H1 2020 RESULTS
29 JULY 2020
H1 2020 HIGHLIGHTS
DURING THE COVID-19 CRISIS, THE TF1 GROUP HAS DEMONSTRATED ITS ADAPTABILITY AND STRONG REACTIVITY
- Strong ratings thanks to editorial choices meeting the public's expectations
- Significant downsizing of the programming costs offsetting over 50% of the decrease in advertising revenues
- Efficient management of the health crisis by protecting employees health, adapting working methods (work from home and part-timework) and enabling the news activity to proceed
THE TF1 GROUP IS FULLY OPERATIONAL AND READY TO BENEFIT FROM RECOVERY
- Gradual slowdown in the decline of the advertising market since the beginning of June
- Strategic decision to keep fresh and premium programming for the last four months of 2020
- Strong reactivity from Newen in resuming all shooting as early as possible
- Sound financial position with low debt and access to available bilateral credit facilities
2
H1 2020 Activity Review
THE GROUP CREATES A UNIQUE BOND THROUGH ITS BROAD CONTENT OFFER
- High level of TV viewing time since March (3 hrs 56 mins in H1 2020 ; +26min yoy)
- Audience share of Ind. 25-49 y/o remained at a high level in H1 2020 at 29.6 % (stable yoy)
- High and quick reactivity on the grid management with more family-oriented programmes
POPULAR CULT COMEDIES | FLAGSHIP ENTERTAINMENT BRANDS | INTERNATIONAL FAMILY FRANCHISES | ORIGINAL US SERIES |
Harry Potter
@Warner Bros Ent. Harry Potter Publishing Rights JK Rowling
8.0 million TV viewers | Record season with | 7.2 million TV viewers on | 5.2 million TV viewers on |
(Ranked no.1 during lockdown | 6.8 million TV viewers on | average for the 8 movies | average for the 1st season |
excl. news) | average | 47% of W<50PDM | 35% of W<50PDM |
42% of W<50PDM |
Source: Médiamétrie - Médiamat | 4 |
LEADERSHIP IN NEWS CONSOLIDATED
- Daily news shows extended in order to provide comprehensive and rigorous coverage of the health crisis
- Enhanced leader status thanks to TF1's ability to attract top politicians and health experts
6.3m TV viewers on average | 6.7m TV viewers on average | 6.8m TV viewers on average | 1.3% audience share for Ind. aged 4+ (+0.3 pts yoy) |
+1.3m TV viewers vs H1 2019 | + 1.3m TV viewers vs H1 2019 | + 1.4m TV viewers vs H1 2019 | No. 2 news channel for Ind. aged 4+ |
Source: Médiamétrie - Médiamat - H1 2020 | 5 | ||
MYTF1 LEADERSHIP CONFIRMED, ONE YEAR AFTER RELAUNCH
- Around 21 million active user accounts
- + 47% video views* on OTT
- Catch-upTV enhanced by AVOD offer attracting young people through successful content like manga Naruto, US series 90210 or French soap Sous le Soleil
*Sept 2019 to June 2020 vs Sept 2018 to June 2019 - excluding app FAI and news | 6 |
SIGNIFICANT REDUCTION OF THE PROGRAMMING COSTS
- Revisited formats for key franchises with stretched episodes and no-public attendance
- High number of reruns both on TF1 and DTT channels
- Extended daily news shows at no additional cost
- Extra supply of movies at an optimized price
- Savings of €107m for the first 6 months of 2020…
- … offsetting 52% of the drop in broadcasting advertising revenues
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STRONG REACTIVITY FROM
- Understanding the impacts of the crisis in the different sectors
- Accompanying our historical clients during the crisis
- Attracting new advertisers (+106 in H1 2020 yoy)
- Motivating advertisers to return to TV in the last 4 months of 2020
TF1 Pub organized webinars with | New advertisers in H1 2020 |
advertisers to help them during the crisis |
8
AFTER LOCKDOWN, A GRADUAL RETURN TO TV ADVERTISING BY SECTOR
Based on TV ad revenue trends through H1 2020 | 9 |
EARLY REBOUND OF NEWEN ACTIVITY AFTER LOCKDOWN
- Some shooting continued with social distancing rules observed (the daily programme Le Magazine de la santé and the famous Belgian TV quiz show Blokken)
- Shooting restarted as early as possible (since mid-May for the 2 French daily soaps Demain Nous Appartient and Plus Belle La Vie)
- Book of orders remaining at a high level at more than 1,500 hours
- Additional sales from the TF1 Studio and Reel One catalogues
© Fabien Malot
Le Magazine de la santé | Shooting restart of | 10 |
Demain Nous Appartient |
STRONG ATTRACTIVENESS OF UNIFY BRANDS
- Highly relevant content on the web with Doctissimo on health and Marmiton on cooking
- 437m visits to Marmiton website in H1 2020; +56% yoy
- Significant reduction of advertising spend in digital and programmatic due to the crisis…
- … but resilience of the social e-commerce business
- Development of synergies with TF1 channel
- Opportunistic TV advertising campaigns for My Little Box, Gambettes Box and Beautiful Box on TF1
- Editorial partnership between News and Doctissimo
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THE TF1 GROUP HAS SUPPORTED A VARIETY OF GOOD CAUSES DURING THE HEALTH CRISIS
SOLIDARITY
- Identifying hospital's urgent needs and putting together product and service offers from companies
- Raising funds to support health workers, patients, vulnerable people and medical research
- Donating game show gains to charities involved in health care, fighting violence against women and food distribution
NEWS | FREE TV CAMPAIGNS | DEDICATED TV PROGRAMMES |
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H1 2020 Financial Results
CONSOLIDATED REVENUE
(€M) | H1 2020 | H1 2019 | CHG.€M | CHG.% |
BROADCASTING | 683.3 | 890.8 | (207.5) | -23.3% |
ADVERTISING REVENUE | 586.1 | 791.4 | (205.3) | -25.9% |
OTHER REVENUE | 97.2 | 99.4 | (2.2) | -2.2% |
STUDIOS & ENTERTAINMENT | 131.8 | 168.8 | (37.0) | -21.9% |
PRODUCTION / SALE OF AUDIOVISUAL RIGHTS | 107.8 | 110.5 | (2.7) | -2.4% |
REVENUE FROM GAMES, MUSIC, LIVE SHOWS & HOME SHOPPING | 24.0 | 58.3 | (34.3) | -58.8% |
UNIFY | 68.4 | 85.6 | (17.2) | -20.1% |
WEB PUBLISHING (DIGITAL CONTENT, SOCIAL E -COMMERCE) | 53.5 | 67.7 | (14.2) | -21.0% |
OTHER REVENUE (DIGITAL MARKETING) | 14.9 | 17.9 | (3.0) | -16.8% |
TOTAL REVENUE | 883.5 | 1,145.2 | (261.7) | -22.9% |
Excluding the effect of changes in structure, H1 2020 revenues dropped by -22.6%
Under IFRS 16 norm | 14 |
COST OF PROGRAMMES
(€M) | H1 2020 | H1 2019 | CHG.€M | CHG.% |
DRAMA / TV MOVIES / SERIES / PLAYS | -109.0 | -150.2 | 41.2 | -27.4% |
VARIETY / GAMESHOWS / MAGAZINES | -107.1 | -138.2 | 31.0 | -22.5% |
NEWS (INCLUDING LCI) | -65.7 | -70.2 | 4.5 | -6.4% |
MOVIES | -52.3 | -55.5 | 3.2 | -5.8% |
CHILDREN'S PROGRAMMES | -4.2 | -5.3 | 1.1 | -20.8% |
SPORTS | -0.5 | -26.9 | 26.3 | -98.0% |
TOTAL | -338.8 | -446.2 | 107.4 | -24.1% |
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CURRENT OPERATING PROFIT PER SEGMENT
(€M) | H1 2020 | H1 2019 | CHG.€M | CHG.% |
BROADCASTING | 75.9 | 142.5 | (66.6) | -46.7% |
MARGIN | 11.1% | 16.0% | - | -4.9PTS |
STUDIOS & ENTERTAINMENT | 0.0 | 17.3 | (17.3) | -100.0% |
MARGIN | 0.0% | 10.2% | - | -10.2PTS |
UNIFY | (8.1) | 3.2 | (11.3) | N/A |
MARGIN | - | 3.7% | - | - |
CURRENT OPERATING PROFIT | 67.8 | 163.0 | (95.2) | -58.4% |
MARGIN | 7.7% | 14.2% | - | -6.6PTS |
Under IFRS 16 norm | 16 |
CONSOLIDATED INCOME STATEMENT
(€M) | H1 2020 | H1 2019 | CHG.€M | CHG.% |
CONSOLIDATED REVENUE | 883.5 | 1,145.2 | (261.7) | -22.9% |
TOTAL COST OF PROGRAMMES | (338.8) | (446.2) | 107.4 | -24.1% |
OTHER CHARGES, DEPRECIATION, AMORTIZATION, PROVISIONS | (476.9) | (536.0) | 59.1 | -11.0% |
CURRENT OPERATING PROFIT | 67.8 | 163.0 | (95.2) | -58.4% |
CURRENT OPERATING MARGIN | 7.7% | 14.2% | - | -6.6PTS |
OTHER OPERATING INCOME AND EXPENSES | 0.0 | 0.0 | 0.0 | N/A |
OPERATING PROFIT | 67.8 | 163.0 | (95.2) | -58.4% |
COST OF NET DEBT | (1.4) | (1.0) | (0.4) | 40.0% |
OTHER FINANCIAL INCOME AND EXPENSES | (5.5) | (3.3) | (2.2) | 66.7% |
INCOME TAX EXPENSE | (21.8) | (51.2) | 29.4 | -57.4% |
SHARE OF PROFITS / (LOSSES) OF ASSOCIATES | (1.4) | (0.6) | (0.8) | 133.3% |
NET PROFIT | 37.7 | 106.9 | (69.2) | -64.7% |
NET PROFIT ATTRIBUTABLE TO THE GROUP | 38.4 | 107.3 | (68.9) | -64.2% |
Under IFRS 16 norm | 17 |
BALANCE SHEET
CONSOLIDATED ASSETS (€M) | JUN.30TH 2020 | DEC. 31ST 2019 | CHG.€M |
TOTAL NON-CURRENT ASSETS | 1,507.5 | 1,507.3 | 0.2 |
TOTAL CURRENT ASSETS | 1,938.7 | 1,836.8 | 101.9 |
TOTAL ASSETS | 3,446.2 | 3,344.1 | 102.1 |
CONSOLIDATED LIABILITIES (€M) | JUN.30TH 2020 | DEC. 31ST 2019 | CHG.€M |
TOTAL SHAREHOLDERS' EQUITY | 1,591.1 | 1,564.1 | 27.0 |
SHAREHOLDERS' EQUITY ATTRIBUABLE TO THE GROUP | 1,589.5 | 1,562.4 | 27.1 |
TOTAL NON-CURRENT LIABILITIES | 402.5 | 377.5 | 25.0 |
TOTAL CURRENT LIABILITIES | 1,452.6 | 1,402.5 | 50.1 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | 3,446.2 | 3,344.1 | 102.1 |
NET DEBT (-) EXCLUDING LEASE OBLIGATIONS | (22.1) | (126.3) | 104.2 |
NET DEBT (-) INCLUDING LEASE OBLIGATIONS | (114.3) | (225.8) | 111.5 |
Under IFRS 16 norm | 18 |
TRENDS IN NET CASH POSITION H1 2020 (excluding the impact of IFRS 16*)
2020 €M
104.8
138.7 | ||||||||||||
-22.1 | ||||||||||||
-9.6 | ||||||||||||
-115.3 | ||||||||||||
-5.7 | ||||||||||||
-8.7 | ||||||||||||
-126.3
Cash position | Operating | Decrease | Change in | Net capital | Acquisitions/ | Dividends, shares | Cash position | ||||||||||||
1st January | cashflow** | in lease | operating | expenditure | disposals | buyback and stock- | 30th June | ||||||||||||
obligations | working | options and | |||||||||||||||||
capital needs | others*** | ||||||||||||||||||
2019 | -27.5 | 235.7 | -9.1 | 10.2 | -119.9 | -32.3 | -85.8 | -28.7 | |||||||||||
(*) Excluding lease obligations | |||||||||||||||||||
(**) Cash flow after income from net surplus cash/cost of net debt, interest expense on lease obligations and income taxes paid | 19 | ||||||||||||||||||
(***) Including acquisition of financial assets, net change in borrowings and cost of net debt |
COVID-19 IMPACTS
- Negative impact on H1 2020 results
- Total revenue drop of around €250m
- EBIT drop of around €100m
- Low visibility for the coming months
- Withdrawal of our objectives for 2021:
- Unify: revenue of at least €250m and EBITDA margin of at least 15%
- TF1 group: improvement in return on capital employed relative to the 2018 level (8.8%)
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Outlook
STRONG LINE-UP TO SEIZE OPPORTUNITIES IN BACK-TO-SCHOOL PERIOD
- New seasons of key franchises: Mask Singer, Koh Lanta, etc.
- TV premieres for French hit movies and international blockbusters: Le Sens de la Fête, A star is born, etc.
- Brand new mini series: Grand Hotel, HPI, Pourquoi je vis, etc.
- New hosts on LCI
KEY FRANCHISES | FRENCH DRAMA | CINEMA |
@Christophe Chevalin - TF1 | ©Thibault Grabherr /Itinéraire Productions/TF1 |
2nd season on TF1 | HPI, new series on TF1 | More than 3 million box | Darius Rochebin and |
office entries | Eric Brunet |
22
MANY NEW PRODUCTIONS IN THE PIPELINE FOR NEWEN
- Strong line-up of shooting for H2 2020 with originals like Grand Hotel (TF1) and Opera (OCS)
- 2 new daily soaps Ici tout commence (TF1) and Lisa (VTM) confirming Newen know-how in such format
- More than 10 production projects for platforms like the movie Ferry and the series Undercover (season 2) for Netflix both produced by De Mensen
Lisa
© VTM
Undercover (season 2)
© Nyk Dekeyser
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MORE OPPORTUNITIES TO COME
SALTO, A PLATFORM WITH LOCAL CONTENT ON AN UNPRECEDENTED SCALE
- Platform beta test in July 2020
- Launch in fall 2020
FRENCH REGULATION COULD OPEN UP NEW OPPORTUNITIES FOR THE TF1 GROUP
- Support for private audiovisual group through the settlement of a tax credit based on 15% of the programming costs related to French and European drama and movies incurred between March and December 2020
- Decrees to be signed this summer on TV advertising for movies and addressable TV
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CONCLUSION
- The TF1 group has demonstrated its high reactivity to face the crisis...
- … and is confident in the long-term sustainability of its activities
- High TV consumption level renews the relevance of TV as a media
- Production and digital markets offer strong growth potential
MOVING TO TOTAL VIDEO
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TF1 - Television Francaise 1 SA published this content on 29 July 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 July 2020 06:05:11 UTC