NRJ GROUP (EPA:NRG) - NRJ Group - Half year results 2019

Transparency directive : regulatory news

25/07/2019 17:53

Paris, July, 25 2019 - 5.45pm
2019 half-year results - NRJ Group

       - Strengthened radio leadership in France for the 25-49 age group
          - All-time audience highs in June for the TV division
   - Sustained investments concentrated in the first half of the year impacted
                                  results
                     - Solid financial structure

The NRJ Group Board of Directors which met on July 25, 2019, approved the
half-year financial statements for 2019.

In millions of euros HY 2019(i) IFRS 16  H1 2019 without  H1 2018  Comparable
                               incidence IFRS16 incidence            Change
Revenue excluding
barters                192.6                 192.6         193.2     -0.3%
EBITDA ii excluding
barters                 25.6      4.1         21.5          27.1    -20.7%
Current operating
profit excluding
barters                 10.6      0.1         10.5          17.0    -38.2%
Operating profit         8.9      0.1          8.8          17.0    -48.2%
Net profit Group share   3.9      0.0          3.9          11.3    -65.5%

In millions of euros As at June 30, IFRS 16  As at June 30,   As at Dec 31,
                       2019 (i)    incidence 2019 without         2018
                                            IFRS16 incidence
Net cash surplus iii     160.7        (33.1)    193.8             198.6
Shareholders'equity
Group share              587.3          0.0     587.3             598.2

Comparable Change
-2.4%
-1.8%

(i) For the first time, the accounts for the first half of 2019 were drawn up
in accordance with the IFRS 16 Leases standard (use of the simplified
retrospective approach, without reprocessing the previous financial year's
figures).

For NRJ Group, the first half of 2019 was characterised by:

* Good audience figures in both radio and television, with strengthened
   Radio leadership in France for the 25-49 age group and all-time highs
   recorded in June for the TV division,
* Consolidated revenue(1) of EUR192.6 million, which was stable compared to
   the first half of 2018,
* Higher expenses projected in 2019 concentrated in the first half, due to
   sustained investments in radio programmes, their promotion in France and
   internationally (both paid for and as exchanges), and the continued
   development of towerCast.

This is in line with the outlook announced by the Group when the 2018 annual
results were published.

On June 30th 2019, the Group posted a net cash surplusiii of EUR193.8 million
which, after applying the IFRS 16 standard and deducting EUR33.1 million in
lease liabilities, amounts to EUR160.7 million.

The Group generated EUR12.6 million in free cash flowv during the first half
of 2019 (including a EUR4.6 million increase due to applying the IFRS 16
standard).

Revenue and current operating profit (excluding barters) by activity

In millions of euros HY 2019  ,HY 2018 Change

Radio                 112.5      111.7     +0.7%
Television             45.3       47.5     -4.6%
Broadcasting           34.8       34.0     +2.4%
Revenue excluding
barters               192.6      193.2     -0.3%
Radio                  11.4       14.6    -21.9%
Television             (8.0)      (8.8)    +9.1%
Broadcasting            8.5       11.2    -24.1%
Other activities       (1.3)       0.0      N.A.
Current operating
profit excluding
barters(i)             10.6       17.0    -37.6%

(i) For the first time, the accounts for the first half of 2019 were drawn up
in accordance with the IFRS 16 Leases standard (use of the simplified
retrospective approach, without reprocessing the previous financial year's
figures).

                                     RADIO

In the first half of 2019, the Radio division generated revenue(1) of EUR112.5
million, a 0.7% increase compared to the first half of 2018. Growth in
activities was seen both in France and internationally.

With the new Médiamétrie results from the April-June 2019 wave, the Group's
national sales house strengthened its leadership in the advertisers' high
commercial priority targets: the 25-49 age group,(2) and asserted its position
as the number one radio offering in France for both Women Under 50 Responsible
for Purchases(2) and for Millennials.(2)

NRJ is France's number 1 radio station for listeners in the under-65 age
group.(3) NRJ's performance also validates the Group's strategy of introducing,
for the first time in its history and at the start of the 2018-2019 season, an
entertaining and interactive programme for its listeners during the 5-8pm time
slot hosted by 'Cauet et sa bande'. Given the audience success recorded (+32%
in audience share in 1 year(4)), the Group will extend the programme by an
extra hour next season, meaning it will begin at 4pm.

In the first half of 2019, digital activities reported a 25% increase in
revenue.(1) This growth was driven by the Group's entire digital ecosystem,
which cemented its position as the number one private group for Internet
radio(5) in June 2019 and as the radio group most listened to on smart speakers
for its four radio brands, with 65% of the internet users who use smart
speakers listening to them.(6)

The EUR0.8 million growth in revenue(1) was nevertheless unable to compensate
the EUR4.0 million increase in expenses in the first half of the year. The two
national communication campaigns launched at the start of the year to promote
NRJ's two flagship programmes ('Manu dans le 6/9' and 'C'Cauet') and the
increase in expenses in Sweden linked to operation of the new networkf
contributed to reducing the Radio division's current operating profit excluding
barters by EUR3.2 million. It reached EUR11.4 million in the first half of
2019, compared to EUR14.6 million in the first half of 2018, a decrease of
EUR3.2 million.

                              TELEVISION

Continuing on from the first quarter of 2019, the TV division's free-to-air
channels (NRJ 12 and Chérie 25) saw new audience share gains in the second
quarter of the 2019 financial year for the entire viewing public and for the
high commercial priority targets, including all-time highs in June.(7)

As such, in the first half of 2019, the combined audience share for the two
free-to-air channels totalled 2.8%(8) for the entire viewing public (+0.2
percentage points(9) compared to the first half of 2018), 3.4%(8) for the 25-49
age group target (+0.2 percentage points in 1 year(9)) and 4.0%(8) for the
Women Under 50 Responsible for Purchases target (up 0.4 percentage points(9)).
This increase in audience shares was seen for both NRJ 12 and Chérie 25.

According to the latest Médiamat'Thématik wave, NRJ Hits cemented its
undisputed position as the number 1 cable-satellite-ADSL music channel(10) with
a 104% lead on the number 2 channel.(11) The channel, which offers the greatest
hits every day, brings together almost 3.8 million viewers every month.(12)

In a highly competitive advertising market, the TV division's revenue(1)
nevertheless declined by 4.6% to EUR45.3 million in the first half of 2019.

By reducing expenses (mainly those for programming), which reached EUR3.0
million in the first half of 2019, the TV division was able to achieve a
current operating profit(1) of -EUR8.0 million, a EUR0.8 million improvement
compared to the first half of the 2018 financial year. The TV division is
continuing with an audience profitability strategy, enabling it to improve the
division's current operating profit.(1)

                          BROADCASTING

In the first half of 2019, the Broadcasting division recorded revenue(1) of
EUR34.8 million, an increase of 2.4% compared to the first half of 2018, driven
by growth of more than 4% in FM and DAB+ broadcasting activity and DTT
activity. The one-off DTT frequency reallocation services, down by 8%, ended in
the second quarter of 2019. Over the period, towerCast saw its DTT market share
increase (+1 percentage point) and now operates on 509 of its own broadcasting
sites, i.e. 12 more sites compared to the end of 2018, taken from third-party
hosting sites.

The division's current operating profit(1) was down by EUR2.7 million to EUR8.5
million given the increase in hosting expenses, in particular due to the
development of FM and DTT broadcasting activities, and staff expenses.

                             ****************

Next release: Third quarter 2019 financial information: November 6, 2019 (after
market close).

Additional information:

A limited review has been carried out on the condensed interim consolidated
financial statements. The Statutory Auditors' report will be issued with
unqualified opinion once all procedures required to file the half-year
financial report have been completed.

The French version of the 2019 half-year financial report will be available on
the Group's website www.nrjgroup.fr by July 26, 2019 at the latest.

APPENDICES

i Method for the first application of the IFRS 16 Leases standard

The Group has chosen to apply the simplified retrospective approach, without
reprocessing comparative periods of financial statements.

The current operating profit excluding barters saw a positive effect of EUR0.1
million, the financial result decreased by EUR0.2 million, and the net profit
Group share remained unchanged (see table below).

In millions of euros      H1 2019  Including IFRS 16      Including IFRS 16
                                  incidence of lease  incidence of amortisation
                                  expenses cancellation  of right-of-use assets
Current operating profit/
loss excluding barters     10.6             4.2                 (4.1)
Financial result           (0.8)
Net profit Group share      3.9

Including IFRS 16
incidence of interests
on lease liabilitiesTotal     IFRS 16 incidenceCurrent
                                         0.1
       (0.2)                            (0.2)
                                         0.0

ii EBITDA: Current Operating Profit excluding barters transactions before
amortisation and impairment of tangible and intangible assets and before net
change in provisions recorded in the Current Operating Profit but after current
depreciation on current assets.

In millions of euros           HY 2019     HY 2018
Current Operating Profit
excluding barters transactions     10.6          17.0
Amortisation and impairment of
tangible and intangible assets,
and net change in provisions       10.3           9.5 *
Amortisation of right-of-use
assets(1)                           4.1           0.0
Change in provision for post-
employment benefits recognised
in personnel expenses               0.6           0.6
EBITDA excluding barter
transactions                       25.6          27.1

(1) For the first time, the accounts for the first half of 2019 were drawn up
in accordance with the IFRS 16 standard (use of the simplified retrospective
approach, without reprocessing the previous financial year's figures).

* Until the end of the 2018 financial year, the change in provisions excluded
the reversals used (credited to the same line as that used for the expenditures
incurred). This ceased to be the case on 1 January 2019. In order to facilitate
the comparison of data, reclassifications were made; they helped reduce the
amount of net allocations to provisions to EUR0.5 million on 30 June 2018.

iii Net cash surplus:

In millions of euros     As at June 30,  As at Jan 01,  As at Dec
                           2019(i)            2019       31, 2018
Cash and cash equivalents   211.8             221.5         221.5
Group's outstanding bank
overdrafts and borrowings   (18.0)            (22.9)        (22.9)
Lease liabilities(1)        (33.1)            (31.5)
Net cash surplus            160.7             167.1         198.6

(1) For the first time, the accounts for the first half of 2019 were drawn up
in accordance with the IFRS 16 standard (use of the simplified retrospective
approach, without reprocessing the previous financial year's figures).

iv Excluding barters:

In millions of euros           HY 2019(i)  HY 2018 Change
Revenue excluding barters           192.6       193.2    -0.3%
Revenue on barters                    9.3         8.5    +9.4%
Revenue                             201.9       201.7    +0.1%
Current operating profit/loss
excluding barters                    10.6        17.0   -37.6%
Current operating profit/loss
on barters                           (1.5)        0.0     N.A.
Current operating profit/loss         9.1        17.0   -46.5%

(1) For the first time, the accounts for the first half of 2019 were drawn up
in accordance with the IFRS 16 standard (use of the simplified retrospective
approach, without reprocessing the previous financial year's figures).

v Free cash flow:

In millions of euros                      HY 2019     HY 2018

Cash generated from operations
before interest and taxes                    25.3       28.1
IFRS 16 incidence on Cash generated(1)        4.2
Changes in Working Capital                    1.9        1.3
IFRS 16 incidence on Changes in Working
Capital (1)                                   0.4
Income taxes paid / reimbursed               (5.2)       0.9
Net cash flows from operating activities (A) 22.0       30.3
Net cash flows from investing activities (B) (9.4)      (8.7)
Free cash flow (A)+(B)                       12.6       21.6

(1) For the first time, the accounts for the first half of 2019 were drawn up
in accordance with the IFRS 16 standard (use of the simplified retrospective
approach, without reprocessing the previous financial year's figures).

Sources:

(1) Excluding barters : consolidated revenue or current operating profit,
    according to IFRS standards. See appendice. iv
(2) Médiamétrie, 126,000 radio, NRJ Global, April-June 2019, Monday-Friday,
    5h-24h, targets specified, AC, QHM and Audience Share, Millennials =
    15-29 age group.
(3) Médiamétrie, 126,000 radio, NRJ, April-June 2019, Monday-Friday, 5h-24h,
    13-64 age group, AC.
(4) Médiamétrie, 126,000 radio, NRJ, April-June 2019, Monday-Friday,
    17h00-20h00, April-June 2019 vs April-June 2018. evolution of the Audience
    Share in percentage points.
(5) ACPM-OJD, global digital radio broadcasting, June 2019, active listening
    sessions +30 seconds, data for France, NRJ Group: 32,762,585 active
    listening sessions.
(6) Médiamétrie, Barometer of smart speakers, June 2019, among age group 15
    years &+, users of smart speakers and listening at least one radio station
    on a smart speaker, NRJ Group's listeners: 65.2%.
(7) Médiamétrie-Médiamat, Audience share, Day of viewing NRJ GROUP TV
    Division = aggregate NRJ 12 + Chérie 25, aged 4 years +, 25-49 age group,
    03h-27h, Monday to Sunday, January-March 2019 vs January-March 2018 and
    April-June 2019 vs April-June 2018, evolution of the Audience Share in
    points, all-time audience highs in June 2019.
(8) Médiamétrie-Médiamat, Audience share, Day of viewing NRJ GROUP TV
    Division = aggregate NRJ 12 + Chérie 25, aged 4 years + or targets
    specified, 03h-27h, Monday to Sunday, January-June 2019.
(9) Médiamétrie-Médiamat, Audience share, Day of viewing NRJ GROUP TV
    Division = aggregate NRJ 12 + Chérie 25, aged 4 years + or targets
    specified, 03h-27h, Monday to Sunday, January-June 2019 vs January-June
    2018. evolution of the Audience Share in points.
(10) Médiametrie, Médiamat'Thematik, consolidated audience, wave 37 (31 dec
     2018- 16 June 2019), 3h-27h, Mon-Sun, ranking musical channels TME, aged
     4 years +.
(11) Médiametrie, Médiamat'Thematik, consolidated audience, wave 37 (31 dec
     2018 16 June 2019), 3h-27h, Monday to Sunday, advance in % of TCE.
(12) Médiametrie, Médiamat'Thematik, consolidated audience, wave 37 (31 dec
     2018-16 June 2019), 3h-27h, Monday to Sunday, coverage 4 weeks viewing
     threshold 10 consecutive seconds.

Notice: Some of the information contained in this financial release may be
provisional. This information reflects either trends or objectives and cannot
be taken as a forecast of results or of any other performance indicator. By its
very nature, such information is subject to risks and uncertainties which may,
in certain cases, be beyond the Company's control. More details on these risks
and uncertainties can be found in the Company's Registration Document, which is
available on its website (www.nrjgroup.fr) in the "Finances/ Publications
financières/ Rapports financiers" section.

About NRJ GROUP

NRJ GROUP is one of France's leading private media groups in the publishing,
production and broadcasting sectors and also markets its own media spaces.

In France, the Group tops the private radio market with its four brands (NRJ,
CHERIE FM, NOSTALGIE and RIRE & CHANSONS), is a significant player on the
television market where it operates and develops two free national channels
(NRJ 12 and CHERIE 25) and a paid channel (NRJ HITS, the number 1
cable-satellite-ADSL music channel) and, through its subsidiary towerCast,
ranks number two on the French broadcasting market. Backed by its strong
brands, marketing expertise and commercial performance, in recent years the
Group has also developed a digital ecosystem enabling it to monitor and
anticipate changes in the consumption of media via new delivery mechanisms,
expanding its original brand portfolio through websites, mobile apps,
multi-channel networks and nearly 240 Internet radio stations. Today, NRJ Group
is the number 1 private Internet radio group in France. This digital presence
enables the Group's advertising business to provide its clients with a more
targeted offering thanks to the strategic data collected by the Group.

On the international market, the Group is present in 16 other countries, with
NRJ/ENERGY, the number one international radio brand, and/or
NOSTALGIE/NOSTALGIA, either directly or through partnerships or licensing
agreements.

NRJ GROUP shares are listed on the Euronext in Paris (compartment B). Codes -
ISIN: FR0000121691; Reuters: NRG-FR; Bloomberg: NRG FP.

                         Analyst and Investor Information
    NRJ GROUP - Investor Relations 46-50 avenue Théophile Gautier 75016 Paris -
                                 www.nrjgroup.fr
   FTI Consulting - Arnaud de Cheffontaines / Cosme Julien-Madoni / Tel: + 33 1
             47 03 68 19 / e-mail: nrjgroup@fticonsulting.com

    NRJ GROUP, a public limited company with capital of 781,076.21 euros Head
                  office: 22, rue Boileau 75016 Paris
                          332 036 128 RCS PARIS

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