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Preliminary Results 2008 - UTV Media plc

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					UTV Media plc

   Preliminary Results 2008
AGENDA


         The UTV Media Group


                                           John McCann
         Financial Overview                Group Chief Executive




         Radio                             Jim Downey
                                           Group Commercial
                                           Director


         Television
                                           Scott Taunton
                                           Managing Director
                                           UTV Radio (GB)
         New Media


                                           Norman McKeown
         Conclusion                        Group Finance Director




UTV Media plc | Preliminary Results 2008             No | 1
THE UTV MEDIA GROUP

                                           UTV Radio (GB) operates the national speech station, talkSPORT, 15 ILR
                                           stations and a number of DAB multiplexes throughout Britain



                                           50% shareholder of First Radio Sales, representing national airtime
                                           sales for 133 local radio stations throughout the UK


                                           The largest operators of independent local radio in Ireland with
                                           stations in Dublin (2), Belfast, Cork, Limerick, Dundalk and Drogheda


                                           ITV franchise holder for Northern Ireland

                                           Receivable in 80% of homes in Republic of Ireland


                                           UTV New Media is a leading Internet Service Provider and web
                                           development company




UTV Media plc | Preliminary Results 2008                                                                    No | 2
THE UTV MEDIA GROUP


   42%9%                The changing nature of the UTV Media Group



                                                                         32%
                              2%                     9%                               9%
                                           74%
                98%
                                                   17%                     59%




                                                                            27%
                 100%                      82%        4%                              7%

                                                    14%
                                                                            66%




                                                                 Note – Continuing Operations only

UTV Media plc | Preliminary Results 2008                                                       No | 3
FINANCIAL OVERVIEW

   UTV Media plc Preliminary Results 2008




                                            No | 4
FINANCIAL OVERVIEW | 2008 Preliminary Results




  Group revenue from continuing operations up by 6% to
  £120.3m (2007: £113.8m)                                                                           26.8      28.1     28.1

                                                                                            25.1
  Group operating profit from continuing operations (pre-
  exceptional charges) remains constant at £28.1m (2007:
  £28.1m)                                                                         18.4


  Operating loss from discontinued operations £1.5m
  (2007:£2.0m)

  UTV Radio GB operating profit down by 9% to £10.4m (2007:
  £11.4m) after start up losses at Central FM of £0.3m and of       Note - Prior years have been adjusted for discontinuing operations

  £0.5m at talkSPORT Magazine                                     Group Operating Profit
                                                                                                     2008            2007        Change
  UTV Radio Ireland operating profit up by 54% to £8.0m                                               £m             £m             £m
  (2007: £5.2m) after start up losses at our Belfast station of   Radio GB                            10.4           11.4          (1.0)
  £0.5m (2007: £0.7m loss)                                        Radio Ireland                       8.0            5.2            2.8
                                                                  Total Radio                         18.4           16.6           1.8

  Television operating profit down to £7.7m (2007: £10.1m)        Television                          7.7            10.1          (2.4)
                                                                  New Media                           2.0            1.4            0.6
                                                                  Operating Profit from
  New Media operating profit up by 44% to £2.0m (2007:            continuing operations               28.1           28.1           0.0
  £1.4m)                                                          Discontinued operations             (1.5)          (2.0)          0.5
                                                                  Total Operating Profit              26.6           26.1           0.5


UTV Media plc | Preliminary Results 2008                                                                        No | 5
FINANCIAL OVERVIEW | 2008 Preliminary Results




  Net finance cost of £8.1m (2007: £7.4m)
                                                                                        21.0                20.8    20.3
                                                                                               18.8
                                                                              17.5
  Effective tax rate of 21.7% (2007: 23.5%)



  Net exceptional loss of £5.6m (2007: gain of £0.4m)
                                                                Note - Prior years have been adjusted for discontinuing operations
  - Restructuring costs £2.8m
                                                                                                  2008              2007    Change
  - Write off investment in 4Digital £0.3m                                                            £m            £m         £m
                                                                Group operating profit            28.1              28.1       0.0
  - Financing costs £1.4m
                                                                Foreign exchange gain                 0.3           0.1        0.2
  - Exceptional tax charge £0.4m                                Net finance costs                 (8.1)             (7.4)     (0.7)
                                                                Profit pre-tax, pre-

  - Discontinued operations £0.7m                               exceptionals                      20.3              20.8      (0.5)

                                                                Exceptional items                 (4.5)             (1.0)     (3.5)
  (Note: £1.1m classified in tax and discontinued operations)   Group pre-tax profit              15.8              19.8      (4.0)

                                                                Taxation                          (4.4)             (4.9)      0.5
                                                                Exceptional tax                   (0.4)             1.4       (1.8)
  Pension deficit increased by £6.7m to £8.6m (2007: £1.9m)     Discontinued operations           (1.7)             (1.4)     (0.3)
                                                                Profit after taxation                 9.3           14.9      (5.6)



UTV Media plc | Preliminary Results 2008                                                                           No | 6
FINANCIAL OVERVIEW | 2008 Preliminary Results




                                                                                                             13.0   13.5
                                                                                                      12.5
                                                                                               11.5
                               24.99
                                                    24.14
                     21.19               21.26
                                                             18.83
                                                                                                                           5.3




     Note – Figures inclusive of discontinued operations and effect of rights issue



      Diluted adjusted earnings per share                                             Recommended final dividend payment of
      down by 22% to 18.83p (2007: 24.14p)                                            2.00p (2007: 8.30p), making a full year
                                                                                      dividend of 5.30p (2007: 13.50p)
      Diluted adjusted earnings per share from
      continuing operations down by 24% to                                            Total dividend of £5.1m (2007: £7.6m)
      20.20p (2007: 26.53p)



UTV Media plc | Preliminary Results 2008                                                                                         No | 7
FINANCIAL OVERVIEW | 2008 Preliminary Results




   New borrowing facilities in place to 2013
   During 2008 Net Debt increased by £0.4m to £107.6m (2006:
   £107.2m) including Euro borrowings of €46.8m (sterling
                                                               Net Debt at 31 December
   equivalent £44.8m)
                                                                                 2008    2007      Change
   The Group currently has borrowing facilities of £138.4m                       £m       £m        £m
                                                               Bank Loans
   Group facilities headroom of £20.7m                         Current           8.6     10.3       1.7
                                                               Non-current      108.3    107.1      (1.2)
   Approximately 49% of total debt is fixed at a blended                        116.9    117.4      0.5
   interest rate of 4.32% plus applicable margin
                                                               Less Cash         9.3     10.2       (0.9)
   Margin on Libor and Euribor at December 2008 165bps
                                                               Net Debt         107.6    107.2      (0.4)


Covenants at 31 December 2008
   Net Debt: EBITDA ratio is 3.58x (2007: 3.82x)
   EBITDA: Interest cover of 3.84x (2007: 4.01x)




 UTV Media plc | Preliminary Results 2008                                                 No | 8
FINANCIAL OVERVIEW | 2008 Preliminary Results



  Free cash flow increased by £3.3m to £27.0m (2007:£23.7m)
                                                                Cash Flow
                                                                                             2008      2007     Change
  Net cash flow from operations remained constant at £8.7m                                   £m        £m        £m


                                                                EBITDA                       28.4      27.8      0.6
  Increased interest costs of £2.8m to £9.5m (2007: £7.1m)      Capital Expenditure          (1.9)     (1.2)     (0.7)
  including an exceptional interest charge of £1.4m             Working Capital              2.0       (1.2)     3.2
                                                                Exceptional Costs            (1.5)     (1.7)     0.2
                                                                Free Cash Flow from
  Cash effective rate of tax is approximately 10%               Operations                   27.0      23.7      3.3
                                                                Finance Cost                 (9.5)     (7.1)     (2.4)
                                                                Tax                          (0.4)     (0.4)     0.0
  Acquisitions of £46.2m relate to Tibus and FM104 which were   Dividends                    (7.9)     (7.2)     (0.7)
  partly financed by new facilities                             Other                        (0.5)     (0.3)     (0.2)
                                                                Net Cash Flow from
                                                                Operations                   8.7       8.7       0.0

  The company has agreed special pension payments of £5.3m      Share placing                0.0       5.3       (5.3)

  over 3 years - £1m paid in 2008                               Acquisitions
                                                                Pension
                                                                                            (46.2)
                                                                                             (1.0)
                                                                                                       (1.1)
                                                                                                       0.0
                                                                                                                (45.1)
                                                                                                                 (1.0)
                                                                Rights issue                 47.5      0.0       47.5

  In July 2008 the company undertook a 2 for 3 rights issue     Debt translation
                                                                Deferred financing costs
                                                                                             (9.4)
                                                                                             0.0
                                                                                                       (2.1)
                                                                                                       (0.4)
                                                                                                                 (7.3)
                                                                                                                 0.4
  raising net proceeds of £47.5m
                                                                Movement in Net Debt         (0.4)     10.4     (10.8)


  Euro denominated debt translation loss of £9.4m as Euro       Net Debt at start of Year   (107.2)   (117.6)

  exchange rate at year end 1.046 (2007: 1.355)                 Net Debt at end of Year     (107.6)   (107.2)



UTV Media plc | Preliminary Results 2008                                                              No | 9
RADIO – GB

   UTV Media plc Preliminary Results 2008




                                            No | 10
RADIO GB | Radio Listenership


    Portfolio includes one of three Independent National
    Radio (INR) stations, talkSPORT and 15 Independent
    Local Radio (ILR) stations throughout GB

    talkSPORT remains the most efficient broadcaster for
    advertisers targeting a male audience

    talkSPORT continues to attract new talent, such as
    Stan Collymore and Darren Gough to complement
    existing presenters such as Ian Wright, Alan Brazil and
    Andy Townsend

    talkSPORT recorded its highest ever audience of 2.52m,
    making five consecutive years of audience growth

    Management restructuring and co-location of ILR
    services will enable renewed focus on ILR audiences

                             Q u arter E n d in g D ecem b er 2008
                                  R each            H o u rs         M ale   F em ale   AB C 1
                                   ('000)            ('000)           %         %         %

 talk S P O R T                   2,515             17,996            78       22        54

 U T V excl talk S P O R T        1,290             10,910            47       53        49

 U T V incl talk S P O R T        3,620             29,134            67       33        53



UTV Media plc | Preliminary Results 2008                                                         No | 11
RADIO GB | 2008 Preliminary Results



   Advertising revenue in the UK radio market fell by 6% in       Radio GB
   2008                                                                                      2008       2007    Change
                                                                                              £m         £m       £m

                                                                  Turnover
   Total advertising revenue in UTV’s GB radio stations was       talkSPORT                  22.5       21.4      1.1
   down by 1%                                                     talkSPORT Magazine          0.2        0.0      0.2
                                                                  ILRs - Existing stations   23.1       24.8     (1.7)
                                                                         Central              0.1        0.0      0.1
   Advertising revenue in talkSPORT was up by 6%                                             45.9       46.2     (0.3)
                                                                  Operating costs
                                                                  talkSPORT                  15.9       15.6     (0.3)
   Advertising revenue in our continuing ILR operations fell      talkSPORT Magazine          0.7        0.0     (0.7)
                                                                  ILRs - Existing stations   18.8       19.5      0.7
   by 6%                                                                  Central             0.4        0.0     (0.4)
                                                                                             35.8       35.1     (0.7)

   Operating profit for UTV Radio (GB) after start up losses in   Operating profit
                                                                  talkSPORT                   6.6        5.8      0.8
   Central FM of £0.3m and talkSPORT Magazine of £0.5m            talkSPORT Magazine         (0.5)       0.0     (0.5)
   was £10.4m of which:                                           ILRs - Existing stations    4.3        5.3     (1.0)
                                                                          Central            (0.3)       0.0     (0.3)
                                                                                             10.1       11.1     (1.0)
   - talkSPORT delivered £6.1m                                    Income from associates      0.3        0.3      0.0
   - ILRs delivered £4.0m                                                                    10.4       11.4     (1.0)

   - Income from associates delivered £0.3m                       Discontinued operations    (1.5)      (2.0)     0.5
                                                                                              8.9        9.4     (0.5)


UTV Media plc | Preliminary Results 2008                                                             No | 12
RADIO GB | Current Trading and Prospects

  UK Radio advertising market is expected to decrease by 23% in Q1 with
  national down 28% and local down 11%

  Q1 advertising revenues in our GB stations are expected to be down by 15% on
  a like for like basis with:
  - talkSPORT down by 17%
  - Local radio down by 12%

  Enhanced presenter line-up, along with the Ashes and the ICC World Twenty20
  tournament coverage will further strengthen talkSPORT’s audience
  proposition

  Awaiting the outcome of the Digital Britain report form Lord Carter

  Forecast losses for Central FM, our start up station in Central Lancashire of
  £0.2m (2008: £0.3m)

  Further cost savings of £1.8m identified in 2009

UTV Media plc | Preliminary Results 2008                                          No | 13
RADIO – IRELAND

   UTV Media plc Preliminary Results 2008




                                            No | 14
RADIO IRELAND| Radio Listenership 2008


    UTV owns market leading stations in key urban areas in
    Ireland
    UTV also sells airtime in two other major urban areas,
    being Galway and the South East region
    These regions account for 67% of the adult population on
    the island of Ireland and within these regions, 51% of
    adults listen each week to UTV sold stations
    Listenership data was published by the Joint National
    Listenership Research (JNLR) in February 2009 showing:
                         Listenership Reach and Share
                                    Daily         Market       Share
                                    Reach         Share    at Acquisition
                                      %             %            %
    96FM/C103FM (Cork)                50           47.8         50.0
    95FM (Limerick)                   55           43.9         31.0
    LMFM (Dundalk/Drogheda)           32           34.5         31.0
    Q102 (Dublin)                     11            7.0          5.0
    FM104 (Dublin)                    20           13.3         12.4

    Source: JNLR Jan-Dec 2008 / RAJAR weeks 26-50 2008


    U105 in Belfast, which broadcasts to a population of
    838,000, achieved a reach of 108,000 adults and 1,008,000
    listening hours in the January 2009 RAJAR

UTV Media plc | Preliminary Results 2008                                    No | 15
RADIO IRELAND | 2008 Preliminary Results




    Total advertising revenue was up by 50%                     Radio Ireland
                                                                                            2008       2007    Change
                                                                                             £m         £m       £m

    Total advertising revenue increased by 16% on a like for    Turnover
    like basis                                                  ROI -   Existing stations
                                                                        FM104
                                                                                            18.4
                                                                                             5.6
                                                                                                       15.9
                                                                                                        0.0
                                                                                                                2.5
                                                                                                                5.6

                                                                Belfast - U105               0.9        0.7     0.2
    Total advertising revenue was up by 1% on a like for like                               24.9       16.6     8.3
    basis in local currency                                     Operating costs
                                                                ROI -   Existing stations   11.6       10.0     (1.6)
                                                                        FM104                3.9        0.0     (3.9)
    UTV Radio (Ireland) operating profit up 54% to £8.0m
                                                                Belfast - U105               1.4        1.4      0.0
    (2007: £5.2m) of which:                                                                 16.9       11.4     (5.5)

                                                                Operating profit
    -    Existing stations increased by 15% to £6.8m            ROI -   Existing stations   6.8        5.9      0.9
                                                                        FM104               1.7        0.0      1.7
    -    FM104, acquired on 10 April 2008, delivered £1.7m
                                                                Belfast - U105              (0.5)      (0.7)    0.2
    -    Start up losses in U105 decreased by £0.2m to £0.5m                                 8.0        5.2     2.8




UTV Media plc | Preliminary Results 2008                                                            No | 16
RADIO IRELAND | Current Trading and Prospects




   Q1 advertising revenues in our Irish stations expected to be up by 35% with
   currency translation gain and FM104 contributing 50% growth

   Like for like Euro revenues are forecast to decline by 15%

   A levy will be introduced from 1 October 2009 to fund the new Broadcasting
   Authority of Ireland (likely to be in the range of 1-2% of turnover)

   Forecast losses of £0.1m for U105 in 2009

   Further cost savings of £1.8m identified in 2009




UTV Media plc | Preliminary Results 2008                                         No | 17
TELEVISION

   UTV Media plc Preliminary Results 2008




                                            No | 18
TELEVISION | 2008 Peak Time Viewership Performance



  ITV1’s viewing share declined to 23.9% (2007: 25.3%)
                                                               34.5          34.0
                                                                                            33.5
                                                                                                           32.0
                                                                      30.6
  UTV has consistently outperformed the ITV1 Network and                            29.0                                 29.2
                                                                                                   26.8
  in 2008 had:                                                                                                    25.3
                                                                                                                                23.9

  - 22% more viewership than ITV1 with a share of 29.2%
  - 41% more viewership than BBC1 Northern Ireland
  - a share of 29.2% which compares favourably to multi-
    channel viewing at 31%
  - more than three times the viewership of Channel 4, the
    nearest commercial competitor                                                                                 31.0 31.8
                                                             29.2
  - UTV had a 6.8% peak-time share in the 80% of Republic           23.9
                                                                        20.7
                                                                            23.4

    of Ireland homes which are multi-channel
                                                                                          8.6
                                                                                                8.1 7.2
  and                                                                               7.1
                                                                                                          3.9 5.1             4.1

  - a decline in commercial impacts from 2003-2008 of 2%                                                                            0.0


    compared to a 15% decline in ITV1


UTV Media plc | Preliminary Results 2008                                                                          No | 19
TELEVISION | 2008 Advertising Revenue Performance




                                                         16.0


  UK television advertising market down by 5.0%                 2.6


                                                                                             (1.7)
                                                                  (3.8) (3.3)                        (4.0)
                                                                                                             (7.4)
                                                                                (9.1)                                (8.1)
                                                                                        (12.2)
  ITV1 advertising revenue down by 8.1%



  UTV advertising revenue down by 7.4%
                                                                                                              2.92
                                                                                                 2.87
                                                                                 2.82
                                                         2.69         2.68
  Record share of ITV1 revenues of 2.92% (2007: 2.87%)




UTV Media plc | Preliminary Results 2008                                                             No | 20
TELEVISION | 2008 Preliminary Results




                                                             Television
                                                                                        2008     2007    Change
   Turnover down by 8% to £38.0m (2007: £41.3m)                                         £m        £m       £m


                                                             Revenue
                                                             Airtime                    34.8     38.2     (3.4)
                                                             Sponsorship                1.8       1.7     0.1

   Television operating profit down by 24% to £7.7m (2007:   Other                      1.4       1.4     0.0

   £10.1m)                                                                              38.0     41.3     (3.3)


                                                             Operating costs
                                                             Salaries (inc. pensions)   8.5       7.8     (0.7)
                                                             Network programmes         9.6       9.5     (0.1)
                                                             Direct sales costs         3.2       3.9     0.7
                                                             Depreciation               0.7       0.7     0.0
                                                             Other costs                8.3       9.3     1.0
                                                                                        30.3     31.2     0.9


                                                             Operating profit           7.7      10.1     (2.4)




UTV Media plc | Preliminary Results 2008                                                       No | 21
TELEVISION | Current Trading and Prospects


  Total UK television advertising market in Q1 is forecast to be down by 17%


  ITV1’s network advertising revenue in Q1 is forecast to be down by 21%


  UTV’s advertising revenue in Q1 is likely to be down by 19%


  OFT and OFCOM review of CRR announced but unlikely to have an impact
  before the end of 2009


  As CRR does not apply to UTV’s Irish advertising revenue, UTV should
  outperform ITV Network revenue in 2009


  Further cost savings of £1.3m identified in 2009




UTV Media plc | Preliminary Results 2008                                       No | 22
NEW MEDIA

   UTV Media plc Preliminary Results 2008




                                            No | 23
NEW MEDIA | 2008 Preliminary Results and Prospects



   Total turnover increased by 17%, driven by the acquisition
                                                                                          11.5
   of Tibus
                                                                              9.5   9.8

                                                                        8.1
   New Media operating profit up 44% to £2.0m (2007: £1.4m)
   of which                                                      5.2
   - UTV Internet increased 17 % to £1.6m (2007: £1.4m)
   - Tibus delivered £0.4m (2007: Nil)

   Turnover in Q1 expected to be marginally up on a like for
   like basis but ....
   Improved margins should lead to sustained profitability                                2.0

   levels on the existing business
                                                                                    1.4
                                                                              1.1
   Further cost savings of 0.1m identified in 2009              0.9
                                                                       0.8




UTV Media plc | Preliminary Results 2008                                              No | 24
CONCLUSION


      Solid result in difficult market conditions

      Out performance in both TV and Radio divisions

      Loss making radio stations disposed of

      Acquisitions successfully integrated

      Cost reduction programme implemented and additional savings of £5m
      identified in 2009

      Rights issue successfully completed

      Refinancing in place through to 2013




UTV Media plc | Preliminary Results 2008                                   No | 25

				
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