Slide 1: July 24, 2018
July 24, 2018 technicolor.com
Slide 2: Forward-looking statements
contains certain statements that are based on constitute "forward-looking management's current expectations and statements", including but not beliefs and are subject to a number of limited to statements that are risks and uncertainties that could cause predictions of or indicate future actual resul
Slide 3: H1 2018 group highlights
Change YoY in € million H1 2017 H1 2018 At current rate At constant rate Revenue 2,098 1,769 ( 1 5 . 7)% ( 9 . 3 )% Adjusted EBITDA 82 57 ( 3 1 . 0)% ( 2 0 . 0)% Free Cash Flow (109) (150) ( 3 7 . 7)% ( 3 8 . 0)% ► YoY revenue decrease: in line with expectations ► Adjusted EBITDA at €57 million ► FC
Slide 4: Production Services highlights
► c. 5% YoY revenues growth in H1 driven by: ► Growth Movie and advertising strong performance offset partly by Accelerate organic capacity expansion unfavorable calendar impact in Animation in Australia, Canada, France and India for the coming years ► YoY adjusted EBITDA improvement driven by h
Slide 5: DVD Services highlights
► Volumes down c. 13% YoY driven mainly by: ► Key facility/operational Standard and CD volume decline partly offset by strong restructuring & optimization Blu-rayTM volume growth and 4K UHD development Continued consolidation of manufacturing & distribution ► H1 revenues decline of 9.5% at const
Slide 6: Connected Home market and three-year transformation plan
CPE A LARGE AND RESILIENT MARKET TECHNICOLOR COMMITTED TO MAINTAINING ($16.4bn in 2018): MARKET LEADERSHIP POSITION THROUGH $6.8bn broadband growing +4% CAGR BEST IN CLASS DELIVERY CAPACITIES AND (increasing home access to the internet and COST STRUCTURE bandwidth upgrades) $9.6bn video declinin
Slide 7: Key highlights
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Slide 8: Agenda
Slides 9 to 11 Slides 12 to 17 Slides 18 to 26 Slides 28 to 29 Slides 30 to 32
Slide 9: Performance by division
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Slide 10: Group financial summary
vs. LY vs. LY at constant rate 2018 2017 (a) Forex impact (c=a+b) (b) (in € million) Current rate LY Rate LY Rate Current rate LY rate Revenues 1,769 1,904 2,098 (329) (15.7)% +135 (194) (9.3)% Adjusted EBITDA 57 66 82 (26) (31.0)% +9 (16) (20.0)% in % of Revenues 3.2% 3.5% 3.9% D&A & Reserves (*) w
Slide 11: Adjusted EBITDA bridge H1 2018 vs H1 2017
Adjusted EBITDA H1 2018 vs. H1 2017, in € million (20)% (16) (9) 82 66 57 H1 2017 Business Performance H1 2018 Comparable FX H1 2018 Adjusted EBITDA Adjusted EBITDA Adjusted EBITDA at LY rate at Current Rate 11
Slide 12: Performance by division
Slide 13: Connected Home revenues and adjusted EBITDA
Revenues (in € million) @ Current rate Title 1,252 REVENUE HIGHLIGHTS: 1,003 ► YEAR-ON-YEAR DECLINE DUE TO: 504 unfavorable comparison with prior year when Technicolor benefited Broadband 460 from a sole supplier role at Charter for the launch of the WorldBox the implementation of the selectivit
Slide 14: Connected Home financial results
vs. LY Proforma vs. LY proforma 2017 2018 at constant rate proforma(**) (a) Forex impact (c=a+b) (b) Connected Home Current rate LY Rate LY Rate Current rate LY rate In € million Revenues 1,003 1,081 1,252 (249) (19.9)% +79 (170) (13.6)% Adjusted EBITDA 26 31 53 (27) (51.7)% +5 (22) (42.1)% in % of
Slide 15: Production Services revenues and adjusted EBITDA
RevenuesSeries (in €1million) @ Current rate REVENUE HIGHLIGHTS: ► UP C.5% AT CONSTANT RATE record-breaking revenue performance in Film & TV Visual Effects (“VFX”) high single digit revenue growth year-over-year in Advertising VFX 383 376 solid Postproduction level of activity in the US but lo
Slide 16: DVD Services revenues and adjusted EBITDA
Revenues (in € million) Series 1 @ Current rate REVENUE HIGHLIGHTS: ► DOWN C.10% AT CONSTANT CURRENCY COMPARED TO THE FIRST HALF OF 2017 REFLECTING: Standard Definition DVD volume declined by 18% reflecting the ongoing shift to the Blu-ray 12% increase in Blu-rayTM discs volumes supported by a s
Slide 17: Entertainment Services financial results
2017 vs. LY proforma 2018 vs. LY Proforma (a) at constant rate Proforma(**) Forex impact (c=a+b) (b) Entertainment Services Current rate LY Rate LY Rate Current rate LY rate in € million Revenues 756 812 838 (82) (9.8)% +56 (26) (3.1)% Ajusted EBITDA 55 59 64 (10) (14.8)% +4 (5) (7.9)% in % of Reven
Slide 18: Group financial results
Slide 19: Adjusted EBITDA to EBIT
vs. LY at vs. LY 2018 2017 constant rate (a) Forex impact (b) (c=a+b) in € million Current rate LY Rate LY rate ∆ @ CR ∆ @ LY Adjusted EBITDA 57 66 82 (26) +9 (16) D&A & Reserves (*) w/o PPA (82) (88) (82) +1 (6) (6) amortization PPA amortization (22) (24) (25) +3 (2) +1 Impairments & write-off (3)
Slide 20: EBIT to net result
vs. LY at vs. LY 2018 2017 constant rate (a) Forex impact (b) (c=a+b) In € million Current rate LY Rate LY rate ∆ @ CR ∆ @ LY EBIT Continuing (106) (107) (57) (49) (1) (50) Net Interest Expense (19) (19) (24) +5 (0) +5 Others Financial (2) (2) (38) +35 +1 +36 Profit before tax (127) (128) (119) (8)
Slide 21: Free cash flow bridge
Adjusted Net Net Pensions FCF H1 2017 EBITDA Capex Restructuring ∆ WC/OAL Financial Tax and Other Forex FCF H1 2018 (109) (150) (16) (11) (3) (18) +18 (12) +1 0 €(41) million 21
Slide 22: Debt structure
In € million Nominal IFRS June 30, 2018 December 31, 2017 Type Curr. Rate Formula Maturity Rate Rate Nominal IFRS Nominal IFRS Term Loan USD Libor w/ floor of 0% + 2.75% Dec-23 5.06% 5.18% 254 253 249 248 Term Loan EUR Euribor w/ floor of 0% + 3.00% Dec-23 3.00% 3.11% 275 273 275 273 Term Loan EUR E
Slide 23: Debt covenants and maturities
Debt/Credit line Financial Covenant Covenant Testing Maturity Term Loans None NA December 2023 (bullet except for $3m/year of amortization) EIB Loan Group IFRS Debt / Group At June 30 and Dec 31 January 2023 (bullet) EBITDA 4.00 Revolving Credit Facility (RCF) Group IFRS Debt / Group At June 30 an
Slide 24: Debt repayment schedule
COMMENTS: 1000 No significant mandatory debt repayments until December 2023 900 800 700 In € millioni 600 1,057 500 400 300 200 100 9 23 9 10 5 0 2018 2019 2020 2021 2022 2023 Mandatory repayments 24
Slide 25: Net debt evolution
in € million 01 Jan. FCF CF New cash Other 30 Jun. Continuing Disco. from debt 2018 2018 (150) +30 (13) +12 319 Cash 197 position (13) +23 Others Gross Debt repayments Nominal 1,103 1,113 Debt Net debt at 784 916 nominal value 25
Slide 26: Liquidity at June 30, 2018
Liquidity at June 30, 2018 Amount (in € million) Cash on hand at June 30, 2018 197 Committed credit facilities: Technicolor SA Revolving Credit Facility (€250m matures Dec 2021) 250 Crédit Agricole credit line (€35m matures May 2019) 35 Wells Fargo credit line ($125m matures September 2021) 107 LIQU
Slide 27: Restructuring savings and costs
Yearly Incremental FY Run Rate SAVINGS in € million 2018 2019 – 2021 2021 Total 45 95 140 At end H1 RESTRUCTURING in € million H2 2018 2019 - 2021 Total 2018 COST Total 35 15 40 90 PAYBACK < 15 MONTHS CASH/NON CASH MAINLY CASH 27 27
Slide 28: Appendices to consolidated accounts
Slide 29: Revenue breakdown by division and region
H1 18 H1 18 DVD Europe, Services Middle-East 21% & Africa 22% 24% 23% Connected North Home 53% America 60% 57% H1 17 H1 17 46% 8% 18% Asia-Pacific Production 10% 0% Services 16% 21% Corporate & Other Latin America 1% 20% 29
Slide 30: Technicolor: Feel the Wonder
| technicolor H1 Ce alll FEELTHE WONDER
Slide 31: 2017 proforma adjusted EBITDA after cost reallocation
2017 PROFORMA FOLLOWING CORPORATE COST REALLOCATION AS FOLLOWS: H1 2017 H2 2017 FY 2017 In € million As published Proforma As published Proforma As published Proforma Entertainment Services 72 64 159 152 230 216 Connected Home 57 53 80 75 137 128 Corporate and Other (47) (35) (30) (18) (76) (53) Adj
Slide 32: 2017 proforma adjusted EBIT after cost reallocation
2017 PROFORMA FOLLOWING CORPORATE COST REALLOCATION AS FOLLOWS: H1 2017 H2 2017 FY 2017 In € million As published Proforma As published Proforma As published Proforma Entertainment Services (2) (10) 78 71 76 61 Connected Home 28 24 33 28 61 52 Corporate and Other (51) (39) (33) (21) (84) (60) Adjust
Slide 33: Thank you
THANK YOU technicolor FEEL THE WONDER