Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s...

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Introduction to Entertainment One Investor overview

Transcript of Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s...

Page 1: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Introduction to Entertainment One Investor overview

Page 2: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

eOne is a leading global entertainment company

1 Underlying EBITDA is profit before tax, before one-off items, share-based payment charges, net finance charges, depreciation and amortisation of acquired intangible assets

For the purposes of this analysis, ‘pro forma’ includes the results of Alliance, which was acquired on 8 January 2013, as if this business had been acquired on 1 April 2012

Group overview

► Entertainment One Ltd. is listed in London, a constituent of the FTSE 250 Index capitalised at around £850m

► Produces and acquires entertainment content rights for exploitation across all consumer media globally

► Owns a substantial content library: 35,000+ film and TV titles, 2,800+ hours of TV programming and 45,000+ music

tracks, valued at $650m+

Film Television

► Acquire

► Produce

► Market

► Distribute

► Produce

► Acquire

► Distribute

► License

FY2014 pro forma underlying EBITDA

FY2014 pro forma revenue

Film 80%

TV 20%

Film 75%

TV 25%

Page 3: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Our strategy

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Grow content

portfolio

Create future value by growing a

diversified film and TV rights

portfolio

Extend global

content reach

Expand reach of content by both

geography and content platform

Enhance

investment

returns

Use size and scale to drive improved

financial returns

Long-term

financial

goals

• EPS growth

• Return on capital

employed

• Cash

conversion

Page 4: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Substantial content library, low-risk portfolio approach

3

Investment in…

► Portfolio approach

► Not reliant on “hits”

► Large proportion of revenues

derived from prior year

investments (i.e. library titles)

► Delivering consistent

portfolio return on

investment

…content portfolio… …mitigates individual

title risk

FILM

35,000+ film and

TV titles

TELEVISION

2,800+ hours of

TV programming

FILM

270+ theatrical

releases per year

TELEVISION

300+ half-hours of

production per year

Page 5: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Revenue1

£m

Financial snapshot

4

Investment in content and productions £m

Underlying EBITDA2

£m Library value3

$USm

175 220

250

385

650

2009 2010 2011 2012 2013

1 Pro forma/constant currency financials adjusted for the results of Alliance Films Holdings Inc. (‘Alliance’), which was acquired on 8 January 2013, as if that business had been acquired on the first day of

the comparative period. Constant currencies have been calculated by retranslating the comparative figures using monthly average exchange rates for the year to 31 March 2014. 2 Underlying EBITDA is profit before tax, before operating one-off items, share-based payment charges, net finance charges, depreciation and amortisation of acquired intangible assets. 3 2014 independent library valuation is currently being finalised.

25.3

35.3 42.5

52.6

62.5

74.6

92.3

2009R 2010R 2011R 2012R 2013R 2013P 2014R

324.6

419.0 469.7

502.7

629.1

800.7 819.6

2009R 2010R 2011R 2012R 2013R 2013P 2014R

47.8

74.7 91.3

135.8

175.0

214.2

271.2

2009R 2010R 2011R 2012R 2013R 2013P 2014R

Page 6: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Film

Investor Presentation

2013 5

Page 7: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

eOne’s is the world’s largest indie movie distributor

6

Film distribution Film production

US

Ma

jors

In

dep

en

den

ts

Page 8: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Key Film industry trends

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Indie content

in demand

International

markets

Scale drives improved content purchasing

power and incremental margin

Indie producers are seeking overseas

markets for growth, but lack distribution

infrastructure

Indie producers stepping into the gap,

with eOne distributing high quality titles

for them

eOne provides the route into international

markets for indie producers

eOne’s EBITDA margins will continue to

expand as economies of scale achieved

Key trend Opportunity for eOne

Hollywood major studios focusing more on

blockbusters, avoiding ‘smaller’ releases

Size and

scale

Page 9: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

eOne Film outlook and growth opportunities

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Grow

content

portfolio

• Investment in Film content set to grow to over £200m in FY2015

• Over 275 movies planned for release during FY2015

• Continued expansion of movies from eOne Film Production

Enhance

investment

returns

• eOne’s leading position in its core markets underpins scale

• Drive economies of scale and increase EBITDA margins further

Extend global

content reach

• Grow presence in digital markets

• Expand geographic activities through growth in International Film

and Film Production activities

Page 10: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

9

Investor Presentation

2014

Television

Page 11: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Key Television industry trends

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Changing

viewing

habits

Incumbent pay-TV networks fearful of cord

cutting subscribers migrating to digital

Growth in digital content being powered by

online content platforms

Strong demand for content to satisfy this

consumption

As these platforms expand globally, eOne

is well-placed to provide the content for

their services

eOne can develop high quality content for

these platforms too

Key trend Opportunity for eOne

More content, consumed by more viewers

on more platforms than ever before

Cord cutting

Digital

explosion

Page 12: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

eOne’s TV model: driving return on investment

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Ultimate revenues

• Primary broadcast

licence

• International TV

sales

Global ancillary

revenues

• DVD/VOD

• Pay-TV/SVOD

• Free to air TV

Library deals

Syndication Output deals with cable networks

Content

access

Content

monetisation

globally

Production and acquisition Distribution Investment return

Develop and produce content

• Original development

• Co-production

• Co-development

• First-look

Beneficial funding

Page 13: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

eOne Television outlook and growth opportunities

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Grow

content

portfolio

• Increase investment in content

• Current year re-commissions underpin revenues

• New eOne Family programming in production

Enhance

investment

returns

• Drive operational efficiencies

• Higher margin L&M activities continue to build

• Syndication deals improve margins further

Extend global

content reach

• New output, co-production and co-development deals

• Peppa Pig launching into new markets

• Syndication opportunities

Page 14: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Summary

Page 15: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Investment summary

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► Huge global demand for content – from existing and new platforms

► eOne is at the centre of multiple, long-term growth trends driven by digital

► Compelling, low risk growth strategy

► Significant scale advantage, few competitive peers

► Confident trading outlook, progressive dividend declared

Page 16: Introduction to Entertainment One · Film Investor Presentation 2013 5 . eOne’s is the world’s largest indie movie distributor 6 Film production Film distribution jors ts. Key

Important Information

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This confidential presentation (including any accompanying oral presentation, question and answer session and any other document or materials distributed at or in connection with

this presentation) (the “Presentation”) has been prepared by Entertainment One Ltd. (the "Company"), and contains confidential information regarding the Company. It is provided

for the exclusive use of the persons attending the Presentation.

This Presentation does not contain or constitute an invitation or inducement to any person to underwrite, subscribe for or otherwise acquire or dispose of any securities in the

Company or otherwise and should not be relied upon for such purposes.

The distribution of the Presentation in certain jurisdictions may be restricted by law and therefore persons into whose possession this document comes should inform themselves

about and observe such restrictions. Any person who receives this Presentation in violation of such restrictions should not act upon it and should return it to the Company

immediately. The Presentation is not directed to, or intended for distribution or use by any persons or entity that is a citizen or resident or located in any locality, state, country or

other jurisdiction where such distribution or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction. In particular, this

Presentation (and the information contained in it) is not for release, publication or distribution, directly or indirectly, in the United States (or for the account of any "U.S. Person" as

defined in Regulation S under the US Securities Act 1933), Australia, New Zealand, Canada, Japan or South Africa.

No representation, warranty or undertaking, express or implied, or liability or duty of care is or will be given by the Company or its representatives as to the fairness, reliability,

omission of, or reasonableness, accuracy or completeness of the information or opinions in the Presentation or any other written or oral information made available to any interested

party or its advisers, without prejudice to any liability for, or remedy in respect of, fraudulent misrepresentation. In particular, but without prejudice to the generality of the foregoing, no

representation or warranty is given as to the achievement or reasonableness of any future projections, management estimates, prospects or returns contained in the Presentation or

in such other written or oral information. To the fullest extent possible, by attending this Presentation each Recipient releases the Company and each of its representatives in all

circumstances (other than fraud) from any liability. Accordingly, the Company or its representatives shall not be liable for any direct, indirect or consequential loss or damage suffered

by any person as a result of relying on any statement in or omission from this Presentation or in any other information or communications in connection with the Presentation.

This Presentation includes “forward-looking statements”. All statements other than statements of historical facts in this Presentation, including, without limitation, those regarding the

future financial position, objectives, development and strategies of management for future operations of the Company are forward-looking statements. The Company uses the words

“anticipates”, “estimates”, “expects”, “believes”, “intends”, “plans”, “may”, “will”, “should” and any similar expressions to identify forward-looking statements. Such forward-looking

statements involve known and unknown risks, uncertainties and other factors, many of which are beyond the Company's control, which may cause the Company's actual results,

performances or achievements of its results, or industry results, to be materially different from any future results, performances or achievements expressed or implied by such

forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the

environment in which the Company will operate in the future. The information contained in this Presentation speak only as at the date of this Presentation. The Company is not

obliged, and does not intend, to update or correct any inaccuracies in this Presentation or realise any forward-looking statements, whether as a result of new information, future

events or otherwise except to the extent required by any applicable law or regulation.