Upload
others
View
4
Download
0
Embed Size (px)
Citation preview
ABS-CBN Corporation Sgt. Esguerra Avenue, Quezon City, Philippines
14 May 2012 Philippine Stock Exchange, Inc. Attn: Ms. Janet A. Encarnacion
Head, Disclosure Department 3rd Floor, Philippine Stock Exchange Plaza Ayala Triangle, Ayala Avenue, Makati City
Securities and Exchange Commission Attn: Director Justina F. Callangan Corporate Finance Department SEC Building, EDSA, Mandaluyong City Subject: 1Q 2012 Analysts’ and Press Briefing Gentlemen / Ladies: We are providing you the materials that we are presenting in our briefing today. Thank you. Very truly yours, Paul Michael V. Villanueva Compliance Officer for Corporate Governance
MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FOR THE QUARTER ENDED MARCH 31, 2012
For the quarter ended March 31, 2012, ABS-CBN Corporation (“ABS-CBN” or the “Company”) generated
consolidated revenues of P7.1 billion from advertising and consumer sales, P556 million or 8% higher year-
on-year. Advertising revenues contributed 59% of total consolidated revenues while consumer sales made
up the balance of 41%.
Total operating and other expense in the first quarter of 2012 was at P6.1 billion, or a 27% increase year-on-
year.
The company generated a net income of P306 million for the first quarter of 2012, down by 69% compared
with P976 million in the same period last year. Removing the effects of the one-time gain from the sale of Sky
Cable PDRs recognized in the first quarter of 2011 amounting to P674 million, net income increased by 1%.
Reported EBITDA reached P1.4 billion for the first quarter of 2012, or a 35% decline year-on-year. Stripping
the one-time gain in the first quarter of 2011, EBITDA was up 1% year-on-year.
The table below summarizes the key performance indicators for the period as discussed above.
Key Performance Indicators
(Amounts in million Pesos) 1Q12 1Q11
Variance
Amount %
Consolidated Revenues 7,149 6,593 556 8
Consolidated Advertising Revenues 4,186 4,011 175 4
Consolidated Consumer Sales 2,963 2,582 381
15
Operating and Other Expenses 6,075 4,776 1,299 27
Net Income 306 976 (670) (69)
EBITDA 1,362 2,098 (736) (35)
Consolidated Revenues
For the three months ended March 31, 2012, ABS-CBN generated consolidated revenues of P7.1 billion from
advertising revenues and consumer sales, P556 million or 8% higher year-on-year.
The contribution of consumer sales to total revenues is higher at 41% from 39% a year ago.
Consolidated Revenues
(Amounts in million Pesos) 1Q12 1Q11
Variance
Amount %
Consolidated Advertising Revenues 4,186 4,011 175 4
Consumer Sales
Sale of Services 2,863 2,470 393 16
Sale of Goods 100 112 (12) (11)
Consolidated Consumer Sales 2,963 2,582 381 15
Consolidated Revenues 7,149 6,593 556 8
Advertising Revenues
Consolidated advertising revenues across all platforms and subsidiaries increased by 4% to P4.2 billion.
ABS-CBN maintained its national audience share and ratings leadership with prime-time audience share
averaging 42% in the first quarter of 2012, with a 12 percentage point lead over GMA’s, based on the Kantar
National TV Ratings.
For the first three months of 2012, 17 of the company’s shows were in the Top 20, with the following
occupying the Top 10 slots: Walang Hanggan, Ikaw ay Pag-ibig, Budoy, My Binondo Girl, Dahil sa Pag-ibig,
Eboy,Maalaala Mo Kaya…, TV Patrol (Weekday), Nasaan Ka Elisa, Wansapanataym, Junior Master Chef Pinoy
Edition (Saturday) and Rated K Handa Na Ba Kayo?
Consumer Sales
Consumer sales for the first quarter of 2012 amounted to almost P3.0 billion, or a 15% increase year-on-
year. The increase is largely attributable to Sky Cable’s growth in revenues which grew by 12%. The
increase in sales of other subsidiaries is partly attributable to the growth in sales of ABS-CBN Film
Productions in the first quarter of 2012.
Consumer Sales 1Q12 1Q11
Variance
(Amounts in million Pesos) Amount %
ABS-CBN Global 1,194 1,159 35 3
Sky Cable 1,152 1,031 121 12
Other subsidiaries 617 392 225 58
Consolidated Consumer Sales 2,963 2,582 381 15
Sky Cable’s consolidated revenues for the year from cable TV and broadband services grew 12% year-on-
year, driven by a 9% growth in postpaid revenues and a 31% growth in broadband revenues. Broadband
service subscriptions increased 20% year-on-year, while subscriptions to Sky Cable’s post-paid TV offering
grew by 10%.
ABS-CBN Global’s revenues increased year-on-year by 3% in peso terms or 5% in US dollar terms. The lower
rate of increase in peso terms was due to a 2% or P0.91 appreciation of the Philippine peso exchange rate
against the US dollar, from P43.79 in 2011 to P42.88 in 2012.
ABS-CBN Global’s overall viewer count was an estimated 2.5 million at the end of March 2012, 3% more
compared to the previous year. Double digit growth in subscribers continued to be experienced in Canada,
and single digit growth in all other territories except Japan and Europe where subscribers declined.
ABS-CBN Film Productions, Inc. released 5 films in the first three months of 2012. Three of them–Enteng ng
Ina Mo, Segunda Mano and Unofficially Yours–topped P100 million in box office receipts, earning blockbuster
status by local standards.
Operating and Other Expenses
Total operating and other expenses in the first quarter of 2012 was at P6.1 billion, or a 27% increase year-
on-year. Removing the effects of the one-time gain on the sale of Sky Cable PDRs which was an Other Income
item in the first quarter of 2011, operating and other expenses would have increased by only 10%.
Total Operating and Other Expenses 1Q12 1Q11
Variance
(Amounts in million Pesos) Amount %
Production Costs 2,477 2,257 220 10
Cost of Sales and Services 1,781 1,587 194 12
General and Administrative Expenses 1,825 1,587 238 15
Other Expenses (Income) (8) (655) 647 99
Consolidated Total Operating and Other Expenses 6,075 4,776 1,299 27
Production Costs
Total production costs rose by P220 million or 10% to P2.5 billion in the first quarter of 2012 compared with
the same period in 2011. Cash production costs went up by P200 million or 11% year-on-year, mostly from
increases from talent fee adjustments, and from new programs that brought talent fees, equipment rentals
and service fees, and other expenses substantially higher.
Production Costs 1Q12 1Q11
Variance
(Amounts in million Pesos) Amount %
Personnel Expenses and Talent Fees 1,252 1,073 179 17
Facilities-Related Expenses 559 525 34 6
Other Program Expenses 278 291 (13) (5)
Sub-total: Cash Production Costs 2,089 1,889 200 11
Non-Cash Production Costs 388 368 20 5
Consolidated Production Costs 2,477 2,257 220 10
Non-cash production costs went up by 6% to P388 million, due to higher depreciation costs and amortization
of program rights.
Cost of Sales and Services
Cost of sales and services increased by 12% or P195 million to P1.8 billion.
ABS-CBN Global’s cost of sales and services increased 7% due to higher marketing expenses. Sky Cable’s cost
of sales and services also grew by 10% year-on-year although slower than its 12% growth in gross revenue.
The increase in cost of sales and services of other subsidiaries is partly attributable to the increase in costs of
ABS-CBN Films.
Cost of Sales and Services 1Q12 1Q11
Variance
(Amounts in million Pesos) Amount %
ABS-CBN Global 552 516 36 7
Sky Cable 783 709 74 10
Other Subsidiaries 446 362 84 23
Consolidated Cost of Sales and Services 1,781 1,587 194 12
General and Administrative Expenses
Total General and Administrative Expenses (GAEX) posted a 15% or P238 million year-on-year increase to
P1.8 billion.
General and Administrative Expenses 1Q12 1Q11
Variance
(Amounts in million Pesos) Amount %
Personnel Expenses 956 808 148 18
Contracted Services 186 183 3 1
Facilities-Related Expenses 185 114 71 61
Depreciation and amortization 166 156 10 7
Provision for Doubtful Accounts 39 46 (7) (14)
Other Expenses 293 280 13 5
Consolidated GAEX 1,825 1,587 238 15
Cash GAEX went up by 16% or P228 million to P1.7 billion, of which more than half is accounted for by
personnel expenses.
Net Income
The company generated a net income of P306 million for the first quarter of 2012, down by 69% compared
with P976 million in the same period last year. Removing the effects of the one-time gain from the sale of Sky
Cable PDRs recognized in the first quarter of 2011 amounting to P674 million, net income would have been
up by 1%.
EBITDA
Earnings before interest, taxes, depreciation and amortization (EBITDA) for the three months ended March
31, 2012 was at P1.4 billion, or a 35% decline year-on-year. Stripping the one-time gain in 2011, EBITDA
increased by 1% year-on-year.
Capital Expenditures
Capital expenditures and program rights acquisitions for the first quarter of 2012 amounted to P1.1 billion,
P190 million or 22% higher than last year’s P875 million.
Balance Sheet Accounts
As at March 31, 2012, total consolidated assets stood at P46.4 billion, P1.6 billion or 4% higher than total
assets of P44.8 billion as at December 31, 2011.
Cash and cash equivalents of P8.0 billion is P588 million or 7% lower than the December 31, 2011 balance.
Consolidated trade and other receivables stood at P8.3 billion, P171 million or 2% higher than as at the end of
2011.
Days sales outstanding of 76 days is 7 days less than the 83 days as at December 31, 2011. Trade accounts
receivables amounting to P6.0 billion is P466 million or 8% higher than the P5.6 billion trade accounts
receivables at the end of 2011.
Total interest-bearing loans was almost flat at P12.5 billion.
Shareholders’ equity stood at P20.5 billion, 1% higher compared with the Shareholder’s equity at the end of
2011.
The company’s net debt-to-equity ratio was higher at 0.22x compared with 0.19x at the end of 2011.
The company’s debt ratios remain well within the limits prescribed under its loan covenants.
PRESS RELEASE
Release Date : FOR IMMEDIATE RELEASE Reference : Paul Michael Villanueva, Head, Treasury and Compliance Officer
Tel : 415.2272 local 4322 Email : [email protected]
ABS-CBN’s recurring net income up by 1% for the first quarter Quezon City, Philippines (May 14, 2012) – The consolidated net income of ABS-CBN Corporation (“ABS-CBN” or the “Company”) (PSE: ABS, ABSP), the country’s largest multimedia conglomerate, registered P306 million for the first quarter of 2012, down by 69% compared with P976 million in the same period last year. Removing the effects of the gain from the sale of Sky Cable PDRs recognized in the first quarter of 2011 amounting to P674 million, net income would have increased by 1%. ABS-CBN generated consolidated revenues of P7.1 billion from advertising and consumer sales for the first three months, an 8% increase compared to the same period last year. ABS-CBN’s advertising revenues reached P4.2 billion in the first three months of the year, an
increase of 4% from a year ago. Consumer sales for the quarter amounted to almost P3.0
billion, posting a 15% increase from a year ago. Sky Cable continues to contribute positively
with revenues increasing by 12% to P1.2 billion. This is mostly driven by the increased take up
of its broadband service subscriptions which increased by 20% year-on-year. ABS-CBN Global
revenues likewise increased by 3% year on year on the back of a 3% increase in overall viewer
count compared to the previous year. There was double-digit subscriber growth in Canada
and single digit growth in all other territories, except Japan and Europe where subscribers
declined.
Total operating and other expenses increased by 10% year-on-year to P6.1 billion brought
about by increases in production costs, cost of sales and services , and general and
administrative expenses.
As a result of the foregoing, net income attributable to shareholders for the first quarter of the year is at P306 million, 69% lower than last year’s net income of P976 million, but 1% higher than last year’s recurring income of P302 million.
Capital expenditure and film and program rights acquisition for the quarter amounted to P1.1 billion, 22% higher than the level of spending for the same period last year. ABS-CBN maintained its national audience share and ratings leadership with prime-time
audience share averaging 42% in the first quarter of 2012, with a 12 percentage point lead over
GMA’s, based on the Kantar National TV Ratings.
For the first three months of 2012, 17 of the company’s shows were in the Top 20, with the
following occupying the Top 10 slots: Walang Hanggan, Ikaw ay Pag-ibig, Budoy, My Binondo
Girl, Dahil sa Pag-ibig, Eboy,Maalaala Mo Kaya…, TV Patrol (Weekday), Nasaan Ka Elisa,
Wansapanataym, Junior Master Chef Pinoy Edition (Saturday) and Rated K Handa Na Ba Kayo?
ABS-CBN Film Productions, Inc. released five films in the first quarter of 2012. Three of them–
Enteng ng Ina Mo, Segunda Mano and Unofficially Yours–topped P100 million in box office
receipts, earning blockbuster status by local standards.
--- About ABS-CBN Corporation ABS-CBN Corporation is the leading Philippine entertainment and information multimedia conglomerate. In the Philippines, ABS-CBN produces a wide variety of engaging world-class entertainment programs in several genres and balanced credible news programs that are aired on free-to-air TV via Channels 2 (VHF) and 23 (UHF) and a regional network of TV and radio stations nationwide. It also provides news and entertainment programming for nine channels on cable TV. The Company owns the leading film and music production and distribution outfit in the Philippines, and has interests in cable TV, Internet and mobile services, and glossy-magazine publishing. It brings its content to worldwide audiences via cable, satellite and the Internet, primarily through ABS-CBN Global’s The Filipino Channel (TFC).
First Quarter 2012 Financial & Operating Results
The Chronicle Lounge 14/F Eugenio Lopez Jr. Communications Center
Eugenio Lopez Ave., Q.C. 14 May 2012
1
Php7.1 billion 1Q 2012 Consolidated Gross Revenue
8% year-on-year
Consolidated Gross Revenues
Ad Revenues
59%
Consumer Sales41%
o
2
Consolidated Advertising Revenues in Php Millions
4% YoY
0
1,000
2,000
3,000
4,000
5,000
1Q2011 1Q2012
4,011 4,186
3
35
42
35
30
1312
3 3
ABS-CBN GMA TV 5 Studio 23
National Ratings – Total Philippines
4
Total Day Audience Share Evening Primetime Audience Share
Kantar Media/TNS National Urban Philippines TV Audience Shares
(1Q 2012)
Kantar Media/TNS National Urban Philippines’ Top Programs
Top 20 Programs
5
17 of ABS-CBN Programs are in the Top 20
Rank Channel Title Rtg%
1 ABS-CBN WALANG HANGGAN 31.5
2 ABS-CBN IKAW AY PAG-IBIG 29.4
3 ABS-CBN BUDOY 28.3
4 ABS-CBN MY BINONDO GIRL 28.2
5 ABS-CBN DAHIL SA PAG-IBIG 27.8
6 ABS-CBN EBOY 27.6
7 ABS-CBN MAALAALA MO KAYA... 27.1
8 ABS-CBN TV PATROL (WEEKDAY) 25.9
9 ABS-CBN NASAAN KA, ELISA? 24.4
ABS-CBN WANSAPANATAYM 21.9
ABS-CBN JUNIOR MASTER CHEF PINOY EDITION (SATURDAY) 21.9
ABS-CBN RATED K HANDA NA BA KAYO? 21.9
11 GMA AMAYA 21.8
12 GMA KAPUSO MOVIE NIGHT 21.5
13 ABS-CBN SARAH G LIVE 21.4
14 GMA EAT... BULAGA! 20.7
15 GMA MUNTING HEREDERA 20.4
16 GMA KAPUSO MO, JESSICA SOHO 20.0
GMA 24 ORAS (WEEKDAY) 19.1
ABS-CBN JUNIOR MASTER CHEF PINOY EDITION (SUNDAY) 19.1
ABS-CBN KAPAMILYA DEAL OR NO DEAL 19.0
GMA PEPITO MANALOTO REALITY SITCOM 19.0
19 ABS-CBN MARIA LA DEL BARRIO 18.8
20 ABS-CBN GOIN' BULILIT 18.6
1ST QUARTER 2012
17
18
10
Consumer Sales in Php Millions
15% YoY
0
1,000
2,000
3,000
4,000
1Q2011 1Q2012
2,582 2,963
6
Consumer Sales
7
0
500
1,000
1,500
2,000
2,500
3,000
3,500
Total ConsumerSales
ABS-CBN Global SkyCable Other Subs
2,582
1,1591,031
392
2,963
1,194 1,152
617
1Q2011 1Q2012
in Php Millions
15% YoY
3% YoY 12% YoY
58% YoY
ABS-CBN Global
8
~ 2.5 million viewers worldwide, 3% more than in 1Q 2011
• Continued growth in Canada, Asia Pacific,Australia, Middle East and North America
• Decline in subscriber count in Europe and Japan
Sky Cable
Strong revenue growth, up 12% YoY
• 31% YoY increase in broadband revenue on the back of 20% YoY growth in subscriptions
• 10% YoY growth in post-paid cable subscriptions driven by the lower end Php 280 and Php 499 packages
9
ABS-CBN Film Productions
3 of 5 films released in 1Q
2012 broke past the
Php 100 million mark in gross
box office receipts
10
• Enteng ng Ina Mo
• Segunda Mano
• Unofficially Yours
-1,000
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
TOTAL Prod Cost COSS GAEX Others
5,525
2,257
1,587 1,587
94
6,075
2,477
1,782 1,825
-9
1Q2011 1Q2012
11
Operating & Other Expenses in Php Millions
10% YoY
10% YoY 12% YoY 15% YoY
109% YoY
*
*
*Without the one-time gain on sale of Sky
Cable PDRs
0
500
1,000
1,500
2,000
2,500
3,000
Production Cost Cash Non-cash
2,257
1,889
368
2,477
2,089
388
1Q2011 1Q2012
12
Production Cost in Php Millions
10% YoY
11% YoY
5% YoY
0
500
1,000
1,500
2,000
Total Cost ofSales andServices
ABS-CBN Global SkyCable Other Subs
1,587
516709
362
1,782
552
783
446
1Q2011 1Q2012
13
Cost of Sales and Services in Php Millions
12% YoY
7% YoY
23% YoY
10% YoY
0
500
1,000
1,500
2,000
General &Administrative
Expenses
Cash Non-Cash
1,5871,431
156
1,8251,659
166
1Q2011 1Q201214
General & Administrative Expenses in Php Millions
15% YoY
7% YoY
16% YoY
Consolidated Net Income in Php Millions
69% YoY
15
0
200
400
600
800
1,000
1Q2011 1Q2012
302 306
674
Gain from sale
of Sky Cable
PDRs
976
Reported Income
1% YoY Recurring Income
Consolidated EBITDA in Php Millions
35% YoY
16
0
500
1,000
1,500
2,000
2,500
1Q2011 1Q2012
1,349 1,362
749Gain from sale
of Sky Cable
PDRs
2,098
Reported EBITDA
1% YoY Recurring EBITDA
Capital Expenditure & Film Rights in Php Millions
0
500
1,000
1,500
2,000
1Q2011 1Q2012
875 1,065
17
22% YoY
Balance Sheet Accounts End March 31, 2012 vs. December 31, 2011
Total Assets Cash and Cash Equivalents Consolidated Trade & Other Receivables Day’s Sales Outstanding Total Interest Bearing Debt Shareholders’ Equity Net Debt-to-Equity Ratio
Php 46.4B Php8.0B Php8.3B 76 days Php12.5B Php20.5B 0.22x
4% 7% 2% 7 days unchanged 1% 0.03x
Significant Event
On May 11, 2012 , Asset Purchase Agreements were signed by Sky Cable Corporation (SKY) with:
– Destiny Cable Inc. (DCI)
– Solid Broadband Corporation (SBC)
– Uni-Cable TV, Inc. (UNI)
which would entail the sale of cable TV and broadband internet assets and subscribers of DCI, SBC and UNI to SKY.
19
20