Investors presentation Oddo BHF Forum - January 2019

Size: px

Start display at page:

Download "Investors presentation Oddo BHF Forum - January 2019"

Myles Shaw
5 years ago
Views:

1 Investors presentation Oddo BHF Forum - January 2019

2 YMAGIS IN A NUTSHELL European leader for digital technologies and services for the cinema industry 26 countries 180m present in 26 countries across Europe, the US and Africa turnover at end-december employees 9,2m 80 engineers worldwide cash available at end-june 2018 Innovation, a core value for the Group 2

n n o v a t i v e f i n a n c i a l s o l u t i o n B u i l d - u p s t r a t e g y t o c r e a t e t w o E u r o p e a n l e a d e r s i n s e r v i c e s R a t i o n a l i s a t i o n & d i

3 Y M A G I S : F O R E R U N N E R O F T H E D I G I T A L T R A N S F O R M A T I O N O F T H E E N T E R T A I N M E N T I N D U S T R Y B t o B B to B to t o CC D i g i t a l t r a n s i t i o n o f t h e a t e r s D i s t r i b u t i o n & s e r v i c e s a c t i v i t i e s D i s t r i b u t i o n p l a t f o r m s N e w d i g i t a l e n t e r t a i n m e n t T h e V P F, a n i n n o v a t i v e f i n a n c i a l s o l u t i o n B u i l d - u p s t r a t e g y t o c r e a t e t w o E u r o p e a n l e a d e r s i n s e r v i c e s R a t i o n a l i s a t i o n & d i g i t a l t r a n s f o r m a t i o n : f r o m s e r v i c e s t o p l a t f o r m s V i r t u a l R e a l i t y C e n t e r s e S p o r t E u r o p e a n l e a d e r F i r s t p l a y e r 3

4 Highlights Activity

5 F I R S T 9 M O N T H S T U R N O V ER: M, D O W N 8. 3 % 125,6 45,2 41,5 38,2 38,7 38,9 38,1 115,2 0,2 VPF CinemaNext Eclair Others activities 9 months months 2018 Q Q

E C L A I R, C O N T I N U A T I O N O F D I G I T A L I Z A T I O N A N D R E S T R U C T U R I N G O F E C L A I R C I N E M A B U S I N E S

a n d p a r t n e r s h i p s f o r e c o n o m i e s o f s c a l e a n d a u t o m a t e d p r o c e s s i n g > R e s t r u c t u r i n g o

r s f o r c r e a t i v e p r o f e s s i o n a l s ( 1 ) E c l a i r C i n e m a, w h i c h r e p r e s e n t s 1 6 % o f t h e É c l a i r d

6 E C L A I R, C O N T I N U A T I O N O F D I G I T A L I Z A T I O N A N D R E S T R U C T U R I N G O F E C L A I R C I N E M A B U S I N E S S > R a p i d d e v e l o p m e n t o f d i g i t a l p l a t f o r m s a n d s o l u t i o n s > C o m p r e h e n s i v e s o l u t i o n s a n d p a r t n e r s h i p s f o r e c o n o m i e s o f s c a l e a n d a u t o m a t e d p r o c e s s i n g > R e s t r u c t u r i n g o f p o s t - p r o d u c t i o n a n d r e s t a u r a t i o n b u s i n e s s e s ( 1 ) r e d i r e c t e d t o a n e w r a n g e o f o f f e r s f o r c r e a t i v e p r o f e s s i o n a l s ( 1 ) E c l a i r C i n e m a, w h i c h r e p r e s e n t s 1 6 % o f t h e É c l a i r d i v i s i o n t u r n o v e r a n d t h e q u a s i t o t a l i t y o f t h e l o s s e s o v e r H , i s i n r e c e i v e r s h i p 6

C I N E M A NE X T: A N A I R CRAFT C A R R I ER F O R N E W P R O D U CTS > I n t e r n a t i o n a l

s o l u t i o n s t o I M A X a n d D o l b y C i n e m a > F i r s t c o n c r e t e s i g n s o f t

e n t > C i n e m a N e x t : t h e d i s t r i b u t i o n c h a n n e l f o r n e w p r o d u c t s

7 C I N E M A NE X T: A N A I R CRAFT C A R R I ER F O R N E W P R O D U CTS > I n t e r n a t i o n a l r o l l o u t of n e w s o l u t i o n s : S p h e r a a n d E c l a i r C o l o r, c o m p e t i n g s o l u t i o n s t o I M A X a n d D o l b y C i n e m a > F i r s t c o n c r e t e s i g n s o f t h e b e g i n n i n g o f t h e n e w c y c l e o f r e n e w a l o f p r o j e c t i o n e q u i p m e n t > C i n e m a N e x t : t h e d i s t r i b u t i o n c h a n n e l f o r n e w p r o d u c t s a n d n e w b u s i n e s s m o d e l s : V R e n t e r t a i n m e n t c e n t r e s, a n d e S p o r t 7

8 V I R T U A L R E A L I T Y : A N E W S O U R C E O F R E V E N U E A N D P R O F I T > L a u n c h o f t h e n e w v i r t u a l r e a l i t y a r c a d e c e n t e r s o f f e r, C i n e m a N e x t V R f o r c i n e m a e x h i b i t o r s > O p e n i n g o f t h e f i r s t a d v e n t u r e p a r k i n v i r t u a l r e a l i t y, I l l u c i t y, i n P a r i s a t t h e e n d o f N o v e m b e r, w h i c h o p e n s t h e w a y t o a n e t w o r k w i t h d o z e n s o f c e n t e r s 8

E C L A I RGAME, E S P O RT I N C I N E M A S > e S p o r t, a g r o w i n g b u s i n e s s w o r l d w i d e > L a u n c h o f E c l a i r G a m e i n O c t o b e r 2 0 1 7 : o r g

l y d u r i n g w e e k d a y s, a n d a p o t e n t i a l o f a t t r a c t i o n f o r y o u n g a u d i e n c e > 1 st F I F A T O U R i n 2 0 1 8 i n p a r t e r s h i p w i t h

9 E C L A I RGAME, E S P O RT I N C I N E M A S > e S p o r t, a g r o w i n g b u s i n e s s w o r l d w i d e > L a u n c h o f E c l a i r G a m e i n O c t o b e r : o r g a n i z a t i o n o f e S p o r t a n d g a m i n g e v e n t s i n c i n e m a s > A s o l u t i o n t o a l o w ( 1 5 % ) c i n e m a r a t e o f o c c u p a n c y e s p e c i a l l y d u r i n g w e e k d a y s, a n d a p o t e n t i a l o f a t t r a c t i o n f o r y o u n g a u d i e n c e > 1 st F I F A T O U R i n i n p a r t e r s h i p w i t h G a u m o n t P a t h é c i n e m a s > S t r o n g g r o w t h w i t h g o o d p r o f i t a b i l i t y e x p e c t e d w i t h a t u r n o v e r c l o s e t o 0. 7 M i n e. 9

10 Half-year earnings and financial situation Finance

11 H A L F - Y EAR N E T L O S S O F 2, 6 M m H H Chg (%) Revenues (3.7)% EBITDA (21.3)% Depreciation (14.2) (17.6) 19.3% EBITDA 4.8m contraction, split almost equally between the business units Launch of new activities contributed 0.9m to this drop Recurring operating income (ROI) (35.4)% Non-recurring expenses EBIT (35.4)% Net financial expenses (2.9) (2.3) (22.7)% EBT (1.3) 0.1 na Share of income from minorities (0.3) 0.0 na Corporate income tax (1.0) (2.2) 53.2% EBIT EBT Down 1.3m 1.8m improvement in VPF EBIT offset by the decrease recorded by CinemaNext ( 0.7m) and Eclair ( 1.4m) Financial expenses up 0.6m, linked to interest payments on Oseo and EuroPP borrowings Net income, Group share (NI) (2.6) (2.1) (24.1)% EBITDA as % of revenues 19.9% 24.3% ROI as % of revenues 2.0% 3.0% RN Lower tax expense linked to the contraction in earnings for companies managing VPF NI as % of revenues (3.3)% (2.5)% 11

12 C O N T R IBUTION F O R E A C H B U S I NE S S U N I T Virtual Print Fee CinemaNext m H H Chg (%) H H Chg (%) Revenues (14.6)% % EBITDA (5.6)% (1.4) (0.3) (345.1)% EBIT % (1.5) (0.8) (86.0)% EBT % (1.9) (1.3) (44.2)% EBITDA as % of revenues 76.0% 68.7% (5.5)% (1.3)% EBIT as % of revenues 34.0% 23.1% (5.7)% (3.2)% EBT as % of revenues 27.6% 18.3% (7.3)% (5.2)% VPF Improvement in indicators linked to the financing model in place, as finance leases are gradually maturing CinemaNext Eclair Delay linked to the deferral to H2 of major multiplex extension projects in Germany and Eastern Europe Eclair Other business m H H Chg (%) H H Chg (%) Rationalization efforts undermined by the poor performance by creative activities in France and the price war for content management and distribution. Only versioning has improved its performance Revenues % Autres activités EBITDA (2.7) (1.1) (144.9)% (0.4) - - EBIT (5.4) (4.0) (34.9)% (0.6) - - EBT (6.2) (4.3) (42.1)% (0.6) - - Investments linked to the launch of EclairGame and virtual reality EBITDA as % of revenues (10.2)% (4.2)% na na EBIT as % of revenues (19.9)% (15.1)% na na EBT as % of revenues (22.8)% (16.3)% na na 12

13 B A L A N CE S H E E T A T 3 0 JUNE m H H Fixed assets Shareholders' equity Other Financial debt over 1 year Non-current assets Other non-current liabilities Inventories Non-current liabilities Trade receivables Other current assets Financial debt under 1 year Cash Other current liabilities Current assets Current liabilities ASSETS LIABILITIES

D E B T S T R U CTURE A T 3 0 JUNE 2 0 1 8 m H1 2018 2017 Finance leases 7.4 13.1 Financial debt 1.8 1.8 Factoring 0.8 0.

6 Financial debt EuroPP, Oseo borrowings and bank overdrafts Financial debt 57.0 56.8 Factoring 2.2 2.0 Other debt facilities 62.2 63.

14 D E B T S T R U CTURE A T 3 0 JUNE m H Finance leases Financial debt Factoring VPF debt facilities Repayment of over 5.6m of lease costs linked to financing for digital equipment VPF debt facilities Finance leases Financial debt EuroPP, Oseo borrowings and bank overdrafts Financial debt Factoring Other debt facilities Cash: 9,2m at 30 June 2018 Including 1.5m blocked for repayment of the VPF loan in Belgium GROSS DEBT Cash (9.2) (15.7) NET DEBT Gearing 2,1 EBITDA Gearing (180 days)

15 E V O L U TI ON O F V P F G R O S S D E B T A N D C A S H 15

16 F O C U S : E C L A IR C I N E M A > P l a c e d u n d e r j u d i c i a l r e v i e w o n N o v e m b e r 2 0, Figures at the end of October 2018 m Revenues 6.3 EBIT (3.2) EBT (3.1) Staff 62 > C l o s u r e o f P o s t - P r o d u c t i o n a c t i v i t i e s i n F r a n c e w h i c h a r e u n p r o f i t a b l e a n d i n an a t o m i z e d m a r k e t > R e s t r u c t u r i n g F r e n c h R e s t o r a t i o n a c t i v i t i e s t o a l i g n t h e o r g a n i z a t i o n w i t h t h e a n n o u n c e d d e c l i n e i n C N C s u b s i d i e s > 2 / 3 o f E c l a i r C i n e m a s w o r k f o r c e s h o u l d l e a v e b y t h e e n d o f t h e f i r s t q u a r t e r o f T h e c o s t s r e l a t e d t o t h e s e d e p a r t u r e s a r e b o r n e b y t h e A s s o c i a t i o n p o u r l a g e s t i o n d u r é g i m e d e G a r a n t i e d e s c r é a n c e s d e s S a l a r i é s ( A G S ) 16

17 Virtual reality Outlook

18 A N A T U R A L G R O W T H D R I V E R F O R T H E C I N E M A I N D U S TR Y > V R g o e s b e y o n d h o m e u s e. C o m m o n f e a t u r e s w i t h c i n e m a : c o l l e c t i v e e x p e r i e n c e s, a m p l i f i e d s e n s a t i o n s. C o n t e n t i m p o s s i b l e t o f i n d a t h o m e > V R f i n d s i t s s o u r c e i n c i n e m a b u t p r o m i s e s t o g o m u c h f u r t h e r > A n e x p e r i e n c e h a l f w a y b e t w e e n c i n e m a a n d v i d e o g a m e s : a t t h e c r o s s r o a d s o f s e v e r a l t y p e s o f e x p e r i e n c e s > M a s t e r e d t e c h n o l o g i e s p r o g r e s s i n g r a p i d l y : w e a r e n o l o n g e r a t t h e e x p e r i m e n t a l s t a g e 18

19 V R : O U R V I S I O N 5 k e y d i r e c t i o n s : A p r e m i u m c o n c e p t, m o d u l a r w i t h s t a n d a r d i z e d s p a c e s e x p l o i t i n g v i r t u a l r e a l i t y 1. O n l y o f f e r e x p e r i e n c e s t h a t t h e p u b l i c c a n n o t f i n d a t h o m e 2. A m o d u l a r c o n c e p t f o r a l l t y p e s o f l o c a t i o n s ( c i n e m a s, s h o p p i n g c e n t e r s, e t c 3. A d i v e r s i t y o f c o n t e n t s a t t r a c t i v e t o a l l f a m i l y m e m b e r s 4. S p e c i a l i z i n g o n p r e m i u m e x p e r i e n c e s 5. S t a n d a r d i z e d s p a c e s a l l o w i n g t o b r i n g t o t h e p u b l i c c a t a l o g s o f d i v e r s i f i e d e x p e r i e n c e s 19

20 A H U G E P O T E N T I AL F O R L B E - VR IN E U R O PE A N D I N T E R N ATIONA L L Y L B E - VR : «l o c a t i o n b a s e d e n t e r t a i n m e n t VR» C e n t e r s o r p l a c e s d e d i c a t e d t o e n t e r t a i n m e n t u s i n g V R a s a d i s t r a c t i o n d e v i c e 20

C R E A T ION O F A VR S T A N D ARD A l l o

i z a t i o n a n d g i v i n g n e w p e r s

Deployment by standard space Efficiency,

u m b e r o f e x p é r i e n c e s «o n d e

content quality R a p i d d e p l o y m e n t

o n Amortization of contents Partnership with

21 C R E A T ION O F A VR S T A N D ARD A l l o w i n g b e t t e r c o n t e n t s a m o r t i z a t i o n a n d g i v i n g n e w p e r s p e c t i v e s t o p r o d u c e r s Brand and network power Profitability Modular approach Parks with standard spaces Deployment by standard space Efficiency, speed, optimization E n r i c h i n g t h e n u m b e r o f e x p é r i e n c e s «o n d e m a n d» High turnover Faster with better content quality R a p i d d e p l o y m e n t t h a n k s t o i n d u s t r i a l i s a t i o n Amortization of contents Partnership with producers Network effect Multiplication of "standard" rooms 21

22 T W O C O M P L E M ENTARY O F F E R S F O R Y M A G I S 1. CinemaNext VR: VR arcades zones for cinema exhibitors Diversify customer base, increase traffic and conquer the millennials target 2. Illucity: "micro-parks" of VR attractions Develop a mixed-model operator, co-operator and franchise Areas from 30 to 100 m2 Operated by the exhibitor who will pool his human resources Sale or rental of equipment, and revenue sharing model White label brand or Illucity Areas from 500 to 2,000 m2 Dedicated staff (between 12 and 20 per site) Centres operated by Ymagis, centres in partnership with cinema operators and franchised centres Illucity brand 22

23 C I N E M A NE X T V R O F F E R : S I M P L E A N D E A S Y T O O P E R A TE S O L U T I ONS VR ARENA ARCADE DYNAMIC SEATS 2 à 4 25 m2 1 à 2 7 m2 1 7 m2 players surface players surface player surface I n s t a l l a t i o n i n c i n e m a h a l l s o r o t h e r a v a i l a b l e on- s i t e s p a c e s 23

24 C I N E M A NE X T V R B U S I N ESS M O D E L > F o r a s p a c e o f a b o u t 5 0 m ², a n i n v e s t m e n t o f 8 0 t o K f o r t h e e x h i b i t o r ( w i t h a p o s s i b i l i t y o f r e n t i n g ) t a r g e t sites i n s t a l l e d > R e v e n u e s h a r e m o d e l : Y m a g i s r e c e i v e s a p e r c e n t a g e o f t h e t i c k e t i n g r e v e n u e, r e m u n e r a t e s t h e b e n e f i c i a r i e s, b e a r s t h e c o s t o f s u p p o r t a n d g e n e r a t e s a m a r g i n > H i g h m a r g i n f o r t h e e x h i b i t o r w h o c a n o p t i m i s e i t s r e s o u r c e s ( r e a l e s t a t e a n d H R ) > N e t c o n t r i b u t i o n m a r g i n f o r Y m a g i s e s t i m a t e d b e t w e e n 2 0 a n d 6 0 K p e r y e a r, p e r s i t e A v e r y a t t r a c t i v e m o d e l f o r e x h i b i t o r s w h i c h l e a v e s a g o o d p r o f i t a b i l i t y t o Y m a g i s 24

surface player surface F o u r t y p e s o f c o n t e n t t o c r e a t e a s p a c e t h a t o f f e r s

25 I L L U CITY O F F E R : T H E B E S T O F V R I N A S I N G L E S P A CE FREE-ROAMING ESCAPE GAME ARCADE & SIMULATORS CINEMA 2 à m2 2 à 4 30 m m2 1 4 m2 players surface players surface players surface player surface F o u r t y p e s o f c o n t e n t t o c r e a t e a s p a c e t h a t o f f e r s a w i d e c h o i c e : 2 0 d i f f e r e n t e x p e r i e n c e s o n t h e s i t e o f L a V i l l e t t e 25

26 I L L U CITY B U S I N ESS M O D E L > R e n t b e t w e e n 7 0 e t / m t a r g e t b e t w e e n 6 a n d 1 2 sites i n s t a l l e d > R e v e n u e f r o m t i c k e t s a l e s o A r c a d e o u c i n é m a t i c k e t f r o m 5 t o 1 2 o F r e e r o a m i n g t i c k e t f r o m 1 5 t o 3 5 o E s c a p e g a m e t i c k e t : 3 0 > C o n t e n t s e x p e n s e s : a b t. 2 0 % o f s a l e s a n d c o m m u n i c a t i o n e x p e n s e s : 8 0 L / yr p e r s i t e > O p e r a t e d b y Y m a g i s, i n p a r t n e r s h i p o r f r a n c h i s e A u t o n o m o u s o p e r a t i o n c e n t e r s 26

27 I L L U CITY C E N T E R S K E Y I N D I CATORS Occupancy rate Avg purchase sales / center F o r a 1, m ² s p a c e 3 5 t o 4 5 % 2 0 a b t. 2 m I n v e s t i s s e m e n t : a b t m EBIT margin 2 0 t o 3 0 % Payback (months) 1 8 t o 2 4 P a y b a c k b e l o w 2 y e a r s 27

O U R A M B I T I ON I N V R To become an international player operating recreation centers in virtual reality Paris France Europe Middle East USA Asia 6 to

28 O U R A M B I T I ON I N V R To become an international player operating recreation centers in virtual reality Paris France Europe Middle East USA Asia 6 to 12 new sites in to 24 new sites in new sites per year afterwards 100 new sites in new sites in new sites per year afterwards 28

29 O U R VR R O A D M A P > P r o j e c t l a u n c h e d i n J a n u a r y T o b e c o m e t h e E u r o p e a n, e v e n g l o b a l, n u m b e r 1 o f m u l t i - f o r m a t V R p a r k s > O p e n i n g o f t h e 1 st I l l u c i t y c e n t e r «p r o t o t y p e» e n d - n o v e m b r e i n P a r i s, p o r t e d e l a V i l l e t t e > F i r s t i n s t a l l a t i o n s o f C i n e m a N e x t V R : D e c e m b e r > N e x t o p e n i n g I l l u c i t y i n M a r s e i l l e, o n - g o i n g d i s c u s s i o n s i n N a n t e s, L i è g e ( B e l g i u m ), B r e s t, P a r i s - B e r c y, N i c e, T o u l o n... > I n t a l k s w i t h s e v e r a l i n t e r n a t i o n a l c i n e m a e x h i b i t o r s ( M i d d l e E a s t, E u r o p e ) > F r a n c h i s e p r o g r a m i n p r e p a r a t i o n ( l a u n c h t a r g e t M a r c h ) 29

30 V R P R O J E CT F I N A N C ING > S t a r t - u p c o s t s ( a r o u n d 1 m ) : f u n d e d o v e r s h a r e h o l d e r s e q u i t y > F i r s t I l l u c i t y s i t e s f u n d e d w i t h a s i t e p e r s i t e b a n k f i n a n c i n g > O p e r a t i o n s p r o f i t a b i l i t y t o s e c u r e t h e d e v e l o p m e n t > O t h e r f u n d i n g o p p o r t u n i t i e s a r e c o n s i d e r e d t o a c c e l e r a t e t h e d e v e l o p m e n t 30

I L L U CITY L A V I L L E TTE > A b o u t 1 0 0 k i n t u r n o v e r s i n c e t h e o p e n i n g > G a m e s a c c l a i m e d b y c u s t o m e r s : a s s a s s i n s c r e e d / i n c a r n a

31 I L L U CITY L A V I L L E TTE > A b o u t k i n t u r n o v e r s i n c e t h e o p e n i n g > G a m e s a c c l a i m e d b y c u s t o m e r s : a s s a s s i n s c r e e d / i n c a r n a E s c a p e g a m e E c l i p s e > N e a r l y 3, p a i d g a m e s p l a y e d i n 3 w e e k s > C o r p o r a t e t u r n o v e r is s t i l l m o d e s t ( 5 k ) b u t s h o u l d i n c r e a s e s i g n i f i c a n t l y i n t h e c o m i n g w e e k s ( m a n y p r i v a t i z a t i o n s a r e s c h e d u l e d f o r t e a m b u i l d i n g ) 31

C O N T I N U ING O U R P E R F O RM P L A N > L a u n c h o f a c o s t - c u t t i n g p l a n i n S e p t e m b e r 2 0 1 8 t h a t w i l l r e d u c e t h e G r o u p ' s f i x e d c o s t s b y

32 C O N T I N U ING O U R P E R F O RM P L A N > L a u n c h o f a c o s t - c u t t i n g p l a n i n S e p t e m b e r t h a t w i l l r e d u c e t h e G r o u p ' s f i x e d c o s t s b y a t l e a s t 5. 0 m i l l i o n o v e r a f u l l y e a r f r o m > P u r s u i n g a d e v e l o p m e n t s t r a t e g y b a s e d o n i n t e r n a t i o n a l i z a t i o n a n d i n n o v a t i o n > C o n t i n u e d d i g i t a l t r a n s f o r m a t i o n o f E c l a i r w i t h a r a p i d d e v e l o p m e n t o f E c l a i r P l a y, E c l a i r T r a c k a n d l a u n c h o f n e w s o l u t i o n s ( E c l a i r S e n d, E c l a i r S c r e e n e r, E c l a i r S t o r e ) a s d i g i t a l c o n t e n t m a n a g e m e n t p l a t f o r m s > F i r s t r e v e n u e s e x p e c t e d f r o m t h e n e w a c t i v i t i e s ( E c l a i r C o l o r, E c l a i r G a m e a n d V i r t u a l R e a l i t y ) 32

P E R F O RM P L A N O B J E C T I VES C O N F I R ME D F O R 2 0 2 0 Perform Plan objectives confirmed: consolidation and innovation to drive development Consolidation Targeted acquisitions

33 P E R F O RM P L A N O B J E C T I VES C O N F I R ME D F O R Perform Plan objectives confirmed: consolidation and innovation to drive development Consolidation Targeted acquisitions Deployment of new offers Digital transformation First revenues from innovations Organic growth Operational profitability Consolidation & Digital Transformation Leadership & Profitability Perform Plan targets: Eclair and CinemaNext CAGR >10% between 2016 and 2020 CinemaNext market share up from 20% to 30% EBT margin >5% by 2020 for each BU 33

Minimum%Wage%Rate,%2004%to%2021:%$/hour%

$14.00%% Minimum%Wage%Rate,%2004%to%2021:%$/hour% $13.00%% $12.00%% $11.00%% $10.00%% $9.00%% $8.00%% $7.00%% $6.00%% 2004% 2005% 2006% 2007% 2008% 2009% Senate Bill 1532 2016/1 $********** 9.25 2016/2