VRL GROUP Disclaimer. Results commentary for the year ended 30 June

Transcription

1 Results Commentary For the year ended 30 June 2012

2 VRL GROUP Disclaimer Non IFRS Financial i Information The VRL group results are prepared under Australian Accounting Standards, and also comply with International Financial Reporting Standards ( IFRS ). This presentation includes certain non- IFRS measures including EBITDA and operating profit excluding material items of income and expense and discontinued operations. These measures are used internally by management to assess the performance of the business, make decisions on the allocation of resources and assess operational performance. Non-IFRS measures have not been subject to audit or review, however all items used to calculate l these non-ifrs measures have been derived d from information used in the preparation of the audited or audit-reviewed (as applicable) financial statements. It is noted that the audit of the financial statements for the year ended 30 June 2012 is still in the process of being completed. Included in the ASX Appendix 4E (page 10) is a Reconciliation of Results which provides further detail on the Non-IFRS financial information contained in this presentation. 2

3 VRL Group Financial summary FY2012 FY2011 FY2010 FY2009 Earnings per share (before material items and discontinued operations / ordinary shares) (cents) (1) Dividends per share (ordinary shares) (cents) (2) Net Profit After Tax - operating (before material items, discontinued operations) $52.8m $31.3m $35.0m $25.1m EBITDA (before material items, discontinued operations) $154.7m $140.5m $147.0m $127.9m Net Cashflow from Operating Activities (3) $125.9m $149.8m $206.0m $187.6m Net on balance sheet debt (4) $254.0m $53.5m $827.1m $899.9m Note 1: Diluted EPS for FY2012, Total EPS up to FY2011 Note 2: Excludes distributions and special dividends Note 3: FY2011 and prior years includes operating cashflows from discontinued operations Note 4: Shareholder distribution of $151million paid in July 2011, comprising $30 million capital reduction and $121 million fully franked distribution 3

4 VRL GROUP Results by Division Operating Results Reported EBIT Reported EBITDA For the year ended 30 Jun 30 Jun 30 Jun 30 Jun 30 Jun 30 Jun $ m $ m $ m $ m $ m $ m THEME PARKS : GOLD COAST THEME PARKS : US WATER PARKS (0.8) (2.1) CINEMA EXHIBITION : AUSTRALIA CINEMA EXHIBITION : OTHER FILM DISTRIBUTION CORPORATE/OTHER (29.0) (47.8) (37.2) (46.9) (34.6) (43.6) REPORTED RESULTS Note: Excludes Material items and Discontinued operations, please refer to page 10 in the ASX Appendix 4E for further details. 4

5 VRL GROUP Operating Cashflow For the year ended 30 June 2012 EBITDA $ m Movement in Working Capital $ m Interest/ Tax $ m Operating Cash Flow $ m Capital Expenditure $ m Free Cash Flow $ m THEME PARKS (22.2) CINEMA EXHIBITION (4.0) FILM DISTRIBUTION 50.8 (6.2) (6.5) CORPORATE/OTHER (34.6) (8.4) 12.3 (30.7) 9.1 (39.8) TOTAL (8.4) (20.4)

6 VRL GROUP Group Debt ON BALANCE SHEET Facility Expiry Calendar Year Total Debt Drawn ($m) 30 Jun 2012 Total Debt Drawn ($m) 30 Jun 2011 THEME PARKS : GOLD COAST 2 nd half THEME PARKS : US WATER PARKS 1 st half 2029/ 1 st half CINEMA EXHIBTION : AUSTRALIA 2 nd half FILM DISTRIBUTION 1 st half CORPORATE / OTHER (1) 1 st half TOTAL ON BALANCE SHEET DEBT Cash on Hand (2) (193.5) (431.7) NET DEBT ON BALANCE SHEET Note 1: This $100 million facility is currently undrawn. Note 2: Major non-operating cash outflows for year included $151.5m shareholder distribution and $62.1m tax payment resulting from the sale of Austereo 6

7 VRL GROUP Group Debt ON BALANCE SHEET DEBT CURRENT 30 June 2012 ($m) THEME PARKS 23.3 CINEMA EXHIBITION : AUSTRALIA 4.8 FILM DISTRIBUTION 6.9 CORPORATE/OTHER (1) - Total Current Debt on Balance Sheet 35.0 ON BALANCE SHEET DEBT NON CURRENT 30 June 2012 ($m) THEME PARKS CINEMA EXHIBITION : AUSTRALIA 58.0 FILM DISTRIBUTION 87.5 CORPORATE/OTHER (1) - Total Non Current Debt on Balance Sheet Note 1: This $100 million facility is currently undrawn 7

8 VRL GROUP Group Debt DEBT AND INTEREST COVER BY DIVISION JUNE 2012 Net Debt/ EBITDA (times) EBITDA/Net Interest (times) THEME PARKS : GOLD COAST CINEMA EXHIBITION : AUSTRALIA FILM DISTRIBUTION TOTAL VRL GROUP

9 THEME PARKS

10 THEME PARKS Summary of Results Reported EBITDA Operating Results RESULTS ANALYSIS For the year ended 30 June 2012 ($m) 30 June 2011 ($m) 30 June 2012 ($m) 30 June 2011 ($m) Gold Coast Theme Parks USA Water Parks (0.8) (2.1) TOTAL

11 THEME PARKS Gold Coast - Results For the year ended 30 June June 2011 (m) (m) TOTAL ATTENDANCE (m) SALES REVENUE $258.1 $259.7 OTHER REVENUE $1.0 $0.6 TOTAL EXPENSES $177.1 $177.5 EBITDA $82.0 $82.8 DEPRECIATION AND AMORTISATION (1) $30.5 $28.5 INTEREST EXPENSE (NET) $22.2 $21.1 NET PROFIT BEFORE TAX $29.3 $33.2 TOTAL CAPEX $42.6 $36.2 Note 1: Increase in depreciation and amortisation expense as a result of charges from capital investment made in new attractions to drive attendance. 11

12 THEME PARKS Gold Coast - Trading Latter part of January school holidays and extended April / Easter school holidays impacted by wet weather effecting all parks and especially Wet n Wild Focus on the sales of Season ( VIP ) Pass, admission yields and expense control Season Pass ( VIP ) best ever launch for 2013 Pro-active management of ticketing combinations Ability to offer multi-park passes enables capture of significant market share; drives ticket yields and drives attendance to parks resulting in a boost to in-park revenues 12

13 THEME PARKS Gold Coast - Trading Investment of over $40 million in new attractions in FY2012 putting VRL in great shape for the years ahead Green Lantern steel coaster at Warner Bros. Movie World Nickelodeon Parade at Sea World Nickelodeon Splash Bash at Sea World Resort and Water Park Australian Outback Spectacular: Spirit it of the Horse Arkham Asylum at Warner Bros. Movie World Oxenford acres freehold; Sea World - 72 acres; lease 45 years 13

14 THEME PARKS Gold Coast - Outlook Forecast capital spend for FY2013 $25m-$30m Results of the 2013 pre-season VIP sales campaign outstanding Campaign was anchored by: Family VIP pass offer Recent and upcoming new attractions Justice League, Alien Invasion Constrictor Water Slide Dinosaur Island Warner Bros. Movie World Wet n Wild Sea World Opening September 2012 Opening September 2012 Opened July

15 THEME PARKS USA Water Parks - Results For the year ended d 30 June June 2011 (m) (m) TOTAL ATTENDANCE (m) SALES REVENUE $ TOTAL EXPENSES $14.2 $15.1 EBITDA $5.4 $4.4 DEPRECIATION AND AMORTISATION $3.1 $3.2 INTEREST EXPENSE (NET) $3.1 $3.3 NET PROFIT BEFORE TAX $(0.8) $(2.1) TOTAL CAPEX $2.6 $1.9 15

16 THEME PARKS USA Water Parks Wet n Wild Phoenix Continued growth EBITDA up 11.8% on prior year Anchored by opening of new Constrictor slide New dedicated Wet n Wild Junior, themed area dedicated to children aged 3 to 7 years. Disciplined approach to expense control Wet n Wild Hawaii Outstanding season pass campaign, Buy one day and get the rest of 2012 for free Greater focus on labour and expense control 16

17 THEME PARKS New Opportunities Wet n Wild Sydney VRL firmly believes this will be the best water park in the world when it opens to the public in December 2013 Construction has started - expected capital budget $110m - $120m 50 year lease The marketing of the park will highlight the state of the art attractions unique to Wet n Wild Sydney: Spectacular ride complexes Surf pool and Wave pool Lazy / Adventure River High ride capacity to enhance customer enjoyment 17

18 THEME PARKS New Opportunities China Theme Parks Continuing to explore opportunities Wet n Wild Wild Currently negotiating new Wet n Wild water park in the USA - majority ownership and management agreement Continuing to focus on the development and expansion of the brand Iconic branding within International water parks industry VRL owns the rights to the brand in Australia, parts Asia and most of USA 18

19 CINEMA EXHIBITION

20 CINEMA EXHIBITION Results For the year ended 30 June June 2011 (m) (m) TOTAL PAID ADMISSIONS - AUSTRALIA SALES REVENUE $232.5 $223.4 OTHER REVENUE $18.8 $19.0 TOTAL EXPENSES $203.2 $197.5 EBITDA $48.1 $44.9 EBITDA EXHIBITION OTHER (note 1) $3.0 $1.5 EBITDA $51.1 $46.4 DEPRECIATION AND AMORTISATION $13.0 $12.4 INTEREST EXPENSE (NET) $4.1 $5.7 NET PROFIT BEFORE TAX $34.0 $28.3 TOTAL CAPEX $11.9 $20.5 Note 1: Exhibition other includes the overseas exhibition territories (USA, Singapore and UK) and the Intencity games business. 20

21 CINEMA EXHIBITION Australia - Trading Box office 2 nd all time record, driven by outstanding product, higher average ticket prices Gold Class admissions up 6% on prior year $max brand expanded with additional screens at Indooroopilly, QLD and Tuggerah, NSW Outstanding franchise product during the year; driving admissions Harry Potter And The Deathly Hallows: Part 2 Avengers Transformers 3 The Hunger Games Twilight 21

22 CINEMA EXHIBITION Australia - Trading Digital 100% conversion to digital screens first major exhibitor in Australia Alternative Content Alternative content success during the year with: Phantom Of The Opera Pearl Jam Chemical Brothers Strategy will continue into FY2013 with calendar of events to lift admissions on low yield nights 22

23 CINEMA EXHIBITION Australia - Outlook Upcoming outstanding line-up of new releases Gangster Squad The Hobbit Bond Skyfall Refurbishments Re-developed Toombul site in Queensland opening beginning FY2013 Focus on additional Gold Class and $max Forecast capital expenditure $15m - $20m FY

24 CINEMA EXHIBITION Other - Trading US Gold Class Results in line with expectations New site during the year Boca Raton, Florida Construction started Wilshire Boulevard, Westwood, LA Singapore New site at Katong Mall opened December 2011, performed above expectations Belfast Trading as expected in a difficult economic environment 24

25 FILM DISTRIBUTION

26 FILM DISTRIBUTION Results For the year ended 30 June June 2011 (m) (m) SALES REVENUE $387.3 $389.9 OTHER REVENUE $1.2 $2.0 TOTAL EXPENSES $337.7 $341.4 EBITDA $50.8 $50.5 DEPRECIATION AND AMORTISATION (1) $2.8 $6.9 INTEREST EXPENSE (NET) $6.5 $8.1 NET PROFIT BEFORE TAX $41.5 $35.55 Note 1: The reduction in depreciation and amortisation is due to the end of life of the fair value film royalty recognised on consolidation of the remaining 50% of this entity 26

27 FILM DISTRIBUTION Trading Leading theatrical distributor with market share of 26.5% Number one DVD distributor with market share 16.6% Warner Bros, key supplier with 15 films, including Harry Potter And The Deathly Hallows Part 2, biggest all time Australian Box Office $52.6 million. Red Dog, Box Office $21.4 million, 3 rd biggest DVD of all time Stand out Home Entertainment product and campaigns include, Sherlock Holmes 2: A Game Of Shadows, The Inbetweeners and The Girl Who Kicked The Hornets Nest Strong TV titles included, Channel 9 s Underbelly 4: Razor, Hamish and Andy s Gap Year and 20 th Anniversary boxed set for The Wiggles Digital sales growth driven by increased sales through itunes 27

28 FILM DISTRIBUTION Outlook Secured future sequels of The Hunger Games through an output deal with Lionsgate Australian titles Kath & Kimderella and Goddess Licencing renewals secured for key suppliers including BBC and ABC Ongoing g growth in Digital as more digital channels become more active in the market Upcoming theatrical releases include: Man Of Steel The Hobbit Gangster Squad 28

29 FILM PRODUCTION & MUSIC

30 FILM PRODUCTION & MUSIC Restructure US$275 million new long term mezzanine debt and equity deal Increase in film equity base, access to debt facility Increase output of films from 3-4 to 6-8 per annum Generate producer fee cashflow and increase risk diversity Increase numbers of films for Australian distribution Simplification of equity structure, VRL ownership 47.6% of ordinary equity US$100 million redeemable non-voting shares Subject to film performance criteria 5% cash interest plus 9% accruing interest 2018 maturity date, amortisation from 2015 Ranks alongside new monies (except in default) Value of redeemable shares at par 66cps (VRL shares) plus 47.6% ordinary equity Book value of asset is nil due to equity accounting 30

31 FILM PRODUCTION & MUSIC Cash on hand US$113 million Film Production Level of bank debt drawn US$870 million Moody s credit rating of the debt facility is A2 based upon a maximum 75% advance ratio of released films Music Level of bank debt drawn US$85 million Secured against music library; valued annually 31

32 FILM PRODUCTION & MUSIC Upcoming Releases Gangster Squad starring Sean Penn, Ryan Gosling, Emma Stone and Josh Brolin The Great Gatsby starring Leonardo DiCaprio and directed by Baz Luhrmann All You Need Is Kill starring Tom Cruise and Emily Blunt, directed by Doug Liman Lego directed by Phil Lord and Chris Miller Fury Road (Mad Max) starring Tom Hardy and Charlize Theron and directed by George Miller 32

33 FILM PRODUCTION & MUSIC Concord Music & VREG Asia Concord Music New title from Sir Paul McCartney Kisses On The Bottom Follow up recording of 2011 Best New Artist Grammy winner Esperanza Spalding, Radio Music Society New releases from diverse array of artists coming this fall VREG Asia Upcoming titles include: Journey To The West Man Of Tai Chi 33

34 CORPORATE

35 CORPORATE Corporate Governance Committee Newly formed, members all independent directors Cost Reductions Corporate overhead costs down on FY2011 Interest cost down on FY2011 Further cost reductions anticipated Development Costs Development costs of $3.0m relating to Sydney Wet n Wild and China Theme Parks growth initiativesiti 35

36 VRL GROUP Summary Continuing Businesses Growth Growth in earnings Stable cashflows Cash reserves and low net debt Focus on cost reduction Wet n Wild Sydney construction commenced New Wet n Wild development in the USA Development of digital opportunities Edge Loyalty Systems Chinese film portfolio 36

37 VRL GROUP Summary Outstanding film product line up near record year for our theatres Theme parks - Weather Impacted Cost control Film Distribution and Film Production scoring great success across our portfolio of product People want entertainment, escape and love to go out we are servicing this very real demand Growth potential in all divisions 37