9 m15 results
TRANSCRIPT
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Marzo 2014
9M 2015 Results
October 2015
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Operating structure
Note: The percentages of control are updated as of 30 September and are calculated net of treasury shares
€644 m €1.35 Bio €392 m
All Media sectors from
dailies and periodicals
to radio, Internet, and
advertising
Global automotive
components supplier
(filters, air &cooling and
suspensions)
Nursing homes,
rehabilitation and
hospital management
Private equity
Revenues
2014
Businesses
Competitive
position
Leader in circulation of Italian dailies
N.1 news magazine
N.1 Italian information website
Third Italian radio network
Leader in its core
businesses (filters and
suspensions) in
Europe and South
America
--
Leader in Italian long
term care (nursing
homes and
rehabilitation)
Non-core investments
56.4% 57.6% 51.3%
Total € 2.4 Bio
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• Founded in 1976 by Carlo De Benedetti; controlled (45.8%) by COFIDE-Gruppo
De Benedetti
• Long term investment strategy, with focus on controlling stakes
• Balanced portfolio of assets, with leading positions in their respective
businesses
• Active role in governance and in strategic decision making of portfolio
companies
• No leverage and significant liquidity available at holding company level
• Commitment to low cost structure
CIR Group profile
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• Consolidated net income: € 39.6 million (vs. € 5.4 million in 9M 2014).
Contribution of industrial businesses (Espresso, Sogefi and KOS) is + € 25.0
million, vs. € 4.4 million in 9M 2014
• Consolidated net financial position of the CIR Group at September 30, 2015:
- € 202.9 million (vs. - €112.8 million at December 31, 2014), including:
- A net financial surplus at holding level of €360.2 million (decreasing vs.
€379.5 million at December 31, 2014 due mainly to share buyback)
- A net debt of consolidated subsidiaries of - €563.1 million (increasing vs.
- €492.3 at December 31, 2014 due mainly to new investments and
KOS acquisitions)
9M 2015 consolidated financial highlights
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Consolidated income statement
Group net result 5.4 39.6
€ m
Income taxes (25.0) (25.9)
(41.4) Financial expense/income (6.7)
83.4
9M 2014 9M 2015
EBIT
EBITDA 154.4 174.4
96.7
Revenues 1,771.2 1,897.4
Loss on assets held for sale (5.3) (0.1)
(1) Restated following the application of IFRS5
(2)
(2) Net of third party interests (equal to €24.4 million in 9M 2015)
(1)
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Consolidated income statement by business sector
€ m
(2) Including Treasury and non core investments
9M 2014 9M 2015
CIR holding level 1.1 14.6
Net result 5.4 39.6
(2)
5.2 KOS Group 6.8
(3.3) Sogefi Group
Espresso Group 2.5 13.9
4.3
4.3 Total industrial companies 25.0 (1)
(1) Pro-rata share of subsidiaries’ net income
(0.1) Sorgenia Group --
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Consolidated balance sheet – main group assets
€ m
Group equity in consolidated balance sheet 31 Dec. 2014 30 Sept. 2015
129.5 KOS 133.4
95.1 Sogefi
Espresso 347.9 365.1
102.0
(2) Including SEG and other Education businesses; Cir Ventures; other minor
Fixed assets 18.1 17.8
572.5 Total industrial companies 600.5
Non performing Loans 49.3 43.8
Private equity 67.7 62.3
Other investments 33.9 33.1
Other assets/liabilities
Net cash
(16.5)
379.5
(11.7)
360.2
(1)
1,104.5 1,106.0 Consolidated shareholders’equity
532.0 Total CIR and non industrial companies 505.5
(1) Book value decreasing due to cash reimbursements to CIR
(2)
(1)
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Consolidated net financial position
€ m
31 Dec. 2014 30 Sept. 2015
(157.0) KOS Group (218.3)
(304.3)
CIR holding level 379.5 360.2
Sogefi Group
Espresso Group (34.2) (8.1)
(339.7)
(492.3) Total subsidiaries (563.1)
Consolidated net financial indebtedness (112.8) (202.9)
3.2 Other subsidiaries 3.0
Total shareholders’ equity 1,573.2 1,591.6
Consolidated net invested capital 1,686.0 1,794.5
(1) Including third party interests
(1)
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• Decrease of net cash at holding system level is mainly due to purchases of
treasury shares
Net financial position at “holding system” level
Evolution of net financial position as at 30 September 2015
(1)
(1) Fair value of securities + securities income, trading
(2) Operating costs, extraordinary costs, taxes, etc.
(2)
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Composition of liquid assets and gross financial debt
Liquid assets at 30 September 2015
€ m
Hedge funds
Other (stocks, equity funds)
382.1
96.0
95.1
30.1
360.5
45.8
11.3
31 Dec.
2014
30 Sept.
2015
Cash and time deposits
Corporate bonds
Government bonds
57.9
5.7
59.2
43.2
4.2
99.3
Total liquid assets
31 Dec.
2014
30 Sept.
2015
2.6 0.3 Gross financial debt
Other debt 2.6 0.3
Fixed income funds 94.0 196.8
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9M 2015 Subsidiaries’ financial and operational highlights
Key strategic objectives 9M 2015 Highlights
Expansion of digital platforms, leveraging on
leadership in traditional media
Further efficiency improvement
Further consolidation in Italian nursing and
rehabilitation
Geographical expansion (India)
Completion of global footprint, through growth in
non-European countries
Further efficiency improvement and restructuring of
manufacturing footprint
Product innovation
Decrease of press circulation (-5.6%) and total advertising revenues (-4.4%), although at lower rates than the market; internet (+2.8%) and radio (+6.1%) advertising showed positive dynamics.
In such challenging market, Espresso reported positive net results and stable EBITDA, thanks to continuing focus on efficiency improvement, and decreasing net debt (€8.1 m vs. €34.2m at 4Q2014), thanks to operating cash flow and divestiture of TV assets.
La Repubblica and Repubblica.it confirm their leadership respectively in daily newspaper newsstand sales/readership and news sites unique users rankings
Espresso
Sogefi
KOS
Selective growth in emerging industry sectors, with
international focus Non-core
investments
Positive performance of Education business
Continuing growth of revenues (+12.6%) and EBITDA (+20.8%) thanks
to ongoing organic and external growth
Revenues growth of 11.5% (+8.7% at constant exchange rates):
- Positive performance in Europe (+9.3%); double digit growth in North
America (+23.2%) and Asia (+31.1%);
- Slight decrease in Latin America (-0.7%) despite market slowdown
Improving EBITDA (+13.1%) and +7.4m net income (vs. -5,8m loss in
9M2014), thanks to higher volumes, lower restructuring costs and lower
financial expenses
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Espresso - overview
9M 2015 Revenues breakdown
NATIONAL PRESS
DIGITAL
ADVERTISING
National daily newspaper
18 Regional newspapers throughout Italy
Group websites
Three national radio stations
LOCAL
NEWSPAPERS
RADIO
Collection of advertising
€ m
9M 2014 9M 2015
Revenues 465.8 439.6
Net income 4.6 24.6
EBITDA 41.8 40.9
Key financials Operating structure
9M 2015 Performance and outlook
• Circulation revenues at € 166.0 million, decreasing by 5.6%, in a
market down 9.4%. Total advertising revenues were down 4.4%:
radio and the internet grew respectively by 6.1% and 2.8% while
printed press was in line with the negative trend of the market
• EBITDA was in line with last year as a result of continuing action
on costs, which were reduced by 6.6%, more than revenue
contraction
• Increase in net income was due not only to the capital gain of €
9.5 million related to the sale of Deejay TV to Discovery Italy but
also to the results of the core business, to the reorganization of
the television business and to lower financial expenses and tax
charges
• As for the FY 2015 outlook, performance of Espresso’s media is
expected to be less negative than that of the overall advertising
market and net result is expected to be better than previous year
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Sogefi - overview
Revenues 1,010.2 1,126.6
Net result (5.8) 7.4
EBITDA 80.8 91.3
Key financials € m
9M 2014 9M 2015
• 11.5% revenues growth (+8.7% at constant exchange
rates), due to higher volumes in all geographical areas,
with the exception of Latin America. Revenues grew by
9.3% in Europe, by 23.2% in North America, by 31.1% in
Asia; -0.7% in South America
• Net income benefited from higher volumes and decrease
of net financial expenses
• For the rest of 2015 Sogefi expects to continue on
positive trends in North America and Europe; further
growth is expected in China and India, while in South
America market conditions remain difficult
9M 2015 Performance and outlook
FORD
FCA
RENAULT/NISSAN
PSA
DAIMLER
GM
VOLKSWAGEN/AUDI
BMW
TOYOTA
Revenues breakdown (9M 2015)
OTHERS (including
Aftermarket)
13.1% 12.0%
11.3%
11.8%
7.7% 7.4%
3.4%
2.8%
2.1%
28.2%
Europe
North America
South America
63.7%
17.0%
12.0%
7.0% 0.3%
Weight of non-
European
markets
36.3%
Countries Customers
Asia Others
SUSPENSIONS FILTRATION AIR & COOLING
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KOS - overview
€ m 2011 2012
Revenues 289.7 326.3
Net income 10.1 13.3
EBITDA 44.2 53.4
Key financials
SHAREHOLDERS
HOSPITAL
MANAGEMENT NURSING HOMES REHABILITATION
CIR (51.3%)
ARDIAN (46.7%)
Management and others (2.0%)
Operating structure
9M 2014 9M 2015
5.2
2.3
5.7
10.2
36.6
114.3 7.6 23.5
45.4
107.1
18.8
Revenues breakdown by region (2014)
4.5
• Increase in revenues (+12.6%), thanks to relevant acquisitions
in the nursing home/rehabilitation area and to organic growth
across all businesses lines.
• Contributions to EBITDA increase were:
- €1.5 million from revenue growth and efficiency
improvement, at constant 2013 perimeter
- €7.7 million from 2014 and 2015 acquisitions and
greenfields
• In October 2015 a new nursing home was started in Turin
• The company now has 77 nursing homes in the centre and
north of Italy with more than 7,300 beds
• Main objectives are to pursue market consolidation in core
businesses and to selectively expand internationally, with a
primary focus on India
9M 2015 Performance and outlook
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• Education
- CIR has an interest of 17.4% in SEG (Swiss Education Group), a world
leader in education for hospitality management (hotels, restaurants, etc.).
The book value of the investment at 30 September, 2015 was €22.0 million
- On 26 October, 2015 CIR signed an agreement with a group of investors
concerning the sale of its 17.4% shareholding in SEG, for a total
consideration of € 64.1 million, a capital gain on investment of € 45,5 million,
and an IRR of 30%. The closing of the deal is expected by end November
• Private equity
- Diversified portfolio of private equity funds and direct minority private equity
investments, with a fair value of € 62.3 million at 30 September, 2015. The
portfolio has reached its maturity/reimbursement phase, as limited
investments were added in the recent past
• NPL
- At the end of September 2015 the net value of CIR investment in the non-
performing loan portfolios amounted to €43.8 million.
- CIR no longer owns operating companies in this industry and is currently in
the process of collecting the existing receivables, with no further investments
Non-core investments
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• This document has been prepared by CIR for information purposes only and for use
in presentations of the Group’s results and strategies.
• For further details on CIR and its Group, reference should be made to publicly
available information, including the Annual Report, the Semi-Annual and Quarterly
Reports
• Statements contained in this document, particularly the ones regarding any CIR
Group possible or assumed future performance, are or may be forward looking
statements and in this respect they involve some risks and uncertainties
• Any reference to past performance of CIR Group shall not be taken as an indication
of future performance
• This document does not constitute an offer or invitation to purchase or subscribe for
any shares and no part of it shall form the basis of or be relied upon in connection
with any contract or commitment whatsoever
Disclaimer
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