Preliminary Results – Year to 30 April 2009
PRESENTATION TO INVESTORS AND ANALYSTS 2 July 2009
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Legal disclaimer
This presentation contains statements that are or may be forward-looking statements with respect to the financial condition, operations and businesses of Photo-Me. All statements other than statements of historical facts included in this presentation may be forward-looking statements. These forward-looking statements involve known and unknown risk, uncertainties and other factors which may cause the actual performance or achievements of Photo-Me, or industry results, to be materially different from any performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding the present and future business strategies of Photo-Me and the environment in which it will operate in the future which are not necessarily indicative of future outcomes or the financial performance of PhotoMe and should not be considered in isolation.
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PRESENTERS
Hugo Swire Chairman
Introduction & Conclusion
Thierry Barel Chief Executive Officer
Business Review
Robert Lowes Company Secretary
Financial Review
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WWW.PHOTO-ME.COM
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OVERVIEW
Photo-Me seeks to strengthen its position as a leading operator, supplier and servicer of instant service equipment, building on:
Long term and broad commercial relationships
c. 43,000 sites in 15 countries
Extensive service and cash collection network
c.1,000 field engineers
Innovative and diversified products
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KEY POINTS
2008/09:
• • • • • £38.1m: net cash generated from operating activities = £23.5m: net debt almost halved
(incl. Imaging Solutions)
65% 48% +£7.9m
=
£1.6m: pre-exceptional PBT on continuing operations = Decision to sell Imaging Solutions -£17.7m: post-exceptional loss from combined activities
2009/10:
• • Further improvement, on continuing pre-exceptional operations Strong debt reduction
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FINANCIAL REVIEW
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INCOME STATEMENT
Year to 30 April (£m)
(on continuing operations)
2009 Preexceptionals Postexceptionals
2008 Preexceptionals Postexceptionals
Revenue: As reported At constant rates EBITDA Operating profit PBT Loss from all operations
(including discontinued)
210.5 183.5 38.6 5.0 1.6
210.5 183.5 37.3 (1.7) (5.1) (17.7)
193.5 193.5 33.0 (2.6) (6.3)
193.5 193.5 25.5 (17.8) (20.9) (19.8)
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BY DIVISION
Revenue
Operating Profit
Year to 30 April (£m)
(on continuing operations, excluding exceptional items)
2009 2009†
2008
2009
2009†
2008
Operations Sales & Servicing Group overheads: Underlying Intercompany forex
166.1 44.4
144.4 39.1
148.8 44.7
12.1 (5.2)
10.3 (4.4)
9.1 (7.1)
210.5
183.5
193.5
(4.0) 2.1 5.0
(4.0) 2.1 4.0
(4.6) (2.6)
† at 2008 exchange rates
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BY GEOGRAPHIC AREA
Revenue
Operating Profit
Year to 30 April (£m)
(on continuing operations, excluding exceptional items)
2009
2009†
2008
2009
2009†
2008
Continental Europe UK & Ireland: Underlying Intercompany forex Asia
115.8
99.4
105.4
0.4
0.4
(3.4)
57.2 37.5
56.7 27.4
60.4 27.7
(1.3) 2.1 3.8
(1.3) 2.1 2.8
(1.6) 2.4
Total
210.5
183.5
193.5
5.0
4.0
(2.6)
† at 2008 exchange rates
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EXCEPTIONALS
Year to 30 April (£m) Impairments: Sales & Servicing R&D Operations equipment Stocks Restructuring: Redundancy/other Previous Strategic Review Finance revenue 1.2 6.7 3.2 4.3 (0.5) 14.6 5.0 0.5 5.5 2.7 4.2 0.7 7.6 2009 2008
Continuing operations only
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BALANCE SHEET
At 30 April (£m) Non-current assets (exc deposits) Current assets (exc cash and deposits) Non-current liabilities (exc borrowings) Current liabilities (exc borrowings) Net debt Total equity Minority interests Total shareholders’ equity Gearing Equity per share
2009 Reported 99.3 48.0 (8.4) (41.8) (23.5) 73.6 (0.7) 72.9 32% 20.3p
2009 L4L 100.9 62.3 (12.4) (45.6) (23.5) 81.7 (1.2) 80.5 29% 22.4p
2008 Reported 115.7 70.5 (12.8) (48.3) (45.6) 79.5 (2.6) 76.9 57% 21.4p
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BORROWINGS/FACILITIES
At 30 April (£m) Overdrafts Loans <1 year Loans > 1 year Finance leases Gross borrowings Cash and deposits excluding ISAG Net debt excluding ISAG Imaging Solutions net cash Total net debt Unused facilities 13
2009 (3.2) (12.8) (29.2) (0.6) (45.9) 19.8 (26.1) 2.6 (23.5) 21.2
2008 (22.1) (21.5) (31.9) (0.9) (76.4) 27.6 (45.5) 3.2 (45.6) 14.8
Change -86% -40% -8% -33% -40% -28% -47%
-48% +43%
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CASH FLOW
Year to 30 April (£m) Operating loss from continuing activities Operating loss from discontinued activities Depreciation/amortisation/impairment Working capital movements Interest cost Tax All others Operating cash flow Capex/other investment Free cash flow Dividends/share buy-backs All others Change in net debt 14 2009 (1.7) (7.7) 45.6 9.2 (3.6) (0.3) (3.4) 38.1 (15.5) 22.6 (0.5) 22.1 2008 (17.8) (1.5) 46.9 6.4 (4.5) (8.3) 2.0 23.2 (28.1) (4.9) (12.5) (0.4) (17.8)
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FINANCIAL REVIEW KEY POINTS
Income Statement
£1.6m: pre-exceptional profit on continuing operations £38.6m: EBITDA +£7.9m +17%
Balance Sheet
£23.5m: net debt almost halved (including Imaging Solutions) 20.3p: equity per share -48%
Cash Flow Statement
£38.1m: net cash generation from continuing operations £22.6m: free cash flow
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+65% +£27.5m
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BUSINESS REVIEW
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OPERATIONS: SITES BY TYPE
50 000
42,600
45 000 40 000
35 000
28,000
Number of units 30 000 25 000
20 000
71%
71%
50%
49%
15 000
10 000
5 000
0 2005 Photobooths 2006 Digital Media Kiosks 2007 Amusement Machines 2008 Others 2009
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OPERATIONS: SITES BY COUNTRY
15 Countries
45 40
14%
35 units in thousands 30 25 20 15 10 5 0 2005
14% 18% 17%
Others* Japan
18% 17% 17% 16% 16% 16% 16% 33% 33% 33% % 33 40% 34% 34% 34% 34%
28% 28% 28%
France
40% 42%
UK & Ireland
40%
2009
* Germany, Switzerland, Belgium, The Netherlands, Portugal, Czech Republic, Austria, Hungary, Singapore, Hong Kong, China and (in 2005) the USA
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EXTENSIVE OPERATIONS RANGE
PHOTOBOOTHS
Easybooth
Minibooth
Universal booth
Enrolment Station
Enrolment booth
AMUSEMENT
Kiddie Rides
Boulie Machine
Crane
DanceHeads
X-Putt
Textminator
FX Simulator
SERVICES
Digital Media Kiosk
Business Card Machine
Copiers
Charge Box 2
Self-service launderettes
Umbrolly
Small Packet Vendor
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PHOTOBOOTHS
2% in sites to 21,050 (“Woolworth” effect) 9% in revenues 49% of sites 81% of revenues
Evolution towards digital enrolment More “fun photobooth” (photo vintage) More events (Photo FCUK)
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BIOMETRICS
EU Directive of 30 June 2006 to be adopted by EU members by 30 June 2009 Various types of implementation • France: live enrolment at discretion of town halls • UK: system to be defined but open to private sector • Germany: same network digitalized • Switzerland: on-site enrolment, subject to Canton agreement • Japan: no change Swiss solution will use Photo-Me enrolment stations
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DIGITAL MEDIA KIOSKS
• • • •
8% in sites to 4,950 25% in revenue 12% of sites 9% of revenues
Fast growing market New contracts: Tesco and Co-op in UK, Migros in Switzerland Photobook Maker Vending 09/09 Next: sales of Digital Media (video, music, etc)
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OTHER OPERATIONS
• • • •
2% in sites to 16,600 1% in revenue 39% of sites 10% of revenues
More skill games
(X-putt, FX Simulator, Textminator)
Carousels Top Licences More services
(Umbrolly, Small packet Vendor)
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EXTENSIVE SALES & SERVICING RANGE
SELF-SERVICE
Speedlab 200
Speedlab 100
Kiddie Ride
Photobook Maker
ATTENDED RETAIL
DKS 16XX minilab
DKS 17XX minilab
Photobook Pro
DKS 910 / 920 minilab
WHOLESALE
Fastprint
Fastscan
Wideprint
FastBook
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RETAIL PHOTOGRAPHIC EQUIPMENT
Market still consolidating Credit crunch: investment “Kiosk is King” Sales to other customers 1% (-12%)*
Product mix Average price Dollar effect Yen effect
Substantial loss incurred
Innovation: Photobook Maker Introduced successfully Huge demand from retailers worldwide
* at constant exchange rates
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WHOLESALE PHOTOGRAPHIC EQUIPMENT
Credit crunch and competition from other technologies hit sales Imaging Solutions revenue = -18% (-33%)* Substantial loss Pre-year end Board decision to sell
* at constant exchange rates
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INNOVATION STRATEGY
Technology
Power-Me
New
®
Photobook Maker
Film recorder
Existing ®
Minilabs Digital Media Kiosks
Existing
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Biometrics
New
Market
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COST CUTTING
Merger of German and central European Operations Premises reductions Stock reduction Headcount reduction External cost reduction
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PROSPECTS
Biometric passport ID photo Minilabs
New products Strong cash flow Cost reductions Debt reduction Results
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