2015 Full-Year Results

2015 Full-Year Results
Arnaud Lagardère
General and Managing Partner
9 March 2016
2015
highlights
A solid performance in 2015
Group sales:
Group
key figures
in 2015
(1/2)
€7,193m
+3% like-for-like
→ Ahead of long term objective
Group Recurring EBIT:
€378m
+10.5% on a reported basis
+8.8% on a guidance methodology basis*
→ Ahead of guidance**
Adjusted profit – Group share:
2015 Full-Year Results
9 March 2016
€240m
+29.7%
*At constant exchange rates and excluding the effect of the potential disposal of LS distribution operations.
**The Recurring EBIT was expected to increase by approximately 7% compared with 2014.
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A major improvement of Free cash flow generation in 2015
Group
key figures
in 2015
(2/2)
 Free cash flow of €274m, up €297m compared to 2014, thanks to:
• An increased amount of Cash flow from operations (+€44m);
• A strong focus on Working Capital Requirement (+€229m);
• A decrease of interests and taxes paid (-€41m).
 While maintaining a high amount of Capex (€250m) within the
divisions, in order to fuel future growth.
2015 Full-Year Results
9 March 2016
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 The US, UK and France Trade markets showing growth
and demonstrating resilience.
 Education
2015 highlights
• Slow down in France before 2016 reforms.
• Great performance in Spain and the UK.
 Hachette Livre garnered five of France’s six top literary
awards in fiction.
 Asterix latest album a huge bestseller in Europe.
 E-book
2015 Full-Year Results
9 March 2016
• Reversal of market trends in the US and UK, with a rebound
in volumes of printed books to the detriment of e-books.
• Long term balance from agency contract in place in the US
and now in the UK.
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 The division strategic shift is well on track.
• Lagardère Services changed its name to Lagardère Travel Retail.
• The divestiture of Distribution activities is progressing well.
2015 highlights
 In a complex geopolitical and macroeconomic
environment, Travel Retail momentum remained
strong and growth strategy bore fruits:
• Division sales like-for-like growth of +8.2% in 2015.
 Acquisition of Paradies in October 2015
(more than 520 shops among 75 airports
in North America).
 Development activity was successful with numerous
gains of tenders and successful key renewals, such as:
2015 Full-Year Results
9 March 2016
Abu Dhabi, UK (London - Luton), France (Nice), Luxemburg, Poland (Krakow),
Iceland (Reykjavìk), New Zealand (Auckland), China (Kunming), Singapore,
Hong Kong, Canada (Toronto and Vancouver)…
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 Press
• Audiences One Global*: the audience of our main weeklies
on all devices (print, fixed-line Internet, mobile and tablet) are
all growing.
2015 highlights
 Radio
• Europe 1: #2 news and entertainment private radio station in
France, reaching over 4 million people daily.
• A good year for musical stations abroad (revenues +6.5%),
including developments in Africa.
 TV activities
• First step of Lagardère Studios’ international development
through the acquisition of Grupo Boomerang TV, a leading
independent TV producer in Spain.
• With Gulli, TiJi and Canal J, Lagardère Active remains the first
TV offer for children in France, with a 34% market share.
 Digital
2015 Full-Year Results
9 March 2016
• Digital turnover on apps and websites registered a double digit
growth, driven by the remarkable performances of Elle, Paris Match,
Public and Télé 7 Jours.
*“One Global” = audience research on print and digital readings of press marks. It is published 4 times a year by the merger
of ONE study data and results of MNR panels and PIM Mediamétrie.
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 All legacy sports marketing agencies were integrated into
into Lagardère Sports
2015 highlights
 Successful delivery of several major competitions:
• 2015 Asian Cup in Australia;
• Orange Africa Cup of Nations 2015 in Equatorial Guinea;
• African Games in Congo-Brazzaville.
 Renewal of partnership agreement with CAF until 2028.
 Creation of a strategic partnership in China with Le Sports.
 Expansion of brand consulting activities:
• Acquisition of akzio! ajoint. in Germany and Sponsorship 360 in France.
2015 Full-Year Results
9 March 2016
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From strategy
to
implementation
3-pillar strategy
Strategic
roadmap
1
Reduce exposure
to declining
activities
2
2015 Full-Year Results
9 March 2016
Adapt existing
activities and
enhance leadership
positions
3
Invest in
higher growth
activities
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Successful disposals in 2015 and 2016
Reduce
exposure
1
to declining
activities
February 2015
Swiss Distribution
business disposal
(ex Payot Naville
Distribution)
2015 Full-Year Results
9 March 2016
2016
2015
June 2015
US Distribution
business (Curtis)
disposal
November 2015
Announcement
of Spanish
Distribution
business (SGEL)
disposal
January 2016
“Parents”
magazine
disposal
February 2016
Announcement of Belgium
Distribution business
disposal
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Lagardère Publishing
 E-book market:
Adapt existing
activities
2
and enhance
leadership
positions
• No further transition to digital in 2015;
• Implementation of the agency model (retail price controlled
by publishers) in the US and UK markets.
 Reinforcement by synergetic “boutique” acquisition
(Rising Stars, primary school text books in the UK).
Lagardère Active
 Musical radios: developments in French speaking
Africa (Ivory Coast).
 Digital:
2015 Full-Year Results
9 March 2016
• Digital revenues growth linked to French magazines websites
and apps (Paris Match, Elle, Public…): +25% in 2015.
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Improvement of the business mix
% of total consolidated sales
Adapt existing
activities
2
and enhance
leadership
positions
2015 Full-Year Results
9 March 2016
44%
40%
37%
56%
60%
63%
2012
2013
2014
27%
Distribution*
73%
Travel Retail
2015
The repositioning and development strategy of Lagardère Travel Retail
is well on track, with the advanced disposal process of the Distribution
activities and the accelerated organic growth in Travel Retail.
*Press Wholesale Distribution and Integrated Retail.
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Diversification of the revenue streams
% of total consolidated sales
Adapt existing
activities
2
and enhance
leadership
positions
2015 Full-Year Results
9 March 2016
Marketing
Rights
43%
42%
Other
activities*
17%
20%
Media
Rights
40%
48%
33%
38%
19%
2012
2013
*Stadium management, brand consulting, theatres management, live entertainment…
2014
42%
32%
26%
2015
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Creation of a strong footprint in North America
 An attractive market undergoing major redevelopments.
Invest in higher
growth
3
activities
• USA: a large and resilient market ($7.7bn).
• A significant potential for growth:
- Increasing commercial development of airports (expansion in concessions space);
- Rising spending per passenger;
- Growth in traffic forecasts (+3% from 2015 to 2021 and +2% for the following
decade).
Paradies
Lagardère Travel Retail North America
2015 Full-Year Results
9 March 2016
Overlap
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 Acquisition of 17 stores at JFK Airport (New York):
• 17 fashion and candy sales outlets spread over 1,700 m²
in Terminal T4.
Invest in higher
growth
3
activities
 Acquisition of Paradies, an airport travel retail leader in North America
operating in more than 75 airports (Canada and US airports).
 Creation of the 3rd largest player in the North American travel retail
market:
2015 Full-Year Results
9 March 2016
• An acquisition at a reasonable multiple;
• Complementary geographical footprint;
• Combination of Paradies brands and global concepts to enhance the portfolio of
brands, to better respond to airports and passenger needs;
• A deal with strong synergies (central costs, buying power, business development
opportunities).
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 Acquisition of Grupo Boomerang TV:
• Spanish audiovisual production group acquired in May 2015;
Invest in higher
growth
3
activities
• Grupo BTV is one of Spain's leading independent audiovisual production
groups (fiction and unscripted) and has launched expansions in several
Latin American countries.
2015 Full-Year Results
9 March 2016
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 2016 guidance
Guidance
&
Dividend
In 2016, the recurring EBIT of fully consolidated companies
is expected to grow slightly above 10%:
• At constant exchange rates;
• Excluding the effect of the potential disposal of Distribution activities.
 Dividend
• Ordinary dividend maintained: €1.30 per share*.
• Calendar:
- the ex-dividend date is 6 May 2016;
- the ordinary dividend will be paid as of 10 May 2016.
2015 Full-Year Results
9 March 2016
*Ordinary dividend that will be recommended at the General Shareholder’s Meeting on 3 May 2016.
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Achieved performance was within or above guidance
for 10 of the last 11 years
Group guidance
vs. Recurring
EBIT achieved
Evolution of Recurring EBIT vs. the previous year
15%
10%
5%
0%
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
-5%
-10%
-15%
2015 Full-Year Results
9 March 2016
Recurring EBIT growth achieved
March guidance
Source: Lagardère group.
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2015 Full-Year Results
Arnaud Lagardère
General and Managing Partner
9 March 2016