Presentation slides

Q4 presentation, February 9, 2012
Johan Lindgren, CEO
Mattias Lundqvist, CFO
Cecilia Lannebo, IR
Financial highlights 2011
Revenues SEK 4,323 M, an organic decline of 11%, inline with guidance
Online revenues in Directory Scandinavia increased by 1% organically
Cost reductions SEK 458 M – ahead of communicated SEK 350 M
EBITDA SEK 991 M (605)
Adjusted EBITDA SEK 1,074 M (1,266)
Cash flow SEK 230 M (151)
Interest bearing net debt SEK 3,675 M (3,951), Net debt/EBITDA 3.6 (3.3)
2
Financial highlights Q4
Revenues SEK 1,194 M, an organic decline of 16%
Online revenues in Directory Scandinavia decreased by 5% organically
Cost reductions SEK 149 M – ahead of plan
EBITDA SEK 319 M (409)
Adjusted EBITDA SEK 338 M (451)
Cash flow SEK 307 M (-162), +469 MSEK
Interest bearing net debt SEK 3,675 M (3,951), Net debt/EBITDA 3.6 (3.3)
3
Activities in the period
Corporate
Acquisition of parts of the Gule Sider in Denmark
Acquisition of the Swedish DA service company 118 800
Strategic co-operation agreement signed between Eniro and Google
Product
Launch of vertical apps
Product search in all markets
Print re-scooping
Strengthened position within the strong growing mobile segment
Build-up of sales force within Mediaproducts
4
DGS.dk is the 10th largest Danish site in terms of usage
while Krak.dk is number two in FDIM’s ranking
Users
1 dr.dk
1 834 931
2 krak.dk
1 776 698
3 ekstrabladet.dk 1 545 275
4 tv2.dk
1 538 831
5 windowslive.dk 1 464 194
6 msn.dk
1 213 072
7 dba.dk
1 132 807
8 bt.dk
1 127 498
9 dmi.dk
897 738
10 degulesider.dk
884 476
• Purchase consideration SEK 27M
• Estimated turnover for FY 2011 according to seller DKK 240 M, of which 40% print.
Eniro will purely focus on online going forward
• Low prepaid level entering 2012
• To contribute to EBITDA during 2012
5
Pros and cons in the Q4 report
Pros
Cons
Group EBITDA
Organic development
Cash-flow and working capital
Development of online
Cost savings higher
Development of prepaid revenue
Net debt lowered
Poland
Reiteration of guidance for 2012
Conditions in bank agreements fulfilled
Additional repayment of SEK 150 M in Q1
Sequential development of prepaid
Purchase of assets in De Gule Sider
Letter of intent to purchase118 800
Co-operation with Google on splinks
6
The turnaround plan
2010
2011
2012
Organic revenue decline
less than 15%
Organic revenue decline
close to 10 percent
Returning to revenue
growth
Total cost base reduction
of approx SEK 350 M vs.
total costs 20091
Total cost base reduction of
approx SEK 350 M vs. total
costs 20101
EBITDA 2012 inline with
outcome 2011
Actuals in line with
guidance
Actual top-line in line with
guidance
Total cost base reduction of
approx SEK 200 M vs. total
costs 20112
Cost reductions ahead of
guidance, 458 MSEK
1) Assuming unchanged currencies and for comparable units
2) The planned cost savings do not include effects from divestments and acquisition of operations, or the higher third-party
costs that arose as a result of the strategic shift in the revenue mix to higher revenues from third-party partnerships.
7
Revenue bridge by business unit Q4
1 482
-16%
48
13
8
1 414
143
1
Reported Divested Currency Moved
Organic Directory
revenues business effects publications baseline Scandinavia
2010
2010
-14%
75
1 194
Voice
Poland
0%
-44%
Reported
revenues
2011
Revenue effect from divested operations, currency and moved publications, totaled SEK 69 M
Revenues decreased by 16% organically
Revenues from Online 61% as a share of total Directory Database Services revenues
Voice down +-0% organically, margin up to 45% due to price increase and high efficiency
Poland down 44% organically, revenues from online increased 64%
8
Revenue bridge by segment Q4
1 482
48
-16%
13
8
1 414
24
104
2
18
1
75
1 194
Reported Divested Currency Moved
Organic
effects
revenues business
publications baseline
2010
2010
Online
-5%
Print
Media
-25%
-14%
5%
Other
Voice
Poland
0%
-44%
-28%
Reported
revenue
2011
Revenues from Online down 5% organically
Revenues from Print down 25% organically
Media products up 5% organically, mainly due to increasing sales from sponsored links
9
Cost reductions 2012 ahead of guidance
4 208
324
324
-458
96
3 787
126
126
81
101
102
150
149
Operating Divested Currency Organic
Net
cost 2010 operations effect
baseline Savings
2010
Q1
Net
Savings
Q2
Net
Savings
Q3
3 329
Net
Operating
Savings cost 2011
Q4
YTD
Total savings SEK 458 M in 2011, including extra pension cost of SEK 36 M in Q2
Of which Staff SEK 166 M, Print and Paper SEK 104 M, Consultants SEK 69 M
893 MSEK in cost savings during the last two years
10
Revenue/EBITDA overview
Operating Revenues
SEK M
2011
2010
2011
2010
Oct-Dec
Oct-Dec
Jan-Dec
Jan-Dec
Directories Scandinavia
873
1 033
3 190
3 713
Voice
223
225
899
968
Poland
98
190
234
365
-
34
-
280
1 194
1 482
4 323
5 326
Finland Directories
Total
EBITDA
SEK M
2011
2010
2011
2010
Oct-Dec
Oct-Dec
Jan-Dec
Jan-Dec
Directories Scandinavia
206
288
750
941
Voice
100
70
340
340
Poland
28
77
-16
45
-
-5
-
-609
Other
-15
-21
-83
-112
Total EBITDA
319
409
991
605
-15
-22
-43
-80
-4
-20
-40
-581
Total adjusted EBITDA
338
451
1 074
1 266
EBITDA margin, %
28,3
30,4
24,8
23,8
Finland Directories
of which items affecting comparability
Restructuring cost
Other items affecting comparability
11
Prepaid revenues in the balance sheet
1 400
1 200
1 102
1 000
1 047
1 037
1 054
956
954
1 054
994
940
937
865
800
600
Prepaid revenues up 9% compared with Q3
12
Change in net debt
Analysis of interest bearing net debt
------- 3 m onths --------
------- 12m onths -------
2011
Oct-Dec
2010
Oct-Dec
2011
Jan-Dec
2010
Jan-Dec
Opening balance
Operating cash flow
Acquisitions and divestments
Share issue
Translation difference and other changes
-4 000
307
-27
-1
46
-6 138
-162
-11
2 389
-29
-3 951
230
-10
56
-6 645
151
26
2 389
128
Closing balance
Net debt /EBITDA adjusted for other
items affecting comparability, times
-3 675
-3 951
-3 675
-3 951
3,6
3,3
3,6
3,3
SEK M
Operating cash flow in Q4 increased by 469 MSEK
Operating cash flow for the full year affected by payment of extra tax of
SEK 101 in Q1 and payment of pension premiums of SEK 70 M in Q2
Net debt/EBITDA 3.6 (3.3) y-o-y and sequentially
13
Re-payments of SEK 650 M in 2012
Extra re-payment of approx. SEK 150 M in Q1 2012
Re-payments according to bank agreement:
SEK 150 M in re-payment due in June 2012
Approx. SEK 200 M in re-payment of interest swaps due in August
SEK 150 M in re-payment due in December 2012
Re-payments will primarily be funded by operating cash flow.
Healthy liquidity will be maintained.
14
Yellow usage – eniro.se
Weekly sessions, monthly average
1 600 000
1 400 000
User sessions
1 200 000
1 261 732
1 000 000
800 000
600 000
400 000
200 000
2011
2010
0
15
Yellow usage – gulesider.no
Weekly sessions, monthly average
1 600 000
User sessions
1 400 000
1 200 000
1 000 000
955 211
800 000
600 000
400 000
200 000
2011
2010
0
16
Yellow usage – Krak Denmark
Weekly sessions, monthly average
800 000
657 028
700 000
User sessions
600 000
500 000
400 000
300 000
200 000
100 000
2011
2010
0
17
Challenges and tactical plan
Focus areas
Market position
Meaning
With the customer in focus, we
develop our services and make
our advertisers searchable 24/7
Main initiatives
2012
• Updated brand platform
• Desirable product portfolio
• Leading in mobile
• Attractive employer
Quality
Stability, relevance and simplicity
in all that we do
• Content program
• Quality in focus
• Web analytics
• Improved customer experience
• Culture program
Profitable growth
Eniro grows with focus on both
revenues and costs
• Priority of existing customers
• Sales channel optimization
• Cost optimization
18
Media market development in Sweden
• IRM forecasts adjusted
• Increased macro uncertainty
• Growth within online/internet media continues to outperform market average
• Eniro within the mass market segment for small- medium sized companies
%
15
12,1
10
10
8,4
7,8
6,2
5,6
4,8
5
1,5
0,3
0,3
-5,8
2012E
2010
2009
2008
2007
2006
2005
2004
2003
2011E
-5
2002
2001
2000
0
-3,8
-10
-15 Source: IRM
-12,5
19
Eniro is moving towards the growth segments –
forecasted media market growth for 2012
• 75-80% of Eniro revenues are within Online
• Largest Nordic player within the growing mobile segment
• Only some 10-15% of revenues in the profitable but declining print segment
%
80
66,4
60
Eniro market offering is changing
40
Average media advertising
growth for 2012
0,3%
17,7
20
7,8
3,1
0,4
0
Mobile
Search
words
Internet
Display
Online print Printed
catalogues catalogues
-20
-40 Source: IRM
-32,9
20
Share of Average Time spent per day vs.
Ad Spending share
42,5
42,2
TV
25,9
21,9
Internet*
14,6
10,9
10,1
Radio
Mobile
0,9
4
Newspapers
15
2,8
Magazines
0
9,7
10
Time spent share
20
30
40
50
%
Ad spending share
*Time spent with internet excludes internet access via mobile, but online ad spending includes mobile
internet ad spending, due to this the total ad spending shares adds up to more than 100%
Source: eMarketer, December 2011
21
Outlook for 2012
Revenues
Organic revenue growth in 2012
EBITDA
EBITDA for 2012 in line with 2011
Cost reductions
Net cost reductions1 of SEK 200 M in 2012
Dividend and capital structure
Priority will be given to the reduction of net debt
1) The planned cost savings do not include effects from divestments and acquisition of operations, or the higher third-party
costs that arose as a result of the strategic shift in the revenue mix to higher revenues from third-party partnerships.
22