Prosieben Sat 1 Media

Good morning, ladies and gentlemen, and welcome to the full year 2020 results call of ProSieben Sat.1 Media SE. This conference is being recorded. Today's call is hosted by Mr. Dirk Voigtländer. Please go ahead, sir.

Good morning, ladies and gentlemen, and welcome to our full year 2020 results conference call. As always, today's call will be hosted by Rainer Boujean, Chairman of the Executive Board in Group CFO, as well as Ralf Gehrig, Deputy CFO of the Group. Rainer and Ralf will first walk you through the operational performance and the Group's financial results for the fourth quarter, as well as the full year 2020, respectively. In addition to that, Rainer will provide an update regarding the Group's strategy, as well as the resegmentation, which has been announced today. The presentation will be followed by a Q&A session. Besides the financial documents regarding full year 2020, we have also made backups for the new segment structure available on our website under the section investor relations and results. We would therefore kindly ask you to primarily focus on questions regarding the performance and outlook of the group in today's Q&A session. The IR team will of course be available to answer any other questions regarding the resegmentation post this call. With these opening remarks, I now hand over to Rainer.

Good morning also from my side and welcome to our analyst and investor call on the occasion of our 2020 full year results. ProSiebenSat1 is a strongly diversified media company. As such, we got through this pandemic year better than many of our competitors. Despite the challenging macroeconomic situation throughout the year, we were able to end 2020 on a positive note. Our market capitalization and share price were developing positively, and we have laid important strategic foundations that will help us to leverage more synergies to grow sustainably in all segments and thus to create value now and in the future. Let's have a look at today's agenda. We will start with an operational review of the year 2020 before we cover our group financials. We will also give you a strategy update and finish the presentation with our 2021 outlook and the dividend proposal. Let's jump right into it on slide number three. First, 2020 was a year to remember for ProSiebenSat.1. We had started the year well. Then in March, like everyone else, we were hit by the COVID-19 pandemic, which turned out to become the worst economic crisis since the post-war period. Second, on March 26, the supervisory board decided to realign our company both in terms of personal and strategy. Together with my executive board colleagues, Christine Schaeffler and Wolfgang Link, we took over the management of the group. Since then, We have been guiding ProSiebenSat.1 safely through this crisis and setting up a clear roadmap for our company. Third, the COVID-19 effects impacted our business, especially in the second quarter. As an early cycle company, we however profited from the economic recovery as of the third quarter and were able to record a very strong fourth quarter. This is why we exceeded our full-year guidance that we had published in the course of our Q3 reporting. We achieved almost stable full-year group revenues of 4 billion 47 million euros and an adjusted EBITDA of 706 million euros. At the same time, we reduced our net debt by 277 million euros. Fourth, On the operational side, we proved our entertainment strength. With our focus on relevant local and live programs, our newly set up 7.1 Entertainment Group convinced amongst the competition and catered people's need for distraction and information at its best in times of social distancing. Fifth, we are concentrating on driving our diversification and leveraging our synergies. This is also the reason Why we set up ProSiebenSat1 as of January 1st, 2021 around three strong pillars. Entertainment, dating and commerce and ventures are our foundation for future value creation. We will cover this later in detail. Sixth, at the same time, we made good progress in our active portfolio management. This includes value creating acquisitions such as the acquisition of the meat group. The newly formed Parship Meet Group is now core of our strategy as a leading global player in the dating business. Next to acquisitions, our portfolio strategy also includes disposals if we are able to generate significant value for the group and if we are no longer the best owner. This was the case in 2020 with the hosting solution provider Mylock and the OTC company Winster Medical. Let's dive a bit deeper into our operational highlights. On slide number four, you can see that our entertainment focus on relevant local and live content clearly paid off in 2020. In total, our content reached 2% more daily net viewers on average. On Linear TV, our channels ProSieben and Sat1 were the only two major private stations to increase their market shares in prime time. the most relevant slot for advertisers. We saw outstanding entertainment such as The Masked Singer, public value highlights like Thilo Mischke's political reports, or just recently our NFL Super Bowl coverage. The latter achieved a record-breaking average market share of almost 58% within our main target group. In the digital space, our streaming platform JOIN recorded an increase of almost 30% in unique users in the fourth quarter compared to the previous year. You will see on the next slide how we were able to monetize this development. With iSET on the future, we also took advantage of the high media usage during lockdown in order to grow our database. Since April, Our content offerings on our TV channel websites as well as platforms such as Join have only been accessible after a one-time registration. In a mid-term perspective, this will improve our targeted advertising offerings and thus turn data into earnings. Next to advertising as our major revenue stream, the distribution business is another important and highly profitable backbone for our business. Fueled By 6% HD subscriber growth, distribution revenues grew by 9% in the full year 2020. Our strong positioning in the market is a very good basis for negotiations with third-party platforms and led to new deals. Moving on to slide number five. As already highlighted at the beginning, our business recovered gradually after a strong hit in Q2. especially influenced by the development of our advertising revenues. Advertisers had cut their budgets due to the COVID-19 restrictions, but with the economy brightening as of summer, our advertising revenues recovered as well as even increased on the fourth quarter, traditionally our most important quarter by 3% compared to the previous year. In other words, we experienced a classic V-shape recovery. This development was supported by our strong content offering. Even with strict cost measures in place as of spring, we continue to invest in our program unlike many competitors. Together with our viewers increased demand for entertainment and information. This led to a rise of our total video view time, thus the minutes watched at all of our platforms by 0.8%. Let's turn to slide number six. The formation of Parship Meat Group was a milestone in our strategic journey. By combining our Parship Group with the US-based The Meat Group, we have created a leading global player in the dating market. Overall, we expect Parship Meat Group to significantly support the diversification of our revenues and earnings. Looking at the performer figures, 522 million euros pro forma revenues and 160 million euros pro forma adjusted EBTR already gives a good impression of what to expect from this company in the future. The new group covers the entire spectrum of the dating market. Meet, date, love to services from casual dating and social entertainment to serious online matchmaking. These markets are fast-growing and very profitable, and not just because of the COVID-19 pandemic. Plus, the group has a highly diversified revenue model comprising long-term and short-term subscriptions, platform services, as well as revenues from advertising and in-app purchases. And with the Meet Group's video streaming expertise, our dating business now also taps into the highly growing live video market. To sum it up, this is a classic platform business, very scalable and with a strong entertainment aspect that opens great cooperation opportunities with the entertainment segment of ProSiebenSat.Eins. On the next slide, you see a quick recap of our most important portfolio effort of last year. As we consistently analyze our portfolio to see if all companies still contribute to our group strategy and if we are still the best respective owner, we also have the option to divest the company. This was the case with Winstar Medical. In December, we sold Newcom Group's entire 92% stake in this leading provider of healthcare products to the financial investor Oakley Capital. Within four years, we significantly grew its brand's awareness through advertising on our platforms and expanded its market position considerably. Fueled with our media power, WinStar's enterprise value increased by 2.4 times in this time. This is an impressive development and underlines the added value that we can generate through synergies with our entertainment business. On slide number eight, you can see another example of our value creation. In 2012, our investment unit Seven Ventures secured a minority share in Flaconi through a media for equity deal. Since then, we subsequently expanded our stake and transformed the brand into the leading online shop for beauty products in Germany. Since ProSiebenSat.1 has been the majority owner of Flaconi, the company has increased its revenues by more than eight times. In 2020 alone, we grew revenues by an outstanding plus of 48%. Another strong proof of the brand building and value-creating power of TV. The shift in shopping habits from offline to online is additionally driving Flaconix's success. The company attracted more than 1.4 million new customers in the past year. and the future potential is high. The online share of the beauty market in Germany is only at around 10%, and Flaconi has proven its ability to internationalize by entering Austria and also markets outside the German-speaking region, such as Poland, both leaving plenty of room for growth. With this, Let me now hand over to our deputy CFO, Ralf Gierig, who will guide you through our group financials for the full year of 2020 and the very successful fourth quote.