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140110 mtg corporate presentation
 

140110 mtg corporate presentation

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    140110 mtg corporate presentation 140110 mtg corporate presentation Presentation Transcript

    • MODERN TIMES GROUP SHAPING THE FUTURE OF ENTERTAINMENT JANUARY 2014 1
    • THE STORY A SUCCESSFUL TRACK RECORD (10Y) A UNIQUE PLATFORM A BRIGHT FUTURE INTEGRATED & DIVERSIFIED RISING VIDEO CONSUMPTION 25% ROCE (AV) TV EVERYWHERE & FOR EVERYONE CONTENT RICH 15% TSR CAGR DECENTRALIZED 10% SALES CAGR 17% EBIT CAGR DIGITAL DELIVERY & ENGAGEMENT 2
    • LONG TERM VALUE CREATION BASED ON CLEAR GROWTH STRATEGY CONTENT DIGITAL GEO EXPANSION Multi-platform & country content acquisition & monetization strategy Leading content creator, producer & distributor First to market full service SVOD OTT operator & leading AVOD player + wide range of new products & services Focus on roll-out of new products to existing markets + expansion in CEE & Africa 3
    • CONTENT REMAINS KING WE ARE THE BIGGEST BUYER IN TOWN TOTAL NUMBER OF BROADCAST HOURS (2013) 1,000,000 900,000 879,470 800,000 700,000 600,000 481,800 500,000 394,200 400,000 297,840 300,000 236,520 210,240 CME Pro7 200,000 100,000 0 MTG RTL Bonnier Mediaset Source: MTG Research 4
    • LONG TERM PARTNERSHIPS WITH RELEVANT CONTENT PROVIDERS 5
    • OUR IN-HOUSE STUDIOS BUSINESS HAS QUADRUPLED IN SIZE TOP 5 TV PRODUCERS IN THE NORDICS (BY SALES 2012) TOP 10 CONTENT DISTRIBUTORS (RATED BY UK INDEPENDENT TV PRODUCERS) HIGHEST RATED 1 BBC WW 1 BBC WW 2 ITV Global 2 DRG 3 DRG 3 Zodiak Rights 3 Zodiak Rights 4 ITV Global 3 Shine 5 Fremantle Enterprises 6 Fremantle Enterprises 6 Endemol WW 6 Endemol WW 7 Electric Sky 6 DCD Media 8 Passion Distribution 6 + MOST USED All3Media 9 All3Media 10 Passion Distribution 9 Sky Vision Source: Televisual Distributor Poll, September 2013 #1 IN THE NORDICS…EXPANDING EMERGING MARKETS FOOTPRINT…GLOBAL DISTRIBUTION CAPABILITY 6
    • OFFICIAL BROADCASTER OF NEXT MONTH’S WINTER OLYMPICS 7
    • VIDEO CONSUMPTION IS GROWING VIDEO USAGE IN THE USA – MINUTES PER DAY PER USER (2+) 350 358 357 365 +18% CAGR 337 NON – LINEAR 323 NON-LINEAR ONLINE VIDEO MOBILE VIDEO 1 TIME SHIFTED 2 +1% CAGR LINEAR TRADITIONAL LINEAR TV Q1 ’08 Q1 ’09 Q1 ’10 Q1 ’11 Q1 ’12 Q1 ‘13 1 Data for Q1 2008 as of May 2008; Mobile video data referring to watching Video via phone 2 Data for all TV households (significantly higher for household that own a DVR) SOURCE: Nielsen Cross Platform reports 8
    • VIAPLAY OPENS UP A NEW WORLD AS OTT ENABLES UNIVERSAL REACH 9
    • DEVELOPING FAST WITH A WIDE RANGE OF DIGITAL PRODUCTS ViaPlay Premium VOD TV, Movies and Sports Free VOD TV Channels Ad Financed Services Free VOD Sport Clips Ad Financed Service Free Music Streaming Ad Financed Service Mobile TV Companion 2nd Screen Application Download Games Store Transaction Service Klipster Coupon Service Online to Store App Vertical video content sites style, family, food, cool etc. 10
    • MTGX - THE GROUP PLATFORM TO ACCELERATE DIGITAL GROWTH xPLAY xVENTURES xCREATIONS xLABS Viaplay TV play Sports Music Games Like.TV Mobisodes Webisodes TV extensions Web / Apps Social Sign-on (World class VOD) (Build portfolio of services) (Digital first productions) (Digital development) 11
    • BUT EACH MARKET IS DIFFERENT DIGITALISATION TIMELINE TV AD MARKET SIZE (USD MN) 4,448 CZECH RUSSIA REPUBLIC CZECH REPUBLIC 401 SWEDEN 2007 2012 2015 BROADBAND PENETRATION Czech 849 Sweden PAY–TV PENETRATION 87% 86% 63% 45% 40% Russia Russia 37% Czech Sweden Czech Russia Sweden 12
    • HUGE POTENTIAL DIGITAL DECISION TIME FOR 150 MILLION RUSSIANS 38% OWNERSHIP IN CTCM EUROPE'S BIGGEST TV AD MARKET IN 2015 OWN 5 OUT OF TOP 20 PAY CHANNELS INC. TOP 2 – MORE THAN 60 MN SUBSCRIPTIONS HD PREMIUM PACKAGE ROLL-OUT 13
    • THE NEXT BIG THING SSA = 7/10 FASTEST GROWING ECONOMIES 2011-15 #2 FREE-TV CHANNEL IN GHANA & SOON TO LAUNCH IN TANZANIA PAY-TV CHANNELS NOW AVAILABLE IN 6 COUNTRIES ESTABLISHED CONTENT PRODUCTION & DISTRIBUTION PLAYER 14
    • WE CAN CONTINUE TO INVEST DUE TO OUR ASSET LIGHT & CASH GENERATIVE SET-UP NET DEBT (SEK MN) STRONG CASH FLOW GENERATION (SEK MN) 2,500 4,000 3,500 2,000 3,000 2,500 1,500 2,000 1,000 1,500 1,000 500 500 0 2008 2009 2010 2011 2012 Sep-2013 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 LTM 15
    • SEGMENTAL HIGHLIGHTS AND Q3 PERFORMANCE 16
    • Q3 2013 – HIGHLIGHTS INVESTING IN MOMENTUM  Sales up 9% at constant FX - all 5 segments reported local currency sales growth for first time since Q1 2011  FTV Scandi – growing again on a combined basis & positive traction to Fall schedules (new channel coming in Norway)  FTV EM – advertising market share gains in almost all territories in soft markets (new channel coming in Tanzania)  PTV Nordic – rising Viaplay volumes & Viasat ARPU driving sales growth & operating margin of 11.9%  PTV EM – healthy sales growth driven by mini-pay Russia & profitability in line with ongoing HD roll-out  Acquisition of Nice Entertainment establish MTG Studios as a scale international content production & distribution player + MTGx digital accelerator established  Continued strong cash flow generation & low gearing enable ongoing investment in growth & shareholder returns  Coverage of the Winter Olympics will boost sales and adversely impact Q1 2014 profits for both the Nordic pay-TV and Scandinavian free-TV businesses 17
    • Q3 IN FIGURES GROWTH & INVESTMENTS Sales up 9% y-o-y at constant FX  Q3 in brief 2012 Jul-Sep 2013 Jul-Sep 2,940 3,204 Growth (at constant FX) -1% 9% 288 162 9.8% 5.0% 422 289 14.4% 9.0% Organic growth at 5% Sales (SEKm) EBIT margin (excl. associates) of 5.0%  OpEx up 15% at constant FX and 11% organically EBIT excl. associates  Significant investments in Nordic & Emerging Markets pay-TV businesses to drive future growth EBIT margin excl. associates Continued strong cash conversion Total EBIT Total EBIT margin  Working capital change in the quarter reflecting the timing of programming payments. Still under strict control Cash flow from operations 237 210  Dividend stream from CTC Media of SEK 62m (51) Changes in working capital 65 -160  Acquisition of DRG, Novemberfilm and Net info Net cash flow from operations 302 49 18
    • FREE-TV SCANDINAVIA GROWTH BACK INTO POSITIVE TERRITORY STABLE SALES (Y-O-Y) AT CONSTANT FX EBIT (SEK MN) AND EBIT MARGIN (%) 12% 10% 8% 6% 4% 2% 0% -2% -4% -6% -8% -10% 250 25% 200 20% 15.4% 150 13.3% 15% Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 Q1 2012 Q4 2011 Q3 2011 Q2 2011 100 10% 50 5% 0 0% Q3 2012 EBIT Q3 2013 EBIT margin OPEX GROWTH (FY 13) STILL EXPECTED TO BE AT THE HIGHER END OF THE MID-SINGLE DIGIT PERCENTAGE RANGE 19
    • FREE-TV SCANDINAVIA WEAK START BUT STRONG ENDING TO THE QUARTER CSOV (15-49) – Q3 2013 VS Q3 2012 40.0 35.0 30.0 25.0 20.0 15.0 10.0 5.0 0.0 CSOV (15-49) – 2006 TO 2013 (YTD) 40 35.8 34.7 35 25.8 21.6 30 18.5 17.3 25 20 15 10 Sweden Q3 2012 Denmark Norway Q3 2013 2006 2007 Sweden 2008 2009 2010 2011 Denmark 2012 9m 2013 Norway WITH FURTHER OPPORTUNITIES – HOWEVER THERE IS A LAG BETWEEN AUDIENCE SHARES AND AD SHARES 20
    • FREE-TV EMERGING MARKETS STRONG GROWTH – TOUGHER COMPS AHEAD 21% SALES GROWTH (Y-O-Y) AT CONSTANT FX EBIT (SEK MN) AND EBIT MARGIN (%) 30% 3.8% 50 20% 8% 6% 100 25% 4% 2% 15% 0 10% 0% -50 5% Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 Q1 2012 Q4 2011 Q3 2011 Q2 2011 0% -5% 7.9% 150 35% -2% -100 -4% Q3 2012 9m 2012 EBIT Q3 2103 9m 2013 EBIT margin IMPROVED PROFITABILITY BUT CONTINUED INVESTMENTS AT THE SAME TIME AS GROWTH IS EXPECTED TO MODERATE 21
    • FREE-TV EMERGING MARKETS AUDIENCE SHARE GAINS IN ALMOST ALL MARKETS CSOV (15-49) – (%) 60 50 TV AD MARKETS IN MTG TERRITORIES 47.0 50.0 40.4 40 28.4 30 32.8 36.0 20 10 0 Baltics Bulgaria Q3 2012 Czech Rep. 10 9 8 7 6 5 4 3 2 1 0 Q3 2013 SEK 8.6 bn 2008 SEK 5.4 bn 2012 SEK 3.2 BN OR 60% GROWTH POTENTIAL IF WE SEE A FULL RECOVERY IN THE TV AD MARKET 22
    • PAY-TV NORDIC PROFITABILITY INLINE WITH EXPECTATIONS 7% SALES GROWTH (Y-O-Y) AT CONSTANT FX EBIT (SEK MN) AND EBIT MARGIN (%) 12% 300 10% 250 8% 200 6% 150 4% 100 2% 50 Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 Q1 2012 Q4 2011 Q3 2011 Q2 2011 0% 20% 15.9% 15% 11.9% 10% 5% 0 0% Q3 2012 EBIT Q3 2013 EBIT margin LOOK FOR A MARGIN OF 11-12% FOR 2013 AND HIGHER MARGIN 2014 DESPITE THE WINTER OLYMPICS 23
    • PAY-TV NORDIC VIAPLAY VOLUME & VIASAT ARPU GROWTH PREMIUM SUBSCRIBER DEVELOPMENT (‘000) ARPU FOR PREMIUM DTH (SEK) - ANNUALIZED 1,200 5,200 1,000 5,000 800 4,800 600 400 4,600 200 4,400 Satellite subscribers 3'rd party network subscribers Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 0 4,200 4,000 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2011 2011 2012 2012 2012 2012 2013 2013 2013 OVERALL SUBSCRIBER BASE UP IF YOU INCLUDE VIAPLAY BUT PREMIUM DTH DOWN AS ANTICIPATED 24
    • PAY-TV NORDIC OTT OPENS UP A NEW WORLD PC/MAC SMART PHONES TABLETS OVER THE TOP 9 MN HOUSEHOLDS + VIRTUAL OPERATOR GAME CONSOLES SMART TVSETS 4.2 MN HOUSEHOLDS TV SET-TOP BOXES OTT STB DTH 1.6 MN HOUSEHOLDS FIRST TO MARKET DRIVEN BY AN EARLY DECISION TO HAVE A PLATFORM AGNOSTIC APPROACH 25
    • PAY-TV EMERGING MARKETS RUSSIA DRIVES GROWTH & INVESTMENTS 7% SALES GROWTH (Y-O-Y) AT CONSTANT FX EBIT (SEK MN) AND EBIT MARGIN (%) 25% 80 25% 70 20% 60 50 15% 20% 17.9% 15% 40 10% 9.7% 30 20 5% 5% 10 0 Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 Q1 2012 Q4 2011 Q3 2011 Q2 2011 0% 10% 0% Q3 2012 EBIT Q3 2013 EBIT margin EXPECT TO ACHIEVE A BETTER THAN BREAKEVEN EBIT RESULT FOR FY13 WITH RISING PROFITABILITY LEVELS IN 2014 26
    • PAY-TV EMERGING MARKETS CONTINUED STRONG SUBSCRIPTION GROWTH SUBSCRIBERS / SUBSCRIPTIONS (‘000) INVESTING INTO THE HD MARKET IN THE CIS 100 90 80 70 60 50 40 30 20 10 0 700 600 500 400 300 200 100 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 9m 2013 Mini-Pay subscriptions (million) DTH ('000) 395 RUB ($13) = ADDED ALMOST 16 MILLION MINI-PAY SUBSCRIPTIONS SINCE LAST YEAR TO A TOTAL OF 91 MILLION 27
    • PAY-TV EMERGING MARKETS MARKETS DRIVEN BY PENETRATION & DIGITALIZATION DIGITAL PAY-TV HOUSEHOLDS (MILLIONS) IN EASTERN EUROPE RUSSIA & UKRAINE: PREMIUM PAY REVENUES EXPECTED TO THREEFOLD (MILLIONS USD) 35 30 24 25 30 15 12 1 2 2006 2007 10 4 6 15 300 269 250 21 20 212 200 18 161 150 9 114 100 50 8 13 20 40 65 58 64 70 WE OWN 5 OUT OF THE TOP 20 PAY CHANNELS IN RUSSIA INCLUDING THE TOP TWO Note: Measured by Average Monthly Reach 28 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2005 0 0 2004 5 27 322 334 350
    • MTG STUDIOS     PRODUCTION HOUSE Sweden Norway Denmark Holland           Hungary Bulgaria Slovenia Romania Serbia Czech Rep. Costa Rica Latvia Estonia Lithuania SALES OF SEK1.7BN (2012 PROFORMA), PRODUCING >3,500H OF CONTENT SOLD TO >80 COUNTRIES 29
    • SUMMARY SHAPING THE FUTURE OF ENTERTAINMENT  Accelerated sales growth following investments in content, digital and geographical expansion  Established Nordic free & pay-TV operator with leading online positions  Expanding emerging market presence + largest shareholder in CTC Media  Scale content production & distribution arm + MTGx digital accelerator  Commitment to growth & shareholder returns supported by high cash conversion & low gearing 30
    • THANK YOU! MTG INVESTOR RELATIONS FOR FURTHER INFORMATION, PLEASE VISIT WWW.MTG.SE, TEL: +46 (0) 73 699 2714 OR EMAIL: INVESTOR.RELATIONS@MTG.SE 31