INTRODUCTION INTRODUCTION BROADCASTING FRANCE ADVERTISING OTHER ACTIVITIES STRATEGY. Disclaimer. Summary

Transcription

1 Disclaimer All forward-looking statements are TF1 management s present expectations of future events and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. 1 2 Summary INTRODUCTION BROADCASTING FRANCE ADVERTISING OTHER ACTIVITIES STRATEGY INTRODUCTION 3 4 1

2 TF1 Group revenue New players on the market Broadcasting France TF1 Channel advertising Theme channels in France Téléshopping Internet TF1 Entreprises Other activities * Audiovisual rights TF1 Vidéo Catalogue ** International broadcasting 2,154 m 1,708 m 154 m 110 m 71 m 40 m 71 m 241 m 158 m 83 m 259 m The Telecom operators (fixed and mobile) include audiovisual contents in their offers An example: Orange Orange TV screen Livebox 2006 consolidated revenue 2,654 m * Mainly : in-house production companies (incl. GLEM, Alma, TF1 Films Production, TAP, TPP), other 5 revenue TF1 SA, TF1 Publicité ** Incl. TF1 International, TCM, Téléma Copyright : France Télécom (2006) 6 New players on the market Audiovisual contents are watched on every network The Telecom operators (fixed and mobile) include audiovisual contents in their offers December 2003 Launch of TV over ADSL by France Télécom and TPS TPS L December 2006 households receives TV over ADSL households equipped subscribers (Cable, TPS and Canalsat) households receives TV over ADSL people watches TV over mobile phones Source : Médiamétrie Q Source : GfK Q Médiamétrie Q REM - TSM 8 2

3 The key success factors The best news contents BROADCASTING FRANCE Far ahead of its competitors (+ 4.8 m viewers vs. the 1 o clock news bulletin of France 2 and m viewers vs. the 8 o clock news bulletin of France 2) Audiences above news bulletin of biggest US networks. The best sports contents The biggest events are on TF & & Copyright : 2007 FOA Ltd. - Fédération Française de Football UEFA 2007 all rights reserved 10 - FIFA 2007 all rights reserved - RWCL 2007 all rights reserved The key success factors The key success factors The best French TV dramas The best US series Exclusive productions strategy: Prestige dramas, 52 minutes dramas and recurrent heroes The best movies Contracts secured with US majors Investments in French movies: 48 m in out of the 10 best series in the US are on TF1 The best entertainment Sustainability of TF1 eventful shows Success of new access programmes in

4 TF1 : the best US series TV: the only mass media in France 7 out of the 10 best series in the US are on TF1 1 GREY'S ANATOMY 2 CSI (Les Experts) 3 Desperate housewives 4 CSI : MIAMI (Les Experts Miami) 5 LOST 6 CRIMINAL MINDS (Esprits criminels) 7 CSI : NY (Les Experts Manhattan) CBS 21.6 m 21.6 m CBS 17.6 m 17.1 m CBS 22.1 m 16.6 m CBS 16.4 m 8 NCIS 15.9 m CBS 9 HOUSE, MD (Dr House) 15.7 m 10 Two and a half men 15.5 m CBS Above Individuals 4+ watch every day! Source : Source Eurodata TV, all rights of reproduction reserved, all rights reserved by Mediamétrie 13(season as December 31, 2006) Source : Médiamétrie 2006 individuals aged 4 and above 14 TOP 100: a record since 1991! TF1: 98 positions in the top 100 out of the 100 best audiences for TF1 in French TV dramas Sports US Series Movies News * Entertainments RIS - 26 January 11.3 million viewers World Cup semi-final -5 July 22.2 million viewers CSI Miami -10 May 10.3 million viewers Les Bronzés font du ski - 31 January 12.4 million viewers 8 o clock news bulletin -12 March 11.5 million viewers Le Village des Enfoirés -7 April 10.9 million viewers 2 programmes complete this 2006 top 100: Les Choristes on France 2 (15 th ) and Louis la brocante on France 3 (75 th ) M6 first programme ranks 256 th Prison Break broadcast on November 8, 2006 Source : Médiamétrie Top individuals Source : Médiamétrie Top individuals 4+ * Only the first audience 16 of the news bulletin (1 o clock and 8 o clock) taken into account over the period 4

5 An unchallenged leadership on every network... TF1: an unchallenged leadership... Individuals 4+ Médiamétrie - Nov-Dec 06 - Indiv. 4+ (Audience share TF1 + TMC) 17 Mediacabsat 11 - Dec 05 / June 06 Indiv. 4+ (PdA TF1 + TF1 Group theme channels) w o sh 32,3 pt F2 S F3 13,8 2,9 2,0 Arte M6 11,2 pt ,7 10,9 pt 3,4 C+ s pt ,5 12,6-0.1 Audience share 2006 pt 12,6 pt 1,8 3,8 3,7 e lid ,5-0.3 t no 3,6 16,1 14,7 15,2 20,5 19,8 20,5 pt 1, ,2 14,7 31,8-1.3 ed 12,1 Audience share 2003 to ,6 3,0 pt ,5 Cable-sat environment 3,1 F5 Other TV Médiamétrie Médiamat - Indiv. 4+ (Audience share TF1) DTT environment Médiamat environment 3,1 Indiv Source : Médiamétrie - Médiamat... and on the main advertising target TF1 Group channels audience share Cable-sat environment 1.3% 1.1% 0.9% 0.8% 0.4% e lid 0.2% t o n 0.2% S 0.1% ow h s ed GROUP Médiamat environment Cable-sat environment Women < % 25.5% 0.1% 0.1% Médiacabsat 11 - Dec 05 / June 06 Indiv. 4+ (Audience share TF1 + TF1 Group theme channels)19 Médiamétrie Audience share 2006 (Audience share TF1) 20 Mediacabsat 11 - Dec 05 / June 06 (Audience share TF1 + TF1 Group theme channels) 5

6 ... and the main advertising targets... and the main advertising targets Women < 50 Individuals , pt 35,5 36,2 35,3 17,0-1.3 pt 17,1 16,3 15,7 12,2-2.1 pts 11,3 10,3 10,1 Audience share 2003 to 2005 Audience share ,9-0.8 pt 3,6 3,3 3,1-0.4 pt 1,4 1,4 1,3 1,0 18, pt 18,6 19,1 19,3 F2 F3 C+ Arte M6 F5 Other TV 2,7 0 pt 2,7 3,0 2, pts 10,0 9,7 10,6 12,7 32, pt 33,3 33,8 33,6 17,2-1.5 pt 17,3 16,6 15,7 12,5-1.8 pt 11,8 11,0 10,7 5,0 Audience share 2003 to 2005 Audience share pt -0.2 pt 4,8 4,5 4,2 1,5 1,7 1,6 1,3 17,1 16,8 17,1 17,1 F2 F3 C+ Arte M6 F5 Other TV 0 pt 2, pt 2,6 2,7 2, pts 11,6 11,7 12,7 14,7 Source : Médiamétrie - Médiamat 21 Source : Médiamétrie - Médiamat 22 TF1: Leader on every target Historical record of audience for the World Cup semi-final France - Portugal TF1 audience share Advertising targets Age bracket 4+ Wom< Wom+child Rop<60* AB+ 31,6 35,3 30,7 33,9 33,1 32,0 29,2 Challenger F2 M6 M6 M6 F2 F2 F2 28,6 37,4 33,6 33,5 M6 M6 F2 F2 Advance of TF pts pts pts pts pts pts +2.8 pts pts pts pts +9.3 pts Source : Médiamétrie Médiamat * Responsible Of Purchases 23 Source : Médiamétrie July 5, 2006 Individuals

7 A more and more attractive prime time TF1 strengthened its leadership in evening viewers on average vs with 7.5 million Individuals on average (32.8% audience share) - best audience in prime time since 1994! 2006 TF1 : leader on 95% of prime-time (vs. 92% in 2005) viewers in Prime-time (vs. 2005) with 7.5 million Individuals on average (32.8% audience share) i.e. the best audience recorded since 1994 A RECORD of audience for the Second-time since the creation of the Médiamat (1989) with 3.4 million Individuals on average (with 35.0% audience share) Source : Médiamétrie 2006 vs individuals Source : Médiamétrie Médiamat (Prime-time : TH 21h00-22h45 Second-time : 22h45-24h30) 26 and it lasts over the first weeks of 2007 * Leading theme channels The 25 best audiences of 2007 are on TF1* (vs. 24 in 2006) Already 16 programmes above 9 million viewers Record for a US Series* since 1995 CSI Manhattan 10.9 m viewers on February best audience* TF1 8 o clock news bulletin 11.0 m viewers on January 24 Best audience of movie* (4 th place in the top 2007) Tais-toi! 10.5 m viewers on January 28 Source : Médiamétrie / Médiamat - * from Jan 1 st to Feb 12, 2007 (temporary figures before the update 27 of the INSEE data base) Source : Médiamétrie Mediacabsat 11 (Dec 05 June 06) Ind

8 Theme channels : a multi-channel strategy TOP 10 - theme channels 1 st DTT channel 1 st cable and satellite channel on Women < 50 1 st cable and satellite channel 1 st news channel on AB+ 3 rd cable and satellite channel on Channels RTL 9 Canal J Paris Première Tiji Canal+ Sport Audience share 2.3% 1.5% 1.3% 1.1% 1.1% 1.0% 1.0% 0.9% 0.9% 0.8% Source : Médiamétrie Médiamat and Médiacabsat Source : Médiamétrie Mediacabsat 11 (Dec 05 June 06) Ind TF1 Group theme channels in France 2006 revenue TF1 Group theme channels revenue 2008 revenue target 139 m 128 m 154 m

9 TF1 Group theme channels operating profit TV: the only mass media in France 2008 operating margin target m m m The best of every genre of programmes on TF1 An unchallenged leadership on every network and every target Records of audience in 2006 A more and more attractive prime time Leading theme channels advertising growth ADVERTISING GDP growth in

10 TF1 : an advertising market share in increase 2006 advertising market share France 5 1.0% (-) Canal+ 2.0% (- 0.2 pt) France 3 7.3% pt M6 23.1% - France % -0.2 pt 54.8% pt Source : TNS Media intelligence Source : TNS Media intelligence TF1 : exclusivity of powerful ad breaks % of ad breaks split by audiences of the ad breaks above 12 GRP on TF1 France 2 France 3 Canal + France 5 M <2 2 to to to to to 11.9 >=12 Source : Médiamétrie Women < Source : Médiamétrie Women <

11 ad breaks : efficient on every target Launch of Windows Vista in France Average audience (%) of ad breaks per channel and per target in 2006 whole day Wom < Men < France 2 France 3 M6 Wom with child AB+ Source : Mediamétrie / year 2006 / average audience in % of the targeted population 41 Copyright : 2007 Microsoft Corporation. All Rights Reserved. 42 Innovation: live TV advertising January 2007: first steps for retailers on TV Investments on TF1 * 16.6 m (gross) invested in January 2007 Coverage rate: 100% * 15 advertisers on TF1 TF1 advertising market share on the retail sector (excl. Mistergooddeal) * 43 Source : TNSMI January 2007 * Coverage rate and market share calculated excluding Mistergooddeal 44 (M6 Group) 11

12 January 2007: first steps for retailers on TV Increase of retailers brand awareness Retail on TV : an efficient start => A high level of memorisation by viewers => Strong increase of the retailers brand awareness Up to +10 points of spontaneous brand awareness TV advertising generated an increase of retailers brand awareness Spontaneous brand awareness: December 2006 January 2007 Auchan Carrefour Casino Marque Repère (Leclerc) Système U 35% 42% 42% 47% 23% 18% 22% 32% 9% 14% Sofres survey in 2 waves / end Dec 06 and Jan 07 / 250 people interviewed 45 Source : LSA Conference February Theme channels: a market by itself Internet: a booming market Market: 3.8% of the total gross investments The 2 most invested channels TF1 Pub rev TF1 Publicité advertising agency: 2006 vs % Market share: close to 1/3 of the theme channels market An exclusive choice for 361 advertisers Complementary portfolio of sectors Rank on theme channels Sectors Rank on TF1 1 Transport Food 1 Services Culture and leisure Telecommunications Market: 10.1% of the total gross investments Position of TF1 Publicité: TF1 Pub rev 2006 vs th most invested advertising agency of the market + 125% 376 advertisers on TF1 network i.e advertisers in 2006 Complementary portfolio of sectors Rank on Internet Sectors Rank on TF1 1 Retail Telecommunications 4 Services 6 Cosmetics 2 Transport 5 Source : TNS MI 47 Source : TNS MI 48 12

13 OTHER ACTIVITIES AUDIOVISUAL RIGHTS nd editor of the French market * A new way of video consumption 13.2 m DVD sold in 2006 (+13%) 23.1 m End 2005: launch of the TF1 VOD website End 2006: agreements signed with Neuf Cegetel and Free Number of DVD/K7 sold in million * Source : SEV 2006 (rent and sale)

14 One of the first distributors in theatre Hors de Prix: 2.0 million viewers The Departed: 1.8 million viewers Eurosport International key figures A 4.9% increase of the number of households receiving the channel in Europe 2006 key figures * Revenue: m (+ 6.5%) Operating result: 29.7 m (- 0.7%) Operating margin: 11.5% households receive Eurosport in Europe * as of December 2006 including 62.6 million paying subscribers * Contribution of Eurosport International to TF1 Group consolidated financial statements 55 * Including Eurosport France 56 14

15 An extending coverage Successful developments 7 linguistic versions households as of December 2006 (mainly paying subs) 18.8 million of visitors per month (December 2006) Organiser of sports events A world championship WORLD TOURING CAR CHAMPIONSHIP: 11 stages of car races revenue in 2006 New events in 2007 INTERCONTINENTAL RALLY CHALLENGE: 9 rallies on 3 continents INTERNATIONAL FORMULA MASTER: 8 races of single-seaters on circuit A successful implementation of the channel Eurosportnews subs in Asia at end 2006* Launch in 2006 of a channel dedicated the Asia/Pacific** => Target: position Eurosport on the multisport and live events channels Make a worldwide brand with Eurosport and set up a sustainable group in this promising area Through major international events Target : All media rights New revenue (field marketing) Target: South-East Asia GLOBAL CHAMPIONS TOUR: 8 jumping horse-riding shows 5 stars 59 * Number of subs to Eurosportnews in Asia at end ** Hong-Kong, Singapore, Malaysia, Australia, Indonesia... 15

16 European sports website Target: become the n 1 sports website in Europe! Year BBC UK (excl. homepage) 2 Yahoo! Sports 3 Eurosport 4 Yahoo! FIFA World Cup 5 Sky Sports 6 Sport 1 online 7 AOL Sports Unique visitors * 5,802 5,469 3,834 3,495 3,406 2,963 2,577 Sports reach ** 8.3% 7.9% 5.5% 5.0% 4.9% 4.3% 3.7% Eurosport.com: 3 rd sports website in Europe Source : comscore * Monthly average in thousands ** Audience 61share among sports websites in Europe (sports reach) Copyright : 2007 Yahoo Inc. All Rights Reserved. 62 Success of Internet and other developments Internet activity in 2006: + 52% TELESHOPPING 2006 revenue from new businesses: > 10 m (surinvitation.com, Infomercials, shops) 2006 revenue

17 Strong growth prospects Aggregated revenue of the last 3 years Target of aggregated revenue for the next 3 years INTERNET Outperforms the market The Internet revolution! tf1.fr network: 13 th French website* in terms of audience Strong growth of advertising revenue Audience: Internet market: + 21% - tf1.fr network: + 72% ** Medium term operating margin target > 10% Audience of the Network * *January 2007 ** Number of unique visitors - Source : Médiamétrie / Xiti / panel NielsenNetRatings / Cyberstat 67 Dec 06 vs. Dec

18 69 Copyright : 2007 Microsoft Corporation. All Rights Reserved. 70 STRATEGY Copyright : 2007 Microsoft Corporation. All Rights Reserved

19 An organisation by line of products Target Networks With contents customized to each and every platform on every business TV Internet Mobility TF1 channel n 1 5 theme channels in the top 10 1st media website 13th website in France 3rd editor of mobile contents Commerce Be leader Genres Sport News Cinema/Series Dramas Music / Games Entertainment Mobile & Podcast 1st youth website Youth News Cinema Internet 75 DVD-VOD Theatre TV TV Mobility Podcasts Launch of youth Podcasts 76 19

20 Strategic issues Conclusion Reinforce the share of voice of the Group Develop new activities Secure the access to multi-platforms rights Implement a strategy of multi-supports contents around key genres (news, sport, cinema...) Dynamise the International development Increase the Group profitability Be leader on every business TPS FY 2006 accounts As of 31/08/ Further to the approval of the Minister of the Economy, Finance and Industry, TF1 does not have any more the control of TPS - Deconsolidation of TPS in the financial statements as of 31/08/2006 As of 31/12/ TF1 brings its 66% stake in TPS to Canal+ France - TF1 gets in return a 9.9% stake in Canal+ France + put option exercised in February 2010 with a floor valuation of 746 m. 04/01/ Final agreement aimed at bringing together the pay TV businesses of Group Canal+ and TPS in France, in Canal+ France, new group controlled by Vivendi - Reimbursement of the 99 m advance (interests included) to Vivendi Impact of the sale of TPS on the financial statements Profit of discontinuing operations as of 31/12/2006: m (incl. share of result of TPS as of 31/08/2006: 41,8 m). 9.9% of Canal+ France in the balance sheet under non current financial assets: 629 m. 2007, 2008, 2009: change of the fair value of the put option booked in other non current operating income and expenses

21 Key events TF1 gross margin operational breakdown Minority stake in AB Group m Change % December 2006: TF1 takes, under conditions, a 33.5% financial minority stake in AB Group for 230 m. Impact on the 2006 financial statements: no impact Consolidation in 2007 under associates Acquisition of 95% of 1001listes by Téléshopping Consolidation as of 31/12/2006 under the full consolidation method Impact on the balance sheet: Goodwill: 23.9 m Net debt: m TF1 channel advertising revenue Advertising agency fees Authors CNC TDF / Satellites / Transmissions Net revenue from broadcasting Programming costs (excl. Football World Cup) 1,707.9 (81.0) (66.6) (84.8) (53.5) 1,422.0 (946.5) 1,647.5 (86.5) (63.2) (81.7) (54.9) 1,361.2 (919.4) (3.4) (3.1) (27.1) Football World Cup cost (113.6) % (6.4%) 5.4% 3.8% (2.6%) 4.5% 2.9% - Impact on the P&L: No impact Gross margin (79.9) (18.1%) TF1 channel programming costs m Change % Entertainment (7.6) (2.8%) TV dramas and series % Sports (excluding Football World Cup)) % News (2.2) (1.9%) Movies (3.4) (2.9%) Youth % Total programming costs (excl. Football World Cup) % Football World Cup Total programming costs (incl. Football World Cup) 1, %

22 Consolidated income statement (1/2) Consolidated income statement (2/2) m Change % m Change % Revenue Other operating revenue External production costs Other purchases and changes in inventories Staff costs External expenses Taxes other than income taxes Depreciation and amortisation net Provision net Other operating income and expenses Current operating profit Operating margin (% of revenue) 2, , % (0.1) (20.0%) (608.7) (648.9) 40.2 (6.2%) (581.4) (395.8) (185.6) 46.9% (382.7) (362.1) (20.6) 5.7% (504.7) (475.3) (29.4) 6.2% (136.1) (130.1) (6.0) 4.6% (85.5) (80.3) (5.2) 6.5% (26.0) (43.3) 17.3 (40.0%) (28.2) (34.1) 5.9 (17.3%) (38.2) (11.3%) 11.3% 13.5% Operating profit Cost of net debt Other financial income and expenses Income tax expense Tax rate Share of profits / losses of associates Net result from continuing operations Profit of discontinuing operations Net profit Minority interests (52.4) (14.8%) (11.6) (12.3) 0.7 (5.7%) (4.9) 0.6 (5.5) ns (98.7) (115.5) 16.8 (14.5%) 34.7% 33.8% 13.1 (5.5) 18.6 (338.2%) (21.8) (9.9%) ns % (0.2) (1.6) 1.4 (87.5%) Other non-current operating income and expenses (14.2) ns Net profit attributable to the Group % Operating profit (52.4) (14.8%) Consolidated revenue by sector Current operating profit by sector m Change % m Change % Broadcasting France Audiovisual rights International broadcasting Other activities 2, , % TF1 SA 1, , % Theme channels in France % Group Téléshopping % TF1 Entreprises % e-tf % In-house production companies % Others % % TF1 Vidéo (2.6) (1.6%) Catalogue % % 0.0 (5.1) 5.1 ns Broadcasting France Audiovisual rights International broadcasting Other activities (46.0) (15.8%) TF1 SA (38.5) (14.6%) Theme channels in France (13.4) (16.8) 3.4 (20.2%) Group Téléshopping % TF1 Entreprises (0.7) (10.6%) e-tf (2.5) (39.7%) In-house production companies (1.2) 3.3 (4.5) ns Others (3.7) (17.4%) % TF1 Vidéo (1.2) (7,1%) Catalogue % % 0.0 (5.4) 5.4 ns Total revenue 2, , % Current operating profit (38.2) (11.3%)

23 Consolidated balance sheet Consolidated balance sheet ASSETS ( m) 31/12/06 31/12/05 SHAREHOLDERS EQUITY AND LIABILITIES ( m) 31/12/06 31/12/05 Intangible fixed assets Shareholders funds (attributable to the Group) 1, ,051.1 Goodwill Property, plant and equipment Investments in associates Other financial assets Non current tax assets Non current assets 1, Inventories Trade and other debtors 1, ,252.7 Current tax assets Derivative instruments Cash and cash equivalents Current assets 2, ,975.8 Minority interest (0.1) (1.3) Shareholders funds 1, ,049.8 Long term debt Non current provisions Non current tax liabilities Non current liabilities Short term debt Derivative instruments Trade and other creditors 1, ,403.5 Current tax liabilities Current provisions Current liabilities 1, ,476.2 Assets of held-for-sale operations Liabilities of held-for-sale operations Total assets 3, ,470.0 Total equity and liabilities 3, ,470.0 Financial net debt TOTAL GROUP Consolidated cash flow statement Key ratios Cash flow statement summary ( m) Key ratios 31/12/06 31/12/05 31/12/04 Net profit Net cash inflow from operating activities Incl. held-for-sale operations Net cash inflow from investing activities Incl. held-for-sale operations Net cash inflow from financing operations Incl. held-for-sale operations Total change in cash position Incl. held-for-sale operations Operating cash flow after cost of net debt and income taxes Income tax paid (112.0) (156.4) Change in operating working capital needs 42.4 (47.0) (135.4) (114.4) (23.8) (33.8) (159.1) (9.5) (24.7) 0.8 Financial net debt (1) / Shareholders funds (Gearing) Financial net debt (1) / Cost of net debt (1) Cash flow (2) / Financial debt (1) Diluted earnings per share ( ) continuing operations Diluted earnings per share ( ) incl. profit of discontinuing operations Dividend per share ( ) 27.9% * 43.5% % Pay-out ratio (%) (3) 92% 59% 62% (1) Continuing activities + discontinuing operations Cash position at beginning of period Cash position at end of period (2) Continuing activities only in 2006 and 2005 (3) Compared to the diluted earnings (continuing activities) in 2006 and compared to the diluted earnings (incl. profit of discontinuing operations) in 2004 and * Dividend proposed by the Board of Directors to shareholders met in AGM on April 17,

24 Shareholding structure as of December 31, 2006 The TF1 share Others (excl. Europe) Evolution of the TF1 share in 2006: % Europe (excl. France) 17.4% 0.1% Treasury shares (2) Others France (1) 12.5% 27.1% 42.9% janv Jan févr Feb mars Mar Apr avr May mai June juin Jul juil août Aug Sept sept Oct oct Nov nov déc Dec Volume TF1 20 days moving average CAC 40 rebased (1) Incl. non identified holders (2) Shares cancelled on February 20 th, 2007 Source : Euroclear as of 31 December Contacts Jean-Pierre MOREL Deputy General Manager Chief Financial Officer : : : jpmo@tf1.fr IR department : : : comfi@tf1.fr Anne BLAZY Head of Investor Relations Albin de BEAUREGARD : Valérie FRESCHEL Manager : Manager : : ablazy@tf1.fr : : : : adebeauregard@tf1.fr : vfreschel@tf1.fr Pia DOMMERGUE Aurélie GASNOT Assistant Assistant : : : : : pdommergue@tf1.fr : agasnot@tf1.fr 1 quai du Point du Jour Boulogne Cedex France