PubliGroupe - First Half Year 2010
- 1. Connecting media, advertisers and customers First Half Year 2010 www.publigroupe.com 1 Lausanne 30 August 2010 Content 1. First Half Year 2010 Key figures & main developments y g p (Thomas Kaiser - Deputy CEO) 2. First Half Year 2010 Financial Results (Andreas Schmidt - CFO) 3. Conclusions & Outlook 2010 (Thomas Kaiser) 2
- 2. First Fi t HY 2010 K fi 2010: Key figures & main d i developments l t Thomas Kaiser - Deputy CEO PubliGroupe 3 1. First HY 2010 results - Consequent strategy implementation Group results are gradually recovering and the return to profitable growth has set in thanks to progress achieved in all its defined strategic initiatives: Recap PubliGroupe reports positive h lf P bliG t iti half-year results lt (both before and after elimination of extraordinary items) Improved results at ‘Media Sales business Media Sales’ segmentwith a significantly reduced operating loss Acquisitive and organic growth in online services p paved PubliGroupe’s return to black figures p g Substantial additional cost savings Source: FY2009 results presentation, 19 March 2010 4
- 3. 1. First HY 2010 results - Key figures Hesitant economic recovery/ongoing structural Sales and GM, in CHFm market changes: 2009 2010 – Recovery in Asia and the Americas, 1'000 Switzerland and EU still hesitant, but 798.4 800 714.1 positive trend – Print-based media under pressure 600 Growth of online marketing services g 400 164.8 153.4 Positive results on group level: 200 – Further cost reductions of CHF 27m 0 (Media Sales d (M di S l and HQ) Net Sales Gross Margin – Overall improvement of Medias Sales results EBIT and Net profit, in CHFm – +38.4% growth in online marketing services ( (incl. minority p y participations) p ) 2009 2010 30 27.1 20 Financial results HY 2010 on budget level: 12.4 – Group sales -10.6% to CHF 714.1m 10 – Gross margin -6.9% to CHF 153.4m 0 – Positive EBIT of CHF 12.4m -3.5 -10 -8.5 – Positive net result of CHF 27.1m -20 EBIT Net Profit 5 1.First HY 2010 results - Business segments summary EBIT, in CHFm per Segment HY 09 EBIT HY 10 EBIT 0 Media Sales and Custom Publishing improve EBIT mainly due to cost DMS pro forma 09* DMS pro forma 10* reductions and the recovery in 15 international and electronic media 11.5 sales markets 10.5 10 7.3 Online and transaction-oriented 5.6 business segments continue to 5 4.5 perform solidly: 2 – Search & Find: slight EBIT 0 reduction reflecting investment in -1 reported pro -1.8 forma new home.ch online platform -3.1 -5 – Digital & Marketing Services: Pro forma EBIT* shows strong operational performance -10 -15 -14.4 Media Custom Search Digital & *eliminating one time gain of CHF 3.8m in 2009, PG HQ cost allocated, all Sales Publishing & Find Marketing amortization of intangible assets interest and taxes for PG’s share to the assets, PG s result of Zanox group Services 6
- 4. 1. Status strategic initiatives - Reorganisation and cost reduction Achieved cost savings of CHF -27.1m in Media Sales and HQ Corporate Targeted cost saving effect CHF -38m in Media Sales and HQ Corporate 38m Headcount reduction by 242 FTE at Media Sales and HQ Corporate (12 months) Reorgani- sation and HY: CHF -27m CHF -22m CHF -55m cost FY: >CHF -38m reduction 2007 2008 2009 2010 7 1. Status strategic initiatives - Divestment of non-core assets Ongoing divestment of non-core assets – Real estate: Baden – Non core holdings of publishing houses: BAZ Medien, Edipresse Non-core Medien Credit financing agreements – Long term mortgage of CHF120m – CHF 90 credit li 90m di line f ll paid b k fully id back Debt reduced by CHF 45m to CHF 120m Strong balance sheet with 46.6% equity ratio Target: maintain investment capacity of CHF 50m plus Real estate 37% BAZ Medien / Divestment Winterthur 19.9% Edipresse Real estate of non-core Zürich assets 100% Stadt- Real estate Baden / anzeiger Olten Lausanne (2nd HY) 2007 2008 2009 2010 8
- 5. 1. Status strategic initiatives - Investing in growth markets Performance Marketing: – Build the leading European online affiliate marketing group together with Axel Springer – Acquisition of Buy.at in March 2010 leads to European market leadership – Regrouping of JV-entities under one roof since July 2010 to form Zanox Group – CHF 242m sales in first HY 2010 – Build a comprehensive offering in digital marketing on the Swiss market – Repositioning of web2com – Acquisition of Instanz in May 2010 complements web2com, Namics and Zanox performance marketing offering Local Search Marketing: – Build the number one local search platform in Switzerland together with Swisscom – New setup of the JV with Swisscom to boost online services and to gain synergies – Promising market entry of new national real estate online portal home.ch Investments in growth markets 2007 2008 2009 2010 9 1. Status strategic initiatives - Growing importance of online businesses Online Revenues PubliGroupe, p , Online Revenues, , in CHFm in CHFm PG incl. participations MediaSales Search&Find DMS (excl.zanox) PG (excl. Zanox) zanox zanox/DW/Buy.at 80 + 17.7 % 350 70 300 + 38.4 % 60 26.9 250 50 23.2 200 241.7 40 27 150 165.4 30 22.6 20 100 10 15.5 18.2 50 72.1 61.3 0 0 2009 HY1 2010 HY1 2009 HY1 2010 HY1 PubliGroupe further expands its position as a key player in the online market in Switzerland and Western Europe 10
- 6. 1. Status strategic initiatives - Turning media sales business around Recap Achievements 2010 New longterm contracts with major media g p on g j groups national and international level (NZZ, Neue Luzerner Zeitung, St. Galler Tagblatt, Thurgauer Zeitung, Le Nouvelliste, La Liberté, Corriere del Ticino, etc.) Negotiations based on new business model with all major Swiss media groups underway, first contracts signed Migration of all ~900 existing contracts with small and midtier media groups in Switzerland whereof Switzerland, more than 400 "full service" contracts Successful launch of new B2C and B2B online tools New logistics service offering well received by large media groups Strong interest to outsource non-strategic ad production processes Digital platform project and business process outsourcing setup well advanced Source: FY2009 results presentation, 19 March 2010 11 2. First 2 Fi t HY 2010 Fi Financial Results i lR lt Andreas Schmidt - CFO PubliGroupe 12
- 7. 2. First HY 2010 - Profit & Loss statement Group CHF Mi Mio Change % Ch HY1 2010 HY1 2009 Revenue -10.6% 714.1 798.4 Gross margin -6.9% 153.4 164.8 Expenses -12.0% -149.4 -169.7 EBITDA – 4.0 -4.9 EBIT – 12.4 -3.5 Financial result – 16.4 -3.8 Net Result – 27.1 27 1 -8.5 85 13 2. First HY 2010 - EBIT IFRS vs. EBIT pro forma 12.4 EBIT IFRS CHF 12.4m 1.8 Eliminating one-off costs from – impairments CHF 1 8m 1.8m – provisions and others CHF 2.5m 2.5 8.8 Eliminating one-off gains from – divestments CHF 8.8m 7.9 EBIT pro forma CHF 7.9m 0 5 10 15 20 25 EBIT pro forma improves by 20.2m (Year-on-Year) reflecting true operational performance 14
- 8. 2. First HY 2010 - Group Net result, extraordinary items Net Res lt HY1 2010 - Nominal Result 27.1 27 1 Impairments -1.8 Provisions and others -3.5 Divestments 24.9 Total non recurring elements 19.6 Net Result HY1 2010 - Comparable 7.5 Balance of non recurring items is a net gain of CHF 19.6m HY1 2009 comparable Net Result was -12.5m 15 2. First HY 2010 - Comparable expenses by segment CHF Mio % HY1 2010 HY1 2009 Search & Find 9.4% -31.6 -28.8 Media Sales -21.2% -93.0 -118.0 Custom Publishing -20.8% -5.1 -6.4 Digital & Marketing Services 2.7% -24.1 -23.5 Corporate & Others -57.7% -7.4 -17.4 Comparable expenses p p -14.0% -155.7 -181.0 Non recurring elements -44.1% 6.3 11.3 Total expenses -12.0% 12 0% -149.4 149 4 -169.7 169 7 14% overall expense reduction on comparable basis 16
- 9. 2. First HY 2010 - Media Sales & HQ: Comparable expenses evolution CHF Mio Media Sales HQ Corporate 175 Decisive cost reduction efforts in Media Sales and Corporate HQ since 2008 150 -13.3 15.9 12.9 -14.3 125 11.3 -13.2 10.4 -13.9 100 9.3 93 141.0 141 0 130.7 118.0 75 105.7 93.0 50 HY1 2008 HY2 2008 HY1 2009 HY2 2009 HY1 2010 17 2. First HY 2010 - Number of employees evolution FTE 3'200 Significant but also selective FTE reduction since 2008 -50 3'000 -205 2 800 2'800 -180 3'053 3'003 2'600 2'798 -241 2'400 2'618 2'377 2'200 2008.06 2008.12 2009.06 2009.12 2010.06 18
- 10. 2. Business Segment Media Sales - Financial results first HY 2010 Sales, in CHFm Operating loss reduced to CHF -3.1m 800 Strong improvement due to: 656.3 – Cost reductions of CHF 25m 600 585.4 – Recovery and positive contribution of – international markets (+4%) 400 – electronic media (+58%) l t i di 200 Sales down by 10.8% to CHF 585.4 due to: – anticipated decline of -18% in Swiss press 0 advertising activities 2009 HY1 2010 HY1 – decline attributable to the end of exclusive Gross Margin and EBIT, in CHFm cooperation with 3 publishers – -5.9% like for like decline - in line with 2009 2010 120 market evolution 102.1 93.5 – Q1: -10.3% / Q2: -1.4% 80 New modular service offering for Swiss p g press ready y 40 – implementation underway – essential for overall turnaround in 2011 0 -3.1 -14.4 New CEO since 1 May -40 40 Gross Margin EBIT 19 2. Business Segment Custom Publishing - Financial results first HY 2010 Sales, in CHFm Further reduction in advertising revenue 15 12.7 and contracts value – Sales -20.5% to CHF 10.1m 10 10.1 – Gross margin -14% to CHF 4.3m 5 EBIT of CHF -1m – Improvement of CHF 0.8m vs. 2009 0 2009 HY1 2010 HY1 Good development of movie brokerage Gross Margin and EBIT, in CHFm business in Asia 2009 2010 6 5 Dynamisation of corporate publishing market 4.3 4 underway - New management in CH 2 0 -1 -2 2 -1.8 Gross Margin EBIT 20
- 11. 2. Business Segment Search & Find - Financial results first HY 2010 Sales, in CHFm 60 Online services grow by 19%, accounting for 36% of revenues 42.9 46.3 46 3 Print products in CH decline by -10% 40 Segment gross margin declines -2.2% to CHF 31 6m 31.6m 20 Segment revenue grows by 7.9% due to changes in sales resp. and altered treatment of online revenues among JV entities g 0 2009 HY1 2010 HY1 Gross Margin and EBIT, in CHFm EBIT declines by CHF -1m to CHF 10.5m 2009 2010 influenced by the launch of new products Launch of national real estate search portal : 40 www.home.ch 32.3 31.6 Profitability to increase in the future with new setup 20 11.5 of the JV 10.5 Acceleration of development in online services + 0 cost- & growth-synergies t th i Gross Margin EBIT 21 2. Business Segment Digital & Marketing Services - Financial results first HY 2010 Digital & Marketing Services continues to expand DMS Sales, in CHFm their performance-based online marketing services Digital CH SVB with two acquisitions closed in the first half-year half year 100 -15% (buy.at, Instanz) 75 The international group Zanox established itself as 64.3 the European leader in the industry with a sales 50 51.2 volume of CHF 241.7m recorded for the first HY 2010 25 23.1 23 The reported EBIT amounts to CHF 2m compared 0 to 0 7 in the t 0.7m i th same period l t year ( t i l di i d last (not including HY 2009 HY 2010 a non-recurring book gain of CHF 3.8 million on DMS Gross Margin and EBIT, in CHFm participations) HY 2009 HY 2010 Pro forma EBIT* increases by 30% to EBIT 30 25.1 24.5 CHF 7.3m 25 The sales decline of -15.2% and the reduction in 20 DMS pro forma EBIT* g gross margin of 2% are attributable to Dutch g 15 subsidiary SVBmedia (traditional media ‘billings’) + 30 % 10 7.3 and to EUR/CHF currency effects. 5.6 pro forma 5 vs. * Pro forma EBIT = eliminating one time gain of CHF 3.8m in 2009, PG HQ costs 0 allocated, allocated all amortization of intangible assets interest and taxes for PG’s share to the assets, PG s - 56 % Gross Margin EBIT result of Zanox group reported 22
- 12. 2. First HY 2010 - Cash flow statements CHF Mio Change 2010 2009 Cash and cash equivalents as of 1 January - 28.7% 58.0 81.4 Cash flows from operating activities -30.3 -28.3 Cash flows from investing activities g 95.3 16.0 Cash flows from financing activities -44.8 -33.8 Effect of exchange rates -0 3 0.3 1.4 14 Cash and cash equivalents as of 30 June - 77.9 36.7 23 2. First HY 2010 - Consolidated Balance Sheets CHF Mio Change HY1 2010 HY1 2009 Current assets - 15.5% 452.0 534.9 Non-current assets + 4.9% 4 9% 445.9 445 9 425.1 425 1 Total assets - 6.5% 897.9 960.0 Current liabilities -13.8% 321.4 372.9 Non-current liabilities -3.2% 122.5 126.6 Equity, shareholders of PubliGroupe Ltd. + 0.4% 418.3 416.8 Minority interests -18.3% 35.7 43.7 Total liabilities and equity -6.5% 897.9 960.0 Equity in % of assets 47% 43% Net liquidity 64 59 Bank debt long term 93 100 Bank debt short term 27 65 Bank dept 120 165 The group's balance sheet remains solid The liquidity and debt structure keeps improving 24
- 13. 3. Conclusions & O tl k 2010 3 C l i Outlook Thomas Kaiser - Deputy CEO PubliGroupe 25 3. Conclusions & Outlook 2010 Recap Performance of 2nd quarter 2010 and initial figures for 3rd quarter underline overall positive trend for all key activities Strong growth in Online Marketing segment, but differing market conditions in key markets across Europe Due to baseline effect 2009 the improvements for the 2nd half year will be less evident compared to 1st half year 2010 (ie cost reduction effects) (ie. No significant impact of non-recurring items in 2nd half year 2010 2nd half year will be key for the implementation of the new Media Sales business model Implementation of the initiatives Source: FY2009 results presentation, 19 March 2010 defined with JV partner Swisscom after approval of « Joint control concept » by Swiss Competition Commission Confirmed outlook from March 2010 (see chart) 26
- 14. Connecting media, advertisers and customers C ti di d ti d t Thank you for your attention www.publigroupe.com www publigroupe com 27