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Vivendi — Investor Presentation (May 2011)
50 slides from Vivendi's investor presentation, May 2011
Slide 1: Investor Presentation May 2011
Investor Presentation May 2011 IMPORTANT NOTICE: Financial statements unaudited and prepared under IFRS Investors are strongly urged to read the important disclaimer at the end of this presentation
Slide 2: Vivendi now has exclusive control of its businesses
Vi di now hhas exclusive Vivendi l i control t l off itits bbusinesses i 62%* 100% 100%** #1 worldwide in video games #1 worldwide in music #1 alternative telecoms in France 53%* 100% 100%/80% #1 in telecoms #1 alternative broadband operator #1 in pay-TV in France in Morocco in Brazil * Based on sha
Slide 3: Vivendi is focused on organic growth and return to shareholders
Vi di is Vivendi i focused f d on organic i growth th andd return t to t shareholders h h ld Our ambition: Enhance the growth potential and profitability of our subscription-based model by innovating and investing in attractive content, platforms and networks We promote internal innovation initiativ
Slide 4: Innovation to accelerate organic growth
Innovation to accelerate organic growth In order to strengthen the innovation dynamics, Innovation is at the we aim to: heart of our development strategy Launch new, ambitious, growth projects Foster cooperation between the group’s businesses The launch of innovative products and services, ¾ Increas
Slide 5: 2010 business drivers: Commercial success in France
2010 business drivers: Commercial success in France Excellent market share and revenue achievements for businesses in France Canal+ France subscriptions p ARPU pper subscriber Mobile data revenues Broadband B db d Internet I t t in Mainland France 11,058 k mass market revenues + 335 k €46.3 + 16% €2
Slide 6: 2010 business drivers: More emerging markets
2010 business drivers: More emerging markets Vivendi has increased its exposure to fast-growing economies 2009 Revenues in emerging markets 2010 Revenues in emerging markets 14% 18% + 35% Accelerated growth of GVT in Brazil: Revenues up 71% in euros* Activision Blizzard, Maroc Telecom Group, UMG
Slide 7: 2010 business drivers: More digital
2010 business b siness dri drivers: ers More digital O r content operations contin Our continuee to benefit from new digital business models 2009 digital revenues* 2010 digital revenues* Digital recorded music revenues up 14% 27% 32% Î Digital sales in excess of €1bn in 2010, totaling 29% of recor
Slide 8: In 2010 and early 2011, we addressed issues from the past
In 2010 and early earl 2011, 2011 wee addressed iss issues es from the past End of the dispute regarding PTC shares: Vivendi received €1,254m in January 2011 ¾ Following agreement entered into in December 2010 with Deutsche Telekom, Mr. Solorz-Zak (the controlling shareholder of Elektrim) and the cr
Slide 9: Acquisition of Vodafone's 44% stake in SFR
A i iti off Vodafone’s Acquisition V d f ’ 44% stake t k iin SFR The acquisition is in line with our strategy to own 100% of our France-based operations transaction* values 44% of SFR at €7,950 The transaction €7 950 million ¾ €7,750 million, corresponding to a 6.2 multiple of SFR’s 2010 EBITDA ¾ a
Slide 10: The positives of this acquisition
Th positives The iti off thi this acquisition i iti Highly accretive on earnings Enabling a dividend increase as early as 2012 educt o in co Reduction g o e ate ddiscount conglomerate scou t Better financial flexibility within BBB rating New opportunities in running Vivendi and SFR operations Confid
Slide 11: A highly accretive acquisition
A highly hi hl accretive i acquisition i ii The transaction will have a +15% to +18% impact on Vivendi’s Adjusted Net Income in 2011, 2011 assuming assuming… ¾ 6 months of incremental operating contribution… ¾ … and 12 months of accelerated use of net operating losses We forecast incremental contrib
Slide 12: First quarter 2011 results are in line with expectations
First quarter 2011 results are in line with expectations Q1 2011 operating results are in line with expectations: ¾ Revenues: €7,184m + 3.8% ¾ EBITA: €1,705m + 7.2% Adjusted Net Income is up 29% to €950m due to EBITA growth and includes the following items: ¾ Q1 2011 impact of full year SFR integrat
Slide 13: Confirmed 2011 guidance for all our businesses
Confirmed 2011 guidance for all our businesses Further improvement in EBITA margin; 2011 EBITA close to 2010 Double digit EBITA margin, despite restructuring charges Mobile: Decrease in EBITDA in a tough competitive, tax and regulatory environment Broadband & Fixed: Increase in EBITDA, excl. 2010 fa
Slide 14: Guidance for 2011
Guidance for 2011 We reiterate our guidance of slight increase in Vivendi’s Adjusted Net Income excluding NBCU*, and before the impact of the SFR 44% stake acquisition We are adding 2011 full year guidance at Vivendi level reflecting the acquisition of the 44% stake in SFR**: ¾ Adjusted Net Income a
Slide 15: Conclusion
Conclusion Vivendi has full control of its assets and is poised for more profitable growth, despite a challenging environment Vivendi’s organic development in fast-growing economies as well as its focus on internal innovation will enhance the long term performance of its businesses Vivendi is determ
Slide 16: Slide 16
Slide 17: GVT Strategy and Outlook
vivendi GVT Strategy and Outlook
Slide 18: Market overview and strategy: Telecom segment
Market overview and strategy: Telecom segment GVT is a provider of fixed Communications & Entertainment for upscale Brazilian Households and Businesses in key markets1 Telecoms segment overview Fixed broadband market expected to reach 34m subscribers in 5 years from 13m currently2, CAGR 21% Fixed te
Slide 19: Market overview and strategy: Pay TV segment
Market overview and strategy: Pay TV segment Pay TV segment overview Pa TV market is eexpected Pay pected to nearl nearly do double ble its size si e in the next ne t 5 years, ears reaching 18 million subscribers s bscribers1 Pay TV penetration2 in Brazil is 13%, growing to 29% in the next 5 years (
Slide 20: Economic and market environment
Economic and market environment Stable macroeconomic environment Brazil’s GDP expected to be the world’s 5th largest in 5 years1. Per capita GDP in 2010 expected at ~USD10k from USD6k in 20062 In the next 5 years, ABC social classes households’ share of total number of households expected to increas
Slide 21: GVT mid-term and 2011 guidance
GVT mid-term mid term and 2011 guidance Mid-term financial outlook for Telecoms* Fixed & broadband: 2014 revenues expected to exceed 2.5x 2010 revenues reaching more than BRL6bn, with above 40% EBITDA margin Free cash flow (EBITDA – CapEx) expected to break even in 2012 and be positive in 2013 Mid-t
Slide 22: First quarter 2011 Results
vivendi First quarter 2011 Results
Slide 23: Solid increase in EBITA
Solid increase in EBITA In euro millions - IFRS Constant Q1 2011 Q1 2010 Change currency Activision Blizzard 502 377 + 33.2% + 31.3% Universal Music Group 46 68 - 32.4% - 35.1% SFR 566 634 - 10.7% 10 7% - 10.7% 10 7% Maroc Telecom Group 266 284 - 6.3% - 7.0% GVT 90 43 x 2.1 + 89.3% Canal+ Group 265*
Slide 24: Adjusted Net Income
Adjusted Net Income In euro millions - IFRS Q1 2011 Q1 2010 Change % Revenues 7,184 6,924 + 260 + 3.8% Disposal of NBC Universal EBITA 1,705 1,590 + 115 + 7.2% Income from equity affiliates (2) 15 - 17 Incl. contractual dividends received from f G at closing GE of the NBCU transaction Interest (101)
Slide 25: Reconciliation of Adjusted Net Income to Net Income, group share
Reconciliation of Adjusted Net Income to Net Income, group share In euro millions - IFRS Q1 2011 Q1 2010 Adjusted Net Income 950 736 Amortization of intangible assets acquired through business combinations (123) (134) Other financial charges and income 808 (69) - o/w settlement of the litigation reg
Slide 26: Financial net debt evolution
In euro billions- IFRS Financial net debt evolution Dividends Net financial December 31, CFFO Interest & tax paid to SFR investments and March 31, 2010 after Capex paid and other minority other 2011 (4.4) (8.1) + 0.9 (0.5) (0.4) + 3.7 Including: Including: Including: Contractual dividends from GE at
Slide 27: Activision Blizzard: Revenues €1,061m, EBITA €502m
Revenues: €1,061m, +12% Record results driven by strength of digital sales ¾ Revenues from digital channels grew 30% and account for 30% In euro millions Constant Q1 2011 Q1 2010 Change IFRS currency of total revenues ¾ Strong performance from Call of Duty franchise; continued Revenues 1,061 945 + 1
Slide 28: Universal Music Group: Revenues €881m, EBITA €46m
Revenues: €881m, -0.9% Recorded music down 2.7% due to lack of major releases and In euro millions - IFRS Constant unfavorable basis of comparison (Lady Gaga’s The Fame Monster Q1 2011 Q1 2010 Change currency and The Black Eyed Peas’s The E.N.D. in Q1 2010) Revenues 881 889 - 0.9% - 5.0% ¾ Best sell
Slide 29: SFR: Revenues and EBITDA
Mobile service revenues: €2,004m, +3.5% excl. VAT and regulatory impact* In euro millions - IFRS +94k postpaid customers in Q1 in a volatile market due to January Q1 2011 Q1 2010 Change and February VAT turbulence Revenues 3,056 3,085 - 0.9% Data revenues: +25% to €688m due to growing smartphone Mob
Slide 30: Maroc Telecom Group: Revenues €672m, EBITA €266m
Revenues: €672m, +1.8% Mobile in Morocco ¾ Growing customer base (+7% yoy), o/w +24% for postpaid In euro millions - IFRS Constant Q1 2011 Q1 2010 Change customers due to new offering launched in Q4 2010 and currency Revenues 672 660 + 1.8% + 1.5% Universal Music package, Maroc Telecom SA 549 541 +
Slide 31: GVT: Revenues €329m, EBITDA €138m
Revenues: €329m, +63%* (+47%* at constant currency) Growth driven by territorial and coverage expansion, higher In euro millions - IFRS Constant Q1 2011 Q1 2010* Change Ch proportion of bundle with data and lower churn Currency Revenues 329 202 + 62.9% + 46.8% Broadband service revenues up 104% and
Slide 32: Canal+ Group: Revenues €1,192m, EBITA €265m
Revenues: €1,192m, +4.1% Canal+ France revenue growth sustained by: In euro millions - IFRS Constant Q1 2011 Q1 2010 Ch Change ¾ Portfolio growth at Canal+ France: 214k net adds year-on-year currency ¾ Growing ARPU per subscriber in Mainland France to €47.1 (+€1.4 Revenues 1,192 1,145 + 4.1% + 3.9%
Slide 33: Investor Presentation – May 2011
Investor Presentation – May 2011
Slide 34: Appendices
vivendi Appendices
Slide 35: Activision Blizzard Non-GAAP and 2011 Financial Outlook
Non-GAAP* IFRS In dollar millions Q1 2011 Q1 2010 Change Constant Q1 2011 In euro millions currency Activision 323 337 - 4.2% Activision 671 -0.7% Blizzard 357 306 + 16.7% 16 7% Blizzard 335 +46.1% Distribution 75 71 + 5.6% Distribution 55 +4.9% Net revenues 755 714 + 5.7% Net Revenues 1,061 10.8% A
Slide 36: Activision Blizzard – Reconciliation to IFRS Revenues
Activision Blizzard – Reconciliation to IFRS Revenues Q1 2011 In millions Non-GAAP Net Revenues $755 Changes in deferred net revenues (a) $694 Net Revenues in US GAAP as published by Activision Blizzard $1,449 Reconciling differences between US GAAP and IFRS - Net Revenues in IFRS (in millions of do
Slide 37: Activision Blizzard – Reconciliation to IFRS EBITA
Activision Blizzard – Reconciliation to IFRS EBITA Q1 2011 In millions Non-GAAP Operating Income/(Loss) $218 Changes in deferred net revenues and related cost of sales (a) $506 Equity-based compensation expense (b) $(23) Restructuring charges $(19) Amortization of intangibles acquired through busine
Slide 38: UMG top-selling artists and 2011 upcoming releases
Top-selling artists Million Million Q1 2011 units* it * Q1 2010 units* it * Justin Bieber 1.3 Lady Gaga 2.9 Rihanna 1.1 Black Eyed Peas 1.4 Les Enfoirés 0.6 Justin Bieber 1.2 Eminem 0.5 Florence & The Machine 0.5 Jessie J 0.4 Taylor Swift 0.5 Top 5 Artists ~3.9 Top 5 Artists ~6.5 Constant In euro mi
Slide 39: SFR mobile, broadband internet and fixed KPIs
Q1 2011 Q1 2010 Change MOBILE Customers ((in '000)* ) 21,039 , 20,364 , + 3.3% Proportion of postpaid clients* 75.6% 73.8% + 1.8 pt 3G customers (in '000)* 10,444 8,512 + 22.7% Market share on customer base (%)* 32.1% 33.1% - 1,0 pt Network market share (%) 34.6% 34.8% - 0.2 pt 12-month rolling blen
Slide 40: SFR – Detailed revenues
SFR – Detailed revenues IFRS - in euro millions Q1 2011 Q1 2010 Change Service revenues 2,004 2,079 - 3.6% of which data revenues from mobile services 688 551 + 24.9% E i Equipment t sales, l nett 128 106 + 20 20.8% 8% Mobile revenues 2,132 2,185 - 2.4% Broadband Internet and fixed revenues 988 981
Slide 41: Maroc Telecom SA and African subsidiaries
Maroc Telecom SA African subsidiaries In '000 (except where noted) Q1 2011 Q1 2010 In '000 Mar. 31, 2011 Mar. 31, 2010 Mauritania Number of mobile customers 16,655 15,578 Number of mobile customers 1,696 1,473 % Prepaid P id customers t 94 7% 94.7% 95 5% 95.5% Number of fixed lines 40 43 ARPU (€/mon
Slide 42: GVT operating data
In '000 Q1 2011 Q1 2010 * Change In BRL millions Q1 2011 Q1 2010** Change Total Homes passed 5,699 3,825 + 49.0% Total Net Revenues 747 509 + 46.8% Total Lines in Services (LIS) 4,765 3,118 + 52.8% Voice 462 341 + 35.5% Next Generation Services 285 168 + 69.6% Retail and SME 3,345 2,269 + 47.4% Corp
Slide 43: Canal+ Group subscriber portfolio
(in ‘000) March 31, 2011 March 31, 2010 Change Portfolio Canal+ Group 12,525 12,273 + 252 ow Canal+ France* 10,886 10,672*** + 214 ow International** 1,639 1,601 + 38 * Individual and collective subscriptions at Canal+, CanalSat in metropolitan France, overseas territories and Africa. ** Poland, Vie
Slide 44: Revenues
Revenues In euro millions - IFRS Constant Q1 2011 Q1 2010 g Change c rrenc currency Activision Blizzard 1,061 945 + 12.3% + 10.8% Universal Music Group 881 889 - 0.9% - 5.0% SFR 3,056 3,085 - 0.9% 0 9% - 0.9% 0 9% Maroc Telecom Group 672 660 + 1.8% + 1.5% GVT 329 214 + 53.7% + 38.6% Canal+ Group 1 1
Slide 45: Interest
Interest In euro millions – IFRS (except where noted) Q1 2011 Q1 2010 Interest (101) (118) Interest expense p on borrowings g ( ) (113) ( ) (128) Average interest rate on borrowings (%) 4.17% 4.09% Average outstanding borrowings (in euro billions) 10.8 12.5 Interet income from cash and cash equivale
Slide 46: Income tax
Income tax In euro millions – IFRS Q1 2011 Q1 2010 Adjusted Net Adjusted Net net income income net income income Consolidated Global Profit Tax System 190 246 126 146 Current tax: savings for current year 190 190 126 126 Deferred tax: variation in expected savings (year n+1 / year n) - 56 - 20 Tax c
Slide 47: Glossary
Gl Glossary Adjusted earnings before interest and income taxes (EBITA): EBIT (defined as the difference between charges and income that do not result from financial activities, equity affiliates, discontinued operations and tax) before the amortization of i t ibl assets intangible t acquired i d thr
Slide 48: Activision Blizzard – stand alone definition & disclaimer
A ti i i Bli Activision Blizzardd – stand t d alone l ddefinition fi iti & disclaimer di l i Non-GAAP Financial Measures Activision Blizzard provides net revenues, revenues net income (loss) (loss), earnings (loss) per share and operating margin data and guidance both including (in accordance with G
Slide 49: Investor Relations team
I Investor R l i Relations team Jean Michel Bonamy Jean-Michel Executive Vice President Investor Relations +33.1.71.71.12.04 [email protected] Paris 42, Avenue de Friedland New York 75380 Paris cedex 08 / France 800 Third Avenue Phone: +33.1.71.71.32.80 New York, NY 10022 / USA Fax: +33
Slide 50: Important legal disclaimers
I Important t t legal l l disclaimers di l i Forward Lookingg Statements This presentation contains forward-looking statements with respect to Vivendi’s financial condition, results of operations, business, strategy, plans and outlook of Vivendi, including expectations regarding the payment of divid