFR
Successful integration of Neuf Cegetel into the new SFR Mobile revenues: stable #1 in postpaid net adds in 2009 with 36.2% market share Growth in customer base, data revenues (+33%) and handset revenues offset the regulatory impact* and In euro millions - IFRS 2009 2008 Change adverse economic condi
Slide 30: Maroc Telecom Group: Revenues €2,694m, EBITA €1,244m
Revenues: €2,694m, +3.6% In euro millions - IFRS Constant Continued leadership in Morocco (mobile customer base 2009 2008 Change currency up 5.6% yoy) despite more challenging economic and Revenues 2,694 2,601 + 3.6% + 3.0% Mobile 1,971 1,867 + 5.6% + 5.0% regulatory environment Fixed and Internet 9
Slide 31: GVT: Revenues BRL1,699m, EBITDA BRL656m
Revenues: BRL1,699m* up 28.7% 916k net adds in lines in service (LIS), up 36.6% In BRL millions* Broadband subscribers reached 669k, 39% with speed of 2009 2008 Change 10 Mbps and higher compared with 0.3% in 2008 Net revenue 1,699 1,320 + 28.7% Successful expansion in Vitoria, Vila Velha and Recife
Slide 32: Canal+ Group: Revenues and EBITA
Revenues: +1.6% at constant currency Strong portfolio growth reaching 12.5m subscriptions In euro millions - IFRS Constant 2009 2008 Change currency Canal+ France: 238k net adds in 2009, strong recruitments in Q4 in metropolitan France Revenues 4,553 4,554 - + 1.6% Poland / Vietnam: 259k net add
Slide 33: #1 worldwide in music, pay-TV, telecom
100% 100%/80% 56% #1 worldwide in music #1 in pay-TV in France #2 in telecom in France 53% 57%* 87%* #1 in telecom #1 worldwide in #1 alternative in Morocco video games broadband operator in Brazil * Based on shares outstanding Credit Investor Presentation – March 10, 2010 33
Slide 34: Activision Blizzard US non-GAAP segment performance
US non-GAAP comparable basis segment performance* IFRS Actual 2009 2008 % Change In euro millions 2009 In dollar millions Activision 1,819 Activision Publishing 3,156 3,279 Blizzard 922 Blizzard Entertainment 1,196 1,343 Distribution 423 410 Distribution 297 Core revenues 3,038 Core net revenues 4,7
Slide 35: Activision Blizzard – Reconciliation to 2009 IFRS Revenues
Activision Blizzard – Reconciliation to 2009 IFRS Revenues 2009 In millions Non-GAAP Net Revenues of Core Operations $4,775 Add back: Changes in deferred net revenues (a) -$497 Add back: Net Revenues of non-core exit operations (b) $1 Net Revenues in US GAAP as published by Activision Blizzard $4,27
Slide 36: Activision Blizzard – Reconciliation to 2009 IFRS EBITA
Activision Blizzard – Reconciliation to 2009 IFRS EBITA 2009 In millions Non-GAAP Operating Income/(Loss) of Core Operations $1,234 Changes in deferred net revenues and related cost of sales (a) -$383 Results of non-core exit operations (b) -$8 Equity-based compensation expense (c) -$154 One time co
Slide 37: Top-selling artists and upcoming releases
Top-selling artists Million Million 2009 units* 2008 units* Black Eyed Peas 5.2 Mamma Mia! OST 5.1 Taylor Swift 4.8 Duffy 4.6 Lady Gaga - The Fame 4.5 Amy Winehouse 4.1 U2 4.1 Lil Wayne 3.4 Andrea Bocelli 3.6 Rihanna 3.4 Top - 5 Artists 22.2 Top - 5 Artists 20.6 % Change 2009 at constant In euro mil
Slide 38: SFR mobile and broadband KPIs
2009 2008 Change MOBILE Customers (in '000)* 20 395 19 652 + 3,8% Proportion of postpaid clients* 72,6% 69,1% +3,5 pts 3G customers (in '000)* 8 386 5 934 + 41,3% Market share on customer base (%)* 33,2% 33,9% -0,7 pt Network market share (%) 34,9% 35,8% -0,9 pt 12-month rolling blended ARPU (€/year
Slide 39: SFR detailed revenues
Detailed revenues IFRS 2009 2008 % 2008 % Change on in euro millions Actual Actual Change comparable a comparable basis* basis* Outgoing revenues net of promotions 6,939 82% 6,953 81% - 0.2% 6,962 81% -0.3% Mobile incoming 963 11% 897 10% + 7.4% 897 10% Fixed incoming revenues 315 4% 393 5% - 19.8%
Slide 40: Maroc Telecom SA and African subsidiaries
Maroc Telecom SA In '000 (except where noted) 2009 2008 Change Number of mobile customers 15,272 14,456 + 5.6% African subsidiaries % Prepaid customers 95% 96% -1.0 pt ARPU (€/month) 8.7 8.7 - In '000 2009 2008 Change Number of fixed lines 1,234 1,299 - 5.0% Internet customers 470 478 - 1.7% Maurita
Slide 41: GVT Total Lines in Services and Net Adds
In '000 2009 2008 Change Total Lines in Services (LiS) 2,817 1,901 + 48.2% Retail and SME 1,891 1,324 + 42.8% o/w Voice Lines 1,222 883 + 38.4% o/w Broadband 669 441 + 51.7% Corporate 779 480 + 62.3% Internet et VoIP (VONO) 147 97 + 51.5% In '000 2009 2008 Change New Net Adds (NNA) 916 671 + 36.6% R
Slide 42: Canal+ Group portfolio, churn and ARPU
Dec 31, 2009 Dec 31, 2008 Change (in ‘000) Portfolio Canal+ Group 12,471 11,974 + 497 ow Canal+ France* 10,829 10,591 + 238 ow International** 1,642 1,383 + 259 In Metropolitan France 2009 2008 Change Churn per digital subscriber 12.3% 13.0% -0.7 pt ARPU per subscriber 44.7 € 43.8 € + €0.9 * Individ
Slide 43: Revenues by segment
Revenues In euro millions - IFRS Change at 2009 2008 Change constant currency Activision Blizzard 3,038 2,091 + 45.3% + 41.4% Universal Music Group 4,363 4,650 - 6.2% - 6.2% SFR 12,425 11,553 + 7.6% + 7.6% Maroc Telecom Group 2,694 2,601 + 3.6% + 3.0% GVT 104 - Canal+ Group 4,553 4,554 - + 1.6% Non
Slide 44: Income from equity affiliates
Income from equity affiliates In euro millions - IFRS (except where noted) 2009 2008 % Change Income from equity affiliates 171 260 - 34.2% o/w NBC Universal in € 178 255 - 30.2% NBC Universal in $ $249 $375 - 33.6% o/w Neuf Cegetel* - 18 * Neuf Cegetel has been fully consolidated since April 15, 20
Slide 45: Interest
Interest In euro millions – IFRS (except where noted) 2009 2008 Interest (458) (354) Interest expense on borrowings (486) (450) Average interest rate on borrowings (%) 4.75% 4.69% Average outstanding borrowings (in euro billions) 10.2 9.6 Interet income from cash and cash equivalents 28 96 Average i
Slide 46: Income tax
Income tax In euro millions – IFRS 2009 2008 Adjusted Net Adjusted Net net income income net income income Consolidated Global Profit Tax System 184 476 438 60 Current tax: savings for current year 184 184 438 438 Deferred tax: variation in expected savings (year n+1 / year n) - 292 - (378) Tax char
Slide 47: Reconciliation of Adjusted Net Income to Net Income, group share
Reconciliation of Adjusted Net Income to Net Income, group share In euro millions - IFRS 2009 2008 Adjusted Net Income 2,585 2,735 Impairment losses at UMG and Activision Blizzard, Amortization and impairment losses of intangible assets and (1,554) (693) acquired through business combinations impact
Slide 48: Glossary
Glossary Adjusted earnings before interest and income taxes (EBITA): EBIT (defined as the difference between charges and income that do not result from financial activities, equity affiliates, discontinued operations and tax) before the amortization of intangible assets acquired through business com
Slide 49: Activision Blizzard – stand alone - definitions
Activision Blizzard – stand alone - definitions US Non-GAAP Financial Measures Activision Blizzard provides net revenues, net income (loss), earnings (loss) per share and operating margin data and guidance both including (in accordance with GAAP) and excluding (non-GAAP): the impact of the change in
Slide 50: Investor Relations team
Investor Relations team Jean-Michel Bonamy Executive Vice President Investor Relations +33.1.71.71.12.04 jean-michel.bonamy@vivendi.com Paris 42, Avenue de Friedland New York 75380 Paris cedex 08 / France 800 Third Avenue Phone: +33.1.71.71.32.80 New York, NY 10022 / USA Fax: +33.1.71.71.14.16 Phone
Slide 51: Important legal disclaimer
Important legal disclaimer This presentation contains forward-looking statements with respect to Vivendi’s financial condition, results of operations, business, strategy and plans as well as expectations regarding the payment of dividends. Although Vivendi believes that such forward-looking statemen