Videndum Plc · LSE:VID
Videndum — H1 2023 Earnings Presentation
37 slides from Videndum's earnings presentation, Sep 26, 2023
Slide 1: Half Year Results 2023
Enabling the capture and sharing of exceptional content. Half Year Results 2023 26 September 2023 Capture. Share.
Slide 2: Agenda
Agenda 1. Half Year 2023 Summary ▪ Stephen Bird, Group Chief Executive 2. Current Trading, Outlook and Strategic Positioning ▪ Stephen Bird, Group Chief Executive 3. Market and Strategy Update ▪ Stephen Bird, Group Chief Executive 4. Financial Review ▪ Andrea Rigamonti, Group Chief Financial Officer
Slide 3: Half year 2023 financial summary
Half year 2023 financial summary ▪ As previously highlighted, H1 2023 financial performance significantly impacted by US writers’ strike, ongoing macroeconomic headwinds and effects of destocking ▪ Revenue from continuing operations down 25% year-on-year ▪ Executed self-help actions to improve cost
Slide 4: Current trading and outlook
Current trading and outlook ▪ The Group is experiencing significantly more impact from the strikes in H2 2023 than anticipated at the time of its May Update. This is due to: 1. Prolonged writers’ strike 2. Additional impact of the actors’ strike: geographically and on more customer segments 3. Delay
Slide 5: Strategic positioning
Strategic positioning ▪ The Group has put additional mitigation plans in place to further reduce costs and conserve cash ▪ Proactively working to reduce leverage and recapitalise the business, which may require an equity raise ▪ The Group has strong relationships with its lending banks ▪ Agreed furt
Slide 6: Market & strategy update
Market & strategy update 6 | Videndum plc
Slide 7: Content creation market continues to have strong medium-term prospects
Content creation market continues to have strong medium-term prospects 1. Structural market growth drivers remain attractive ▪ Expect significant recovery; timing uncertain 2. Technology advancement driving shorter replacement cycles ▪ Maintaining investment in key strategic initiatives ▪ Strong vit
Slide 8: Group strategic priorities unchanged
Group strategic priorities unchanged 1 2 3 Organic growth Margin improvement Growth through M&A ▪ Strategic priorities unchanged; however, focusing more tightly on our core markets, particularly the high-end professional and B2B segments – where we see the greatest growth potential – and exiting non
Slide 9: Creative Solutions
Creative Solutions ▪ Market drivers intact: driven by streaming and demand for original content; short-term impact of strikes ▪ Strategy: focused on continuing to deliver 4K/HDR replacement cycle, as well as developing innovative new technology for monitoring, collaboration and streaming in high-end
Slide 10: Media Solutions
Media Solutions ▪ Market drivers intact; driven by mid-term increase in professional content creation, audio capture, retail commerce and vlogging; short-term impact of macroeconomic environment affecting business confidence ▪ Strategy focused on developing innovative new products to improve custome
Slide 11: Production Solutions
Production Solutions ▪ Market drivers intact: driven by demand for automated production, on-location news and original content; short-term impact of strikes ▪ Strategy: focused on developing innovative new technologies to accelerate product replacement cycles in TV studios, on-location news and spor
Slide 12: Financial review
Financial review 12 | Videndum plc
Slide 13: Half year 2023 results
Half year 2023 results Continuing Operations H1 23 H1 22 % change £m £m ▪ Revenue 28% behind H1 2022 on a Revenue 165.0 219.4 -25% constant currency basis Gross profit* 69.0 95.8 -30% ▪ Price more than offset inflation Gross margin %* 41.8% 43.7% -1.9%pts Operating expenses* (53.8) (63.7) -16% ▪ Gro
Slide 14: Revenue bridge
Revenue* bridge H1 Writers’ 2022 strike Destocking ▪ Writers’ strike from May but purchasing Consumer slowed from March & ICC Other H1 volume Price FX 2023 ▪ Destocking effect seen through H1 2023 ▪ Consumer demand continues to be soft and ICCs deferring purchases ▪ Other volume includes the non-rep
Slide 15: Operating profit bridge
Operating profit* bridge H1 Writers’ 2022 strike ▪ c.50% marginal contribution impact from lower volumes ▪ Price more than offset inflation, with raw Destocking materials inflation plateauing H1 Consumer Net cost FX 2023 ▪ Net cost savings including control of savings & ICC discretionary spend, and
Slide 16: Divisional performance
Divisional performance Revenue Operating profit* H1 23 H1 22 % change H1 23 H1 22 % change £m £m £m £m Media Solutions 82.3 111.5 -26% 9.5 18.8 -49% Production Solutions 51.7 67.5 -23% 7.3 15.0 -51% Creative Solutions 31.0 40.4 -23% 3.7 7.0 -47% Corporate Costs - - - (5.3) (8.7) -39% Continuing Oper
Slide 17: Net debt bridge
Net debt bridge Other Jun 23 Net lease items1 Net debt Free cash Dividends additions ▪ Net debt rose by £22.6m Dec 22 Net debt flow* FX ▪ Free cash outflow* but working capital 15.2 Operating profit* increase* limited to £4.4m 10.5 Depreciation ▪ Net lease additions primarily relates to the (4.4) In
Slide 18: Mitigating actions and efficiencies
Mitigating actions and efficiencies ▪ The Group is actively managing the business to cut costs and to preserve cash while seeking to ensure we are well placed to take advantage of the recovery once the strikes are over and productions restart ▪ In H1 we implemented short term cost restrictions, and
Slide 19: Summary
om | = Videndum jt a | Summary 19 =| Videndum pic
Slide 20: Summary
Summary ▪ H1 2023 performance significantly impacted by writers’ strike and macroeconomic headwinds ▪ Significantly more impact in H2 2023 than anticipated from ongoing strikes, as well as continuing challenging macroeconomic environment ▪ Additional mitigation plans in place to further reduce costs
Slide 21: Q&A
Q&A Dialling in from the UK: 0800 358 1035 Scan the QR code to dial in from all other locations Access code: 048938 Press *1 to ask a question Press *2 to withdraw your question Press *0 for operator assistance 21 | Videndum plc
Slide 22: Appendices
om | = Videndum jt a | Appendices 22 =| Videndum pic
Slide 23: Update on Strategic Review of options for Creative Solutions
Update on Strategic Review of options for Creative Solutions ▪ Most long-term shareholder value retaining the Division but focusing more tightly on its high-end professional content creation market ▪ High market share, sales channel expertise and compelling growth opportunities ▪ Board decided to ex
Slide 24: Responsibility framework & our sustainability journey
Responsibility framework & our sustainability journey 2023 • Improved Scope 3 data capture system for Category 1 and improved the quality of data for Category 4 and 9 • Included additional suppliers in climate scenario analysis Key focus areas • Continue to convert to LED lights across the Group wit
Slide 25: FX sensitivities
FX sensitivities Currency Current spot H1 23 H1 22 rates average average (22 Sep 23) rates rates USD 1.23 1.23 1.31 EUR 1.15 1.14 1.19 YEN 182 166 159 > The expected year-on-year impact on H2 2023 PBT* at current spot rates would be a headwind of c.£2m > The expected further impact from Currency Mov
Slide 26: Cash generation
Cash generation Continuing Operations H1 23 H1 22 Variance £m £m Operating profit* 15.2 32.1 (16.9) Depreciation(1) 10.5 9.9 0.6 (1) Includes depreciation, amortisation of software and capitalised development costs (Inc)/dec in inventory* (1.1) (12.3) 11.2 Dec/(inc) in receivables 12.2 (1.6) 13.8 (D
Slide 27: Loan covenants
Loan covenants Jun-23 Jun-23 Leverage calculation Interest cover calculation £m £m Reported Net Debt 216.1 Covenant EBITDA 74.6 Add discontinued ops lease liabilities 0.5 Depreciation of PP&E (14.7) Remove upfront loan fee 1.1 Covenant EBITA 59.9 Covenant Net Debt 217.7 Reported 12-month net finance
Slide 28: Five-year summary
Five-year summary 70 15% FY18 FY19 FY20 FY21 FY22 60 Revenue (£m) 385.4 376.1 290.5 394.3 442.5 50 10% Operating profit* (£m) 53.5 52.4 9.9 46.2 64.2 40 Operating margin* 13.9% 13.9% 3.4% 11.7% 14.5% 30 Operating cash flow* (£m) 44.7 44.5 25.4 49.7 57.2 5% 20 10 0% FY 18 FY 19 FY 20 FY 21 FY 22 H1 2
Slide 29: Where we operate
Where we operate Manufacturing sites R&D sites ▪ Sites in 11 countries; sell into 100+ countries Procurement centre Distribution sites ▪ World-class manufacturing facilities in UK, Italy, Costa Rica, US ▪ R&D centres in UK, Italy, US, Israel, New Zealand US Germany Japan ▪ Far East Procurement Centr
Slide 30: Who we are and what we do
Who we are and what we do Leading positions in defensible market niches Manual cine/broadcast Supports On Set Wireless Prompters Protective Solutions 6x 13x 4x 5x 55% 37% 27% 85% Photographic Tripods Batteries LED Lights Key 5x 1.4x 4.4x Videndum market share 36% Competition market share 21% 9% 30 |
Slide 31: Our structure
Our structure Videndum plc is organised in three Divisions: ▪ Media Solutions ▪ Production Solutions ▪ Creative Solutions 2022 Financial highlights Headquarters in the UK Revenue Number of employees £451.2m 1,700 (2021: £394.3m) Group 2022 revenue split 21% Adjusted operating profit* Number of count
Slide 32: Media Solutions Products
Media Solutions Products* for Professional Photography/Videography, Influencer/Vlogger and Cine/Scripted TV Photo & video Lighting Smartphonography Audio capture Motion control & Carrying solutions supports & vlogging stabilisers Manfrotto Manfrotto JOBY Rycote Manfrotto Lowepro Fast Twin Carbon Tri
Slide 33: Production Solutions Products
Production Solutions Products* for Broadcast and Cine/Scripted TV Studio pedestals Tripods & Fluid Heads Prompters Mobile Power Vinten Sachtler OConnor Sachtler/Vinten Autoscript Autocue Anton/Bauer Salt-E Dog Osprey pedestal Range Vario Ped Ultimate 1040 flowtech system flowtech Tripod aktiv fluid
Slide 34: Creative Solutions Products
Creative Solutions Products* for Cine/Scripted TV and Live Streaming Enterprises Cine Live Streaming SmallHD Monitors Teradek Wireless Wooden Camera Live Wireless Broadcast IP Video Connectivity Cine 13, OLED 22, Cine 7 + RX Module, RT CTRL.3 Controller, Bolt 6 Accessories Ranger Mk II, Ranger Micro
Slide 35: Product portfolio
Product portfolio Audio capture Distribution, rental Mobile power Smartphonography Audix & services Anton/Bauer JOBY JOBY Camera Corps Rycote The Camera Store Monitors Supports & Stabilisers SmallHD Avenger Backgrounds IP Video Gitzo Colorama Teradek Prompters JOBY Savage Autocue Manfrotto Superior
Slide 36: Important notice
Important notice Forward-looking statements This presentation contains forward-looking statements with respect to the financial condition, performance, position, strategy, results and plans of Videndum plc (the “Group”, “Videndum”, or the “Company”) based on Management’s current expectations or beli
Slide 37: Thank you
Thank you Videndum plc Bridge House, Heron Square, Richmond, TW9 1EN United Kingdom T +44 (0)20 8332 4600 [email protected] videndum.com Capture. Share.