Creating Long-Term Growth PROSIEBENSAT.1 at a GLANCE
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Annual Report 2013 Creating Long-Term Growth PROSIEBENSAT.1 AT A GLANCE The ProSiebenSat.1 Group was established in 2000. Today, we are one of the leading and most profitable media corporations in Europe, reaching around 42 million TV households with our TV stations in Germany, Austria and Switzerland. Free TV financed by advertising is our core business. Alongside a strong digital and ventures portfolio, the Group also owns an international production network. This means ProSiebenSat.1 has a broad revenue and earnings basis. In the 2013 financial year, we generated revenues of EUR 2.605 billion from continuing operations and recurring EBITDA of EUR 790.3 million. Our headquarters are located in Unter föhring near Munich. ProSiebenSat.1 Media AG is listed in Germany and Luxembourg and employs around 3,500 staff across the Group. GROUP REVENUES RECURRING EBITDA FROM CONTINUING OPERATIONS (I) FROM CONTINUING OPERATIONS (II) EUR m EUR m 2013 2,605.3 2013 790.3 2012 2,356.2 2012 744.8 REVENUES BY SEGMENT REVENUES BY REGION FROM CONTINUING OPERATIONS (III) FROM CONTINUING OPERATIONS (IV) In percent, 2012 figures in parantheses In percent, 2012 figures in parantheses Others 1.3 (1.8) Digital & Adjacent Germany USA Broadcasting 18.6 (14.2) 87.2 (87.7) German-speaking 2.3 (1.2) UK 76.7 (81.7) Content Production & Austria/Switzerland Global Sales 1.1 (1.1) 4.8 (4.1) 8.0 (8.2) TARGETS 2013 ACTUAL FIGURES 2013 FORECASTS 1 2014/2015 Revenues Revenues Revenues Growth by a high +10.6 % Growth Growth by a mid to high single-digit percentage to EUR 2,605.3 million single-digit percentage (2012: EUR 2,356.2 million) Broadcasting German-speaking Broadcasting Broadcasting Slight increase by a low +3.7 % German-speaking German-speaking single-digit percentage Increase Slight increase (2012: EUR 1,926.0 million) to EUR 1,997.8 million Digital & Adjacent Digital & Adjacent Digital & Adjacent Significant increase +44.5 % Increase Significant increase (2012: EUR 334.8 million) to EUR 483.7 million Content Production & Content Production & Content Production & Global Sales +29.7 % Global Sales Global Sales Significant increase Increase Significant increase (2012: EUR 95.4 million) to EUR 123.8 million Recurring EBITDA Recurring EBITDA Recurring EBITDA Increase +6.1 % Increase Mid single-digit increase (2012: EUR 744.8 million) to EUR 790.3 million Broadcasting Broadcasting Broadcasting German-speaking +2.0 % German-speaking German-speaking Stable development Increase Slight increase (2012: EUR 665.1 million) to EUR 678.6 million Digital & Adjacent Digital & Adjacent Digital & Adjacent Significant increase +24.2 % Increase Significant increase (2012: EUR 84.9 million) to EUR 105.4 million Content Production & Content Production & Content Production & Global Sales >+100 % Global Sales Global Sales Significant increase Increase Significant increase (2012: EUR 4.3 million) to EUR 10.6 million Underlying net income Underlying Underlying net income Increase +6.8 % net income High single-digit increase (2012: EUR 355.5 million) Increase to EUR 379.7 million Leverage factor 3 Leverage factor Leverage factor 1.5 – 2.5 1.8 1.5 – 2.5 (2012: 2.0)2 German German German TV audience market TV audience market TV audience market — 28.1 % Market leadership 4 At least maintain or slightly improve leading position 1 Percentage change vs. previous year; continuing 3 After reclassification of cash and cash equivalents 4 Relevant target group of 14 to 49 year olds. operations. from the Eastern European business. Adjusted for 2 Before reclassification of cash and cash LTM recurring EBITDA from the Northern and equivalents from the Northern and Eastern Eastern European business. European business. SELECTED KEY FIGURES OF THE PROSIEBENSAT.1 GROUP FOR THE 2013 FINANCIAL YEAR (V) ProSiebenSat.1 including Discontinued ProSiebenSat.1 discontinued operations operations continuing operations EUR m 2013 2012 2013 2012 2013 2012 Revenues 2,818.1 2,969.1 212.8 612.9 2,605.3 2,356.2 Operating costs1 2,142.5 2,111.0 306.6 486.4 1,835.8 1,624.6 Total costs 2,311.2 2,389.3 349.3 620.5 1,961.9 1,768.8 Cost of sales 1,680.0 1,607.3 248.2 340.9 1,431.8 1,266.4 Selling expenses 289.3 354.3 45.7 124.4 243.5 229.9 Administrative expenses 331.9 316.0 46.2 72.1 285.7 243.9 Other operating expenses 10.0 111.7 9.2 83.1 0.8 28.6 EBIT 610.0 593.7 -58.9 -7.2 668.9 600.9 Recurring EBITDA2 696.8 871.7 -93.5 126.9 790.3 744.8 Non-recurring items3 37.2 -78.3 69.8 -13.9 -32.6 -64.4 EBITDA 734.1 793.4 -23.7 113.0 757.8 680.4 Consolidated net profit attributable to shareholders of ProSiebenSat.1 Media AG 312.1 295.0 -47.3 -29.7 359.5 324.7 Underlying net income4 340.1 415.1 -39.6 59.6 379.7 355.5 EUR m 2013 2012 Broadcasting German-speaking 5 External revenues 1,997.8 1,926.0 Recurring EBITDA2 678.6 665.1 Recurring EBITDA margin (in percent) 6 32.7 33.3 EBITDA 649.9 613.2 Digital & Adjacent 5 External revenues 483.7 334.8 Recurring EBITDA2 105.4 84.9 Recurring EBITDA margin (in percent) 6 21.6 25.3 EBITDA 100.9 76.6 Content Production & Global Sales 5 External revenues 123.8 95.4 Recurring EBITDA2 10.6 4.3 Recurring EBITDA margin (in percent) 6 6.3 3.1 EBITDA 11.5 1.5 1 Total costs excluding depreciation/amortization and non-recurring expenses. 4 Consolidated profit for the period after non-controlling interests from continuing 2 EBITDA before non-recurring (exceptional) items. operations, before the effects of purchase price allocations and other special 3 Non-recurring expenses netted against non-recurring income. items as well as expenses incurred for the antitrust proceedings in 2012. 5 The figures relate to continuing operations. 6 Based on total segment revenues, see Note 35 “Segment reporting”. Explanation of reporting principles in the fourth quarter or the 2013 financial year. cash flow statement, the figures for the previous year are presented on a comparable The figures for the fourth quarter of 2013 and the year as a whole relate to the key basis. The income statement items of the entities concerned are grouped as a single figures from continuing operations in line with IFRS 5, i.e. not including the revenue line item, ‘result from discontinued operations’, and reported separately. The result and earnings contributions of the disposed Northern European activities which were from discontinued operations includes both the net profit generated by the compa- deconsolidated on April 9, 2013, and the Eastern European activities classified as nies sold or held for sale and the gain on disposal of the Northern European subsi- held-for-sale until the closing of the sale transaction. For the income statement and diaries and is presented after taxes. Reporting for the fourth quarter and full year 2013 is based on the new segment previous year, the figures for the previous year were adjusted to the new segment structure. To ensure comparability of the current quarterly figures with those of the structure. Due to rounding, it is possible that single figures in these Group financial statements do reflect the absolute figures they relate to. Change rates are based on a business not exactly add to the totals shown and that the percentage figures given do not exactly perspective. Improvements are shown with a plus (+), deterioration with a minus (–). KEY FIGURES A GLANCE AT SELECTED 2 CREATING LONG-TERM GROWTH 38 BROADCASTING GERMAN-SPEAKING CREATING LONG-TERM GROWTH 160 DIGITAL & ADJACENT 284 CONTENT PRODUCTION & GLOBAL SALES REPORTS FROM More than any other medium, televisionTHE EXECUTIVE has AND the capability of attracting emotions.SUPERVISORY This BOARD is 14 Interview with CEO Thomas Ebeling also true in a global, digitalized 18 market. Members of the Executive Here Board 20 Report of the Supervisory Board 27 Proposed Allocation of Profits too, television is the basis for our 27 Manage success.ment Declaration and Corporate Governance Report We are moving vigorously into new business GROUP MANAGEMENT areas, thus creating a strong foundationREPORT TO GROW STEADILY AND PROFITABILY 40 The Year: 2013In At oura Glance 42 Basic Principles of the Group 64 TV Highlights 2013 core business of TV, digital activities 66 Report on Economic and Position with 95 Segment Reporting our international program production 98 Employees and 105 The ProSiebenSat.1 Share sales network. 110 Other Non-Financial Performance Indicators 122 Public Value 124 Events after the Reporting Period 125 Risk Report All the areas are interlinked. It 142is Outlook in this way that we realize our vision of a BROADCASTING156 Takeover-Related Disclosures , DIGITAL ENTERTAINMENT AND CONSOLIDATED COMMERCE POWERHOUSE. FINANCIAL STATEMENTS 162 Income Statement 163 Statement of Comprehensive Income 164 Statement of Financial Position ProSiebenSat.1 166 Cash Flow Statement 168 Statement of Changes in Equity THE POWER OF TELEVISION 169 Notes 281 Responsibility Statement 282 Auditor’s Report ADDITIONAL INFORMATION 286 Group Key Figures: Multi-Year Overview 287 Segment Key Figures: Multi-Year Overview 288 Finance Glossary 290 Media Glossary 292 Index of Figures and Tables 295 Editorial Information 296 Financial Calendar CREATING LONG-TERM GROWTH The basis for our success is television. Because more than any other medium, television has the capability of attracting emotions. This is also true in a global, digitalized market. We are moving vigorously into new business areas, thus creating a strong foundation TO GROW STEADILY AND PROFITABILY: In our core business of TV, digital activities and our international program production and sales network.