interim results 2011 - ir ppt - final 2 interim results.pdf · microsoft powerpoint - interim...
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2011 Interim Results9 August 2011
i-CABLEii--CABLECABLECommunications Communications LimitedLimited
Results Highlights
• Efforts to rebuild revenue & profitability have started to pay off
Ø TV subscriber base sustainable, making healthy contributions to recurrent revenue driven by strong content & new services
Ø Advertising revenue remained strong, attributed mainly to a stronger economy, attractive programming across flagship platforms & more effective marketing
• Increase in programming costs and lower Broadband turnover adversely affected performance & slowed the return to profitability
• Net loss position has substantially improved in the first half
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Television
• Higher recurrent revenue created noticeable improvement in financial performance
• Successful marketing & promotional campaigns maximized the leverage of prized content & strong HD service
• Continue to invest in premier content to reinforce & expand market share under well-tested strategy
• Strengthen & improve the attractiveness of packages to meet customers' fast-changing needs & fast-evolving electronic entertainment landscape on the Internet via both fixed & mobile platforms
Subscription Services
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• The best HD quality & viewing experience in town is the biggest draw card for customer acquisition together with premier contentacross flagship channels
• Expanded the spectrum of genres on HD platform to 9 flagship HD channels:
Ø 5 HD Sports channels
Ø 3 HD Movie channels
Ø 1 HD Entertainment channel
Expanded HDTV Offerings
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HD Sports (HD200 HD Sports (HD200 –– HD204)HD204)• Barclays Premier League• UEFA Champions League• German Bundesliga• Copa America • Barclays Asia Trophy• ATP Qatar Open Tennis • Asian Winter Games• The Sudirman Cup• FINA Swimming World Championships• HD Horse racing
Expanded HDTV Offerings
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HD Olympics 2012HD Olympics 2012• Preparing for London Games available exclusively
on i-CABLE in unprecedented coverage• Started 1-year countdown with daily footages
recapping the unforgettable moments from the Beijing Olympics
Cine p. (HD245)Cine p. (HD245)
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Expanded HDTV Offerings
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• A brand new movie channel, with award-winning & controversial titles for a mature audience
• A wide range of genres, many of which not theatrically released or first run on TV in Hong Kong
• Broadcast in original uncut, unrated versions that cannot be exhibited on Free TV
• No additional fee for basic pack subscribers
HMC 1 (HD243)HMC 1 (HD243)
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Expanded HDTV Offerings
• Available in HD starting from 30 June 2011
• A 24-hour non-stop Hollywood movie channel featuring action adventure mega hits
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Expanded HDTV Offerings
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Entertainment Channel (HD212)Entertainment Channel (HD212)• Features popular drama series as
well as repackaged game & variety shows, music & artistes features & hottest talkshows
• A 24-hour local movie channel with first run blockbusters
Movie 1 (HD241)Movie 1 (HD241)
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Self-Produced Programmes
Self-Produced Programmes
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• CABLE TV viewership share bigger than all other Pay TV combined• CABLE TV viewership share continued to gain ground – at the expense
of the closest rival which lost nearly 20% in the past two years
Viewership
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Source: CSM Media ResearchAll Day All Time (Individual 4+)
52%
46%
42%
34%
10% 9%
2%4%
Subscribers
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1,101,000 1,103,000
228,000 225,000
143,000 137,000
Dec 2010 Jun 2011
Broadband
• Despite competition pressure, we are speeding up network investment to slow down subscriber loss & protect market share
• Next generation DOCSIS 3.0 roll-out on HK Island completed; works for Kowloon & New Territory currently underway in earnest
• Expansion in network capacity & improvement in service quality would help stem subscriber attrition & protect revenue through upselling to existing subscribers
Subscription Services
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Newsline Express
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• A strong brand taking advantage of MTR's extensive rail network & CABLE TV's leading news offering
• A massive platform reaching 1.6 million passengers each day on board trains of MTR East Rail, West Rail & Ma On Shan Lines*
* Synovate AsiaBUS
• Firmly established itself as a discerning production & distribution company
• Released 3 titles theatrically in the first half of 2011, with 9 titles in the pipeline
• The King‘s Speech (皇上無話兒)Ø A major box office & critical
success both locally & around the world
• My Ex-wife’s Wedding (翻叮我老婆)
• Scream 4 (奪命狂呼 4)
Sundream Motion Pictures
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Television
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• Higher recurrent revenue mainly attributable to increase in higher yield subscriptions
• Advertising revenue remained strong, attributed mainly to a strong economy, attractive programming across platforms & more effective marketing
2011HK$M 1H 2H 1H vs 1H10Turnover 725 836 874 20%Opex before dep’n (748) (876) (822) 10%EBITDA (23) (40) 51 N/ADepreciation (79) (80) (74) - 6%Operating Profit/(Loss) (102) (120) (22) - 78%
EBITDA Margin -3% -5% 6%Operating Margin -14% -14% -3%
2010
Internet & Multimedia
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• Price wars lowered turnover & subscribers• Speed up DOCSIS 3.0 rollout to protect subscriber base with service
& infrastructure improvements
2011HK$M 1H 2H 1H vs 1H10Turnover 231 201 167 - 28%Opex before dep’n (133) (116) (98) - 26%EBITDA 98 86 70 - 29%Depreciation (44) (44) (39) - 10%Operating Profit 55 42 30 - 44%
EBITDA Margin 43% 43% 42%Operating Margin 24% 21% 18%
2010
Consolidated Results
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• Net loss position substantially improved & back to positive EBITDA• Broadband competition & high programming costs slowed the return
to profitability
2011HK$M 1H 2H 1H vs 1H10Turnover 962 1,040 1,051 9%Opex before dep’n (944) (1,053) (983) 4%EBITDA 18 (13) 68 275%Depreciation (126) (127) (117) - 8%Operating Profit/(Loss) (108) (140) (49) - 55%Share of profit less losses ofassociates (39) (2) - N/ANet interest income & others 1 (2) (2) N/ALoss before taxation (146) (144) (51) - 65%Taxation 1 23 (4) N/ANet Profit/(Loss) (145) (121) (55) - 62%
2010
Operating Expenses
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• Premier programming costs remained high but attracting high yield subscribers with upselling opportunities
2011HK$M 1H 2H 1H vs 1H10Programming 546 728 637 17%Network 119 115 113 - 5%Selling, CS, G&A 250 185 189 - 24%Cost of Sales 29 26 45 53%Sub-total 944 1,053 983 4%Depreciation 126 127 117 - 8%Total 1,070 1,180 1,100 3%
2010
• Investing in & for the future is the Group's long-standing & well-proven strategy. It includes service offerings, customer service as well as infrastructure to enrich customers' experience & satisfaction
• Competitive pressure is not expected to ease, we are cautiously optimistic that the renewed growth momentum is solid & will be reflected in financial performance in due course
• The free TV landscape is about to undergo revolutionary change with the Government considering three applications for new licences. The imminent introduction of many channels in Hong Kong looks set to pose challenges to both free & pay TV operators, the full implications of which remain to be seen
• The Group awaits the award of a Free TV licence to Fantastic Television to enable the Group to tap new revenue, leveraging on its content & infrastructure advantage
• Handheld devices are a new agent for drastic change. This development presents both opportunities & threats and the Group is keen to unlock & exploit any possible potential for new market share & business growth
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Outlook
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i-CABLE Communications LimitedHKSE Stock Code: 1097.HK
DisclaimerAll information and data are provided for information purposes only. All opinions included herein constitute i-CABLE’s judgement as of the date hereof and are subject to change without notice. i-CABLE and its subsidiaries and affiliates hereby disclaim (i) all express, implied, and statutory warranties of any kind to user and/or any third party including warranties as to accuracy, timeliness, completeness, or fitness for any particular purpose; and (ii) any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the information and data contained herein.