2015 Annual Review Breakdown of Staff by Department Split of 2015 Revenue Split of 2015 Revenue (%) (As of 31 December 2015) (%) by Region (%)
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2015 ANNUAL REVIEW BREAKDOWN OF STAFF BY DEPARTMENT SPLIT OF 2015 REVENUE SPLIT OF 2015 REVENUE (%) (AS OF 31 DECEMBER 2015) (%) BY REGION (%) 12.1 1.6 1.6 SALES & BIG EVENT RENTALS BIG EVENT RENTALS MARKETING 25.1 21.6 PRODUCTION & APAC 53.8 OPERATIONS OUTSIDE BROADCAST 13.8 34.7 VANS CORPORATE NALA SERVICES 44.6 STUDIOS & 49.0 42.0 OTHERS R&D EMEA REVENUE NET PROFIT GROSS DIVIDEND (EUR MILLIONS) (EUR MILLIONS) PER SHARE (EUR) 150 50 3.0 120 40 2.5 2.0 90 30 1.5 60 20 1.0 30 10 0.5 0 0 0 06 07 08 09 10 11 12 13 14 15 06 07 08 09 10 11 12 13 14 15 06 07 08 09 10 11 12 13 14 15 EUR 118.5 27.6% 3.5% MILLION SALES IN 2015 EBIT MARGIN IN 2015 DIVIDEND YIELD IN 2015 1 - WWW.EVS.COM WHO ARE WE? EVS is a company headquartered in Belgium, with 20 offices in Europe, the Middle East, Asia and North America. Its 485 employees sell its branded products in over 100 countries, and provide customer support globally. Founded in 1994, its innovative Live Slow Motion system revolutionized CONTENT live broadcasting. Its reliable and integrated tapeless solutions, based 01 around its market-leading XT server PROFILE range, are now widely used to deliver 02 live productions worldwide. MESSAGE TO THE SHAREHOLDERS 04 2015 HIGHLIGHTS 06 WHAT DO WE DO? OUR STRATEGIC PRIORITIES 10 EVS is the industry leader in OUR KEY PRODUCTS premium technologies that enrich 12 and manage live video assets, OUR CORPORATE SOCIAL RESPONSIBILITY enabling its customers to engage 14 audiences and monetize their content SHAREHOLDERS’ INFORMATION across multiple platforms. The 18 industry-leading broadcast and OUR PRESENCE IN THE WORLD media production systems of EVS are used by broadcasters, production companies, post-production facilities, film studios, content owners and archive libraries around the globe, to support primarily the production of their sport, entertainment and news programs. EVS ANNUAL REVIEW 2015 - 2 2015, SHAPING EVS FOR THE FUTURE INTERVIEW WITH THE PIERRE RION, CHAIRMAN AND THE CHAIRMAN OF THE BOARD OF DIRECTORS MANAGING DIRECTOR MURIELLE DE LATHOUWER, MANAGING DIRECTOR & CEO “EVS ENDED THE YEAR ON A HIGH NOTE, WITH AN EXCEPTIONAL FOURTH QUARTER. THE CHAIRMAN AND THE CEO REFLECT ON HOW CAN WE CHARACTERIZE THIS YEAR 2015? THE YEAR, NOT ONLY ON THE FINANCIAL MURIEL DE LATHOUWER — As you know, our business is positively SIDE, BUT ALSO ON THE EVOLUTION OF impacted every even year by rentals for major global sporting EVS FOR THE LONG TERM.” events. Apart from this, EVS revenue was stable in 2015 compared to 2014 and better than anticipated, with a strong end of the year. After a period of high cautiousness in the first half of 2015 due to the industry transition, we witnessed some of our customers releasing budgets at the end of 2015. Despite these challenging conditions, EVS remains the market leader with high customer confidence, evidenced by the multi-year contract with NEP signed in early 2016. 3 - WWW.EVS.COM “I’M HAPPY TO SEE THIS CONTINUOUS POSITIVE MOMENTUM AT EVS.” Aside from our financial performance, we have done a lot AND WHAT ABOUT THE LONG TERM? WHAT ARE THE GROWTH to position the company for the future. We implemented DRIVERS FOR EVS? a stronger focus on cost management and set up a more MURIEL DE LATHOUWER — We will remain very active in terms of efficient organization, with strong buy-in from employees. innovation and very demanding in terms of quality to maintain Simultaneously, we initiated a deep strategic review, which our leading position, providing premium technologies to enrich supports a better-defined vision for our long term future. and manage live video assets, and enable our customers to engage audiences and monetize their content across multiple PIERRE RION — In 2015, the Board of Directors was also reinforced platforms. The established long term growth drivers remain by the appointment of new members: Patrick Tillieux (board in place and include HD, 4K, multi-platform distribution or, member) and Martin De Prycker (board observer), who bring us live sports. In addition, new video consumption habits, with even more industry and technology expertise in a period of rapid increased interaction with smartphones and tablets, open up change for the broadcast industry. new opportunities for our company. Traditional customers and In May, the Board will propose to the Ordinary General Meeting new players, such as sport teams and federations, are looking at to distribute a total gross dividend of EUR 1.00 per share innovative ways to further engage fans and keep them connected (including the interim dividend of EUR 0.50 distributed in longer – at home or in the stadiums. November 2015). This represents a 3.5% payout ratio and a PIERRE RION — I’m happy to see continuous, positive momentum dividend yield of 56.8%. This decision takes into account our at EVS. The setup of a more efficient organization has allowed willingness to keep some financial flexibility to finance the future us to speed development processes and better prepare development of our company. the company for the future. There are challenges, but also WHAT CAN WE EXPECT FROM 2016, ANOTHER YEAR OF BIG opportunities, and we have the necessary strenghts to address SPORTING EVENTS? them. Thank you to our teams, our customers, our suppliers and MURIEL DE LATHOUWER — In 2016, we expect the industry to remain our shareholders for their confidence. Together, we will continue in mutation and technology transitions to continue to weight on to write the future of EVS. investment decisions. Big sporting events, including the EURO football championship and the summer Olympics should bring additional rental revenue projected at around EUR 10 million. Given these circumstances, we will keep a strong focus on cost management, while investing in the future to strengthen our leadership position and develop growth opportunities. FIND OUT MORE ONLINE WWW.EVS.COM EVS ANNUAL REVIEW 2015 - 4 2015 HIGHLIGHTS THE HIGHLIGHTS TELL OUR STORY – ONE THAT STARTS WITH A VISION CARRIED THROUGH OUR SOLUTIONS, PEOPLE AND SERVICE. THANKS FOR MAKING OUR YEAR SO NOTABLE. BEGINNINGS 2015 saw the move of EVS in its state-of- the-art new headquarters in Liege. All teams, previously in 6 different buildings, are now gathered in one unique facility that includes all steps of EVS products life, from the R&D to the assembling and the support. This new headquarters has been designed to sustain the future growth of EVS and the evolution of technology. FAN ENGAGEMENT Fans are more and more connected and engaged with live sports, viewing and interacting with content on screens of all shapes and sizes. From the South East Asian Games to the FA * Cup Final in the UK, EVS demonstrated 72% its innovation power by bringing additional content repurposed for the OF FANS USE connected fans, at home or directly in MOBILE DEVICES the stadiums. INSIDE THE STADIUM * SOURCE: EVS FAN SURVEY, 2015 INNOVATION EVS focuses on practical innovation, and unbridled commitment to market needs EMOTION drives all EVS developments. It results in technology that, in the hands of customers, A year of big moments in live produces innovations that even they couldn’t events, broadcast around the have imagined. From the EVS’ IP4Live initiative world with remarkable clarity to IT-based switching (DYVI) to the magic of and realism. With its 90+% operators who work with the EVS solutions, market share in high end mobile it inspires the company – every day. IP4Live production vans, EVS brings the is EVS’ strategic approach supporting emotion to millions of viewers and leading the transition to IP/IT-based for live shows, sport games infrastructures for live production, in a way and sporting events. Every day, that is smart, strategic and cost effective. worldwide. The program consists of new solutions, thought leadership on strategic directions for successful transition to IP-based production, and proven reference designs for IP/IT-based production infrastructures. 5 - WWW.EVS.COM INSIDE EVS Following the appointment of Muriel De Lathouwer as Managing Director & CEO of EVS in February 2015, the company has further improved its internal organization to better match the fast evolving business needs. In 2015, given the uncertain industry environment, a particular focus has been put on strict cost management, which resulted in flat operating expenses in 2015 compared to 2014. RECOGNITION EVS was proud to score big this year with wins that included the TVB Award for live production infrastructure featuring C-Cast, NewBay Media’s NAB Best of Show Award for FanCast, New Bay Media’s 2015 Product Innovation Award for DYVI and the IABM Design and Innovation Award for multimedia production at the SEA Games. 76% OF FANS FOLLOW CUSTOMERS SPORTS ONLINE Key long term customers have reiterated their confidence in EVS solutions, with upgrades to the XT3 platform supporting the business. As an example, early 2016, NEP group signed a record multi-year agreement with EVS covering a large number of EVS server upgrades. New customers also elected EVS for their projects, such as MediaCorp, who selected a full end-to-end news production solution from EVS for their new facilities in Mediapolis, Singapore. EVS ANNUAL REVIEW 2015 - 6 OUR STRATEGIC PRIORITIES EVS CORE MISSION IS TO PROVIDE PREMIUM TECHNOLOGIES TO ENRICH AND MANAGE LIVE VIDEO ASSETS, ENABLING ITS CUSTOMERS TO ENGAGE AUDIENCES AND MONETIZE THEIR CONTENT ACROSS MULTIPLE PLATFORMS. TO ACHIEVE THIS, EVS HAS DEVELOPED A GO-TO-MARKET STRATEGY WITH DIFFERENT APPROACHES. GO-TO-MARKET STRATEGY MULTIPLE MULTIPLE MOBILE PRODUCTION TRUCKS PLATFORMS CUSTOMERS MULTIPLE BROADCASTERS POST-PRODUCTION CONTENT HOUSES TYPES SPORTS NEWS ENTERTAINMENT STADIUM SPORTS FEDERATIONS 7 - WWW.EVS.COM THE ALLIANCE FOR IP MEDIA SOLUTIONS (AIMS) IS A NON-PROFIT TRADE ORGANIZATION FOUNDED BY LEADING COMPANIES TO FOSTER THE ADOPTION OF INDUSTRY STANDARDS FOR THE BROADCAST AND MEDIA INDUSTRY AS IT TRANSITIONS FROM SDI TO IP.