Lagardere Sa · EURONEXT:MMB
Lagardere Sa — Lagardère SCA — Investor Presentation (April 2008)
37 slides from Lagardere Sa's investor presentation, April 2008
Slide 1: April 2008
© Frédérik Froument - J.P.Thomas/Agence FEP April, 2008
Slide 2: Warning
Warning Certain of the statements contained in this document are not historical facts but rather are statements of future expectations and other forward-looking statements that are based on management’s beliefs. These statements reflect such views and assumptions as of the date of the statements and
Slide 3: Lagardère SCA at end December 2007
Lagardère SCA at end December 2007 Global leader in Consumer Media Refocused on 4 activities: • Lagardère Publishing • Lagardère Active • Lagardère Services • Lagardère Sports 12.5% stake in EADS 10-year trend of regular profitability improvement Three growth areas: • sports rights management • digi
Slide 4: Lagardère SCA at end December 07
Lagardère SCA at end December 07 Solid set of figures: Net sales: €8,582m / + 8.5% Recurring EBIT: €636m / + 22% Net income: €534m / + 83,5% Adjusted earnings per share (fully diluted): €2.70 / - 3.2% 4
Slide 5: 2007 Full-Year Revenues and Rec EBIT breakdown
Lagardère SCA at end December 07 2007 Full-Year Revenues: 2007 Rec EBIT breakdown: €8,582m €636m Lagardère Lagardère Lagardère Lagardère Sports Publishing Sports Lagardère Publishing €440m €2,130m €67m Services €239m 11% 43% €116m 25% 18% 5% 37% 21% 12% 6% 22% Lagardère Press Broadcast & Services Br
Slide 6: International Presence
International Presence North America 11% Europe 45% France 37% Africa & Middle East 1% Asia 5% Latin America 1% Lagardère Media 2007 sales 6
Slide 7: Lagardère Publishing: Competitive Position in the World Book Market
Lagardère Publishing Competitive Position in the World Book Market P earso n 5004 Hachette Livre 2130 M cGraw Hill Educatio n 1977 Rando m Ho use 1947 Ho ughto n M ifflin 1909 Hachette Livre: No.2 Scho lastic 1737 De A go stini 1668 Tho mso n Learning 1439 2006-2007 sales(*) in € million Ho ltzbrinc
Slide 8: Publishing: 2004-2006 Transformation, Further International Expansion
Lagardère Publishing 2004-2006: the Transformation – Further International Expansion U.K. Ireland Total net sales: Hachette Partworks 37% France Orion Quebec Orion Hodder Nether- lands 63% International Headline Octopus Belgium Germany Little, Brown Poland France TWBG Larousse Austria Hatier Switzer
Slide 9: Publishing: A Balanced Portfolio of Assets
Lagardère Publishing A Balanced Portfolio of Assets France Other Education Other Distribution Partworks 13% 21% 32% 3% 20% 10% 2% 16% 10% Reference 16% 37% 21% Illustrated Literature US Spain UK Lagardère Publishing 2007 net sales (€2,130m) 9
Slide 10: What next for Lagardère Publishing?
Lagardère Publishing What next for Lagardère Publishing? Continued organic growth Further consolidation: UK, Spain (trade) & USA (trade) 10
Slide 11: Publishing: Strong, regular growth
Lagardère Publishing Strong, regular growth 239 220 189 173 164 107 91 65 68 71 52 58 53 30 38 34 11 12 -3 -3 1999 * 2000* 2001* 2002* 2003* 2004* 2004** 2005** 2006*** 2007*** IFRS Books Half Year Rec EBITA Books Full Year Rec EBITA * 1999-2004 French GAAP ** 2004-2005 IFRS: Recurring EBIT Before A
Slide 12: Lagardère Services (2007 sales: €3,721m)
Lagardère Services (2007 sales: €3,721m) 63% of sales outside France Poland: 4% Belgium: 14% France: 37% Hungary: 9% Spain: 14% Australia / North America: 6% Singapore / China: 4% Other Europe: 54% Switzerland: 9% Source: LS Finance 2007 figures 12
Slide 13: Services: Combination of organic growth and acquisitions
Lagardère Services Combination of organic growth & acquisitions Lagardère Services average annual sales growth (CAGR) of approx 5.1 % from 2000 to 2007 45% of this growth has been via acquisitions (Virgin, Saresco, Czech Republic, Newslink, Hong Kong) Organic growth & acquisitions 2000 / 2007 (€bn)
Slide 14: Services: Continuing shift from distribution to retail
Lagardère Services Continuing shift from distribution to retail Net sales breakdown CAGR Distribution Travel Retail +5.1% €3.7bn Retail of Media & Ent. Products +1.2% €2.6bn 32% 42% 42% +6.7% 38% +9.0% 26% 20% 2000 2007 Source: LS Finance 2000 figures restated for comparability with 2007 14
Slide 15: Services: Continuing shift towards higher margin products
Lagardère Services Continuing shift towards higher margin products Product mix Phone cards 11% Food/beverages 7% Liquor, perfumes & cosmetics 4% 20% Other 9% 31% 0% 11% 4% Other 17% 12% Music & video Books 15% Tobacco Press 52% 38% 2000 2007 Source: LS Finance 15 2000 figures restated for comparabil
Slide 16: Services: Continuing shift towards Central Europe and Asia Pacific
Lagardère Services CAGR Region 2004/07 Continuing shift Mature countries -1% towards Central Central Europe 17% Europe and Asia Asia Pacific 37% Pacific 3,5 0,1 3,7 All of Lagardère Services’ 0,2 -0,1 growth is generated by 2004 sales Growth in Growth in Growth in 2007 sales non mature countries Mat
Slide 17: Services: Regular growth
Lagardère Services Regular growth 116 106 109 98 101 88 92 81 61 48 45 40 41 40 42 33 35 31 21 22 1999* 2000 * 2001* 2002* 2003* 2004 * 2004** 2005 ** 2006***2007 *** IFRS Distribution Half Year Rec EBITA Distribution Full Year Rec EBITA * 1999-2004 French GAAP ** 2004-2005 IFRS: Recurring EBIT Befo
Slide 18: Lagardère Active: A newly merged entity
Lagardère Active: A newly merged entity (2007 sales: €2,291m) 18
Slide 19: Active: Audiovisual – A leading player in radio in France
Active: Audiovisual – Total Radio Sales: €298m A leading player in radio in France… 3 radio stations No.1 radio advertising sales house Europe 1, Virgin Radio, RFM gathering close to 20% audience share Market share Cumulative daily reach Other 9.9% Lagardere 12,9 Publicité 11,5 32.5% 9,9 9,6 9 NRJ G
Slide 20: Active: Radio abroad – 23 radio stations
Active: Audiovisual – Total Radio Sales: €298m … and abroad (23 radio stations) – 42% of Radio Sales Russia Poland Gross ad revenue share Gross ad revenue share 2007 Lagardere 2007 Other Active State-owned 24% 25% stations LARI 9% 27% Gazprom RMG Time/ Eska 8% 15% 24% State PN * Profmedia 4% owned s
Slide 21: Active: Audiovisual – A leader in TV production
Active: Audiovisual – Total TV Sales: €210m A leader in TV production TV Production TV Channels No.1 TV group in scripted production Successful launch of 3 DTT channels: Lagardère Active 102 3.5% viewing time * Prime time Carrère 79 1.5% broadcast hours pay-TV offer Telfrance 72 2006-2007 Leader in
Slide 22: Active: Audiovisual – Catching up
Active: Audiovisual Catching up 77 77 49 47 41 44 36 37 34 27 30 12 14 15 9 5 4 -4 -4 -9 1999* 2000* 2001* 2002* 2003* 2004 * 2004** 2005 ** 2006***2007 *** IFRS Audiovisual Half Year Rec EBITA Audiovisual Full Year Rec EBITA * 1999-2004 French GAAP ** 2004-2005 IFRS: Recurring EBIT Before Associate
Slide 23: Active: Press – An international network in 41 countries
Active: Press (excluding regional dailies) An international network in 41 countries WESTERN EUROPE EASTERN 24% EUROPE 11% NORTH AMERICA 21% ASIA & OTHERS 8% Controlled subsidiaries Joint venture License 36% Brand extension dynamic 23 39 editions
Slide 24: Active: Press – Leading Special Interest Magazine Publisher
Active: Press (2007 sales: €1,782m) Leading Special Interest Magazine Publisher Worldwide Women, cars, home & interiors, celebs, TV, etc 260 magazines 24 over 1 billion copies each year
Slide 25: Active: Press – Turning around
Active: Press Turning around Investment Advertising downturn in new launches Turnaround 213 203 186 192 201 196 168 161 137 115 92 93 89 92 83 75 72 68 55 62 1999* 2000* 2001* 2002* 2003* 2004* 2004** 2005** 2006***2007*** IFRS Press Half Year Rec EBITA Press Full Year Rec EBITA * 1999-2004 French G
Slide 26: Active 2007-2010: Rationalizing portfolio and improving profitability
Active: 2007-2010: transforming steps Rationalizing the portfolio & Improving profitability Recurring €m Net sales EBIT Title portfolio -90 +7 Country portfolio -40 +1 Transformation 0 +70 costs Total savings -130 +78 Non-strategic -260 +4 assets 26
Slide 27: Active: Rationalize the portfolio of titles and territories
Active: 2007-2010: transforming steps Rationalize the portfolio of titles and territories (Magazines and TV Production): the Achievements 1. Sale of non-strategic assets Regional Daily Press Photo Agencies Done Production houses: Films d’Ici and 13 Productions 2. Closure of titles 12 titles since No
Slide 28: Active: Improve profitability 1/2
Active: 2007-2010: transforming steps Improve profitability 1/2 Achieve annual cost savings of €70m: we will hit or beat our target 1. Renegotiation of paper procurement Consolidation of paper needs, worldwide tendering, + €10m p.a. Done optimization of specifications (paper stock, weight, size) 2.
Slide 29: Active: Improve profitability 2/2
Active: 2007-2010: transforming steps Improve profitability 2/2 4. Headcount reductions Around 10% of French headcount Completion early 2008 Progress on schedule in international operations Completion in 2008 5. Cost-saving plan in TV Production/Music/Kids Completion in 2008 6. Rollout of internatio
Slide 30: Active: Digital Strategy
Active: 2007-2010: transforming steps Digital Strategy Growing digital sales and profits: Organically: from 1% of Lagardere Active sales in 2006 to 5% by 2009 Digital sales at end December 07: 3.1% Lagardère Active sales Via acquisitions (depending on opportunities and prices): a potential extra 5%
Slide 31: Lagardère Sports (2007 sales: €440m)
Lagardère Sports (2007 sales: €440m) A New Division: Sport5 + NewsWeb + IEC 31
Slide 32: Sports: A key player in the sports rights value chain
Lagardère Sports A key player in the sports rights value chain Sportfive is a sports rights agent Acts as agent between rights holders and buyers These rights are either acquired, or obtained through multi-year agency agreements Sportfive value chain Original rights holders Rights Rights Agent Right
Slide 33: Sports: 3 axes of expansion
Lagardère Sports: 3 axes of expansion November 2006 December 2007 TV Rights Trading Media: Media Production New Media Platform Web services Sponsorship TV Rights Trading Marketing: Hospitality, Stadium Management Events ownership Sponsorship CRM (Customer Relationship Management) Activity Activity C
Slide 34: Sports: European leader in sports rights management
Lagardère Sports European leader in sports rights management in € million 2007 Revenues 440 Operating Margin %15.2 Other 11% Germany Asia 24% 7% UK Other 15% European countries 33% France 10% 34
Slide 35: Sports: Growing and profitable
Lagardère Sports Growing & profitable 100 80 + 17.5% 67 57 60 40 29 20 0 2005 2006* 2007** Half Year Full Year *Not consolidated in 2006 (excluding IEC) ** 2007 IFRS Rec EBITA before associates 35
Slide 36: Lagardère: Outlook for 2008
LAGARDERE: Outlook for 2008 Recurring EBIT before associates expected to grow in 2008 from «3% to 7%» versus 2007 level Assumptions: $1.50 = €1 36
Slide 37: Lagardère IR Team
Lagardère IR Team: Laurent Carozzi Investor Relations Director Tel: 33 1 40 69 18 02 lcarozzi@lagardere.fr Béatrice de Clermont Tonnerre Investor Relations Tel: 33 1 40 69 16 60 bct@lagardere.fr Hélène Martin Assistant Tel: 33 1 40 69 19 22 Fax: 33 1 40 69 22 72 hmartin@lagardere.fr Address: 4 rue d