ENIRO Q1 REPORT · Handelsbanken, Nordea, SEB and Swedbank) - long-term financing in place,...
Transcript of ENIRO Q1 REPORT · Handelsbanken, Nordea, SEB and Swedbank) - long-term financing in place,...
ENIRO Q1 REPORT
2013-04-25
Johan Lindgren, CEO
Mattias Lundqvist, CFO
Cecilia Lannebo, Head of IR
CEO INTRODUCTION & SUMMARY
2
Refinance done with all six banks in consortium - long-term financing in
place, positive for shareholders and Eniro
Increased operational flexibility
More flexible amortization plan
Deliver on EBITDA, cost savings, cash flow and net profit
Online/mobile is doubling pace of growth
A digital media company with 79 percent of ad revenues being digital
the transformation is done
long-tail Print and Voice
Focus 2013 on:
Further increase user attractiveness, traffic and online offering
EBITDA
De-leverage
A STRONG FIRST QUARTER; IMPROVEMENTS ON
MOST PARAMETERS
3
13
-39
156
8889
170
886
959
Revenues
+14
-73
Net Debt
2,539
3,515
Operating
Cash Flow
Net Profit
EBITDA
+75 +128
-976
Q1 2013
Q1 2012
• Currency SEK 14 M
• Divestures/moved publications SEK 8 M
• Gule Sider in Norway SEK 33 M
= total of SEK 55 M
PROS AND CONS IN THE Q1 REPORT
Pros Cons
Refinancing in place with all six banks Top-line development
EBITDA increasing
Online/mobile increasing
Continued cost saving
Net profit increased substantially
Cash flow improving
Net debt continued to be lowered
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DEVELOPMENT NET DEBT/EBITDA
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SEK M X
0
1
2
3
4
5
0
2 000
4 000
6 000
8 000
10 000
2006 2007 2008 2009 2010 2011 12 Q1 12 Q2 12 Q3 12 Q4 13 Q1
Net Debt EBITDA 12 months Net Debt/EBITDA
REFINANCING
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Refinance done with all six banks in consortium (Danske Bank, DNB,
Handelsbanken, Nordea, SEB and Swedbank) - long-term financing in
place, positive for shareholders and Eniro
SEK 3 billion in loan agreement is for three years with a extension to four
years, on the condition that Eniro replaces SEK 800 M of bank loan with a
corporate bond
Increased operational flexibility
More flexible amortization plan
Opportunity for future dividends
Interest rates in line with previous agreement
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FINANCIAL HIGHLIGHTS, Q1 2013
Revenues SEK 886 M (959), a decline of 8% (-1). Negative currency effects,
divestments and discontinued publication of printed products in Norway accounts
for 5 percent. Organically revenues declined by 7 percent (-8).
Online/mobile organic revenues increased 4% (2)
Cost reductions in Q1 SEK 86 M
EBITDA SEK 170 M (156), EBITDA margin of 19,2% (16,3)
Adjusted EBITDA SEK 183 M (160)
• Restructuring costs SEK 13 M from reorganization of support functions
Net profit increases to SEK 89 M (-39)
Operating cash flow SEK 88 M (13)
Interest bearing net debt SEK 2,539 M (3,515), (Q4 2,704)
Net debt/EBITDA 2.5 (3.2) (Q4 2.8)
Q1 DIVESTURES AND ACQUISITIONS
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Merger agreement with Norwegian low-price Voice competitor 1888.
60 percent owned by Eniro and 40 percent by Marell Invest AS and TV2
AS
est. to increase revenues by some SEK 50 M and EBITDA of
some SEK 20 M (full year effect) (SEK 10 M in revenues in Q1)
Divesture of Start.no, part of SOL which Eniro owns jointly 50% with DB
Medialab AS (Dagbladet)
no effect on cash flow or balance sheet, low impact on future
revenues and EBITDA
• Consolidating part of the Norwegian Voice market
• Leaner and more focused Eniro operation
• Expanding into social ad market
Acquiring Bloggerfy, one of the largest network for bloggers in the Nordics,
for SEK 0,5M and thereby gets a strong position within social ad market
RESTRUCTURING FOR FUTURE
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Restructuring costs of SEK 13 M in Q1
• Majority from reorganizations done within HR, Communication & Brand
and Finance support functions
• Recruitment function outsourced to Proffice
Reorganizations done to support a leaner and
more efficient organization 2013
Creates room for further cost savings already in 2013
PRODUCT DEVELOPMENT IN Q1
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January 2013 – Integration of Swedish Hemnet into Eniro’s iPad service
January 2013 – A new sales concept for print being launched
January 2013 – Use your local Eniro services in the other Nordic countries
March 2013 – Integration of public transportations in the Norwegian local search function
April 2013 – New product launch – Eniro is offering its customer Facebook homepage
2013 FOCUS ON STRENGTHENING ONLINE OFFERING
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Future product development done with the business model as
backbone and focus on:
User experience
Quality
Service offering
Harmonized and modern “same look and feel” on
all platforms
Product development to fit current search
behavior were searches are done with a
multi-channel approach
MOBILE – FASTEST GROWING SEARCH SEGMENT
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Eniro strong market position within mobile advertising
25 percent of searches via mobile devices – selling on par with traffic
Mobile revenues increasing by 96 percent in Q1
Mobile revenues to double 2013 to some SEK 300 M
POSITIONED TOWARDS GROWING
MEDIA SEGMENTS
13 Note: Estimated growth from IRM
579
347 Printed catalogue
Mobile
Online catalogue
2.291
Banners 2.275
Search words 3.482
Development, estimate 2013
(Percentage growth compared with 2012)
Swedish media market value, estimate 2013
(SEK M)
-30%
+52%
+2%
+2%
+20%
Total value: ~SEK 9Bn Total growth: 9%
Estimated growth for Eniro’s markets for equivalents media segments 6-10 percent 2013
TRAFFIC DEVELOPMENT
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Eniro.se
Panoramafirm.pl Krak.dk
Company searches, monthly average
Gulesider.no
2 000 000
6 000 000
10 000 000
14 000 000Jan
Feb
Ma
r
Ap
r
Ma
y
Ju
n
Ju
l
Au
g
Se
p
Oc
t
No
v
De
c
2013 2012 2011
4 000 000
6 000 000
8 000 000
10 000 000
12 000 000
14 000 000
Ja
n
Feb
Ma
r
Ap
r
Ma
y
Ju
n
Ju
l
Au
g
Sep
Oc
t
No
v
Dec
2013 2012 2011
2 000 000
4 000 000
6 000 000
8 000 000
10 000 000
Jan
Fe
b
Ma
r
Ap
r M…
Ju
n
Ju
l A…
Se
p
Oc
t N…
De
c
2013 2012 20112 000 000
4 000 000
6 000 000
8 000 000
10 000 000
Jan
Feb
Ma
r
Ap
r
Ma
y
Ju
n
Ju
l
Au
g
Se
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Oc
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No
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2013 2012 2011
REVENUE BRIDGE Q1 2013
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Currency
effects
Divested
business
Reported
revenues
2012
Reported Acq. Adj.
revenues Voice Other Media Print Online Organic
baseline
Moved
publications
-3 -6 4 -43 8
Revenue effect from divested operations, currency and moved publications, totaled SEK -22 M
Revenues decreased by 7% organically
Digital revenues 79% of total advertisement incomes
-8%
10
74
10 1
875
959
18 937
2 14
10
886 4
-7%
COST SAVINGS
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Reported
costs 2013
YTD
Acquired Adj
operating
costs
2013 YTD
Net Savings
Q1
Currency
effect
Divested
Including acquisitions
Note: vs FY 2011 restate
Operating
cost 2012
YTD
Organic
baseline
2012
Total savings in Q1 2013 SEK 85 M
Of which Staff SEK 37 M, Print and Paper SEK 7 M and Outsourced services SEK 8 M
23
9
86
8 9
771
16
718 708
94
786
13 4 803
23
684
-79
85
Cost ex 3rd party
3’rd party cost
REFINANCING, TERMS AND CONDITIONS
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Loan facility
SEK 3Bn, were of SEK 250 M in RCF. Three years with an extension to four
years, on the condition that Eniro replaces SEK 800 M of bank loan with a
corporate bond
Amortizations
Bank loan expected to decrease with some SEK 375 M during 2013.
Planned amortizations for 2014-2016 approx. SEK 375 M annually
Interest rates
Base rate Stibor plus 375bp (lowered to 300bp at net debt/EBITDA below
2x)
Timing
Loan facility comes into effect end of Q2 2013
CHANGE IN NET DEBT
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Operating cash flow in Q1 increased with SEK 75 M to SEK 88 M (13)
Adjusted net debt/EBITDA 2.5 (3.2) Q4 2.8
Analysis of interest bearing net debt
- 3 months - - 12 months-
2013 2012 * 2012/13 * 2012*
SEK M Jan-Mar Jan-Mar Apr-Mar Jan-Dec
Opening balance -2 704 -3 535 -3 515 -3 535
Operating cash flow 88 13 374 299
Acquisitions and divestments 41 26 85 70
Share issue - -1 377 376
Translation difference and other changes 36 -18 140 86
Closing balance -2 539 -3 515 -2 539 -2 704
Net debt /adjusted EBITDA, times 2,5 3,2 2,5 2,8
COMMENTS ON FINANCIALS
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Amortizations
Depreciable intangible assets that arose in connection with the
acquisition of Findexa 2005 was fully amortized by December 2012.
Lowering amortizations 2013 by SEK 283 M 2013 vs. 2012.
In the income statement, this is recognized in marketing cost
(impacting reported Q1 marketing cost with SEK 75 M)
Taxes
Eniro's tax payments are primarily in the first half. Paid tax will thus
be low in the second half of 2013
Working capital
The assessment is that working capital will continue to be slightly
negative for 2013
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OUTLOOK & FOCUS FOR 2013
BOTTOM-LINE PROFITABILITY AND EBITIDA
To report an EBITDA in line with outcome 2012
To drive net income
CASH-FLOW AND CONTINUED DELEVERAGE
Strong cash-flow generation
Lowered debts
REVENUES
Digital media, 2/3 of operations, to grow
Print and Voice, 1/3 of operations, to decline
ENIRO Q4 REPORT
Appendix
ONLINE/MOBILE
• Total revenues increases +2 percent
• Organic development +4 percent
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• Total and organic revenues decreased -43 percent
MEDIA PRODUCTS
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• Total revenues increased by 6 percent. Organic revenues increased by 8%
• A continued ramp up in growth is expected
VOICE
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• Total revenues decreased 1 percent. Organic revenues decreased 6 percent
• Q1 EBITDA SEK 57 M (57), an EBITDA margin of 31,5 percent (31,1)
• Merger agreement with 1888 in Norway
REVENUE OVERVIEW
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Revenues by category2013 2012 * 2012/13 * 2012*
SEK M Jan-Mar Jan-Mar % Apr-Mar Jan-Dec
Total revenues 886 959 -8 3 926 3 999
Directories 705 776 -9 3 159 3 230
Online/mobile 524 513 2 2 135 2 124
Print 98 172 -43 666 740
Media products 57 54 6 237 234
Other products 26 37 -30 121 132
Voice 181 183 -1 767 769
Revenues by country2013 2012 * 2012/13 * 2012
SEK M Jan-Mar Jan-Mar % Apr-Mar Jan-Dec
Total revenues 886 959 -8 3 926 3 999
Sw eden 410 450 -9 1 839 1 879
Norw ay 265 310 -15 1 101 1 146
Denmark 109 104 5 530 525
Finland 53 58 -9 244 249
Poland 49 37 32 212 200
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EBITDA OVERVIEW
EBITDA by revenue area2013 2012 * 2012/13 * 2012
SEK M Jan-Mar Jan-Mar % Apr-Mar Jan-Dec
Total EBITDA 170 156 9 990 976
Directories 126 126 0 777 777
Voice 57 57 0 279 279
Other -13 -27 -66 -80
Items affecting comparability
Restructuring costs 13 4 57 48
Other items affecting comparability - - -48 -48
Total adjusted EBITDA 183 160 14 999 976
* Restated comparison year in accordance w ith new accounting principle regarding pensions