PRISA has presented this Tuesday its Strategic Plan 2022-2025, which foresees revenues in the region of 1,000 million euros and a robust improvement in EBITDA margins, thanks chiefly to the upsurge of digital business and an increased contribution from the Latin American and US markets. The Group’s roadmap is set to focus on the growth of its two businesses, PRISA Media and Santillana, on financial stability, on a commitment to innovation and digital transformation and on a firm commitment to sustainability and corporate governance.
According to PRISA’s Chairperson Joseph Oughourlian, “for the first time in the history of the Group, a Strategic Plan has been presented with a commitment to achieving clearly defined results in the medium term. After the restructuring measures adopted in 2021 – with the focus on our stakeholders – and the flexibility provided by the recent refinancing agreement, it is now time to look to the future, to build on the stability achieved both financially and in management, and to focus on growing”.
Oughourlian added that "we have centered all our efforts on the development of our two businesses, which will remain within the perimeter of PRISA, and on promoting our brands, which are already leaders in most of the markets where we operate."
“We have a new business culture – based on innovation and digital transformation – a renewed team, a new structure… and we have the organization's firm commitment to ensuring that PRISA sets the gold standard not just in those sectors where it operates, but also in the field of sustainability. It is time to look to the future with ambition, as we commit to growth and as we demonstrate to the world everything that PRISA can offer when it comes to generating value for society”, he concluded.
Financial stability is one of the main pillars of the Strategic Plan. The recent refinancing agreement is testament to the significant support among creditors for the Group's growth plan. This agreement endows PRISA with the flexibility it needs over the next few years to focus on business development, it extends debt maturity, reduces costs and links financial strategy to Environmental, Social and Governance (ESG) criteria.
The forecasts presented by PRISA envisage revenues in a range of between 950 to 1,050 million euros, which represents cumulative annual growth of between 8% and 9%. The company’s ongoing commitment to boosting its presence in Spanish-speaking markets, as well as to digital transformation, will be reflected in the figures for 2025, when digital revenues are set to climb from 30% to 52% of the total .
Adjusted EBITDA margin will be between 22% and 25%, compared to the figure of 14% reported in 2021. Meanwhile, cost control initiatives will allow the group to keep the expense growth rate below nominal economic growth.
The new financial management culture is focused on operational improvement, cost and investment control and working capital management, thereby favoring the generation of cash flow, an objective that will be reinforced in the coming years along with the reduction of leverage. Indeed, the company estimates that available cash balance will reach 100 million euros in 2025, with cumulative free cash flow set to hit 300 million euros over the period 2022 to 2025.
Regarding the ratio of investments in non-financial assets compared to income, the company expects to maintain a figure of 6%, focusing on investments aimed at the digital transformation of the Group, for which a ratio of 33% is estimated, compared to the current 27%.
The company will focus its actions on business growth, which will be eminently organic and based on the drive for digital transformation and the generation of innovative new content. All this will allow the Group to strengthen the leadership that PRISA already enjoys in the main markets where it operates – chiefly by strengthening its brands and through the expansion of its platforms globally.
Santillana, the leading education company in Latin America, forecasts estimated revenues of between 450 and 550 million euros by 2025. Growth will be supported especially by the private education business, which already accounts for 70% of total revenue, largely due to the Group's firm commitment to subscription models. Indeed, this is an area set to see strong expansion in the years ahead. In this regard, the Group expects to reach 3.4 million digital-subscription-model students in 2025, compared to the current 1.9 million.
Meanwhile, PRISA Media, the leading company in the Spanish-language media sector, forecasts revenues of between 450 and 500 million euros by 2025. The Media arm of the Group bases its growth on three pillars: a firm commitment to digital business, geographic expansion and increased profitability.
The digital business will increase its contribution to total turnover in the Media area very sharply, rising to 41% from the current 24%. The number of subscribers to EL PAÍS will grow from the 177,000 with which it closed 2021 to more than 400,000 in 2025.
PRISA Group's commitment to corporate governance and sustainability
The Strategic Plan presented by the Group redoubles its commitment to corporate governance and sustainability, setting, as it does, new commitments and aligning the management of all of the company's operations with the United Nations Sustainable Development Goals.
The Group had already adopted a range of measures in 2021 that fostered and promoted progress in this direction. The Board of Directors was renewed, with the appointment of eight new directors out of the total of 14. Meanwhile, a cut to Board and senior management remuneration was approved, and the presence of women on the Board and in management was strengthened with the appointment of highly qualified professionals with successful track records. 36% of Board members are women and all the Board committees have a female Chairperson. There is also a female coordinating director.
Faithful to the new corporate focus on generating value for society and in line with PRISA's historical commitment to sustainable growth and the development of a fairer society, the company also recently announced the creation of a Sustainability Committee, with which the Group seeks to take another step forward in this area.
Thus, among the initiatives adopted, the company has set 11 ESG criteria as priorities (two of them linked to the Group's financial management) that promote the development of the five SDGs seen as as priorities and chiefly in areas where company operations have an impact: SDG 4, Quality education; SDG 5, Gender equality; SDG 8, Decent work and economic growth; SDG 13, Climate Action; and SDG 16, Peace, Justice and Strong Institutions.
More than ten years ago, the company joined the UN Global Compact, the world's largest voluntary corporate sustainability initiative, and since 2013 the group has been a member of the Spanish Global Compact Network.
Last September, the Group launched the campaign #DejaBuenaHuella (Leave a Good Mark) across all its media. The Initiative was aimed at reaffirming the company’s commitment to the success of the 2030 Agenda, which was then celebrating its sixth anniversary. It is a commitment and endeavor that the Group now seeks to take much further.
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