Slide 1. Fox Kids Europe N.V. FY03 Financial Results December 11, 2003

Transcription

1 Slide 1 TM Fox Kids Europe N.V. FY03 Financial Results December 11, 2003

2 Slide 2 Operating Review Bruce Steinberg Chairman & CEO

3 Slide 3 FY 03 Operating Highlights Integration process with Disney accelerated Subscribers up by 2.5 mil to 34.8 mil. Branded blocks reach an additional 70 million homes New programme distribution output deals concluded or extended Library expanded with acquisition of 205 new episodes Strong return to profitability Solid financial position

4 Disney Integration process accelerated Slide 4 Disney Consumer Products now representing Power Rangers Distribution agreement concluded with Buena Vista Home Entertainment for DVD and video Increasing Disney advertising spend with FKE First co-production with Disney for a new series on the hit publishing property W.I.T.C.H. Complementary nature of channels allows for further synergies

5 Fox Kids and Disney Channels are complementary in Europe Slide 5 Premium channel Not supported by advertising Programming focus on children/families Basic channel Advertising supported Programming focus on boys/action

6 Slide 6

7 Channels & Online Core business performs strongly Slide 7 Subscribers up by 2.5 million y-o-y to 34.8 million Key distribution agreements extended (Denmark, Turkey and The Middle East) New morning branded block launched and afternoon block extended in Italy Channel hours extended in France, The Netherlands and Poland Fox Kids Play successfully relaunched in the UK with Telewest Registered users on Fox Kids websites up by 32% to 1.6 million Now broadcasting in 57 countries in 17 languages via 13 channel feeds

8 Market Positioning Europe & Middle East Slide Sept 30, 2003 TV Households (Million) Disney * Nickelodeon Cartoon Network Fox Kids Source: Market research and FKE estimates *Available as a premium channel

9 Channel Growth Continues Increasing in both cable and DTH Slide 9 40 Million HH s **CAGR = 44% * Cable DTH As of May 31 *As of June 30 + as of September 30 ** CAGR is calculated on 6.33 years

10 Fox Kids Channel Reach Italy leads the growth Slide 10 Greece Israel Hung/Czech/Slov Italy Germany Spain Scandinavia Poland France CEE Netherlands UK & Ireland Sep-02 Sep Million HH s Local channel in every major market

11 Programme Distribution Slide 11

12 Slide 12 Programme Distribution 205 new episodes added New 3-year output deal concluded with Super RTL in Germany including 2 coproductions Output deal extended with Antena 3 in Spain Power Rangers ranked number one in all countries in which it aired in its timeslot Continue to capitalise on the new Marvel feature films: Release Year Title X-Men 2, The Hulk Spiderman 2, Fantastic Four Silver Surfer, Iron Man Focus on reducing programming expenditure per series Growth expected to resume in FY05

13 Slide 13 Growing Programme Library 205 new episodes added Titles delivered include: Gadget and the Gadgetinis RoboRoach Pig City Quintuplets Power Rangers Ninja Storm 180 episodes in progress as at September 30, 2003 Titles in progress include: Sonic X Shaman King Tofu Family RoboRoach 2 What s with Andy 2

14 Slide 14

15 Consumer Products Identifying new ways to improve profitability Slide 15 3-year agency agreement concluded with Disney Consumer Products to represent Power Rangers Substantial improvement in home entertainment activity; 60% increase in units shipped 3-year distribution agreement concluded with Buena Vista Home Entertainment covering Power Rangers, Marvel and Disney funded properties for DVD and video Channel network leveraged to generate new revenue streams such as the band Ch!pz Agency licensing rights to PUCCA secured for all territories in Europe and the Middle East German operations restructured to increase efficiency

16 Slide 16 Financial Review Martin Weigold Chief Financial Officer

17 Fiscal Period Slide 17 Fiscal period end (FPE) prior to IPO was May 31 FPE changed immediately following IPO to June 30 to be coterminous with parent company (then FFWW) for FY01; 13 mths fiscal period FPE changed again in FY02 to September 30 following Disney s acquisition of FFWW, in order to be coterminous with Disney s FPE; 15 mths fiscal period In order to allow comparability, first 12 months of extended fiscal period released to the market as well Accordingly, to be consistent with prior year disclosures comparative 12 month period is June 30, 2002

18 Prior Year Fiscal Periods Compared Slide 18 (US$mil) 12 months ended Sept 30, months ended June 30, 2002 Net Revenues Costs and Expenses EBITDA Depreciation Programme Amortisation Operating Loss Other Financial Items Loss Before Tax (77.7) 46.4 (2.6) (80.8) (37.0) 1.0 (36.0) (76.0) 53.3 (2.2) (85.2) (34.1) 1.4 (32.7)

19 Financial Highlights Substantial progress on all key indicators Slide 19 (US$mil) FY 03 FY 02* Change* Total Revenues % EBITDA % Income Before Tax 5.6 (32.7) 117% EPS (cents) (35.0) 113% Operational Cash Flow % 1 Before cumulative effect of change in accounting principle * Unless otherwise stated all comparisons are for the 12 months ended September 30, 2003 versus the 12 months ended June 30, 2002

20 Revenue Contribution Breakdown by LOB and geographic segment Slide 20 Line of Business Country Advertising 20% Channels & Online 72% Consumer Products 7% Subscription and Other 52% Programme Distribution 21% Benelux 10% Italy 10% Spain & Portugal 8% France 11% UK 26% Poland 4% Nordic Region 4% Germany 7% CEE 8% Americas 6% ME 6% Total revenues for the year ended September 30, 2003: $152.0 mil

21 Channels & Online Core business profitability continues to grow Slide 21 Financial Performance ($mil) Overview 41% % % 45% FY 01 FY 02 FY 03 Revenues up 31% to $109.4 mil Advertising revenues up 36%; now represents 28% of channel revenues Reported EBITDA margins diluted by integration of online EBITDA margin of 40%* still within target range 5.6 Revenues EBITDA *Calculated on net revenues

22 Channel & Online Revenues Slide 22 Subscription Revenues ($mil) Advertising Revenues ($mil) Other Revenues ($mil) 36% % % 36% % % 0.5 FY 01 FY 02 FY 03 Total channel & online revenues: $ mil

23 Programme Distribution Recovery expected in FY05 Slide 23 Financial Performance ($mil) Overview 59.0 FY 01 FY 02 FY 03 Ongoing improvement in programme quality and quantity expected Benefits will be seen in FY05 and onwards (32%) (22%) (41%) (29%) Expect approx. 250 episodes to be delivered next year Revenues better than our forecast, as some episodes delivered ahead of schedule Reductions in overhead mainly offset by increased participation expenses in second half of the year Revenues EBITDA

24 Slide 24 Consumer Products Financial Peformance ($mil) Overview 9% % FY 01 FY 02 FY 03 Revenues up 21% to $11.3 mil Power Rangers particularly strong with revenues up by 65% $3 mil increase in home entertainment revenues Revenues (4%) (9%) 4.0 EBITDA EBITDA down from $4.4 mil to $4.0 mil German operations restructured: Improved efficiency $0.25 mil adverse impact

25 Cash Flow 17% improvement in operating cash flow Slide 25 (US$mil) FY 03 FY 02 Net income/(loss) 3.8 (44.0) Non-cash items Programming (44.1) (47.9) Working capital OPERATING CASH FLOW % Dividends and loans repaid by affiliates Acquisition of FKI (20.8) - Capex (1.2) (1.3) Cash flow pre FX (9.3) 7.7

26 Operating Cashflow Slide 26 $mil FY00 FY01 FY02 FY (9.9) -15 (15.6) -20

27 Summary Fox Kids Europe well positioned for future growth Slide 27 N o 1 childrens Pan-European channel network One of the largest children s programme libraries in the world Programme distribution to fall further in FY04 before returning to growth in FY05 Free cash flow positive Strong balance sheet; $51.5 mil net cash balances Support from Disney, the world s leading provider of family entertainment

28 Slide 28