GfK Q1 20160513 · 5/13/2016 · © GfK 2016 | Q1 2016 Results Presentation | May 13, 2016 1 FIRST...

1© GfK 2016 | Q1 2016 Results Presentation | May 13, 2016

FIRST QUARTER 2016 RESULTS

ANALYST CALL

Matthias Hartmann, CEO

Christian Diedrich, CFO

GfK SE, May 13, 2016


This presentation constitutes neither an offer nor recommendation to subscribe or buy in any other way securities of GfK SE or any of the companies that are members of the Group at present or in the future, nor does it form part of such an offer and it should not be understood as such. The presentation or any part thereof should not form the basis for a contract for the purchase or subscription of securities of GfK SE or any of the companies that are members of the Group or represent a guarantee in connection with such contract. All the information contained in this presentation has been established with care. Nevertheless, we cannot guarantee its reliability or completeness and the information contained herein should not be deemed as a guarantee in this respect. The information contained in this presentation may be supplemented, amended and updated. Certain statements made herein may express future expectations, which are based on current opinions and assumptions of the management and are subject to foreseeable and unforeseeable risks and uncertainties. Actual results, performance and events may differ considerably from the statementsexpressed in the present information, partly due to changing business or market conditions and to the growth prospects forecast by the management of GfK SE. These and other factors may have an unfavorable impact on the results and financial consequences describedin this presentation. GfK SE does not undertake to update or revise statements on future developments, on the basis of new information, future events or for other reasons. You should not rely on statements made about future developments, which simply express expectations as of the date of this presentation. This document does not constitute an offer of sale of securities in the United States of America. Securities may not be offered or sold in the United States of America without registration or exemption from registration in accordance with the U.S. Securities‘ Act of 1933 in its currently valid form.

Disclaimer


Agenda

Business Highlights


Business Highlights


Financial Results


Financial Results


1

2

Guidance


Guidance

Matthias Hartmann, CEO3

Q&A



Q&A



4


Business Highlights Matthias Hartmann, CEO


Sales growth in % for Q1 2016

1 Data Investment Management segment isolated. Comprises Kantar, TNS, Millward Brown and The Futures Company, among others. Comparison analysis on revenue basis

GfK and Peers

0.9

-0.6

1.8

5.2

2.0

n/a

1.9

3.7

n/a

6.1

0.5

5.0

Data Investment Management1

Ipsos does not report growth at constant FX rates

Nielsen does not report organic growth

Total Organic At constant currency


Consumer Choices Highlights in Q1 2016

ConsumerChoices(CC)

Growth• Strong organic growth of 9.8%. FX effect -1.7%

• Margin down -1.1 pts

Point of Sales Measurement• Solid growth in core product categories (MDA/SDA, Telecom), established clients, all

regions except CEE/META

• Strong development in China mainly based on IT and Domestic Appliances despite weaknesses in underlying PC and MDA markets

• Ongoing expansion of the Trends and Forecasting business

Media MeasurementTAM Brazil:

• GfK accomplished the setup of its TAM services with minimum 6000 households in 15 main cities, reporting overnight and in real time

• Data delivery to the broadcasters and revenue recognition since October 2015

• Certain contractually required milestones (e.g. in-tab sample size) to be improved before Go-Live

Kingdom of Saudi-Arabia: Data delivery to customer and revenue recognition since January 2016

Singapore: Panel build-up on track, TV-Panel delivered on time; mobile/online build-up ongoing; first revenue recognition expected for Q2 2016


Consumer Experiences Highlights in Q1 2016

ConsumerExperiences(CE)

Margin improvement• Organic growth of -6.0% (Total growth: -6.9%; FX effect -2.9%)

• Margin up by 1.1 pts

• Efficiency and portfolio realignment efforts yielding AOI and margin improvement despite smaller revenue base

Business Performance• Weak order book and pipeline coming into the year

• Reductions and consolidations of spend in a few key clients; overall positive developments in Consumer Goods and Finance Industries but offset by declines in Technology

• Pick-up seen in Latin America and CEE/META but challenges in China and the mature markets

• New branded product wins occurring but not nearly as quick as planned reductions in lower margin work

Global branded products contributing 46% of sector sales


Financial Results Q1 2016Christian Diedrich, CFO


GfK Group with ongoing organic growth

Rounding differences possible

• Organic growth of 0.9% – driven by sector Consumer Choices

• Recently acquired NORM and Netquest are main drivers of inorganic growth

• Headwind from foreign exchange rate of -2.4%

• Adjusted operating income grew by 5 m€ with margin improvement of 1.4pts

• Consumer Choices margin down -1.1pts driven by TAM Brazil

• Consumer Experiences ongoing margin improvement of +1.1pts

In m€ Sales Growth rate in % AOI Margin in %

Q1Actual2016

Total OrganicAcqui-sitions

FX effectActual2016

∆

2016/2015Actual2016

∆

2016/2015

Consumer Choices

169.9 8.1% 9.8% 0.0% -1.7% 27.5 0.3 16.2% -1.1pts

Consumer Experiences

190.5 -6.9% -6.0% 2.0% -2.9% 7.7 1.6 4.0% 1.1pts

Other 0.1 - - - - -3.0 2.9 - -

Group 360.5 -0.6% 0.9% 0.9% -2.4% 32.1 4.8 8.9% 1.4pts


622

Strong organic growth in Latin America and CEE/META

Sales in m€

North America Northern Europe

In % Q1

Total -2.6

Organic -3.2

FX +0.2

74 72

2015 2016

In % Q1

Total -1.9

Organic -0.7

FX -1.6

136 133

2015 2016

CEE/META

In % Q1

Total 0.0

Organic +7.1

FX -7.1

29 29

2015 2016

Latin America

In % Q1

Total +19.5

Organic +44.9

FX -29.5

14 17

2015 2016

Southern & Western Europe

In % Q1

Total +0.4

Organic -2.9

FX -

63 63

2015 2016

Asia and the Pacific

In % Q1

Total -1.2

Organic +1.4

FX -2.6

46 45

2015 2016


AOI bridge GfK Group

8.9

Q1 2016Sales mix/

phasing/other

1.6

Restructuring/

Utilization

0.6

Depreciation

(TAM)

-0.8

Q1 2015

7.5

Q1 2015 AOI margin compared to Q1 2016 (in pts)


Group – Staff Development

169

204

Q1 2016

+1%

13.639

Netquest

acquisition

GSC ramp-up

and Other

-139

Sector

CE

Sector

CC

-80

YE 2015

13.485

Productivity and Capacity management

Scope of consolidationand GSC

+154


Strong EBIT and total income improvement

In m€2015

Q12016

Q12016 vs. 2015Changes in %

Sales 362.5 360.5 -0.6

Gross income from sales 107.3 102.7 -4.3

SGA expenses -83.1 -73.3 11.7

Other operating expenses (net) -4.7 -1.9 60.1

Highlighted items 7.7 4.5 -40.9

Adjusted operating income 27.3 32.1 17.6

AOI Margin 7.5% 8.9% 1.4pts

Highlighted items -7.7 -4.5 40.9

Operating income 19.6 27.5 40.5

Income from participations 1.2 0.1 -89.3

EBIT 20.9 27.7 32.7

EBIT Margin 5.8% 7.7% 1.9pts

Financial result -6.6 -2.8 56.8

Income before tax 14.3 24.8 73.8

Tax on income -5.1 -9.3 -83.3

Tax rate 35.6% 37.6% 2.0pts

Consolidated total income 9.2 15.5 68.6

Earnings per share 0.17 0.40 135.3


Highlighted items

In m€2015Q1

2016Q1

Write-ups and write-downs of additional assets

identified on acquisitions-1.3 -1.0

Income and expenses in connectionwith share and asset deals

0 -1.7

Income and expenses in connectionwith reorganization and improvement projects

-5.1 -1.3

Personnel expenses for share-based incentive payments -0.6 -1.0

Currency conversion differences -0.5 1.0

Income and expenses related to one-off effectsand other exceptional circumstances

-0.2 -0.5

Total highlighted items -7.7 -4.5


Cash flow

In m€

2015

Q1

2016

Q1 Changes

Consolidated total income 9.2 15.5 6.3

Amortization (incl. reversal) 15.3 17.0 1.7

Changes in inventories, receivables, payables 2.1 18.5 16.4

Others -1.4 3.6 5.0

Interest result 4.1 3.7 -0.4

Taxes paid -10.3 -11.7 -1.4

Cash flow from operating activity 19.0 46.6 27.6

CAPEX -20.3 -18.6 1.7

Acquisitions, other financial investmentsand asset disposals

-5.9 -22.1 -16.2

Free cash flow after acquisitions,other investments and asset disposals

-7.1 6.0 13.1

Cash flow from financing activity 36.3 191.2 154.9


1 Rounding differences possible

In m€1 31.12.2014 31.12.2015 Q1-2016 April 2016

< 3 Years 62% 53% 41% 16%

> 3 Years and < 12 Years 38% 47% 49% 84%

Total debt (gross) 389 437 635 461

Cash [93] [130] [324] [126]

Bank debt (net) 296 307 311 335

IFRS debt (net) 393 400 405

Net Debt to EBITDA (IFRS) 1.94 1.73 1.69

RCF/Credit Lines 279 286 296 286

31

1411

43 51

22

27

Funding structure

in %

Bond

Schuldschein fix

Bank loans

Schuldschein floating

Maturity profile of financial debt and Net Debt to EBITDA improved


GuidanceMatthias Hartmann, CEO


Guidance 2016

• The year started in line with expectations. Sales coverage as at the end of March 2016 was

60.8% of predicted annual sales (2015: 60.4%), which is well in line with historic range of 56%

to 63% over the last 5 years.

• In 2016 the Group anticipates a modest organic growth higher than in the previous year and

above the market research industry.

• The AOI (Adjusted Operating Income) margin should increase considerably.

Start of the year 2016

Guidance


Q&AMatthias Hartmann, CEO



GfK Investor Relations Team

[email protected]

http://twitter.com/GfK

+49 911 395 – 2012

STAY IN TOUCH WITH US


Key financial dates to remember

Annual General Meeting May 20, 2016 Fuerth/GE

H1/ Half Year Results 2016 August 12, 2016 Available online on gfk.com

Q3/ Nine Months Results 2016 November 14, 2016 Available online on gfk.com

Trading Statement January 31, 2017 Available online on gfk.com

Annual Report 2016 Accounts Press conference

March 14, 2017 Available online on gfk.com

Q1/ First Quarter Results 2017 May 15, 2017 Available online on gfk.com

Annual General Meeting May 18, 2017 Fuerth/GE

H1/ Half Year Results 2017 August 14, 2017 Available online on gfk.com

Q3/ Nine Months Results 2017 November 13, 2017 Available online on gfk.com

Please contact [email protected] for further information on any of the publications or events


Events to remember

RoadshowMay 31,June 1, 2016

Edinburgh,London/UK

DB German Swiss & Austrian Conference

June 8, 2016 Berlin/GE

Roadshow June 22, 2016 New York/US

Please contact [email protected] for further information on any of the publications or events

GfK Q1 20160513 · 5/13/2016 · © GfK 2016 | Q1 2016 Results Presentation | May 13, 2016 1 FIRST...

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