Transcript Document

Independent News & Media PLC
Full Year Results 2001
17th April 2002
GLOBALISATION DELIVERING GROWTH
• Global Portfolio of Leading Brands
• Market Leaders
• Strong Cost Management
• Highly CASH generative business
GLOBAL VISION
LOCAL CONTENT
2001 HIGHLIGHTS
• Circulation Revenue UP + 7.2%
• Newspaper Advertising Revenue only down (1.6%)
But UP in constant currency by + 4.5%
• Operating Costs down despite Newsprint Price
increase
• Operating Margins maintained at 2000 levels
• Successful €105m share placement
• Successful restructuring of Australasian assets
RESTRUCTURING OF AUSTRALASIAN ASSETS
• Sale of Wilson & Horton to APN News & Media
• Total cash gain on sale of €53.7m, with €32.5m
recognised in P&L (39.5% deferred as inter-group)
• Cash received by Group of €455m less re-investment
in APN of €241m; net inflow €214m
• Increased shareholding in APN to 44.55%
• EPS enhancing for both Independent & APN
• Opens new opportunities in Australasia
PEER GROUP COMPARISON – 2001
Newspaper
Newspaper
Total Advertising
Circulation
Operating
Revenue
Revenue
Revenue
Profit
Independent News & Media *
-0.1%
-1.6%
+7.2%
+0.0%
Trinity Mirror - Nationals
-2.4%
-4.2%
-0.1%
-0.19%
Hollinger - UK Newspapers
-9.0%
-10.6%
-1.2%
-49.9%**
Pearson - Financial Times
-5.1%
-20.0%
n/a
-27.0%
John Fairfax Holdings ***
-10.7%
-10.8%
n/a
-47.2%
West Australia Newspapers ***
-15.4%
-12.0%
-3.1%
-30.6%
New York Times Company
-10.6%
-15.7%
+3.1%
-39.3%
-9.7%
-10.1%
-2.2%
-30.9%
Knight-Ridder Inc
*
Excluding exceptionals and share of results of JV's & associates
** 12 months EBITDA
*** 6 months ended 31 December 2001
PEER GROUP EXCEPTIONAL CHARGES – 2001
Exceptional Charge
€ millions
Independent News & Media
(90.1)
Trinity Mirror
(268.3)
Hollinger
(348.3)
Pearson
(360.3)
News Corporation *
(903.6)
Telewest
(1,817.6)
AOL Time Warner
(2,833.7)
Vivendi
* 6 months
(12,640.0)
2001 HEADLINE NUMBERS
2001
2000
€ millions
€ millions
Change
%
(as restated)
Group Turnover
1,341.4
1,342.5
-0.1%
Operating Profit *
218.4
218.4
0.0%
Net Exceptional Items
(57.6)
3.0
61.8
155.3
-60.2%
3.1
80.8
-96.2%
12.50
15.92
-21.5%
7.75
7.50
3.3%
532.7
514.4
3.6%
16.28%
16.27%
0.08%
Profit Before Tax
Net Profit
Earnings per Share (EPS) **
Dividend per Share (DPS)
Weighted Shares Outstanding (m)
Operating Margins *
* Excluding exceptionals and share of results of JV's & associates
** Before exceptional items and amortisation
2001 SUMMARY BALANCE SHEET
31 De c. 2001
31 Dec. 2000
Change
€ millions
€ millions
€ millions
(as restated)
Fixed Assets *
2,925
2,584
341
(2)
53
(55)
(1,056)
(1,493)
437
Capital Lease Liabilities
(249)
(7)
(242)
Total Shareholders' Funds
1,618
1,137
481
Interest Cover (EBITDA/Interest)
2.7x
3.7x
Total Net Debt ** to EBITDA
4.8x
5.7x
Other Net Assets/ (Liabilities)
Net Bank Debt
* Including the revalued elements of mastheads
2001 SUMMARY CASH FLOWS
2001
2000
Change
€ millions
€ millions
€ millions
227.3
246.5
(19.2)
(138.3)
(111.8)
(26.5)
(20.5)
(37.7)
17.2
(120.1)
(220.1)
100.0
Acquisition of Subsidiaries
(32.7)
(504.3)
471.6
Equity Dividends
(38.1)
(33.1)
(5.0)
Share & Note Issues
325.4
7.2
318.2
(7.6)
22.7
(30.3)
195.4
(630.6)
826.0
Operating Cash Flow
Interest & Minority Dividends
Taxation
Capex & Financial Investment
FX Movement & Other
Reduction/(Increase) in Net Debt
GROUP TURNOVER BY MARKET:
€1,341.4m
South
Africa
12%
United
Kingdom
18%
Ireland
28%
Australia
21%
New
Zealand
21%
GROUP PROFIT BY MARKET:
United
Kingdom
7%
€229.6m *
South
Africa
10%
Australia
25%
Ireland
32%
New
Zealand
26%
* Excluding exceptional items
EARNINGS PER SHARE: 10 YEAR PERFORMANCE
10 Year C.A.G.R.
Earnings per Share (€)
(Fully diluted before exceptionals & goodwill amortisation)
17.00
15.92
15.50
14.49
14.00
12.69
12.50
12.50
12.35
11.00
+ 21%
• Operating Profit *
+ 27%
• Pre-Tax Profit
+ 21%
• Earnings Per Share * + 12%
• Dividends Per Share + 14%
9.57
9.50
• Turnover
8.14
8.00
7.02
7.58
6.50 5.36
5.00
'92
'93
'94
'95
'96
'97
'98
'99
'00
'01
* Excluding exceptional items
NEW ZEALAND DIVISION
COMPANY PROFILE
€'m (constant FX)
No. 1 NEWSPAPER publisher
Turnover
No. 1 REGIONAL publisher
No. 1 RADIO operator
No. 1 COMMERCIAL PRINTER
3.6%
EBITDA
79.0
72.0
9.7%
Operating Profit
61.6
55.4
11.2%
21.0%
19.6%
• Revenue up, driven by cover price and
advertising rate increases
Turnover by Activity
1%
282.4
2001 PERFORMANCE & OUTLOOK
No. 1 News Website
17%
2000 Change
292.7
Operating Margin
No. 1 SECURITY PRINTER
2001
61%
21%
• Continuing strong cost management
• Strong performance from Radio
• Expansion of security printing to Australia
Publishing
Radio
Print
New Media
• Acquired by APN in Dec. 2001 & achieved
targets in APN Explanatory Memorandum
• Revenues strengthening into 2002
AUSTRALIAN DIVISION
COMPANY PROFILE
€'m (constant FX)
No. 1 REGIONAL publisher
Turnover
No. 1 OUTDOOR operator
No. 1 Australasian RADIO operator
JV in Pan TV’s World Movies
Growing Asian OUTDOOR business
2001
306.9
2000 Change
325.1
-5.6%
EBITDA
78.1
87.0 -10.2%
Operating Profit
63.2
71.9 -12.1%
Operating Margin
20.6%
22.1%
2001 PERFORMANCE & OUTLOOK
Turnover by Activity
20%
1%
• Tough advertising market in 2001
40%
• Continuing tight cost control
• Achieved 2001 targets set out in APN
Explanatory Memorandum
39%
Publishing
Radio
Outdoor
New Media
• Key tender & license wins for Outdoor &
Radio
• Expansion into fast-growing Asian market
on-track
SOUTH AFRICAN DIVISION
COMPANY PROFILE
€'m (constant FX)
No. 1 METROPOLITAN/ NATIONAL
publisher (14 out of 25 titles)
No. 1 OUTDOOR operator (55%
share) through acquisition of JV
with Clear Channel
No. 1 News Current Affairs Website
1%
2000 Change
194.9
189.0
3.1%
EBITDA
31.1
28.7
8.4%
Operating Profit
27.1
24.3
11.5%
13.9%
12.9%
Operating Margin
2001 PERFORMANCE & OUTLOOK
• Revenue growth from both circulation &
advertising
Turnover by Activity
10%
Turnover
2001
89%
• Circulations: 10 out of 14 titles UP – all
competitors significantly down
• Strong cost management
• Outdoor Acquisition - EPS enhancing
Publishing
Print
New Media
• Realisation of Pension Fund surplus
UNITED KINGDOM DIVISION
COMPANY PROFILE
Leading NATIONAL titles in G.B.
No. 1 PUBLISHER in Northern Ireland
No. 2 London REGIONAL publisher
No. 1 RECRUITMENT mag. Publisher
No. 1 EDUCATIONAL mag. Publisher
Turnover by Activity
11%
7%
5% 1%
2001
€'m (constant FX)
76%
Turnover
2000 Change
253.8
210.0
20.9%
EBITDA
25.4
16.1
57.8%
Operating Profit
17.6
12.4
41.9%
Operating Margin
6.9%
5.9%
2001 PERFORMANCE & OUTLOOK
• Core circulations UP
• Aggressive cover pricing
• Attractive advertising readership profiles
• Strong cost control – headcount down
8.5%
Nationals
Magazines
New Media
London Regionals
Print
• Newsprint price reductions achieved for
2002
IRISH DIVISION
COMPANY PROFILE
No. 1 NATIONAL publisher
2001
€'m
Turnover
2000 Change
370.9
335.9
10.4%
No. 1 REGIONAL publisher
EBITDA
83.9
74.1
13.2%
No. 1 COMMERCIAL PRINTER
Operating Profit
73.2
66.3
10.4%
No. 1 WHOLESALER/ DISTRIBUTOR
Operating Margin
19.7%
19.7%
Turnover by Activity
22%
2%
76%
2001 PERFORMANCE & OUTLOOK
• Successful commissioning of CITYWEST
• Strong ADVERTISING growth & significant
gains in MARKET SHARE
• Strong CIRCULATION growth
- Irish Independent achieves 19 year high
- The Star achieves all-time high
Publishing
New Media
Wholesaling
• Strong cost management & Newsprint
price reduction
NEW MEDIA
• PRUDENT New Media strategy and execution
• Extension of CORE brands
• Pro-active cost
management –
Headcount
down 43% from high point
during 2001
• Significant REDUCTION
in losses, as forecasted
NEW MEDIA STATS
€'m
2001
Turnover
7.4
Operating Losses
(6.8)
2000
7.7
(10.0)
Group Web Stats:
No. of Web Sites
Page Impressions / month
51
95m
48
100m
Headcount
158
203
• Minimal investment exposure - €11.5m, excl. iTouch & Chorus
iTOUCH PLC
• Excellent 2001 – 260% revenue growth on 2000
• Six consecutive quarters of good growth
• Controlling costs
Cash outflow, excluding acquisitions, only Stg£7.7m
• Key acquisitions during 2001
• Growth continuing into 2002
• Well positioned for mobile future with:Fully funded business model – Stg£36.1m in hand
Powerful international relationships
• Carrying value supported by current market value
SUMMARY
• GEOGRAPHICALLY diversified - with tight focus on
core competencies
• Unique BRAND leadership positions - dominant in 4
out of 5 markets
• Major capital expenditure programme now
COMPLETED
• HIGHLY cash generative business
• Significantly REDUCED exposure to New Media
• Clear strategy for operating margin ENHANCEMENTS
OUTLOOK
• CORE businesses performing well
• CIRCULATION revenues trending UP
• ADVERTISING showing signs of vitality
• Continued focus on COSTS – ‘run rate’ down
• Interest costs DOWN
• GLOBAL diversity underpinning growth
• Cautiously optimistic for IMPROVEMENT on 2001
Independent News & Media PLC
Full Year Results 2001
17th April 2002
GLOBAL VISION
LOCAL CONTENT