PRISA first quarter 2015 highlights
20-04-2015
Adjusted EBITDA at constant currency (61.8 million Euros) increases by 15.2%.
- Adjusted advertising increases in 1Q 2015 compared to 1Q 2014: Spain by +10.2%, Portugal by 0.8% and Latam by 4%
- In LatAm: Santillana has had excellent performance in South Area campaigns, while Radio still shows weakness in Chile and Colombia, offset by good performance in Mexico
- Control of cost and capex continues to be a priority across all business areas
Focus on refinancing plan execution:
- 63 million Euro of debt cancelled with 25% discount
- Capital increase of 75 million Euros at 0.53 € per share pending formalization
Advertising in Spain continues its recovering in 1Q 2015
- Group adjusted advertising revenues in Spain increase by +10.2% in 1Q 2015.
- Radio in Spain grows by 14.1%, increasing in both local (+16.7%) and national (+6.2%) advertising.
- Press consolidates the change in trend shown in 4Q 2014, growing in 1Q 2015 by +7%, (+0.2% offline; 21% online).
- In Portugal, Media Capital advertising revenues, grow by +0.8% (+0.7% in TVI, +2.2% in MC Radio).
LatAm activities continue favourable evolution
- In Education, South Area campaigns have favourably developed, showing a local currency growth of +10.3%.
- In Radio, local currency revenues stay almost flat (-0.2%). Continued weakness in Chile and Colombia, offset by good performance in Mexico (+29%).
- FX evolution throughout the year has had a positive impact of 9.9 million euros on adjusted revenues, and of 6.2 million euros on adjusted EBITDA.
The Group accelerates digital transformation
- Digital transformation revenues increase by 51% and reach 56.3 million euros.
- Digital education systems (UNO) continue their development in Latin America improving margins significantly reaching 772,583 students.
- Adjusted digital advertising grows by 14.9% during the year.
- In the press division, digital advertising already represents 33% of advertising revenues.
- Average unique browsers to the Group’s web sites grow by 21.8% reaching more than 98 million as of February (latest data available).
Opex and capex control continues
- Operating expenses have fallen meaningfully in Press and Media Capital, while increases in cost in Education and Radio are revenue related increases.
- Adjusted personnel expenses stay almost flat growing by 0.5 million euros (Group Total, +0.5%; Spain, -6.6%; Portugal, -7.7% and LatAm, +14.6%).
- Capex has been reviewed to channel resources to growth areas, mainly Santillana.
The Group continues with its focus on the execution of the refinancing plan
- Sale of 14.8 million Mediaset España shares.
- 63 million euros debt reduction with a c. 25% discount debt buyback with funds coming from Mediaset Spain stake sale.
- 75 million euros capital increase at 0.53 € per share pending administrative formalization.
- Canal+ operation is following its due administrative course, waiting for regulatory approval.
- Total Group net debt reduced to 2,406 million as of March 31st 2015, comparing to 2,582 million as of December 31st 2014.
Results by business division
- During 1Q South Area campaigns are under way: Brazil, Colombia, Costa Rica, North Central America, Uruguay, Chile, Bolivia, Argentina, Paraguay, Peru and Ecuador. These campaigns have mostly shown good performance in local currency.
- We highlight Brazil, which has shown good behaviour generally, with growth of +9% in local currency and Argentina showing an extraordinary growth of +60% in local currency.
- North Area campaigns (Spain, Mexico and Venezuela mainly), take place during 2H every year, and therefore 1Q 2015 results are not representative in 1Q.
- Digital education systems (UNO) continue their development in Latin America, significantly improving their profitability. EBITDA of 2.2 million euros in 1Q 2015 vs. 1.1 million euro in 1Q 2014.
- Exchange rate in 1Q 2015 has had a favourable impact of 8.8 million on Santillana revenues and of 6 million euros on adjusted EBITDA.
- Adjusted revenue in local currency increased by +9.7% (Brazil, 9%; Chile, -6%; Argentina, 60%).
- Adjusted EBITDA grows by 22.2% in local currency (+36.4% in euros).
- Adjusted advertising in Spain grows by +14.1% in 1Q 2015.
- Advertising in LatAm is weakened by Chile and Colombia performance, offset by a good evolution in Mexico.
- Continued effort in cost control, however the increase in 1Q 2015, as a result of new programming promotion and revenue related expenses (+5.8% in adjusted expenses). Personnel cost remains flat (+0.5%).
- Remarkable operational improvement in Spain, where adjusted EBITDA increases in 1Q 2015 to 2.4 million euros from a negative EBITDA of -0.9 million euros in 1Q 2014.
- Positive FX impact (1.1 million euros on revenues and 0.1 million on EBITDA).
- Radio LatAm adjusted revenues in local currency, grow by +6.3% in 1Q 2015 versus 1Q 2014.
- Adjusted EBITDA in Radio in 1Q 2015 reached 7.4 million euros (+32.5% compared to 1Q 2014), and 7.3 million euro adjusted for FX (+30%).
- Adjusted advertising revenues in 1Q 2015 increase by 7% (El País 8.2% y AS 8.8%).
- Traditional advertising revenues stop falling for the second consecutive quarter (+0.2%), Digital advertising revenues grow by +21% (reaching 33% of the divisional advertising revenues). Additionally, revenues from new business (event management) grow by +8.5%.
- We highlight the strength of AS where digital advertising revenues grow by 16.8% and already make up for 58% of total advertising revenue.
- Circulation revenues fall by -13.6%.
- Strong cost control in every item (-9.4% in adjusted terms and -7.4% in staff costs).
- Tax deductions for 2 million euros were recorded in 1Q 2014 but not in 1Q 2015.
- Adjusted EBITDA (including deductions) is -0.7 million euros in 1Q 2015 compared to 2.8 million euros in 1Q 2014.
- Advertising Revenues increase in1Q 2015 by +0.8% (TV, +0.7%; Radio, +2.2%). It has to be said that advertising recovery in Portugal started in second half of 2013).
- Decline in other revenues in 1Q 2015 (-12.9%), mainly due to the drop in value added call services.
- Adjusted EBITDA reaches 6.2 million euros and grows by 9.5 % on the back of effort in costs control (decrease of -7.2% in adjusted costs).
Consolidated P&L
The comparison of the results of the first quarter of 2015 and 2014 is affected by extraordinary items recorded in revenues, expenses, amortizations & provisions. To conduct a homogeneous comparison, we are presenting a profit and loss account adjusting these extraordinary items:
|
JANUARY - MARCHE |
Eur Million |
2015 |
2014 |
% Chg. |
Operating Revenues |
336,43 |
337,50 |
(0,3) |
EBITDA |
55,82 |
37,64 |
48,3 |
EBITDA Margin |
16,6% |
11,2% |
|
EBIT |
32,86 |
8,46 |
|
EBIT Margin |
9,8% |
2,5% |
|
Net financial result |
(13,27) |
(45,36) |
70,8 |
Interest on debt |
(27,52) |
(33,82) |
18,6 |
Other financial results |
14,25 |
(11,55) |
|
Result from associates |
0,81 |
(3,65) |
122,2 |
Profit before tax |
20,41 |
(40,56) |
150,3 |
Income tax expense |
(5,60) |
10,22 |
(154,8) |
Results from discontinued activities |
0,64 |
(21,55) |
103,0 |
Minority interest |
(6,77) |
4,32 |
|
Net profit |
8,68 |
(47,57) |
118,3 |
Adjusted Operating Revenues |
341,92 |
323,58 |
5,7 |
Adjusted EBITDA |
67,95 |
53,65 |
26,7 |
Adjusted EBITDA margin |
19,9% |
16,6% |
|
Adjusted EBIT |
44,69 |
27,91 |
60,1 |
Adjusted EBIT margin |
13,1% |
8,6% |
|
Results at constant currency |
2015 |
2014 |
% Chg. |
Operating revenues at cosntant currency |
332,04 |
323,58 |
2,6 |
EBITDA at cosntant currency |
61,79 |
53,65 |
15,2 |
Adjusted EBITDA margin |
18,6% |
16,6% |
|
EBIT at cosntant currency |
38,61 |
27,91 |
38,3 |
Adjusted EBIT margin |
11,6% |
8,6% |
|
During 1Q 2015, excluding extraordinary items and exchange rate impact:
- Operating revenue grow by 2.6%
- Adjusted EBITDA grow by 15.2%.
- The improvement in margins continues.
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