GRUPO TELEVISA, S.A.B. Investor
Presentation
Fourth Quarter 2019
Televisaat a Glance
CABLE | CONTENT |
A leading cable | Advertising |
operator | Four broadcast channels |
in Mexico | in Mexico City and |
affiliated stations | |
Video | throughout the country |
4.3millon RGUs | Network Subscription |
Broadband | 25 pay-tv networks |
4.7millon RGUs | Licensing & Syndication |
Voice | Univision royalties, other |
licensing fees, and exports | |
3.6millon RGUs | to over 70 countries |
SKY
A leading DTH system in Mexico and broadband provider, also operating in Central America and the Dominican Republic
Video:7.4 millon RGUs
Broadband:386 thousand RGUs
RGUs: Revenue Generating Units. DTH: Direct to Home
2019 Share of Revenue and OSI*
31% | 43% | 39% |
33%OSI* | OSI* | |
Cable |
Content
22%
OSI*
20%
Sky
*Operating segment income (OSI) is defined as operating income before corporate expenses, depreciation and amortization, and other expense, net. For a reconciliation of total operating segment income with consolidated operating income, see Note 25 to our year-end consolidated financial statements.
2
2019Operating Highlights
The transformation of Televisa continued in 2019 with many milestones
CABLE
SKY
CONTENT
- Double digit growth in Revenue and Operating Segment Income
- Reached12.7 millionRevenue Generating Units (RGUs)
- Solid operating metrics withlow churn
- Positioned IZZI as the premieraggregator of OTToffers
- Resumedgrowth in videoRGUs with positive net adds each of the last three quarters
- Continued buildingscale in the broadbandbusiness
- Launched new,innovative formatswith great success
- Reassigned resources and increasedproduction values
- Achieved strongviewership levels
- LaunchedTUDN, asports JV with Univision
3
2019Consolidated Financial Results
Steady Revenue and OSI1growth, declining capital intensity
Revenue
Ps. in billions
101.3 101.5
96.3 94.3
88.1
80.1
OSI1
Ps. in billions
38.9 | 40.3 | 41.0 |
37.5 | ||
35.7 |
32.3
non-recurring licensing of certain rights of the World Cup
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
- Consolidatedrevenue growth of 3.0% andOSI1growth of 5.4%*
- Ongoingfinancial discipline with cost and expensesdeclining by Ps.579 million
- Strong balance sheet: Net Debt to OSI1of 2.3x and averagematurity of 16.9 years
4 | 1Operating segment income (OSI) is defined as operating income before corporate expenses, depreciation and amortization, and other expense. |
*Excludes the non-recurring licensing of certain rights of the World Cup |
4Q'19Consolidated Financial Results
Fastest pace of growth in Operating Segment Income (OSI1) in five quarters
Revenue | OSI1 | ||||||||||||||||||||||||||||||||||
Ps. in billions | Ps. in billions | ||||||||||||||||||||||||||||||||||
27.3 | 28.0 | ||||||||||||||||||||||||||||||||||
26.7 | |||||||||||||||||||||||||||||||||||
24.0 | 25.0 | 26.0 | |||||||||||||||||||||||||||||||||
10.9 | 10.4 | 11.1 | |||||||||||||||||||||||||||||||||
9.9 | 9.9 | 10.2 | |||||||||||||||||||||||||||||||||
4Q'14 4Q'15 4Q'16 4Q'17 4Q´18 4Q´19 | 4Q'14 4Q'15 4Q'16 4Q'17 4Q´18 4Q´19 |
- Revenue and OSI1growth of 4.7%and 6.6%,respectively
- Stabilization ofad salesduring the quarter, and US$101 millionin Univision royalties
- Cable added115 thd. RGUs, a sequential improvement vs 3Q'19
- Sky added67 thd. broadband RGUs and17 thd. video RGUs
5
1Operating segment income (OSI) is defined as operating income before corporate expenses, depreciation and amortization, and other expense.
Cable:12.7 million customer relationships
Broadband and voice continue to be the main drivers of growth
Total RGUs
Millions
12.7
11.8
9.7 10.1
9.0
6.9
2014 2015 2016 2017 2018 2019
RGU Mix
18%
29%
33%
37%
49%
34%
2014 2015 2016 2017 2018 2019
- Added811 thd. RGUs
- Broadbandmarket share reached24.4%
- Byyear-end, reached 15.3 millionhomes passed
- A telecom network of140 thd. kilometers, 32% is fiber
Video | Data | Voice | Video | Data | Voice | |||||
6
Cable:Continues to grow at a steady pace
After heavy investments in infrastructure, Operating Cash Flow (OCF2) keeps expanding
Revenue | OSI1 | OCF2 | ||
Ps. in billions | Ps. In billions | Ps. in billions | ||
41.7 | 5.3 | |||
17.8 | ||||
36.2 | 3.9 | |||
15.3 | ||||
33.0 | 3.0 | |||
31.9 | 14.0 | |||
28.5 | 13.2 | |||
11.4 |
20.9
7.9
-1.4
-4.8
-4.3
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2014 2015 2016 2017 2018 2019 |
- In 2019,double digit growthin Revenue and in OSI1of 15.1%and 16.3%,respectively
- Organically, excluding Axtel acquisition in December 2018, OSI1expanded by 11.4%
- Operating Cash Flow (OCF2) reached Ps.5.3 billion, ay-o-ygrowth of 76.6%
7 | 1Operating segment income (OSI) is defined as operating income before corporate expenses, depreciation and amortization, and other expense. |
2Operating Cash Flow (OCF) is defined as Operating Segment Income minus capital expenditures in properties, plant and equipment |
Cable:2020 Goals
With our extensive infrastructure, we will continue to focus on:
CABLE
- Growing ourshare of broadbandfurther
- Resuminggrowth in videosubscribers
- Strengthening position asaggregator of OTToffers
- ExpandingOperating Cash Flow1
8
1Operating Cash Flow is defined as Operating Segment Income minus capital expenditures in properties, plant and equipment.
Sky:Over 7 million customers
Broadband has become an attractive ad-on to many pay TV households
Total | Broadband |
RGUs | RGUs |
Millions | Thousands | 386 |
- Byyear-end 2019, over
8.0 | 8.0 | 7.7 | 319 |
7.8 |
7.3
6.6
238
165
92
7.8 million combinedvideo andbroadband RGUs
- Added294 thousand broadband RGUs during the year
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 4Q´18 | 1Q´19 | 2Q´19 | 3Q´19 | 4Q´19 |
9
Sky:Transforming it into a telecom operator
Pressure in margins has been necessary to build scale in broadband
Revenue | OSI1 | OCF2 | ||||
Ps. in billions | Ps. in billions | Ps. in billions | ||||
21.9 | 22.2 | 22.0 | 21.3 | |||
19.3 | 9.9 | 10.1 | 9.8 | |||
17.5 | 6.3 | |||||
9.0 | 9.1 | |||||
5.9 | ||||||
8.2 | 5.3 | |||||
3.5 | 3.7 |
3.1 |
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2014 2015 2016 2017 2018 2019 |
- Operating Cash Flow (OCF2) reached Ps.5.3 billion
- Capital expenditureshave been strong to support foray into broadband
10 | 1Operating segment income (OSI) is defined as operating income before corporate expenses, depreciation and amortization, and other expense. |
2Operating Cash Flow (OCF) is defined as Operating Segment Income minus capital expenditures in properties, plant and equipment |
Sky:2020 Goals
With its more than 7 million pay-tv customers, Sky will continue to build a telecom presence:
SKY
- Offeringattractive bundles
- Launching packages withfaster speeds
- Targetingnew marketswithin its footprint
- Launchingnew broadband services
11
Content Division:An unmatched audience reach
We produce the content that people choose to watch on broadcast TV
Network | Program | Ratings | % of |
(mm) | Pop. | ||
Televisa | ¿Quien es la mascara? | 8,219 | 6.5% |
Televisa | Silvia Pinal frente a ti | 7,484 | 5.9% |
Televisa | Mi marido tiene más familia | 7,195 | 5.7% |
Televisa | La Voz Kids | 6,810 | 5.4% |
Televisa | Amar a muerte | 6,273 | 5.0% |
Televisa | La Rosa de Guadalupe | 6,253 | 4.9% |
Televisa | La Usurpadora | 6,225 | 4.9% |
Televisa | Una Familia de Diez 3 | 6,085 | 4.8% |
Televisa | Una Familia de Diez 2 | 6,055 | 4.8% |
Televisa | Pequeños Gigantes | 5,900 | 4.7% |
Network | Program | Ratings | % of |
(mm) | Pop. | ||
CBS | Big Bang Theory | 13,381 | 4.1% |
CBS | NCIS | 12,663 | 3.8% |
NBC | This Is Us | 12,502 | 3.8% |
NBC | Agt Champions | 12,394 | 3.8% |
NBC | America's Got Talent | 11,666 | 3.5% |
NBC | Chicago Fire | 11,536 | 3.5% |
NBC | Chicago Med | 11,174 | 3.4% |
NBC | Chicago Pd | 11,061 | 3.4% |
NBC | Manifest | 10,913 | 3.3% |
FOX | Masked Singer | 10,676 | 3.2% |
- Broadcast is akey form of entertainmentin Mexico, above the U.S. as a % of population
- In 2019, thetop 10 programsin Mexico's broadcast TV were produced and transmitted by us
- These included threecomedies,three game shows, three dramas,and one bio-epic
- Our top production reached60% more viewers* than the top production in the U.S. in 2019
12Source for Mexico: National projection based on Nielsen IBOPE's audience measurement of the 28 largest cities of Mexico. Sports not included in ranking. *As a percentage of total population. Source for US: Nielsen US national sample.
Content:Multiple windows to choose from
Televisa is a relevant participant in every platform
Four Broadcast
Networks in Mexico
Exports
(70+ countries)
25 Pay TV
Networks
OTT &
Digital
- We are in theunique positionto choose how and where we monetize our content
- Broadcast Television continues to bethe most effectiveway to do so
- We are expanding our expertise inDigital and OTTand gradually building scale
13
Content Division:A production powerhouse
After a multi-year restructuring phase, business is stabilizing
Revenue | OSI1 | OCF2 | |||||||||||||||||||||||||||||||
Ps. in billions | Ps. in billions | Ps. in billions | |||||||||||||||||||||||||||||||
39.23 | |||||||||||||||||||||||||||||||||
34.9 | 36.7 | ||||||||||||||||||||||||||||||||
34.3 | 34.0 | 34.8 | 13.1 | ||||||||||||||||||||||||||||||
15.5 | 12.1 | 11.9 | 13.13 | ||||||||||||||||||||||||||||||
14.7 | 14.93 | 10.8 | 10.6 | ||||||||||||||||||||||||||||||
14.6 | |||||||||||||||||||||||||||||||||
12.8 | 12.6 | ||||||||||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 |
- In 2019, revenue was down4.6%mainly due to drop in government advertising
- Core private sector ad revenuewas down 1.8% due to macro uncertainty in 1H'19
- Strong performance of our content in Univision resulted inU.S.$389.1 millionin Royalties
- Operating Cash Flow (OCF2,4) was approximately in line with 2018
1Operating segment income (OSI) is defined as operating income before corporate expenses, depreciation and amortization, and other expense.
142Operating Cash Flow (OCF) is defined as Operating Segment Income minus capital expenditures in properties, plant and equipment 3Includes the non-recurring licensing of certain rights of the World Cup in Latin America in 2018
4Excluding the 2018 World Cup licensing revenue and the 2019 drop in government advertising
Content:2020 Goals
Televisa will continue to focus on strengthening its content business
CONTENT
- Increasing thevolume and qualityof our original content
- Ongoinginnovationin our formats and storylines
- Striving for strong ratings acrossall genres
- Expanding the ways in which wemonetize our content
15
StrongBalance Sheet
Weighted average
maturity:
USD is 20.6years
Ps is 8.9years
dollar-denominated costs and expenses
US$750 million*
dollar-denominated revenue
US$933 million*
*Full Year 2018
Closest USD maturity | Closest peso maturity | |
US$600 | Ps.10,000 | |
million | million | |
in | in | |
2025 | 2024 | |
66%of debt in USD
34%of debt in Ps
Net debt to
OSI ratio:
2.3 times
As of FY 2019, except otherwise | ||
16 | *Full Year 2018 | indicated |
Sustainability:A key component in our strategy
Our many sustainability efforts continue to be recognized around the world
2020 FTSE4Good Emerging Index
2020 FTSE4Good Emerging Latin America Index
2020 FTSE4Good BIVA Index
2020 BloombergGender-Equality Index 1
2020 BMV/S&P IPC Sustentable (Sustainability Index)
2019 Dow Jones Sustainability Emerging MarketsIndex 2
2019 Dow Jones Sustainability MILA Pacific AllianceIndex
2019 United Nations (UN) Global Compact3
2019Environmental Quality Certificate4
2019 Recertified with Norm ISO 14001:20155
2019Socially Responsible Company Award6
17 | 1. One of only five Mexican companies. 2. One of only three Mexican companies. 3. The world's largest corporate sustainability initiative. 4. Issued by federal |
environmental entity for certain of our facilities. 5. Issued by a third party verification unit. 6. Recognized for the second time for our social responsibility programs. |
Televisa:A strong foundation
Focused on building shareholder value
Fully integratedmedia andtelecommunications
Unique market presencein its core businesses
Diversified revenue base
Growingcash flow
Mexico's second largesttelecom network
Largest producerof Spanish-language content
Long standing commitment to sustainability
Investment grade
One of the most liquidMexican companies
Publicly tradedin NYSE since '93 andin Mexico since '91
Our priorities:
Innovationacross all our
operations
Constant
transformation of our
business model
Long term strategic
positioning
Focus on Cash Flow
generation
18
Disclaimer
This presentation contains forward-looking statements regarding the Company's results and prospects. Actual results could differ materially from these statements. The forward- looking statements in this press release should be read in conjunction with the factors described in "Item 3. Key Information - Forward-Looking Statements" in the Company's Annual Report on Form 20-F, which, among others, could cause actual results to differ materially from those contained In forward-looking statements made in this press release and in oral statements made by authorized officers of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. This presentation may also contain non-IFRS financial measures. Please see description of these non-IFRS financial measures in this presentation and in the Company's press release dated February 20, 2020, announcing the Company's fourth quarter and full year 2019 results.
Investor Relations
www.televisair.com
+ (52) 55 5261 2445
Av. Vasco de Quiroga 2000, A4.
Col. Santa Fe
19CP. 01210 Mexico City
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Grupo Televisa SAB published this content on 20 February 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 February 2020 08:36:09 UTC
