2. mathias hermansson   group financial management
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2. mathias hermansson group financial management

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2. mathias hermansson   group financial management 2. mathias hermansson group financial management Presentation Transcript

  • 1
  • MathiasHermanssonChief FinancialOfficerBorn 1972Joined MTG in 1999What I love: The feeling of WINNINGWhat I hate: Surprises, especially financialand negative…Favourite quote: “Cash is Cash – Everythingelse is just an opinion.”1.
  • Value creation the MTG way Revenues & EBIT Return on capital employed SEKm16,000 30%14,000 27% 34% 24% 31%12,000 29% 29% 21% 25%10,000 18% 21% 21% 8,000 15% 12% 15% 15% 6,000 9% 4,000 6% 6% 2,000 3% 0 0% Revenues EBIT EBIT-margin Excluding non-recurring items Total EBIT excluding discontinued operations and one-offs 3
  • Consistent outperformance 20% MTG CTC Media 15% EBIT Growth CAGR 05-11 TVN 10% BskyB ProSiebenSat1 5% ITV M6 0% TF1 -5% -10% Mediaset -15% Antena 3 Mediaset Esp -20% -25% CME -30% -35% -5% 0% 5% 10% 15% 20% 25% Revenue Growth CAGR 05-11 Source: Broker research, Factset4
  • Innovation driving growth Made To Grow... organically Launch of the Viaplay set-top-box in Sweden… Launch of online streaming OTT offering Viaplay in the Nordics Launch of TV10 in Sweden, 3D TV introduced in the Nordics Launch of several new channels (Viasat Hockey, TV3 PULS, Prima COOL) Virtual IPTV Operator invented, Launch of free-TV in Ghana (W Africa) Launch of the first DTH pay-TV platform in Ukraine, viasatondemand launched Launch of TV6 in Sweden, further expansion of the mini-pay business in CEE Launch of the first IPTV services in Europe, Launch of Viasat PVR Viasat DTH platform launched in the Baltics The mini-pay wholesale channel business is launched in Eastern Europe Secondary channels Tango TV launched in Lithuania5
  • Strict cost control Underlying strict cost control, while balancing organic investments to drive growth (%)Y-o-Y growth at constant FX rate 16 14 12 • <0.5% annual cost 10 increase last three 8 years when excluding content 6 costs & variable 4 costs 2 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 09 09 09 09 10 10 10 10 11 11 11 11 12 Sales Costs 6
  • Cash is king Net operating cash flow (SEKm) Dividends received from CTCM2,500 100% (SEKm) 1402,000 80% 120 1001,500 60% 801,000 40% 60 40 500 20% 20 0 0% 0 Net operating cash flow % of EBITDA converted 7
  • Managing working capital down Working capital development (% of revenues) 10% • Significant improvements in inventory management 8% • Tighter management of 6% supplier payments terms and collection routines 4% • Seasonal fluctuations within calendar year 2% 0%8
  • Asset light business model Capex development (SEKm) 400 0.4% 350 0.4% • Capex has historically 300 0.3% represented a low percentage of revenues 250 0.3% and this is expected to 200 0.2% continue 150 0.2% 100 0.1% 50 0.1% 0 0.0% Capex % of sales9
  • Deleveraging at the same time(SEKm) Net Debt 5,000 4,000 • Net debt below SEK 750 3,000 million as at 31 March 2012 2,000 1,000 • SEK 6.5 billion revolving credit facility matures in 0 2015 Q1 09 Q4 09 Q3 10 Q2 09 Q3 09 Q1 10 Q2 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12(SEKm) Available Liquid Funds • More than SEK 5.5 billion 6,000 of liquid funds available within less than a week 5,000 4,000 3,000 2,000 1,000 0 Q1 11 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q2 11 Q3 11 Q4 11 Q1 12 10
  • While creating greater flexibility Net debt / EBITDA Net debt / EBITDA (2011) 0.2 M6 -1,0 0.1 CTC Media -0,5 Mediaset Esp. -0,1 0.1 ITV -0,1 TF1 0,1 0.1 MTG 0,3 0.1 Antena 3 0,6 BskyB 0,7 0.1 ProSiebenSat.1 2,1 Mediaset 2,4 0.0 TVN 4,0 0.0 CME 6,8 Average 1,3 0.0 EBITDA excluding CDON Group, DTV, TV Shop and non-recurring items, inlcluding Source: Broker research, Factset associated income11
  • For investing in growth &returning cash to shareholders• Primary focus is on growth and reinvesting cash flow into operations + M&A• Balanced with TSR commitment – reflected in newly adopted policy to distribute at least 30% of recurring net profit as annual ordinary dividend Cash distribution (SEK) 0.40 Buybacks (value per share) 0.35 CDON spin-off 0.30 Extraordinary dividend per 0.25 share 0.20 Ordinary dividend per share 0.15 Net cash flow per share 0.10 EPS adj (excluding one-offs) 0.05 30% of EPS adj (excluding 0.00 one-offs)12 2006 2007 2008 2009 2010 2011
  • Allocating capital to structurallygrowing regionsCash flows from Scandinavia invested into EmergingMarkets2000: Acquisition of 95% of Hungarian operation2001: Acquisition of 75% of DTV in Russia2002: Acquisition of 36% of CTC Media in Russia2005: Acquisition of 50% of Prima TV in Czech Republic2006: Acquisition of 100% of Slovenian operation2007: Acquisition of 50% of Diema channels in Bulgaria2008: Acquisition of 50% of pay-TV platform in Ukraine2008: Acquisition of 100% of Nova TV in Bulgaria2010: Acquisition of 50% of pay-TV platform in Russia2010: Acquisition of additional 35% of Viasat Ukraine2012: Acquisition of 100% of LNT free-TV group in Latvia13
  • And the show must go onM&A team of 4 professionals hired from Nordic & internationalinvestment banks• Focus on market consolidation opportunities across all existing markets, acquisitions in additional CEE & African territories and content production businesses.Key investment criteria• Broadcasting or broadcasting related assets X• Markets / companies with structural growth opportunities X• Synergies with existing operations X• Strong incremental profitability model X• Ability to grow with the flow X• ROI hurdle rates• Contrarian & Opportunistic strategy – now is the time• Learn from previous successes & mistakes14
  • So, what does the future hold?Key focus is long term growth and value creation …the MTG wayStrong cash generation to continue• Continued low working capital and capex as percentage of sales• Expected total CTC Media cash dividends of USD 80m during 2012Commitment to continue to invest in future growth• Re-investment in current businesses + new start-ups to ‘grow with the flow’• Explore consolidation, new market and content production M&A opportunitiesCommitment to deliver shareholder returns• Dividend policy to distribute at least 30% of recurring net profit to shareholders• Buy-back mandate in place for up to 10% of shares15
  • 16CHAPTER NAME