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Capitulo3-En.Pdf 03 Education, information and entertainment in transformation }}The transformation of PRISA }}Business Areas }}Santillana }}PRISA Noticias }}PRISA Radio }}PRISA TV 03 Education, information and entertainment in transformation In 2010, PRISA embarked on a new phase of development. The Group is committed to a modernization of its traditional business model that will transform it into a consumer-oriented company through the use of the most advanced technology. This process is taking place against the backdrop of the changes that are occurring in the media and content sectors. These rapid changes require the transformation of PRISA into a new company, focused not only on the production and distribution of content in Spanish and Portuguese, but also on building up a greater knowledge base of each of its stakeholders and on the increasing use of new technologies. 03. EDUCATION, INFORMATION, AND ENTERTAINMENT IN TRANSFORMATION ANNUAL REPORT 2011 Operating revenues (in millions of euros) 2009 3.209 2010 2.823 EBIT (in millions of euros) 2009 369 2010 336 EBITDA (in millions of euros) 2009 624 2010 596 In 2010 PRISA implemented much of its financial restructuring plan, with the consolidation of all its The transformation companies with the exception of Cuatro. In fiscal year 2010, the Group reported revenues of EUR 2,822.73 million and EBITDA of 596.33 million. The consolidated of PRISA EBIT was EUR 336.15 million. After dedicating more than 130 million euros to restructuring the balance, the In 2010, PRISA embarked on a new phase of develop- net result was EUR -72.87 million. The Group ended the ment. The Group is committed to a modernization of year having consolidated all its business areas in profit, its traditional business model that will transform it into despite the very adverse economic climate affecting a consumer-oriented company through the use of the the sector. most advanced technology. This process is taking place against the backdrop of the changes that are occurring The divestment plan and the reinforcement of capital in the media and content sectors. These rapid changes structure has seen a capital injection of nearly require the transformation of PRISA into a new company, 2,000 million euros, which has enabled the Group to focused not only on the production and distribution of significantly reduce its debt, which now stands at 4.92 content in Spanish and Portuguese, but also on building times EBITDA. up a greater knowledge base of each of its stakeholders and on the increasing use of new technologies. With 13,885 employees spread between Europe and the Americas, PRISA is configured into four major Since December 3, PRISA shares have been trading in business areas: Publishing, Education, Press, Radio Spain and in the USA, making the group an even more and Audiovisual, all of which are supported in their plural and international company with a new governance digital development by a transversal, cross-corporate model and a majority of independent board members of division. major international importance. This ensures both the 41 03. EDUCATION, INFORMATION, AND ENTERTAINMENT IN TRANSFORMATION ANNUAL REPORT 2011 effective governance and full transparency in all of the Group’s activities required to face this new phase of growth. As part of this transformation, in 2010 we created PRISA Brand Solutions, in order to provide specific solutions for advertising clients and their brands, that will maximize return and provide them with a greater degree of inte- gration into our content. PBS was born from the merger of two of the group’s advertising sales companies: Box Publicidad, responsible for managing advertising in print and online, and GDM, which was responsible for the mar- keting of advertising space on television and radio. The resulting company has almost 300 employees, eight offices and 350 million euros in annual turnover from 60 fully managed communication media. This is a new business model based on the strategy of differentiation, with the capacity to combine many different advertising channels and thus offer advertising solutions tailored to our customers’ needs. Launching of Manuel Rivas’ latest novel Todo es silencio (Everiything is quiet), published by Alfaguara Currently, the company is focused on the transforma- tion of its production model, on developing products based on consumer habits and needs, on the growth of our businesses, on international expansion and Providing a unified strategic and innovative vision the promotion of cross-corporate synergies. This is for the Group’s digital activity. a paradigm shift in the media and content-industry Developing the necessary technological platforms worldwide, caused chiefly by the impact of new to manage digital content. technologies. This process directly affects PRISA, Developing and exploiting new digital products. which has embarked upon a complete transformation of the entire organization in order to adapt to the January 2010 saw the appointment of two senior new digital world. executives at PRISA, Kamal M. Bherwani as Chief Digital Officer, and Andres Cardó, as director of Cor- In this regard, in 2010 the Group has advanced con- porate Development and Marketing, which marked siderably along the path started in 2008 and 2009, the start of a new business strategy for the Group, whereby the former Prisacom, which had been in charge and a paradigm shift in its development. Bherwani is of the Group’s digital operations, has gradually been a senior executive with renowned worldwide experi- ceding management of digital business to each of the ence, whose vision and strategy have transformed respective offline brands to instead focus on its role in organizations and inspired teams in both the public the areas of support and R & D. Since 2009, the edi- and private sector. tions of elpais.com, as.com, cincodias.com, cuatro.com, los40.com, etc., have all been fully integrated into their As Chief Digital Officer (CDO) of PRISA, Bherwani is corresponding traditional media to better facilitate responsible for digital strategy and innovation, includ- coordination and synergies between them, and thus ing PRISA’s digital strategy in the area of ​​sales, digital enable the provision of integrated products that meet distribution, content management systems (CMS), in- new customer demands. Thus, from each of the brands ternal technology and all technological alliances. and business units, we develop content for all devices on the market, with the technical and strategic support Andres Cardó will drive expansion of the business units of the digital area, whose current mission is aimed at: with an emphasis on the U.S. and Brazilian markets, and 42 03. EDUCATION, INFORMATION, AND ENTERTAINMENT IN TRANSFORMATION ANNUAL REPORT 2011 will be responsible for international organic growth and diversification into new businesses and cross-corporate projects. In the areas of Sales and Marketing, he will be responsible for the policies and business strategies of the business units, which include advertising, promo- tions and brand extension. Bherwani and Cardó, in their respective fields, are set to transform the business model of PRISA, and will ensure that the group’s businesses development within an advanced technological environment and that they are personalized to the individual needs of the millions of consumers of the Group’s products. From a product standpoint, the last quarter of 2009 saw the development of the Infometeo.es news channel, a new website produced by the weather channel at Digi- tal+, which channels its information into the Group’s other media. It is now the benchmark for Spanish-lan- guage weather information. Moreover, we have developed an adaptation of the microsites tool plus.es that allows journalists to crea- te websites and programs without involving technical teams. 43 03. EDUCATION, INFORMATION, AND ENTERTAINMENT IN TRANSFORMATION ANNUAL REPORT 2011 million (+9.4%). This excellent result was in part thanks Santillana to the strong growth experienced in Latin America, which saw a 12% increase in revenue and 15.7% in EBITDA. Quality and innovation at the Among those countries seeing significant growth were service of education and culture Brazil (+38.9%), Mexico (+20%), Chile (+17.3%) and Ar- gentina (+7.1%). The quality of our publications and Santillana celebrated its 50th anniversary in 2010. our attention to the needs of teachers, students and Founded in 1960 with the aim of providing a success- general readers have strengthened our national and in- ful and innovative model for educational publishing, ternational leadership. Santillana is today a global publishing group in Spa- nish and Portuguese. The group is present in almost all Moderna, our educational publishing house in Brazil Spanish-speaking countries, where it is leader in educa- since 2001, posted outstanding results, with net sales tion. Santillana is also a significant player in other lines of 181 million euros, 37% more than in 2009. EBITDA of business such as general-interest publishing, as well reached 47 million euros (+50.7%). Moderna strengthe- as in Portugal, United Kingdom, Brazil and the United ned its lead in the private market, with an increase in States. Over 2010 Santillana added 6,000 new titles sales of 42% compared to 2009. It now has a market to its catalog of 31,000 titles. share of 18% of business aimed at the state school sector, selling 27 million titles. Over the past fifty years, Santillana has built a cultural bridge between Spain and Latin America and has been ins- For the language-teaching sector, it has been a good trumental in improving education. Santillana is committed year, with revenues up by of 9.7% and EBIT up 17% to education and for three decades has sponsored school compared to 2009. Richmond has improved its posi- innovation awards and the annual events Spring Seminar tion in the market for English-language education, con- and Monographic Education Week. solidating its international image.
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