Cyfrowy Polsat Sa · GPW:CPS
Cyfrowy Polsat Sa — Q4 2023 Earnings Presentation
48 slides from Cyfrowy Polsat Sa's earnings presentation, Apr 11, 2024
Slide 1: Financial results Q4'23 / FY2023
Financial results Q4’23/ FY2023 11 April 2024
Slide 2: Disclaimer
Disclaimer This presentation may include forward-looking statements, understood as all statements (other than statements of historical facts) regarding our financial results, business strategy, plans and objectives pertaining to our future operations (including development plans related to our produ
Slide 3: Speakers
Speakers KATARZYNA OSTAP-TOMANN MIROSŁAW BŁASZCZYK MACIEJ STEC PIOTR ŻAK CFO, MEMBER OF THE MANAGEMENT PRESIDENT OF THE MGMT BOARD VICE-PRESIDENT FOR STRATEGY PRESIDENT, TELEWIZJA POLSAT BOARD FOR ESG 3
Slide 4: Agenda
Agenda 1. Key events in 2023 2. Operating results 3. Financial results 4. Summary of 2023 and objectives for 2024
Slide 5: Key events in 2023
Key events in 2023 Mirosław Błaszczyk President of the Management Board, Cyfrowy Polsat
Slide 6: Key events in 2023 – telco and media
Key events in 2023 – telco and media ● Strategic partnership with Google Cloud – Google signed a 10-year PPA to purchase green energy from the Przyrów wind farm – Cooperation between Polsat Plus Group and Google Cloud based on cloud solutions ● We are increasing coverage of Poland's widest 5G Plus n
Slide 7: Key events in 2023 – Green Energy
Key events in 2023 – Green Energy ● We gained control over PAK-PCE Group ● We launched the first 2 wind farms Kazimierz Biskupi and Miłosław ● We installed an additional 12.4 MW of generation capacity at the Brudzew photovoltaic farm ● We continue the dynamic implementation of Strategy 2023+ in the
Slide 8: Key events in 2023 – Finance
Key events in 2023 – Finance ● We entered into loan agreements with a consortium of Polish and foreign financial institutions for PLN 7.3bn and EUR 0.5bn term loans, as well as a PLN 1bn revolving credit facility ● We successfully placed 3 sustainability-linked bond issues with a total nominal value
Slide 9: Operating results
Operating results
Slide 10: Media segment: TV and online
Media segment: TV and online Piotr Żak President of the Management Board, Telewizja Polsat
Slide 11: Viewership and position in the advertising market in Q4'23
Viewership and position in the advertising market in Q4’23 Market expenditures on TV advertising Audience shares and sponsorship Main channels Thematic channels +0.4% 7.5% 7.7% 16.1% 1,448 1,454 14.5% (mPLN) 5.5% 5.3% share of TV Polsat Group 8.1% 28.3% 28.6% Polsat TVN TVP2 TVP1 POLSAT (1) Warner T
Slide 12: Viewership and position in the advertising market in 2023
Viewership and position in the advertising market in 2023 Market expenditures on TV advertising Audience shares and sponsorship Main channels Thematic channels +3.3% 7.6% 8.0% 14.4% 15.5% 4,509 4,657 (mPLN) 5.6% 5.4% 8.9% share of TV Polsat Group 28.6% 28.6% Polsat TVN TVP2 TVP1 POLSAT (1) Warner TV
Slide 13: Very good results of Polsat's spring schedule
Very good results of Polsat's spring schedule 13
Slide 14: We are effectively building our position in the market of Internet portals
We are effectively building our position in the market of Internet portals ● We are a leading Internet publisher in Average monthly number of users Poland thanks to the acquisition of 21.2 20.8 22.6 21.1 22.1 21.2 18.5 18.9 18.6 17.0 (millions of RU) Interia.pl ● Our leading position in the online m
Slide 15: We doubled EBITDA of Interia.pl Group in years
We doubled EBITDA of Interia.pl Group in 3 years We have achieved the announced synergies PLN +20m EBITDA in first year after the acquisition 2x EBITDA in the medium term EBITDA of Interia.pl Group Average monthly number of users +97% -2% -3% -4% 55 +20m 48 5% 7% Q4'20 20.8 21.8 21.1 21.6 21.2 Q
Slide 16: B2C and B2B services segment
B2C and B2B services segment Maciej Stec Vice President for Strategy, Cyfrowy Polsat
Slide 17: Nearly 2.5 million customers use our multiplay offering
Nearly 2.5 million customers use our multiplay offering ● High base of multiplay customers despite Number of multiplay customers challenging market conditions (thous. customers) 3000 65% 2,462 2,445 2,456 60% ● 2500 As a result of the consistent implementation 2000 42% 42% 55% 50% 41% of the multipl
Slide 18: We provide over 13m contract services
We provide over 13m contract services ● High, stable number of mobile telephony Number of RGUs in the B2C contract segment and Internet access services -1.5% ● The growing number of TV services 13.28m 13.05m 13.08m provided in IPTV and OTT technologies 2.0m 2.0m 2.0m partially offsets the decline in
Slide 19: ARPU growth in B2C thanks to multiplay strategy and 5G tariffs
ARPU growth in B2C thanks to the consistent implementation of our multiplay strategy and popularization of 5G tariffs +2.6% ● 2.6% YoY increase in ARPU results from 73.6 71.7 73.5 3 the consistent building of the value of the 70 existing customer base despite 3 unfavourable market conditions 60 2 50
Slide 20: High base and ARPU of prepaid services
High base and ARPU of prepaid services ● We maintain a high and stable base of Prepaid RGU1 prepaid services 2.69m 2.74m 2.65m ● Stable ARPU at PLN 17.4 (excluding low- margin promotional package in Polsat Box Go) Q4'22 Q3'23 Q4'23 ● ARPU of prepaid services in 2023 at a high, Mobile telephony Inter
Slide 21: Stable base and growing ARPU of B2B customers
Stable base and growing ARPU of B2B customers ● We provide services to 69 thous. B2B Number of B2B customers customers, successfully maintaining the scale 69.1k 68.8k 68.8k of this base ● The successively expanded offer of communication and ICT services enables us Q4'22 Q3'23 Q4'23 to increase ARPU
Slide 22: Green energy segment
Green energy segment Maciej Stec Vice President for Strategy, Cyfrowy Polsat
Slide 23: We want to become a leading producer of clean, green energy and green hydrogen
We want to become a leading producer of clean, green energy and green hydrogen Goal #1: Goal #2: We want to become a leading We want to become a leading producer of clean, green energy producer of green hydrogen Człuchów wind farm Hydrogen station in Warsaw Brudzew/Cambria photovoltaic farm Prototyp
Slide 24: Dynamically implementing strategic initiatives related to clean energy production
We are dynamically implementing strategic initiatives related to the production of clean energy ENERGY FROM BIOMASS SOLAR ENERGY ON-SHORE WIND ENERGY ENERGY FROM WASTE 100 MW >340 MW >296 MW PROCESSING Block #1 Cambria/Brudzew Miłosław Rybnik Capacity: 55 MW 100% Capacity: 82.4 MWp / Output:
Slide 25: Building the full value chain of an economy based on green hydrogen
We are building the full value chain of an economy based on green hydrogen GREEN HYDROGEN STORAGE AND TRANSPORT GREEN HYDROGEN PRODUCTS FOR END-USERS PRODUCTION DISTRIBUTION First 2.5 MW electrolyzer Hydrogen trailer with H2 refueling station in Won tender for delivery 150 H2 cars are in u
Slide 26: We have started production from all energy sources under Strategy 2023+
We have started production from all energy sources under our Strategy 2023+ Renewable energy production ● In Q4'23, we produced 179 GWh of green 168.5 150.1 [GWh] energy: 150 GWh from biomass, 8 GWh from 179 GWh the sun and the first 21 GWh from wind 21.4 +2% YoY 0 8.1 7.8 ● Miłosław and Kazimierz B
Slide 27: We generated our first revenue from the sale of green energy
We generated our first revenue from the sale of the green energy produced Electricity production and average price in Q4'23 ● In Q4'23, we sold 179 GWh of electricity at 179 GWh Production an average price of PLN 692/MWh 692 150 PLN/MWh [GWh] ● In H2'23, we sold 371 GWh of electricity at Average pri
Slide 28: Increasing installed capacity in RES as planned
We are dynamically implementing our Strategy 2023+ by increasing installed capacity in RES as planned Installed capacity in RES ● Thanks to the dynamic implementation 744 +2.5x of investments, we will increase the RES [MW] installed installed capacity in RES 2.5x by 2026 – 484 82 342 capacity 338 fr
Slide 29: Financial results
Financial results Katarzyna Ostap-Tomann CFO, Member of the Management Board for ESG, Cyfrowy Polsat
Slide 30: Financial results of the Group
Financial results of the Group Revenue Adjusted EBITDA1 Net profit +7.3% -17.3% -25.3% 3,682 175 3,430 334 819 130 2 (mPLN) (mPLN) (mPLN) 3,348 675 Q4'22 Q4'23 Q4'22 Q4'23 Q4'22 Q4'23 +5.5% -10.2% -65.4% 13,626 901 12,915 630 3.352 3,012 24 (mPLN) (mPLN) (mPLN) 12,996 2,988 312 2022 2023 2022 2023 2
Slide 31: FCF and net debt/EBITDA LTM in 2023
FCF and net debt/EBITDA LTM in 2023 LTM FCF1 Net debt/EBITDA LTM (excl. project financing) -56.5% 768 3.51x 2.86x (mPLN) 334 2022 2023 2022 2023 Nota: (1) As of Q3'23 FCF additionally adjusted for capex related to the development of strategic projects in the green energy segment 31
Slide 32: Revenue and EBITDA – change drivers
Revenue and EBITDA – change drivers Revenue EBITDA +5.5% | +711m 13,626 3,471 -10% | -340m 12,915 3,352 3,231 -1 -137 +31 +46 +772 -153 +34 3,012 -341 -34 +25 +10 0 +220 including: own energy sales: 267m energy resale: 373m (mPLN) (mPLN) 27% 26% 24% 22% EBITDA margin Revenue Revenue B2C and Medi
Slide 33: In 2023 FCF impacted by high interest costs and inflationary pressure on OPEX
In 2023 FCF impacted by high interest costs and inflationary pressure on OPEX o/w: -168 NWC change o/w: (mPLN) 101 refinancing cost 85 M&A 0 Adjusted Change in Cash used in Interests, FCF’23 Telco One-off Net loans Sale of Adjusted Green Adjusted EBITDA 2023 NWC, Tax investing leasing & after freque
Slide 34: Capex under control: high investments in profitable green energy segment
Capex "under control": capex/revenue in TMT only 7%, high investments in profitable green energy segment Capex by segment in Q4’23 ● In the TMT1 area, the capex/revenue ratio Development Development of the segment remains at around 7% 8% Capex Capex ● 409 The increase in the Group's total capex is 5
Slide 35: The Group's debt
The Group’s debt Debt structure Balance value as at (excl. project financing) mPLN as at 31.12.2023 EUR 31 Dec. 2023 Bonds 16% 31% Loans and borrowings, including: 10,604 Bank loans 69% PLN loans and borrowings liabilities excl. project financing1 9,378 84% project financing liabilities 1,227 Bonds
Slide 36: Summary of 2023 and objectives for 2024
Summary of 2023 and objectives for 2024 Mirosław Błaszczyk President of the Management Board, Cyfrowy Polsat
Slide 37: Summary of 2023
Summary of 2023 Telecommunication and media update ● Growing ARPU of B2C and B2B contract customers and low churn as a result of the effective implementation of our multiplay strategy ● Expansion of 5G and 5G Ultra Plus networks thanks to the unique 2.6GHz TDD frequency and aggregation of 1.8GHz, 2.
Slide 38: Our goals for 2024
Our goals for 2024 o Growing ARPU and maintaining low churn thanks to the multiplay strategy Connectivity o Further development of Plus' 5G network based on our unique frequency in the 2.6 GHz TDD band and a new block in the 3.6 GHz band o Maintaining a very good position in the TV advertising marke
Slide 39: Polsat Q&A
Polsat Q&A
Slide 40: Additional information
Additional information
Slide 41: Results of the B2C and B2B services segment
Results of the B2C and B2B services segment mPLN Q4’23 YoY change ● Revenues under pressure from regulatory, Revenue 2,694 -2% successive reductions in interconnect MTRs and lower equipment sales Operating costs1 2,144 1% ● Operating costs under control in an inflationary environment EBITDA adjusted
Slide 42: Results of the media segment: television and online
Results of the media segment: television and online mPLN Q4’23 YoY change ● Revenues impacted by lower revenue from Revenue 704 -4% sales of licenses and sublicenses ● Operating costs under control Operating costs(1) 550 2% EBITDA 140 -27% EBITDA margin 19.9% -6.1pp Capex 11 -40% Note: (1) Costs exc
Slide 43: Results of the green energy segment
Results of the green energy segment ● Consolidation of PAK-PCE Group results as of July 3, mPLN Q4’23 2023 Revenue 395 ● Segment revenue mainly includes revenue from sales of electricity from production, resale of energy, sales of heat, gas, property rights, particularly certificates of origin, and
Slide 44: Results of the real estate segment
Results of the real estate segment mPLN Q4’23 YoY change ● The real estate segment mainly focuses on Revenue 58 -11% construction projects but it also includes sale, rental and management of own and leased property Operating costs(1) 58 -9% ● Recognition of revenue and expenses from the EBITDA adjus
Slide 45: Revenue structure
Revenue structure mPLN ● Lower wholesale revenue mainly due to lower interconnection revenue, 1,764 Retail revenue resulting from the gradual regulatory reduction of MTR rates, and lower 1,751 1% revenue from the sale of TV sublicenses ● Lower sale of equipment mainly due to very high sales volume
Slide 46: Operating costs structure
Operating costs structure mPLN Technical costs and cost of settlements 862 ● Increase in technical costs and cost of settlements with with telecommunication operators 831 4% telecommunication operators, caused mainly by higher network Depreciation, amortization, impairment 494 maintenance costs, w
Slide 47: Glossary
Glossary RGU (Revenue Single, active and retail revenue generating service of pay TV provided in all types of access technologies, mobile Generating Unit) or fixed-line Internet access, or mobile telephony provided in the contract or prepaid model. A natural person, legal entity or an organizational
Slide 48: Investor Relations
Investor Relations Cyfrowy Polsat S.A. Konstruktorska 4 02-673 Warsaw Email: ir@cyfrowypolsat.pl https://grupapolsatplus.pl