TECHNICOLOR : TECHNICOLOR - First quarter 2013 revenues: Robust revenue growth of 2.2% at constant scope and currency PRESS RELEASE First quarter 2013 revenues: Robust revenue growth of 2.2% at constant scope and currency Paris (France), 26April2013- The Board of Directors of Technicolor (EuronextParis:TCH) met yesterday to review the Group's revenues (unaudited) for the first quarter of 2013. Q1 2013 revenue highlights In the first quarter of 2013, Group revenues from continuing operations amounted to €775million, up 2.1% at constant scope^ and current currency and up 2.2% at constant scope and currency compared to the first quarter of 2012 revenues^. oTechnology: Another quarter of solid Licensing revenues, driven by good performance of the different licensing programs. oEntertainment Services: Slightly higher revenues year-on-year excluding legacy activities, with sustained growth in DVD Services revenues and robust level of activities in Digital Creative Services. oConnected Home: Strong performance in line with the momentum recorded in H2 2012. In € million Q1 2012 Q1 2013 Change, at constant scope and currency (unaudited) (unaudited) (%) Group revenues from continuing 800 775 +2.2% operations Change as reported (%) (3.2)% Change at constant currency (3.1)% (%) o/w Technology 121 125 (1.5)% Change as reported (%) +3.3% Change at constant (1.5)% currency (%) Entertainment Services 395 376 (5.4)% Change as reported (%) (4.9)% Change at constant (5.4)% currency (%) Connected Home 242 274 +16.3% Change as reported (%) +13% Change at constant +16.3% currency (%) Digital Delivery 42 0 - (activities disposed) Financial Structure update · Gross debt at the end of March 2013 amounted to €1,222 million at nominal value and €1,107million on an IFRS basis, a decrease of respectively €14 million and €8 million compared to the end of December 2012, mainly resulting from €36million of debt repayments partly offset by the impact of the appreciation of the US dollar. The level of cash was lower compared to end of December 2012 mostly due to debt repayments and the payment of the €38.6 million EU antitrust fine in March 2013. ·Technicolor has put in place a new €50 million receivables backed committed credit facility with Natixis replacing the previous facility which expired in April 2013.This new facility, at improved terms versus the previous one, matures in April 2016. 2013 objectives confirmed · Growth of adj. EBITDA of between 5% to 10% compared to FY 2012 adj. EBITDA at constant scope^ (€498 million): o Licensing adj. EBITDA broadly stable vs. FY 2012 assuming another year of strong contracts; o Continued improvement of Connected Home adj. EBITDA and return to positive free cash flow generation in this segment; o Improved profitability in Entertainment Services, reflecting cost actions implemented in H2 2012; o Continued increase in operating expenses for M-GO and new growth initiatives. · Strong growth in Free Cash Flow, above 30%, before one-off payments for legacy litigation (particularly the EU antitrust fine for €38.6million). · Net debt to adj. EBITDA ratio (as per the Group's covenants) below 1.25x at end-December 2013. Frederic Rose, Chief Executive Officer of Technicolor, stated: "This quarter was marked by robust revenue growth resulting from our continued focus on execution. This good performance was driven by sustained Licensing revenues, a great performance in Connected Home and revenue growth in our core Entertainment Services. We have increased market shares across our different businesses and maintained our focus on innovation to support their growth and to further strengthen our intellectual property. We are on track to deliver on our 2013 commitments." An analyst conference call hosted by Frederic Rose, CEO and Stéphane Rougeot, CFO and SEVP Strategy will be held on Friday, 26April2013 at 4:00pm CET. Financial Calendar AGM 2013 May 23 2013 H1 2013 Results July 26 2013 Q3 2013 Revenues 25 October 2013 *** Warning: Forward Looking Statements This press release contains certain statements that constitute "forward-looking statements", including but not limited to statements that are predictions of or indicate future events, trends, plans or objectives, based on certain assumptions or which do not directly relate to historical or current facts. Such forward-looking statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the future results expressed, forecasted or implied by such forward-looking statements. For a more complete list and description of such risks and uncertainties, refer to Technicolor's filings with the French Autorité des marchés financiers. *** About Technicolor Technicolor, a worldwide technology leader in the media and entertainment sector, is at the forefront of digital innovation. Our world class research and innovation laboratories enable us to lead the market in delivering advanced video services to content creators and distributors. We also benefit from an extensive intellectual property portfolio focused on imaging and sound technologies, based on a thriving licensing business. Our commitment: supporting the delivery of exciting new experiences for consumers in theaters, homes and on-the-go. Euronext Paris: TCH www.technicolor.com Contacts Press: +33 1 41 86 53 93 email@example.com Investor relations: +33 1 41 86 55 95 firstname.lastname@example.org Review by segment for the first quarter of 2013 Technology In € million Q1 2012 Q1 2013 Revenues 121 125 Change as reported (%) +3.3% Change at constant currency (%) (1.5)% o/w Licensing revenues 121 125 Change as reported (%) +3.6% Change at constant currency (%) (1.3)% In the first quarter of 2013, Technology revenues amounted to €125million, up 3.3% at current currency and down 1.5% at constant currency compared to the first quarter of 2012. This performance reflected the quality of the Group's Licensing division, whose quarterly revenues once again exceeded €100million. Licensing In the first quarter of 2013, Licensing revenues amounted to €125million, up 3.6% at current currency compared to the first quarter of 2012. At constant currency, Licensing revenues were down 1.3% year-on-year, as softer revenues generated by the MPEG LA pool were mostly offset by a sustained performance of the other patent licensing programs. The Group's Digital TV program posted another quarter of strong growth, driven by new contracts and contract renewals in the second half of 2012. Research and Innovation R&I continued its focus in the first quarter on delivering high quality intellectual property, increasing significantly its level of disclosures. R&I made also several advances with metadata, in particular around new techniques for on-set metadata. R&I also continued to sharpen exploration of laboratory research relating emotional feedback (via bio-sensors) to viewer interest level of films and commercials and deployed algorithms with audiences viewing four full length films in regular theaters. Such viewer participation in Technicolor research is complemented by targeted collaborative activity with some studios and directors aimed at rendering the technology valuable both to content creators and to viewers. Bringing such research elements together underpins the objective of making viewing of content comfortable in the expanding ecosystem of format diversity and also in rendering the choice of content uniquely personal and intuitive. Regarding M-GO, the Group has been improving overall technical capabilities on the basis of beta testing feedback. Technicolor initiated first marketing tests and has been working closely with its consumer electronic partners to complete integration in their devices. Preloaded devices are expected to be launched progressively during the second quarter. M-GO is also continuing discussions with additional device manufacturers. Entertainment Services In € million Q1 2012 Q1 2013 Revenues 395 376 Change as reported (%) (4.9)% Change at constant currency (%) (5.4)% Revenues excluding legacy activities* 345 352 Change as reported (%) +2.2% Change at constant currency (%) +1.8% * Legacy activities include mainly photochemical film and compression & authoring activities. In the first quarter of 2013, Entertainment Services revenues amounted to €376million, down 4.9% at current currency and down 5.4% at constant currency compared with the first quarter of 2012. Excluding legacy activities, whose revenues at constant currency declined by half in the quarter, Entertainment Services revenues were up 2.2% at current currency and up 1.8% at constant currency compared to the first quarter of 2012, due to a good performance in DVD Services, driven by sustained volume growth, particularly for Blu-ray(TM) discs, which offset lower Creative Services revenues. DVD Services In the first quarter of 2013, combined Standard DVD and Blu-ray(TM) volumes increased by 9%, driven by stable SD-DVD volume in combination with strong Blu-ray(TM) growth of almost 100% over the first quarter of 2012. Volume growth was supported in part by a strong slate of new release titles in the quarter, which mainly included The Hobbit: An Unexpected Journey (Warner), Wreck-It-Ralph (Disney), Les Miserables (Universal), Rise of the Guardians (Paramount/DreamWorks) and Django Unchained (Weinstein). Growth in Blu-ray^TM volumes in the first quarter was further bolstered by selective share increases across the existing customer base. In addition, the ongoing popularity with consumers of multi-disc DVD/Blu-ray(TM) "combo-packs" and other special edition sets has continued to help drive strong disc replication demand for both SD-DVD and Blu-ray(TM). Games volumes declined by 4.2million units compared to a very strong first quarter of 2012, which included a larger release slate of titles from several key publishers. This reduction was partially offset by an increase in Software related volumes. DVD and Blu-ray(TM) Volumes In million units Q1 2012 Q1 2013 Total Volumes 297 322 Change (%) +9% o/w SD-DVD (Standard Definition DVD) 248 249 Change (%) +0% BD (Blu-ray(TM)) 27 54 Change (%) +98% Games 16 12 Change (%) (26)% Software and Kiosk 6 7 Change (%) +34% Creative Services In the first quarter of 2013, Creative Services recorded a year-on-year decline in revenues, due to a 54% revenue drop at constant currency in legacy activities and a weak level of activity in January and February in Digital Production. In the quarter, the Group continued to focus its Digital Postproduction and Digital Distribution Services on their core strengths, in particular video and sound activities in Postproduction and work on digital content libraries in Distribution. The Group expects the overall Digital Creative Services activities to rebound in the next quarter. Digital Creative Services oDigital Production activities recorded a year-on-year decline in revenues in the first quarter of 2013, reflecting a lower level of activity in January and February in Visual Effects ("VFX") for feature films due to the delay in some sizeable projects. However, Commercial VFX activities performed strongly in the first quarter of 2013, especially in the United States. In particular, the introduction of new services in New York strengthened the Group's market share in this key advertising market. Based on the current solid backlog, Digital Production activities are expected to rebound in the next quarter. In the first quarter of 2013, VFX teams continued to work on Maleficent (Disney), Lone Ranger (Disney) and 7^th Son (Warner). Technicolor was also honored with the Academy Award ® for visual effects on Life of Pi (Fox), further demonstrating its excellence in servicing its studio customers. oDigital Postproduction revenues reported growth in the first quarter of 2013 compared to the first quarter of 2012. The Group posted solid revenue growth in North America driven by a strong level of activity in particular in Video with market share gains both in Theatrical and Broadcast. However, this good performance was partly offset by the continued weakness of the European markets and the resulting revenue decrease in the region, in particular in Italy. During the first quarter of 2013, Digital Postproduction teams continued to work on movies such as G.I. Joe: Retaliation and World War Z (Paramount), Gravity (Warner) and Oblivion (Universal) in Theatrical, as well as on successful TV series such as Mad Men Season 5 (AMC), Scandal Season 2 (ABC) and The Following Season 1 (Fox) in Broadcast. oDigital Distribution Services posted revenue growth in the first quarter of 2013 compared to last year. The continued sustained level of work on digital content libraries for Major Studios and Distributors, Video-on-Demand and Over-the-Top aggregators compensated the significant revenue decline in Localization Services (subtitling), in particular in North America as a consequence of the subcontracting agreement of the Compression & Authoring activity in the third quarter of 2012. oDigital Cinema activities recorded volume growth year-on-year but revenues were affected by the price reductions granted to some key customers in 2012. At the end of March 2013, digital screen penetration was 84% in North America and 74% in Europe. Legacy activities As expected, legacy activities continued to decline sharply in the first quarter of 2013, and represented at the end of March 2013 only 3% of Group revenues compared to 6.3% in the first quarter of 2012. The subcontracting agreements implemented in 2011 and 2012 allowed to mitigate the impact of this sharp drop on the Group's profitability. Connected Home Following the sale of the Broadcast Services and the SmartVision (television-over-IP) businesses in 2012, and the disposal of Cirpack softswitch operations (voice-over-IP) in 2013, the Group renamed the existing "Digital Delivery" segment to "Connected Home". The business review is focused on Connected Home. In € million Q1 2012 Q1 2013 Proforma revenues 242 274 Change as reported (%) +13.0% Change at constant currency (%) +16.3% In the first quarter of 2013, Connected Home revenues totaled €274million, up 13% at current currency and up 16.3% at constant currency compared to the first quarter of 2012, marking the fourth straight quarter of double-digit year-on-year growth. This performance principally reflected continued strong demand in emerging markets, particularly Brazil and Mexico in Latin America, as well as in India, combined with some volume growth in Europe. In North America, lower shipments were partially offset by further improvement in overall product mix. Technicolor continues to expect double-digit year-on-year growth in Connected Home revenues for 2013, in line with the first quarter trend, driven by sustained demand and market share gains in the fast-growing emerging markets, as well as the ramp-up of higher-end devices launched in 2012 and the introduction of new products in the course of 2013, notably starting in the third quarter of 2013 for Cable customers in North America. The turnaround plan of the Connected Home segment, launched in December 2011, is on track and the Group expects to post annualized cost savings of approximately €45million in 2013 compared to 2011 cost base. As a result, Technicolor confirms it anticipates further improvement in adjusted EBITDA for Connected Home and a return to a positive free cash flow generation in this segment in 2013. oIn North America, Connected Home product volumes declined significantly in the first quarter of 2013, reflecting a drop in set top box shipments related to the phase-out of some Satellite products, reduced deliveries of digital-to-analog Cable adaptors and the timing of new product introductions (expected to occur in the third quarter of 2013), offset in part by strong growth in volumes of Cable gateways. Overall product mix improved strongly year-on-year, benefiting from increased contribution of higher-end devices in Cable, partly offset by lower shipments of High Definition PVRs in Satellite compared to last year. oIn Latin America, Connected Home product volumes recorded another quarter of double digit growth, driven by sustained customer demand and market share gains across the region. This performance reflected increased shipments of Satellite set top boxes, particularly in Brazil, as well as stronger deliveries of Telecom products such as broadband gateways, especially in Mexico. Overall product mix improved year-on-year, due to higher proportion of High Definition products compared to last year. oIn Europe, Middle-East and Africa, Connected Home product volumes were up in the first quarter of 2013, due to sustained growth in shipments of Cable modems, partly offset by softness in deliveries of other product categories. Overall product mix was lower year-on-year, as a result of a less favorable product mix in Telecom, offset in part by improvements in Satellite and Cable compared to last year. oIn Asia-Pacific, Connected Home product volumes experienced very strong growth in the first quarter of 2013, driven principally by buoyant customer demand for set top boxes, particularly in India. Overall product mix was lower year-on-year, due to weaker proportion of High Definition products compared to last year. Connected Home Product Volumes In million units Q1 2012 Q1 2013 Total Volumes* 6.3 7.1 Change (%) +12% o/w North America 2.0 0.6 Change (%) (69)% Latin America 2.5 3.7 Change (%) +46% Europe, Middle-East and Africa 1.3 1.3 Change (%) +4% Asia-Pacific 0.5 1.4 Change (%) +182% * Including tablets and other connected devices APPENDIX Following the sale of the Broadcast Services and the SmartVision (television-over-IP or IPTV) businesses in 2012, and the disposal of Cirpack softswitch operations (voice-over-IP or VoIP) in 2013, Technicolor renamed the existing "Digital Delivery" segment "Connected Home". The following table provides proforma information on quarterly revenues per segment for 2012 and the first quarter of 2013 (excluding Broadcast Services, IPTV and VoIP activities). In € million Q1 12 Q2 12 H1 12 Q3 12 Q4 12 H2 12 FY 12 Q1 13 Technology 121 115 236 128 150 279 515 125 Entertainment Services 395 362 757 449 524 973 1,730 376 Connected Home 242 330 572 345 326 671 1,244 274 Other 0 0 0 0 1 1 1 0 Group revenues* 759 807 1,566 922 1,001 1,923 3,489 775 * From continuing operations -------------------------  Excluding the Broadcast Services and the SmartVision (television-over-IP) businesses, sold in 2012, and the Cirpack softswitch operations (voice-over-IP), sold in 2013. Those activities contributed €42 million of revenues in the first quarter of 2012 (no contribution in the first quarter of 2013).  On a reported basis, including disposals, revenues were down 3.2% at current currency and down 3.1% at constant currency.  Adjusted EBITDA at constant scope excluding the Broadcast Services and the SmartVision (television-over-IP) businesses, sold in 2012, and the Cirpack softswitch operations (voice-over-IP), sold in 2013. Technicolor - Q1 2013 Revenues ------------------------------------------------------------------------------ This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients. The owner of this announcement warrants that: (i) the releases contained herein are protected by copyright and other applicable laws; and (ii) they are solely responsible for the content, accuracy and originality of the information contained therein. Source: TECHNICOLOR via Thomson Reuters ONE HUG#1696686
TECHNICOLOR : TECHNICOLOR - First quarter 2013 revenues: Robust revenue growth of 2.2% at constant scope and currency
Press spacebar to pause and continue. Press esc to stop.