Kinepolis Group Nv · EURONEXT:KIN
Kinepolis Group Nv — FY2017 Earnings Presentation
50 slides from Kinepolis Group Nv's earnings presentation, Feb 28, 2018
Slide 1: Kinepolis Group Results 2017
Kinepolis Group Results 2017 February 28, 2018
Slide 2: Business review 2017
Business review 2017 CEO, Mr. Eddy Duquenne
Slide 3: Key Financials
KEY FINANCIALS €m YE 2017 YE 2016 % Better / ‐Worse Revenue 355,4 324,9 9,4% Visitors (‘000) 25.290 23.818 6,2% EBITDA 103,2 91,6 12,6% REBITDA 104,3 94,6 10,3% REBITDA Margin € 4,12/Vis 29,3% € 3,97/Vis 29,1% 24 bps EBIT 72,9 63,2 15,4% REBIT 74,0 66,7 10,9% REBIT Margin 20,8% 20,5% 28 bps Profit 4
Slide 4: Financial Highlights
financial highlights Revenue up by 9,4% with 6,2% more visitors Increase Visitors (+6,2%) Increase Box Office (+9,5%) Increase In‐theatre Sales (+16,6%) Increase B2B (+2%) Stable Sales and Events (‐0,5%) Increase Screen Advertising (+15%) Increase Brightfish (+4,3%) Less r
Slide 5: Strategic Pillars
strategy 2017 results reflect Strategic Pillars set out in 2008 Best Marketer Best Cinema Operator Best Property Manager Further development and implementation of strategy in 2018 5
Slide 6: Major events
Major events Eddy Duquenne received ‘International Exhibitor of the Year’ award at CineEurope Belgian Competition Authority partially withdraws behavioral measures imposed since 1997 (appeal pending) Further steps in expansion strategy March 2017: Utrecht fully operational (partial opening i
Slide 7: Kinepolis Group today
kinepolis group today 11 3 Market Complexes in Ownership Countries Complexes Screens Share ** # %Visitors Belgium 11 138 47% 10 98% France 11 128 4% 9 96% Spain 6 99 5% 2 46% The Netherlands 17 +2 117 +13 9% 9 66% Luxembourg 3 22 90% 1 63% Switzerland 1 8 1% 1 100% Poland * 1 18 1 n/a Canada 44 +44
Slide 8: Realized acquisitions and greenfields (2014-2018)
REALIZED ACQUISITIONS AND greenfields (2014 – 2018) Country City # Complexes # Screens Est. Visitors / Year Realized Spain Alicante 1 16 1,0 mio Q2 2014 Alcobendas ‐ Madrid 1 12 Nevada – Granada 1 8 0,4 mio Q4 2016 The Netherlands Wolff Bioscopen 9 46 1,6 mio Q3 2014 Acq. Building Enschede (Wolff) Q
Slide 9: Planned greenfields
planned greenfields* Country City # Screens Est. Visitors / Year Estimated opening The Netherlands Den Bosch 7 0,4 mio Q2 2018 Schalkwijk Haarlem 6 0,3 mio Q2 2019 France Brétigny‐sur‐Orge 10 0,5 mio Q3 2018 Canada Fort McMurray** 8 ‐ Q2 2018 Saskatoon 7 0,3 mio Q2 2018 Calgary (Alberta) 5 0,3 mio Q
Slide 10: Revenue by country
revenue by country Switzerland Luxembourg Poland Canada* Switzerland 4,3% Luxembourg 1,4% 3,4% Poland 4,4% 1,4% The The Netherlands Netherlands 11,1% 12,4% Belgium Belgium € 355,4m Spain € 324,9m Spain 45,5% 48,3% 13,0% 12,3% France 21,8% France 20,7% YE 2017 YE 2016 * 3 weeks in 2017 10
Slide 11: Revenue by activity
revenue by activity Brightfish Brightfish Real Estate Film Distribution Film Distribution 3,4% 3,6% 3,8% 1,1% Real Estate 1,5% 3,8% B2B * 13,7% B2B * 14,6% € 355,4m € 324,9m Box Office Box Office 54,0% 54,1% In‐theatre Sales In‐theatre Sales 23,9% 22,4% YE 2017 YE 2016 * Including Cinema Screen Adve
Slide 12: Visitors
visitors Visitors (000's) YE 2017 % of Tot YE 2016 % of Tot % ∆ YoY Belgium 8.428 33,3% 8.432 35,4% 0,0% France 7.053 27,9% 7.036 29,5% 0,2% Spain 4.397 17,4% 4.420 18,6% ‐0,5% The Netherlands 3.177 12,6% 2.752 11,6% 15,4% Luxembourg 1.044 4,1% 1.052 4,4% ‐0,8% Switzerland 121 0,5% 126 0,5% ‐4,0% Ca
Slide 13: Top 5 movies
movies Top 5 Movies 2017 3D Visitors (000's) Top 5 Movies 2016 3D Visitors (000's) 1. Star Wars: Episode VIII ‐ The Last Jedi 816 1. Finding Dory 622 2. Despicable Me 3 785 2. Fantastic Beasts And Where To Find Them 621 3. Beauty and the Beast 762 3. The Jungle Book 612 4. Fast & Furious
Slide 14: Ratios
ratio’s REBITDA Margin ROCE Gearing 35% 1,60 30,3% 30,2% 25% 22,9% 1,40 1,32 1,27 29,1% 29,3% 30% 28,3% 20,9% 21,5% 1,13 1,13 1,20 20% 17,9% 17,3% 1,00 0,84 25% 15% 0,80 20% 0,60 10% 0,40 15% 5% 0,20 10% 0% 0,00 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 14
Slide 15: Net financial debt evolution
net financial debt evolution €m YE 2017 YE 2016 Better/‐Worse % Better/ ‐Worse Net Financial Debt (NFD) 224,3 169,8 ‐54,6 ‐32,1% Leverage ratio*: NFD/REBITDA 2,15 1,79 € 250 3,5 3,0 € 200 2,5 € 150 2,0 €m € 100 1,5 1,0 € 50 0,5 €0 0,0 YE 2013 YE 2014 YE 2015 YE 2016 YE 2017 * Not Bank definition REB
Slide 16: Dividend payment
dividend payment +3,4% Dividend/Share € 0,87 € 0,90 Based on Net Income: € 49,1 m 0,9 € € 0,79 0,8 € € 0,69 Payout ratio: 50 % 0,7 € € 0,64 0,6 € # Dividend eligible shares: 27.111.003* € 0,47 0,5 € 0,4 € € 0,36 € 0,90* per share 0,3 € € 0,25 € 0,18 14th year increase consecutively 0,2 € €
Slide 17: Line-up 2018
Line-up 2018 2D 3D Major sequels • 50 Shades Freed (Q1) • The Maze Runner: The Death Cure (Q1) • Black Panther (Q1) • Avengers: Infinity War (Q2) • Mamma Mia! Here We Go Again (Q3) • Han Solo (Q2) • X‐Men: Dark Phoenix (Q4) • Jurassic World: Fallen Kingdom (Q2) • How the Grinch Stole Christmas (Q4)
Slide 18: Financial Review 2017
Financial Review 2017 CFO, Mr. Nicolas De Clercq
Slide 19: Revenue by country
Revenue by country Revenue €m YE 2017 % of Tot YE 2016 % of Tot % ∆ YoY % ∆ Y Vis Belgium 161,9 45,5% 156,8 48,3% 3,2% 0,0% France 73,4 20,7% 70,9 21,8% 3,6% 0,2% Spain 43,7 12,3% 42,3 13,0% 3,2% ‐0,5% The Netherlands 44,0 12,4% 35,9 11,1% 22,5% 15,4% Luxembourg 15,3 4,3% 14,3 4,4% 7,3% ‐0,8% Other
Slide 20: Evolution Box Office
Evolution Box OFFICE * Box Office revenue after deduction of indirect taxes, including VPF revenue 20
Slide 21: Evolution In-theatre Sales
In-theatre Sales 72,9 2016 85,0 2017 ae 5,00 € 4,50€ 4,00 € 3,50€ 3,00€ 2,50€ 2,00 € 150€ 1,00€ 3,08 2013 ITS / Visitor 2,84 2014 3,00 2015 3,06 2016 3,36 2017 * KINEPOLIS”
Slide 22: B2B revenue
B2B revenue * Excluding Brightfish * Excluding Brightfish 22
Slide 23: Real estate
€m 15 13 11 oO N uw Ww YE 2016 13,6 YE 2017 KINEPOLIS”
Slide 24: Brightfish
€m 14,0 12,0 10,0 8,0 6,0 4,0 2,0 0,0 11,6 12,1 ; . YE 2016 @ Screen Advertising YE 2017 m™Sales & Events * KINEPOLIS”
Slide 25: Film distribution
Film distribution # releases 34 31 25
Slide 26: Revenue by activity
Revenue by activity -0,3% +7,3 +9,5% +9,2% +38,0% -12,8% +11,3% €m +9,5% +16,6% ‐0,5% +15,0% +4,3% ‐23,5% +11,4% 400 324,9 16,7 12,1 ‐0,2 1,2 0,5 ‐1,2 1,4 355,4 350 300 250 200 150 100 50 Business line Cinema 0 YE 2016 Box In‐theatre Sales & Screen Brightfish Film Real YE 2017 Office Sales Events Ad
Slide 27: Current operating costs
Current operating costs €m YE 2017 YE 2016 % Better / ‐Worse Current Marketing & Selling expenses ‐20,1 ‐18,0 ‐11,8% Current Administrative Expenses ‐21,2 ‐17,1 ‐24,5% Current Other Operating Income / Cost 1,0 0,8 25,1% Current Operating Costs ‐40,4 ‐34,3 ‐17,8% Non‐Current Operating Costs ‐0,1 ‐2,7
Slide 28: Non-current items
Non-Current items €m YE 2017 YE 2016 Dismissal fees ‐0,7 ‐0,7 Legal fees ‐1,6 ‐0,4 Expansion costs ‐0,5 ‐1,7 Reversal accrual Poland: penalty and zoning change fee ‐ 0,1 Gain / Loss on disposal PPE 1,7 ‐0,1 Other ‐0,1 ‐0,1 EBITDA ‐1,2 ‐2,9 Provision dismissal fees 0,1 ‐0,6 Provisions 0,1 ‐0,6 Financ
Slide 29: Evolution REBITDA per visitor
Evolution Rebitda* per visitor 8,00 € 6,96 7,00 € 6,55 6,00 € 5,04 5,00 € 4,12 3,97 +3,9% 3,95 4,00 € 3,55 3,67 3,33 3,45 2,93 3,00 € 2,62 2,61 2,00 € 1,00 € 0,00 0,00 € YE 2016 YE 2017 Belgium* France Spain The Netherlands Luxembourg Canada Group * Per country excluding corporate entities, KFD & Br
Slide 30: REBITDA by country
Rebitda by country % Better / ‐ €m YE 2017 % of Total YE 2016 % of Total % ∆ Y Vis Worse Belgium 44,0 42,1% 43,7 46,2% 0,5% 0,0% France 25,9 24,8% 25,0 26,4% 3,8% 0,2% Spain 11,5 11,0% 11,6 12,2% ‐0,8% ‐0,5% The Netherlands 12,5 12,0% 9,2 9,7% 37,0% 15,4% Luxembourg 5,3 5,0% 3,6 3,8% 45,1% ‐0,8% Swi
Slide 31: REBITDA & REBITDAR
Rebitda & REBITDAR * ** Belgium 41,0% 41,7% 41,7% 42,4% * France 35,1% 36,0% 35,2% 36,5% * Spain 27,1% 36,2% 26,1% 36,5% * The Netherlands 25,5% 31,0% 28,5% 32,7% * Luxembourg 25,4% 29,0% 34,4% 38,0% Switz. & Poland 32,5% 40,2% Canada0,0% 0,0% 25,9% 35,2% #DIV/0! Total 29,1% 31,8% 29,3% 32,3% YE 201
Slide 32: Depreciation, amortization, provisions
Depreciation, amortization, provisions €m 0 ‐5 ‐10 ‐15 ‐20 ‐25 ‐30 ‐28,4 ‐0,6 ‐27,8 ‐2,5 ‐30,3 0,0 ‐30,3 ‐35 YE 2016 Non‐current YE Current YE 2016 Normal Current YE 2017 Non‐current YE YE 2017 2016 diff's 2017 32
Slide 33: Financial result
Financial result €m YE 2017 YE 2016 % Better / ‐Worse Interest Expense ‐7,39 ‐6,80 ‐8,7% Other (CNC, Derivates, FX) ‐0,83 ‐0,82 ‐0,7% Financial (Cost) / Income ‐8,21 ‐7,62 ‐7,8% €m 0,00 ‐2,00 ‐4,00 ‐6,00 ‐8,00 ‐7,62 ‐0,07 ‐0,59 0,07 ‐8,21 ‐10,00 YE 2016 Interest FX Other YE 2017 33
Slide 34: Taxes
taxes €m YE 2017 YE 2016 % Better / ‐Worse Profit before taxes 64,7 55,6 16,4% Taxes ‐15,6 ‐16,6 5,9% Profit from discontinuing operations 0,0 8,7 0,0% Profit 49,1 47,6 3,0% Effective Tax Rate ('ETR') 24,2% 29,9% ‐574 bps Non‐current items 4,8 ‐2,1 ‐330,9% Current Effective Tax Rate ('CETR') 31,3% 3
Slide 35: EPR
EPR • On 11 January 2016, The European Commission published a decision that a purported regime of Belgian tax rulings with regard to ‘Excess Profit’ (EPR) should be considered as illegal state aid. The European Commission’s decision requires the Belgian government to asses back taxes from companies
Slide 36: REBITDA to net result
Rebitda to net result €m 120,0 104,3 ‐30,3 100,0 80,0 74,0 ‐8,8 ‐20,4 60,0 4,3 49,1 40,0 20,0 0,0 REBITDA YE 2017 Current REBIT YE 2017 Current Current Other Non‐current Result YE 2017 Depr, financial taxes items Amort, result Prov 36
Slide 37: Investments
investments €m YE 2017 YE 2016 Belgium 11,0 6,5 France 3,0 3,3 Spain 1,8 1,3 The Netherlands 3,1 1,5 Luxembourg 1,1 0,1 Other 0,3 0,1 Canada 0,2 0,0 Maintenance & Internal Expansion 20,6 12,8 External Expansion 95,7 71,7 €m TOTAL 116,3 84,5 95,7 100,0 80,0 71,7 60,0 40,0 20,0 10,6 8,2 10,0 4,6 ‐ MAI
Slide 38: Free cash flow YE 2017 vs YE 2016
Free Free cashcash flow: flow: [YTD]vs YE 2017 vsYE [Y-1TD] 2016 €m 80,0 5,7 ‐5,8 70,0 11,3 ‐2,5 0,1 62,5 ‐3,1 59,4 60,0 53,6 50,0 40,0 30,0 20,0 10,0 0,0 FCF YE 2016 EBITDA Income Tax Working Capex ‐ Interest FCF YE 2017 excl EPR payment FCF YE 2017 Paid (excl EPR Capital Maintenance Paid EPR payme
Slide 39: Net financial debt evolution
Net financial debt evolution €m YE 2017 YE 2016 Better/‐Worse % Better/ ‐Worse Net Financial Debt (NFD) 224,3 169,8 ‐54,6 ‐32,1% Leverage ratio*: NFD/REBITDA 2,15 1,79 m€ ‐169,8 ‐224,3 0,0 ‐50,0 ‐24,1 100,5 1,0 ‐116,3 ‐100,0 ‐150,0 15,8 ‐23,7 ‐200,0 ‐7,6 ‐250,0 NFD YE 2016 EBITDA + Taxes Working Inv
Slide 40: Maturity profile financial debt
Maturity profile financial debt € 120.000.000 RCF 5Y* 90.000.000 Priv. Plac. 8Y (December) 60.000.000 100.000.000 Bond 7Y Priv. Plac. 7Y 80.000.000 59.122.000 61.400.000 Priv Plac. 10Y 65.000.000 60.000.000 40.000.000 Term loan Bond 8Y Priv Plac. 10Y (January) (yearly) 15.878.000 34.600.000 20.000.0
Slide 41: Balance sheet
Balance sheet €m 31/12/2017 % of Total 31/12/2016 % of Total €m 31/12/2017 % of Total 31/12/2016 % of Total Intangible assets 9,0 1,3% 5,9 1,2% Capital & share premium 20,1 2,8% 20,1 4,0% Goodwill 86,4 12,0% 53,3 10,6% Consolidated reserves 157,6 21,9% 130,9 26,0% Property, plant & equipment 390,0 5
Slide 42: Shareholders
shareholders 23/02/2018 15/11/2017 # Shares % # Shares % Total shares outstanding 27.365.197 100% 27.365.197 100% Reference Shareholders & Free Float # Shares % # Shares % Kinehold Bis, Pentascoop and Mr. Joos Bert 13.254.590 48,44% 13.254.590 48,44% Treasury shares (own shares) 254.194 0,93% 132.34
Slide 43: Financial calendar
Financial calendar Wednesday 09/05/2018 General Meeting Kinepolis Group Thursday 23/08/2018 Half year results 2018 Press & analyst meeting Thursday 15/11/2018 Business update Q3 2018 43
Slide 44: Annexes Financial Statements
Annexes Financial Statements Results 2017
Slide 45: Consolidated income statement
Consolidated income statement €m YE 2017 YE 2016 % Better / ‐Worse Revenue 355,4 324,9 9,4% Cost of Sales ‐242,0 ‐224,7 ‐7,7% Gross profit 113,4 100,2 13,2% Gross profit % 31,9% 30,8% Marketing & selling expenses ‐20,4 ‐18,6 ‐9,7% Administrative expenses ‐22,8 ‐19,1 ‐19,6% Other operating income and
Slide 46: Consolidated balance sheet
Consolidated balance sheet €m 31/12/2017 31/12/2016 % Better / ‐Worse Intangible assets 9,0 5,9 53,4% Goodwill 86,4 53,3 62,2% Property, plant & equipment 390,0 321,5 21,3% Investment property 17,7 31,0 ‐42,8% Deferred tax assets 1,2 0,9 31,0% Other receivables 10,1 11,6 ‐12,6% Total non‐current ass
Slide 47: Consolidated balance sheet
Consolidated balance sheet €m 31/12/2017 31/12/2016 % Better / ‐Worse Capital & share premium 20,1 20,1 0,0% Consolidated reserves 157,6 130,9 20,4% Translation differences ‐1,3 ‐1,1 ‐19,6% Equity attributable to equity holders of the parents 176,4 149,9 17,7% Total equity 176,4 149,9 17,7% Interest
Slide 48: Cash flow statement
Cash flow statement €m YE 2017 YE 2016 Better / ‐Worse Profit before tax 64,7 55,6 9,1 Adjustments for: Depreciation, amortization & provisions 29,8 27,9 1,9 Government grants ‐0,9 ‐1,0 0,1 Gains / losses on sale of PPE & financial assets ‐1,8 0,1 ‐1,9 Financial result & Share based payments 8,7 6,6
Slide 49: Free cash flow
Free cash flow €m YE 2017 YE 2016 Better / ‐Worse Cash Flow before WC movements & tax paid 100,5 89,2 11,3 Income taxes paid ‐24,1 ‐26,8 2,6 Working capital 1,0 6,8 ‐5,8 Capital exp – maintenance ‐10,6 ‐8,2 ‐2,4 Interest paid ‐7,3 ‐7,4 0,1 Free cash flow 59,4 53,6 5,8 Capital Exp ‐ Digitalization &
Slide 50: Slide 50