TF1 (EPA:TFI) - FY 2020 Results – Press release
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11/02/2021 07:39
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[11.02.2021] PRESS RELEASE
TF1 GROUP 2020 FULL-YEAR RESULTS
Consolidated revenue of EUR2,082m (-11%)
Current operating profit margin of 9.1%, at EUR190m
Great agility in Broadcasting: savings of EUR152m in cost of programmes,
offsetting 100% of the decrease in the division's revenue
Dividend of EUR0.45 per share(1)
Boulogne, 14 February 2021
The TF1 Board of Directors, chaired by Gilles Pélisson, met on 10 February
2021 to close off the financial statements for the year ended 31 December 2020.
The results below are presented using the segmental reporting structure adopted
by the TF1 group and in accordance with IFRS 16 (applicable from 1 January
2019). Revenue and operating profit data (published and restated) are available
in our 2020 Financial Information Report and on the TF1 group corporate
website: www.groupe-tf1.fr/en.
(EURM) Q4 2020 Q4 2019 CHG. % FY 2020 FY 2019** CHG. ?M CHG. %
TF1 group advertising
revenue 520.4 497.8 4.5% 1,483.3 1,651.1 (167.8) -10.2%
Revenue from other
activities 199.9 224.9 -11.1% 598.4 686.2 (87.8) -12.8%
Broadcasting 556.7 528.6 5.3% 1,612.8 1,774.2 (161.4) -9.1%
o/w Advertising 500.4 472.6 5.9% 1,414.9 1,567.4 (152.5) -9.7%
Studios &
Entertainment 109.6 144.7 -24.3% 309.2 390.0 (80.8) -20.7%
Unify 54.0 49.4 9.3% 159.7 173.1 (13.4) -7.7%
Consolidated
revenue 720.3 722.7 -0.3% 2,081.7 2,337.3 (255.6) -10.9%
Broadcasting 35.4 28.9 22.5% 163.0 185.5 (22.5) -12.1%
Studios &
Entertainment 23.9 32.9 -27.4% 31.1 57.9 (26.8) -46.3%
Unify 5.2 8.9 -41.6% (4.0) 11.7 (15.7) -134.2%
Current operating
profit 64.5 70.7 -8.8% 190.1 255.1 (65.0) -25.5%
Current operating
margin 9.0% 9.8% -0.8pt 9.1% 10.9% - -1.8pt
Operating profit (10.5) 70.7 - 115.1* 255.1 (140.0) -54.9%
Net profit attributable
to the Group (21.8) 37.0 -1.5x 55.3 154.8 (99.5) -64.3%
Broadcasting advertising
revenue 500.4 472.6 5.9% 1,414.9 1,567.4 (152.5) -9.7%
Cost of programmes (311.4) (325.8) -4.4% (833.2) (985.5) 152.3 -15.5%
* Operating profit for FY 2020 includes the impact of the EUR75 million
write-down of Unify assets. See our press release of 23 December 2020:
https://groupe-tf1.fr/en/press-release/unify-goodwill-write-down-no-impact-
group-s-cash-position
** 2019 figures were adjusted. See note 4.1 of the appendix of the TF1 Group
accounts
Consolidated revenue of the TF1 group for 2020 was EUR2,081.7 million, a
decrease of EUR255.6 million, in a year when all of the Group's operations were
impacted by the Covid-19 crisis.
Group advertising revenue was EUR1,483.3 million, down 10.2% year-on-year.
After a first half that was hit by the effects of the crisis, the fourth
quarter saw advertising revenue rise by EUR22.6 million (+4.5%) versus the
comparable period of 2019.
(1) Subject to approval by the Annual General Meeting of 15 April 2021.
Revenue from the Group's other activities amounted to EUR598.4 million, down
EUR87.8 million, due mainly to the suspension of shooting in April and May and
to the cancellation or postponement of live shows, concert tours and cinema
releases.
The Group posted a current operating profit(2) of EUR190.1 million(3), down
EUR65.0 million.
Current operating margin was 9.1%, compared with 10.9% in 2019.
Net profit attributable to the Group amounted to EUR55.3 million, a decrease of
EUR99.5 million. This reflects (i) a lower level of income tax expense and (ii)
the recognition of the EUR75 million write-down taken against the assets of
Unify.
Analysis by segment
Throughout the public health crisis that dominated 2020, the TF1 group remained
focused on its priorities. Measures were introduced to protect our employees,
and remote working practices were deployed, while at the same time ensuring
business continuity.
Broadcasting(4)
The French public showed an increased appetite for television in 2020, not only
during lockdown periods but also when the government eased restrictions, for
example in the summer of 2020. The average daily TV viewing time among the
French population was 3 hours 54 minutes, 24 minutes more than in 2019. In this
favourable environment, the TF1 group maintained its market leadership among
target audience groups, attracting a daily average share of 32.4% of "women
aged under 50 purchasing decision makers" (W<50PDM) and 29.9% of 25-49
year-olds. For this particular target group, the Group's audience share has
been on a constant uptrend since 2017 (+0.7 of a point).
During 2020, TF1 confirmed its ability to bring people together across all
programme genres and audiences. The Group's channels delivered high-quality
content, to meet viewers' increased needs for both news and entertainment:
- Gold standard news programming, with high viewing figures throughout the
year, and an average increase of 21% in audience share for regular daily
bulletins in 2020. Average daily audiences reached 6.5 million viewers for
the evening bulletin (up 1.2 million vs. 2019) and 6.0 million for the
lunchtime bulletin (up 1 million vs. 2019, and a 42% share of individuals
aged 4+).
- Strong French drama offer, with ratings hits like Pourquoi je vis ? (8.3
million viewers) and the new daily soap Ici tout commence (average 4.2
million viewers in access prime time).
- Iconic entertainment shows that remain as successful as ever, such as the new
show District Z (peak of 5.7 million viewers) and Koh Lanta on TF1 (average
of 6.4 million viewers) and Quotidien on TMC (average of 1.8 million
viewers).
(2) Current operating profit after leases (i.e. excluding the impact of IFRS
16) for 2020 was EUR186.7 million, down EUR64.7 million year-on-year..
(3) Current operating profit includes a negative impact of EUR14 million due to
a change in the amortisation rules applied to American series on first and
second transmission, from 50/50 to 67/33.
(4) TV consumption and audience share figures are sourced from Médiamétrie.
- Leverage effect of non-linear audiences on the MYTF1 catch-up platform. For
some programmes, non-linear consumption added an average of over 20% to
viewing figures, as in the case of the foreign series New Amsterdam (+29%)
and the French series Les bracelets rouges (+23%).
- Broadcasting segment revenue amounted to EUR1,612.8 million, a decrease of
EUR161.4 million or 9.1%.
- Advertising revenue for the Broadcasting segment in 2020 was EUR1,414.9
million, down by EUR152.5 million. After a first half hit hard by cuts to
advertising spend due to the Covid-19 crisis, the second half saw revenue
rise by EUR52.8 million (6.8%) year-on-year, despite a tough comparative
caused by the screening of the Rugby World Cup in September and October
2019.
This reflects a resumption in advertising spend in several sectors,
especially in food, retail, personal care, e- commerce and telecoms.
In the fourth quarter, advertisers benefited from the high viewing figures
posted through to December, such as for appointment TV shows like Miss France
2021 and the NRJ Music Awards and the successful launch of the new daily soap
Ici tout commence. Only a few sectors - such as travel, tourism and cosmetics -
remain in decline.
- Revenue from other Broadcasting segment activities was slightly down year-on-
year, by EUR8.9 million, mainly on lower advertising spend on MYTF1 in the
first half, though the effect was partly offset by higher interactivity
revenues.
- The cost of programmes on the Group's five free-to-air channels was EUR833.2
million, a saving of EUR152.3 million. This remarkable performance
demonstrated the Group's adaptability, and reflects a reduction in the unit
price of programmes broadcast, optimisation of the running time of
entertainment shows, and better recycling of rights between the Group's
channels. Those savings were implemented without impairing the quality of
programming schedules, resulting in high audience ratings. They absorbed
100% of the erosion in advertising revenue from broadcasting.
- The Broadcasting segment reported a current operating profit of EUR163.0
million, down EUR22.5 million year-on-year. Current operating margin was
10.1%, versus 10.5% in 2019.
Studios & Entertainment
- Studios & Entertainment segment revenue for 2020 was EUR309.2 million, down
EUR80.8 million year-on-year.(5) The segment was hit particularly hard in
2020 by the suspension of shooting in April and early May, and by the
cancellation or postponement of live shows, concert tours and cinema
releases.
After a first half badly affected by the suspension of shooting, Newen was one
of the first producers to restart operations, from mid-May onwards. The Group's
studios outside France - such as Reel One (Canada), Tuvalu (Netherlands) and De
Mensen (Belgium) - also returned to normal activity levels.
The successful launch of the new soap Ici tout commence confirmed Newen's
expertise in the production of daily soaps. International operations have
expanded further, with the creation of Ringside Studios in the United Kingdom.
Newen has also been developing partnerships with SVoD platforms, which are
exporting into a number of countries. Newen enjoys good visibility, with a book
of orders at more than 1,600 hours(6).
Finally, TF1?Entertainment saw a sharp fall in revenue due to the
postponement or cancellation of projects at music label Play Two and the
partial shutdown of scheduled live performances at the La Seine Musicale
venue.
- The segment posted a current operating profit of EUR31.1 million in 2020,
down EUR26.8 million. Most of that came in the second half of the year, with
the fourth quarter alone contributing EUR23.9 million. Current operating
margin for 2020 was 10.0%.
Unify
- The Digital segment (Unify) posted revenue of EUR159.7 million, down EUR13.4
million year-on-year.
After a first half that was hit hard by the Covid-19 crisis, advertising spend
(direct media and programmatic) recovered gradually from the third quarter.
Traffic on Unify websites surged during 2020, trebling at Marmiton and doubling
at aufeminin. Advertiser services picked up in the fourth quarter, taking that
business back into growth compared with the fourth quarter of 2019.
Social e-commerce proved resilient to the crisis, with revenue stable
year-on-year, helped by increased shipments for My Little Box and Gambettes
Box.
This end-of-year uptick enabled Unify to post fourth-quarter revenue up 9%.
(5) The deconsolidation of Téléshopping in the second quarter of 2019 had a
negative impact of EUR20.2 million in 2020.
(6) Number of hours ordered net of hours delivered as of 31 December 2020
(projects worth over EUR1 million).
The reorganisation of Unify continued during 2020: a new governance structure,
the rollout of new IT tools and an asset review will all help Unify to grow,
and ultimately return to better performance levels.
- Unify posted a current operating loss of EUR4.0 million, a net year-on-year
downswing of EUR15.7 million, in line with the drop in revenue (mainly in the
first half).
Financial position
Shareholders' equity attributable to the Group was EUR1,596.6 million at 31
December 2020 out of a balance sheet total of EUR3,363.1 million.
The lack of a dividend payout in 2020 (in response to the health and economic
crises caused by Covid-19) and an improvement in operating working capital
needs helped the TF1 group reduce net debt to EUR0.7 million as of 31 December
2020 (net debt of EUR93.1 million including lease obligations). That compares
with net debt of EUR126.3 million as of 31 December 2019 (net debt of EUR225.8
million including lease obligations).
To give a return on capital invested and in line with our policy of returning
value to our shareholders, the Board of Directors will ask the Annual General
Meeting of 15 April 2021 to approve the payment of a dividend of EUR0.45 per
share, representing 73% of net profit after stripping out the non-current
accounting impact of the EUR75 million write-down of Unify assets.
The ex-date will be 3 May, the date of record will be 4 May, and the payment
date will be 5 May 2021.
Movements in share capital
Between 1 January and 31 December 2020, 4,583 treasury shares were cancelled.
As of 31 December 2020, both the number of shares and the number of voting
rights stood at 210,392,991, given that TF1 did not hold any of its own shares
at that date. The share capital stood at EUR42,078,598.20.
Governance
Acting on the advice of the Selection and Remuneration Committee, the Board of
Directors will ask the Annual General Meeting of 15 April 2021 to reappoint the
following to serve as directors for a three-year term of office: Laurence Danon
Arnaud; Bouygues SA (permanent representative: Pascal Grangé); and SCDM
(permanent representative: Charlotte Bouygues).
The Board has assessed the independence of Laurence Danon Arnaud and concluded
that she would continue to have no business relationship with the TF1 group in
2021, and would retain her status as an independent director by reference to
all the AFEP-MEDEF Code criteria.
The Board of Directors will also submit to the Annual General Meeting the
appointment as employee shareholder representative director of Marie Aude
Morel, who has been proposed as a candidate by the Supervisory Board of the
employee share ownership fund (equity interest held by TF1 group employees as
of 31 December 2020: 8.4%).
Subject to shareholder approval of those appointments, the TF1 Board of
Directors would continue to have four female independent directors, which means
that 44% of the directors would be independent and 56% would be women (without
taking account of (i) the two employee representative directors and (ii) the
employee shareholder representative director to be appointed, all of whom are
women).
Extra-financial performance
At the end of 2020, we unveiled our 2030 climate strategy, targeting a 30% cut
in our scope 1 & 2 and 3a emissions by 2030. We also reiterated our commitment
to the low-carbon transition, both through our content and by supporting our
customers (advertisers and media agencies)(7).
Finally, it was confirmed in the fourth quarter of 2020 that the TF1 group had
retained its place in the Gaïa extra-financial index. This means that the TF1
group was included in the following extra-financial indices in 2020: DJSI
(Europe & World), MSCI, and Gaïa - official recognition of the Group's
commitment to corporate social responsibility.
Outlook
Our 2020 full-year results illustrate the adaptability of our Broadcasting
operations. In 2021, the Group will reap the rewards of a strong and
diversified line-up including Je te promets, the Euro 2021 football tournament
and La Promesse. Amidst persistent uncertainties about public health and the
economy, we will confirm our flexibility in managing the potential impacts of
the changing situation.
For Studios & Entertainment, the expansion of international production
activities means that in 2021 a substantial portion of the segment's revenue
will be generated outside France, as well as increasing its order backlog with
pure player platforms. 2021 should also see a gradual resumption of activity in
live shows and music.
For Unify, our objectives of refocusing, brand enhancement and developing
synergies will enable the division to increase revenue and return to a positive
current operating profit margin in 2021.
The TF1 group has sustainable growth momentum, with opportunities in both
content and digital, that will make it a force to be reckoned with in the Total
Video sphere.
(7) For more information, see our climate strategy press release:
https://groupe-tf1.fr/en/press-release/tf1-group-climate-strategy.
Gilles Pélisson, TF1 group Chairman & CEO, said:
"In 2020, the TF1 Group confirmed its position as an essential and responsible
player in content. In a year marked by a health crisis that strongly affected
us, our results demonstrate the commitment of our employees, the agility of the
Broadcasting division and the solidity of our model. Strengthened by the
lessons of 2020, we are pursuing our dynamic of development and innovation in
content, production and digital, to occupy a leading position in the world of
Total Video."
Executive remuneration
In accordance with the AFEP-MEDEF recommendations, disclosures about executive
remuneration are being published today on our corporate website at
www.groupe-tf1.fr/en: go to Investors / Governance / Report on Remuneration.
The financial statements have been audited, and an unqualified opinion has been
issued by the auditors.
Find the full financial statements and notes at http://www.groupe-tf1.fr/en.
The analyst meeting presenting the TF1 group's results will be streamed live on
http://www.groupe-tf1.fr/en starting 09.30 hours Paris time on 11 February
2021.
The presentation is available on http://www.groupe-tf1.fr/en.
For details of how to connect go to
https://www.groupe-tf1.fr/en/investors/results-and-publications.
TF1 GROUP
CORPORATE COMMUNICATIONS - mcarcabal@tf1.fr
INVESTOR RELATIONS - comfi@tf1.fr