Lagardere Sa · EURONEXT:MMB

Lagardere Sa — H1 2021 Earnings Presentation

42 slides from Lagardere Sa's earnings presentation, Jul 26, 2021

  1. Slide 1: First-Half 2021 Results

    FIRST-HALF 2021 RESULTS 26 July 2021

  2. Slide 2: Disclaimer

    First-half 2021 results / 26 July 2021 DISCLAIMER By reading this presentation, you agree to be bound by the following limitations and qualifications: This presentation is for information purposes only and does not constitute an offer or solicitation for the sale or purchase of any securities, any p

  3. Slide 3: H1 2021 Highlights

    First-half 2021 results / 26 July 2021 H1 2021 HIGHLIGHTS

  4. Slide 4: Stable H1 2021 group revenue; strong publishing and travel retail performance

    First-half 2021 results / 26 July 2021 STABLE H1 2021 GROUP REVENUE (YOY): STRONG PERFORMANCE IN PUBLISHING & TRAVEL RETAIL BENEFITING FROM US TRAFFIC RECOVERY IN AN UNCERTAIN CONTEXT ROBUST WORK ON PROFITABILITY AND CASH MANAGEMENT Positive Group free cash-flow: thorough cost optimisation and cash

  5. Slide 5: H1 2021 group performance improved vs. H1 2020

    First-half 2021 results / 26 July 2021 H1 2021 GROUP PERFORMANCE IMPROVED VS. H1 2020, LED BY FOCUS ON COST EFFICIENCY AND CASH PRESERVATION H1 2020 comparison basis: impacted by pandemic effects starting in Q2 2020 (€m) H1 2020* H1 2021 Revenue 2,088 2,076 Group recurring EBIT** (218) 3 Operating m

  6. Slide 6: Change in revenue

    First-half 2021 results / 26 July 2021 CHANGE IN REVENUE (€m) 2,088 +181 +8 2,076 63 107 +18.7% (87) +7.9% (55) 115 (59) -9.2% 831 947 1,130 971 H1 2020 Lagardère Lagardère Other Activities Scope FX H1 2021 revenue Publishing Travel Retail effect* effect revenue Revenue down -0.6% as reported, up +5

  7. Slide 7: Significant improvement in recurring EBIT across divisions

    First-half 2021 results / 26 July 2021 SIGNIFICANT IMPROVEMENT IN RECURRING EBIT ACROSS DIVISIONS H1 2021 revenue by division H1 2021 recurring EBIT by division Other Activities*** 110 6% 8%*/**** 27 H1 H1 H1 H1 2020 2021 2020 2021 Lagardère Lagardère H1 H1 €2,076m 2020 2021 (11) Travel Retail Publi

  8. Slide 8: Performance by Division

    First-half 2021 results / 26 July 2021 PERFORMANCE BY DIVISION

  9. Slide 9: Lagardère Publishing: H1 2021 Performance

    First-half 2021 results / 26 July 2021 H1 2021 PERFORMANCE

  10. Slide 10: Strong book sales growth in a reopening context

    First-half 2021 results / 26 July 2021 STRONG BOOK SALES GROWTH IN A REOPENING CONTEXT 2020 & 2021 like-for-like revenue +23% ▪ Strong revenue performance across various segments, in a context of gradual reopening of leisure venues across +14% various geographies ▪ Growth supported by all distributi

  11. Slide 11: General literature and illustrated books still driving growth

    First-half 2021 results / 26 July 2021 GENERAL LITERATURE AND ILLUSTRATED BOOKS STILL DRIVING GROWTH DESPITE SOFTER PERFORMANCE IN OTHER SEGMENTS H1 2021 revenue by geographic area H1 2021 revenue by activity Education 10% UK*** France 11%* 21% 28% 20%* 25%* Illustrated Books General 14% 11%* Spain

  12. Slide 12: Record H1 profitability in an unprecedented environment

    First-half 2021 results / 26 July 2021 RECORD H1 PROFITABILITY IN AN UNPRECEDENTED ENVIRONMENT Change in recurring EBIT (€m) ▪ Despite historical H1 seasonality effect, H1 2021 outstanding and operating margin (%) profitability led by several drivers over the period ▪ Strong demand for Illustrated B

  13. Slide 13: Positive free cash flow and improved working capital

    First-half 2021 results / 26 July 2021 POSITIVE FREE CASH FLOW AND IMPROVED WORKING CAPITAL (€m) H1 2020 H1 2021 Cash flow from operations before changes in working capital 33 113 Changes in working capital (114) (37) Income taxes paid (22) (39) Cash flow from (used in) operations (103) 37 Purchases

  14. Slide 14: Lagardère Travel Retail: H1 2021 Performance

    First-half 2021 results / 26 July 2021 H1 2021 PERFORMANCE

  15. Slide 15: US air traffic recovery driving revenue improvement over H1 2021

    First-half 2021 results / 26 July 2021 US AIR TRAFFIC RECOVERY DRIVING REVENUE IMPROVEMENT OVER H1 2021 2020 & 2021 like-for-like revenue vs. 2019 (vs. passenger traffic) ▪ Revenue correlated to air passenger traffic +1% • Accelerating pace of US traffic rebound over Q2 2021 • Positive dynamics in C

  16. Slide 16: Strategic diversity of businesses and footprint enabling traffic recovery benefit

    First-half 2021 results / 26 July 2021 STRATEGIC DIVERSITY OF BUSINESSES & FOOTPRINT ENABLING LAGARDÈRE TRAVEL RETAIL TO BENEFIT FROM TRAFFIC RECOVERY H1 2021 revenue by geographic area H1 2021 revenue by activity Greater China 14% 7%* Duty Free & Other Asia-Pacific Fashion US & Canada 3% 31% 32% 5%

  17. Slide 17: Increasing operating efficiencies: outstanding flow through in H1 2021

    First-half 2021 results / 26 July 2021 INCREASING OPERATING EFFICIENCIES: OUTSTANDING FLOW THROUGH IN H1 2021 Flow through vs. 2019 24.3% ▪ Outstanding 12.2% flow through delivered in H1 2021 16.7% 12.2% ▪ Keeping up massive efforts to variabilise and reduce costs in a low air traffic environment H1

  18. Slide 18: Significant free cash flow improvement

    First-half 2021 results / 26 July 2021 SIGNIFICANT FREE CASH FLOW IMPROVEMENT THANKS TO EXCELLENT FLOW THROUGH, SOLID WORKING CAPITAL & CAPEX CONTROL ▪ Limited cash consumption in H1 2021 despite low air traffic globally: positive free cash-flow when taking into account favourable working capital (€

  19. Slide 19: Other Activities

    First-half 2021 results / 26 July 2021 OTHER ACTIVITIES

  20. Slide 20: News businesses growth vs. H1 2020 in a reopening environment

    First-half 2021 results / 26 July 2021 NEWS BUSINESSES GROWTH VS. H1 2020 IN A REOPENING ENVIRONMENT H1 2021 revenue by activity ▪ Other Activities revenue growth at +7.9% vs H1 2020*** • Press & Radio revenue growth vs. H1 2020, due to favourable base effect and advertising sales recovery as restri

  21. Slide 21: Group Results

    First-half 2021 results / 26 July 2021 GROUP RESULTS

  22. Slide 22: H1 2021 consolidated income statement

    First-half 2021 results / 26 July 2021 H1 2021 CONSOLIDATED INCOME STATEMENT (€m) H1 2020* H1 2021 Revenue 2,088 2,076 Group recurring EBIT (218) 3 Income (loss) from equity-accounted companies** (23) (22) Non-recurring/non-operating items (156) (98) o/w IFRS 16 impacts on concession agreements (17)

  23. Slide 23: H1 2021 consolidated statement of cash flows

    First-half 2021 results / 26 July 2021 H1 2021 CONSOLIDATED STATEMENT OF CASH FLOWS (€m) H1 2020 H1 2021 Cash flow from (used in) operations before changes in working capital (138) 38 Changes in working capital (269) 88 Income taxes paid (15) (11) Net cash from (used in) operations (422) 115 Purchas

  24. Slide 24: Robust liquidity with €2.0bn available as of 30 June 2021

    First-half 2021 results / 26 July 2021 ROBUST LIQUIDITY WITH €2.0BN AVAILABLE AS OF 30 JUNE 2021 1,970 Debt maturity profile (€m) 1,102 784 596 580 186 440 93 93 100 868 72 189 498 100 498 368 84 298 80 5 93 Available H2 2021 2022 2023 2024 2025 2026 & liquidity beyond Cash position RCF - undrawn Co

  25. Slide 25: Outlook

    First-half 2021 results / 26 July 2021 OUTLOOK ▪ Lagardère Publishing sales normalising on the back of higher attendance of social venues in 2021 • Positive impact of new Asterix release in Q4 2021 to be offset by absence of curriculum reform in France • Profitability expected to benefit from favour

  26. Slide 26: Appendices to the Consolidated Accounts

    First-half 2021 results / 26 July 2021 APPENDICES TO THE CONSOLIDATED ACCOUNTS

  27. Slide 27: Changes in scope: main items

    First-half 2021 results / 26 July 2021 CHANGES IN SCOPE: MAIN ITEMS ▪ Lagardère Publishing • Disposal of J’ai Lu Éditions in April 2021 to Madrigall Group • Acquisition in June 2021 of Hiboutatillus, a French boardgame publisher specialized in party games • Acquisition in June 2021 of Illuminate Pub

  28. Slide 28: Revenue by geographic area

    First-half 2021 results / 26 July 2021 REVENUE BY GEOGRAPHIC AREA 29% 26% 26% 27% 25% 21% 12% 10% 9% 9% 3% 3% H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 2021 France Western Europe Eastern Europe USA & Canada Asia-Pacific Latin America, Middle East, Afr

  29. Slide 29: Summary of performance by division – H1 2021

    First-half 2021 results / 26 July 2021 SUMMARY OF PERFORMANCE BY DIVISION – H1 2021 ▪ Revenue H1 2021 Consolidated Consolidated Like-for-like change* (€m) change change (%) (%) Lagardère Publishing 1,130 +159 +16.4 +18.7 Lagardère Travel Retail 831 -116 -12.3 -9.2 Other Activities 115 +8 +7.5 +7.9 T

  30. Slide 30: Analysis of non-recurring/non-operating items

    First-half 2021 results / 26 July 2021 ANALYSIS OF NON-RECURRING/NON-OPERATING ITEMS Non-retained scope Lagardère Lagardère Other Total (formerly Total Total (€m) Publishing Travel Retail Activities Target scope Lagardère Active) H1 2021 H1 2020* Recurring EBIT** 110 (96) (11) 3 - 3 (218) Income (lo

  31. Slide 31: Adjusted profit – Group share

    First-half 2021 results / 26 July 2021 ADJUSTED PROFIT – GROUP SHARE (€m) H1 2020* H1 2021 Profit (loss) for the period (437) (172) Restructuring costs 12 26 Gains/losses on disposals 8 (20) Impairment losses on goodwill, PP&E, intangible assets and investments 63 6 in equity-accounted companies Amo

  32. Slide 32: Group recurring EBIT to adjusted profit (loss) – Group share

    First-half 2021 results / 26 July 2021 GROUP RECURRING EBIT TO ADJUSTED PROFIT (LOSS) – GROUP SHARE (€m) H1 2020* H1 2021 3 9 6 (9) (7) (4) (23) (22) (25) (31) (41) (86) (218) (276) Income tax Group Income (loss) Interest expense excluding Adjusted profit (loss) Adjusted expense on lease Finance cos

  33. Slide 33: Free cash flow reconciliation

    First-half 2021 results / 26 July 2021 FREE CASH FLOW RECONCILIATION (€m) H1 2020* H1 2021 Cash flow from operating activities before changes in working capital 27 153 Repayment of lease liabilities (113) (94) Interest paid on lease liabilities (37) (11) Changes in working capital of lease liabiliti

  34. Slide 34: Consolidated balance sheet

    First-half 2021 results / 26 July 2021 CONSOLIDATED BALANCE SHEET Equity and liabilities Assets* (€m) 31 Dec. 2020 30 Jun. 2021 31 Dec. 2020 30 Jun. 2021 827 686 Total equity Intangible assets 2.436 2.426 1.733 Net debt** 1.716 Right-of-use assets Lease liabilities (IFRS 16) 1.939 1.669 2.246 2.047

  35. Slide 35: Consolidated balance sheet: net debt of €1,716m

    First-half 2021 results / 26 July 2021 CONSOLIDATED BALANCE SHEET (€m) 31 Dec. 2020 30 Jun. 2021 Non-current assets 5,519 5,219 Investments in equity-accounted companies 52 34 Current assets 2,223 2,228 Short-term investments and cash 687 868 Assets held for sale - - TOTAL ASSETS 8,481 8,349 Total e

  36. Slide 36: Glossary (1/3)

    First-half 2021 results / 26 July 2021 GLOSSARY (1/3) Lagardère uses alternative performance measures which serve as key indicators of the Group's operating and financial performance. These indicators are tracked by the Executive Committee in order to assess performance and manage the business, as w

  37. Slide 37: Glossary (2/3)

    First-half 2021 results / 26 July 2021 GLOSSARY (2/3) ▪ Flow through is calculated by dividing the change in recurring operating profit of fully-consolidated companies (recurring EBIT) by the change in revenue. This indicator is used by the Group in the context of the Covid-19 pandemic to measure th

  38. Slide 38: Glossary (3/3)

    First-half 2021 results / 26 July 2021 GLOSSARY (3/3) ▪ Adjusted profit – Group share is calculated on the basis of profit for the period, excluding non-recurring/non-operating items, net of the related tax and of minority interests, as follows: Profit for the period excluding: • Gains (losses) on d

  39. Slide 39: IFRS 16 Impact on the Consolidated Accounts

    First-half 2021 results / 26 July 2021 IFRS 16 IMPACT ON THE CONSOLIDATED ACCOUNTS

  40. Slide 40: Impact of IFRS 16 on the consolidated income statement and related indicators

    First-half 2021 results / 26 July 2021 IMPACT OF IFRS 16 ON THE CONSOLIDATED INCOME STATEMENT AND RELATED INDICATORS (€m) H1 2020* FY 2020 H1 2021 Recurring EBITDA** (1) (2) (2) Group recurring EBIT** +7 +13 +7 Income from equity-accounted companies*** 2 - - Non-recurring/non-operating items (17) (1

  41. Slide 41: Impact of IFRS 16 on the consolidated statement of cash flows

    First-half 2021 results / 26 July 2021 IMPACT OF IFRS 16 ON THE CONSOLIDATED STATEMENT OF CASH FLOWS (€m) H1 2020* FY 2020 H1 2021 Cash flow from operating activities before changes in working capital +171 +295 +111 Repayment of lease liabilities (113) (236) (94) Interest paid on lease liabilities (

  42. Slide 42: Impact of IFRS 16 on the consolidated balance sheet

    First-half 2021 results / 26 July 2021 IMPACT OF IFRS 16 ON THE CONSOLIDATED BALANCE SHEET (€m) 31 Dec. 2020 30 Jun. 2021 (€m) 31 Dec. 2020 30 Jun. 2021 Total equity (187) (239) Non-current assets +2,022 +1,764 Non-current liabilities +1,843 +1,690 Right-of-use asset +1,939 +1,669 Lease liability –

Lagardère — H1 2021 Earnings Presentation on 6ix