Television Francaise 1 Sa · EURONEXT:TFI
Television Francaise 1 Sa — TF1 Group — Investor Presentation (September 2014)
47 slides from Television Francaise 1 Sa's investor presentation, September 2014
Slide 1: Investor Presentation August / September 2014
INVESTOR PRESENTATION AUGUST / SEPTEMBER 2014
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: Group
GROUP BROADCASTING & CONTENT CONSUMER SERVICES PAY-TV HOME EUROSPORT THEME CHANNELS BROADCASTING CONTENT VIDEO DIVERSIFICATION SHOPPING FRANCE* IN FRANCE FREE-TO-AIR TV E-TF1 * * * OTHER MEDIA * ** ** EUROSPORT TF1 holds a 49% stake in Eurosport INTERNATIONAL International since June 1st, 2014. * Ow
Slide 4: TV consumption remains at a high level
TV CONSUMPTION REMAINS AT A HIGH LEVEL EVOLUTION OF LINEAR TV CONSUMPTION BETWEEN 2000 AND 2014 ON CUMULATIVE JANUARY/MARCH Women<50 PDM*: 3h45, i.e - 16’ vs Jan-June 2013 / -7% Individuals aged 4+ : 3h46, i.e - 9’ vs Jan-June 2013 / -4% Source : Médiamétrie – Médiamat 4 * PDM = Purchase Decision Ma
Slide 5: TV reception modes in France
TV RECEPTION MODES IN FRANCE EVOLUTION OF PENETRATION RATE AS A % OF HOUSEHOLDS (Base: households equipped with TV) 5 Source : Médiamétrie – Home Devices (Since Q1 2014) Médiamétrie / Gfk – Référence des Equipements Multimédias – 2005/2013
Slide 6: Audience share per group in H1 2014
AUDIENCE SHARE PER GROUP IN H1 2014 AUDIENCE SHARE IND 4+ (%) AUDIENCE SHARE WOMEN <50 PDM (%) CHANGE ON H1 2013 -0.3% -1.1% -5.0% = -0.9% -2.7% -1.0% +13.0% 28.9 28.3 13.3 8.1 32.2 18.0 20.5 8.7 TF1 GROUP FTV Group M6 Group C+ Group TF1 GROUP FTV Group M6 Group C+ Group 6 Source: Médiamétrie - Médi
Slide 7: Q2 2014: substantial increase for TF1
Q2 2014 : SUBSTANTIAL INCREASE FOR TF1 CHANGE ON Q2 2013 +0.4pt +0.5pt +0.3pt +0.3pt 7 Source : Médiamétrie – Médiamat – H1 2014
Slide 8: Monthly trend in audience share
MONTHLY TREND IN AUDIENCE SHARE Ind. 4+ MONTHLY TREND IN AUDIENCE SHARE Women <50 PDM 2013 2013 2013 2013 * * Source: Médiamétrie – Médiamat * at 20 July 2014 8
Slide 9: Gross advertising spend at end-June 2014
GROSS ADVERTISING SPEND AT END-JUNE 2014 TREND IN GROSS PLURIMEDIA ADVERTISING SPEND – JAN-JUNE 2014 VS. 2013 +9.0% TOTAL GROSS PLURIMEDIA (excl. INTERNET*): € 12,361 m (+3.3% vs. Jan-June 2013) -1.4% +1.9% +0.2% -2.5% GROSS MARKET SHARE* 33.4% 24.4% 15.0% 8.8% 1.2% PLURIMEDIA REMINDER NET CHANGE Q1
Slide 10: TF1 Group: trend in advertising volumes
TF1 GROUP: TREND IN ADVERTISING VOLUMES Trend in volume of advertising broadcast on the four free-to-air channels (TF1, TMC, NT1 and HD1 / y-o-y change) H1 2013 H1 2014 10 Source: Kantar Media - excl. HD1 for 2013/2012 change
Slide 11: TF1 Group: trend in advertising on free-to-air channels
TF1 GROUP: TREND IN ADVERTISING ON FREE-TO-AIR CHANNELS Net advertising revenue for TF1, TMC, NT1 and HD1 (y-o-y change) Q1 2013 Q2 2013 H1 2013 Q4 2013 Q2 2014 H1 2014 Q3 2013 Q1 2014 11
Slide 12: Strong brands and success in all genres
, : STRONG BRANDS AND SUCCESS IN ALL GENRES 6.0 million TV viewers on average in prime time 89% of leading prime-time shows ENTERTAINMENT CINEMA US SERIES FRENCH DRAMA NEWS 10.1m, highest 13.0m, a Bienvenue chez les Ch’tis: 8 o’clock: 10.8m, 1 o’clock: Person of interest: Ce soir je vais tuer record
Slide 13: 2014 World Cup sets ratings records
2014 WORLD CUP ON SETS RATINGS RECORDS THE 28 TOP MATCHES ON TF1 including the final, semi-finals and 3 quarterfinals 16.9M viewers for the France/Germany quarterfinal, the highest ratings all categories combined since October 2007 16.1M viewers for France’s 5 matches 13.6M for the final between Ger
Slide 14: Revamped acquisition strategy
REVAMPED ACQUISITION STRATEGY FRENCH DRAMA SERIES & FILMS ‣Optimisation of production obligations Ì Contracts secured with US studios Ì Work in new genres Ì Successful new series & films launched in 2013 Ì Opening up to new slots Ì Unit prices renegotiated NON-SCRIPTED PROGRAMMES ‣New supply strateg
Slide 15: TMC & NT1: highlights in H1 2014
TMC & NT1: HIGHLIGHTS IN H1 2014 3.7% share of women<50 PDM, stable y-o-y +7% share of women<50 PDM 790k prime-time viewers 510k prime-time viewers TRANSPORTER 2 BACHELOR 2.0m, and 1.6m for Pirates of the Caribbean 2 a high of 1.1m, 5% women<50 PDM 90’ ENQUÊTES: CLIENT LIST Continued strength, Tuesd
Slide 16: HD1 DTT leader on individuals and women<50 PDM
HD DTT LEADER ON INDIVIDUALS AND WOMEN< 50 PDM ` 1% audience share 4+ since April 2014 ` No. 1 HD DTT channel in prime time ` 700,000 viewers for Lethal Weapon 3 The only HD DTT channel to top the The only HD DTT channel to top the mark of The only HD DTT channel to draw over monthly 1.0% audience s
Slide 17: TV is the No. 1 media in France in reach and use
TV IS THE No. 1 MEDIA IN FRANCE IN REACH AND USE IN 2013 TV VIEWERS REACHED IN ONE MONTH MONTHLY UNIQUE VISITORS 60.8 (= population aged 4+) 60.8 (= population aged 4+) 58.0 56.1 TTV INTERNET 44.2 40.0 1h41 30.6 4h59 25.6 2h49 14.3 0h42 9.1 1h25 0.0 0.0 VIEWING TIME TIME SPENT PER MONTH 49h 141h PER
Slide 18: Digital power on every screen in 2013
DIGITAL POWER ON EVERY SCREEN IN 2013 ‣ ORIGINAL MODEL, STRONG BRAND 1.4 billion 9 millions free online videos watched on TF1 group sites in downloads at end-December, 2013 all apps combined 8 million 20 million subscribers to TF1 accounts unique visitors a month and programmes in 2013 for MYTF1.fr
Slide 19: E-TF1 maintains high profitability at end-June 2014
E-TF1 MAINTAINS HIGH PROFITABILITY AT END-JUNE 2014 E-TF1 REVENUE AND CURRENT OPERATING MARGIN SINCE Q1 2013 E-TF1 KEY FIGURES SINCE 2008 Revenue (€m) Current op. profit (€m) Current op. margin (%) ` Strong audience performances on MYTF1.fr TF1 is the no. 4 group in terms of time spent by web users
Slide 20: Content: increase in H1 2014
CONTENT: INCREASE IN H1 2014 TOP-QUALITY LINE-UP COPRODUCTIONS : A POPULAR SUCCESS • 4 films released in theaters in H1 2014, • 10 films released in theatres in H1 2014, for a total including Dallas Buyers Club, winner 22.5 million tickets. of 3 Oscars, and Qu’est-ce qu’on a • 5 films had topped the
Slide 21: Positive momentum for Consumer Services
POSITIVE MOMENTUM FOR CONSUMER SERVICES HOME SHOPPING IN A MORE POSITIVE CYCLE • Growth for Téléshopping show • Store activity up significantly, boosted by the opening of Evry 2 in March 2014 TF1 ENTREPRISES BUILDS PERFORMANCE THROUGH STRONG BRANDS • Controlled overheads • Innovation: 1st T-Commerce
Slide 22: Strategic partnership with Discovery / key areas
A STRATEGIC PARTNERSHIP / 3 KEY AREAS DEVELOPMENT DEVELOPMENT OF THE DEVELOPMENT OF EUROSPORT BUSINESS PUBLISHING BUSINESSES OF PAY-TV OF PRODUCTION BUSINESSES CHANNELS IN FRANCE ‣2013: rollout of common operational and organisational initiatives Ì Expertise and skills shared with ‣Advertising for D
Slide 23: Financial information
FINANCIAL INFORMATION The results presented thereafter comply with international financial reporting standards (IFRS). As a result of applying IFRS 5 and IFRS 11, the 2013 first-half and full-year financial statements have been restated as described below. Consequently, detailed contributions from t
Slide 24: Consolidated revenue evolution
CONSOLIDATED REVENUE EVOLUTION €m H1 2014 H1 2013 Var. €m Var. % FY 2013 BROADCASTING & CONTENT 866.1 846.3 +19.8 +2.3% 1,729.0 Broadcasting 802.4 814.7 (12.3) -1.5% 1,656.0 Content 63.7 31.6 +32.1 x 2.0 73.0 CONSUMER PRODUCTS 91.6 100.6 (9.0) -8.9% 205.1 TF1 Vidéo 20.5 29.9 (9.4) -31.4% 58.0 Télésh
Slide 25: Advertising revenue evolution
ADVERTISING REVENUE EVOLUTION €m H1 2014 H1 2013 Var. €m Var. % FY 2013 AD. REVENUE – BROADCASTING & CONTENT 762.3 770.6 (8.3) -1.1% 1,572,1 o/w TV 721.0 728.5 (7.5) -1.0% 1,488.0 o/w Other platforms 41.3 42.1 (0.8) -1.9% 84.1 AD. REVENUE – PAY-TV 7.6 11.9 (4.3) -36.1% 22.2 o/w Eurosport group 3.7 4
Slide 26: Cost of programmes evolution
COST OF PROGRAMMES EVOLUTION €m H1 2014 H1 2013 Var. €m Var. % FY 2013 TOTAL COST OF PROGRAMMES 512.6 491.5 +21.1 +4.3% 946.7 ONE-OFF SPORTING EVENTS 55.7 - +55.7 ns - TOTAL EXCL. ONE-OFF SPORTING EVENTS 456.9 491.5 (34.6) -7.0% 946.7 Entertainment 148.6 143.6 +5.0 +3.5% 285.1 TV dramas / TV movies
Slide 27: Consolidated income statement (1/2)
CONSOLIDATED INCOME STATEMENT(1/2) €m H1 2014 H1 2013 Var. €m Var. % FY 2013 CONSOLIDATED REVENUE 1,025.7 1,019.7 +6.0 +0.6% 2,075.3 Total costs of programmes (512.6) (491.5) (21.1) +4.3% (946.7) Other charges, depreciation & (488.9) (485.6) (3.3) +0.7% (981.9) amortisation CURRENT OPERATING PROFIT
Slide 28: Phase II of optimisation plan: report on progress
PHASE II OF OPTIMISATION PLAN : REPORT ON PROGRESS €85m RECURRING SAVINGS €155m RECURRING SAVINGS €15m €41m €10m €19m €8m €22m €3m PROG. COST OPTIMISATION €7m PHASE I €9m €4m €3m PRODUCTIVITY €12m €7m €10m OVERHEADS 30/06/2012 31/03/2014 30/06/2014 31/12/2007 31/12/2011 31/12/2012 31/12/2013 31/12/2
Slide 29: Current operating profit breakdown
CURRENT OPERATING PROFIT BREAKDOWN €m H1 2014 H1 2013 Var. €m Var. % FY 2013 BROADCASTING & CONTENT 11.5 28.6 (17.1) -59.8% 101.6 Broadcasting 0.6 25.9 (25.3) ns 92.8 Content 10.9 2.7 +8.2 ns 8.8 CONSUMER PRODUCTS 7.0 4.8 +2.2 +45.8% 25.3 TF1 Vidéo 0.8 2.7 (1.9) -70.4% 0.8 Téléshopping 3.6 0.4 +3.2
Slide 30: Consolidated income statement (2/2)
CONSOLIDATED INCOME STATEMENT(2/2) €m H1 2014 H1 2013 Var. €m Var. % FY 2013 OPERATING PROFIT 24.2 42.6 (18.4) -43.2% 146.7 Cost of net debt 0.4 0.2 +0.2 x2 0.4 Other financial income and expenses 0.2 0.2 - - 0.8 Income tax expense (9.7) (11.4) +1.7 -14.9% (45.2) Share of profits / (losses) of assoc
Slide 31: Consolidated balance sheet
CONSOLIDATED BALANCE SHEET ASSETS (€m) 30/06/2014 31/12/2013 Var. €m Total non-current assets 1,350.1 873.3 +476.8 Total current assets 2,395.5 2,126.4 +269.1 Held-for-sale assets - 645.6 (645.6) TOTAL ASSETS 3,745.6 3,645.3 +100.3 SHAREHOLDERS’ EQUITY AND LIAB. (€m) 30/06/2014 31/12/2013 Var. €m Sh
Slide 32: Very strong financial structure
VERY STRONG FINANCIAL STRUCTURE €m Net cash * * From continuing operations 32
Slide 33: Consolidated cash flow statement
CONSOLIDATED CASH FLOW STATEMENT €m H1 2014 H1 2013 Var. €m FY 2013 Operating cash flow 53.3 67.6 (14.3) 178.8 Income taxes (paid)/reimbursed (10.1) (23.1) +13.0 (48.8) Change in operating working capital needs 2.1 10.0 (7.9) (70.0) Net cash generated by/(used in) operating activities 45.3 54.5 (9.2
Slide 34: Dividend and yield
DIVIDEND AND YIELD Dividend paid (€ per share) Yield (average of TF1 share price during the year) 0.85 0.55 0.55 0.55 0.55 0.47 0.43 7.3% 5.2% 4.5% 4.5% 4.8% 3.7% 3.6% 2007 2008 2009 2010 2011 2012 2013 34
Slide 35: Outlook
OUTLOOK
Slide 36: The short-term outlook
THE SHORT-TERM OUTLOOK NO SIGNS OF ECONOMIC RECOVERY IN FRANCE INCREASE IN VOLUME OF ADVERTISING BROADCAST ON DTT LINE-UP WITH STRONG AND CONFIRMED BRANDS FOR THE SECOND HALF OF THE YEAR CONTINUED INNOVATION IN DIGITAL COST OPTIMISATION PLAN: €19M TO BE ACHIEVED IN H2 2014 36
Slide 37: The medium-term outlook
THE MEDIUM-TERM OUTLOOK A STILL STRONG LEADING POSITION UNCHANGED MANAGEMENT DISCIPLINE REGULATORY CHANGES NEED TO BE INTRODUCED PROJECTS FOR THE FUTURE: 9 Change business model in our core business 9 LCI / Metro 9 Growth / development A GROUP FOCUSED ON ITS MODEL AND SEEKING OUT OPPORTUNITIES 37
Slide 38: A clear strategy
A CLEAR STRATEGY 1 FULLY AWARE OF THE CHALLENGES THE GROUP WILL 2 FREED FROM SEVERAL CONSTRAINT KEEP IMPROVING ITS BUSINESS, ITS MODEL AND 3 STRENGTHENED BY NEW RESOURCES ITS PROFITABILITY 4 READY TO SEIZE AND CREATE NEW OPPORTUNITES 38
Slide 39: The TF1 Group benefits from real assets
THE TF1 GROUP BENEFITS FROM REAL ASSETS ‣ Unprecedented financial strength ‣ Capacity for long-term investment (organic or external) in new, complementary, original activities ‣ Tight cost management is in the Group’s genetic make-up ‣ Experienced teams in all our activities ‣ Even tighter managemen
Slide 40: Three priorities for cash usage
THREE PRIORITIES FOR CASH USAGE ORGANIC AND KEEP A STRONG RETURN TO POTENTIALLY FINANCIAL STRUCTURE SHAREHOLDERS EXTERNAL GROWTH CAUTION AND DETERMINATION 40
Slide 41: Appendix
APPENDIX 41
Slide 42: TF1 channel, a European leader (1/2)
TF1 CHANNEL, A EUROPEAN LEADER (1/2) Audience share (in%) of European channels, leaders in their respective national territories in 2014 Gap between each leader and its challenger LEADER TF1 CHALLENGER FRANCE 2 8,9 pts LEADER BBC 1 7,1 pts CHALLENGER ITV1 LEADER ZDF CHALLENGER DAS 1 0,9 pt LEADER TE
Slide 43: TF1 channel, a European leader (2/2)
TF1 CHANNEL, A EUROPEAN LEADER (2/2) Audience share (in%) of private European channels, leaders in their respective national territories over Jan-June 2014 TF1 CANALE 5 TELECINCO ITV ANTENA 3 RTL M6 SAT.1 LA SEXTA CUATRO ITALIA 1 PRO 7 VOX RETE 4 Source : Médiamétrie – 4 years & over (France) / Euro
Slide 44: FY 2013: audiences up, costs down
FY 2013: AUDIENCES UP, COSTS DOWN For 2008: programming cost excluding sports events on TF1 channel - For 2012 & 2013: cost of programmes excluding sports events on the four channels (TF1 + TMC + NT1 + HD1) Sports events For 2008: TF1 channel audience share (Individuals aged 4+) - For 2012 & 2013: G
Slide 45: Eurosport: a model of value creation
EUROSPORT: A MODEL OF VALUE CREATION NUMBER OF HOUSEHOLDS (in millions) 2007 2013 CURRENT OPERATING MARGIN (EUROSPORT GROUP) 2007 2013 ‣AND AT END-2013: 17 M APPS DOWNLOADED 23 M UNIQUE VISTORS A MONTH ON GROWTH SET TO CONTINUE THROUGH THE PARTNERSHIP WITH DISCOVERY 45
Slide 46: Evolution of the advertising sectors for TF1 Group's FTA channels
EVOLUTION OF THE ADVERTISING SECTORS FOR TF1 GROUP’S 4 FTA CHANNELS +12.6% +6.6% +2.9% -0.3% +3.8% -3.8% +17.7% +3.1% GROSS AD REVENUE FOR TF1 FTA CHANNELS: +5.7% (1ST HALF 2014 VS. 1ST HALF 2013) +17.0% +13.3% Source: Kantar Media Jan – June. 2014 vs. Jan – June 2013 46
Slide 47: Contacts
CONTACTS Philippe DENERY – CFO IR department pdenery@tf1.fr tel: 33-1 41 41 27 32 Christine BELLIN – Head of Investor Relations Fax : 33-1 41 41 29 10 cbellin@tf1.fr comfi@tf1.fr Louis IGONET – Deputy Head of Investor Relations TF1 ligonet@tf1.fr 1 quai du Point du Jour 92 656 Boulogne-Billancourt C