results 2005 annual investors‘ and analysts‘ conference fileresults 2005 annual investors‘ and...
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Results 2005 Annual Investors‘ and Analysts‘ ConferenceGuillaume de Posch, Chief Executive OfficerLothar Lanz, Chief Financial Officer, Legal Affairs & Human ResourcesPeter Christmann, Marketing & Sales
Munich, February 21, 2006
Page 2
TV advertising market 2005
2005 financial statements (IFRS)
Outlook for 2006
Appendix
Record year 2005
Agenda
Page 3
Record earnings in the history of the Group.ProSiebenSat.1 Group boosts revenue, EBITDA and earnings significantly.
Pre-tax profit
7.
EBITDA
Revenues Consolidatedprofit
EBITDAmargin
Earningsper share*
*per preferred shareFigures 2005 preliminary and unaudited
EUR1,989.6 Mio +8.4%
EUR418.5 Mio +30%
EUR350.7 Mio
+61%
EUR220.9 Mio +65%
21.0 % +20%
1.02 EUR +59%
ProSiebenSat.1 Group: Record Year 2005
Page 4
ProSiebenSat.1 Group: Strengthening of core business Free TV
The Group has reached in 2005 the best audience share in five years.Audience share (14-49) ProSiebenSat.1 Group* in 2002 – 2005 (in percent)
*Sat.1, ProSieben, kabel eins, N24Source: AGF/GfK Fernsehforschung / SevenOne Media
30.3
29.4
28.9
28.1
27
28
29
30
31
2002 2003 2004 2005
+0.8% points
+0.5% points
+0.9% points
Page 5
ProSiebenSat.1 Group: Top programming in 2005
Top five formats of the stations in 2005.Audience share (14 to 49 age group)
1. Verliebt in Berlin (up to 26.4%)2. Die Luftbrücke - Nur der Himmel war frei (up to 31.0%)3. Schillerstraße (up to 24.0%)4. Das Gespenst von Canterville (26.1%)5. Promi ärgere Dich nicht (21.9%)
1. Spiderman (36.8%)2. Men in Black II (32.3%)3. Desperate Housewives (up to 23.1%)4. Das große TV total Turmspringen 2005 (26.5%) 5. Galileo Spezial: Tsunami (27.0%)
1. Ein Frage der Ehre (11.1%)2. Al Bundy night (10.2%)3. Spurlos verschwunden – Without a Trace (up to 10.0%)4. Die besten Filmsongs aller Zeiten (up to 7.3%)5. Leuchtturmbau (up to 9.1%)
1. Livecoverage of the "Discovery" landing (4.6%)2. Livecoverage of the results of the Michael Jackson trial (3.3%)3. Special report on the Rudolph Moshammer murder (3.7%)4. N24 tsunami special "Die Welle des Todes" (2.3%)5. Kronzuckers Kosmos (up to 6.0%)
Source: AGF/GfK-Fernsehforschung, SevenOne Media
Page 6
124.5112.7
25.122.1
0
30
60
90
120
150
180
2004 2005
ProSiebenSat.1 Group: Diversification expanded
Diversification with significant increases due to organic growth and the acquisition of 9Live.External revenues and EBITDA (in EUR m)
Diversification without 9Live Diversification including 9Live
+11%
9Live is consolidated since June 1, 2005. Figures 2005 preliminary and unaudited
178.5
112.7
39.1
22.1
0
30
60
90
120
150
180
2004 2005
+14%+77%
+58%
External revenues EBITDA
Page 7
CallTV/AudiotexAcquisition of 9LiveNew Call TV shows on Sat.1, kabel eins and ProSieben
OnlineICQ messenger deal: ProSieben content on the ICQ portal Acquisition of majority stake in wetter.comLaunch of a VoD portal on T-Online
ProSiebenSat.1 Group: Diversification expanded
New business models and cooperations drive diversification. Further growth by acquisitions.
New diversification initiatives 2005
New BusinessMusic: Joint-Venture with Warner Music GroupCo-branding models with O2Betting (Austria)Home entertainment (DVD)
Pay TVLaunch of ProSiebenSat.1 WeltAcquisition of majority stake in wetter.com’s weather channel
MobileLaunch of UMTS content with Vodafone, T-Mobile and O2
OthersFoundation of SevenOneInternational as international program sales
Page 8
ProSiebenSat.1 Group: Achievements 2005
The ProSiebenSat.1 Group has reached the goals it had set for 2005.
1. Revenues and earnings up. Further improvement of profitability in a stagnant TV advertising market with stable costs
2.
3
2. Further growth of audience and advertising market share of the group
1.
3. Reduction of the dependency on the TV advertising market by expansion of diversification revenues to nine percent of total revenues
2.
3
4. Sat.1, kabel eins and N24 enhance profitability significantly
Page 9
TV advertising market 2005
2005 financial statements (IFRS)
Outlook for 2006
Appendix
Record year 2005
Agenda
Page 10
TV advertising market Germany: Gross revenues 2005
ProSiebenSat.1 Group shows highest growth of advertising revenues.Gross advertising revenues 2005 vs. 2004 (in EUR m)
ProSiebenSat.1 Group: Sat.1, ProSieben, kabel eins, N24. RTL Group: RTL, Vox, Super RTL, n-tvSource: Nielsen Media Research
3,281.13,501.6
2,909.6 3,002.4
500.2 498.0 397.9 351.6
0
500
1000
1500
2000
2500
3000
3500
4000
ProSiebenSat.1 Group
RTL Group RTL II ARD/ZDF
20042005
+6.7%
+3.2%
-0.4% -11.6%
Gross TV advertisingrevenues total:
+4.2 percent
Page 11
TV advertising market Germany: Gross revenues
TV advertising market with increase in the second half of 2005.Gross advertising revenues 2005 vs. 2004, comparison of half years (in EUR m)
ProSiebenSat.1 Group: Sat.1, ProSieben, kabel eins, N24. RTL Group: RTL, Vox, Super RTL, n-tvSource: Nielsen Media Research
1,5841,396
221 206
1,640
181244
1,377
192279
1,514
1,697
254
1,625
1,861
170
0
500
1000
1500
2000
ProSiebenSat.1 Group RTL Group RTL II ARD/ZDF
H1 2004H1 2005H2 2004H2 2005
+3.5%
-1.4%
+9.7%
+10.4%
+7.3%
-9.0% -11.5% -12.1%
Page 12
TV advertising market Germany: Top 10 TV ad sectors
Food industry is the most important industry for TV advertising in 2005. Gross TV advertising spendings by sector in 2005 (in EUR m)
Source: Nielsen Media Research
8,046.7
740.6
940.4
1,483.0
672.6
661.2
635.9
517.5
437.3
378.3
342.0
0 300 600 900 1200 1500 1800
Cleaning
Retail & Mail Order
Finance
IT & Communication
Services
Transport & Cars
Beverages
Media
Personal Care
Food
TV advertising total 8,046.7
Page 13
TV advertising market Germany: Top 10 drivers 2005
Service industry leads TV ad growth with an increase of 20 percent.Top 10 sectors according to growth of TV advertising spendings (in EUR m)
Source: Nielsen Media Research
35.7
54.6
105.9
30.9
29.0
25.4
23.0
21.8
21.1
20.8
0 20 40 60 80 100 120
Food
Building Industry
Home & Garden
Pharmacy
Textile & Clothing
IT & Communication
Cleaning
Audio & Video
Beverages
Services
Revenues Changes2005 2004/2005
635.9 20.0%
672.6 8.8 %
89.7 65.9 %
342.0 9.9 %
517.5 5.9 %
93.2 37.5 %
276.0 9.1 %
100.5 27.8 %
77.0 37.6 %
1,483.0 1.4 %
Page 14
TV market in Germany: Net advertising expenditure
TV net advertising investments 2005 at 1997/1998 level.German TV net advertising investments (in EUR bn)
Source: ZAW, 2005e: ProSiebenSat.1 estimate
3.873.863.80
4.04
4.32
4.71
4.47
3.96
3.81
3,5
3,75
4
4,25
4,5
4,75
5
1997 1998 1999 2000 2001 2002 2003 2004 2005*
+9.1% -5.1% -11.5% -3.7% +1.3%+6.8%+6.3% 0.0 – 0.5*
Page 15
TV advertising market 2005
2005 financial statements (IFRS)
Outlook for 2006
Appendix
Record year 2005
Agenda
Page 16
ProSiebenSat.1 Group: Record year 2005
ProSiebenSat.1 Group with record pre-tax profit in 2005.ProSiebenSat.1 Group revenues and pre-tax profit 2001 to 2005 (in EUR m)
1,989.6
1,834.61,807.1
1,895.1
2,014.8
1500
1600
1700
1800
1900
2000
2100
2001 2002 2003 2004 2005
Revenues Pre-tax profit
Figures 2005 are preliminary and unaudited. 2001/2002 according to German GAAP, from 2003 IFRS
350.7
217.5
61.1
21.4
105.6
0
50
100
150
200
250
300
350
400
2001 2002 2003 2004 2005
Page 17
ProSiebenSat.1 Group: Record year 2005
Revenues increase by organic growth and the acquisition of 9Live.Revenues and costs 2005 vs. 2004 (in EUR m)
1,989.6
1,834.6
1500
1600
1700
1800
1900
2000
2100
2004 2005*
1,620.31,576.9
1500
1600
1700
1800
1900
2000
2100
2004 2005**
Revenues Costs
+8.4%
+2.8%
Figures 2005 preliminary and unaudited. *Thereof 9Live: EUR 54.0 m. **Thereof 9Live: EUR 37.9 m
Page 18
35.1
200.6
957.6
135.0184.0
1,265.5
34.8
212.6
947.2
127.4
210.1
1,275.2
Cost of sales Selling expenses Administrative expenses
Programming assets Personnelexpenses**
Depreciation andamortization**
Moderate cost increase despite acquisition of 9Live in 2005. ProSiebenSat.1 Group total costs by line item in 2005 vs. 2004 (in EUR m)
+0.8% +14.2% +6.0% +6.0%-1.1%
Figures 2005 preliminary and unaudited. *Included in cost of sales. **Included in cost of sales, selling expenses and administrative expenses
-0.9%
consumption*
ProSiebenSat.1 Group: Costs
Total cost increase:EUR 43.4 m
(thereof 9Live: EUR 37.9 m)
2004
2005
Page 19
321.3
418.5
0
100
200
300
400
500
2004 2005*
217.5
350.7
0
100
200
300
400
500
2004 2005**
ProSiebenSat.1 Group: Earnings
ProSiebenSat.1 Group with significant increase in EBITDA and pre-tax profit in 2005.EBITDA and pre-tax profit of ProSiebenSat.1 Group 2005 vs. 2004 (in EUR m)
+30.3%
EBITDA
+61.2%
Pre-tax profit
Figures 2005 preliminary and unaudited. *Thereof 9Live: EUR 18.6 m. **Thereof 9Live: EUR 16.6 m
Page 20
133.6
220.9
0
50
100
150
200
250
300
2004 2005*
0.64
1.02
0,0
0,5
1,0
1,5
2004 2005
ProSiebenSat.1 Group: Consolidated profit/EPS
ProSiebenSat.1 Group increases the consolidated profit up to 65.3 percent in 2005.Consolidated profit (EUR m) and earnings per preferred share (EUR) ProSiebenSat.1 Group 2005 vs. 2004
+65.3%
Consolidated profit
+59.4%
Earnings per share
Figures 2005 preliminary and unaudited. *Thereof 9Live: EUR 16.8 m
Page 21
ProSiebenSat.1 Group: Revenues
Revenue increase in the fourth quarter due to growth of advertising revenues.Revenues ProSiebenSat.1 Group 2005 vs. 2004, comparison of quarters (in EUR m)
436.2496.0
362.1
540.3
636.0
415.9
507.8
429.9
0
100
200
300
400
500
600
700
800
Q1 Q2 Q3 Q4
2004
2005
Figures 2005 preliminary and unaudited
-1.4%
+2.4%
+14.9%
+17.7%
Page 22
112.2
21.7
118.3
69.1
167.8
59.9
126.6
64.2
0
50
100
150
200
Q1 Q2 Q3 Q4
2004
2005
Record EBITDA for ProSiebenSat.1 Group.EBITDA ProSiebenSat.1 Group 2005 vs. 2004, comparison of quarters (in EUR m)
ProSiebenSat.1 Group: 2005 financial statements
Figures 2005 preliminary and unaudited
-7.1%
+7.0%
+176.0%
+49.6%
Page 23
0.5x
ProSiebenSat.1 Group: Net financial debt
0
100
200
300 RCF
400325
200*
July 2009 2021
45.5Mortgages
NotesNotes
* First call exercisable in July 2006 (premium: 5.625%)
Reduction of net debt despite higher dividends and 9Live acquisition.Net debt ProSiebenSat.1 Group 2005 vs. 2004 (in EUR m)
Net debt/LTM-EBITDA0.9x
Current long-term credit ratings:
Moody‘s: Ba1 (Developing)
Fitch: BBB- (Positive outlook)
April 2009 May 2009
150
Debt instrumentsas per December 31, 2005
227.2
278.7
0
100
200
300
400
31.12.2004 31.12.2005
-18.5%
Figures 2005 preliminary and unaudited
Page 24
ProSiebenSat.1 Group: 2005 financial statements
Key Figures2005 2004
EUR m EUR m EUR m percent
Revenues 1,989.6 1,834.6 155.0 8.4
EBITDA 418.5 321.3 97.2 30.3
EBIT 382.7 285.2 97.5 34.2
Financial result -33.0 -68.7 35.7 52.0
Pre-tax pofit 350.7 217.5 133.2 61.2
Consolidated profit 220.9 133.6 87.3 65.3Earnings per share of preferred stock acc. to IAS (EUR) 1.02 0.64 0.38 59.4
Programming investments 907.3 923.4 -16.1 -1.7
Free cashflow* 70.1 122.8 -52.7 -42.9
Total assets 2,016.6 2,059.2 -42.6 -2.1
Shareholders' equity 1,187.7 1,004.1 183.6 18.3
Equity ratio 58.9% 48.8% -/- 20.7
EBITDA margin 21.0% 17.5% -/- 20.0
Net financial debt incl. Bond 227.2 278.7 -51.5 -18.5
Net financial debt/LTM-EBITDA 0.5x 0.9x -0.4 -44.4
Employees (averaging full-time equivalent jobs) 2,788 2,699 -/- 3.3
Changes
Figures 2005 are preliminary and unaudited. *Post acquisition of 9Live
Page 25
ProSiebenSat.1 Group: 2005 financial statements
Subline [Arial 14, bold, schwarz]Weitere Zeile für Erläuterungen [Arial 14, light, schwarz].Results per segment (in EUR m)
2005 2004 % 2005 2004 % 2005 2004 % 2005 2004 %
Free TV 1,860.0 1,757.1 +5.9 1,811.1 1,721.9 +5.2 379.0 299.0 26.8 353.6 267.0 +32.4
Transaction TV 54.9 -/- -/- 54.0 -/- -/- 14.0 -/- -/- 8.0 -/- -/-
Other diversification 135.0 119.2 +13.3 124.5 112.7 +10.5 25.1 22.1 +13.6 21.5 18.8 +14.4
Revenues Operating profitEBITDAExternal revenues
Figures 2005 preliminary and unaudited
Page 26
ProSiebenSat.1 Group: 2005 financial statements
Subline [Arial 14, bold, schwarz]Weitere Zeile für Erläuterungen [Arial 14, light, schwarz].Station Results (in EUR m)
2005 2004 % 2005 2004 % 2005 2004 %
Sat.1 830.9 773.9 +7.4 161.3 97.8 +64.9 161.0 89.7 +79.5
ProSieben 751.7 749.9 +0.2 165.6 175.5 -5.6 167.1 175.1 -4.6
kabel eins 223.3 192.9 +15.8 46.6 26.5 +75.8 47.0 27.3 +72.2
N24 83.0 73.2 +13.4 10.0 2.8 +257.1 9.4 1.8 +422.2
Revenues Pre-tax profitEBITDA
Figures 2005 preliminary and unaudited
Page 27
TV advertising market 2005
2005 financial statements (IFRS)
Outlook for 2006
Appendix
Record year 2005
Agenda
Page 28
Outlook 2006: Core business TV
GDP and consumer demand in real terms. Source: Statistisches Bundesamt, *2006: Wirtschaftsforschungsinstitute
Consumer demandReal GDP
Experts expect a slight improvement of the economy and private consumption in 2006.Development of GDP and private consumption 1999 to 2006 (in percent)
-0.5
0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
1999 2001 2003 20052000 2002 2004 2006e*
%
2.0
3.2
1.2
0.1 -0.2
1.6
0.9
1.4 - 1.7
-0.5
0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
%
3.0
2.4
1.9
-0.5 0.1
0.6
0.0
0.2 - 0.5
1999 2001 2003 20052000 2002 2004 2006e*
Page 29Source: ZAW, WARC, Zenith Optimedia
2
-1.7
0.710.8 0.6
1.3
3.1
1.8
2.6
-2
-1
0
1
2
3
4
WARC Zenith ZAW WARC Zenith
2005
2006
Advertising market in total TV advertising market
Forecasts for the advertisng market and the TV advertising market in Germany.Net figures, in percent
Outlook 2006: Core business TV
Page 30
Outlook 2006: Core business TV
ProSiebenSat.1 Group expects the German net TV advertising market to grow by 2 percent in 2006. Net TV advertising investments, changes from previous year (in percent)
Source: ZAW, *ProSiebenSat.1 estimates
2.00.0 - 0.51.3
-3.7
-11.5
-5.1
9.16.8
-15
-10
-5
0
5
10
15
1999 2000 2001 2002 2003 2004 2005e* 2006e*
Page 31
Outlook 2006: Core business television
Programming for 2006: Highlights of the stations
"Verliebt in Berlin" and a subsequent telenovela"Das Wunder von Bern"Comedies like "Schmitz komm raus!"Series and cycles like "Allein unter Bauern"Shows like "Promi ärgere Dich nicht!"
"Arabella Kiesbauer" "Studio 24" – Stories from Germany with Claudia Eberl (Current affairsmagazine with stories from Germany from 27.02.06)"Make Money" (AT) (New stock market show)
Blockbusters like "Fluch der Karibik"International premium series like "Grey's Anatomy"Entertainment events like "Germanys Next Topmodel by Heidi Klum"The accessprime highlight "Lotta in Love"More science e.g. with "Galileo Extra" and new BBC co-productions
"Die besten Filme aller Zeiten", e.g. "Der Mann in der eisernen Maske""Medium" – The US top serie as Free TV premiere in Germany"4 Flügel, Küche, Bad" – kabel eins builds a windmill"Quiz Taxi" – The slightly different quiz show with Thomas Hackenberg"Ultimate Desasters" – Four part international docu-co-production
Source: AGF/GfK-Fernsehforschung, SevenOne Media
Page 32
Outlook 2006: Digital
Signal protection
Expansion of reach
New revenuesources
Digital Rights Management to secure license requirementsEncryption of basic package
Addition distribution, additional reach for ProSiebenSat.1 channels
Share of feesShare of Pay revenues
Offers via DSLStreaming of stations: Sat.1, ProSieben, kabel eins, N24, 9LivePlanned: Pay channels of the Group: Sat.1 Comedy, kabel eins Classics
ProSiebenSat.1 Group has signed a contract with DSL provider Telefonica and is negotiating withother DSL providers.
Page 33
ProSiebenSat.1 Group: Strategic goals for 2006
Increase of revenues and earnings
Audience market share of around 30 percent (14-49)despite sports yearStrengthening of theposition in the TV advertising market
Strengthening of thecore business TV
Expansion of diversification Positioning for the digital world
Organic growthand acquisitionsIncreasing of thediversification up to morethan 12 percent
Launch of two Pay TV channels (Q2 2006)Program sales via DSL(IPTV/Vod)
Leading commercial TV Group in Germany
Page 34
TV advertising market 2005
2005 financial statements (IFRS)
Outlook for 2006
Appendix
Successes in fiscal 2005
Agenda
Page 35
German TV market: Ratings
Development of audience market shares.Audience share (14 to 49 age group) 2003 to 2005 (in percent)
RTL Group: n-tv: 50.0%, RTL II: 35.9%, Super RTL: 50.0%; Vox: 99.7% Source: RTL GroupSource: AGF/GfK Fernsehforschung / pc#tv aktuell / SevenOne Media
30.3%
12.1%
11.6%
5.2% 5.5%
0.5%0.8%
2004 2005
29.4%
16.8% 16.0%
5.5% 6.4%
2.5% 2.7%
0.6%0.5%
2004
7.5% 6.5%
2004 2005
25.3% 25.7%
8.8% 8.1%
8.0%7.3%
2004 2005
16.8%15.4%
11.7%
12.3%
2005
7.5%6.5%12.0%
11.5%
4.9%
0.5%
2003
18.2%
5.0%
2.3%
0.6%
2003
26.1%
7.1%
2003
7.1%
8.7%
7.6%
2003
16.3%
28.9%
Page 36
ProSiebenSat.1 Group: 2005 financial statements
Key FiguresQ4 2005 Q4 2004
EUR m EUR m EUR m percent
Revenues 636.0 540.3 95.7 17.7
EBITDA 167.8 112.2 55.6 49.6
EBIT 156.8 104.7 52.1 49.8
Financial result -10.0 -9.0 -1.0 -11.1
Pre-tax profit 147.9 95.9 52.0 54.2
Consolidated profit 96.9 58.3 38.6 66.2Earnings per share of preferred stock acc. to IAS (EUR) 0.44 0.26 0.18 69.2
Programming investments 253.9 199.2 54.7 27.5
Free cashflow 162.7 166.7 -4.0 -2.4
Total assets 2,016.6 2,059.2 -42.6 -2.1
Shareholders' equity 1,187.7 1,004.1 183.6 18.3
Equity ratio (percent) 58.9% 48.8% -/- 20.7
EBITDA margin (percent) 26.4% 20.8% -/- 26.9
Net financial debt incl. Bond 227.2 278.7 -51.5 -18.5
Net financial debt/LTM-EBITDA 0.5x 0.9x -0.4 -44.4
Employees (averaging full-time equivalent jobs) 2,855 2,667 -/- 7.0
Changes
Figures 2005 are preliminary and unaudited
Page 37
ProSiebenSat.1 Media AG: Shareholder structure
SabanCapitalCompanies
Alpine Equity Partners
Bain Capital Investors
Hellman&
Friedman
Providence Equity Partners
Putnam Invest-ments
Quadrangle Group
Thomas H. Lee Partners
ProSiebenSat.1 Media AG
P7S1 Holding L.P.Axel Springer AG
100%
Free Float
German Media Partners L.P.
88.0% Voting shares
13.0% Preference shares
50.5% Share capital
12.0% Voting shares
12.0% Preference shares
12.0% Share capital
0.0% Voting shares
75.0% Preference shares
37.5% Share capital
Page 38
ProSiebenSat.1 Media AGCorporate Office Medienallee 7D-85774 UnterföhringPhone +49/89/95 07-11 80Fax +49/89/95 07-11 84