Nielsen Reports First Quarter 2013 Results

  Nielsen Reports First Quarter 2013 Results

  *Revenues for the quarter increased 3% to $1,376 million, up 4% in constant
    currency
  *Adjusted EBITDA for the quarter grew 5% to $349 million, up 6% in constant
    currency
  *Net income for the quarter grew 36% to $34 million, up 53% in constant
    currency
  *Adjusted Net Income for the quarter grew 26% to $145 million, up 29% in
    constant currency

Business Wire

NEW YORK -- April 25, 2013

Nielsen Holdings N.V. (NYSE: NLSN), a leading global provider of information
and insights into what consumers buy and watch, today announced financial
results for the quarter ended March 31, 2013.

“Nielsen delivered solid revenue growth and strong operating performance in
the first quarter,” said David Calhoun, Chief Executive Officer of Nielsen.
“Our results reflect our continued ability to create value for our clients and
we remain well-positioned to achieve our 2013 expectations.”

First Quarter 2013 Operating Results

Revenues for the first quarter increased 3% to $1,376million, or 4% on a
constant currency basis compared to the first quarter of 2012. Our revenue
performance was driven by a 3% increase within our Buy segment (5% increase on
a constant currency basis), a 4% increase within our Watch segment (4% on a
constant currency basis) and a 7% decrease in our Expositions segment (7% on a
constant currency basis). Global growth in Information services was driven by
increased client investment in retail measurement, including the impact of
additional coverage in the U.S. market. Our Insights services revenues
declined due to lower discretionary spending by clients.

Adjusted EBITDA for the first quarter increased 5% to $349 million, or 6% on a
constant currency basis compared to the first quarter of 2012. We continue to
see the benefits of productivity efforts that enable our reinvestment in
growth initiatives.

Net income for the first quarter increased 36% to $34 million, or 53% on a
constant currency basis compared to the first quarter of 2012. Net income per
share, on a diluted basis, was $0.09 compared to $0.07 in the first quarter of
2012.

Adjusted Net Income for the first quarter increased 26% to $145 million, or
29% on a constant currency basis compared to the first quarter of 2012.
Adjusted Net Income per share was $0.38 compared to $0.31 in the first quarter
of 2012.

Financial Position

As of March 31, 2013, cash balances were $233 million and gross debt was
$6,320 million. Net debt (gross debt less cash and cash equivalents) was
$6,087 million and our net debt leverage ratio was 3.76x at the end of the
quarter. On March 20, 2013, our first quarterly dividend payment of $0.16 per
share was made to shareholders of record as of March 6, 2013. Capital
expenditures were $70 million for the first quarter of 2013 as compared to $82
million in the first quarter of 2012.

In February 2013, we amended our senior secured credit agreement to provide
for a new class of term loans with an aggregate principal amount of $2.9
billion maturing May 1, 2016. The proceeds from this term loan were used to
repay or replace in full a like amount of our existing ClassA Term Loans
maturing August9, 2013, Class B Term Loans maturing May1, 2016 and Class C
Term Loans maturing May1, 2016. As of March 31, 2013, approximately 90% of
our debt portfolio had a maturity of 2016 or beyond.

Additionally, in February 2013, a secondary public offering of 40.8 million
shares of our common stock was completed on behalf of certain selling
stockholders, primarily comprised of the Sponsor group. All proceeds were
received by the selling stockholders and the offering did not have a
significant impact on our operating results or financial position.

Other Matters

On April 16, 2013, Arbitron’s shareholders voted to approve our proposed
acquisition of Arbitron. The transaction remains subject to customary closing
conditions, including regulatory review.

Conference Call and Webcast

Nielsen will hold a conference call to discuss first quarter results at 8:30
a.m. U.S. Eastern Time (ET) on April 25, 2013. The audio and slides for the
call can be accessed live by webcast at www.nielsen.com/investors or by
dialing +1-888-317-6016. Callers outside the U.S. can dial +1-412-317-6016.
The passcode for the call is “Nielsen.” An audio replay and transcript will be
available on the investor relations website after the call.

Forward-looking Statements

This news release includes information that could constitute forward-looking
statements made pursuant to the safe harbor provision of the Private
Securities Litigation Reform Act of 1995. These statements may be identified
by words such as ‘will’, ‘expect’, ‘should’, ‘could’, ‘shall’ and similar
expressions. These statements are subject to risks and uncertainties, and
actual results and events could differ materially from what presently is
expected. Factors leading thereto may include without limitations general
economic conditions, conditions in the markets Nielsen is engaged in, behavior
of customers, suppliers and competitors, technological developments, the
acquisition of Arbitron, as well as legal and regulatory rules affecting
Nielsen’s business and specific risk factors discussed in other releases and
public filings made by the Company (including the Company’s filings with the
Securities and Exchange Commission). This list of factors is not intended to
be exhaustive. Such forward-looking statements only speak as of the date of
this press release, and we assume no obligation to update any written or oral
forward-looking statement made by us or on our behalf as a result of new
information, future events, or other factors.

About Nielsen

Nielsen Holdings N.V. (NYSE: NLSN) is a global information and measurement
company with leading market positions in marketing and consumer information,
television and other media measurement, online intelligence, mobile
measurement, trade shows and related properties. Nielsen has a presence in
approximately 100 countries, with headquarters in New York, USA and Diemen,
the Netherlands. For more information, visit www.nielsen.com.

From time to time, Nielsen may use its website and social media outlets as
channels of distribution of material company information. Financial and other
material information regarding the company is routinely posted and accessible
on our website at http://www.nielsen.com/investors, our Twitter account at
http://twitter.com/NielsenIR and our iPad App, NielsenIR, available on the App
Store.

Results of Operations—(Three Months Ended March 31, 2013 and 2012)

The following table sets forth, for the periods indicated, the amounts
included in our Condensed Consolidated Statements of Operations:

                                                           
                                             Three Months Ended

                                             March 31

                                             (Unaudited)
(IN MILLIONS EXCEPT SHARE AND PER SHARE    2013             2012
DATA)
Revenues                                     $ 1,376         $ 1,334       
                                                               
Cost of revenues                               593               564
Selling, general and administrative            451               447
expenses
Depreciation and amortization                  126               129
Restructuring charges                         35             37          
                                                               
Operating income                              171            157         
                                                               
Interest income                                1                 1
Interest expense                               (83         )     (106        )
Foreign currency exchange transaction          (12         )     (9          )
losses, net
Other expense, net                            (12         )   (6          )
                                                               
Income from continuing operations before
income taxes and equity in net income of       65                37
affiliates
Provision for income taxes                     27                8
Equity in net loss of affiliates              1              2           
                                                               
Income from continuing operations              37                27
Loss from discontinued operations, net        3              2           
of tax
                                                               
Net income                                     34                25
Net loss attributable to noncontrolling       1              —           
interests
                                                               
Net income attributable to Nielsen           $ 35            $ 25          
stockholders
                                                               
Net income per share of common stock,
basic and diluted
Income from continuing operations            $ 0.10            $ 0.07
Discontinued operations, net of tax          $ (0.01       )   $ (0.00       )
Net income attributable to Nielsen           $ 0.09            $ 0.07
stockholders
                                                               
Weighted-average shares of common stock        370,583,217       360,881,693
outstanding, basic^(a)
Dilutive shares of common stock               4,973,804      4,839,365   
Weighted-average shares of common stock       375,557,021    365,721,058 
outstanding, diluted

      On February 1, 2013, the mandatory convertible subordinated bonds were
(a)  converted into 10,416,700 shares of Nielsen’s common stock at a
      conversion rate of 1.8116 shares per $50.00 principal amount of the
      bonds.
      

Certain Non-GAAP Measures

We use the non-GAAP financial measures discussed below to evaluate the results
of our operations. We believe that the presentation of these non-GAAP measures
provides useful information to investors regarding financial and business
trends related to our results of operations and that when this non-GAAP
financial information is viewed with our GAAP financial information, investors
are provided with a more meaningful understanding of our ongoing operating
performance. None of the non-GAAP measures presented should be considered as
an alternative to net income or loss, operating income or loss, cash flows
from operating activities, total indebtedness or any other measures of
operating performance, liquidity or indebtedness derived in accordance with
GAAP. These non-GAAP measures have important limitations as analytical tools
and should not be considered in isolation or as substitutes for an analysis of
our results as reported under GAAP. Our use of these terms may vary from the
use of similarly-titled measures by others in our industry due to the
potential inconsistencies in the method of calculation and differences due to
items subject to interpretation.

Constant Currency Presentation

We evaluate our results of operations on both an as reported and a constant
currency basis. The constant currency presentation, which is a non-GAAP
measure, excludes the impact of fluctuations in foreign currency exchange
rates. We believe providing constant currency information provides valuable
supplemental information regarding our results of operations, consistent with
how we evaluate our performance. We calculate constant currency percentages by
converting our prior-period local currency financial results using the current
period exchange rates and comparing these adjusted amounts to our current
period reported results.

Adjusted EBITDA and Adjusted Net Income

We define Adjusted EBITDA as net income or loss from our consolidated
statements of operations before interest income and expense, income taxes,
depreciation and amortization, restructuring charges, goodwill and intangible
asset impairment charges, stock-based compensation expense and other
non-operating items from our consolidated statements of operations as well as
certain other items considered unusual or non-recurring in nature. We use
Adjusted EBITDA to measure our performance from period to period both at the
consolidated level as well as within our operating segments, to evaluate and
fund incentive compensation programs and to compare our results to those of
our competitors.

We define Adjusted Net Income as net income or loss from our consolidated
statements of operations before income taxes, depreciation and amortization
associated with acquired tangible and intangible assets, restructuring
charges, goodwill and intangible asset impairment charges, other non-operating
items from our consolidated statements of operations and certain other items
considered unusual or non-recurring in nature, reduced by cash paid for income
taxes. Also excluded from Adjusted Net Income is interest expense attributable
to the mandatory convertible subordinated bonds converted on February 1, 2013.
Adjusted Net Income per share of common stock presented on a diluted basis
includes potential common shares associated with stock-based compensation
plans that may have been considered anti-dilutive in accordance with GAAP. The
amount also includes the weighted-average amount of shares of common stock
convertible associated with the mandatory convertible bonds based upon the
average price of our common stock during the period.

Adjusted Net Income and Adjusted Net Income per share of common stock are not
presentations made in accordance with GAAP.

The below table presents a reconciliation from net income to Adjusted EBITDA
and Adjusted Net Income and a reconciliation from weighted-average shares
outstanding on a GAAP basis to diluted shares outstanding for the three months
ended March 31, 2013 and 2012, respectively:

                                            
                                               Three Months Ended

                                               March 31,

                                               (Unaudited)
(IN MILLIONS EXCEPT SHARE AND PER SHARE      2013            2012
DATA)
Net income                                     $ 34            $ 25
Loss from discontinued operations, net of        3               2
tax
Interest expense, net                            82              105
Provision for income taxes                       27              8
Depreciation and amortization                   126           129         
                                                               
EBITDA                                           272             269
Equity in net loss of affiliates                 1               2
Other non-operating expense, net                 24              15
Restructuring charges                            35              37
Stock-based compensation expense                 10              8
Other items                                     7             2           
                                                               
Adjusted EBITDA                                  349             333
Interest expense, net                            (82         )   (105        )
Depreciation and amortization                    (126        )   (129        )
Depreciation and amortization associated
with acquisition-related tangible and            41              41
intangible assets
Cash paid for income taxes                       (29         )   (23         )
Stock-based compensation expense                 (10         )   (8          )
Interest expense attributable to mandatory      2             6           
convertible bonds
                                                               
Adjusted net income                            $ 145          $ 115         
                                                               
Adjusted net income per share of common        $ 0.38         $ 0.31        
stock, diluted
                                                               
Weighted-average shares of common stock          370,583,217     360,881,693
outstanding, basic
Dilutive shares of common stock from stock       4,973,804       4,839,365
compensation plans
Shares of common stock convertible
associated with the mandatory convertible       3,587,974     10,416,700  
bonds
                                                               
Weighted-average shares of common stock         379,144,995   376,137,758 
outstanding, diluted
                                                                             

Net Debt and Net Debt Leverage Ratio

The net debt leverage ratio is defined as net debt (gross debt less cash and
cash equivalents) as of the balance sheet date divided by Adjusted EBITDA for
the twelve months then ended. Net debt and the net debt leverage ratio are
commonly used metrics to evaluate and compare leverage between companies and
are not presentations made in accordance with GAAP. The calculation of net
debt and the net debt leverage ratio as of March 31, 2013 is as follows:


(IN MILLIONS)
Gross debt as of March 31, 2013                                    $ 6,320
Less: cash and cash equivalents as of March 31, 2013                   233
                                                                      
Net debt as of March 31, 2013                                         $ 6,087
                                                                      
Adjusted EBITDA for the year ended December 31, 2012                  $ 1,605
Less: Adjusted EBITDA for the three months ended March 31, 2012         333
Add: Adjusted EBITDA for the three months ended March 31, 2013         349
                                                                      
Adjusted EBITDA for the twelve months ended March 31, 2013            $ 1,621
Net debt leverage ratio as of March 31, 2013                          3.76x
                                                                      

Unaudited Supplemental Information

In March 2013, we completed the exit and shut down of one of our legacy online
businesses, and recorded a net loss of $3 million associated with this
divestiture. The condensed consolidated statements of operations reflect the
operating results of this business as a discontinued operation. Note that the
discontinued operations had no impact on our Buy or Expositions segments.
Summarized results of operations for this discontinued operation for the three
months ended March 31, 2013 are as follows:

                         
(IN MILLIONS)
Revenues                      $   3
Adjusted EBITDA                   (2)
                                  

The below tables detail supplemental unaudited Total Nielsen and Watch segment
revenues and non-GAAP business segment income, which have been adjusted to
reflect the impact of the discontinued operations on our historical operating
results, for each of the quarterly periods in the two years ended December31,
2012 and 2011.

                                            
                                                 Total
Revenues                               Watch
                                                 Nielsen
(IN MILLIONS)
2012
Three months ended March 31            $ 474     $ 1,334
Three months ended June 30               493       1,380
Three months ended September 30          499       1,418
Three months ended December 31          521      1,458
                                                 
Total                                  $ 1,987   $ 5,590
                                                 
                                                 Total
Revenues                               Watch
                                                 Nielsen
(INMILLIONS)
2011
Three months ended March 31            $ 462     $ 1,296
Three months ended June 30               481       1,390
Three months ended September 30          479       1,407
Three months ended December 31          497      1,414
                                                 
Total                                  $ 1,919   $ 5,507
                                                 
                                                 
                                                 Total
Non-GAAP Business Segment Income       Watch
                                                 Nielsen
(IN MILLIONS)
                                                 
2012
Three months ended March 31            $ 186     $ 333
Three months ended June 30               213       390
Three months ended September 30          213       425
Three months ended December 31          234      457
                                                 
Total                                  $ 846     $ 1,605
                                                 
2011
Three months ended March 31            $ 176     $ 319
Three months ended June 30               199       386
Three months ended September 30          195       408
Three months ended December 31          208      430
                                                 
Total                                  $ 778     $ 1,543
                                                 

Contact:

Nielsen Holdings N.V.
Investor Relations:
Liz Zale, +1 646-654-4593
or
Media Relations:
Kristie Bouryal, +1 646-654-5577
 
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