Television Francaise 1 Sa · EURONEXT:TFI
Television Francaise 1 Sa — TF1 Group — Q1 2018 Earnings Presentation
48 slides from Television Francaise 1 Sa's earnings presentation, 2018
Slide 1: Investor Presentation Post Q1 2018 Results
INVESTOR PRESENTATION POST Q1 2018 RESULTS 1
Slide 2: Forward-looking statements
This presentation contains certain forward-looking statements based on current expectations, forecasts and assumptions that involve risks and uncertainties. These statements are based on information available to the Company as of the date hereof. All forward-looking statements are TF1 management’s p
Slide 3: Table of Contents
TABLE OF CONTENTS 1 - FRENCH TV MARKET (p.4) 2 - Q1 2018 PRESENTATION (p.12) 3 - 2018 CHALLENGES (p.30) 4 - OUTLOOK (p.40) 5 - APPENDIX (p.42) 3
Slide 4: French TV Market
LE GROUPE FRENCH TV MARKET
Slide 5: TV Reception Modes in France
TV RECEPTION MODES IN FRANCE EVOLUTION OF RECEPTION MODES AS A % OF HOUSEHOLDS (Main reception mode as a % of households equipped with TV) 67% 62% 60% 58% 58% 58%* ADSL/fibre reception/Cable 56% 15.4m reception 54% 50% 51% 13.6m DTT reception 47% 46% 45% 45% 49% 48% 12.8m HD DTT reception 45% 43% 41
Slide 6: TV, the Most Consumed Medium in France
TV, THE MOST CONSUMED MEDIUM IN FRANCE FRENCH PEOPLE WATCH NEARLY 4 HOURS OF TV A DAY 03H58 TV Radio Desktops Mobile 03H40 03H42 03H50 03H35 03H27 2Hrs 05mins 56mins 34mins 4+ W<50PDM 3H42 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 o/w 11mins of delayed viewing 31 MILLION INDIVIDUALS REA
Slide 7: New Content Consumption - Zoom 18-34 Years Old
NEW CONTENT CONSUMPTION- ZOOM 18-34 YEARS OLD YOUTUBE FACEBOOK TELEVISION PART OF TV CONTENTS IN VIDEO CONSUMPTION* 8% SVOD 24% YOUTUBE +FACEBOOK VIDEO TIME/DAY 13’ 3’ 2H24’ o/w 8’ of live digital REACH/DAY 36% 58% 61% TV 68% Long sessions on TV, high reach on Facebook but minority of video usage TE
Slide 8: Fragmentation in the French Audiovisual Sector Since 2005
FRAGMENTATION IN THE FRENCH AUDIOVISUAL SECTOR SINCE 2005 National Public NextRadio TV TF1 Group Channels M6 Group Canal+ Group NRJ Group Group Others Lagardère Unencrypted Channels Amaury 2005 2012 2016 6 channels 19 channels 25 channels 27 channels 8
Slide 9: Net French Advertising Market
NET FRENCH ADVERTISING MARKET EVOLUTION OF TV AND DIGITAL* ADVERTISING MARKET (€ BILLION) 1,5 1,2 Digital (display only) 0,6 1,1 0,5 0,6 0,8 0,8 Media net ad revenue (€bn) 2016 2017 DIGITAL 3.5 4.1 -Search and other 2.3 2.6 -Conventional (banners, etc.) 0.7 0.7 3,4 3,5 3,3 3,2 3,2 3,2 3,3 3,3 -Video
Slide 10: French Ad TV Market Evolution Over the Last 6 Years
FRENCH AD TV MARKET EVOLUTION OVER THE LAST 6 YEARS 130 Ad TV Market evolution (2012-2017) 120 Index base 100 = 2012 118 117 est. 114 110 98 100 90 80 70 France UK Germany Spain 60 2012 2013 2014 2015 2016 2017 AdAdTVTV Market Market (per (par 2012 2013 2014 2015 2016 2017 inhabitant) habitant) Fran
Slide 11: Regulation: Current Situation
REGULATION: CURRENT SITUATION OBLIGATIONS TO INVEST OBLIGATIONS TO BROADCAST ✓ 3.2% in the co-production of European cinema works* ✓ Cinema and audiovisual works: 60% European-origin and 40% French origin at least ✓ 12.5% for the commissioning of national heritage audiovisual ✓ A maximum of 192 movi
Slide 12: Q1 2018 Presentation
LE GROUPE Q1 2018 PRESENTATION
Slide 13: A Group with Diversified Activities
A GROUP WITH DIVERSIFIED ACTIVITIES BROADCASTING STUDIOS & ENTERTAINMENT ** *** * 13 *Owned at 50% **Owned at 70% - The acquisition of the residual interest (30%) is subject to clearance from the French Competition Authority ***Owned at 78.07% - Simplified tender offer to come
Slide 14: Share of Viewing Among W<50PDM - Q1 2018
SHARE OF VIEWING AMONG W<50PDM – Q1 2018 Audience share Q1 2018 vs. Q1 2017 (%) +0,2 -0,4 +0,6 +0,9 -0,5 -0,2 -1,1 -0,3 = +0,3 -0,3 = -0,2 +0,1 +0,2 = = +0,2 +0,2 -0,2 = = = = = 22,1 15,2 8,3 4,4 4 3,8 3,5 3,4 2,6 2,5 2,2 2,1 1,9 1,9 1,7 1,6 1,4 1,2 1,1 1 0,9 0,6 0,3 0,2 0,2 TF1 M6 F2 F3 TMC W9 C8 T
Slide 15: Strong Complementarity in the Group's Portfolio of Channels
STRONG COMPLEMENTARITY IN THE GROUP'S PORTFOLIO OF CHANNELS LEADERSHIP FOR SUCCESSFUL CHANNEL REBRANDING MULTICHANNEL & MULTIMEDIA MULTICHANNEL AUDIENCES AND REPOSITIONNING PROGRAMMING 0.2 2.5 3.4 TF1-LCI-Digital co-broadcast of the Grand Entretien* 4.0 Stable vs FY 2017 32.2% September 2016 August
Slide 16: Dynamics of the TF1 Channel's Business Model
DYNAMICS OF THE TF1 CHANNEL’S BUSINESS MODEL POWER AND TARGETING WITH MONETISATION A FIRMLY MULTIMEDIA STRATEGY CONTROLLED COSTS OF THE TF1 POWER RATIO Continuing to deliver gold-standard programming Branding strategy & performance MYTF1 leader for IPTV in 2017 19.8% 22.1% 19.4% Ind. 4+ W<50PDM Ind.
Slide 17: Success of Fresh and Local Programmes
SUCCESS OF "FRESH" AND LOCAL PROGRAMMES ENTERTAINMENT FRENCH DRAMA INFO LCI confirmed its status as TF1 occupied all the 22 entertainment TF1 occupied 32 places with france’s no.2 news channel places in the 100 best 2017 ratings French dramas in the 100 best 2017 ratings News bulletins are leader We
Slide 18: Optimized Content Acquisition Policy
OPTIMIZED CONTENT ACQUISITION POLICY RIGHTS PURCHASES CO-PRODUCTIONS, NEW FINANCING MODES, NEW FORMATS SOURCING POLICY Reduction in the number of output deals Cherry picking Reinforcement of in-house production Une famille formidable Mon plus beau Noël Demain nous appartient French drama New financi
Slide 19: Net Advertising Revenue of the 5 Unencrypted Channels Up 0.3% in Q1
NET ADVERTISING REVENUE OF THE 5 UNENCRYPTED CHANNEL UP BY 0.3 % IN Q1 2018 2017* 2018** INCREASE IN AD REVENUES OF THE 5 UNENCRYPTED CHANNELS: Q1 Q2 Q3 Q4 Q1 +2.6% €349.8m in Q1 2018, + 0.3% +2.0% +1.7% +0.6% +0.3% Q1 2018: + 0.6 points of gross market share +1.7% 19 *Published figures ** In accord
Slide 20: Q1 2018 Trends in Gross Ad Spend for TF1 Group Channels
Q1 2018 TRENDS IN GROSS AD SPEND FOR TF1 GROUP CHANNELS 20 Source: Kantar Média, Q1 2018 vs Q1 2017. Gross advertising spend (excluding sponsorship) for the 5 unencrypted channels
Slide 21: Conquering Saleshouse
CONQUERING SALESHOUSE INCREASED NUMBER OF ADVERTISERS GROWTH IN SPONSORSHIP / SPECIAL OPERATIONS +12.7 % +101 advertisers in 2017 vs 2016 +27 % Billboard revenue in 2017 GOING ON WITH ‘LA BOX’ DEPLOYEMENT AND ADTECH NEW CHANNELS AND TERRITORIES PARTNERSHIP 21
Slide 22: Diversified and Redeployed Entertainment Activities
DIVERSIFIFIED AND REDEPLOYED ENTERTAINMENT ACTIVITIES MUSIC/SHOWS CINEMA LA SEINE MUSICALE 5.6 million entries 5.3 million entries Successful launch of the new Successful launch for the The 4 films co-produced by TF1 Films Production in Q1 2018 Over 450,000 viewers since opening in April 2017 Maître
Slide 23: Production: The Newen Group Continues to Develop
PRODUCTION: THE NEWEN GROUP CONTINUES TO DEVELOP MORE DIVERSIFIED CLIENTS PORTFOLIO SUCCESSFUL CHALLENGE: DEMAIN NOUS APPARTIENT Captured in Sète, South of France Demain nous appartient Un village à la diète 26 Minutes/episod 5 Days a week Souviens toi 350 Technical Staff 3 Film crews SUCCESS ABROAD
Slide 24: Acceleration of the Digital Transformation
ACCELERATION OF THE DIGITAL TRANSFORMATION DEVELOP NEW CONTENT SUPPORTING ADVERTISERS, INNOVATION, DIGITAL TECHNOLOGIES AND INVENTORY NEW TERRITORIES, NEW TARGETS AND DATA 1.3bn Ad agency operational in 18 million videos viewed in 1 year* people identified to date 2018 (x2 since April) to address Eu
Slide 25: TF1 Initiatives: A Unique Brand Highlighting Our CSR Actions
TF1 INITIATIVES : A UNIQUE BRAND HIGHLIGHTING OUR CSR ACTIONS BRINGING TOGETHER THE INITIATIVES OF THE EXPANDING OUR RANGE OF ACTIONS COMMUNICATING WITH AND CHANNELS, THE COMPANY AND TF1 FOUNDATION THROUGH TOUCHSTONE PARTNERSHIPS ENGAGING EMPLOYEES Solidarity Sport Dans la Ville Committed to helping
Slide 26: Consolidated Revenue
CONSOLIDATED REVENUE Q1 2017 Q1 2017 €m Q1 2018* Var. €m** Var. %** restated* published BROADCASTING 402.3 404.9 404.1 (2.6) -0.6% UNENCRYPTED PLATFORMS 364.3 360.6 359.8 3.7 1.0% TV advertising 349.8 348.9 348.0 0.9 0.3% Other revenues 14.5 11.7 11.8 2.8 23.6% OTHER PLATFORMS AND RELATED ACTIVITIES
Slide 27: Cost of Programmes
COST OF PROGRAMMES €m 2018 2017 Var. €m Var. % Entertainment 66.8 69.0 (2.3) -3.3% 24.6% TV dramas/TV movies / Series /Theatre 81.8 65.7 16.2 Sports (excl. One-off sporting events) 10.2 16.1 (6.0) -36.9% News 34.6 37.9 (3.3) -8.6% Movies 34.3 41.6 (7.3) -17.5% Youth 2.3 3.2 (0.8) -26.4% TOTAL EXCL.
Slide 28: Consolidated Income Statements
CONSOLIDATED INCOME STATEMENTS Q1 2017 Q1 2017 €m Q1 2018* Var. €m** Var. %** restated* published CONSOLIDATED REVENUE 499.3 503.4 498.9 (4.1) -0.8% Total costs of programmes (230.0) (233.5) (233.5) 3.5 -1.5% Other charges, depreciation, amortization, provision (231.0) (233.0) (229.1) 2.0 -0.9% CURR
Slide 29: Consolidated Balance Sheet
CONSOLIDATED BALANCE SHEET DEC 31st 2017 DEC 31st 2017 CONSOLIDATED ASSETS (€m) MARCH 31st 2018* Var. €m** Restated* published Total non-current assets 1,049.9 1,068.9 1,060.9 (19.0) Total current assets 2,210.4 2,327.9 2,329.4 (117.5) Held-for-sale assets - - - - TOTAL ASSETS 3,260.3 3,396.8 3,390.
Slide 30: 2018 Challenges
LE GROUPE 2018 CHALLENGES
Slide 31: Exceptional Package for 2018 Football World Cup
EXCEPTIONAL PACKAGE FOR 2018 FOOTBALL WORLD CUP FOOTBALL WORLD CUP UNENCRYPTED EXCLUSIVELY ON TF1 From 14 June to 15 July 2018 A FULL MULTICHANNEL, DIGITAL PACKAGE (Magazines, Téléfoot daily,…) The best 28 matches, including all the French team matches Matches at 8pm that impact TV schedule (11 of 1
Slide 32: Transformation of News: 3 Pillars for the Info 2020 Ambition
TRANSFORMATION OF NEWS: 3 PILLARS FOR THE ‘INFO 2020’ AMBITION ORGANISATION EDITORIAL TOOLS SYNERGIES BETWEEN TEAMS OPTIMISATION OF THE 8:30PM–9:00PM SLOT PROJECTS ON COMMON PRODUCTION AND BROADCASTING TOOLS Reinforcement of news offering, new format, NEW NEWS STUDIO BY SEPTEMBER 2018 clear dates fo
Slide 33: New Content and Services Monetisation: TF1 Premium Offer
NEW CONTENT AND SERVICES MONETISATION: TF1 PREMIUM OFFER 4 AGREEMENTS SIGNED ONGOING NEGOCIATIONS Signed, 30 January 2018 Signed, 6 November 2017 Signed, 25 april 2018 Signed, 8 March 2018 33
Slide 34: Audiovisual Law: Opportunity for Regulation Changes
AUDIOVISUAL LAW: OPPORTUNITY FOR REGULATION CHANGES OUTLOOK JULY 2017 OCTOBER 2017 2018 Renewal of TF1 agreement including Public consultation Audiovisual law to come... some more flexibility on simplifying the rules on TV advertising MAJOR STAKES Media Chronology – financing of the cinema sector Ex
Slide 35: Ongoing Acquisition of Aufeminin Group
ONGOING ACQUISITION OF AUFEMININ GROUP ON 27 APRIL 2018, TF1 GROUP FINALISED THE ACQUISITION OF THE AUFEMININ GROUP FROM AXEL SPRINGER (78.07% OF THE CAPITAL) 35
Slide 36: A Unique Portfolio of High-Awareness Brands
A UNIQUE PORTFOLIO OF HIGH-AWARENESS BRANDS EUROPE (France, Spain, Italy, Germany, UK) UNITED STATES JAPAN Fashion / Beauty Food Parenting Health Lifestyle Fashion / Beauty Lifestyle Interiors Celebrity Lifestyle Business model based on the sale of ‘boxes’ 36
Slide 37: An International Digital Group
AN INTERNATIONAL DIGITALGROUP REVENUE* KEY FIGURES €113.5m in 2017 (+6%) €107m in 2016 EBITDA* Over 155 million users* in the world, of which 20 million in France €21.3m in 2017 - (Margin : 19%) Over 7 million followers on social networks €24.7m in 2016 (Margin : 23%) EBIT* Around 17 million downloa
Slide 38: A Unique Model for the Monetisation of Audiences and Communities
A UNIQUE MODEL FOR THE MONETISATION OF AUDIENCES AND COMMUNITIES 1-REACH 2-ENGAGEMENT 3-CONVERSION Display Brand content Social E-Commerce Programmatic / Header Bidding Brand Publishing Magazine Influence Social Networks Events ADVERTISING MODEL TRANSACTIONAL MODEL B2B Platforms B2C 38
Slide 39: Value-Adding for TF1 and Aufeminin
VALUE-ADDING FOR TF1 AND AUFEMININ 1. e-commerce know-how (marketing of boxes), an 1. Production of content (film/digital) Newen, activity which has huge growth potential TF1 Studios, Studio71 2. Complementary business lines 2. Acceleration of growth, in particular internationally (inc. growth by ac
Slide 40: Outlook
LE GROUPE OUTLOOK
Slide 41: Outlook
OUTLOOK 2018 2018 - 2020 2019 Growth Average annual cost A Group with more diversified revenues: in current operating margin of programmes at Group level (excluding major sporting events) More than one-third of consolidated revenue excluding major sporting events reduced to €960 million will come fr
Slide 42: Appendix
LE GROUPE APPENDIX
Slide 43: Consolidated Revenue
CONSOLIDATED REVENUE €m 2017 2016 Var. €m Var. % BROADCASTING 1,713.6 1,669.9 43.7 2.6% UNENCRYPTED PLATFORMS 1,543.8 1,517.1 26.7 1.8% TV advertising 1,480.5 1,455.3 25.2 1.7% Other revenues 63.3 61.8 1.5 2.4% OTHER PLATFORMS AND RELATED ACTIVITIES 169.8 152.8 17.0 11.1% STUDIOS & ENTERTAINMENT 411
Slide 44: Cost of Programmes
COST OF PROGRAMMES €m 2017 2016 Var. €m Var. % Entertainment 273.9 269.5 4.4 1.6% TV dramas/TV movies / Series /Theatre 325.2 312.1 13.1 4.2% Sports (excl. One-off sporting events) 59.2 49.0 10.2 20.9% News 142.5 140.7 1.8 1.3% Movies 169.0 174.1 (5.1) -2.9% Youth 14.2 15.1 (0.9) -6.1% TOTAL EXCL. O
Slide 45: Consolidated Income Statement
CONSOLIDATED INCOME STATEMENT €m 2017 2016 Var. €m Var. % CONSOLIDATED REVENUE 2,124.9 2,062.7 62.2 3.0% Total costs of programmes 983.9 1,006.6 (22.7) -2.3% Other charges, depreciation, amortization, provision 955.7 926.7 29.0 3.1% CURRENT OPERATING PROFIT 185.3 129.4 55.9 43.2% CURRENT OPERATING M
Slide 46: Consolidated Balance Sheet
CONSOLIDATED BALANCE SHEET CONSOLIDATED ASSETS (€m) DEC 31st 2017 DEC 31st 2016 Var. €m Total non-current assets 1,060.9 1,093.1 (32.2) Total current assets 2,329.4 2,122.6 206.8 Held-for-sale assets - - - TOTAL ASSETS 3,390.3 3,215.7 174.6 Net cash (+) 256.7 186.7 70.0 CONSOLIDATED LIABILITIES (€m)
Slide 47: Returns for Shareholders
RETURNS FOR SHAREHOLDERS 2015 – 2017 EVOLUTION €73.5m * Increase of the dividend per share € 0.35 54% of net profit attributable to the group in 2017 47 * On the basis of the number of shares making up TF1 capital at 12/31/2017
Slide 48: Investor Relations Contacts
IR department Philippe DENERY – CFO Tel: 33-1 41 41 49 73 pdenery@tf1.fr comfi@tf1.fr Ghislain HÜE – Head of Investor Relations TF1 ghue@tf1.fr 1 Quai du Point du Jour Stéphanie LAVAL – Investor Relations 92 656 Boulogne-Billancourt Cedex slaval@tf1.fr France http://www.groupe-tf1.fr/en 48