Lagardere SA · EURONEXT:MMB
Lagardere SA — Lagardère SCA — Investor Presentation (January 2021)
68 slides from Lagardere SA's investor presentation, January 2021
Slide 1: Investor Presentation January 2021
INVESTOR PRESENTATION January 2021
Slide 2: Disclaimer
Investor presentation / January 2021 DISCLAIMER By reading this presentation, you further agree to be bound by the following limitations and qualifications: This presentation is for information purposes only and does not constitute an offer or solicitation for the sale or purchase of any securities,
Slide 3: Table of Contents
Investor presentation / January 2021 TABLE OF CONTENTS OVERVIEW & RECENT HIGHLIGHTS slide 4 Q3 PERFORMANCE BY DIVISION slide 11 H1 2020 PERFORMANCE BY DIVISION slide 17 GROUP PROFILE slide 29 CSR POLICY slide 39 Appendix 1: H1 2020 results slide 45 Appendix 2: impacts of IFRS 16 on the consolidated
Slide 4: Overview & Recent Highlights
Investor presentation / January 2021 OVERVIEW & RECENT HIGHLIGHTS
Slide 5: A Focused Group with Two Core Businesses
Investor presentation / January 2021 A FOCUSED GROUP WITH TWO CORE BUSINESSES FY 2019: €2.4bn H1 2020: €971m FY 2019: €4.3bn H1 2020: €947m Revenue 33% of total revenue 47% of total revenue 59% of total revenue 45% of total revenue Recurring FY 2019: €220m H1 2020: €27m FY 2019: €152m H1 2020: -€209
Slide 6: Group Profile – H1 2020
Investor presentation / January 2021 GROUP PROFILE – H1 2020 H1 2020 revenue by division H1 2020 recurring EBIT by division H1 2020 revenue by geographic area Non-retained scope**** 27 US & France Other Activities*** 3% Canada 26% 27% 29%* 5% (1) 25%* (35) Lagardère Lagardère €2,088m €3,324m** Trave
Slide 7: Q3 2020 Revenue: In Line with H1 2020 Trend
Investor presentation / January 2021 Q3 2020 REVENUE: IN LINE WITH H1 2020 TREND Lagardère Q3 2020 revenue Like-for-like steady vs. H1 2020 €m 2019 Scope FX performance* 2020 thanks to business mix Lagardère Publishing: sales 9 months 5,249 +0.2% -0.2% -38.0% 3,276 -37.6% rebound continued over the
Slide 8: Covid Impact on Travel Retail Mitigated by Growth in Publishing Revenue in Q3 2020
Investor presentation / January 2021 COVID IMPACT ON TRAVEL RETAIL MITIGATED BY GROWTH IN PUBLISHING REVENUE IN Q3 2020 Like-for-like Scope Currency performance €1,925m (+1.0%) (-1.0%) (-38.3%) +€17m -€21m €1,188m Travel Retail -66% +76 -€733m Publishing +6% Q3 2019 Q3 2020 Publishing Travel Retail
Slide 9: Maturity Profile Overview
Investor presentation / January 2021 MATURITY PROFILE OVERVIEW ▪ As of 30 September 2020, strong liquidity with nearly €1.4bn available ▪ €465m State-guaranteed loan and RCF extension & amendment announced on 4th January 2021 As of 30/06/20, except available cash as of 30/09/20 Bonds ▪ In addition t
Slide 10: Liquidity and Outlook
Investor presentation / January 2021 LIQUIDITY AND OUTLOOK ▪ Robust liquidity of €1,387m as of 30 September 2020 ▪ Agreements with banks on extended RCF and amended covenants in December 2020 ▪ €465m State-guaranteed loan (‘PGE’) signed in December 2020, with early January 2021 closing ▪ Lagardère P
Slide 11: Q3 2020 Performance by Division
Investor presentation / January 2021 Q3 2020 PERFORMANCE BY DIVISION
Slide 12: Lagardère Publishing
Investor presentation / January 2021 LAGARDÈRE PUBLISHING Solid performance confirming the market rebound and the Like-for-like strength of Lagardère Publishing €m 2019 Scope FX performance* 2020 book releases 9 months 1,707 +1.1% -0.2% -2.8% 1,675 -1.9% ▪ General Literature and Illustrated Books se
Slide 13: Publishing Keeping Up Positive Trend After Sharp Rebound in June 2020
Investor presentation / January 2021 PUBLISHING KEEPING UP POSITIVE TREND AFTER SHARP REBOUND IN JUNE 2020 Lagardère Publishing revenue (vs. 2019) ▪ Benefiting from diversified channel and +21% format mix +10% ▪ General Literature best sellers: success of +6% +4% Midnight Sun (Stephenie Meyer) in se
Slide 14: Lagardère Travel Retail
Investor presentation / January 2021 LAGARDÈRE TRAVEL RETAIL Business affected by Covid-19 second wave after modest Like-for-like recovery post-lockdown €m 2019 Scope FX performance* 2020 ▪ Europe: mainly regional leisure 9 months 3,147 +1.6% -0.3% -58.8% 1,340 -57.4% travel ▪ North America: mainly
Slide 15: Travel Retail Trend in Line with Moderate Passenger Mobility
Investor presentation / January 2021 TRAVEL RETAIL TREND IN LINE WITH MODERATE PASSENGER MOBILITY Lagardère Travel Retail revenue (vs. 2019) +1% Diversified distribution channels and business segments drove Q3 2020 performance ▪ International travel strongly affected by restrictive government travel
Slide 16: Other Activities
Investor presentation / January 2021 OTHER ACTIVITIES** Revenue from Radio, Press, Like-for-like Licensing and Entertainment in €m 2019 Scope FX performance* 2020 performance venues impacted by lockdown in France and by announcer decisions to reduce 9 months 208 -0.5% - -21.1% 164 -21.5% their adver
Slide 17: H1 2020 Performance by Division
Investor presentation / January 2021 H1 2020 PERFORMANCE BY DIVISION
Slide 18: H1 2020 Highlights
Investor presentation / January 2021 H1 2020 HIGHLIGHTS (€m) H1 2019 H1 2020 Revenue* 3,324 2,088 Group recurring EBIT*/** 88 (218) Profit (loss) – Group share [including net income/(loss) from Lagardère Sports] 52 (481) Adjusted profit (loss) – Group share*/** 6 (278) Free cash flow*/** (34) (511)
Slide 19: Lagardère Publishing: Activity
Investor presentation / January 2021 LAGARDÈRE PUBLISHING: ACTIVITY H1 2020 revenue by geographic area H1 2020 revenue by activity Education UK & 11% France 11%* Australia*** 25% 20% 28%* Illustrated 17%* Books 11% Spain 12%* 5% 5%* €971m General €971m Literature €1,044m** €1,044m** 49% Partworks 45
Slide 20: Lagardère Publishing: Profitability
Investor presentation / January 2021 LAGARDÈRE PUBLISHING: PROFITABILITY Change in recurring EBIT (€m) Flow through* and operating margin (%) (change in recurring EBIT/change in revenue) 13.7% -€73m H1 2019 H1 2020 -13% 184 1,044 971 -€9m 3.5% 2.8% 36 36 27 27 H1 2019 H2 2019 H1 2020 Revenue Recurri
Slide 21: Lagardère Publishing: Cash Flow Statement
Investor presentation / January 2021 LAGARDÈRE PUBLISHING: CASH FLOW STATEMENT (€m) H1 2019 H1 2020 Cash flow from operations before changes in working capital 37 33 Changes in working capital (100) (114) Income taxes paid (19) (22) Cash flow used in operations (82) (103) Purchases/disposals of PP&E
Slide 22: Lagardère Travel Retail: Activity
Investor presentation / January 2021 LAGARDÈRE TRAVEL RETAIL: ACTIVITY H1 2020 revenue by geographic area H1 2020 revenue by activity US & Canada Asia-Pacific 26% 12% 26%* 12%* Travel Duty Free Essentials & Fashion €947m 42% €947m 36% EMEA France 40%* €1,995m** 38%* €1,995m** (excluding 20% 23%* Fra
Slide 23: Lagardère Travel Retail: Profitability
Investor presentation / January 2021 LAGARDÈRE TRAVEL RETAIL: PROFITABILITY Change in recurring EBIT (€m) Flow through* and operating margin (%) (change in recurring EBIT/change in revenue) 4.7% -24% 2.3% 107 -22.1% +574 46 46 +219 (209) (209) (1,048) H1 2019 Change Variable-cost Fixed-cost H1 2020
Slide 24: Lagardère Travel Retail: Cash Flow Statement
Investor presentation / January 2021 LAGARDÈRE TRAVEL RETAIL: CASH FLOW STATEMENT (€m) H1 2019 H1 2020 Cash flow from operations before changes in working capital 102 (136) Changes in working capital (7) (201) Income taxes paid (7) (2) Cash flow from (used in) operations 88 (339) Purchases/disposals
Slide 25: Other Activities
Investor presentation / January 2021 OTHER ACTIVITIES H1 2020 revenue by activity Change in recurring EBIT (€m) 0 Radio -11 38% 36%* €107m Press -35 46% €145m** 41%* H1 2019 H2 2019 H1 2020 Other 16% 23%* €107m (down 26.2% on a consolidated basis and down 26.1% like-for-like). ▪ €1m negative scope e
Slide 26: Like-for-Like Revenue Growth by Segment
Investor presentation / January 2021 LIKE-FOR-LIKE REVENUE GROWTH BY SEGMENT Lagardère Publishing Lagardère Travel Retail Other Activities* +21% +6% +1% +1% -19% -22% -19% -39% -36% -42% Jan.- March April May June -54% -51% Feb. Jan.- March April May June Feb. -8.3% -82% -87% -91% -26.1% Jan.- March
Slide 27: Vigorous Corrective Measures Implemented to Limit the Impact of Covid-19
Investor presentation / January 2021 VIGOROUS CORRECTIVE MEASURES IMPLEMENTED TO LIMIT THE IMPACT OF COVID-19 ▪ Protecting employees, customers and partners. ▪ Creating and activating a Covid-19 solidarity fund with an endowment of (i) €5m out of the cash initially allocated to the dividend payment,
Slide 28: Consolidated Statement of Cash Flows
Investor presentation / January 2021 CONSOLIDATED STATEMENT OF CASH FLOWS (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) H1 2019 H1 2020 Cash flow from (used in) operations before changes in working capital 139 (138) Changes in working capital
Slide 29: Group Profile
Investor presentation / January 2021 GROUP PROFILE
Slide 30: Worldwide Presence
Investor presentation / January 2021 WORLDWIDE PRESENCE 30
Slide 31: A Global Leader in Publishing
Investor presentation / January 2021 A GLOBAL LEADER IN PUBLISHING ▪ Activities • One of the world’s oldest publishing groups with deep expertise in acquiring and integrating publishing houses, now the number three publisher worldwide*. • A diversified, international publisher offering readers the v
Slide 32: Lagardère Publishing: The World #3 Private-Sector Consumer Book Publisher
Investor presentation / January 2021 LAGARDÈRE PUBLISHING: THE WORLD #3 PRIVATE-SECTOR CONSUMER BOOK PUBLISHER Top 3 Consumer Publishing players worldwide Top rankings in core markets across main businesses Based on 2019 revenue (€bn) Trade Education 1 3 1 3 3.6 3.5 3 2 4 2 2.4 Distribution Partwork
Slide 33: Lagardère Publishing: 2019 Key Facts
Investor presentation / January 2021 LAGARDÈRE PUBLISHING: 2019 KEY FACTS Top 20 sales of cultural goods 33
Slide 34: Creating New Opportunities out of Emerging Consumer Behaviors and New Forms of Reading
Investor presentation / January 2021 CREATING NEW OPPORTUNITIES OUT OF EMERGING CONSUMER BEHAVIORS AND NEW FORMS OF READING E-books E-books contribution to Lagardère Publishing's overall revenue: 7.7% in FY 2019 / 10.6% in H1 2020 (vs. 8.2% in H1 2019). Audiobooks Audiobooks contribution to Lagardèr
Slide 35: A Global Leader in Travel Retail
Investor presentation / January 2021 A GLOBAL LEADER IN TRAVEL RETAIL ▪ Activities • Retail operations in travel hubs on three segments: - Travel Essentials; - Duty Free & Fashion; - Foodservice. • These activities are located in three geographic areas: Europe, Middle East and Africa (EMEA), Asia-Pa
Slide 36: Lagardère Travel Retail: A Leading Global Travel Retail Operator
Investor presentation / January 2021 LAGARDÈRE TRAVEL RETAIL: A LEADING GLOBAL TRAVEL RETAIL OPERATOR 2 1 4 4 1 Travel Retail in Travel in Airport in in Fashion 39 in airports Essentials Duty Free* Foodservice** 750 countries railway & metro stations 4,850 270 airports stores 530m 80% clients of sal
Slide 37: Partner of Choice
Investor presentation / January 2021 PARTNER OF CHOICE ▪ Diverse portfolio in Travel Retail TRAVEL ESSENTIALS DUTY FREE & FASHION FOODSERVICE Own brands Partner brands Bespoke brands 37
Slide 38: Key Features and Ratios of Tender Offers in the Airport Travel Retail Environment
Investor presentation / January 2021 KEY FEATURES AND RATIOS OF TENDER OFFERS IN THE AIRPORT TRAVEL RETAIL ENVIRONMENT (2019) ✓ Contracts are awarded through tender offer processes where travel retail operators answer RFPs on “packages” depending on the retail space location and / or the product lin
Slide 39: CSR Policy
Investor presentation / January 2021 CSR POLICY
Slide 40: The Strategic Pillars of Our CSR Policy
Investor presentation / January 2021 THE 3 STRATEGIC PILLARS OF OUR CSR POLICY Limit the Place the human environmental Share our social at the heart of our footprint of our and cultural strategy products and diversity services 40
Slide 41: Sustainable Development / CSR
Investor presentation / January 2021 SUSTAINABLE DEVELOPMENT / CSR By making workforce-related, environmental and ethical issues a central part of its strategy, the Lagardère group intends to support the company’s value-creation efforts along with its sustainable and inclusive growth. Its commitment
Slide 42: Place the Human at the Heart of Our Strategy: Gender Equality
Investor presentation / January 2021 PLACE THE HUMAN AT THE HEART OF OUR STRATEGY: GENDER EQUALITY, A YEAR OF PROGRESS Share of women at Group's executive management positions Increasing number of women in senior management positions 42% 44% 2018 2019 89/100 86/100 Publication of the Gender Equal Pa
Slide 43: Limit the Environmental Footprint of Our Products and Services
Investor presentation / January 2021 LIMIT THE ENVIRONMENTAL FOOTPRINT OF OUR PRODUCTS AND SERVICES Fight against climate change: optimising our energy consumption, carrying out carbon footprint assessments Ensure responsible paper life cycle management: supply, production, unsold goods management E
Slide 44: Share Our Social and Cultural Diversity
Investor presentation / January 2021 SHARE OUR SOCIAL AND CULTURAL DIVERSITY Enhance access to education and knowledge and promote cultural diversity Defend freedom of expression, pluralism of ideas and accessibility of content Raise awareness on social issues and sustainable development 44
Slide 45: Appendix 1: H1 2020 Results
Investor presentation / January 2021 APPENDIX 1: H1 2020 RESULTS
Slide 46: Summary of Performance by Division – H1 2020
Investor presentation / January 2021 SUMMARY OF PERFORMANCE BY DIVISION – H1 2020 (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) ▪ Revenue H1 2020 Consolidated Consolidated Like-for-like (€m) change change change* Lagardère Publishing 971 -€73m -7.0
Slide 47: Changes in Revenue
Investor presentation / January 2021 CHANGES IN REVENUE (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) -87 +3 3,324 -1,088 -37 -27 2,088 H1 2019 Lagardère Lagardère Other Activities Non-retained FX and scope H1 2020 revenue Publishing Travel Re
Slide 48: Group Recurring EBIT to EBIT
Investor presentation / January 2021 GROUP RECURRING EBIT TO EBIT (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) H1 2019 H1 2020 88 98 37 29 0 (25) (8) (12) (8) (6) (63) (42) (56) (94) (218) (476) IFRS 16 Group Income from Restructuring Gains (
Slide 49: EBIT to Profit (Loss) – Group Share
Investor presentation / January 2021 EBIT TO PROFIT (LOSS) – GROUP SHARE (€m) H1 2019 H1 2020 98 65 51 17 52 (41) (38) (24) (41) (12) (8) (20) (476) (481) Interest Net income/(loss) Profit (loss) EBIT expense on Finance costs, Income tax from discontinued attributable Profit (loss) – Group lease net
Slide 50: Group Recurring EBIT to Adjusted Profit (Loss) – Group Share
Investor presentation / January 2021 GROUP RECURRING EBIT TO ADJUSTED PROFIT (LOSS) – GROUP SHARE (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) H1 2019 H1 2020 88 0 8 8 6 (25) (9) (10) (25) (41) (24) (24) (218) (278) Income tax Group Income fr
Slide 51: Consolidated Income Statement
Investor presentation / January 2021 CONSOLIDATED INCOME STATEMENT (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) H1 2019 H1 2020 Revenue 3,324 2,088 Group recurring EBIT* 88 (218) Income (loss) from equity-accounted companies** - (25) Non-recu
Slide 52: Consolidated Statement of Cash Flows
Investor presentation / January 2021 CONSOLIDATED STATEMENT OF CASH FLOWS (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) H1 2019 H1 2020 Cash flow from (used in) operations before changes in working capital 139 (138) Changes in working capital
Slide 53: Free Cash Flow Reconciliation
Investor presentation / January 2021 FREE CASH FLOW RECONCILIATION (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) H1 2019 H1 2020 Cash flow from operating activities before changes in working capital 422 28 Repayment of lease liabilities (225)
Slide 54: Target Scope Free Cash Flow
Investor presentation / January 2021 TARGET SCOPE FREE CASH FLOW (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) (€m) H1 2019 H1 2020 Cash flow from (used in) operations before changes in working capital* 142 (136) Income taxes paid (11) (14) Purchas
Slide 55: Analysis of Non-Recurring/Non-Operating Items in H1 2020
Investor presentation / January 2021 ANALYSIS OF NON-RECURRING/NON-OPERATING ITEMS IN H1 2020 (EXCLUDING LAGARDÈRE SPORTS, CLASSIFIED WITHIN DISCONTINUED OPERATIONS IN ACCORDANCE WITH IFRS 5) Non-retained scope Lagardère Lagardère Other Total target Total Total (former Lagardère (€m) Publishing Trav
Slide 56: Adjusted Profit – Group Share
Investor presentation / January 2021 ADJUSTED PROFIT – GROUP SHARE (€m) H1 2019 H1 2020 Profit (loss) for the period 72 (498) Restructuring costs +8 +12 Gains/losses on disposals -37 +8 Impairment losses on goodwill, PP&E, intangible assets and investments +6 +63 in equity-accounted companies Amorti
Slide 57: Consolidated Balance Sheet
Investor presentation / January 2021 CONSOLIDATED BALANCE SHEET (€m) Assets* Equity and liabilities 31 Dec. 2019 30 June 2020 31 Dec. 2019 30 June 2020 1,672 Intangible assets 2,699 1,461 1,099 Total equity 2,607 2,859 2,048 Net debt** Right-of-use assets 3,097 2,157 Other assets 1,295 2,538 Lease l
Slide 58: Changes in Scope: Main Items
Investor presentation / January 2021 CHANGES IN SCOPE: MAIN ITEMS ▪ Lagardère Publishing • Acquisition in December 2019 of Blackrock Games, a French board game distributor. • Acquisition in January 2020 of Le Livre Scolaire, a French textbook publisher. ▪ Non-retained scope • Lagardère Sports - Disp
Slide 59: Consolidated Balance Sheet
Investor presentation / January 2021 CONSOLIDATED BALANCE SHEET (€m) 31 Dec. 2019 30 June 2020 Non-current assets 6,733 6,033 Investments in equity-accounted companies 73 56 Current assets 2,416 2,193 Short-term investments and cash 913 1,021 Assets held for sale 994 217 TOTAL ASSETS 11,129 9,520 To
Slide 60: Appendix 2: Impacts of IFRS 16 on the Consolidated Accounts
Investor presentation / January 2021 APPENDIX 2: IMPACTS OF IFRS 16 ON THE CONSOLIDATED ACCOUNTS
Slide 61: Impact of IFRS 16 on the Consolidated Income Statement and Related Indicators
Investor presentation / January 2021 IMPACT OF IFRS 16 ON THE CONSOLIDATED INCOME STATEMENT AND RELATED INDICATORS (€m) H1 2019 FY 2019 H1 2020 Recurring EBITDA* -1 - -1 Group recurring EBIT* +8 +13 +6 Income from equity-accounted companies** - - - Non-recurring/non-operating items +29 +60 -94 Of wh
Slide 62: Impact of IFRS 16 on the Consolidated Statement of Cash Flows
Investor presentation / January 2021 IMPACT OF IFRS 16 ON THE CONSOLIDATED STATEMENT OF CASH FLOWS (€m) H1 2019 FY 2019 H1 2020 Cash flow from operating activities before changes in working capital +289 +616 +172 Repayment of lease liabilities -225 -519 -109 Interest paid on lease liabilities -40 -7
Slide 63: Impact of IFRS 16 on the Consolidated Balance Sheet
Investor presentation / January 2021 IMPACT OF IFRS 16 ON THE CONSOLIDATED BALANCE SHEET (€m) 31 Dec. 2019 30 June 2020 (€m) 31 Dec. 2019 30 June 2020 Total equity -134 -228 Non-current assets +2,934 +2,259 Non-current liabilities +2,535 +2,093 Right-of-use asset +2,859 +2,157 Lease liability – non-
Slide 64: Glossary
Investor presentation / January 2021 GLOSSARY
Slide 65: Glossary (1/3)
Investor presentation / January 2021 GLOSSARY (1/3) Lagardère uses alternative performance measures which serve as key indicators of the Group's operating and financial performance. These indicators are tracked by the Executive Committee in order to assess performance and manage the business, as wel
Slide 66: Glossary (2/3)
Investor presentation / January 2021 GLOSSARY (2/3) ▪ Flow through is calculated by dividing the change in recurring operating profit of fully-consolidated companies (recurring EBIT) by the change in revenue. This indicator is used by the Group in the context of the Covid-19 pandemic to measure the
Slide 67: Glossary (3/3)
Investor presentation / January 2021 GLOSSARY (3/3) ▪ Adjusted profit – Group share is calculated on the basis of profit for the period, excluding non-recurring/non-operating items, net of the related tax and of minority interests, as follows: Profit for the period excluding: • Gains (losses) on dis
Slide 68: Lagardère IR Team
Investor presentation / January 2021 LAGARDÈRE IR TEAM IR team details Emmanuel Rapin Head of Financing and Investor Relations Tel: +33 1 40 69 17 45 erapin@lagardere.fr Alima Lelarge Levy Investor Relations Senior Manager Tel: +33 1 40 69 19 22 alelargelevy@lagardere.fr Address: 4-10, Avenue André