Xilam Animation Sa · EURONEXT:ALXIL
Xilam Animation Sa — H1 2019 Earnings Presentation
23 slides from Xilam Animation Sa's earnings presentation, October 2019
Slide 1: 2019 Half-Year Results
2019 HALF-YEAR RESULTS HIGH LEVEL OF PRODUCTION ACTIVITY, REAL BREAKTHROUGH IN THE US: SOLID PROSPECTS 1
Slide 2: An Integrated Pure Player with Global Reach
AN INTEGRATED PURE PLAYER WITH GLOBAL REACH › A leading animation group ─ Power, strong reputation and diversification of a proprietary brands portfolio ─ Integration of the entire value chain ‒ 20 years › A major digital player ‒ 4 production studios: Paris, ─ Acceleration in sales to US streaming
Slide 3: In Pole Position to Benefit from the Streaming War
IN POLE POSITION TO BENEFIT FROM THE STREAMING WAR ─ April 2020 ─ Pricing unknown (free for US cable subscribers) Available Not yet available ‒ Lever of continuing globalisation ‒ Favours “super ─ Spring 2020 ─ €16-17 per month producers” Catalogue ─ Catalogue: 10,000 h ─ 12/11 ─ €6.99 per month (ex
Slide 4: An Independent Family-Owned Group
AN INDEPENDENT FAMILY-OWNED GROUP Voting rights MDP Audiovisuel 38.4% Xilam Group 14.9% Treasury shares 1.1% 1 Other 3.3% MDP Audiovisuel; 26,3% Free float 42.3% Free float; 57,8% Xilam Group; 10,1% Majority of voting rights held Treasury shares; 1,5% by the founder Other2 (53.3%) 4,3% (1) Xilam Gro
Slide 5: A Business Model with Long and Enduring Cycles
A BUSINESS MODEL WITH LONG AND ENDURING CYCLES 5
Slide 6: Expertise Spanning the Entire Value Chain
EXPERTISE SPANNING THE ENTIRE VALUE CHAIN CREATION PRODUCTION DISTRIBUTION No or very few Tight grip on Very little third-party costs and commission to be rights in its margin paid to third properties retention parties on sales Business line integration to unlock the greatest possible value Presenta
Slide 7: Powerful Business Model Providing Visibility and Security
POWERFUL BUSINESS MODEL PROVIDING VISIBILITY AND SECURITY NEW CATALOGUE PRODUCTIONS 2/3 of revenue 1/3 of revenue ─ Powerful engine of growth ─ Volume leverage: continuous enrichment ─ Steady increase in prefinancing ─ 60% of revenue recurring ─ High visibility for two years ─ Major impact on profit
Slide 8: A Business Model with Long Cycles (1/2)
A BUSINESS MODEL WITH LONG CYCLES (1/2) 2 years 3 years 5-6 years ∞ Animation life PRODUCTION DELIVERY ADDITION TO CATALOGUE cycle PRESALES = 100% to 140% COMMENCEMENT OF COMMENCEMENT OF Revenue COVERAGE OF PRODUCTION RIGHTS FOR THE FIRST RIGHTS FOR THE COSTS OPERATING CYCLE SECOND OPERATING EXCLUDI
Slide 9: A Business Model with Long Cycles (2/2)
A BUSINESS MODEL WITH LONG CYCLES (2/2) 2 years 3-4 years ∞ Completion of episode delivery Coûts de production Chiffre d'affaires Encaissements Commencement of multiple rights in France Commencement of international rights Commencement of multiple rights for for the first operating cycle (presales)
Slide 10: Breakthroughs
BREAKTHROUGHTS 10
Slide 11: Inroads Made by the Xilam Brand with US Streaming Majors
INROADS MADE BY THE XILAM BRAND WITH US STREAMING MAJORS GLOBAL DISTRIBUTION AGREEMENT WITH NETFLIX PRODUCTION DEAL WITH DISNEY FOR A FOR I LOST MY BODY, A GRAND PRIZE WINNER IN THE CHIP ‘N’ DALE ANIMATION SERIES CRITICS’ WEEK SECTION AT THE CANNES FILM FESTIVAL ─ A successful R&D development, leadi
Slide 12: Creative Cube, Unrivalled Expertise in Computer-Generated Images
CREATIVE CUBE, UNRIVALLED EXPERTISE IN COMPUTER-GENERATED IMAGES ─ Integrated animated film production studio based on computer-generated images ─ Multi-genre and high-end expertise: short films, music videos, adverts, “big-screen” 3D films, series and feature-length films ─ Broad customer portfolio
Slide 13: Organisational Improvements and Finance Division Strengthened
ORGANISATIONAL IMPROVEMENTS AND FINANCE DIVISION STRENGTHENED Fabrice Cantou François Bardoux Chief Financial & Strategy Officer Deputy Chief Operating Officer ─ Digital profile aligned with Xilam’s ─ 3 years at Xilam as CFO development as a pure player ─ Operational background ─ International/US pr
Slide 14: Record Results
RECORD RESULTS H1 2019 RESULTS 14
Slide 15: Results Demonstrating the Model's Effectiveness
RESULTS DEMONSTRATING THE MODEL’S EFFECTIVENESS (€ thousands) H1 2019 H1 2018 Revenue from New Productions 2,962 3,963 Subsidies and other income from new productions 1,844 4,502 Total income from new productions 4,806 8,465 Catalogue revenue 3,055 5,385 Other revenue 25 16 Total revenue and other i
Slide 16: Financial Position Strengthened
FINANCIAL POSITION STRENGTHENED 30 June 31 Dec. 2018 30 June 31 Dec. 2018 ASSETS (€ thousands) LIABILITIES (€ thousands) 2019 Reported 2019 Reported Goodwill 664 664 Share capital 491 491 Retained earnings, net income and treasury shares 49,374 47,728 Intangible assets 67,138 60,422 Total equity 49,
Slide 17: Analysis of Net Debt
ANALYSIS OF NET DEBT 31 Dec. 2018 (€ thousands) 30 June 2019 Reported Cash and cash equivalents, net 13,966 2,231 Borrowings (15,414) (4,055) Self-liquidating financial liabilities (5,751) (5,995) Net debt (7,199) (7,819) Presentation of first-half 2019 results 17
Slide 18: Healthy Visibility, Objectives Reiterated
HEALTHY VISIBILITY, OBJECTIVES REITERATED 18
Slide 19: Series in Production – A Record Level
6 SERIES IN PRODUCTION – A RECORD LEVEL 26 half-hours 26 half-hours 26 half-hours 26 half-hours 52 half-hours 13 half-hours A total of 169 half hours Presentation of first-half 2019 results 19
Slide 20: Objective Restated
OBJECTIVE RESTATED Delivery projections for new productions (in half-hours) 100 80 69 63 51 35 2015 2016 2017 2018 2019 2020 New productions strengthening the catalogue with each passing year +195 half-hours Presentation of first-half 2019 results 20
Slide 21: Regulatory Changes Favourable to Independent Producers
REGULATORY CHANGES FAVOURABLE TO INDEPENDENT PRODUCERS: ENACTMENT OF THE EUROPEAN DIRECTIVE ON AUDIOVISUAL MEDIA SERVICES INTO FRENCH LAW › Two major reforms applicable from 01/01/2021 ─ At least 30% of the content broadcast on all channels and platforms in Europe must be of European origin. ─ All b
Slide 22: Ambitious Development Strategy
AMBITIOUS DEVELOPMENT STRATEGY Digital platforms Increase in the US component of revenue Growth in volume Extension of the product range: - Pre-school AND in value of - Kids Organic growth new productions - Family and growth through - Adult acquisitions International expansion Power and resilience o
Slide 23: Conclusion
CONCLUSION Security Visibility Growth Profitability Presentation of first-half 2019 results 23