Goldman Sachs Classifieds Field Trip London, September 23, Dr Julian Deutz, CFO Daniel Fard-Yazdani, Co-Head of Investor Relations

Transcription

1 Goldman Sachs Classifieds Field Trip London, September 23, 2015 Dr Julian Deutz, CFO Daniel Fard-Yazdani, Co-Head of Investor Relations

2 Disclaimer This document, which has been issued by Axel Springer SE (the "Company"), comprises the written materials/slides for a presentation of the management. Whilst all reasonable care has been taken to ensure that the information and facts stated herein are accurate and that the opinions and expectations contained herein are fair and reasonable no representation or warranty, express or implied, is given by or on behalf of the Company, any of its directors, or any other person as to the accuracy or completeness of the information or opinions contained in this document and no liability is accepted for any such information or opinions. This document contains forward looking statements which involves risks and uncertainties. These forward looking statements speak only as of the date of this document and are based on numerous assumptions which may or may not prove to be correct. The actual performance and results of the business of the Company could differ materially from the performance and results discussed in this document. The Company undertakes no obligation to publicly update or revise any forward looking statements or other information contained herein whether as a result of new information, future events or otherwise. This document does not constitute or form any part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in the Company, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto. 2

3 Axel Springer at a Glance Highlights Germany s leading publisher with unique media brands Successful transformation with 75% of EBITDA from digital activities Organic growth supported by active M&A with strong track record Strong balance sheet and cashflow High dividend yield Revenues by segment 1) EBITDA by segment 1) 27% Financials 4% 23% 18% -8% 55% 34% 46% 2014 Outlook 2015 Classified Ad Models Paid Models Marketing Models Services / Holding Revenues in m 3,037.9 Low to mid single-digit % growth EBITDA in m High single-digit % growth EBITDA-margin 16.7% EPS (adj.) in 2.01 Low double-digit % growth DPS (FY 2014) in ) Based on H1/15 figures. 3

4 Digital transformation along core areas of expertise 3 Zimmer mit Haus im Grünen, Moderne Altbauwohnung, 75 m², gesucht! 2 gesucht! Ich, 43, wohnung, 75 m², gesucht! 2 Wohnung Mitbewohner Moderne Altbau- Wohnung Finesse, niedrige von privat! Keine Energiekosten Courtage! 030 Beste Lage! Zi.,Kü,Bad. Ab w, suche Mitbewohner, m, der mir Chiffre 0815 sofort! Beste Lage! Zi.,Kü,Bad. Ab dank Solaranlage, Chiffre 0815 sofort! ca 83m² Wfl., im Haushalt hilft Zimmer mit Moderne Altbauwohnung, 75 m², Haus im Grünen, Mitbewohner Finesse, niedrige 3 Zimmer mit 650 Miete + NK Finesse, niedrige Mitbewohner oder mietähnliche Energiekosten gesucht! Ich, 43, Beste Lage! von privat! Keine gesucht! Ich, 43, Energiekosten Kaufraten, Bezug dank Solaranlage, w, suche Mitbewohner, m, der mir Mitbewohner, m, ca 83m² Wfl., Chiffre 0815 Courtage! 030 w, suche dank Solaranlage, sofort ca 83m² Wfl., Miete + NK im Haushalt hilft der mir im 650 Miete + NK Mitbewohner Mitbewohner Wohnung oder mietähnliche Haushalt hilft oder mietähnliche Haus im Grünen, gesucht! Ich, 43, gesucht! Ich, 43, gesucht! 2 Kaufraten, Bezug Kaufraten, Bezug von privat! Keine w, suche Mitbewohner, m, der mir wohner, m, der mir von privat! Keine w, suche Mitbe- Haus im Grünen, Zi.,Kü,Bad. Ab sofort sofort Courtage! 030 sofort! im Haushalt hilft. im Haushalt hilft. Courtage! 030 Moderne Altbauwohnung, 75 m², gesucht! 2 gesucht! Ich, 43, Wohnung jetzt Mitbewohner 3 Zimmer mit Haus im Grünen, Haus im Grünen, Finesse, niedrige von privat! Keine von privat! Keine Moderne Altbauwohnung, 75 m², Beste Lage! Zi.,Kü,Bad. Ab w, suche Mitbewohner, m, der mir Energiekosten Courtage! 030 Courtage! 030 Chiffre 0815 sofort! dank Solaranlage, Beste Lage! im Haushalt hilft. Moderne Altbauwohnung, 75 m², 650 Miete + NK Moderne Altbau- ca 83m² Wfl., Chiffre Zimmer mit Mitbewohner Mitbewohner Finesse, niedrige gesucht! Ich, 43, gesucht! Ich, 43, Beste Lage! oder mietähnliche wohnung, 75 m², Energiekosten w, suche 3 Zimmer mit w, suche Chiffre 0815 Kaufraten, Bezug Beste Lage! dank Solaranlage, Mitbewohner, m, Finesse, niedrige Mitbewohner, m, sofort Chiffre 0815 ca 83m² Wfl., der mir im Energiekosten der mir im Mitbewohner 650 Miete + NK Haushalt hilft. dank Solaranlage, Haushalt hilft. gesucht! Ich, 43, Moderne Altbauwohnung, 75 m², Kaufraten, Bezug 650 Miete + NK von privat! Keine oder mietähnliche ca 83m² Wfl., Haus im Grünen, Wohnung Haus im Grünen, w, suche gesucht! 2 von privat! Keine Mitbewohner, m, Beste Lage! sofort oder mietähnliche Courtage! 030 Zi.,Kü,Bad. Ab Courtage! 030 der mir im Chiffre Kaufraten, Bezug sofort! Haushalt hilft sofort Classified Ad Models Paid Models Marketing Models & For all segments: main activities only. 4

5 Active portfolio management accelerates shift to digital Revenues Advertising Revenues EBITDA 38% 81% 63% 19% 2009 H1/15 20% 70% 80% 30% 2009 H1/15 25% 88% 75% 12% 2009 H1/15 Digital share. (Digital share of EBITDA in H1/15 would be 81% if Services/Holding was fully allocated to non-digital.) Non-digital share. 5

6 Earnings development driven by digitization Revenues in m EBITDA in m H1/14 H1/ H1/14 H1/15 6

7 Margin profile segments: Classified Ad Models with strong margin increase EBITDA margin in % Classified Ad Models Paid Models Marketing Models H1/ H1/ H1/ EBITDA in m H1/ H1/ H1/15 EBITDA EBITDA ex restructuring / launch costs EBITDA margin EBITDA margin ex LC/RC 7

8 Group guidance for the full year confirmed in m H1/15 yoy Q2/15 yoy Revenues 1, % % Advertising % % Circulation % % Other % % EBITDA % % Margin 16.9% # -1.6pp 18.4% # -1.4pp Restructuring Exp # # 1.1 Launch Costs 11.1 # EBITDA ex. Restr./LC % % Margin 19.3% # -1.8pp 20.9% # -1.5pp Digital media driving revenue growth and over-compensating decline in print Revenues in H1/15 up 9.8%, adjusted for consolidation effects +2.6% EBITDA stable yoy mainly due to tough comps in H1/14 EBITDA to grow stronger in H2/15 8

9 Adjusted eps slightly below prior year level in H1 low double-digit growth for FY 15 expected in m H1/15 H1/14 Q2/15 Q2/14 Net income Net income discontinued operations Net income continuing operations Non-recurring effects Effects of purchase price allocations Taxes attributable to these effects Adjusted net income Thereof attributable to non-controlling interests Adjusted net income attributable to shareholders of Axel Springer SE in Adjusted eps continuing operations 1) ) Based on weighted average number of shares outstanding in H1/15: 98.9m. 9

10 Free cash flow up yoy Free cash flow in m Dividend volume in m Dividend ( /share) H1/14 H1/

11 Financial headroom for investments and dividend Financial situation Attractive financing further optimized volume up to 1.2bn (from 900m) and improved margins Net financial debt 1) of 822m and leverage of 1.5x 2) Future cash inflows ~ 480m 257m loans related to sale of assets to FUNKE Media Group 225m sale of stake in Doğan TV (after receipt of 63m in January 2015) Strong free cash flow generation (2014: 244.1m) Planned new legal form enables further mid- and long-term growth Sufficient headroom for investments in digitization and high dividend (payout of 178m for 2014 on April 15, 2015) 1) Excl. pension liabilities 2) Based on Bloomberg EBITDA consensus for FY

12 Clear investment criteria Strategic fit along three areas of expertise Experienced and incentivized management Reasonable valuation Added value through Axel Springer Company transformation supported by digital acquisitions (total of ~ 3.6bn) and divestments (total of ~ 2.6bn) since ) 1) EV before purchase price adjustments, taxes etc. 12

13 Exciting digital initiatives in the Englishspeaking world 13

14 Upday Start of mobile news offering together with Samsung News aggregator providing personalized news exclusively on Samsung smartphones = + Start of beta version in 9/15 in Germany and Poland Full offering and more countries to follow in 2016 Want to know based on user interests (algorithm-based) Need to know curated by journalists 14

15 Priorities going forward 1 Growth in Classifieds 2 Growth in Digital Subs 3 Growth in US/UK 15

16 Outlook 2015 Axel Springer Group Revenues EBITDA eps (adj.) Low to mid single-digit % growth High single-digit % growth Low double-digit % growth Classified Ad Models Paid Models Marketing Models Services/ Holding Revenues Significant increase Low single-digit % decline Mid to high-single digit % growth Significant decline EBITDA Significant increase Low double-digit % decline Low double-digit % decline to significant decline Significant improvement 16

17 Envisaged legal form change to KGaA combines best of both worlds Family controlled business Capital Markets Access 17

18 Our corporate mission The leading digital publisher 18

19 Highlights Classified Ad Models

20 Classified Ad Models segment at a Glance Highlights Portfolio of market leading classified ad models Digital classifieds clear beneficiary of structural shift from print to online Strong market positions yielding high margins 85% ownership and option for remaining 15% Jobs #1 in Germany #1 in UK #1 in Ireland, South Africa Financials Classified Ad Models Real Estate #1 in France #1 in Belgium #2 in Germany & Cars #1/2 in France Local #1 in Germany Generalist #1 in Israel Travel #1 in Netherlands and Belgium 2014 Outlook 2015 Revenues in m Significant increase EBITDA in m Significant increase EBITDA-margin 43.2% 20

21 Deal structure Former GA stake in Axel Springer Digital Classifieds (ASDC) 30% December % Cash payment ( 446m) 15% Issuance of Axel Springer shares (Appraisal report IDW S1) Valuation of ASDC of 3.95bn (100%, cash/debt free) EV/EBITDA multiple x-15x Closed December 8, 2014 Call option for Axel Springer (AS) against shares in AS SE 21

22 GA to become Axel Springer group shareholder Today Axel Springer Post transaction Axel Springer Classified Ad Models Paid Models Marketing Models Classified Ad Models GA share ~8.6% 1) Paid Models Marketing Models GA share 15% 1) Based on Axel Springer share price as of December 5, 2014 ( 47.66) and valuation of first 15% tranche. 22

23 Consolidating German real estate portals: Process update Recent developments February, 2015: Signing April, 2015: Cartel office clearance June, 2015: Closing Currently: Offer to real estate agents in place to advertise on both portals Strong #2 23

24 StepStone: Lead over competitors is widening Company profile #1 job portal in Germany, UK and Belgium High growth driven by operational excellence and market share gains Applications per job ad in Germany; ) Revenue growth and scalability of business resulting in strong margin improvement Competitor x3.2 x2.6 x1.9 Several bolt-on acquisitions enabling knowhow transfer and best practice exchange Competitor x3.5 x3.1 x2.0 Relevance of direct search in Germany limited Competitor x3.6 x4.7 x4.6 Competitor x5.1 x7.1 x7.5 1) Source: TNS Infratest 24

25 SeLoger revenue growth driven by strong ARPA development Company profile #1 specialist real estate portal in France Monthly ARPA depending on regions (EUR) Penetration rate with real estate agents >80% Excellent competitive position and beneficiary from print to online shift Continued revenue growth driven by strong ARPA development over the last ten years Paris area Province Total (excl. verticals) Total (incl. verticals) Note: ARPA figures as of December of each year 25

26 Classified Ad Models with accelerated organic growth in m H1/15 yoy Q2/15 yoy Revenues % % Revenues (pro forma) % % Advertising % % Other % % EBITDA* % % Margin 41.5% # -3.1pp 42.8% # -2.9pp Revenue increase due to strong organic growth (13.3%) in H1/15 and acquisitions EBITDA up significantly, lower margin reflects consolidation effects * Total EBITDA includes costs of 3.1m in H1/15 and 1.7m in H1/14 (thereof business development, M&A and other), not allocated to the three pillars. 26

27 Significant organic revenue growth in jobs vertical Jobs EBITDA share 49% Real estate EBITDA share 34% in m H1/15 yoy Q2/15 yoy Revenues % % Revenues (pro forma) % % EBITDA* % % Margin 43.4% # -3.3pp 44.6% 0-3.7pp in m H1/15 yoy Q2/15 yoy Revenues % % Revenues (pro forma) % % EBITDA* % % General/Other EBITDA share 17% Margin 50.6% # 3.0pp 56.0% 0 7.7pp in m H1/15 yoy Q2/15 yoy Revenues 83.4 >100 % 40.5 >100 % Revenues (pro forma) % % EBITDA* 25.1 >100 % 10.7 >100 % Margin 30.1% # 11.3pp 26.3% 0 5.0pp * Total EBITDA includes costs of 3.1m in H1/15 and 1.7m in H1/14 (thereof business development, M&A and other), not allocated to the three pillars. 27

28 Highlights Paid Models

29 Paid Models segment at a Glance Highlights Focus on market-leading media brands with clear path to digitization National paid models dominated by unique asset BILD WELT group complemented by leading news TV channel N24 Pioneering paid content in Germany with encouraging results National BILD group WELT group/n24 (Main activities) Financials Paid Models International Ringier Axel Springer Media (Poland, Hungary, Serbia, Slovakia) Switzerland (in JV with Ringier*) France, Spain * Signing 09/15, closing pending Strong presence in Eastern Europe (JV with Ringier) 2014 Outlook 2015 Revenues in m 1,561.4 Low single-digit % decline EBITDA in m Low double-digit % decline EBITDA-margin 15.6% 29

30 BILD a unique media brand print and online Print, daily reach in million 1) 20 Online, reach in million unique users 2) bild.de focus.de spiegel.de welt.de ma 09/I ma 09/II ma 10/I ma 10/II ma 11/I ma 11/II ma 12/I ma 12/II ma 13/I ma 13/II ma 14/I ma 14/II ma 15/I ma 15/II BILD vs. TV Bild.de vs. Peers 2) BILD 10.4 Tatort 8.9 WSJ 3.2 Big Bang Theory 22.9 Strictly come dancing The Sun ) ma Pressemedien, Note: change in population parameter after ma 2010 I 2) AGOF UUs (14+) in million per month (not incl. mobile internet). 30

31 BILD reaches 291k digital subscribers Freemium model Introduced 06/2013 Price range: per month Including German soccer league highlight clips August months after start 291k Metered model Introduced 12/2012 Price range: per month German soccer league highlight clips as additional option ( per month) August months after start 68k 31

32 Paid Models impacted by tough prior year comps in m H1/15 yoy Q2/15 yoy Revenues % % thereof digital (reported) % % thereof digital (pro forma) % % Advertising % % Circulation % % Other % % EBITDA % % Margin 12.5% # -5.0pp 13.3% # -5.3pp Restructuring Exp # Launch Costs EBITDA ex. Restr./LC % % Margin 16.2% # -4.2pp 17.1% # -3.9pp Revenue development impacted by consolidation effects, adjusted for these effects down 6.3% in H1/15 Advertising revenues adjusted for consolidation effects down 10.9% in H1/15 and 14.5% in Q2/15 due to prior year world cup comps Increase in other revenues driven by consolidation effects from N24 EBITDA decline due to lower revenues, change in revenue mix and higher restructuring expenses 32

33 Paid Models Subsegments Paid Models National Paid Models International in m H1/15 yoy Q2/15 yoy H1/15 yoy Q2/15 yoy Revenues % % % % thereof digital (reported) % % % % thereof digital (pro forma) % % % % Advertising % % % % Circulation % % % % Other % % % % EBITDA % % % % Margin 12.0% # -7.4pp 12.1% # -8.3pp 13.6% # 2.0pp 16.4% # 3.3pp Restructuring Exp # Launch Costs EBITDA ex. Restr./LC % % % % Margin 16.7% # -6.4pp 16.7% # -6.6pp 14.6% # 2.5pp 18.0% # 4.1pp 33

34 Highlights Marketing Models

35 Marketing Models segment at a Glance Highlights #1 positions in all major marketing business models Reach based marketing with strong organic growth and margin >20% zanox group European market leader in performance marketing Performance marketing with structurally low margin (~5%) Reach Based Marketing Idealo aufeminin Bonial (kaufda/retale) (Main activities) Financials Marketing Models Performance Marketing zanox group Digital Window eprofessional 2014 Outlook 2015 Revenues in m Mid to high single-digit % growth EBITDA in m Low double-digit % decline to significant decline EBITDA-margin 13.8% 35

36 kaufda: Going fast track international Business model 2008: Start in Germany, quickly achieved market leading position Research online buy offline Making use of location-based offerings, also adding push alert functions 2014: Bolt-on acquisition of MeinProspekt Print insert goes digital Cost per Click Internationalization France (since 2011) Spain, Brazil (since 2012) USA (since 2013) US market size for brochures (>15bn USD) exceeds European market Mexico, Chile, Columbia, Sweden, Denmark, and Norway (since 2015) Growth driven by mobile More than 80% of brochure view already coming from mobile: Jan 11 Dec 11 Dec 12 Dec 13 Dec 14 Brochure views Germany and France 36

37 Organic growth continues to drive Marketing Models in m H1/15 yoy Q2/15 yoy Revenues % % Revenues (pro forma) % % Advertising % % Other % % EBITDA* % % Margin 11.4% # -3.5pp 12.6% # -3.3pp Restructuring Exp. 0.4 # Launch Costs Advertising revenue growth driven mostly by performancebased marketing models Increase in other revenues mostly due to TV activities and aufeminin group EBITDA below prior year due to competitive environment and portfolio changes at aufeminin EBITDA ex. Restr./LC % % Margin 12.7% # -4.0pp 13.7% # -4.0pp * Total EBITDA includes costs of 3.7m in H1/15 and 2.2m in H1/14 (thereof business development, M&A and other), not allocated to the two pillars. 37

38 Marketing Models Subsegments Reach Based Marketing Performance Marketing in m H1/15 yoy Q2/15 yoy H1/15 yoy Q2/15 yoy Revenues % % % % Revenues (pro forma) % % % % Advertising 96.0 # 3.9% 50.4 # 7.3% # 13.6% # 12.0% Other 60.7 # 50.8% 27.9 # 36.8% 27.2 # 17.2% 13.9 # 36.3% EBITDA* % % % % Margin 25.9% # -9.2pp 29.6% # -6.6pp 4.4% # -0.2pp 4.0% # -1.0pp Restructuring Exp Launch Costs EBITDA ex. Restr./LC % % % % Margin 29.2% # -10.9pp 32.6% # -8.5pp 4.5% # -0.1pp 4.0% # -1.0pp * Total EBITDA includes costs of 3.7m in H1/15 and 2.2m in H1/14 (thereof business development, M&A and other), not allocated to the two pillars. 38

39 Investor Relations contacts Claudia Thomé Co-Head of Investor Relations Phone: Mobile: Daniel Fard-Yazdani Co-Head of Investor Relations Phone: Mobile: Axel Springer SE: Axel-Springer-Str. 65, Berlin, Germany, Fax: