media services

Transcription

media services
Pinewood Group plc
A leading provider of studio and related services
to the global screen based industries
Interim Results
1 December 2015
1
DISCLAIMER
This presentation has been prepared by Pinewood Group plc ("Company") and relates to the Company’s financial result for the
period ended 30 September 2015.
This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to
purchase, any Shares or any other securities, nor shall it (or any part of it), or the fact of its distribution, form the basis of, or be
relied on in connection with, any investment decision. Further, this presentation does not constitute a recommendation
regarding any decision to sell or purchase securities in the Company.
No representation or warranty, expressed or implied, is made or given as to the accuracy, completeness or fairness of the
information or opinions contained in this presentation. None of the information contained in this presentation has been
independently verified and no responsibility or liability is assumed for any such information or opinions or for any errors,
omissions or misstatements or otherwise for any other communications or otherwise contained in or referred to in this
presentation, or for any indirect or consequential loss or damage suffered by any person as a result of relying on a statement in,
or omission from, this presentation, and any such liabilities are expressly disclaimed. In particular, but without limitation, no
representations or warranties are given as to the prospects of the Company and nothing in this presentation should be relied
upon as a promise or representation as to the future.
This presentation is not being issued, and is not for distribution in, the United States of America or in any jurisdiction where it is
unlawful or where such distribution would breach any regulatory requirements.
This presentation contains written and oral ‘forward-looking statements’, which include all statements that do not relate solely to
historical or current facts. These forward-looking statements speak only as at the date of this presentation. All forward-looking
statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and other
factors, many of which are outside of the Company’s control that could cause actual results to differ materially from such
statement. The Company undertakes no obligation publicly to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Recipients should be aware there is no guarantee that there will be a
liquid market for the Company's shares in the future.
2
INTERIM RESULTS 2015-16
3
1.
Highlights and KPIs
2.
Financial Review
3.
Operating Review and Strategic Update
4.
Outlook
Ivan Dunleavy
Chief Executive
Chris Naisby
Finance Director
Highlights and KPIs
4
HIGHLIGHTS
5
•
Media Services revenue up 20% to £32.5m
•
Media Services operating profit up 37% to £8.3m
•
Consolidated profit after tax up 13% to £4.3m
•
Adjusted eps up 17% to 9.0p
•
Phase one PSDF to be completed by June 2016, within budget
•
Full ownership of Shepperton Studios with review of existing
masterplan underway
•
Pinewood Atlanta Studios Phase 2 development completed
KPIs
H1 2015-16
H1 2014-15
£32.5m
£27.0m
£8.3m
£6.1m
£12.6m
£9.2m
10.2%
9.3%
Stage occupancy
87%
86%
Media Hub occupancy (as a % of net lettable area)
95%
97%
3
7
(£0.1m)
(£0.3m)
Film finance funding invested by the Group
£1.0m
£1.0m
Film finance funding from third party funds
£3.4m
£6.4m
£4.3m
£3.8m
9.0p
7.7p
£6.7m
£11.5m
£55.8m
£31.8m
Media Services
Revenue (including inter-segment)
Operating profit before exceptional items
EBITDA
Return on capital employed
Media Investment
Number of active Film Production Companies during the year
Loss after tax
Group performance
Profit after tax
Normalised earnings per share
Unrestricted cash generated from operations
Net debt
6
Financial Review
7
REVENUE SPLIT
6 months ended 30 September 2015
Revenue Split by Segment
16%
Media Investment
84%
Media Services
Media Services Revenue Split
External
investment
advisory
15%
Television Media Hub
12%
6%
International
4%
Digital
Content
Services
15%
8
Media Investment Revenue Split
External Film
63%
Film
Production
Companies
85%
INCOME STATEMENT
£000’s
•
•
•
Total revenue -1% with
reduced FPC activity in
Media Investment
during the period
Media Services
operating profit +37%
year on year
Finance costs on
increased debt and
inclusive of £1.0m fair
value movement
•
Underlying earnings
+35% year on year
•
Underlying EPS +17%
including the impact of
new shares issued
9
H1 2015-16
H1 2014-15
% Change
38,246
38,506
(1%)
32,495
27,001
20%
5,980
12,119
(51%)
Operating Profit:
7,034
2,452
187%
Media Services
8,324
6,094
37%
Media Investment
(1,290)
(3,642)
65%
Finance Costs
(3,162)
(1,204)
(163%)
PAT
4,300
3,798
13%
Underlying earnings
5,126
3,798
35%
9.0p
7.7p
17%
Revenue:
Media Services
Media Investment
Underlying EPS (p)
INCOME STATEMENT
£000’s
• Media services margins
include the impact of
the acquisition of SSPP
in December 2014
• Media Services
headline ROCE +10%
• Excluding the PSDF
asset in the course on
construction Media
Services ROCE is
11.7%
• Underlying earnings
+35%. With Media
Investment loss
reduced to £67,000
10
H1 2015-16
H1 2014-15
% Change
12,635
9,169
38%
Margin (%)
39.2%
34.8%
Media Services EBIT
8,324
6,094
Margin (%)
25.8%
23.1%
10.2%
9.3%
10%
Underlying earnings
5,126
3,798
35%
Media Services earnings
5,193
4,104
27%
(67)
(306)
78%
Media Services EBITDA
Media Services ROCE
Media Investment earnings
37%
CASH FLOW
6 mths to
6 mths to
12 mths to
30-Sept
30-Sept
31-Mar
• Operating cash
conversion presented
excludes FPC
operating loss and
restricted cash
£000’s
2015
2014
2015
Unrestricted operating cash flow
6,724
11,469
20,456
Operating cash conversion (%)
83%
218%
203%
(2,339)
(1,070)
(2,463)
• Cash conversion
includes an anticipated
working capital outflow
of £5.7m, in the period,
largely due to the
timing of film starts and
VAT payments
Tax (paid)/received
(428)
(1,170)
(1,012)
Free unrestricted cash flow
3,957
9,229
16,981
(17,493)
(3,615)
(45,586)
28,779
-
-
(23,983)
(827)
35,063
1,234
2,921
(876)
Net (decrease)/increase in cash
(7,506)
7,708
5,582
Total (overdraft)/cash
(1,149)
8,483
6,357
Unrestricted cash
(2,933)
4,136
5,807
1,784
4,347
550
(55,830)
(31,760)
(71,918)
-
(12,004)
-
(55,830)
(43,764)
(71,918)
• Investment activities
spend includes PSDF
spend of £13.9m and
Atlanta investment of
£1.6m
Interest paid
Investment activities
Proceeds from share issue
Financing activities
Restricted cash movement
Restricted cash
Net debt per Financial Statements
SSPP debt (IFRS 11 adj)
Proforma net debt
11
BALANCE SHEET
Total New Debt Facilities
30
30
31
Sept
Sept
March
2015
2014
2015
181.8
117.8
165.4
Investment property
5.7
5.9
5.8
Investment in Joint Ventures
6.2
9.1
4.0
Intangible & long term assets
5.9
6.2
6.1
Current assets
15.4
28.0
19.2
TOTAL ASSETS
215.0
167.0
200.5
Equity
123.0
87.6
91.5
£m
Assets
Property, plant and equipment
Liabilities
Loans and borrowings
Derivative financial instr.
Current liabilities
Total liabilities
TOTAL EQUITY &
LIABILITIES
NAV per share
Gearing
12
54.7
40.2
78.3
1.2
0.2
0.3
36.1
39.0
92.0
79.4
30.4
215.0
167.0
200.5
214p
177p
185p
43.0%
36.9%
78.6%
109.0
Facilities
£m
RCF
35.0
Term loan
100.0
Core bank facility
135.0
Overdraft
Asset financing
Total
5.0
12.0
152.0
On 17 April 2015, the Group fully repaid and terminated its
previous £85m banking facility and drew under the new £135m
agreement as outlined above for the first time.
Key covenants include:
- Leverage
- Interest cover
- Loan to value
Operational Review and
Strategic Update
13
MEDIA SERVICES
•
Revenue £32.5m (6 months to Sept 2014: £27.0m)
•
Stage occupancy 87% (6 months to Sept 2014 : 86%)
•
Media Hub occupancy 95% (6 months to Sept 2014 : 97%)
•
Major productions hosted in the first half included:
–
•
•
•
•
•
SPECTRE (Eon/MGM), Star Wars: Episode VII The Force Awakens
(Lucasfilm), Beauty and the Beast (Disney)
Pinewood entered in to profit sharing agreement with Jewson for an
initial period of 5 years
DCS work included Everest (Working Title) and Steve Jobs
(Universal Pictures)
TV studios hosted innovative and technically challenging shows,
Dino Autopsy (Impossible Factual) and The Alternative Election
(Zeppotron)
Full ownership of Shepperton Studios and reviewing the masterplan
Pinewood Studio Wales now home to 14 tenant companies
Pinewood Studio Wales
14
SPECTRE © 2015 Metro-Goldwyn-Mayer
Studios Inc., Danjaq, LLC and Columbia
Pictures Industries, Inc. All rights reserved.
Dino Autopsy © National Geographic
© Shepperton Studios Limited
Everest © Universal Pictures
The Alternative Election Night © Zeppotron
INTERNATIONAL
•
Revenue £1.4m (6 months ended 30 Sept 2014: £1.8m) – included in Film
revenue
•
Pinewood Atlanta Studios phase two development completed in June 2015
–
•
Demand has been good with Marvel and Sony occupying facilities
Company continued to provide advice on the design and construction of the
Qingdao Oriental Movie Metropolis, a film facility comprising 45 stages for the
Wanda Group
–
Construction on Phase One commenced in 2015 with the studio complex scheduled to open in 2017
Pinewood Toronto Studios
15
Pinewood Iskandar Malaysia Studios
Pinewood Atlanta Studios
Pinewood Dominican Republic Studios
MEDIA INVESTMENT
•
Content Fund Management
– Advise on the Media Investment Budget
(£30m) for the Welsh Government
• Agreement includes lease of Pinewood Studio Wales
– Advise the Isle of Man Media Development Fund
(£25m)
– Investment advisory and other fees £0.9m (6
months ended 30 September 2014: £0.4m)
•
Content Investment
– Low risk investment of £1.0m by Pinewood during
the year (6 months ended 30 September 2014:
£1.0m)
•
Their Finest Hour and a Half
Kill Your Friends © Altitude Film
Film Production Activity
– Revenue £5.0m (6 months ended 30 September
2014: £11.6m) due to the timing of deal flow
– Activity is earnings and cash neutral at the after
tax level
16
Pressure © Pressure Films Limited
THE PSDF
Artist’s Impression of Fully Completed PSDF
Existing
Existing
Pinewood
Pinewood
Studios
Studios
PSDF
fully
completed
17
THE PSDF - DETAILS
18
•
The PSDF is a demand led expansion programme
•
Three phases of planned development adding a total of 1m sq ft of new facilities
•
PSDF Phase One:
–
Comprises five new large stages
–
The Design and Build contract for Phase One was signed on 19 May 2015 with Sir
Robert McAlpine Limited
–
Development has commenced, with completion scheduled for H1 2016
–
The cost of development will be funded by a combination of the new banking facilities
agreed on 6 March 2015 and equity raised through the issuance of 8m new ordinary
shares on 17 April 2015
Outlook
19
OUTLOOK
•
First six months of the year maintained the positive momentum
reported in our full year results in June 2015.
•
Media Investment deal flow weighted to the balance of the year.
•
The construction of phase one of the Pinewood expansion is on
schedule for completion in June 2016 and is within budget.
•
Encouraged by the visibility we have for the remainder of the financial
year and into the first half of 2016/17
20
Appendix
21
OVERVIEW OF THE GROUP
A leading provider of studio and related services to the global screen based industries
•
Eight decades of operational experience
•
Operational sites in five territories with:
–
–
The National Lottery Live from TV Three
22
Pinewood
SPECTRE
© 2015Studios
Metro-Goldwyn-May
Studios Inc. Danjaq, LLC and Columbia
Pictures Industries, Inc. All rights reserved.
68 stages worldwide; a unique
combination of film facilities
Five HD TV Studios
•
Over 2,000 films have used Pinewood’s
facilities
•
Has hosted 59 blockbuster films with
budgets > $100m in the last 7 years
Pride and Prejudice and Zombies
@ Universal Pictures
Assassin’s Creed © Twentieth Century Fox
Steve Jobs © Universal Pictures
Alice in Wonderland: Through the Looking
Glass © Disney Studios
Star Wars: The Force Awakens © Lucasfilm
LOCATIONS
Pinewood Studios
Pinewood Studio Wales
Shepperton Studios
Pinewood
Productions Ireland
Pinewood Studios
Wales
China Agreement
Pinewood Toronto Studios
Pinewood Atlanta Studios
23
Pinewood Dominican Republic
Studios
Pinewood Iskandar Malaysia
Studios
DRIVERS OF GROWTH
Television
Film
•
Growing global consumer demand,
greater accessibility and quality of
content is driving demand
•
Global box office for films =
c.$36bn in 2014 – increase of 4%
vs 2013 (1)
−
Projected to increase by 6.0%
per annum 2015–2019 (1)
Total film spend in the UK of
c.£1,064m in Q1-3 2015 (c.
£1,156m Q1-3 2014) (2)
•
UK inward investment spend of
c.£909m in Q1-3 2015 (Q1-3
2014: c. £938m) (2)
•
•
Global rise in TV viewing being driven
by pay TV and trend towards highend productions to capture mass
audiences
•
Greater accessibility
•
Spend on UK content rose by 9.4%
to c. £6.46bn (3)
•
UK TV industry revenue generated
c.£13.2bn (3)
•
UK HETV spend c. £564m in Q1-3
2015 (Q1-3 2014: c. £633m) (2)
•
UK HETV tax relief
Chinese box office increased by
36% in 2014 to c.$4.3bn and is
expected to increase by 15.5%
from 2014-2019 to c$8.9bn (1)
•
1:
2:
3:
4:
24
Source: PricewaterhouseCoopers Global Entertainment and Media Outlook 2015-2019
Source: Film, high-end television, animation programmes, and video games production in the UK – Q1-Q3 2015,
BFI Research and Statistics Unit, 3 February 2015
Source: Ofcom Communications Market Report 2015
Source: Nesta - A Map of the UK Games Industry 2014
Games
•
High consumer demand for video
games with cinematic quality
content
•
Continued investment
budget franchises
•
Number of UK games developers
increased at an annual rate of
22% between 2011 and 2013 (4)
•
c. 1,900 games businesses in the
UK contributing c.£1.7bn to the
economy (4)
•
Global video games revenue will
increase by 5.7% from 20142019 to c$93bn (4)
•
UK Video Games tax relief – UK
spend of c. £109m between
October 2014 and September
2015
in
high