Vivendi Se · EURONEXT:VIV
Vivendi — FY2015 Earnings Presentation
47 slides from Vivendi's earnings presentation, Feb 18, 2016
Slide 1: Full Year 2015 Results
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 Feb. 18, 2016 FULL YEAR 2015 RESULTS IMPORTANT NOTICE: Financial results for the fiscal year ended December 31, 2015 Financial statements audited and prepared under IFRS Investors are strongly urged to read the important disclaimer at the end
Slide 2: 2015 Highlights / Strategic Update
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 ARNAUD DE PUYFONTAINE Chairman of the Management Board Chief Executive Officer 2015 HIGHLIGHTS STRATEGIC UPDATE 2
Slide 3: Highlights
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 HIGHLIGHTS ■ 2015 Financial outlook met With strong increase in both UMG’s streaming and subscription services and Canal+’s international operations, total Revenue reached €10,762m, up 1.4%*; Despite tougher environment, Income from opera
Slide 4: Vivendi: a leading European content and media group
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 ■ Vivendi: a leading European content and media group ■ Investments in content ■ Interests in content production companies ■ Gameloft ■ Investments in media and distribution ■ Investments in digital platforms ■ Partnerships with telcos ■ Cana
Slide 5: Vivendi Today: A Content and Media Group
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 VIVENDI TODAY: A CONTENT AND MEDIA GROUP Revenues by activity Recorded ■ #1 worldwide in recorded music with 34%* of market share. Music Other activities Music & publishing ■ #2 in music publishing with 23%* of market share. 7% 1% Publishing
Slide 6: Investing in Content: Continuous Investment in Our Artists
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN CONTENT: CONTINUOUS INVESTMENT IN OUR ARTISTS TO STRENGTHEN OUR LEADING POSITION RECORDED MUSIC ■ UMG is the world leader in recorded music. ■ UMG’s labels recognized as top-of-the-class in scouting, developing and supporting art
Slide 7: UMG Leading the Transition to Subscription Services
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN CONTENT: UMG, AS THE WORLD LEADER, IS LEADING THE TRANSITION TO SUBSCRIPTION SERVICES MUSIC INDUSTRY IN TRANSITION UMG ■ From the sale of a product to a service, enhancing ■ Strong growth in Streaming and Subscription sales, the
Slide 8: Investing in New Territories for Music Worldwide
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN CONTENT: INVESTING IN NEW TERRITORIES IN ORDER TO CREATE A FAVORABLE ENVIRONMENT FOR MUSIC WORLDWIDE OPPORTUNITY ■ Today, the music industry is very concentrated ■ Improving trends, paving the way to future growth: c. 75% of UM
Slide 9: Investing in Content: Cinema and Series
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN CONTENT: CINEMA AND SERIES CINEMA ■ Studiocanal: the #1 European Studio. An average of 50 films released yearly in its three European territories* Some 2015 successes and nominations Academy Awards Césars 2016 (Oscars) 2016 19
Slide 10: Investing in Content: Interests in Production Companies
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN CONTENT: INTERESTS IN PRODUCTION COMPANIES ■ Investing in production companies in order to reinforce its value proposition in terms of content. VIDEOS ■ Banijay-Zodiak (26.2% interest in the combined ■ Guilty Party*: Creation of
Slide 11: Gameloft – A Leading Player in Entertainment
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 GAMELOFT – A LEADING PLAYER IN ONE OF THE MOST ATTRACTIVE SEGMENT IN ENTERTAINMENT ■ Videogame is already one of the biggest segments of the media industry ■ Mobile games already account for 1/3 of the videogame industry, with the highest exp
Slide 12: Gameloft and Vivendi Cooperation
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 GAMELOFT AND VIVENDI COOPERATION SHOULD BENEFIT BOTH AND SHOULD BOLSTER GAMELOFT’S DEVELOPMENT 1 2 Creativity and Talent Franchises • Creativity is the DNA of Vivendi • Development of franchises businesses • Partnerships with important • Abil
Slide 13: Pay-TV International, a Growth Opportunity
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN DISTRIBUTION & MEDIA: PAY-TV INTERNATIONAL, A GROWTH OPPORTUNITY AFRICA Investing in African content POLAND Launch of A+ (Oct. 2014); 25 new channels launched in 2015. Subscribers*: 2,119k Partnership with iRoko to laun
Slide 14: Strengthened Group Free-to-Air Channels
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN DISTRIBUTION & MEDIA: STRENGTHENED THE GROUP FREE-TO-AIR CHANNELS ■ Thanks to continuous investments, free-to-air channels are well established and recognized. ■ 2015: A record year for Canal+ Group DTT channels with a total audi
Slide 15: A World Class Leader in Digital Distribution
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INVESTING IN DISTRIBUTION & MEDIA: A WORLD CLASS LEADER IN DIGITAL DISTRIBUTION ■ Vivendi became a world class leader in digital distribution through in-house platforms and bolt-on acquisitions DAILYMOTION ■ One of the largest aggregation and
Slide 16: Partnerships with Telcos
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 PARTNERSHIPS WITH TELCOS TELECOM ITALIA ■ Vivendi is an industrial and long-term investor in Telecom Italia… 21.4%* of the ordinary shares; 4 new members to Telecom Italia Board of Directors appointed in December, including 3 Vivendi repr
Slide 17: One Challenge: Canal+ Channels in France
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 ONE CHALLENGE TO ADDRESS: CANAL+ CHANNELS* IN FRANCE PAY-TV MAINLAND FRANCE IS FACING …AND GENERATING LARGER LOSSES CHALLENGES… An erosion of the subscription base Canal+ channels* in France increasing negative Subscription base** Revenue
Slide 18: Canal+ France Transformation Plan
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 ONE CHALLENGE TO ADDRESS: CANAL+ CHANNELS* IN FRANCE - IMPLEMENTATION OF A TRANSFORMATION PLAN ■ A tough situation, but we know what has to be done: regain perceived value by investing in what matters to our clients. CONTENT CUSTOMER EXPERIEN
Slide 19: Canal+ France Transformation Plan: Priorities
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 ONE CHALLENGE TO ADDRESS: CANAL+ CHANNELS* IN FRANCE - IMPLEMENTATION OF A TRANSFORMATION PLAN PRIORITIES 1 Development of entry-level segment BUSINESS: RESUME TO GROWTH Brand architecture redesigning IN TERMS OF SUBSCRIBER BASE Optimiz
Slide 20: Canal+ France Transformation Plan: Customer Experience
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 ONE CHALLENGE TO ADDRESS: CANAL+ CHANNELS* IN FRANCE - IMPLEMENTATION OF A TRANSFORMATION PLAN ■ The need to address all market segments and consumption patterns and redesign the customer experience Set-top box Multiroom, fast zapping 4k, sta
Slide 21: Proposed Agreement with beIN Sports in France
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 PROPOSED AGREEMENT WITH BEIN SPORTS IN FRANCE ■ A 5-year agreement for the distribution of beIN Sports offers by Canal+ in France Agreement covering all technical platforms (ADSL, DTH, OTT); Consideration comprised of an annual minimum gu
Slide 22: Outlook
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 OUTLOOK UNIVERSAL MUSIC GROUP ■ We continue to see positive momentum in the business, driven by ongoing growth in streaming and subscription and tempered by continued declines in download and physical, leading to a reasonable increase in resu
Slide 23: Financials
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 HERVE PHILIPPE Member of the Management Board Chief Financial Officer FINANCIALS
Slide 24: Scope of Consolidation and Main Currencies
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 SCOPE OF CONSOLIDATION AND MAIN CURRENCIES In compliance with IFRS 5, GVT qualifies as a discontinued operation from 3Q 2014, SFR from 1Q 2014 and Maroc Telecom group from 2Q 2013 hence their earnings are reported as “Earnings from discontinu
Slide 25: Key Financial Metrics at End December 2015
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 KEY FINANCIAL METRICS AT END DECEMBER 2015 % change % underlying change* year-on-year year-on-year Revenues: € 10,762 m + 6.7 % + 1.4 % IFRS EBIT: € 1,231 m + 67.2 % Net Income, group share: € 1,932 m - 59.3 % Adjusted measures** Inco
Slide 26: Universal Music Group Highlights
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 Constant perimeter In euro millions - IFRS 2014 2015 Change and constant HIGHLIGHTS currency * Revenues 4,557 5,108 + 12.1% + 2.7% ■ Revenues up 2.7%* driven by growth in all Recorded music 3,688 4,113 + 11.5% + 2.4% segments. Music Publishin
Slide 27: Canal+ Group Highlights
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 Constant perimeter In euro millions - IFRS 2014 2015 Change and constant HIGHLIGHTS currency * ■ Revenues up 0.2%*: Revenues 5,456 5,513 + 1.1% + 0.2% ■ Pay-TV revenues decreased in mainland France Pay-TV Mainland France 3,454 3,383 - 2.1% -
Slide 28: Vivendi Village, New Initiatives and Corporate
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 VIVENDI VILLAGE Constant perimeter HIGHLIGHTS In euro millions - IFRS 2014 2015 Change and constant currency * Vivendi Village Revenues 96 100 + 3.5% - 9.6% Income from operations (34) 10 na na ■ Improvement in Income from operations and EBIT
Slide 29: Adjusted P&L
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 ADJUSTED P&L Constant perimeter In euro millions - IFRS 2014 2015 Change % and constant currency* Revenues 10,089 10,762 + 673 + 6.7% + 1.4% Income from operations 1,108 1,061 - 47 - 4.3% - 5.9% Income from operations margin 11.0% 9.9% - 1.1p
Slide 30: Consolidated P&L
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 CONSOLIDATED P&L In euro millions - IFRS 2014 2015 Change % Revenues 10,089 10,762 + 673 + 6.7% Cost of revenues (6,121) (6,555) Selling, general and administrative expenses excluding amortization (2,865) (3,163) of intangible assets acquired
Slide 31: Consolidated Balance Sheet
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 CONSOLIDATED BALANCE SHEET In euro millions December 31, December 31, December 31, December 31, Assets Equity and Liabilities 2014 2015 2014 2015 Goodwill 9,329 10,177 Consolidated equity * 22,988 21,086 Intangible and tangible assets 4,631 4
Slide 32: Cash Flow from Operations (CFFO)
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 CASH FLOW FROM OPERATIONS (CFFO) CFFO before capex, net CFFO 2014 2015 Change In euro millions - IFRS 2014 2015 Change 471 620 + 31.5% Universal Music Group 425 567 + 33.3% 721 653 - 9.4% Canal+ Group 531 472 - 11.1% (37) (3) + 92.8% Vivendi
Slide 33: Net Cash at Year End 2015
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 NET CASH AT YEAR END 2015 In euro billions Net Cash CFFO before Interest & taxes Acquisitions Distribution to Net Cash Dec. 31, 2014 Capex Capex, net paid and other Disposals investments Share buyback shareholders Other Dec. 31, 2015 -3.3 -0.
Slide 34: Recognition of Our CSR Policy
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 RECOGNITION OF OUR CSR POLICY Recognition of Vivendi’s positioning in The Global Diversity List compiled for the 1st time by The Economist (Oct. 2015) Integration of Vivendi in “SICAV Libertés et solidarité“ of the FIDH managed by Banque Post
Slide 35: Appendices
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 APPENDICES Details of Business Operations: slides 36-37 Detailed Vivendi Financial Results: slides 39-44 Glossary & Disclaimer: slides 46-47
Slide 36: Universal Music Group Details of Business Operations
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 Constant Recorded Music Revenues 2014 2015 perimeter and In euro millions - IFRS 2015 Europe 41% 38% constant North America 39% 42% currency * Asia 11% 11% Recorded music 4,113 + 2.4% Rest of the world 9% 9% Physical sales 1,410 - 6.7% Digita
Slide 37: Canal+ Group Subscribers and Operating Data
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 December 31, December 31, In '000 Change 2014 2015 individual subscribers 11,048 11,241 + 193 Mainland France 6,062 5,746 - 316 International 4,986 5,495 + 509 Poland 2,146 2,119 - 27 Overseas 494 499 +5 Africa 1,552 2,073 + 521 Vietnam 794 8
Slide 38: Appendices: Detailed Vivendi Financial Results
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 APPENDICES Detailed Vivendi Financial Results
Slide 39: Revenues / EBITDA / EBITA
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 REVENUES / EBITDA / EBITA Constant Constant Constant perimeter Revenues Constant perimeter Q4 2014 Q4 2015 Change 2014 2015 Change currency and constant In euro millions - IFRS currency and constant currency * currency * 1,460 1,616 + 10.7% +
Slide 40: Revenues / Income from Operations / EBITA
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 REVENUES / INCOME FROM OPERATIONS / EBITA Constant Constant Constant perimeter Revenues Constant perimeter Q4 2014 Q4 2015 Change 2014 2015 Change currency and constant In euro millions - IFRS currency and constant currency * currency * 1,460
Slide 41: Interest & Income Tax
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 INTEREST & INCOME TAX In euro millions (except where noted) – IFRS 2014 2015 Interest (96) (30) Interest expense on borrowings (283) (65) Average interest rate on borrowings (%) 2.94% 2.91% Average outstanding borrowings (in euro billions) 9.
Slide 42: Capex, Net
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 CAPEX, NET In euro millions - IFRS 2014 2015 Change Universal Music Group 46 53 + 15.2% Canal+ Group 190 181 - 4.7% Vivendi Village 7 7 - New Initiatives - 4 Corporate - 1 Total Vivendi 243 246 + 1.2% 42
Slide 43: Reconciliation of Earnings to Adjusted Net Income
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 RECONCILIATION OF EARNINGS ATTRIBUTABLE TO VIVENDI SA SHAREOWNERS TO ADJUSTED NET INCOME In euro millions - IFRS 2014 2015 Earnings attributable to Vivendi SA shareowners (*) 4,744 1,932 Amortization and depreciation of intangible assets acqu
Slide 44: Reconciliation of EBIT to Income from Operations
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 RECONCILIATION OF EBIT TO INCOME FROM OPERATIONS In euro millions - IFRS 2014 2015 EBIT 736 1,231 Amortization and depreciation of intangible assets acquired through business 436 411 combinations Other income & charges (173) (700) EBITA 999 9
Slide 45: Appendices: Glossary & Disclaimer
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 APPENDICES Glossary & Disclaimer
Slide 46: Glossary
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 GLOSSARY The non-GAAP measures defined below should be considered in addition to, and not as a substitute for, other GAAP measures of operating and financial performance and Vivendi considers this to be relevant indicators of the group’s oper
Slide 47: Important Legal Disclaimer / Contacts
F Y 2 0 1 5 R e s u l t s – F e b r u a r y 1 8 , 2 0 1 6 IMPORTANT LEGAL DISCLAIMER / CONTACTS Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements with respect to Vivendi's financial condition, results of operations, business, strategy, plans,