M E D I A S E T G R O U P

Transcription

1 M E D I A S E T G R O U P

2 2000: A Memorable Year Leadership in terms of audience Leadership in terms of advertising revenues Careful control of costs Development of multimedia MEDIASET GROUP

3 2000: A Memorable Year Free-to-air generalist television will continue to play a central role in the media system Il Grande Fratello (Big Brother): the ante-chamber of convergence Television - a bridge connecting different media MEDIASET GROUP

4 2000: A Memorable Year: Results Consolidated net revenues: 2,363.6 m Euro (+15.4% vs 1999) Operating profit: m Euro (+23.4% vs 1999) EBIT Margin up from 27.3% to 30.1% Net profit: m Euro (+ 24.9% vs 1999) MEDIASET GROUP

5 New Media The Internet Cost-conscious investment strategy (light structure) Business approach based on interaction with and within television (TG5 & TG.COM) Thematic channels Low cost of conception and packaging MEDIASET GROUP

6 Diversification (Television is the hub) The core business will remain at the heart of the coming transformations Viewers will become less passive more interactive Enhanced TV: agreements and alliances with telecom companies to build an integrated platform MEDIASET GROUP

7 Regulatory Scenario March 2001: Law approved for the shift to digital terrestrial This means: A precise time frame for the change-over Testing to be carried out by incumbent licence-holders The possibility of buying frequencies A reserve of 60% of additional broadcasting capacity allocated to the licence-holders that launch testing MEDIASET GROUP

8 Conclusions Core Business: Dependability and continued value creation TV: the key element in the development of digital technology and interactivity Content provider International partnership Leadership in digital TV MEDIASET GROUP

9 B R O A D C A S T I N G

10 Summary 2000 Results Programming Strategy Costs Control: Efficiency and Performance Improvement 2001 Objectives BROADCASTING

11 Mediaset Total Viewers (%) 2000: Best Result of the Last 6 Years Daily audience share (24 hours) '99 00 Soccer European Championship + Olympics Soccer World Championship Soccer European Championship +Olympics BROADCASTING

12 Canale 5 Total Viewers (%) 2000: Best Result in the Auditel Age Daily audience share (24 hours) ' '99 00 BROADCASTING

13 Editorial Strategy Three Networks, One Television Leadership/Co-leadership in Individuals Target Leadership in Commercial Target Leadership in Young Target (Children, 15-24yrs, 25-34yrs) Focus on RAI Targets BROADCASTING

14 Editorial Strategy Three Networks, One Television Wider offer for viewers Better service for ad investors Effectiveness and Efficiency Co-ordination in programming to optimize costs BROADCASTING

15 Channel Positioning Three Networks, One Television ITALIA 1 RAI 2 TMC Female e Mal CANALE 5 RAI 3 TOT. AUDIENCE RETE 4 RAI 1 Young Adults BROADCASTING

16 Channel Positioning Three Networks, One Television 2000 Daily audience share % COMMERCIAL TG. (15-64 yrs) Canale 5 Rai 1 Rai 2 Italia 1 Rai 3 Rete 4 Tmc YEARS YEARS >65 YEARS Canale 5 Italia 1 Rai 2 Rai 1 Rai 3 Rete 4 Tmc Canale 5 Rai 1 Italia 1 Rai 2 Rai 3 Rete 4 Tmc Rai 1 Canale 5 Rai 2 Rete 4 Rai 3 Italia 1 Tmc BROADCASTING

17 Programming Strategy Maximum Efficiency & Performance Improvement Increase in in-house production hours (Fiction & Entertainment) Reduction in high-cost and low-profitability products (Champions League) Revenues from the sale of programming rights BROADCASTING

18 Cost of Programming & Commercial Productivity: Examples AVERAGE AUDIENCE PER MINUTE PRODUCT COST INDEX GRP INDEX Champions League match 24/5/00 Real Madrid - Valencia 5, Film 20/3/00 Independence Day 5, Fiction 27/4/00 Valeria Medico Legale 5, Entertainment 13/2/00 La sai l ultima? 5, *127 *excluding TV promotions BROADCASTING

19 Cost of Programming Examples: Canale 5 Programming in Autumn 2000 SUN MON TUE WED THU FRI SAT Forecast In-house Film Champ. Champ. Fiction In-house In-house Broadcast Fiction Big Broth Total saving Total GRP -16 million Euro +72% BROADCASTING

20 Cost of Programming & Mediaset Group Net Revenues +8.8% +10.4% +8.6% +5.7% +11.5% +5.2% Net Revenues Cost of Programming '99 00 BROADCASTING

21 Cost of Programming 2000 vs. 1999, 1999 vs. 1998, 1998 vs vs vs vs. 99 Total costs before sale of rights +10.4% +8.2% +7.6% Revenues from sale of rights (m Euro) Total costs after sale of rights +10.4% +5.7% +5.2% BROADCASTING

22 2001 Objectives Control of Programming Costs Management Strategy Development = Brand Extension BROADCASTING

23 Control of Programming Costs % costs increase lower than % adv. revenues increase Tactical Cancelling or postponing some productions: Prime time specials Day time specials Strategic Long series prod. vs. Rights acquisitions Joint-venture production Development of in-house formats Revenues from the sale of programming rights BROADCASTING

24 Management Strategy Internal Growth Motivation Team working Cost control Innovation Consistency with our strategy: Three Channels, One Television BROADCASTING

25 Development= Brand Extension Free TV is fundamental to launch/sustain new products Mediaset (43% share) either owns or can build strong brands Brand extension activities have 3 main objectives: - to create incremental revenues - to optimize internal resources - to reinforce Generalist TV BROADCASTING

26 Brand Extension Example 1.Free Programming 6. Press (weeklies/monthlies) 5. Events Brand Extension 2.Thematic Digital Channel 3. Internet 4. Merchandising BROADCASTING

27 2001: January - March audience share 24 hours vs 2000 Prime Time vs 2000 MEDIASET RAI CANALE RAI Source: Auditel (at 10/3/01) BROADCASTING

28 A D V E R T I S I N G

29 Summary 2000 Achievements 2001 Initial Results Future Developments ADVERTISING

30 Summary 2000 Achievements 2001 Initial Results Future Developments ADVERTISING

31 Publitalia: TV Advertising Revenues in 2000 (million Euro) ,467 2, ADVERTISING

32 Excellent Results for the 3rd Consecutive Year (million Euro) m Euro ADVERTISING

33 Tv Market Growth versus previous year TOTAL MARKET PUBLITALIA SIPRA TMC +12.4% +12.6% +12.0% +10.5% Source: Nielsen ADVERTISING

34 Publitalia s Competitive Capacity FIRST 9 MONTHS +16.0% +15.4% LAST 3 MONTHS +6.0% +3.8% TV MARKET PUBLITALIA TV MARKET PUBLITALIA Source: Nielsen ADVERTISING

35 A Fundamental Support: Our Audience Share October - December: Mediaset leader in 24 hours MEDIASET RAI % vs 2000 % vs hours Prime time Day time Source: Auditel; Target Individuals ADVERTISING

36 Tv Consumption (minutes per day) + 2.7% Source: Auditel - Target individuals ADVERTISING

37 Tv Viewers (daily million) + 4.5% ADVERTISING

38 Publitalia: Advertising Demand Trend ACTIVE CLIENTS NEW CLIENTS IN ,044 New Clients ,045 Revenue 180 m Euro Average Inv. 0.6 m Euro ADVERTISING

39 Mediaset: Advertising Investments by Sector (million Euro) 2000 %vs 99 GROCERY NEW SECTORS AUTOMOTIVE OTHERS 1, % +58.8% +8.9% +3.8% ADVERTISING

40 Mediaset: Focus on New Sectors (million Euro) 2000 % vs 99 TELECOMS % FINANCE/INSURANCE % ADVERTISING

41 Mediaset: Advertising Investments by Sector GROCERY OTHER SECTORS GROCERY OTHER SECTORS AUTOMOTIVE AUTOMOTIVE NEW SECTORS NEW SECTORS ADVERTISING

42 Mediaset: New Media Revenues (in million Euro) m Euro % INTERNET MEDIAVIDEO ADVERTISING

43 Mediaset: 2000-year Growth (in million Euro) OTHERS MEDIAVIDEO INTERNET 4 ADVERTISING BOARD TV 268 ADVERTISING

44 Summary 2000 Achievements 2001 Initial Results Future Developments ADVERTISING

45 Telecinco: Audience Share Trend TVE ANTENA % Total Audience % Commercial Target TELE Commercial Target: years, high, middle and mid. low income for towns > pop ADVERTISING

46 Spanish Tv Advertising trend 2000 vs 1999 in million Euro 2,041 2, % % % +15.6% TOTAL NATIONAL TV TVE ANT3 TELE5 ADVERTISING

47 Telecinco Financial Results Consolidated pro-forma figures (in million euro) Net consolidated Revenues % Operating costs (350.5) (368.6) +5.2% EBIT % Pre-Tax Profit % Net Profit % ADVERTISING

48 Telecinco: One of the Most Profitable Free Tv in Europe (in million euro) 39.6% Ebit Margin 27.0% 31.6% ADVERTISING

49 Summary 2000 Achievements 2001 Initial Results Future Developments ADVERTISING

50 Market Reference Framework Increase in Consumption Propensity «One should spend everything, without caring about saving» (% very+quite favourable) «One should buy only what is really needed» (% very much favourable) Source:GPF & A. ADVERTISING

51 Market Reference Framework Advertising: an increasingly fundamental asset «I have recently hesitated before letting myself be influenced by advertising» (% favourable) «Advertising can help in making a product selection» (% very favourable) Source:GPF & A. ADVERTISING

52 Publitalia Bookings - Jan./ Feb (million Euro) m Euro % ADVERTISING

53 Publitalia: First-2-months Positive Aspects ACTIVE CLIENTS BANK/INSURANCE SECTOR AUTOMOTIVE MARKET GROCERY SECTOR FOOD SECTOR % +15.7% +7.8% +15.5% ADVERTISING

54 Mediaset: an Important Contribution from Audience Share 2001: Mediaset Leader in Prime Time PRIME TIME 24 HOURS JAN. FEB. JAN. FEB. MEDIASET RAI Source: Auditel; Target Individuals ADVERTISING

55 Mediaset: an Important Contribution from Audience Share 2001: Canale 5 Undisputed Leadership PRIME TIME 24 HOURS JAN. FEB. JAN. FEB. CANALE RAI Source: Auditel; Target Individuals ADVERTISING

56 Canale 5 s Brand Perception Canale 5 is the network: 1991% 2000 % 00 vs 91% I would be least willing to give up Most in tune with audience needs With the newest, up-to-date programmes I watch most often That will be most successful in the future Source:GPF & A. ADVERTISING

57 Mediaset: New Media Revenues (Jan.-Feb. 2001) (million Euro) INTERNET m Euro % 0.7 MEDIAVIDEO ADVERTISING

58 Summary 2000 Achievements 2001 Initial Results Future Developments ADVERTISING

59 The New Scenarios After the Start of Digital Terrestrial Broadcasting By 2010 Tv will be digital New national and international players DTT will entail a Tv evolution Mediaset will remain a major player ADVERTISING

60 Our Mission : to Become Leader in Digital TV To strengthen our leadership in the core business: Italy and Spain To play a leading role in the new opportunities offered by digital THEMATIC CHANNELS INTERACTIVITY ADVERTISING

61 Our Mission : to Become Leader in Digital TV CORE BUSINESS To maintain the acquired levels of profitability (cost control) and to continue to innovate both in content and advertising. To exploit the potential of our brands (merchandising) DIGITAL OPPORTUNITIES To develop channels for specific targets To exploit the possibilities offered by interactivity To launch new services ADVERTISING

62 F I N A N C I A L 62

63 Mediaset Financial Overview Consolidated Full Year Results (m Euro) Net consolidated revenues 2,048.7 Operating costs (875.7) EBITDA 1,173.1 Amortization and depreciation (612.9) EBIT Pre-tax profit Net profit ,363.6 (1,006.4) 1,357.2 (665.7) % +14.9% +15.7% +8.6% +23.4% +10.5% +24.9% FINANCIAL

64 Mediaset Financial Overview Italian Business (m Euro) Total Net Revenues 2, , % Operating costs (875.7) (939.0) +7.2% EBITDA 1, , % Amortization & depreciation (612.9) (657.5) +7.3% EBIT % FINANCIAL

65 Mediaset Financial Overview Italian Activities Operating Profit (m Euro) 26.1% 27.3% 30.1% Ebit Margin dic dic dic.00 FINANCIAL

66 Mediaset Financial Overview Italian Business Revenues (m Euro) Advertising (third parties) 2, , % TV operations % Multimedia n.a. Non - TV operations (25.1%) Commissions (317.7) (354.7) +11.6% TOTAL Net Revenues 2, , % FINANCIAL

67 Mediaset Financial Overview Italian Business Operating Costs (m Euro) Labour cost trend % 279, % 289,3-0.4% 288, FINANCIAL

68 Mediaset Financial Overview Italian Business Operating Costs (m Euro) Commercial costs (82.0) (87.9) +7.3% In-house production (336.1) (383.9) +14.2% Transmission costs (28.8) (35.2) +22.2% Overheads (72.3) (85.7) +18.5% Multimedia activities (6.9) (18.6) n.a. Other non Tv costs (60.4) (39.4) -34.7% TOTAL Italian Costs (586.4) (650.8) +11.0% FINANCIAL

69 Mediaset Financial Overview Italian Business (m Euro) In-house production costs (336.1) (383.9) +14.2% In-house production costs (297.6) (313.5) +5.3% Tv concession fee (0.9) (16.2) n.a. SIAE costs (37.6) (42.2) +12.2% Soap costs* - (12.1) n.a. * In 99 Soap Opera costs were in TV rights amortisation FINANCIAL

70 Mediaset Financial Overview Italian Business (m Euro) Transmission costs (28.8) (35.2) +22.2% Capitalised Costs in n.a. Lay off provision --- (3.1) n.a. Total running comparable costs (31.9) (32.1) +0.6% FINANCIAL

71 Mediaset Financial Overview Italian Business (m Euro) Overheads (72.3) (85.7) +18.5% Witholding tax --- (7.6) n.a. Running costs (72.3) (78.1) +8.0% FINANCIAL

72 Mediaset Financial Overview Italian Business Amortisation and Depreciation (m Euro) DEPRECIATION AND OTHER AMORTISATION SPORTS % % ,3% TV RIGHTS AMORTISATION FICTION % FINANCIAL

73 Mediaset Financial Overview Financial income & Associated Companies (m Euro) Net financial income/charges Total Associated companies TELECINCO (40% stake) ALBACOM (19.5% stake) PKS Group (24.5% stake) BLU (9% stake) & others (19.3) --- (0.1) (52.4) (25.8) (5.2) (0.7) FINANCIAL

74 Mediaset Financial Overview Net Profit (m Euro) 17,9% Net profit Margin 15,1% ,6% Net Profit: % vs 1999 FINANCIAL

75 Financial Overview Cash flow statements (excl. Epsilon) (m Euro) Free Cash flow Cash flow from operations Investments (563.8) Others movements (160.3) Dividends (139.5) Equity movements 2.0 Total Net cash flow (14.9) (12.4) (1,384.9) (167.1) 2.0 (177.4) ,142.4 (799.3) (184.1) (216.2) 2.7 (54.5) FINANCIAL

76 Financial Overview Investments (m Euro) 1999 = 1, = Associates TV Rights Technical & immaterial FINANCIAL

77 Financial Overview Earnings per share (Lit.) TO BE APPROVED BY AGM 9 th April Number of shares (million) 1, , , ,181.2 Earnings per share Net dividend per share Pay out ratio 58.5% 58.8% 63.8% 67.0% FINANCIAL