GROUP QUARTERLY STATEMENT AS AT 30 SEPTEMBER
2019
CONTENT
BUSINESS PERFORMANCE | 1 |
OVERVIEW OF KEY GROUP FIGURES | 2 |
EARNINGS PERFORMANCE | 4 |
FINANCIAL POSITION | 7 |
CASH FLOW | 9 |
SIGNIFICANT EVENTS IN THE REPORTING PERIOD | 10 |
EVENTS AFTER THE BALANCE SHEET DATE | 10 |
OUTLOOK | 11 |
RISK AND OPPORTUNITIES REPORT | 12 |
Consolidated balance sheet | 13 |
Consolidated income statement | 15 |
Consolidated statement of comprehensive income | 16 |
Consolidated income statement (1 July - 30 September 2019) | 17 |
Consolidated statement of comprehensive income (1 July - 30 September 2019) | 18 |
Consolidated statement of changes in equity | 19 |
Consolidated cash flow statement (short form) | 20 |
Contact, Publishers' notes, Disclaimer | 21 |
II
CTS EVENTIM REPORTS SIGNIFICANT INCREASE IN REVENUE AND EARNINGS IN FIRST NINE MONTHS
Group revenue exceeds one billion Euro in nine months for the first time ever
Group revenue up 16.5% at EUR 1,074.6 million, normalised EBITDA up 26.5% at EUR 177.0 million
Strong growth and improved EBITDA margins in both Ticketing and Live-Entertainment
Number of tickets sold online grows by 9.2%
Strong performance in the Live Entertainment segment due to successful major tours and events
Group continues to expect growth in both revenue and earnings for 2019
The CTS Group, one of the leading international providers of ticketing services and live entertainment, achieved significant growth in revenue and earnings in the first nine months of this year. Group revenue rose year-on-year by 16.5% to EUR 1,074.6 million (previous year: EUR 922.5 million), while normalised EBITDA advanced 26.5% to EUR 177.0 million (previous year: EUR 140.0 million). Normalised EBITDA margin climbed to 16.5%, compared to 15.2% the year before. The Ticketing and Live Entertainment segments both contributed to these growth rates.
Klaus-Peter Schulenberg, CEO of CTS EVENTIM, commented that 'CTS EVENTIM is on course to achieve the targets for the 2019 financial year. Thanks not only to a very successful third quarter, we significantly improved our online ticketing volume in the first nine months. The fact that we continue to sell more and more tickets through digital channels has positive and long-term impacts on our margins. Our Live Entertainment segment also performed very strongly in the period under review. The establishment of our promoter network, EVENTIM LIVE, is opening up additional avenues for us in this field. Our aim is to offer international tour opportunities to artists from all over the world. By taking a stake in France's market leader, France Billet, we have also achieved a major and strategic step forward in the Ticketing segment. In this way, CTS EVENTIM is extending and reinforcing its market position in a commercially attractive and culturally diversified market.'
In the Ticketing segment, revenue increased by 11.0% in the first nine months to EUR 306.9 million (previous year: EUR 276.5 million). This was mainly attributable to a significant increase in online ticketing volume: no fewer than
- million tickets were sold on the CTS EVENTIM webshops alone - a year-on-year growth of 9.2% (previous year:
- million). Normalised EBITDA rose 16.7% to EUR 119.2 million (previous year: EUR 102.1 million). The normalised EBITDA margin climbed to 38.8% (previous year: 36.9%).
Revenue in the Live Entertainment segment was up 19.0%, at EUR 781.4 million (previous year: EUR 656.6 million), thus exceeding expectations. The normalised EBITDA rose disproportionately by 52.7% to EUR 57.8 million (previous year: EUR 37.9 million). The normalised EBITDA margin climbed to 7.4% (previous year: 5.8%). Major tours put on by various EVENTIM LIVE promoters in Germany, and newly acquired promoters abroad, were among the factors spurring this growth. The venues operated by CTS EVENTIM - especially the LANXESS arena in Cologne, the Waldbühne in Berlin and the K.B. Hallen newly opened in Copenhagen in 2019 - also showed successful business growth.
1 Group Quarterly Statement
OVERVIEW OF KEY GROUP FIGURES
TICKETING | 01.01.2019 | 01.01.2018 | Change | |||
- 30.09.20191 | - 30.09.2018 | |||||
[EUR'000] | ||||||
[EUR'000] | [EUR'000] | [in %] | ||||
Revenue | 306,859 | 276,544 | 30,315 | 11.0 | ||
EBITDA 2 | 117,507 | 100,634 | 16,872 | 16.8 | ||
EBITDA margin | 38.3% | 36.4% | 1.9 pp | |||
Normalised EBITDA | 119,189 | 102,108 | 17,081 | 16.7 | ||
Normalised EBITDA margin | 38.8% | 36.9% | 1.9 pp | |||
EBIT 2 | 91,917 | 78,820 | 13,097 | 16.6 | ||
EBIT margin | 30.0% | 28.5% | 1.5 pp | |||
Normalised EBIT before amortisation | ||||||
from purchase price allocation | 98,887 | 86,831 | 12,056 | 13.9 | ||
Normalised EBIT margin | 32.2% | 31.4% | 0.8 pp | |||
LIVE ENTERTAINMENT | 01.01.2019 | 01.01.2018 | Change | |||
- 30.09.20191 | - 30.09.2018 | |||||
[EUR'000] | ||||||
[EUR'000] | [EUR'000] | [in %] | ||||
Revenue | 781,397 | 656,611 | 124,786 | 19.0 | ||
EBITDA 3 | 57,042 | 37,321 | 19,721 | 52.8 | ||
EBITDA margin | 7.3% | 5.7% | 1.6 pp | |||
Normalised EBITDA | 57,792 | 37,852 | 19,940 | 52.7 | ||
Normalised EBITDA margin | 7.4% | 5.8% | 1.6 pp | |||
EBIT 3 | 42,442 | 32,612 | 9,830 | 30.1 | ||
EBIT margin | 5.4% | 5.0% | 0.5 pp | |||
Normalised EBIT before amortisation | ||||||
from purchase price allocation | 45,879 | 34,718 | 11,160 | 32.2 | ||
Normalised EBIT margin | 5.9% | 5.3% | 0.6 pp | |||
- The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
- Ticketing effect of IFRS 16: EBITDA EUR +5,190 thousand; EBIT EUR +220 thousand
- Live Entertainment effect of IFRS 16: EBITDA EUR +8,978 thousand; EBIT EUR +653 thousand
2 Group Quarterly Statement
CTS GROUP | 01.01.2019 | 01.01.2018 | Change | |||
- 30.09.20191 | - 30.09.2018 | |||||
[EUR'000] | ||||||
[EUR'000] | [EUR'000] | [in %] | ||||
Revenue | 1,074,573 | 922,538 | 152,035 | 16.5 | ||
EBITDA 2 | 174,548 | 137,955 | 36,593 | 26.5 | ||
EBITDA margin | 16.2% | 15.0% | 1.3 pp | |||
Normalised EBITDA | 176,981 | 139,961 | 37,020 | 26.5 | ||
Normalised EBITDA margin | 16.5% | 15.2% | 1.3 pp | |||
Depreciation and amortisation | -40,189 | -26,524 | -13,665 | 51.5 | ||
EBIT 2 | 134,359 | 111,432 | 22,928 | 20.6 | ||
EBIT margin | 12.5% | 12.1% | 0.4 pp | |||
Normalised EBIT before amortisation | ||||||
from purchase price allocation | 144,766 | 121,550 | 23,216 | 19.1 | ||
Normalised EBIT margin | 13.5% | 13.2% | 0.3 pp | |||
Financial result | -7,035 | 2,161 | -9,197 | -425.5 | ||
Earnings before tax (EBT) | 127,324 | 113,593 | 13,731 | 12.1 | ||
Net income attributable to shareholders | 72,278 | 63,444 | 8,834 | 13.9 | ||
[EUR] | [EUR] | [EUR] | ||||
Earnings per share 3, undiluted (= diluted) | 0.75 | 0.66 | 0.09 | 13.9 | ||
[Qty.] | [Qty.] | [Qty.] | ||||
Internet ticket volume (in million) | 36.8 | 33.7 | 3.1 | 9.2 | ||
Employees 4 | 2,882 | 2,692 | 190 | 7.1 | ||
- The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
- Effect of IFRS 16: EBITDA EUR +14,168 thousand; EBIT EUR +874 thousand
- Number of shares: 96 million
- Number of employees at end of period (active workforce)
3 Group Quarterly Statement
EARNINGS PERFORMANCE
REVENUE PERFORMANCE
In the Ticketing segment revenue rose in the first nine months to EUR 306,859 thousand (+11.0%). This was largely due to a significant increase in the online ticket volume: the CTS EVENTIM's web shops alone sold 36.8 million tickets, an increase of 9.2% over the previous year (33.7 million). The share of revenue generated by foreign subsidiaries was at 45.4% (previous year: 46.7%).
Revenue in the Live Entertainment segment grew to EUR 781,397 thousand (+19.0%) exceeding expectations. The increase in revenue mainly results from a successful tour business and the expansion of the scope of consolidation.
In the CTS Group, this resulted in an increase in revenue in both segments by EUR 152,035 thousand (+16.5%) to EUR 1,074,573 thousand.
NON-RECURRING ITEMS
In the period under review, CTS Group earnings were negatively impacted due to non-recurring items in the Ticketing segment amounting to EUR 1,683 thousand (previous year: EUR 1,474 thousand) and in the Live Entertainment segment amounting to EUR 750 thousand (previous year: EUR 531 thousand) due to implemented and planned acquisitions (primarily legal and consulting fees for the performance of due diligence) as well as consulting costs in connection with the strategic redirection of business units.
NORMALISED EBITDA / EBITDA
CTS GROUP | 01.01.2019 | 01.01.2018 | Change | |||
- 30.09.20191 | - 30.09.2018 | |||||
[EUR'000] | ||||||
[EUR'000] | [EUR'000] | [in %] | ||||
EBITDA | 174,548 | 137,955 | 36,593 | 26.5 | ||
Non-recurring items | 2,433 | 2,005 | 427 | 21.3 | ||
Normalised EBITDA | 176,981 | 139,961 | 37,020 | 26.5 | ||
Depreciation and amortisation | -40,189 | -26,524 | -13,665 | 51.5 | ||
Thereof amortisation from purchase price allocation | 7,974 | 8,113 | -139 | -1.7 | ||
Normalised EBIT before amortisation | ||||||
from purchase price allocation | 144,766 | 121,550 | 23,216 | 19.1 | ||
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
4 Group Quarterly Statement
Normalised EBITDA in the Ticketing segment increased by EUR 17,081 thousand (+16.7%). The main driver was a further increase in online ticket volume. Additional positive impacts on earnings resulted from the adoption of IFRS 16 (EUR 5,190 thousand) and from the services performed in the project for the collection of the German infrastructure charge (EUR 3,100 thousand). Normalised EBITDA margin rose to 38.8% compared to 36.9% in the previous year. The share of normalised EBITDA attributable to foreign companies increased year-on-year from 34.3% to 35.1% in the current reporting period. EBITDA increased from EUR 100,634 thousand by EUR 16,872 thousand to EUR 117,507 thou- sand. The EBITDA margin improved to 38.3% (previous year: 36.4%).
Normalised EBITDA in the Live Entertainment segment increased significantly by EUR 19,940 thousand (+52.7%). Positive impacts came among other things from major tours with large audiences at various EVENTIM LIVE pro moters in Germany and at newly acquired promoters abroad. The attractive range of events at our venues LANXESS arena in Cologne, Waldbühne Berlin and the newly opened K.B. Hallen in Copenhagen are further success factors for the segment. The adoption of IFRS 16 (EUR 8,978 thousand) resulted in additional positive earnings effects. Nor- malised EBITDA margin increased to 7.4% (previous year: 5.8%). EBITDA increased from EUR 37,321 thousand by EUR 19,721 thousand to EUR 57,042 thousand. The EBITDA margin rose to 7.3% (previous year: 5.7%).
Normalised CTS Group EBITDA increased by EUR 37,020 thousand or 26.5%. The normalised EBITDA margin of 16.5% was above the previous year's level of 15.2%. The adoption of IFRS 16 resulted in an additional positive earnings effect of EUR 14,168 thousand. Foreign subsidiaries accounted for 22.4% of normalised EBITDA (previous year: 25.6%). EBITDA increased from EUR 137,955 thousand by EUR 36,593 thousand to EUR 174,548 thousand. The EBITDA margin is 16.2% (previous year: 15.0%).
FINANCIAL RESULT
The financial result changed from EUR 2,161 thousand by EUR -9,197 thousand to EUR -7,035 thousand. Besides the interest expenses recognised for the first time due to the adoption of IFRS 16 (EUR -1,097 thousand) an updated fair value measurement of a variable purchase price obligation from share purchase agreements already concluded (EUR -2,533 thousand) was recognised. In the same period last year, increased financial income (EUR +3,532 million) resulted from an updated fair value measurement on liabilities from put options granted to minority shareholders.
The financial result includes income of EUR -105 thousand from the operating company accounted at equity.
EARNINGS BEFORE TAX (EBT) / NET INCOME ATTRIBUTABLE TO SHAREHOLDERS / EARNINGS PER SHARE (EPS)
In the reporting period, EBT increased from EUR 113,593 thousand by EUR 13,731 thousand to EUR 127,324 thousand.
After deduction of tax expenses and compared to the prior year lower non-controlling interests, net income attributable to the shareholders amounted to EUR 72,278 thousand (previous year: EUR 63,444 thousand). EPS was above previous year's level at EUR 0.75 (previous year: EUR 0.66).
5 Group Quarterly Statement
IMPACT OF THE ADOPTION OF IFRS 16
The adoption of IFRS 16 within the Group had a positive effect on EBITDA/normalised EBITDA of EUR 14,168 thou- sand. This effect was offset by EUR 13,295 thousand in depreciation (in Ticketing of EUR 4,970 thousand and in Live Entertainment of EUR 8,325 thousand). Adoption of IFRS 16 thus results in a positive EUR 874 thousand effect on EBIT/normalised EBIT, before amortisation from purchase price allocation at Group level. After interest expenses amounting to EUR -1,097 thousand and deferred taxes of EUR 62 thousand, the effect on the net income for the period is EUR -162 thousand.
PERSONNEL
Compared to the previous year, personnel expenses in the CTS Group increased from EUR 112,039 thousand by EUR 10,921 thousand to EUR 122,960 thousand. The increase in personnel expenses relates to the Live Entertainment segment with EUR 5,025 thousand and the Ticketing segment with EUR 5,896 thousand. The increase in the Live Entertainment segment primarily resulted from the expansion of the number of companies included in consolidation. The increase in the Ticketing segment is due to the further expansion of the workforce in line with business develop- ment, the implementation of technological development and expanding internationalisation.
On average, the companies in the CTS Group had a total of 2,977 employees (previous year: 2,774 employees) includ-
ing part-time workers on their payroll. Of that total, 1,698 are employed in the Ticketing segment (previous year: 1,659
employees) and 1,279 in the Live Entertainment segment (previous year: 1,115 employees).
6 Group Quarterly Statement
FINANCIAL POSITION
MAIN CHANGES IN ASSETS COMPARED TO 31 DECEMBER 2018
Cash and cash equivalents in the CTS Group decreased by EUR 306,481 thousand. The change in cash and cash equivalents comprises the seasonal reduction in cash and cash equivalents in the Ticketing segment due to paid out ticket monies and lower advance payments received in the Live Entertainment segment. In addition, payments to the capital reserve and the issue of loans to the operating company for the collection of the infrastructure charge accounted for at equity (Joint Venture) and dividend payments to shareholders in the second quarter of 2019 led to a cash outflow.
Cash and cash equivalents include ticket monies from presales for events in subsequent quarters (ticket monies not yet invoiced, primarily in the Ticketing segment), which are reported under other financial liabilities at EUR 287,249 thousand (31.12.2018: EUR 422,842 thousand); other financial assets also include receivables relating to ticket monies from presales mainly in the Ticketing segment (EUR 72,225 thousand; 31.12.2018: EUR 87,085 thousand) and factoring receivables (EUR 14,010 thousand; 31.12.2018: EUR 25,262 thousand).
The payments on account relate to already paid production costs (e.g. artist fees) for future events. The decrease of EUR 17,643 thousand is mainly due to major tours performed in the third quarter of 2019.
The decrease in current other financial assets (EUR -31,705 thousand) mainly results from the decrease in receivables relating to ticket revenue from presales (EUR -14,860 thousand) and factoring receivables (EUR -11,252 thou- sand) in the Ticketing segment.
The increase in current other non-financialassets (EUR +11,474 thousand) mainly includes increased VAT receivables.
Property, plant and equipment increased by EUR 141,647 thousand mainly due to the adoption of IFRS 16. According to IFRS 16 the right of use in property, plant and equipment (primarily venues and office buildings) amounting to EUR 141,484 thousand are capitalised.
The increase in investments in associates accounted for at equity (EUR +10,398 thousand) mainly results from payments to the capital reserve of the operating company for the collection of the infrastructure charge.
The non-currentother financial assets (EUR +16,681 thousand) mainly increased due to loan receivables from the operating company for the collection of the infrastructure charge.
MAIN CHANGES ON THE EQUITY AND LIABILITY SIDE COMPARED TO 31 DECEMBER 2018
The current advance payments received (EUR -172,508 thousand) mainly decreased due to the performance of events.
The decline in current other financial liabilities (EUR -139,890 thousand) is mainly attributable to the reduction of liabilities from ticket monies not yet invoiced in the Ticketing segment. Due to the strong fourth quarter at the end of the year, there is usually a large amount of liabilities for ticket monies not yet invoiced, which is then reduced in the course of the following year, when the events are held and invoiced.
7 Group Quarterly Statement
The current lease liabilities (EUR +16,644 thousand) increased due to the adoption of IFRS 16.
The increase in non-currentlease liabilities (EUR +124,886 thousand) results from the adoption of IFRS 16.
Equity increased by EUR 17,303 thousand to EUR 488,591 thousand. The positive consolidated net income is offset by a dividend payment to shareholders. The equity ratio (equity divided by the balance sheet total) rose to 31.5% (31.12.2018: 27.3%).
8 Group Quarterly Statement
CASH FLOW
The amount of cash and cash equivalents shown in the cash flow statement corresponds to the cash and cash
equivalents stated in the balance sheet. Compared to the closing date as of 31 December 2018, cash and cash equivalents decreased by EUR 306,481 thousand to EUR 566,725 thousand.
In comparison to the closing date as of 30 September 2018 cash and cash equivalents increased by EUR 82,599 thou- sand. The increase results from higher cash and cash equivalents as of 1 January 2019 (EUR 873,206 thousand) compared to the previous year (01.01.2018: EUR 640,726 thousand). Due to the seasonally high ticket sales in the fourth quarter of 2018, cash and cash equivalents increased to EUR 232,480 thousand.
The decrease in cash flow from operating activities compared to the same period in the prior year (01.01.-30.09.2018) from EUR -64,074 thousand by EUR -105,436 thousand to EUR -169,510 thousand mainly resulted from higher reductions in liabilities for ticket monies in the Ticketing segment and from advance payments received in the Live Entertainment segment. Whereas in the fourth quarter of 2018 positive cash flow effects resulted from an increase in ticket monies in the Ticketing segment and from advance payments received in the Live Entertainment segment due to presales for events attracting large audiences, the reduction in liabilities in respect of ticket monies in the Ticketing segment and holding the events in the Live Entertainment segment led to a negative cash flow effect in the 2019 reporting period. Negative cash flow effects also resulted from the payment of higher taxes on income.
Owing to the seasonally very high level of ticket presales in the fourth quarter, there is usually a large amount of liabilities in respect of ticket monies as at 31 December that have not yet been invoiced in the Ticketing segment, which leads in the course of the following year to cash outflows of ticket monies to promoters due to many events being held and invoiced.
The negative cash flow from investing activities increased year-on-year from EUR -2,323 thousand by EUR -44,206 thousand to EUR -46,529 thousand. In the reporting year, outflows of capital for payments into capital reserves and the issue of a loan to a company accounted for at equity (operating company for the collection of the infrastructure charge) had a negative impact of EUR 25,658 thousand on cash flow. In the same period of the previous year, the cash flow was still mainly enhanced by proceeds from disposals of financial assets and by the takeover of cash and cash equivalents in connection with the acquisition of consolidated companies.
The negative cash flow from financing activities increased year-on-year from EUR -90,481 thousand by EUR -1,920 thousand to EUR -92,401 thousand. In a year-on-year comparison, reduced repayments of the syndicated credit line (revolving credit facility) resulted in a positive cash flow effect. On the other hand, negative cash flow effects resulted from the repayment of leasing liabilities following the adoption of IFRS 16.
With its current financial resources, the CTS Group is able to meet its financial commitments and to finance its planned investments and ongoing operations from its own funds.
9 Group Quarterly Statement
SIGNIFICANT EVENTS IN THE REPORTING PERIOD
In the judgement it handed down on 18 June 2019, the Court of Justice of the European Union (CJEU) declared that a tax relief planned in connection with the introduction of the infrastructure charge ('car toll') violates the European law. As a result, the Federal Government stopped the introduction of the 'car toll'.
On 19 June 2019, the Federal Ministry for Transport and Digital Infrastructure gave notice that it was terminating the contract with the operating company to collect the infrastructure charge with effect from 30 September 2019. The compensation claim from the project after termination of the contract with the operating company has not yet been quantified.
EVENTS AFTER THE BALANCE SHEET DATE
At the beginning of October, the CTS Group has acquired 51% of the shares in the Russian tour and concert promoter Talent Concert International o.o.o., Moscow (hereinafter: TCI). TCI becomes part of the promoter network EVENTIM LIVE, which thus now also has a presence in the Russian market.
The CTS Group has significantly strengthened its position in France by acquiring a stake in the country's ticketing market leader France Billet. CTS EVENTIM and Fnac Darty (owner of France Billet) have successfully concluded their negotiations, ongoing since end of July, regarding a strategic partnership for their French ticketing activities and signed the contracts at the end of October. As planned, in a first step the CTS Group acquired 48% of the shares in France Billet. At the same time, the company will merge its existing activities in France into the partnership. In addition the CTS Group has the option to acquire a majority share in the Joint Venture four years after completion of the transaction.
On 14 November 2019, the KPS Stiftung, based in Hamburg, sold 4,200,000 shares in CTS EVENTIM AG & Co. KGaA (4.375% of the voting rights). The KPS Stiftung now holds 38.827% of the voting rights in CTS EVENTIM AG & Co. KGaA.
10 Group Quarterly Statement
OUTLOOK
EXPECTED EARNINGS PERFORMANCE
In the first nine months of the current financial year, the CTS Group achieved higher levels of revenue and earnings in both the Ticketing and Live Entertainment segment. This growth in revenue and earnings in both segments gained pace in the second and third quarter, thus documenting that the company's business model continues to be successful and robust. The corporate management expects higher revenue and improved earnings figures for 2019 as a whole compared to the prior year.
To continue this strategy in the future, the CTS Group will systematically pursue its growth strategy. This involves organic growth from continuous improvement of ticketing solutions and the development of additional innovative ser- vices, for example in the field of e-commerce and information science. The company will also push its growth strategy forward by making further acquisitions, as indicated by the recently completed participation in France Billet, the French provider of ticketing services.
The CTS Group is also continuing to grow in the Live Entertainment segment. The company is ready to expand its promoter network EVENTIM LIVE, launched this year, to further promoters. In early October 2019, the company announced the majority takeover of Talent Concert International (TCI), thereby entering the Russian live entertainment market. The aim of EVENTIM LIVE is to offer international artists the opportunity to tour internationally. In addition, CTS EVENTIM and the promoters of EVENTIM LIVE are continuously investing in new content formats.
GENERAL STATEMENT ON THE EXPECTED DEVELOPMENT OF THE GROUP
CTS KGaA holds a 50% stake in the operating company for collecting the German infrastructure charge 'car toll', a Joint Venture which is accounted for using the equity method. At the end of December 2018, the operating company received the task for the construction of an infrastructure survey system and an infrastructure charge, for a duration of minimum 12 years, by the Federal Motor Vehicle Office. Due to complexities involved in accounting for the contract in accordance with IFRS, no final budgeting for the revenue and earnings effects of the project in 2019 was available when the 2018 Annual Report was published, which meant that the forecasts for the 2019 financial year were made at that time without taking the effects of the project 'car toll' into consideration.
An updated forecast for the 2019 financial year, based on a preliminary estimate of revenues and earnings for the 'car toll' project, was published with the report for the first quarter of 2019.
At the end of June, the Federal Ministry for Transport and Digital Infrastructure gave notice that it was terminating the contract between the federal government and the operating company for collecting the German infrastructure charge with effect from 30 September 2019.
Due to termination of the contract between the federal government, the operating company and the subcontractor in the CTS Group the contractually owed services were reassessed. The investment income from the operating company, accounted for at equity, was also revised.
The claim to payment for handling the project after termination of the contract with the operating company, which has yet to be quantified, has not been taken into account in the updated forecast for 2019.
Based on the positive business developments in the CTS Group in the reporting period, no significant changes are expected of the estimated Group development in the 2019 financial year according to the quarterly statement as at 31 March 2019, despite the changed contract situation in the project 'car toll'.
11 Group Quarterly Statement
RISK AND OPPORTUNITIES REPORT
Against the backdrop of the existing risk management systems, risk exposure is limited and manageable in the CTS Group. No risks are evident that could endanger the continuation of the Group as a going concern.
Risks and opportunities exist, among others, in the handling of major customer projects and IT projects. In connection with the major customer project/IT project 'car toll', we refer to the general statement on the Group's expected development in the outlook.
Beyond that, the statements made in the Risk and Opportunity Report 2018 are still valid.
12 Group Quarterly Statement
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
AS AT 30 SEPTEMBER 2019
ASSETS | 30.09.20191 | 31.12.2018 | |
[EUR'000] | [EUR'000] | ||
Current assets | |||
Cash and cash equivalents | 566,725 | 873,206 | |
Marketable securities and other investments | 4,285 | 3,385 | |
Trade receivables | 64,360 | 62,050 | |
Receivables from affiliated and associated companies accounted for at equity | 329 | 563 | |
Inventories | 4,759 | 5,397 | |
Payments on account | 57,466 | 75,109 | |
Receivables from income tax | 4,299 | 7,136 | |
Other financial assets | 107,270 | 138,975 | |
Other non-financial assets | 36,405 | 24,931 | |
Total current assets | 845,898 | 1,190,752 | |
Non-current assets | |||
Goodwill | 324,709 | 320,763 | |
Other intangible assets | 124,461 | 130,194 | |
Property, plant and equipment | 175,050 | 33,403 | |
Investments | 2,958 | 1,739 | |
Investments in associates accounted for at equity | 29,202 | 18,803 | |
Trade receivables | 58 | 156 | |
Receivables from affiliated and associated companies accounted for at equity | 0 | 66 | |
Other financial assets | 27,321 | 10,640 | |
Other non-financial assets | 2,400 | 2,606 | |
Deferred tax assets | 17,313 | 15,986 | |
Total non-current assets | 703,471 | 534,355 | |
1,549,369 | |||
Total assets | 1,725,107 | ||
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
13 | Group Quarterly Statement | Consolidated Balance Sheet |
EQUITY AND LIABILITIES | 30.09.20191 | 31.12.2018 | |
[EUR'000] | [EUR'000] | ||
Current liabilities | |||
Financial liabilities | 34,035 | 38,960 | |
Trade payables | 140,755 | 138,939 | |
Payables to affiliated and associated companies accounted for at equity | 562 | 743 | |
Advance payments received | 217,393 | 389,901 | |
Other provisions | 5,122 | 7,924 | |
Tax debts | 51,639 | 59,297 | |
Other financial liabilities | 303,451 | 443,341 | |
Lease liabilities | 16,710 | 66 | |
Other non-financial liabilities | 67,662 | 75,987 | |
Total current liabilities | 837,328 | 1,155,157 | |
Non-current liabilities | |||
Financial liabilities | 60,618 | 66,339 | |
Advance payments received | 2,533 | 522 | |
Other provisions | 4,196 | 4,196 | |
Other financial liabilities | 2,043 | 11 | |
Lease liabilities | 124,997 | 110 | |
Pension provisions | 11,904 | 8,857 | |
Deferred tax liabilities | 17,160 | 18,626 | |
Total non-current liabilities | 223,450 | 98,662 | |
Equity | |||
Share capital | 96,000 | 96,000 | |
Capital reserve | 1,890 | 1,890 | |
Statutory reserve | 7,200 | 7,200 | |
Retained earnings | 347,814 | 335,098 | |
Other reserves | -2,896 | -1,652 | |
Treasury stock | -52 | -52 | |
Total equity attributable to shareholders of CTS KGaA | 449,955 | 438,483 | |
Non-controlling interests | 38,636 | 32,805 | |
Total Equity | 488,591 | 471,289 | |
Total Equity and liabilities | 1,549,369 | 1,725,107 | |
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
14 | Group Quarterly Statement | Consolidated Balance Sheet |
CONSOLIDATED INCOME STATEMENT FOR THE PERIOD FROM 1 JANUARY TO 30 SEPTEMBER 2019
01.01.2019 | 01.01.2018 | ||
- 30.09.20191 | - 30.09.2018 | ||
[EUR'000] | [EUR'000] | ||
Revenue | 1,074,573 | 922,538 | |
Cost of sales | -810,394 | -704,556 | |
Gross profit | 264,179 | 217,982 | |
Selling expenses | -76,695 | -67,605 | |
General administrative expenses | -53,634 | -48,880 | |
Other operating income | 20,158 | 21,711 | |
Other operating expenses | -19,649 | -11,776 | |
Operating profit (EBIT) | 134,359 | 111,432 | |
Income / expenses from participations | 342 | 455 | |
Income / expenses from investments in associates accounted for at equity | 362 | 1,608 | |
Financial income | 687 | 4,091 | |
Financial expenses | -8,427 | -3,993 | |
Income before tax (EBT) | 127,324 | 113,593 | |
Taxes | -46,419 | -36,282 | |
Net income | 80,905 | 77,311 | |
Net income attributable to | |||
Shareholders of CTS KGaA | 72,278 | 63,444 | |
Non-controlling interests | 8,627 | 13,867 | |
Earnings per share (in EUR), undiluted (= diluted) | 0.75 | 0.66 | |
Average number of shares in circulation, undiluted (= diluted) | 96 million | 96 million | |
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
15 | Group Quarterly Statement | Consolidated Income Statement |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD FROM 1 JANUARY TO 30 SEPTEMBER 2019
01.01.2019 | 01.01.2018 | ||
- 30.09.20191 | - 30.09.2018 | ||
[EUR'000] | [EUR'000] | ||
Net income | 80,905 | 77,311 | |
Remeasurement of the net defined benefit obligation for pension plans | -2,460 | 858 | |
Items that will not be reclassified to profit or loss | -2,460 | 858 | |
Exchange differences on translating foreign subsidiaries | 1,992 | 1,647 | |
Change in the fair value of derivatives in cash flow hedges | -27 | 13 | |
Share of other comprehensive income (exchange differences) of investments accounted for | |||
using the equity method | 167 | 13 | |
Items that will be reclassified subsequently to profit or loss when specific conditions are met | 2,131 | 1,673 | |
Other results (net) | -329 | 2,531 | |
Total comprehensive income | 80,576 | 79,842 | |
Total comprehensive income attributable to | |||
Shareholders of CTS KGaA | 71,033 | 64,660 | |
Non-controlling interests | 9,543 | 15,182 | |
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
16 | Group Quarterly Statement | Consolidated Statement of Comprehensive Income |
CONSOLIDATED INCOME STATEMENT FOR THE PERIOD FROM 1 JULY TO 30 SEPTEMBER 2019
01.07.2019 | 01.07.2018 | ||
- 30.09.20191 | - 30.09.2018 | ||
[EUR'000] | [EUR'000] | ||
Revenue | 378,010 | 315,932 | |
Cost of sales | -284,102 | -242,996 | |
Gross profit | 93,908 | 72,936 | |
Selling expenses | -26,233 | -23,079 | |
General administrative expenses | -17,886 | -16,866 | |
Other operating income | 10,960 | 6,820 | |
Other operating expenses | -9,554 | -3,711 | |
Operating profit (EBIT) | 51,195 | 36,100 | |
Income / expenses from participations | 317 | 55 | |
Income / expenses from investments in associates accounted for at equity | -2,036 | 476 | |
Financial income | 184 | 175 | |
Financial expenses | -4,853 | -786 | |
Income before tax (EBT) | 44,807 | 36,020 | |
Taxes | -16,474 | -11,097 | |
Net income | 28,333 | 24,922 | |
Net income attributable to | |||
Shareholders of CTS KGaA | 24,041 | 19,535 | |
Non-controlling interests | 4,292 | 5,387 | |
Earnings per share (in EUR), undiluted (= diluted) | 0.25 | 0.20 | |
Average number of shares in circulation, undiluted (= diluted) | 96 million | 96 million | |
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
17 | Group Quarterly Statement | Consolidated Income Statement |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD FROM 1 JULY TO 30 SEPTEMBER 2019
01.07.2019 | 01.07.2018 | ||
- 30.09.20191 | - 30.09.2018 | ||
[EUR'000] | [EUR'000] | ||
Net income | 28,333 | 24,922 | |
Remeasurement of the net defined benefit obligation for pension plans | -1,269 | 84 | |
Items that will not be reclassified to profit or loss | -1,269 | 84 | |
Exchange differences on translating foreign subsidiaries | 1,341 | 1,054 | |
Change in the fair value of derivatives in cash flow hedges | -20 | -26 | |
Share of other comprehensive income (exchange differences) of investments accounted for | |||
using the equity method | 212 | -26 | |
Items that will be reclassified subsequently to profit or loss when specific conditions are met | 1,533 | 1,002 | |
Other results (net) | 264 | 1,086 | |
Total comprehensive income | 28,597 | 26,008 | |
Total comprehensive income attributable to | |||
Shareholders of CTS KGaA | 23,657 | 20,456 | |
Non-controlling interests | 4,940 | 5,553 | |
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
18 | Group Quarterly Statement | Consolidated Statement of Comprehensive Income |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to shareholders of CTS KGaA
Other reserves
Remeasure- | ||||||||||||||||||||||||
ment of the | ||||||||||||||||||||||||
net defined | Total equity | |||||||||||||||||||||||
Associated | benefit | attributable | ||||||||||||||||||||||
companies | obligation | to share- | Non-con- | |||||||||||||||||||||
Share | Capital | Statutory | Retained | Currency | Hedging | for at | for pension | Treasury | holders of | trolling | ||||||||||||||
capital | reserve | reserve | earnings | translation | instruments | equity | plans | stock | CTS KGaA | interests | Total equity | |||||||||||||
[EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | [EUR'000] | |||||||||||||
Status 01.01.2018 | 96,000 | 1,890 | 7,200 | 266,394 | 1,571 | -18 | -2,084 | -1,759 | -52 | 369,142 | 23,841 | 392,982 | ||||||||||||
Net income | 0 | 0 | 0 | 63,444 | 0 | 0 | 0 | 0 | 0 | 63,444 | 13,867 | 77,311 | ||||||||||||
Other income | 0 | 0 | 0 | 0 | 677 | -1 | 13 | 528 | 0 | 1,217 | 1,314 | 2,531 | ||||||||||||
Total income | 64,660 | 15,182 | 79,842 | |||||||||||||||||||||
Dividends | 0 | 0 | 0 | -56,635 | 0 | 0 | 0 | 0 | 0 | -56,635 | -4,402 | -61,037 | ||||||||||||
Changes in the scope | 6,866 | 4,604 | ||||||||||||||||||||||
of consolidation | 0 | 0 | 0 | 6,866 | 0 | 0 | 0 | 0 | 0 | -2,262 | ||||||||||||||
Other changes | 0 | 0 | 0 | 0 | -283 | 0 | 283 | 0 | 0 | 0 | 0 | 0 | ||||||||||||
Status 30.09.2018 | 96,000 | 1,890 | 7,200 | 280,069 | 1,964 | -19 | -1,788 | -1,231 | -52 | 384,034 | 32,358 | 416,391 | ||||||||||||
Status 01.01.2019 | 96,000 | 1,890 | 7,200 | 335,098 | 1,465 | -14 | -1,923 | -1,181 | -52 | 438,483 | 32,805 | 471,289 | ||||||||||||
Net income | 0 | 0 | 0 | 72,278 | 0 | 0 | 0 | 0 | 0 | 72,278 | 8,627 | 80,905 | ||||||||||||
Other income | 0 | 0 | 0 | 0 | 54 | -27 | 167 | -1,438 | 0 | -1,245 | 916 | -329 | ||||||||||||
Total income | 71,033 | 9,543 | 80,576 | |||||||||||||||||||||
Dividends | 0 | 0 | 0 | -59,515 | 0 | 0 | 0 | 0 | 0 | -59,515 | -4,788 | -64,302 | ||||||||||||
Changes in the scope | 0 | 1,075 | ||||||||||||||||||||||
of consolidation | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1,075 | ||||||||||||||
Other changes | 0 | 0 | 0 | -46 | 0 | 0 | 0 | 0 | 0 | -46 | 0 | -46 | ||||||||||||
Status 30.09.2019 | 96,000 | 1,890 | 7,200 | 347,814 | 1,519 | -41 | -1,756 | -2,619 | -52 | 449,955 | 38,636 | 488,591 |
19 | Group Quarterly Statement | Consolidated Statement of Changes in Equity |
CONSOLIDATED CASH FLOW STATEMENT FOR THE PERIOD FROM 1 JANUARY TO 30 SEPTEMBER 2019 (SHORT-FORM)
01.01.2019 | 01.01.2018 | |||
- 30.09.20191 | - 30.09.2018 | |||
[EUR'000] | [EUR'000] | |||
Net income | 80,905 | 77,311 | ||
Depreciation and amortisation on fixed assets | 40,189 | 26,524 | ||
Changes in pension provisions | 2,760 | -908 | ||
Deferred tax expenses / income | -1,950 | -5,137 | ||
Cash flow | 121,904 | 97,790 | ||
Other non-cash transactions | 4,717 | -3,419 | ||
Profit / loss from disposal of fixed assets | 125 | -3,540 | ||
Interest expenses / Interest income | 2,651 | 1,804 | ||
Income tax expenses | 48,369 | 41,419 | ||
Interest received | 581 | 368 | ||
Interest paid | -1,265 | -1,417 | ||
Income tax paid | -52,789 | -26,310 | ||
Increase (-) / decrease (+) in inventories | 647 | 512 | ||
Increase (-) / decrease (+) in payments on account | 21,666 | -1,125 | ||
Increase (-) / decrease (+) in marketable securities and other investments | -872 | -3,579 | ||
Increase (-) / decrease (+) in receivables and other assets | 11,153 | -2,981 | ||
Increase (+) / decrease (-) in provisions | -3,546 | -6,078 | ||
Increase (+) / decrease (-) in liabilities | -322,851 | -157,517 | ||
Cash flow from operating activities | -169,510 | -64,074 | ||
Cash flow from investing activities | -46,529 | -2,323 | ||
Cash flow from financing activities | -92,401 | -90,481 | ||
Net increase / decrease in cash and cash equivalents | -308,440 | -156,878 | ||
Net increase / decrease in cash and cash equivalents due to currency translation | 1,959 | 278 | ||
Cash and cash equivalents at beginning of period | 873,206 | 640,726 | ||
Cash and cash equivalents at end of period | 566,725 | 484,125 | ||
Composition of cash and cash equivalents | ||||
Cash and cash equivalents | 566,725 | 484,125 | ||
Cash and cash equivalents at end of period | 566,725 | 484,125 | ||
1 The Group applied IFRS 16 as of 1 January 2019 for the first time using the modified retrospective method. When applying this method, the comparative information for fiscal year 2018 will not be adjusted.
20 | Group Quarterly Statement | Consolidated Cash Flow Statement |
FORWARD-LOOKING STATEMENTS
This Group quarterly statement contains forecasts based on assumptions and estimates by the corporate management of CTS KGaA. These statements based on assumptions and estimates are in the form of forward-looking statements using terms such as 'believe', 'assume', 'expect' and the like. Even though corporate management believes that these assumptions and estimates are correct, it is possible that actual results in the future may deviate materially from such assumptions and estimates due to a variety of factors. The latter may include changes in the macroeconomic environ- ment, in the statutory and regulatory framework in Germany and the EU, and changes within the industry. CTS KGaA does not provide any guarantee or accept any liability or responsibility for any divergence between future developments and actual results, on the one hand, and the assumptions and estimates expressed in this Group quarterly statement. CTS KGaA has no intention and undertakes no obligation to update forward-looking statements in order to adjust them to actual events or developments occurring after the date of this report.
The consolidated financial statements are denominated in Euro. All amounts in the Group quarterly statement are rounded to thousand Euros. This may lead to minor deviations on addition.
The Group quarterly statement is also available in German. The German version of the Group quarterly statement takes priority over the English translation in the event of any discrepancies. Both language versions can be downloaded at www.eventim.de.
CONTACT: | EDITORIAL OFFICE: | ||||
CTS EVENTIM AG & Co. KGaA | CTS EVENTIM AG & Co. KGaA | ||||
Contrescarpe 75 A | |||||
28195 Bremen | ARTWORK: | ||||
Phone:+49 | (0) | 421 | / 36 66 - 0 | ||
Fax: | +49 | (0) | 421 | / 36 66 - 2 90 | |
SECHSBAELLE, Bremen | |||||
www.eventim.de | www.sechsbaelle.de | ||||
investor@eventim.de | |||||
PUBLISHERS' NOTES | COVER PICTURE: | ||||
PUBLISHED BY: | Sandra Ludewig | ||||
CTS EVENTIM AG & Co. KGaA | |||||
Contrescarpe 75 A | |||||
28195 Bremen | |||||
Phone:+49 | (0) | 421 | / 36 66 - 0 | ||
Fax: | +49 | (0) | 421 | / 36 66 - 2 90 |
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CTS Eventim AG & Co. KGaA published this content on 21 November 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 November 2019 09:20:07 UTC