2. Q4 2013 – HIGHLIGHTS
Accelerated growth for 5th consecutive quarter - sales up 14% at constant FX & 6% on an organic basis
Free-TV Scandi – audience shares up in all 3 markets & segment sales growing again
Free-TV Emerging Markets – continued strong growth in soft market conditions with further investments
Pay-TV Nordic – net subscriber growth, rising prices & operating margin within the range
Pay-TV Emerging Markets – volume growth & profitability above expectations
Studios – organic + M&A led growth with rising profitability levels
Proposed annual ordinary cash dividend of SEK 10.50 = record high pay-out ratio of 56% excl. non-recurring items
2
4. FREE-TV SCANDINAVIA
AUDIENCE SHARE GAINS & GROWTH RETURN
Sales up 1% at constant FX
2013
2012
Oct-Dec
Oct-Dec
1,149
1,147
Growth (at constant FX)
1%
-6%
Audience share gains in all three markets
EBIT (SEKm)
214
250
Denmark - highest Q4 CSOV since 2000
EBIT margin
18.6%
21.8%
Sweden - up every month since launch of Fall schedule
Norway - boosted by launch of 3rd channel (TV6) at end of November
Sweden
31.8%
31.5%
Healthy margin with continued investments
Norway
16.9%
16.7%
OpEx up 5% at constant FX - below original expectation due to later
launch of TV6 & lower level of required programming investments
Denmark
25.2%
20.6%
Exclusive coverage in Sweden of Winter Olympics will boost sales &
adversely impact Q1 2014 earnings
Growth for 2nd consecutive quarter
Swedish & Danish TV ad markets estimated to have been stable with
low levels of growth in Norway
27% of Group sales
Sales (SEKm)
CSOV (15-49)
4
5. PAY-TV NORDIC
SUBSCRIBER GROWTH + RISING PRICES
Sales up 7% at constant FX
Driven by Viaplay & satellite premium ARPU & TV3 Sport channels
32% of Group sales
2013
2012
Oct-Dec
Oct-Dec
1,368
1,286
Subscriber Growth + Rising Prices
Sales (SEKm)
3rd party subscriber volume growth (q-o-q) more than offsets
satellite decline for first time in 2 years
Growth (at constant FX)
7%
3%
EBIT (SEKm)
165
198
Premium satellite ARPU continued to rise following price increases
12.0%
15.4%
Continued strong Viaplay subscriber intake + price increases
Premium subs ('000)
977
1,019
o/w satellite ('000)
559
592
o/w third party ('000)
418
427
5,075
4,988
Margin within the expected range
Continue to expect higher EBIT margin for FY14
Exclusive coverage in Sweden of Winter Olympics will boost sales
& adversely impact Q1 2014 earnings
EBIT margin
Satellite premium ARPU (SEK)
5
6. FREE-TV EMERGING MARKETS
INVESTING IN MOMENTUM
Sales up 18% at constant FX
19% of Group sales
Lithuanian, Estonian, Bulgarian & Ghanaian TV ad markets estimated
to have grown; Latvian, Czech & Hungarian markets estimated to
have declined
2012
Oct-Dec
Oct-Dec
Sales (SEKm)
784
675
Growth (at constant FX)
18%
8%
83
104
10.6%
15.4%
51.8%
48.5%
Czech Republic (15-54)
Driven by sales co-operations + good underlying growth + M&A
2013
Pan-Baltic (15-49)
34.1%
39.1%
Bulgaria (18-49)
36.9%
34.1%
EBIT (SEKm)
Record high audience shares in Bulgaria & Baltics
EBIT margin
37% Bulgarian media house CSOV – a new record
52% Pan-Baltic CSOV – a new record
Czech Republic media house CSOV down due to Prima Family
CSOV
EBIT impacted by higher investments
Profitability
(Tanzania)
Tough comps, intense competition & soft markets in 2014. Q1 will be
impacted by the broadcasting of the Olympics in the Baltics.
impacted
by
programming
investments
and
TV1
6
7. PAY-TV EMERGING MARKETS
OUT-PERFORMING EXPECTATIONS
Sales up 20% at constant FX
Driven by wholesale subscription, satellite subscriber volume growth,
ad sales in Russia and some positive timing effects
8% of Group sales
2013
2012
Oct-Dec
Oct-Dec
Continued subscription/subscriber growth
Sales (SEKm)
322
271
Addition of >8m mini-pay subscriptions in 2013 and almost 1m in Q4
Growth (at constant FX)
20%
19%
Addition of 24k satellite subscribers in Q4 following growth in Baltics,
Russia & Ukraine – base stable y-o-y
51
5
15.9%
1.9%
581
584
92,223
83,950
Higher profits – no change in FY14 expectations
EBIT (SEKm)
EBIT margin
Subscribers / subscriptions ('000)
Q4 EBIT boosted by seasonal impact of Russian ad sales, as well as
~SEK 15m positive one-off items
Satellite
No change to the expectation for rising profitability levels in 2014
Mini-pay wholesale
7
8. MTG STUDIOS, MTGX, RADIO
STUDIOS DRIVES GROWTH
Organic + M&A led sales growth
13% organic sales growth driven by MTG Studios. Radio sales
stable in Norway & down in Sweden
2013
2012
Oct-Dec
Oct-Dec
Sales (SEKm)
13% of Group sales
593
316
Growth (at constant FX)
89%
-29%
Growth (organic)
13%
n/a
11
0
1.9%
0.0%
M&A growth from acquisition & consolidation of Nice Entertainment
(Nov), DRG & Novemberfilm (Jun)
OpEx up, Profits up
Healthy profitability in MTG Studios and Radio Norway
Reduced losses in Radio Sweden after cost savings
Ongoing investment by MTGx to accelerate digital development –
Splay & Net Info are two examples of exciting new areas
EBIT (SEKm)
MTG Studios now a scale player
The leading Nordic content production company
With a leading global distribution arm in DRG
EBIT margin
And an Emerging Markets specialist in Paprika Latino
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9. INCOME STATEMENT
INVESTMENTS DELIVER GROWTH
Sales up 14% at constant FX
Negative FX impact of ~ 1 percentage point
6% organic growth
Acquisitions add ~ 8 percentage points of growth
Q4 in brief
2013
Oct-Dec Oct-Dec
Sales (SEKm)
4,083
3,620
14%
0%
Organic growth (at constant FX)
6%
2%
457
514
11.2%
14.2%
Sales growth (at constant FX)
11% EBIT margin (excl. associates and non-recurring items)
2012
OpEx up 18% at constant FX & 10% organically
Driven by previously announced investments + acquisitions
EBIT excl. associates & non-recurring items
SEK 147m non-cash asset impairment charge related to
Raduga joint venture
Margin excl. associates & non-recurring items
The Raduga revenues that MTG consolidated represented less
than 0.5% of Group full year 2013 net sales.
Total EBIT excl. non-recurring items
564
476
Non-recurring items
-147
-
Total EBIT margin excl. one-offs
417
476
Effective tax rate of 30% for FY13
Expect FY14 rate to be in 25-30% range
9
10. CASH FLOW
HIGH CASH CONVERSION LEVELS
Healthy cash flow generation
SEK 1.3bn of cash flow from operations
74% of earnings converted into operating cash flow & 65%
when including increase in WC from record low levels
(SEKm)
2013
2012
Jan-Dec Jan-Dec
1,340
1,655
Changes in working capital
Cash flow from operations
-120
261
Net cash flow from operations
1,220
1,915
SEK 246m cash dividend payments received from CTCM
Investing to drive future growth
Investments in shares of SEK 905m to drive growth
Higher CapEx of SEK 319m reflects investments in new playout centre in the UK, Zitius, MTGx and Viaplay
Cash flow used in investing activities
-1,224
-351
Zitius sale proceeds to come in 2014
Cash flow used in financing activities
96
-1,274
Net change in cash & cash equivalents
92
291
10
11. FINANCIAL POSITION
RECORD HIGH PAY-OUT RATIO
Strong financial position
Net debt to trailing twelve month EBITDA ratio of just
0.5 times at year end
SEK 5.6 bn of available liquid funds
Net debt / Trailing 12 month EBITDA
Recently refinanced on attractive terms
1.2 1.2
1.1
0.8
0.7
SEK 5.4 bn market value of CTC Media stake as at YE
0.7
0.6
0.5
SEK 1.9 bn book value of 37.9% CTC Media stake
0.3 0.3 0.3 0.3
0.2
0.1
Q4 13
11
Q3 13
Continuing to balance investments in future growth with
shareholder returns
Q2 13
Q1 13
Q4 12
Q3 12
Q2 12
Q1 12
Q4 11
Q3 11
Q2 11
Q1 11
Q4 10
Q3 10
Record pay-out ratio of 56% excl. non-recurring items
Q2 10
0.0 0.0
Q1 10
Board proposes annual cash dividend of SEK 10.50
12. Q4 2013 – SUMMARY
STRONGER PRODUCTS. HIGHER GROWTH
PRODUCTS & CONSUMER OFFERINGS STRONGER, MORE RELEVANT & MORE
AVAILABLE THAN EVER
AUDIENCE SHARE GAINS & SUBSCRIBER GROWTH IN ALMOST ALL MARKETS
CLEAR FOCUS ON STRATEGIC GROWTH DRIVERS – CONTENT, DIGITAL,
GEOGRPHICAL EXPANSION
ACCELERATING ORGANIC GROWTH BOOSTED BY M&A
RECORD HIGH PAY-OUT RATIO & FINANCIAL FIREPOWER
12
13. MTG INVESTOR RELATIONS
FOR FURTHER INFORMATION
VISIT WWW.MTG.SE
TEL: +46 (0) 73 699 2714
EMAIL: INVESTOR.RELATIONS@MTG.SE
13