Solocal Group · EURONEXT:LOCAL

Solocal — Investor Day (February 2013)

71 slides from Solocal's investor day presentation, Feb 13, 2013

  1. Slide 1: Financial results 2012 and Investor Day

    Financial results 2012 and Investor Day 13 February 2013

  2. Slide 2: Disclaimer

    Disclaimer This document contains forward-looking statements. Although PagesJaunes Groupe 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 r

  3. Slide 3: Investor Day objectives

    Investor Day objectives 2012 Annual Results presentation PagesJaunes Groupe digital transformation Our strategic initiatives and actions to accelerate our Internet development « Digital 2015»: a program supporting digital transformation 2013 Outlook © Copyright PagesJaunes 2012 2

  4. Slide 4: Financial results 2012

    Financial results 2012 Martine Gerow Chief Financial Officer © Copyright PagesJaunes 2012 3

  5. Slide 5: 2012 Full-Year results in line with expectations

    2012 Full-Year results in line with expectations Strong growth in Internet revenues Strong Internet growth: +8.3% i.e. over 3 points above the French market growth1, with Internet representing 58.4% of Group revenues Resilience of the business in a deteriorated environment: Group revenues of 1,066.2

  6. Slide 6: Strong Internet growth: Growth of +8.3% and 58.4% of Group revenues

    Strong Internet growth: Growth of +8.3% and 58.4% of Group revenues Consolidated revenues by segment In million euros 2012 2011 Change Group revenues 1,066.2 1,101.6 -3.2% Internet 622.7 575.0 +8.3% as % of Group revenues 58.4% 52.2% Printed directories 416.6 490.7 -15.1% as % of Group revenues 39.1

  7. Slide 7: Sustained high margin rate: Adjusted GOM of 471.4 million euros

    Sustained high margin rate: Adjusted GOM of 471.4 million euros or 44.2% of Group revenues Adjusted gross operating margin* by segment In million euros 2012 2011 Change Group adjusted gross operating margin* 471.4 493.1 as % of Group revenues 44.2% 44.8% -60 bps Internet* 273.8 257.6 as % of Group r

  8. Slide 8: Impact of accounting restatement of sales force fixed compensation and IAS 19R

    Impact of accounting restatement of sales force fixed compensation and for early adoption of IAS 19R ■ Expensing of sales force fixed compensation: recognition in the year of occurrence vs. at the rate of recognition of the revenues on 2 calendar years ■ Continued expensing of sales force variable c

  9. Slide 9: Strong sales investment partly offset by strict cost discipline

    Strong sales investment partly offset by strict cost discipline Change in Consolidated gross operating margin (GOM) in million euros 487.9 19.4 13.3 464.5 (18.7) (2.0) (35.4) Paper, GOM Other Sales personnel Other personnel GOM Revenues Print, 2011 expenses expenses expenses 2012 Distribution Change

  10. Slide 10: Increase in depreciation and financial expenses impacted by refinancing

    Increase in depreciation in line with investment policy and financial expenses impacted by the refinancing in 2011 From gross operating margin to consolidated net income In million euros 2012 2011* Change Gross operating margin 464.5 487.9 -4.8% Legal employee profit sharing (14.7) (14.1) -4.3% Depr

  11. Slide 11: Continued high cash flow of €185 M

    Continued high cash flow of €185 M Net Cash flow as of 31 December 2012 (in million euros) 464 (43) (107) (107) (22) 185 (172) 1 14 GOM Capex Financial Tax Other Net cash Decrease in Other ∆ net cash 2012 result Operational flow borrowings 2012 charges* 2012 * Including primarily change in working c

  12. Slide 12: Priority given to the reduction of indebtedness

    Priority given to the reduction of indebtedness Net debt* (in million euros) Maturity Profile** (in million euros) 1,273 1,915 1,900 - €173 M 962 919 1,742 350 350 96 95 2010 2011 2012 2013 2014 2015 2018 Before refinancing After refinancing €2,231 M €1,814 M * Net financial debt: total gross financ

  13. Slide 13: Compliance with covenants

    Compliance with covenants Financial leverage1 7% Interest coverage 33% 4.5x 4.3x 4.3x 4.0x 4.0x 5.85x 5.39x 4.44x 3.97x 4.00x 3.75x 3.76x 3.82x 3.66x 3.71x 3.00x 3.00x 3.00x 3.00x 3.57x 12/31/10 06/30/11 12/31/11 06/30/12 12/31/12 12/31/10 06/30/11 12/31/11 06/30/12 12/31/12 Net debt over GOM Maximu

  14. Slide 14: Investor Day

    Investor Day Jean-Pierre Remy Chairman and CEO © Copyright PagesJaunes 2012 13

  15. Slide 15: Agenda

    Agenda ■ A successful digital transformation ■ 2015 strategic roadmap ■ Growth opportunities: mobile, contents and audience partnerships ■ Proposed organisation of the Group around five business categories ■ 2013 Outlook © Copyright PagesJaunes 2012 14

  16. Slide 16: A successful digital transformation

    A successful digital transformation © Copyright PagesJaunes 2012 15

  17. Slide 17: PagesJaunes Groupe snapshot

    PagesJaunes Groupe snapshot Leader in Local Advertising Market Profile & key 2012 Figures 1 Strong digital business ■ €1.07 bn revenues and €471 M GOM1 (44%) ■ 58% of Digital revenues Users Brands & reach ■ ~30% share of France online local advertising market ■ Resilient, subscription-based business

  18. Slide 18: 58% of Online revenues, with robust growth and high profitability

    58% of Online revenues, with robust growth and high profitability Contribution of Online to Group’s 2012 results 2012 vs 2011 Revenues Growth GOM 1 €622.7 M €273.8 M 58% 44% Of Digital +8.3% revenues 2012 vs 2007: +64% Source: Annual Reports PJG 1 Before impact of the expensing of fixed costs of the

  19. Slide 19: Online, the main growth and margin driver

    Online, the main growth and margin driver Revenues Growth 08-11 EBITDA margin (%) vs Media Reach (%) vs. Online weight CAGR Revenues 08-11 (%) 2% 50% Reach (%) 0% 45% ** -2% 40% PJ Canada -4% 35% -6% 30% -8% 25% -10% * 20% * -12% 15% -14% 10% -16% 5% -18% 0% 0% 10% 20% 30% 40% 50% 60% 20% 25% 30% 35

  20. Slide 20: Active monitoring of the Printed directories business

    Active monitoring of the Printed directories business Limited revenues decline thanks to resilient audiences and positive mix of rural areas Contained Strict profitability control and directory discontinuation as soon as slowdown margin is below breakeven Contribution of €187.5 M to Group’s 2012 adj

  21. Slide 21: Online leadership built on contents, medias and local communication expertise

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

  22. Slide 22: Highly recognised and complementary portfolio of brands and services

    Highly recognised and complementary portfolio of brands and services Medias SPECIALISED SOCIAL LOCAL YP MEDIA MAPS GUIDES MEDIA META-SEARCH Business categories RESTAURANT offerings CLASSIFIED VERTICAL REAL ESTATE VERTICAL HOME IMPROVEMENT RESTAURANT ONLINE MOBILE APP ORDERING Digital Marketing APPOI

  23. Slide 23: PagesJaunes Groupe has transformed to adapt to new technological evolutions

    PAGESJAUNES GROUPE HAS TRANSFORMED to adapt to new technological and social evolutions The Group is now definitely MORE LOCAL, MORE ONLINE AND MORE MOBILE To complete our turnaround, PagesJaunes Groupe adopts a NEW MODEL and a NEW IDENTITY 22

  24. Slide 24: Solocal Group

    Sobcal GROUP °

  25. Slide 25: The digital brands for daily life

    THE DIGITAL BRANDS FOR DAILY LIFE 24

  26. Slide 26: A new name and a new identity

    A NEW NAME AND A NEW IDENTITY To voice our leadership on LOCAL communication: we aim at assisting our client in creating digital contents on all local medias To explicitely state that our project is LOCAL, ONLINE AND MOBILE To enhance Group capacity to COMBINE A DIVERSIFIED RANGE OF BRANDS AND SERVI

  27. Slide 27: 2015 Strategic roadmap

    Sobcal GROUP < 2015 STRATEGIC ROADMAP

  28. Slide 28: Online growth accelerated by new streams of digital services

    ONLINE GROWTH ACCELERATED BY NEW STREAMS OF DIGITAL SERVICES Incremental Online revenues generated since 2007 Double-digit online growth CAGR Online 2012 vs 2007 €623 M New services +10.5% Transactional WebSites / more AdContent specialised by Display market €380 M Mobile segments +€206 M Enhanced u

  29. Slide 29: Strategic initiatives to capture online market growth opportunities

    STRATEGIC INITIATIVES TO CAPTURE ONLINE MARKET GROWTH OPPORTUNITIES Market 2012 CAGR Growth Solocal Assets 12-15 Enriched business categories contents Search +7% +7% Audience partnerships (Bing, Yahoo!) Explosive audience and usage Mobile +30% +19% Mappy: Local search, web-to-store and shopping Laun

  30. Slide 30: Digital 2015 to support transformation around 4 objectives

    « DIGITAL 2015 » TO SUPPORT TRANSFORMATION AROUND 4 OBJECTIVES ACCELERATE ONLINE GROWTH by specialising offers, focusing on our clients’ needs by business category and developing new capabilities to support them in digital marketing ENHANCE THE EFFICIENCY OF OUR MEDIAS, FIXED AND MOBILE, by providin

  31. Slide 31: Ambitions Digital 2015

    AMBITIONS « DIGITAL 2015 » Values / Digital IT KPIs Management Talents Targeted and efficient traffic Customer experience SolocaI Business Impact Digital Company Partnerships & International Solocal corporate culture 30

  32. Slide 32: Growth opportunities: mobile, contents and audience partnerships

    31 3. GROWTH OPPORTUNITIES: MOBILE, CONTENTS AND AUDIENCE PARTNERSHIPS Julien Billot Executive Vice-President in charge of media 31

  33. Slide 33: The five drivers of digital growth

    THE FIVE DRIVERS OF DIGITAL GROWTH 2011/12 change in audience Content: Indirect: 25% audience Total audience: 7k fan pages SEO +9% 112k websites: Partnerships +30% 700k detailed pages: +54% Own AdNetwork Total audience: +12% Metasearch Mobile web: Own social 19% audience local media +83% YOY 32

  34. Slide 34: Strong and sustained growth in audience

    STRONG AND SUSTAINED GROWTH IN AUDIENCE High awareness and large audience Sustained growth in audience in France Reach of the Parent PagesJaunes (%) Number of visits per month (in millions) +52 143 Fixed Mobile 27 +128% +26M 46% 92 +26M +6.5% 1 +26pts > 20m of mobile 117 20% applications 91 2008-12

  35. Slide 35: Mobile and tablets, key growth drivers with high monetisation potential

    MOBILE AND TABLETS, KEY GROWTH DRIVERS WITH HIGH MONETISATION POTENTIAL Mobile applications downloaded (in millions) Cumulated 22.4 Strong positions on all X1.7 0.9 Other platforms 13.4 7.9 Androïd: dynamic growth X2.2 0.7 Windows 8: tablet version 6.0 4.0 0,2 iOS: success with new 13.5 1.8 8.7 appl

  36. Slide 36: Extension of Mappy services towards web-to-store and shopping experiences

    EXTENSION OF MAPPY SERVICES TOWARDS WEB-TO- STORE AND SHOPPING EXPERIENCES Maps, the new media for generating in-store 3D Immersive traffic Unique collection of navigation (integration Store & Product indoor shop views of UrbanDive) Locator Digital showcases for Re-inventing Mappy Coverage of 320 ci

  37. Slide 37: Connect Tier 1 brands accounts with consumers locally

    CONNECT TIER 1 BRANDS ACCOUNTS WITH CONSUMERS LOCALLY Local experience, a key concern for Store Locator + SEO for large retailers major brands network Global/local communication consistency Trackable efficiency (ROI) Local deployment at salespoint level A unique value proposal: 1st local digital adv

  38. Slide 38: Leadership in websites creation and digital marketing

    LEADERSHIP IN WEBSITES CREATION AND DIGITAL MARKETING Number of websites sold in France and in Spain (in thousands) +26k websites 135.0 108.7 23.1 A competitive advantage in building content: 77.9 23.1 17.6 Competitive advantage in 111.9 production costs (volume, 85.6 experience) 60.3 Operational ex

  39. Slide 39: Developing websites towards business categories and digital marketing services

    DEVELOPING WEBSITES TOWARDS BUSINESS CATEGORIES AND DIGITAL MARKETING SERVICES Expansion of the range in business categories New digital marketing services Examples Website for E-commerce restaurants offering Website for Facebook Fan Pages medical creation services Expansion of websites offerings to

  40. Slide 40: A 360° traffic

    A 360° TRAFFIC S TA N D A L O N E SEARCH in all the PagesJaunes Brand medias on all search engines M U LT I - E N G I N E 360° Content publishing EXTENSION I N T E G R AT I O N on Group other brands with key players of the Web and traffic crossroads M U LT I - C O N T E X T AT E V E R Y S T E P O F

  41. Slide 41: Developing opportunities beyond our core business

    DEVELOPING OPPORTUNITIES BEYOND OUR CORE BUSINESS D I G I TA L M A R K E T I N G I N T E R N AT I O N A L AND CONTENT 3 3 2 MOBILE CORE BUSINESS 1 Retail, Distribution, Web-to-store 1 Mobile: 2 Digital Marketing 3 International: New businesses and Content: Platforms by business and new targets Depth

  42. Slide 42: Proposed organisation around five business categories

    41 4. PROPOSED ORGANISATION AROUND FIVE BUSINESS CATEGORIES Christophe Pingard Executive Vice President, Deputy Chief Operating Officer 41

  43. Slide 43: Growth in local online business comes with a vertical markets segmentation

    GROWTH IN LOCAL ONLINE BUSINESS COMES WITH A VERTICAL MARKETS SEGMENTATION USERS CLIENTS ■ Experiences ■ Specialisation of the differentiated by search Digital Search market needs ■ More demanding analytics ■ Media solutions from clients whose anticipating new client budgets are increasingly needs m

  44. Slide 44: Enriching our content is key to develop business segments offerings

    ENRICHING OUR CONTENT IS KEY TO DEVELOP BUSINESS SEGMENTS OFFERINGS Restaurants detailed pages – PJ vs Google vs Lafourchette Google+ PJ Lafourchette Basic datas Reviews Basic datas Reviews Basic datas Reviews Hours Menus Hours Menus Hours Menus Map Booking Map Booking Map Booking Deals Availability

  45. Slide 45: Solocal vertical market approach competes with specialists and partners with generalists

    SOLOCAL VERTICAL MARKET APPROACH COMPETES WITH SPECIALISTS AND PARTNERS WITH GENERALISTS Generalists Specialists ■ User focus ■ Exclusive content ■ Specialisation and in- ■ Best-in class experience ■ Destination media depth contents and services ■ Worldwide brands and ■ Customer focus: technologies

  46. Slide 46: Group activity could be organised around five business categories

    GROUP ACTIVITY COULD BE ORGANISED AROUND FIVE BUSINESS CATEGORIES RETAIL SERVICE HOME B2B PUBLIC Hotels Real estate Home repair Health Restaurants Cars Legal Medias & brands ■ ~ € 210M revenues ■ ~€ 230M revenues ■ ~€ 330M revenues ■ ~€ 165M revenues ■ ~€ 65M revenues ■ 215k clients ■ 115k clients ■

  47. Slide 47: Leverage success on real estate and restaurant business categories

    LEVERAGE SUCCESS OF JUMP ON REAL ESTATE AND RESTAURANT BUSINESS CATEGORIES Real Estate Restaurants customised offers and + + media Listing Classified & marketing digital Listing @ booking & ordering, promo ■ 72% of online revenues ■ 69% of online revenues Advanced Digitalisation ■ 95% of Digital cli

  48. Slide 48: New real estate business category offering

    NEW REAL ESTATE BUSINESS CATEGORY OFFERING + Unique media Large qualified A range of customised positioning inventory services ■ 3 complementary ■ 1m real estate ■ Listing with rich content media classifieds ■ Real estate classifieds ■ 1.5M unique ■ National coverage monthly visitors ■ Direct Digita

  49. Slide 49: New restaurant business category offering

    NEW RESTAURANT BUSINESS CATEGORY OFFERING + Unique audience Rich and exclusive High value-added crossroads content services ■ 6M restaurants ■ ~130k listed ■ Ranking and Search searches per month, of restaurants, France’s ■ Table booking which 25% on mobile largest database ■ Meal ordering for ■ > 5

  50. Slide 50: Developing transactional experience: example with Chronoresto

    DEVELOPING TRANSACTIONAL EXPERIENCE BETWEEN CLIENTS AND CONSUMERS: EXAMPLE WITH CHRONORESTO Acquisition Reinforce SoLocal's leading position of Chronoresto on restaurant business category ■ France's 2nd internet portal dedicated to online meal orders and ■ Ordering proposal for consumers delivery ■

  51. Slide 51: Business category platforms leading towards internationalisation

    BUSINESS CATEGORY PLATFORMS LEADING TOWARDS INTERNATIONALISATION International development through Expanding the model technologies and vertical markets internationally ■ Targeted areas: ■ Leveraging expertise and know-how Fast growing online advertising markets ■ Targeted acquisitions by vertical S

  52. Slide 52: 2013 Outlook

    51 5. 2013 OUTLOOK Jean-Pierre Remy Chairman and CEO 51

  53. Slide 53: Slowdown in the online advertising market in uncertain French macro environment

    SLOWDOWN IN THE ONLINE ADVERTISING MARKET IN UNCERTAIN FRENCH MACRO ENVIRONMENT Evolution of French online advertising market ■ Tightening advertiser budgets in (annual growth rate) uncertain economic environment ■ Decrease of French advertising 11.1% spend experienced by all industry 9.2% players ■

  54. Slide 54: Guidance 2013

    GUIDANCE 2013 In the light of the advertising marked slowdown in the 4th quarter of 2012, the Group adopts the following targets for 2013: REVENUE DECREASE BETWEEN -5% AND -3% – CONTINUED GROWTH in our Internet business, above French Online market – Internet business representing NEARLY 65% OF TOTAL

  55. Slide 55: Successful digital transformation

    1 SUCCESSFUL DIGITAL transformation A PROFITABLE AND CASH STRENGTH OF AUDIENCES 7 2 GENERATIVE business and LOCAL MEDIAS “DIGITAL 2015”: STRONG GROWTH of 6 Operational transformation 3 MOBILE ACTIVITIES and additional digital growth SALES AND MARKETING 5 4 WIDE portfolio of LOCAL LEADERSHIP on busin

  56. Slide 56: Appendices Financial results

    Appendices Financial results © Copyright PagesJaunes 2012 55

  57. Slide 57: Trend in Printed directories revenues

    Trend in Printed directories revenues ■ Decrease in Printed directories revenues of -15.1% over financial Trend in the revenues from Printed directories year 2012 In million euros -9.2% -15.1% ■ Drop in revenues of -17.8% in Q4 linked in particular to the 490.7 PagesBlanches discontinuation in -31.1

  58. Slide 58: Trend in Internet (fixed and mobile)

    Trend in Internet (fixed and mobile) Internet revenues split and trend In million euros +7.0% +8.3% 700 622.7 600 575.0 +9.0% 165.2 500 +11.5% 151.6 400 300 +8.1% 200 +5.4% 423.4 457.5 100 0 2011* 2012 Search Display, sites and digital marketing Internet revenues at 58.4% of Group revenues net growt

  59. Slide 59: Revenues and Adjusted gross operating margin: Q4 and financial year 2012

    Revenues and Adjusted gross operating margin: 4th quarter and financial year 2012 In million euros Q4 2012 Q4 2011 Change 2012 2011 Change Internet 159.4 151.4 +5.3% 622.7 575.0 +8.3% Printed directories 100.4 122.1 -17.8% 416.6 490.7 -15.1% Other businesses 6.5 8.7 -25.3% 26.9 35.9 -25.1% Revenues

  60. Slide 60: Revenues and Gross operating margin: Q4 and financial year 2012

    Revenues and Gross operating margin: 4th quarter and financial year 2012 In million euros Q4 2012 Q4 2011* Change 2012 2011* Change Internet 159.4 151.4 +5.3% 622.7 575.0 +8.3% Printed directories 100.4 122.1 -17.8% 416.6 490.7 -15.1% Other businesses 6.5 8.7 -25.3% 26.9 35.9 -25.1% Revenues 266.3 2

  61. Slide 61: Income statement: 4th quarter and financial year 2012

    Income statement: 4th quarter and financial year 2012 In million euros Q4 2012 Q4 2011* Change 2012 2011* Change Revenues 266.3 282.3 -5.7% 1,066.2 1,101.6 -3.2% External purchases (62.8) (77.2) 18.7% (227.1) (255.7) 11.2% Other operating income and expenses (1.6) (2.5) 36.0% (3.5) (7.6) 53.9% Salar

  62. Slide 62: Cash flow statement: 4th quarter and financial year 2012

    Cash flow statement: 4th quarter and financial year 2012 In million euros Q4 2012 Q4 2011* Change 2012 2011* Change GOM 102.7 107.0 -4.0% 464.5 487.9 -4.8% Legal employee profit-sharing (3.1) (3.6) +13.9% (14.7) (14.1) -4.0% Non monetary items included in GOM 2.0 (2.4) na 0.4 1.7 na Net change in wo

  63. Slide 63: Condensed balance sheet as of 31 December 2012

    Condensed balance sheet as of 31 December 2012 In million euros 31 Dec 2012 31 Dec 2011* ASSETS Total non-current assets 212.3 220.8 Net goodwill 82.3 94.1 Other net intangible fixed assets 69.4 66.4 Net tangible fixed assets 25.5 28.2 Other non-current assets of which deferred tax assets 35.1 32.1

  64. Slide 64: Net debt as of 31 December 2012

    Net debt as of 31 December 2012 In million euros 31 Dec 2012 31 Dec 2011 Cash and cash equivalents 111.5 82.7 Gross Cash position 111.5 82.7 Bank overdrafts (19.6) (4.6) Net Cash position 91.9 78.1 Bank borrowings (1,368.2) (1,600.2) Bond borrowings (350.0) (350.0) Revolving credit facility drawn1 (

  65. Slide 65: Financial structure as at 31 December 2012

    Financial structure as at 31 December 2012 Margin (bps) / Size (€M) Maturity Rate (%) Tranche A1 49.6 November 2013 175 Tranche A3 962.0 September 2015 400 Tranche A5 356.4 September 2015 360 RCF 1 22.0 November 2013 175 RCF 31 53.8 September 2015 360 Total Bank debt 1,443.8 - 3772 Senior secured no

  66. Slide 66: Annexes Investor Day

    Annexes Investor Day © Copyright PagesJaunes 2012 65

  67. Slide 67: Controlled decrease in the printed directories business

    CONTROLED DECREASE IN THE PRINTED DIRECTORIES BUSINESS Containement of the Printed directories … due to audience resilience revenues… A controled decrease of revenues ~1 billion consultations of printed compared to other directories peers directories in 20121 A positive regional mix 75% of French pe

  68. Slide 68: Stabilisation of printed directories margins

    STABILISATION OF PRINTED DIRECTORIES MARGINS Efficient monitoring of direct costs Stability in Printed directories GOM Cost control Paper-Print-Distribution (fully outsourced) -17.8% vs 2011 46.8% 45.7% 45.0% Distribution optimisation using phoning campaigns (3.5m phone calls in 2012) Optimising geo

  69. Slide 69: Glossary

    Sobcal GLOSSARY

  70. Slide 70: 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. EXTERNAL PURCHASES: primarily include the editorial costs (purc

  71. Slide 71: Glossary – Financial structure

    GLOSSARY – FINANCIAL STRUCTURE NET FINANCIAL DEBT: total gross financial debt plus or minus the fair value of derivative asset and 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, in o

Solocal Group — Investor Day (February 2013) on 6ix