07 03 2014 publi groupe fyr 2013
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PubliGroupe Zurich, 07 March 2014 Financial results 2013TRANSCRIPT
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PubliGroupePubliGroupe
Zurich, 07 March 2014Zurich, 07 March 2014
Financial results 2013Financial results 2013
1
Overview presentation order
Agenda item Presenter
Overview of FY 2013 figures, main developments, overview segment results
Arndt C. Groth: CEO
1
Key financials groupAndreas Schmidt: CFO
2
Conclusion & outlook 20143Arndt C. Groth: CEO
2
2
Balanced operating result –net result 2013 of CHF -5.9 million – in line with guidance
Arndt C. Groth Andreas Schmidt
CEO PubliGroupe CFO PubliGroupe
3
Group overviewFull-year results 2013
• Progress made in the second half-year 2013 allowed PubliGroupe to achieve a
balanced operating full-year result; net loss of CHF -5.9 million – results confirm
guidance of Nov. 2013
• Substantially reduced cost base at Media Sales / Publicitas; drop in revenue
due to much higher than expected print market declines in Switzerland;
implementation of strategy on track
• Search & Find, driven by the clear Swiss market leader local.ch, provided solid
operating results, relying on digital, future-oriented revenue
• Zanox net revenue grew by 5%, growth consumed by lower margins in the
affiliate domain and investments in network; growth companies Improve Digital
and Spree7 saw good growth
3
4
1.6
50.2
0.8
-5.9-10
0
10
20
30
40
50
60
Operating result Net Result
2012 2013
285.1267.3
0
100
200
300
2012 2013
Overall performanceFull-year results 2013
Operating and Net Results, in millions of CHF
Net Revenue, in millions of CHF
-6%• Slightly positive break-even operating
result and net loss of CHF -5.9 million
• Persistently difficult market in
Switzerland with loss at Media Sales
main reason for the net loss
• Search & Find, mainly driven by the
market leader local.ch, provided solid
operating results based on digital,
future-oriented revenue
• Operating result of DMS was marked
by substantial development costs at
Improve Digital and Spree7
5
-16.1
22.4
6.1
-11.7-14.5
25.5
-0.5
-9.7
-20
-10
0
10
20
30
Media Sales Search &Find
Digital &MarketingServices
Corporate &Others
2012 2013
Business segment summaryFull-year results 2013
Se
arc
h&
Fin
d
• Definition of strategy & management team
• Achievement of costs reductions: OPEX down
CHF -17.3 million (-11% vs. 2012)
• Implementation of new system solution
(Mediaspectrum)
Co
rpo
rate
&
oth
ers
DM
S
• Successful merger of white & yellow books
• Lower printing costs
• Strong growth in online & mobile
• Investments in young growth enterprises
• 2012 benefited from 6 months of Namics
result
• Continuous FTE reduction at headquarters
• Press investment position positive but lower
in line with weakness of Swiss print market
Me
dia
Sa
les Operating result, in millions of CHF
4
6
FY 2013 digital performanceDigital revenue continues to gain in importance
• Digital revenue grows across the Group in all segments 1
• Overall digital growth of 33% 2
• Media Sales online growth: 3%
• Continuing to focus growth initiatives and investments on digital media
1) Excl. Namics in 20122) Incl. Improve Digital not incl. in 2012
Online revenues in the main associates of PubliGroupe (not consolidated),
in local currency
in millions % 2012 2013
Local 100% (in millions of CHF) 13% 71.7 81.1
Zanox 100% (in millions of EUR) 5% 461.4 486.3
7
Loss at Media Sales; on operating level compensated by Search & Find
Segment Reporting
5
8
-16.1-13.5-14.5 -15.6
-20
-15
-10
-5
0
5
Operating result Net Result
2012 2013
149.4134.6
020406080
100120140160
2012 2013
Media SalesFull-year results 2013
Operating and Net Results, in millions of CHF
Net Revenue, in millions of CHF
-10%
• Net revenue fell by 10%. Billings
dropped from CHF 895.4 million in
2012 to CHF 805.2 million in 2013
• Substantially reduced cost base is
CHF 17.3 million lower than 2012. The
reduction in 2013 resulted from lower
personnel expenses as well as a
reduction of office space
• International business grew by 8% in
net revenue
• At the end of 2013, headcount (FTE) at
847 compared to 1'066 at the end of
2012; 2/3 of reduction in staff from sale
of 51% of xentive to Mediaspectrum
9
Costs reductions in line with lower volumesCost measures of >CHF 17m not sufficient to compensate market decline
1'031895 805
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1'000
1'500
Bil
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gs
, C
HF
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171 157140
0
50
100
150
200
Op
. E
xp
en
se
s
-5.1
-16.1-14.5
(20)
(15)
(10)
(5)
-
Op
. R
es
ult
2011 2012
1) WEMF figures -13.4 % in 2013 vs 2012.Including: daily, regional, weekly, Sunday, finance and business media
2013
• Operational expenses were
reduced by CHF 17.3 million
(minus 11%) against
previous year
• The reduction in 2013
resulted from lower
personnel expenses as well
as reduction of office space
• Stronger than expected
Swiss print market decline;
print net ad volume
excluding magazines and
special publications declines
~ 13% 1
• Strategy in execution,
focusing on necessary
improvement on the top-line
6
10
Strategic pillars
• Appointment of David Klement as CTO, started 2014,
completing the management team. Main responsibility:
development and introduction of Publicitas ad
exchange
• Renewal of partnerships and new partnerships (e.g.,
AZ Medien, CdT, FAO, Arena Cinema, Editoria Abril,
Globo, S1, Sweet Spot, Bloomberg TV & Digital, CBS)
• Implementation of systems solution of Mediaspectrum
on track. NZZ and Le Temps are first key partners
• Centralisation of European and Swiss back-office
• New pricing structure defined and already applied on
ongoing negotiations
• Rightsizing of organisation in Switzerland & Europe
completed resulting in 847 employees worldwide as of
December 2013
First results
Publicitas on track
First results indicate successful implementation of strategy
Full automation
Full portfolio
Variabilisation
Focus
Become efficient and cost
leader in marketing advertising
space
Offer the most relevant media
portfolio to advertisers
“Flexed” cost base to address
contract gains or losses
Focus on core activities
11
103.2115.9
0
20
40
60
80
100
120
2012 2013
Search & FindFull-year results 2013
Operating and Net Results, in millions of CHF
Net Revenue, in millions of CHF
+12%
• Operating result increased by CHF 3.1
million to CHF 25.5 million
• Considering entire (100%) business of
local.ch, the operating result for the
twelve months of 2013 decreased
slightly from CHF 52.6 million in 2012
to CHF 51.7 million in 2013
• Online business reached 41% of
consolidated revenue in 2013 (vs 34%
2012; 29% in 2011)
• At the end of 2013, the headcount
(FTE) was 549, up 37 from the
previous year
22.4
16.6
25.5
16.3
0
5
10
15
20
25
30
Operating result Net Result
2012 2013
7
12
� JV since 1998
�One management since 11/2010
�Rebranding since 2011
Swisscom AG
LTV GelbeSeiten AGSwisscom
Directories AG
local.ch AG
51% 51%49%49%
100%
PUBLIGroupe SA
PubliGroupe & Swisscom
15+ years of successful cooperation
13
Local.chProfitability maintained while shift to online continues
• As of Dec 2013, 2/3 of order intake with digital products
• New local guide a success; merger of print products allow for substantially
lower printing costs
• 4.2 million monthly unique clients
Revenue (consolidation 100%), in millions of CHF
in millions of CHF % 2012 2013
C-Media -20% 86.1 68.8
E-Media 13% 71.7 81.1
Other -3% 51.1 49.7
Total revenue -4% 208.9 199.6
8
14
− Commercial success
- >CHF 200 m revenue on 100% basis
- ~25% EBIT margin
− More local
- city-specific start page
- improved search results
− More offers
− couponing offers
− booking restaurants
− deeper map integration
− Improved usability
− tablet optimised user interface
− autocomplete
− fault tolerance
local.ch: most popular search platform
New offers – extension of market leadership
15
5%10% 10%
16% 17% 18% 19%15%
18% 19%16% 15%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2.0
2.5
3.0
3.5
4.0
4.5
Nov Dez Jan Feb Mar Apr May Jun Jul Aug Sep Oct
loc
al.
ch
s
ea
rch
.ch
[re
l. p
os
itio
n]
Un
iqu
e C
lie
nts
Ne
tMe
trix
[mm
]
2013
1 Source: Unique Netmetrix
local.ch with higher digital reachOutperformed against #2
9
16
local.ch No 1 in Mobile
Uncontested leadership
1 Source: Uniques Netmetrix - registered since Feb/2013
2012 2013
18%
22%25%
22%
17%
23%22%21%
24%26%
21%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
Ja
n
Feb
Mar
Ap
r
May
Ju
n
Ju
l
Au
g
Se
p
Oct
No
v
De
c
Ja
n
Feb
Mar
Ap
r
May
Ju
n
Ju
l
Au
g
Se
p
Oct
No
v
De
c
loc
al.
ch
s
ea
rch
.ch
[re
l. p
os
itio
n]
# u
niq
ue
cli
en
ts[m
m]
17
6.1
15.8
-0.5 -0.2-5
0
5
10
15
20
Operating result Net Result
2012 2013
7.0 6.0
20.7
5.8
0
10
20
30
40
2012 2013
other DMS namics Improve Digital
Digital & Marketing Services Full-year results 2013
Operating and Net Results, in millions of CHF
DMS Net Revenue, in millions of CHF
-57%
• Operating result of CHF -0.5 million vs
CHF 6.1 million in 2012; net revenue
and net result lower due to Namics
sale in June 2012
• Substantial investments at Improve
Digital and Spree7; Improve Digital net
revenue grew 43% to CHF 5.8 million;
Spree7 operational as of July 2013
• At Zanox revenue growth allows to
cement position as leading
performance advertising network in
Europe
• DMS headcount (excluding Zanox) up
from 59 FTE in 2012 to 111 in 2013
27.7
11.8
10.3namics
5.5
10
18
461.4 486.3
0
100
200
300
400
500
600
2012 2013
ZanoxFull-year results 2013
Zanox EBITDA (100%), in millions of EUR
Zanox Net Revenue (100%), in millions of EUR
+5%
• Revenue growth despite competitive
landscape in affiliate domain;
confirmation of top position in Europe;
international expansion continues
• Zanox 5% growth in net revenue and
operational efficiencies largely
consumed by lower margins and
investments in network
• Successful entry into data
management business with
acquisition of Metrigo in 2013
• From a 100% perspective, Zanox net
revenue of EUR 486.3 million in 2013;
EBITDA reached EUR 20.5 million
28.0
20.5
0
5
10
15
20
25
30
2012 2013
19
Improve DigitalLeading European publisher trade technology
Proposition
Joelle Frijters (CEO) Janneke Niessen (CIO)
Clients Financials
Management Team
• #1 European Publisher Ad Exchange and SSP
• Offices in Benelux, Germany, UK, and Spain
• >40 FTE, mostly in tech and sales
• >100 premium publisher customers
• >250 connected demand-side partners, incl. all key DSPs
• State-of-art platform, fully RTA enabled, premium-format, mobile- / video-enabled, customisable private exchange
• Won several awards, including 2013 High Growth Awards, Deloitte Fast 500, Red Herring 100, Inspiring 50
91
75
2013
0.52
2012
0.46
Impressions (in Mill.)
eCPM (EUR)
48
34
20132012
Billing (EUR)
11
20
Spree 7
Transparent trading desk for independent advertising agencies
Proposition
Selection of clients/partners
Management Team
Dirk Fiebig(Vice President Technology &
Operations)
Victor Zawadzki(CEO)
• Young, Berlin-based growth company
• Trading desk for independent agencies and non-agency represented advertising customers
• Exclusive Mediamath partner in DACH
• Small, strong team of dynamic ad trade experts
• Aim to grow trade volumes, data usage, and eventually develop trade platform
Powered by
Milestones
• Fully operational since July 2013
• Signed 26 agencies to date, aiming to get to 50 in 2014
• Ran more than 100 campaigns in past 6 months; about 20-50 campaigns per month at present
• Strong focus and good progress on analytics / data
21
Key financials Group
Andreas Schmidt
CFO PubliGroupe
12
22
P&L Group
Net loss vs. large profit in 2012
* Billings represent the gross amounts billed to clients (including the value of ad space)
in millions of CHF 2013 2012
Billings * -7% 1'058.0 1'134.6
Net revenue -6% 267.3 285.1
Purchases 32% -22.5 -17.1
Gross profit -9% 244.8 268.0
Operating Expenses -9% -263.1 -289.0
Depr. & Amort. -6% -4.5 -4.8
Share in associates -14% 23.6 27.4
Operating result -48% 0.8 1.6
Financial result -98% - -1.8
Ordinary result - 0.8 -0.2
Non-operating result -96% 2.7 66.1
Income taxes -67% -4.0 -12.0
Minority interests 46% -5.4 -3.7
Net Result - -5.9 50.2
Headcount (FTE) -137 1'565 1'702
23
Non-operating resultPractically no non-operating items in 2013
in millions of CHF 2013 2012
Gain on Namics sale - 10.3
Gain on SOP sale - 3.1
Gain on xentive sale 0.4 -
Real Estate - Gain on sale - 49.6
Real Estate - Rental inc./Cost & depr on properties 2.4 4.4
Other (mainly rent elimination) -0.1 -1.3
Non-operating result 2.7 66.1
13
24
Operating result by segment
Higher Search & Find profit allows break-even result
in millions of CHF 2013 2012
Media Sales -14.5 -16.1
Search & Find 25.5 22.4
Digital & Marketing Services -0.5 6.1
Corporate & Others -9.7 -11.7
Eliminations Group - 0.9
Operating result 0.8 1.6
25
Headcount by segmentFewer FTEs at Media Sales and Group
End December End December
FTE 2013 2012
Media Sales 847 1'066
Search & Find 549 512
Digital & Marketing Services 111 59
Corporate & Others 58 65
Total Headcount 1'565 1'702
14
26
Financial Result
Balanced result 2013
in millions of CHF 2013 2012
Interest income 0.9 0.5
Income from marketable securities and investments 2.5 1.3
Financial income 3.4 1.8
Interest expenses -1.9 -1.3
Loss on marketable securities and investments -1.1 -1.5
Financial expenses -3.0 -2.8
Net currency exchange differences -0.4 -0.8
Net financial Result - -1.8
27
Cash flow statementSubstantially lower cash position due to share buy-back, dividend & loss
in millions of CHF 2013 2012
Cash and cash equivalents as of 1 January 162.2 109.3
Cash flows from operating activities -21.7 22.0
Cash flows from investing activities -30.8 63.1
Cash flows from financing activities -52.3 -31.8
Effect of exchange rates on cash and cash equivalents -0.9 -0.4
Cash and cash equivalents as of 31 December 56.5 162.2
• Reasons for lower operating cash: 1/3 growth-related , 1/3 market conditions-related; 1/3 one-time effects
• Reasons for lower investing cash:mainly financing of Digital Window acquistion by Zanox
• Reasons for lower financing cash: extraordinary dividend payment and share buy-back
15
28
Group balance sheet
Reduced balance sheet after share buy-back
as of 31 December as of 31 December
in millions of CHF 2013 2012
Current assets 292.4 379.2
Non-current assets 163.7 153.0
Total assets 456.1 532.2
Current liabilities 286.9 250.9
Non-current liabilities 22.4 72.6
Equity, shareholders of PubliGroupe Ltd 135.0 195.6
Minority interests 11.8 13.1
Total liabilities and equity 456.1 532.2
Equity in % of assets 30% 37%
29
Conclusion & Outlookby the CEO
Arndt C. Groth
CEO PubliGroupe
16
30
• Lean and focused HQ
structure to control and
very selectively support
assets
• Operational efficiencies
realised within key
assets
• Divestment of non-core
assets
• Focus on technology-
oriented companies in
the media & advertising
sector
�
Accomplishments since 2012Progressing along three distinct paths
1.
Streamlining of
operations
2.
Focusing on
core assets
3.
Developing
tech-orientedassets
• Reduction of overhead costs; currently 29 FTE at
headquarters in Lausanne, further reductions planned
• Appointment of new CEO at Publicitas with turnaround
experience; continued rightsizing at Media Sales
• At local.ch/Zanox efficiency programs in place, with
effects to be realised in 2014 and 2015
• Sale of 3 buildings in Bern & Lausanne
• Sale of Namics, IT consultancy firm
• Sale of 51% of Xentive to Mediaspectrum, Boston-
based company offering premier software solutions
• Sale of further non-strategic assets planned
• Acquisition of Improve Digital, leading European
supply-side platform operator
• Successful acquisition of data management platform
(DMP) Metrigo through Zanox
• Establishment of Spree7 together with MediaMath as
a leading demand-side platform (DSP) provider that
caters to marketers’ media buying needs
• Establishment of automated media marketplace at
Publicitas, together with Mediaspectrum
�
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ongoing
ongoing
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ongoing
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31
Key agenda points General Assembly 2014
• The Board of Directors decided to schedule the introduction of the principle
of "one share – one vote" for the Annual General Meeting to be held on 29
April 2014
• At the next Annual General Assembly (AGM), the Board will propose an
adaptation of the Articles of Association in conformity with the "Ordinance
Against Excessive Compensation in Listed Companies“
• The Board of Directors will propose a dividend of CHF 2.0 per share,
resulting in a dividend payment of about CHF 4.4 million
• Further details will be communicated with the invitation to the General
Meeting in the beginning of April
17
32
Conclusion and Outlook
Full year results 2013
• Progress made in the second half-year 2013 allowed PubliGroupe to achieve a
balanced operating full-year result
• Divestment of non-core assets or assets that are not providing satisfactory
financial returns will continue as will the adaptation of the holding
• In particular at Publicitas, the further execution of strategy of an increasingly
automated sales platform across all media categories, as announced in August
2013, remains the key focus in order to return to the path of profitability
• In 2014 Search & Find should provide results in the same order of magnitude
as 2013; DMS will slightly improve its results. At Zanox several measures are
in place to capitalize on its leading market position
• PubliGroupe will maintain focus on building a Group of leading advertising
technology-oriented companies
33
Backup Slides
18
34
Consolidated income statement Backup
* Billings represent the gross amounts billed to clients (including the value of ad space)
in millions of CHF 2013 2012
Billings * 1'058.0 1'134.6
Net revenue 267.3 285.1
Purchases -22.5 -17.1
Gross profit 244.8 268.0
Personnel expenses -183.9 -211.6
General and administrative expenses -81.1 -78.8
Depreciation of tangible assets -2.2 -3.8
Amortisation of intangible assets -2.3 -1.0
Other operating income 2.3 1.9
Other operating expenses -0.4 -0.5
Share in result of associates 23.6 27.4
Operating result 0.8 1.6
Financial result - -1.8
Ordinary result 0.8 -0.2
Non-operating result 2.7 66.1
Result before income taxes and minority interests 3.5 65.9
Income taxes -4.0 -12.0
Result before minority interests -0.5 53.9
Minority interests -5.4 -3.7
Result attributable to shareholders of PubliGroupe Ltd -5.9 50.2
Earnings per share (in CHF) -2.7 21.2
35
Consolidated balance sheetAssets
Backup
as of 31 December as of 31 Decemberin millions of CHF 2013 2012
Cash and cash equivalents 56.5 162.2
Marketable securities 13.5 12.9
Trade receivables 172.9 167.4
Other receivables 30.1 20.9
Accrued income and prepaid expenses 19.4 15.8
Current assets 292.4 379.2
Investment properties 32.7 34.0
Owner-occupied properties 0.6 0.1
Equipment 4.8 7.0
Intangible assets 4.1 5.0
Investments in associates 79.5 79.3
Financial assets 39.3 25.3
Deferred tax assets 2.7 2.3
Non-current assets 163.7 153.0
Total assets 456.1 532.2
19
36
Consolidated balance sheetLiabilities and equity
Backup
as of 31 December as of 31 Decemberin millions of CHF 2013 2012
Current debts 42.6 0.9
Trade payables 114.3 122.2
Other payables 26.5 29.3
Accrued expenses and deferred income 97.7 89.5
Current provisions 5.8 9.0
Current liabilities 286.9 250.9
Non-current debts 0.2 40.3
Share in negative equity of associates 12.3 22.8
Deferred tax liabilities 3.9 2.2
Non-current provisions 6.0 7.3
Non-current liabilities 22.4 72.6
Total liabilities 309.3 323.5
Share capital PubliGroupe Ltd 2.3 2.5
Treasury shares -34.5 -35.0
Capital reserves -0.3 -0.3
Retained earnings 167.5 228.4
Equity, shareholders of PubliGroupe Ltd 135.0 195.6
Minority interests 11.8 13.1
Total equity 146.8 208.7
Total liabilities and equity 456.1 532.2
37
Cash flows from operating activities Backup
in millions of CHF 2013 2012
Result before minority interests -0.5 53.9
Share in result of associates -23.6 -27.4
Depreciation and amortisation (incl. non-operating) 5.5 6.1
Changes in provisions (incl. deferred income taxes) -2.7 2.7
Gain/loss on disposals of fixed assets 0.1 -49.7
Gain/loss on disposals of subsidiaries and associates -0.4 -13.4
Adjustments for other non-cash items 2.8 13.4
Dividends received 16.7 21.6
Interest received 0.6 0.4
Interest paid -1.6 -1.4
Taxes paid -5.2 -5.6
Changes in trade receivables -7.1 25.3
Changes in other receivables, accrued income and prepaid expenses -9.7 12.2
Changes in trade payables -8.8 -14.0
Changes in other payables, accrued expenses and deferred income 12.2 -2.1
Cash flows from operating activities -21.7 22.0
20
38
Cash flows from investing activities Backup
in millions of CHF 2013 2012
Acquisitions of tangible assets -1.2 -2.9
Disposals of tangible assets - 81.4
Acquisitions of intangible assets -5.5 -1.4
Acquisitions of subsidiaries, net of cash acquired -0.2 -16.1
Disposals of subsidiaries, net of cash disposed of - 6.9
Acquisitions and capital increases in associates -7.6 -
Disposals of associates - 3.7
Investments in financial assets -17.3 -4.1
Divestments of financial assets 5.4 -
Taxes paid -4.4 -4.4
Cash flows from investing activities -30.8 63.1
39
Cash flows from financing activities Backup
in millions of CHF 2013 2012
Increase in bank debts 2.4 -
Repayment of bank debts -0.9 -
Repayment of non-current debt -0.3 -10.2
Purchase of treasury shares -25.2 -1.8
Sale of treasury shares 0.2 1.1
Increase in capital reserves - 0.1
Decrease in capital reserves - -5.2
Dividend paid to shareholders of PubliGroupe Ltd -22.1 -8.9
Dividends paid to minority interests by Group companies -6.4 -6.9
Cash flows from financing activities -52.3 -31.8