2015 q4 investor presentation

2015 Q4 INVESTOR

PRESENTATION

ODEON & UCI CINEMAS GROUP 23 March 2016

ODEON & UCI CINEMAS GROUP

2015 Q4 INVESTOR PRESENTATION

IMPORTANT INFORMATION

DISCLAIMER

THIS DOCUMENT HAS BEEN PREPARED BY ODEON & UCI FINCO PLC (“ODEON”). BY REVIEWING THIS DOCUMENT OR PARTICIPATING IN THE CONFERENCE CALL THAT PRESENTS IT, YOU AGREE TO BE BOUND BY THE FOLLOWING CONDITIONS.

THIS DOCUMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SECURITIES IN ODEON. FURTHERMORE, IT DOES NOT CONSTITUTE A RECOMMENDATION BY ODEON OR ANY OTHER PARTY TO SELL OR BUY SECURITIES IN ODEON OR ANY OTHER SECURITIES. ALL WRITTEN OR ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO ODEON OR PERSONS ACTING ON THEIR BEHALF ARE QUALIFIED IN THEIR ENTIRETY BY THESE CAUTIONARY STATEMENTS.

Unaudited Information

This document contains financial

information regarding ODEON and its

fellow subsidiaries (the “Group”). Such

financial information may not have been

audited, reviewed or verified by any

independent accounting firm. The inclusion

of such financial information in this

document or any related presentation

should not be regarded as a representation

or warranty by ODEON, any of its

respective affiliates, advisors or

representatives or any other person as to

the accuracy or completeness of such

information’s portrayal of the financial

condition or results of operations by the

Group.

Comparative Information

Where appropriate, to provide more

meaningful information, prior year reported

comparatives have been restated to

current year foreign exchange rates in this

document

Non-GAAP Information

We have presented certain non-GAAP

information in this document. As used in

this document, this information includes

‘‘EBITDA’’, which represents earnings

before interest, tax, depreciation,

amortisation, exceptional items and

strategic costs. Our management believes

that EBITDA is meaningful for investors

because it provides an analysis of our

operating results, profitability and ability to

service debt and because EBITDA is used

by our chief operating decision makers to

track our business evolution, establish

operational and strategic targets and make

important business decisions. In addition,

we believe that EBITDA is a measure

commonly used by investors and other

interested parties in our industry.

Forward-Looking Statements

This document includes forward-looking

statements. When used in this document,

the words “anticipate”, “believe”,

“estimate”, “forecast”, “expect”, “intend”,

“plan” and “project” and similar

expressions, as they relate to ODEON, its

management or third parties, identify

forward-looking statements. Forward-

looking statements include statements

regarding ODEON’s business strategy,

financial condition, results of operations,

and market data, as well as any other

statements that are not historical facts.

These statements reflect beliefs of

ODEON’s management, as well as

assumptions made by its management and

information currently available to ODEON.

Although ODEON believes that these

beliefs and assumptions are reasonable,

the statements are subject to numerous

factors, risks and uncertainties that could

cause actual outcomes and results to be

materially different from those projected.

These factors, risks and uncertainties

expressly qualify all subsequent oral and

written forward- looking statements

attributable to ODEON or persons acting

on its behalf.

2



AGENDA

1 2015 Q4 & FY15 highlights

2 2015 markets & films

3 Strategic progress

4 Financial highlights

5 Current trading and outlook

6 Q&A

7

Paul Donovan

Group Chief

Executive Officer

Mark Way

Group Chief

Financial Officer

Ian Shepherd

Group Chief

Commercial Officer

3

2015 Q4 & FY15 HIGHLIGHTS

PAUL DONOVAN CEO

1



2015: A YEAR OF TRANSFORMATION

Strong film slate drove an improved market

After 12 months of strategic transformation, the business

was well positioned to outperform the wider market

Rapid progress on strategic programmes, including:

• Upgraded hospitality experiences

• Pioneering pricing and retail strategies

• Advanced CRM and customer communication

• Improved training and development programmes

• Targeted investment promoting innovation and yield

Ongoing growth on a wide range of KPIs

5



Q4 HIGHLIGHTS STRONG FINISH TO A RECORD-BREAKING YEAR

Q4 Market Attendance1 up by 14.8% • Strong quarter as predicted

• Included the UK&I and Spanish No 1 films of

FY15

ODEON & UCI Q4 Paid Attendance up

15.5% • 3.6m more guests than Q4 2014

• Continued market share increases in UK &

Ireland, Italy and Germany

Box Office Revenue2 up 27.1%, driven

by blockbuster titles and ATP1,2

growth of 9.6%

Retail Revenue2 up 23.0% • Highest RPH growth of the year, delivered in

our busiest quarter

• Consequence of Group-wide retail initiatives

implemented earlier in the year

Total Revenue2 up 29.1%

EBITDA2 up 66.5% to £47.7m

1 At constant territory weighting

2 At constant FX rate

6

Q4 Q4

2015 2014

Market Weighted Attendance1 (m) 14.8%

ODEON & UCI Paid Attendance (m) 26.8 23.2 15.5%

Total Market Attendance Share1 19.4% 19.6% (0.1%) pts

Box Office Revenue2 (£m) 157.7 124.0 27.1%

Retail Revenue2 (£m) 53.9 43.9 23.0%

Total Revenue2 (£m) 239.1 185.1 29.1%

EBITDA2 (£m) 47.7 28.7 66.5%

Average Ticket Price1,2 (£) (ATP) 5.91 5.39 9.6%

Retail Revenue Per Head1,2 (£) (RPH) 2.02 1.92 5.6%

vs LY

Fav/(Adv)



FY15 HIGHLIGHTS IMPROVEMENT ON ALL KPIs DELIVERS RECORD EBITDA OF £94.8m



3 Based on Market GBOR

7

Market Attendance1 up 9.3% • Increased attendance in all territories

ODEON & UCI Paid Attendance up

14.0% • Significantly outperformed market

growth

• Regained No 1 Cinema Brand3 in UK&I

• Extended market share lead over

competitors in Spain and Italy

• Total market share1 up 0.6% pts

Retail Revenue2 up 19.2% • Group-wide focus on retail - with range

enhancements, new pricing and

promotions, and upgraded colleague

training - has driven a big increase in

RPH and retail revenue

Total Revenue2 up 19.7% • Combination of strategic actions across

the business to maximise the benefits

from a good film slate

Record FY EBITDA of £94.8m,

+84.6%2 vs 2014

FY FY

2015 2014

Market Weighted Attendance1 (m) 9.3%

ODEON & UCI Paid Attendance (m) 89.5 78.5 14.0%

Total Market Attendance Share1 19.4% 18.8% 0.6% pts

Box Office Revenue2 (£m) 500.7 419.5 19.4%

Retail Revenue2 (£m) 180.3 151.2 19.2%

Total Revenue2 (£m) 747.2 624.1 19.7%

EBITDA2 (£m) 94.8 51.3 84.6%

Average Ticket Price1,2 (£) (ATP) 5.62 5.40 4.0%

Retail Revenue Per Head1,2 (£) (RPH) 2.02 1.95 3.6%

Fav/(Adv)

vs LY

MARKETS AND FILMS

2



£30.1m

£32.7m

£32.7m

£33.4m

£34.3m

£47.5m

£48.3m

£64.3m

£87.1m

£93.8m

5

4

3

2

1

£20.3m

£21.8m

£27.2m

£30.1m

£32.7m

£19.8m

£21.8m

£28.1m

£87.1m

£93.8m

5

4

3

2

1

UK & IRELAND FY15 MARKET SIGNIFICANTLY AHEAD OF FY14

• Q4 market GBOR up 29%

vs Q4 2014

• FY15 GBOR up 15% vs

FY14, to £1.3 bn

• FY Total Attendance up

9% vs 2014, to 187m

• Spectre, released in

October, was No 1 film of

2015 and performed well

ahead (+£59m) of 2014

No 1 film The Lego Movie

(released in Q1 2014)

• Star Wars: Episode VII –

The Force Awakens was

No 2 film of the year,

despite being released in

second half of December

• ODEON regained GBOR

brand market leadership

Spectre

The Hobbit: The Battle of the Five...

Star Wars: Episode VII – The Force Awakens

Hunger Games: Mockingjay Pt 1


The Martian

Gone Girl

Paddington

Hotel Transylvania 2

Interstellar

Q4 2015 GBOR

Q4 2014 GBOR

9

Spectre

The Lego Movie


The Inbetweeners 2

Jurassic World

Avengers: The Age of Ultron

The Hobbit: The Battle of the Five ...

Dawn of the Planet of The Apes

Minions


2015 Q4 Top 5 Films by Market GBOR

FY15 GBOR

FY14 GBOR

FY15 Top 5 Films by Market GBOR



1.9m

2.1m

2.2m

2.7m

9.3m

3.4m

3.5m

3.8m

4.2m

5.0m

5

4

3

2

1

1.2m

1.4m

1.7m

1.8m

1.9m

1.7m

1.9m

2.0m

3.4m

5.0m

5

4

3

2

1

SPAIN FY15 +8%; ONGOING MARKET RECOVERY

• Q4 market up 22%

• FY15 total market

attendance up 8% vs

2014, to 95m

• Ocho Apellidos Catalanes

was market leader, but

under-performed

predecessor

• Other top films saw year

on year growth

• Market recovery

continues

• Cinesa strengthened

market leadership in

FY15

Ocho Apellidos Catalanes

Hunger Games ...

Star Wars: Episode VII – The Force ...

Torrente 5


The Martian

Interstellar

The Hobbit ...

Hunger Games...

Exodus

Q4 2015 Market

Attendance

Q4 2014 Market

Attendance

10

Ocho Apellidos Catalanes

Ocho Apellidos Vascos

Minions

El Niño

Inside Out

Jurassic World

Dawn of the Planet of ...

Maleficent

Star Wars: Episode VII – The Force ...

The Wolf of Wall Street

2015 Q4 Top 5 Films by Market Attendance

FY15 Top 5 Films by Market Attendance

FY15 Market

Attendance

FY14 Market

Attendance

Local titles in italic



2.5m

2.7m

3.5m

3.6m

4.6m

5.8m

6.0m

6.5m

6.8m

7.6m

5

4

3

2

1

1.3m

1.3m

1.6m

3.5m

4.6m

2.4m

3.4m

3.6m

5.8m

6.5m

5

4

3

2

1

GERMANY SOLID FILM SLATE IN 2015, MARKET UP 14%

• Q4 market up 12%

• FY total market

attendance up 14%, to

139m

• Good mix of genres

attracted a range of

guests

• Local films remain key

element of market

• UCI Kinowelt increasing

brand recognition

• Strategy driving cinema

profitability

Spectre

The Hobbit: The Battle of the Five Armies




Inside Out

The Penguins of...

Interstellar

Er ist wieder da

Paddington

Q4 2015 Market

Attendance

Q4 2014 Market

Attendance

11



FY15 Market

Attendance

FY14 Market

Attendance

Fack Ju Göhte 2

The Hobbit: The Battle of the Five Armies

Minions

Qu’est-ce qu’on a fait au Bon Dieu?

Spectre

Honig im Kopf

How to Train Your Dragon 2



Der Medicus




1.6m

1.6m

1.8m

1.9m

2.1m

2.9m

3.0m

3.0m

3.8m

4.4m

5

4

3

2

1

1.4m

1.4m

1.6m

1.7m

1.7m

1.3m

1.8m

1.9m

1.9m

2.8m

5

4

3

2

1

ITALY FY15 TOTAL MARKET UP +9%

• Q4 market up 9% vs

2014

• FY total market

attendance also up 9%,

to 107m

• Kids films Inside Out and

Minions performed very

well in FY15

• UCI extended market

leadership vs The Space


Interstellar

Spectre

Il Ricco, il Povero e il Maggiordomo

Inside Out


The Hunger Games ...

The Hobbit: The Battle of the Five ...

The Hunger Games ...

Andiamo a Quel Paese

Q4 2015 Market

Attendance

Q4 2014 Market

Attendance

12

Inside Out

Maleficent

Minions

Un Boss in Salotto

Fifty Shades of Grey

American Sniper

Sotto una Buona Stella

The Wolf of Wall Street

Fast & Furious 7

Interstellar



FY15 Market

Attendance

FY14 Market

Attendance


STRATEGIC PROGRESS

IAN SHEPHERD CCO

3



STRATEGIC PROGRESS ELEVATED STRONG Q4

Innovation in marketing and pricing

• Long term planning delivered high impact campaigns for all

Christmas blockbusters

• Active yield management through strategic pricing initiatives

optimised returns

• Further investment in CRM platforms increased

personalisation and campaign returns

• Launch of Unlimited subscription offer in Germany -

preparation for UK & Ireland launch of Limitless in Q1 2016

Improved digital offering

• New iOS app launched in UK; new website in Italy

• Record online advance bookings for Spectre and Star Wars

• Coordinated social media campaigns with distributors and

other partners to drive awareness and excitement

14



STRATEGIC PROGRESS ELEVATED STRONG Q4

Focus on guest experience in all cinemas

• Detailed training completed and plans in place across

Group

• New cinemas in Bolzano (Italy), Llobregat (Spain) and

Charlestown Dublin (Ireland) displaying latest guest

experience principles

• High Net Promoter Scores achieved during peak

periods

• Premieres and local events delighted guests showing

the value of strong partnerships with distributors and

studios

New retail initiatives and training

• Record weeks for retail sales

• Detailed ranging, pricing and marketing plans for

each film

• Hot and cold food & beverage

• Popular merchandise

• Insight-led combo deals

15

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FINANCIAL HIGHLIGHTS

MARK WAY CFO

4



TOTAL REVENUE UP 19.7% IN FY15 COMPREHENSIVE PROGRESS ON ALL KPIS

FY15 vs. FY14

• Market Share up in all territories; market

leader3 in 3 of our 4 territories in FY15

• Box Office Revenue2 increased by

19.4%; more than double Weighted

Market Attendance1 growth of 9.3%

• Investment in Group-wide retail offering

drove up RPH and a 19.2% rise in Retail

Revenue1,2

• Total Revenue2 up 19.7%



3 Based on GBOR in UK&I and Attendance in Spain and Italy

17

Q4 Q4 FY FY

2015 2014 2015 2014

Market Weighted Attendance1 (m) 14.8% 9.3%

ODEON & UCI Paid Attendance (m) 26.8 23.2 15.5% 89.5 78.5 14.0%

Total Market Attendance Share1 19.4% 19.6% (0.1%) pts 19.4% 18.8% 0.6% pts

Average Ticket Price1,2 (£) (ATP) 5.91 5.39 9.6% 5.62 5.40 4.0%

Retail Revenue Per Head1,2 (£) (RPH) 2.02 1.92 5.6% 2.02 1.95 3.6%

Box Office Revenue2 (£m) 157.7 124.0 27.1% 500.7 419.5 19.4%

Retail Revenue2 (£m) 53.9 43.9 23.0% 180.3 151.2 19.2%

Screen Ads and Other Revenue2 (£m) 27.4 17.2 59.2% 66.1 53.4 23.9%

Total Revenue2 (£m) 239.1 185.1 29.1% 747.2 624.1 19.7%

vs LY

Fav/(Adv)

vs LY

Fav/(Adv)



FY15 EBITDA UP £43.4m TO £94.8m – A NEW RECORD EXCELLENT Q4 CONTRIBUTED FURTHER TO A GOOD YEAR


18

Q4 Q4 FY FY

2015 2014 2015 2014

Gross Profit1 (£m) 148.5 119.2 24.5% 472.9 404.0 17.0%

Gross Profit Margin1 62.1% 64.4% (2.3%) pts 63.3% 64.7% (1.4%) pts

Operating Costs (Excl Rent)1 (£m) 70.6 60.6 (16.5%) 257.5 231.2 (11.4%)

Operating Costs (Excl Rent)1 as a % of

Total Revenue29.5% 32.7% 3.2% pts 34.5% 37.0% 2.6% pts

EBITDAR1 (£m) 77.9 58.6 32.9% 215.4 172.9 24.6%

Rent1 (£m) 30.2 30.0 (0.8%) 120.6 121.5 0.8%

EBITDA1 (£m) 47.7 28.7 66.5% 94.8 51.3 84.6%

EBITDA1 Margin 20.0% 15.5% 4.5% pts 12.7% 8.2% 4.5% pts

vs LY vs LY

Fav/(Adv) Fav/(Adv)FY15 vs. FY14 • Gross Profit up on last year driven by

increased attendance and

improvements in KPIs

• 2.6% pts improvement in operating cost

efficiency

• Rent1 was broadly in line with last year

• EBITDA1 increased by £43.4m driven

by increased attendance, higher

revenue per head and ongoing cost

control



LEVERAGE HALVED TO 4.2x

• Significant reduction in leverage delivered by improved

trading and strong cash inflow

• Working Capital and Other in Q4 was an inflow of

£35.4m reflecting the usual seasonal stronger year end

trading

• FY15 Capital Expenditure was higher than in 2014 due to

increased investment in the estate together with

investment related to strategic programmes

• FY15 Finance Costs primarily related to the interest

payments (four quarterly Euro and two half-yearly Sterling),

lower than last year due to a beneficial interest rate swap,

FX and lower usage of RCF

• FY15 Acquisitions and Disposals includes proceeds

from the disposal of 4 cinemas sold to Everyman (Q3)

• During the quarter the Euro weakened and therefore FX

includes the favourable foreign exchange impact on the

Sterling value of the Euro note. FY15 FX movement

favourable for the same reasons

19

Q4 Q4 FY FY

£m 2015 2014 2015 2014

EBITDA before FX impact 47.7 28.7 94.8 51.3

FX impact - 1.0 - 1.4

EBITDA 47.7 29.7 94.8 52.7

Working Capital and Other 35.4 34.3 11.6 0.4

Net Capital Expenditure (9.7) (9.5) (33.6) (25.9)

Provisions and One Offs (2.8) (0.4) (1.9) (10.9)

Finance Costs (1.8) (5.4) (40.6) (48.8)

Tax (Paid)/Received (0.0) (0.4) 0.6 0.2

Acquisitions and Disposals (0.5) 0.1 5.7 (0.3)

68.5 48.2 36.6 (32.6)

Propco - - - 16.5

Cash Flow 68.5 48.2 36.6 (16.1)

FX 1.2 (0.4) 10.2 11.2

Change in net debt 69.7 47.7 46.8 (4.9)

Net Debt 394.1 440.9

LTM EBITDA 94.8 52.7

Net Debt to LTM EBITDA 4.2x 8.4x

FUTURE SLATE

CURRENT TRADING & OUTLOOK

PAUL DONOVAN CEO

5



ENCOURAGING START TO 2016

21



BALANCED SLATE OF EXCITING TITLES SPREAD THROUGH YEAR

22

April May June

Q2

Q3

Q4

July August

October November December



CURRENT TRADING AND OUTLOOK

Market:

• Encouraging performance of lead titles

• Strong trading continues

Strategic progress:

• Limitless card launched in UK and Ireland

• High profile brand presence for Awards season

• New content including: NBALive and TED talks

• Innovation Lab launched in Barcelona

• New Group partnership with Coca-Cola Company

Estate development:

• New cinema opened in Orpington, UK

• Pipeline of new sites for 2016 and 2017 including:

Oldham, Bournemouth, new Lounge in Islington Square

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QUESTIONS

AND ANSWERS

7 Further questions can be addressed to:

[email protected]

Financial PR:

[email protected]

2015 q4 investor presentation

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