2020 Annual Report
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C127090 FINANCIAL HIGHLIGHTS 2020 Revenue from External Customers by 2020 2019 Change Operating Segment % relating to 2019 are shown in brackets Performance Loss per share HK$(0.64 ) HK$(0.67 ) -5% Hong Kong TV broadcasting 49% (60%) Dividends per share - Interim - HK$0.30 Programme - Final - HK$0.20 licensing and - HK$0.50 distribution 26% (20%) HK$’mil HK$’mil Other activities Revenue from external customers 1% (1%) - Hong Kong TV broadcasting 1,323 2,190 -40% - myTV SUPER 412 442 -7% Overseas pay TV myTV SUPER Big Big Channel - Big Big Channel and and TVB Anywhere 15% (12%) and e-Commerce e-Commerce business 107 129 -16% 5% (3%) business - Programme licensing and 4% (4%) distribution 718 740 -3% - Overseas pay TV and TVB Anywhere 159 144 11% - Other activities 5 4 NM 2020 Revenue by Geographical Locations 2,724 3,649 -25% % relating to 2019 are shown in brackets Hong Kong Segment profit/(loss)* 56% (72%) - Hong Kong TV broadcasting (593 ) (304 ) 95% - myTV SUPER 11 40 -71% - Big Big Channel and e-Commerce business 53 44 20% Mainland China - Programme licensing and 29% (15%) distribution 346 412 -16% - Overseas pay TV and Malaysia and TVB Anywhere 8 (10 ) N/A Singapore - Other activities (3 ) (4 ) NM 7% (7%) - Corporate support§ (173 ) (152 ) 14% USA and Other (351 ) 26 N/A Canada territories 4% (3%) 4% (3%) Total expensesΔ 3,253 3,698 -12% Loss attributable to equity holders (281 ) (295 ) -5% Earnings and Dividends§ Per Share Earnings per Share 31 December 31 December Dividends§ per Share 2020 2019 HK$’mil HK$’mil 1.5 Total assets 9,832 8,595 14% Total liabilities 4,534 3,006 51% 1 Total equity 5,298 5,589 -5% Number of issued shares 438,000,000 438,000,000 0.5 $ K H Ratios 0 Current ratio 2.5 4.2 Gearing 8.6% 19.6% -0.5 -1 * 2016 2017 2018 2019 2020 excluding non-recurring items § YEAR comprised mainly of interest costs of TVB Notes § excluding special dividend Δ represented the total of cost of sales, selling, distribution and transmission costs and general and administrative expenses BROADCASTING AND PRODUCTION 21,712 hours 26.5 TVRs 3.9m Total production output All TVB channels’ prime time rating In-home-viewers in Hong Kong of (2019: 22,160 hours) (2019: 23.5 TVRs) TVB News Channel every week (2019: 3.9m) 5.4m 86% 88% In-home-viewers in Hong Kong of audience share in young audience audience share among high income all TVB channels every week group (below age of 35) group viewership (2019: 5.5m) DIGITAL STREAMING 9.16m 20.79m hours 18.8 hours myTV SUPER’s registered users Average weekly time spent Average weekly time spent per (2019: 8.16m) (2019: 20.23m hours) unique stream viewer (2019: 16.4 hours) 1.3m 3.39 TVRs 1.89 TVRs myTV SUPER’s paying subscribers Prime time ratings of myTV SUPER All-day-all-time ratings (2019: 1.19m) (2019: 3.26 TVRs) (2019: 1.84 TVRs) SOCIAL MEDIA AND E-COMMERCE 12.8m 27.6m HK$142m TVB followers from Average weekly stream view from Big Big Shop's social media platforms social media platforms Gross merchandise value (2019: 11.3m) (2019: 15.3m) (2019: HK$32m) ENVIRONMENTAL 6.39% ↓ 2.85% ↓ 4.35% ↓ Total greenhouse gas emissions Energy intensity per Electricity consumption production hour Television Broadcasts Limited Annual Report 2020 1 TVB is one of the largest commercial Chinese programme producers in the world with an annual production output of over 21,000 hours of dramas and variety programmes, in addition to documentaries and news reports, and an archive library of over 152,000 hours accumulated over 53 years of operation. Its vertically integrated business model extends from content creation, broadcasting to distribution. 2 Television Broadcasts Limited Annual Report 2020 With its strong production capability and audience influence, TVB now operates a traditional media platform as well as over-the-top services myTV SUPER and TVB Anywhere, social media platform Big Big Channel and e-commerce platform Big Big Shop. Television Broadcasts Limited Annual Report 2020 3 Vision Our vision is to grow TVB into a world-class media organisation with extensive digital and direct-to-customer capabilities, amplifying our long tradition to entertain, inform and enrich audiences 4 Television Broadcasts Limited Annual Report 2020 CONTENTS Overview 8 Corporate Information Overview 10 Milestones p.26 12 Viewership Highlights 14 Commendations and Awards Hong Kong TV Broadcasting 16 Message from the Chairman 20 Group CEO Report Management Discussion and Analysis Management Discussion and Management Discussion and Analysis 26 Hong Kong TV Broadcasting 42 myTV SUPER 46 Big Big Channel and e-Commerce 50 Mainland China Operations p.42 54 Programme Licensing and Distribution myTV SUPER 56 Overseas Pay TV and TVB Anywhere 64 Financial Review Governance Governance 74 Directors and Senior Management 81 Directors’ Report 96 Corporate Governance Report Financials p.46 120 Five-Year Financial Review 121 Independent Auditor’s Report Big Big Channel and e-Commerce 126 Audited Financial Statements Financials Television Broadcasts Limited Annual Report 2020 5 Overview 6 Television Broadcasts Limited Annual Report 2020 Overview Management Discussion and Analysis Governance Financials 7 Television Broadcasts Limited Annual Report 2020 CORPORATE INFORMATION CHAIRMAN EMERITUS NOMINATION COMMITTEE The late Sir Run Run SHAW GBM Thomas HUI To Chairman Anthony LEE Hsien Pin BOARD OF DIRECTORS Dr. Allan ZEMAN Felix FONG Wo CHAIRMAN Belinda WONG Ching Ying Thomas HUI To RISK COMMITTEE VICE CHAIRMAN AND Felix FONG Wo Chairman EXECUTIVE DIRECTOR Mark LEE Po On Mark LEE Po On JP Kenneth HSU Kin Dr. William LO Wing Yan NON-EXECUTIVE DIRECTORS Thomas HUI To INVESTMENT COMMITTEE LI Ruigang Anthony LEE Hsien Pin Chairman Anthony LEE Hsien Pin Thomas HUI To CHEN Wen Chi Mark LEE Po On Kenneth HSU Kin Adrian MAK Yau Kee Chief Financial Officer and Company Secretary INDEPENDENT NON-EXECUTIVE DIRECTORS Dr. William LO Wing Yan JP REGULATORY COMMITTEE Professor Caroline WANG Chia-Ling Felix FONG Wo Chairman Dr. Allan ZEMAN GBM, GBS, JP Mark LEE Po On Felix FONG Wo BBS, JP Dr. William LO Wing Yan Belinda WONG Ching Ying Desmond CHAN Shu Hung Deputy General Manager (Legal and International Operations) BOARD COMMITTEES SENIOR MANAGEMENT EXECUTIVE COMMITTEE Mark LEE Po On Group Chief Executive Officer Mark LEE Po On Chairman Desmond CHAN Shu Hung Deputy General Manager Thomas HUI To (Legal and International Operations) LI Ruigang Felix TO Chi Hak Deputy General Manager (Drama Production & Programme) AUDIT COMMITTEE Eric TSANG Chi Wai Deputy General Manager Dr. William LO Wing Yan Chairman (Non-drama, Music Production & Programme) Anthony LEE Hsien Pin Adrian MAK Yau Kee Chief Financial Officer and Felix FONG Wo Company Secretary Belinda WONG Ching Ying COMPANY SECRETARY REMUNERATION COMMITTEE Adrian MAK Yau Kee Belinda WONG Ching Ying Chairman Email: [email protected] LI Ruigang Fax: +852 2358 1337 Felix FONG Wo 8 Television Broadcasts Limited Annual Report 2020 REGISTERED OFFICE AMERICAN DEPOSITARY RECEIPTS Overview TVB City, 77 Chun Choi Street BNY Mellon Shareowner Services Tseung Kwan O Industrial Estate P.O. Box 30170 Kowloon, Hong Kong College Station TX 77842-3170 AUDITOR USA PricewaterhouseCoopers Certified Public Accountants INVESTOR RELATIONS Analysis Management Discussion and Registered Public Interest Entity Auditor Email: [email protected] Fax: +852 2358 1337 LEGAL ADVISERS Freshfields Bruckhaus Deringer WEBSITE http://corporate.tvb.com Stephenson Harwood CORPORATE CALENDAR PRINCIPAL BANKERS Shanghai Commercial Bank Limited FOR TELEVISION BROADCASTS LIMITED Bank of Communications Co., Ltd. Hong Kong Branch SHAREHOLDERS Standard Chartered Bank (Hong Kong) Limited BOOK CLOSE PERIOD The Hongkong and Shanghai Banking 28 April 2021 to 26 May 2021, Corporation Limited both dates inclusive Chong Hing Bank Limited UBS AG ANNUAL GENERAL MEETING 26 May 2021 Governance SHARE REGISTRAR AND TRANSFER OFFICE FOR HOLDERS OF US$500,000,000 Computershare Hong Kong Investor Services Limited AGGREGATE PRINCIPAL AMOUNT OF 3.625 Shops 1712-1716, 17th Floor PERCENT GUARANTEED NOTES DUE 2021 Hopewell Centre ISSUED BY TVB FINANCE LIMITED 183 Queen’s Road East INTEREST PAYMENT FOR 2021 Wan Chai, Hong Kong First interest payment: 11 April 2021 Second interest payment: 11 October 2021 STOCK CODES TVB Ordinary Shares MATURITY DATE 11 October 2021 The Stock Exchange of Hong Kong: 00511 Reuters: 0511.HK Bloomberg: 511 HK Financials TVB ADR Level 1 Programme: TVBCY TVB Finance Guaranteed Notes The Stock Exchange of Hong Kong: 04577 ISIN: XS1495978329 Common Code: 149597832 Television Broadcasts Limited Annual Report 2020 9 MILESTONES Sir Run Run Shaw, G.B.M., one of the 1980 founders of the Group, became 1967 1973 1976 Chairman of the Board of Directors 1971 1984 Began programme licensing, video rental business and HK-TVB was listed on HKSE Obtained a Broadcasting Licence in operation of cable and September and commenced free-to-air satellite television channels in broadcasting on 19 November as the overseas markets rst wireless commercial television in Organised the rst Miss Hong Kong Pageant Hong Kong. Headquartered on which has since become an iconic annual event Broadcast Drive, Kowloon Launched the rst colour production Adopted a programming strategy of Enjoy Yourself Tonight (EYT) broadcasting 2.5 hours of drama 1981 serials on Jade during weekday prime time to build viewership momentum 1988 2003 2007 Obtained approval from Broadcasting Authority to establish a regional satellite 1994 television broadcast service for 2004 Began digital terrestrial audiences across Asia television broadcasting in Hong Kong from 31 1993 December and expanded the number of channels from two Launched the Company’s Granted Guangdong Landing (Jade and Pearl) to the rst website tvb.com Rights for distribution of Jade present ve channels carrying information on and Pearl channels in the 1997 the station’s programmes Guangdong Province and artistes Moved headquarters to TVB City in Tseung Television Broadcasts (TVB) became the listed Kwan O Industrial Estate with a total parent company of the Group after a group Launched TVBS Channel building area of 110,000 square metres reorganisation.