Lagardere Sa · EURONEXT:MMB
Lagardere Sa — Lagardère SCA — Investor Day (January 2011)
63 slides from Lagardere Sa's investor day presentation, Jan 25, 2011
Slide 1: Investor Day
Investor Day 25th of January 2011 0
Slide 2: Disclaimer
Disclaimer Certain of the statements contained in this document are not including without limitation: historical facts but rather are statements of future expectations and other forward-looking statements that are based on management’s General economic and labour conditions, including in particular
Slide 3: Today's speakers
Today’s speakers OLIVIER GUIGUET KEVIN O’CONNOR COO COO LAGARDÈRE UNLIMITED Inc Olivier Guiguet was appointed Deputy Chief With more than 20 years of sports industry Operating Officer of Lagardère Unlimited by experience, Kevin O’Connor comes to Lagardère Arnaud Lagardère in 2010. Unlimited from Sad
Slide 4: Today's speakers
Today’s speakers SEAMUS O’BRIEN LAURENT CAROZZI Founder, Chairman & CEO World Sport Chief Financial Officer of Lagardère Unlimited Group Mr. Carozzi has served as Group Financial Seamus O’Brien is founder, Chairman and CEO Controller since 2008, after joining the Lagardère of World Sport Group (WSG)
Slide 5: Lagardère Unlimited is the 4th division of Lagardère SCA
Introduction: Lagardère Unlimited is the 4th division of Lagardère SCA Lagardère SCA Average 2008-2009 Sales Lagardère SCA Average 2008-2009 EBIT media 18% 43% 6% 10% 28% 27% 24% 44% 4
Slide 6: Introduction: today's agenda
Introduction: today’s agenda Analyzing investment rationale in the Sports & Entertainment business and future trends Global sports expenditure are growing faster than GDP in most geographies 45 B€ Sports market has been growing at an average 6% p.a. over the past 5 years Sports market is estimated t
Slide 7: Introduction: clients testimonials
Introduction: clients testimonials Ted Ward Vincent Chupin Vice President Vice President, Television of Marketing Geico Dianne E. Hayes - and Audiovisual Rights Head of Global Sports International Olympic Marketing - Reebok Committee Television and International Ltd. Marketing Services Jean-Michel A
Slide 8: Investor day presentation agenda
Investor day presentation agenda Why be active in the sports business? What is Lagardère Unlimited About? Lagardère Unlimited recent performance Lagardère Unlimited vision 2015 Lagardère Unlimited 2011-2012 outlook Questions and answers session ACADEMIES REPRESENTATION EVENTS MARKETING MEDIA CONSULT
Slide 9: Why be active in the sports business?
Investor day presentation agenda 1 Why be active in the sports business? 1 I Why be active in the sports business? 2 I What is Lagardère Unlimited About? 3 I Lagardère Unlimited recent performance 4 I Lagardère Unlimited vision 2015 5 I Lagardère Unlimited 2011-2012 outlook 6 I Questions and answers
Slide 10: Engines of growth of media industry
Engines of growth of media industry 1970 1980 1990 2000 2010 2020 SPORT & ENTERTAINMENT DIGITAL WEB TV RADIO PRESS 9
Slide 11: Global Sports market accounts for ~1% of the overall GDP
Global Sports market accounts for ~1% of the overall GDP Sports industry market build up All revenues generated - In B€, 2009 - by sport industry Sports infrastructure construction Sports practice 350-450 B€ Sporting goods and licensed products Sports entertainment events ~45 B€ ~13 B€ All revenues
Slide 12: Global Sports market is outperforming GDP in most geographies
Global Sports market is outperforming GDP in most geographies Sports expenditure growth vs. GDP growth ratio by region - Based on 2000-2009 growth on illustrative countries - x 3,8 x 3,5 x 3,5 X 8,2 X 1,9 Europe, North Middle east America and Africa x 2,1 x 1,6 Asia Latin America x 3,0 Pacific x 3,0
Slide 13: Football is by far the largest global sport in value
Football is by far the largest global sport in value Sports market by sport - in B€, 2009 - 45,4 19,5 5,8 5,5 3,0 3,6 2,7 2,0 1,9 1,4 Football US Football Baseball Formula 1 Basketball Hockey Tennis Golf Other 43% 13% 12% 7% 6% 4% 4% 3% 8% 100% Sources: A.T. Kearney analysis SPORTS BUSINESS ? I WHAT
Slide 14: Sports market is split between North America and the rest of the world
Sports market is split between North America dominated by US sports and the rest of the world dominated by Football Sports market by region and sport - in B€, 2009 - Other Golf Tennis Formula1 US sports(1) Football 43% 13% 4% 40% (1) NFL (US Football), MLB (Baseball, NBA (Basketball) NHL (Hockey), N
Slide 15: US Sports market is ~40% of the Sports market
US Sports market is ~40% of the Sports market and offers business potential in marketing US share in total and addressable Sports market US Sports intermediation addressable market - in B€ - - in B€ - Sports market Addressable Market (1) US Sports Marketing 45,4 13,2 Centralization level Media Leagu
Slide 16: Lagardère Unlimited entered the US market through Talent Management
Lagardère Unlimited entered the US market through Talent Management Focus on Talent Management in the US 15 athletes out of the Top 30 worldwide are from the US - in % total and % revenues - 50% 57% Lagardère Unlimited has strong assets on US Talent business Joel Segal (NFL) and Dan Fegan (NBA), Lag
Slide 17: Media and Marketing revenues account for ~70% of the Sports market
Media and Marketing revenues account for ~70% of the Sports market 3,0 B€ 1,9 B€ 1,4 B€ Total : 45,4 B€ 19,5 B€ 17,8 B€ 1,8 B€ Sports market by business and sport 11% - in B€, 2009 - 20% 35% 32% 35% 16,0 B€ 42% 40% Media Marketing 21% 36% 16,1 B€ 27% 38% 76%(3) 40% 58% Ticketing Other (1) 25% 30% 26
Slide 18: Sports market has been growing at an average 6% per annum
Sports market has been growing at an average 6% per annum over the past 5 years Major sports growth rate and market size by geography - 2005 – 2009 - Weighted average CAGR Sources: A.T. Kearney analysis SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I 2011
Slide 19: Although cyclical, Sports market sustains a long term growth
Although cyclical, Sports market sustains a long term growth Global sports and addressable markets evolution - in B€, 2005-2009 - Sports market Intermediation addressable market Calendar effects are amplified on the intermediation addressable market % CAGR (1) Of which Olympic games, UEFA Euro, FIFA
Slide 20: Media rights are more cyclical than the marketing business
Within addressable market, media rights are by far more cyclical than the marketing business Total Sports and addressable markets evolution - in B€, 2005-2009 - Media Marketing % CAGR (1) Of which Olympic games, UEFA Euro, FIFA World Cup final phases and qualifiers Sources: Federations and leagues a
Slide 21: Sports market will continue to grow in the next cycle
Sports market will continue to grow in the next cycle Sports market by sport - In B€, from 2005 to 2015 - Football remains a strong engine of 2009 – 2015 growth % CAGR Sources: A.T Kearney analysis SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I 2011-2012
Slide 22: Key highlights
Key highlights Sports expenditure growth has continuously outperformed GDP Football is by far the global leading sport Intermediation addressable media market (Sport agencies) is more cyclical Growth prospects remain favourable SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORM
Slide 23: What is Lagardère Unlimited about?
Investor day presentation agenda 2 What is Lagardère Unlimited about? 1 I Why be active in the sports business? 2 I What is Lagardère Unlimited About? 3 I Lagardère Unlimited recent performance 4 I Lagardère Unlimited vision 2015 5 I Lagardère Unlimited 2011-2012 outlook 6 I Questions and answers se
Slide 24: Lagardère Unlimited is set up to support Lagardère ambitions
Lagardère Unlimited is set up to support Lagardère ambitions in Sports and Entertainment businesses Organizer of the 2010 Swedish Open tennis tournament held in Båstad 2009 (ATP tour) European leader in American company specialized in sports the management of 2008 personalities and sports marketing
Slide 25: 2011 perimeter will be enlarged
2011 perimeter will be enlarged Lagardère Unlimited perimeter evolution 2010 2011 PERIMETER CHANGE Lagardère Live PERIMETER CHANGE Entertainment UK / France Revenues 2010E 383 M€ +13 M€(1) 2010 figures are provisional and unaudited = 396 M€ (1) BEST contribution for 8 months of activity in 2010 Sour
Slide 26: Lagardère Unlimited value chain
Lagardère Unlimited value chain is about enhancing value of properties through rights, events management and content packaging Own properties Structure and trade Operate Produce live and Structure concepts rights and manage events in studio content for the benefit of Media Venue property owners Mark
Slide 27: Value chain: rights negotiation, events management and content production
Lagardère Unlimited value chain is about enhancing value of properties through skilled rights negotiation and structuring, quality events management and state-of the art content production and distribution SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I 2
Slide 28: Entertainment business is a natural extension of Lagardère Unlimited
Entertainment business is a natural extension of Lagardère Unlimited Lagardère Unlimited value chain A natural extension of the business… Sports Live and unique events Strong overlaps of involved stakeholders (broadcasters, arenas, sponsors) Similar requirements throughout the value chain: Concept d
Slide 29: Expansion in new sports, geographies and across the value chain
Since 2008, Lagardère Unlimited has expanded in new sports, geographies and across the value chain 2008 announced strategy 2010 Key Facts 1 Increasing share of revenues in Africa and expansion Geographical 1 expansion of marketing activities to new countries in Europe 2 Olympic games 2014 / 2016 med
Slide 30: Portfolio expanded outside of football
Lagardère Unlimited has expanded its portfolio outside of football Overview of Lagardère Unlimited Other sports business by sport - In % revenues(1), 2010 - Rugby Tennis Cricket Golf Football 2010 figures are provisional and unaudited (1) Business models effects not included (commission vs. buy out)
Slide 31: Operates in major sports across main regions
Lagardère Unlimited operates in major sports across main regions Lagardère Unlimited sports footprint by region Europe & Middle East North Latin Africa & Asia America America Football Golf Cricket Tennis Rugby Athletics US Sports Winter sports Olympic Games SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLI
Slide 32: Main revenues from media and marketing rights in Football, Cricket and Golf
Lagardère Unlimited main revenues come from media and marketing rights management in Football, but also in Cricket and Golf Marketing Media Talents Owned competitions Consulting Talents Academies UK Talents France SIZE PROPORTIONAL TO REVENUES SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ?
Slide 33: Lagardère Unlimited strengths
Lagardère Unlimited strengths Lagardère Unlimited key strengths Growth driver for Lagardère Market key facts Leader on the greatest sport Growing market Global reach and expertise Live and unique content network Worldwide opportunities Lagardère Unlimited Consolidation in progress differentiation el
Slide 34: Key highlights
Key highlights Lagardère Unlimited is set up to support Lagardère ambitions in Sports and Entertainment businesses Sports entertainment value chain is about enhancing value of properties through rights, event management and content packaging Lagardère Unlimited has a strong expertise across this val
Slide 35: Lagardère Unlimited recent performance
Investor day presentation agenda 3 Lagardère Unlimited recent performance 1 I Why be active in the sports business? 2 I What is Lagardère Unlimited About? 3 I Lagardère Unlimited recent performance 4 I Lagardère Unlimited vision 2015 5 I Lagardère Unlimited 2011-2012 outlook 6 I Questions and answer
Slide 36: Revenues and EBIT for 2007-2010E
Lagardère Unlimited revenues and EBIT for 2007-2010E Lagardère Unlimited Revenues and EBIT evolution - in M€, 2007-2010E - 507 75 REVENUES 440 2% EBIT 444 67 396 56 3% 64% 48% 55% 28 52% 34% 42% 2007 2008 2009 2010E 2007 2008 2009 2010E Buy out revenues 2010 figures are provisional and unaudited Com
Slide 37: Negative impact of calendar explains most of 2010 low EBIT
Negative impact of calendar explains most of 2010 low EBIT Lagardère Unlimited EBIT evolution(1) – bridge analysis - in M€, 2008-2010E - 74 0 Calendar effect : UEFA qualifiers & friendlies Perimeter : Euro 2008 final phase WSG (2009)(2) -33 BEST (2010) -13 28 0 Contract loss : Europa League 2010 fig
Slide 38: Media – Rights owners rely on agencies to monetize assets
Media – Rights owners rely on agencies to upfront monetize their assets Buy out model Commission model Role Principal Service provider Typical right Federations media rights • Clubs Marketing owners and type • Leagues Media Rights Risk Rights selling (price)< Rights buying (price) Rights owner reven
Slide 39: Media – strong media rights portfolio in Football worldwide
Media – Lagardère Unlimited has a strong media rights portfolio in Football worldwide FOOTBALL OTHER SPORTS Leagues & clubs Federations 2010E Sales 46% Qualifiers contribution International rights Europe 2010 figures are provisional Qualifiers 2014 & 2016 and unaudited Final phase (Asia) And 4 other
Slide 40: Marketing – Comprehensive marketing concept
Marketing – Comprehensive marketing concept is a unique concept developed to enhance marketing revenues 12 9 Clubs examples (comprehensive) 2010E Sales 40% Borussia Dortmund contribution Bayer 04 Leverkusen 2010 figures are provisional Hertha BSC and unaudited Hamburger SV 12 Overview of portfolio 8
Slide 41: Events management
Events management – Lagardère Unlimited leverages its expertise with talents, teams, organizations, sponsors and broadcasters to maximize event impacts 2010E Sales 12% contribution Exhibitions & Friendlies Existing events New events creation 2010 figures are provisional Key Relationship with teams a
Slide 42: Talent – growing position in talent representation
Talent – Lagardère Unlimited is consolidating a growing position in talent representation 64 44 2010E Sales 2% Talents examples contribution 2010 figures are provisional US and unaudited sports Reggie Bush Michael Vick Basketball Dwight Howard N.FL. Joakim Noah Overview of portfolio - # of talents -
Slide 43: Key highlights
Key highlights Recent low performance can be explained by: Impact of calendar Contract loss Lagardère Unlimited is building and already leveraging a broad expertise in the various business segments, allowing us to be confident in our 2015 prospects SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABO
Slide 44: Lagardère Unlimited vision 2015
Investor day presentation agenda 4 Lagardère Unlimited vision 2015 1 I Why be active in the sports business? 2 I What is Lagardère Unlimited About? 3 I Lagardère Unlimited recent performance 4 I Lagardère Unlimited vision 2015 5 I Lagardère Unlimited 2011-2012 outlook 6 I Questions and answers sessi
Slide 45: 3 main origins for sport agencies within current competition
There are 3 main origins for sport agencies within current competition panel Mapping of a selection of sports marketing agencies GENERALISTS BROADCASTERS SPONSORS Few competitors have been able to integrate specificities of the 3 main Formula One stakeholder types in the sports Management entertainm
Slide 46: Lagardère Unlimited combined capacities to meet stakeholders' specificities
Despite a strong historical link with rights owners, Lagardère Unlimited has combined capacities and expertise to meet stakeholders’ specificities Mapping of Lagardère Unlimited entities GENERALISTS BROADCASTERS SPONSORS RIGHTS OWNERS SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT
Slide 47: Broadened global presence along the value chain
Lagardère Unlimited has broadened its global presence along the value chain Overview of origin and DNA for the sport market players Global Reach Globalization level: Local Regional Global SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I 2011-2012 OUTLOOK I
Slide 48: Positive 2011-2013 momentum
Lagardère Unlimited should benefit from a positive 2011-2013 momentum Historic cycle Future cycle 2008 2009 2010 2011 2012 2013 Calendar of major events Euro Final Phase Lagardère Unlimited properties Euro Qualifiers World Cup Qualifiers Asian Cup Olympic Tournament Qualifiers World Cup Qualifiers (
Slide 49: Diversifying models across the value chain
Lagardère Unlimited is diversifying its models across the value chain Lagardère Unlimited portfolio examples Partnership / End to end AFC, African Cup of Nations, properties management One Asia golf tournament Talent Management Tennis, NFL, NBA athletes Media rights management UEFA Federations portf
Slide 50: Illustrative business models – AFC
Illustrative business models – AFC scope and implemented synergies AFC value evolution Centralize control Create a variety of Deliver maximum Production of within governing structured rights exposure for rights quality content body Market to Develop venue & Maximize Restructure sponsors and media ev
Slide 51: Illustrative business models
Illustrative business models Centralize rights Package Increase playing Maximize Consolidate corporate opportunities and broadcast tournament golf partnerships standards opportunities and across the region in Deliver pan-Asian Create high- reach worldwide all major markets marketing platform profile
Slide 52: Organic growth program for the next sports cycle
An organic growth program is in place to prepare for the next sports cycle beyond 2013 Lagardère Unlimited growth plan SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I 2011-2012 OUTLOOK I Q & A 51
Slide 53: Plan for growth: geographical, business and sports development
Plan for growth is structured around geographical, business and sports development opportunities Lagardère Unlimited plan for growth Marketing Media 2010 2015 SPORTS Sport strategy Expand Consolidate Expand Develop Sports Football Football Golf Golf Tennis VALUE CHAIN Tennis Various Cricket Mass eve
Slide 54: Targets to further expand sports and geographies
Lagardère Unlimited targets to further expand sports and geographies Definition of Lagardère Unlimited sports target footprint by region Europe & Middle East North Latin Africa & Asia America America Football Golf US Sports Tennis Cricket Athletics Rugby Motor sports Winter sports Others Others non
Slide 55: Key highlights
Key highlights Lagardère Unlimited is clearly a major global player active on key sports and geographies Lagardère Unlimited should benefit from a positive calendar effect for 2011-2013 A growth plan is in place to achieve 2015 objectives SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I REC
Slide 56: Lagardère Unlimited 2011-2012 outlook
Investor day presentation agenda 5 Lagardère Unlimited 2011-2012 outlook 1 I Why be active in the sports business? 2 I What is Lagardère Unlimited About? 3 I Lagardère Unlimited recent performance 4 I Lagardère Unlimited vision 2015 5 I Lagardère Unlimited 2011-2012 outlook 6 I Questions and answers
Slide 57: Methodology suggestions
Methodology suggestions Sporting events calendar: to significantly offset its impact on sales growth numbers, compare odd years between themselves – same with even years Buy-out sales vs commissions: to assess a sales growth performance free of the impact of the evolution of the mix buy-out sales vs
Slide 58: Key indicators Lagardère Unlimited
Key indicators Lagardère Unlimited M€ 2009 2010E Consolidated sales 507 396 Sales, at constant rate (2009) – (a) 507 391 Amortization of sports rights – (b) 136 83 Gross margin (c) = (a) – (b) 371 308 Impact of contract losses (d)(1) 50 12 Base gross margin = (c) – (d) 321 296 2010 figures are provi
Slide 59: Key indicators
Key indicators M€ 2009 2010E Base gross margin 321 296 Including Media 163 113 Including Marketing 148 141 Others & Events sales 10 42 2010 figures are provisional and unaudited SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I 2011-2012 OUTLOOK I Q & A 58
Slide 60: Ratio
Ratio Recurring Ebit margin ratio 2009 2010E Media 30% 18% Marketing 13% 12% 2010 figures are provisional and unaudited SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I 2011-2012 OUTLOOK I Q & A 59
Slide 61: 2009-2011 Toolkit
2009-2011 Toolkit Gross margin expected growth Up to market growth Recurring Ebit margin, media 30% - 40% Recurring Ebit margin, marketing 10% - 15% Overheads & other activities recurring Ebit -17M€ to -23M€ SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITED ABOUT ? I RECENT PERFORMANCE I VISION 2015 I
Slide 62: 2010-2012 Toolkit
2010-2012 Toolkit Gross margin expected growth 3% - 8% Recurring Ebit margin, media 20% - 30% Recurring Ebit margin, marketing 15% - 20% New events & other opportunities Further Ebit improvement Overheads & other activities recurring Ebit -17M€ to -23M€ SPORTS BUSINESS ? I WHAT IS LAGARDÈRE UNLIMITE
Slide 63: Questions and answers session
Investor day presentation agenda 6 Questions and answers session 1 I Why be active in the sports business? 2 I What is Lagardère Unlimited About? 3 I Lagardère Unlimited recent performance 4 I Lagardère Unlimited vision 2015 5 I Lagardère Unlimited 2011-2012 outlook 6 I Questions and answers session