Vivendi Se Unsp/Adr

Good evening, everyone, and welcome to the Vivendi Full Year 2022 Earnings Presentation. This conference call will be hosted by Mr. Arnaud Dupuy-Fontaine, Chairman of the Management Board and CEO, and Mr. François Larose, Member of the Management Board and CFO. As a reminder, this call is being recorded. During the call, you'll be in listen-only mode. However, later on in the call during the Q&A session, Analyst will have the opportunity to ask three questions without any follow-up questions. This can be done by pressing star 1 on your telephone keypad to register your question at any time. If at any point you require assistance, please press star 0 and you will be connected to an operator. I'd like to turn the call over to Mr. Arnaud, the P410. Please wait, sir. Your line is open.

Thank you. Hello, everyone, and welcome, and thank you for joining us today. In a few minutes, I will hand things over to Francois Larose for a detailed review of our annual results. Before that, I would like to highlight the solidity of our group with another year of double-digit growth. Revenues increased by 10.1% compared to 2021, driven by our two main businesses, Avas and Canal+. And Group EBITDA increased by 35.6% or 10% for our controlled businesses, proving their resilience. Adjusted net income, excluding Telecom Italia, increased by 19.4%. Net earnings amounted to a loss of 1 billion, which is the result of Telecom Italia's deconsolidation, François will come back to this. I want to warmly thank all our colleagues around the globe for this very solid performance. The new chapter we wanted to open following the distribution of UMG Group's share capital is off to a great start. 2022 was a turning point for Vivendi, not only because, as I just mentioned, it was the first full year without Universal Music Group. But, more importantly, we took a major step forward in our strategic project, building on the three main pillars you are familiar with by now. First, transformation. All our entities have continued their transformation. Let me give you just three examples. Gameloft made an important strategic shift by launching its very first multiplatform game, Dreamlight Valley, which is a phenomenal success. Gameloft revenues reached their highest level ever. Moreover, embracing console should make it possible to double our target market. Prisma Media is my second example. Digital now represents 35% of its revenues compared to 31 in 2021. The group is the leader in digital and video audiences. Every month, it reaches 8 out of 10 French people thanks to digital. Third example, Editis. The leader in education in France, the group accelerated its transformation thanks to the acquisition and integration of EduClever, the leader in e-learning with 5 million learners. We also moved forward on our second pillar, internationalization. The Canal Plus group continued its dynamic development and, in particular, increased its stake in Multiture's Group, now owning 30% of its capital. 63% of Canal Plus subscribers are outside France. As for AVAS, a record of eight new agencies came on board last year to strengthen our range of expertise in the UK, Spain, Australia, and China. At group level, 43% of Vivendi's employees are based outside Europe. Our ambition remains global. Third and last pillar, integration. As I talked about during our half-year results conference call, in 2022 we put in place a new management board and a newly created executive committee. All our businesses are now represented. This will facilitate more and more joint projects for more value creation. We created a winning positioning by being at the crossroads of media, communications, and entertainment. For example, it allowed AVAS to win a project with EDF in cooperation with other group entities, including Canal, Gameloft, and Prisma to support the efforts of French people in their approach to energy sobriety. Across all pillars, 2022 was full of achievements. These successes position our group as one of the world leaders in media, entertainment, culture and communication. In parallel, we continue to shift towards a more sustainable business model. With a burning planet and a fragmented world, there is no need to remind you of the urgency for companies to have a positive impact. As a content group, We are particularly focused on delivering meaningful, inclusive content and content that contributes to raising awareness on climate change, such as the Studio Canal production, Goliath. As I did last year, I would like to point out some of our main ESG developments. You will find more details on the slides and on the appendices. On the environment, our CO2 emissions, scopes one and two, have been reduced by 10% compared to 2021. On social, We increased the percentage of women within our management bodies. They now represent 38%. As you know, we also welcome two women to Vivendi Management Board, Claire Leost and Céline Mert-Béral, out of six members. Looking ahead, we are extremely confident and ambitious for the future for five main reasons. The first is the unstoppable worldwide consumer appetite for culture, media, and entertainment. According to a report from PWC, the global entertainment and media industry is expected to grow at a CAGR of 4.6% through 2026. And in this dynamic industry, we strongly believe in our ability to make the difference. Because, and this is the second reason for our confidence, we are investing in quality content and building IPs. Having the most extensive and appealing offer possible is key to attracting consumers. Canal Plus has, for example, the largest film library in Europe. Across all forms of content, the brand has devoted €3.5 billion to financing programs in 2022. Third reason, strong and appealing brands that have stood the test of time. Havas is nearing its two-century anniversary. Canal Plus has been around for almost 40 years. Prisma Media, 45 years. They have proven that their capacity to adapt and transform to stay the course. With this, we come to the fourth and fifth reasons, agility and time. In increasingly uncertain environments, agility has become as important as scale. Each of our businesses is agile enough to seize opportunities, innovate, and yes, even surprise. look at the exciting and expected launch by Prisma of Harper Bazaar in France. And time, thanks to our principal shareholder, the Poloré Group. We provide a long-term vision and give the necessary resources to our business to succeed, as we did for Gameloft, enabling it to transform itself from solely mobile to cross-platform. This long-term vision is what allows us to create value for all stakeholders, As you can see on the chart, if you held one Vivendi share in June 2014, the value in December 2022 was multiplied by 2.3 with dividends reinvested. Over the same period, the CAC 40 with dividends reinvested posted a performance of 1.8. These coming months will enable us to reach new steps. We are working on finding a solution regarding Telecom Italia. As you know, in January, Vivendi representatives resigned from their role as members of its board of directors. This is why we stopped the consolidation of Telecom Italia share. This will give Vivendi greater freedom to defend its position outside governance bodies as a shareholder over the long term. We remain determined to ensure that this company's real value and unique network are properly recognized The words of appreciation extended by the Italian government towards Vivendi last week are an important signal and give us hope in the possibility of opening a new chapter. We are also fully mobilized on the Editis-Lagardère matter. We are engaged into a constructive dialogue with the European Commission with a view to obtaining approval for our proposed transaction with Lagardère. We are also pursuing discussion with buyers who have expressed interest in acquiring a controlling interest in Editis, we received three solid offers and have conducted confirmatory due diligence. The combination of our two groups, when approved by the European Commission, will offer exciting perspectives. I will now hand things off to Francois. Thank you for your attention.

Thank you, Arnaud. Good evening, everyone. So I will walk you through the result of the group, starting by the nutshell, reminding that for year 2022, we have achieved a revenue of $9.6 billion. It's an increase by 10%. EBITDA of control business of $646 million increased by 10%. If we add to this control business, the EBITDA coming from the equity affiliates, it goes up to $860 million. It's an increase by 36%. Let's remind that in its revenues and EBITDA are excluding EDTs, which is now considered as business for sale. The adjusted net income, excluding the Telecom Italia impact on which we'll come back, is $677 million. It's an increase by 19%. Let's remind that we have almost 36,000 employees increased by 7% compared with our increased by 10% of revenue confirming the productivity of our main businesses. The financial situation of the group Vivendi is very solid. The net debt is 860 million compared with our shareholders' equity of 17 billion. The cash flow generated by our businesses is 594 million and we still have available credit facilities for 2.8 billion. Let's move to the bridge from our adjusted net income to the net result group share. As we said, we have an adjusted net income of 677 million, but as Arnaud mentioned, we have been in a position to take the impact of the deconsolidation of Telecom Italia, taking the stock price at the end of the year 2022, with an impact of 1.3 billion euro, from 0.6 roughly to 0.21 euro per share. To this impact, we had the income from equity affiliate for Telecom Italia, which was a loss of 393. Then we have the contribution of Banijay to FLE, which was during the first half, 515. And another discontinued operation impact which is this year a negative impact, taking into consideration that we have taken a provision of 300 million for ADTs in our account.

We'll come back on it.

Therefore, our net result group share is a loss of 1 billion or 10 million euro, compared with this 677 adjusted net income. If we move to the net debt evolution, The group went from 0.3 net cash positive at the end of the previous year to 0.9 net debt. It's an evolution of minus 1.2. Important to remind that this evolution of the cash mainly comes from the investment we have achieved during the year 2022. More than 500 million invested in Lagardère shares, 400 million in multi-choice, and 200 million in various acquisitions made by Canal Plus and Avas, on which we'll come back. Therefore, we have invested more than 1.1 billion in this acquisition, preparing the result of the future. In the same time, the existing business has delivered more than 600 million of cash flow, which enables us to pay the shareholder return through dividends and buybacks. Let's remind that average maturity is 4.1 year and the fixed rate is 99% fixed rate. Let's move to the operational performances of the businesses. If we take the revenue, we have an increase of our revenue by 10%. All the businesses contributed to the extremely good performance, including Canal+, 1.7%, and Avas, 18%, but also Prisma and Gameloft. This 10% is a growth evolution, taking into consideration that we have 5.1% of organic growth, to which we had 3.1 points of consolidation scope impact and 1.9 points of FX impact. which lead to this 10.1% growth. If we move to the EBITDA, we have the same trend with an increase by 10% for the control business, again coming from all our businesses. Canal+, delivering an increase by 7.3% from 480 to 515 million. Avas, with 19.7% of increase from 239 to 286, the other businesses contributing as well as Prisma and Gameloft to this strong increase. If we add the income from the equity affiliates, it's an increase by 36%. If we come back to the 10% increase of the EBITDA for the control business, this comes from 4.5% of organic growth, 2.4 from consolidation scope impact, and 3.1 from FX Impact, mainly Euro-Dollar conversion rate in Avaas. Let's enter into details for our main businesses. Canal+. The number of subscribers at the end of the year is 25.5. It's an increase by 1.1 million compared with last year, where we were at 23.7 million subscribers. 15.8 million are in Europe, among which 9.5 in France, 7.6 in Africa, 1.2 in APAC, and 0.8 in overseas. In terms of results, both international and mainland TV France have contributed to this increase of the revenue. International TV by 6.4%, TV mainland France by 1.6%. The decrease of Studio Canal is not a decrease which leads deterioration of the results. But in 2021, there were some business with very low margin, which has been canceled this year. And therefore, even with a 19.2% decrease of the revenue, the EBITDA of Studio Canal is growing fast this year. If we move to Avas now. Avast has a very strong performance in terms of organic growth with 6.8%, and this growth comes from all the geographies. The first of it, Europe, with 7.6%, but also North America, 5.2%, Latin America, 13.6%, and Asia, 5.8%. So the growth has been equally shared between the different geographies. In terms of results, as we saw, It's an increase by 15.8% of the net revenue with 6.8% of organic growth. The EBITDA is increasing by 19.7% and the CFFO by 28%. The increase of the organic growth is 6.8 to which you add the consolidation impact for 2.7 and strong FX impact, very positive, again, US dollar to Euro conversion rate of 6.3. That's the reason why we post this 15.8% growth for Avas. As Arnaud mentioned already, we have achieved a record year with eight acquisitions of controlling stake during the year 2022. Four of them in the UK, two in Australia, one in Spain, and one also in China, and we have been very proud to achieve this major acquisition of the Front Networks company with more than 200 people that will contribute to the growth of the group in Asia in the coming months and years. Prisma Media. Prisma Media has had a stable revenue at 320 million, and the EBITDA is coming from 30 to 31 million, which is positive increase and negative by 5.18 in organic. Let's remind that today 35% of the revenue of Prisma is coming from digital. It's a growing number year after year. Gameloft. A few words on Gameloft again. If you see the trend here, after very tough years in 19 and 20 with huge losses, Gameloft went back in black figures in 2021, 8 million and 2022, 12 million. It's an increase by 21% of the revenue, 46% of the EBITDA. It's due to the success of the different games, as Arnaud mentioned, Dreamlight Valley, but not only, also Asphalt for the mobile and Oregon Trail for the cross-platform. Ticketing and life of Vivendi Village. It's a very strong increase of the revenue from 102 to 238 million. This increase is mainly due to the come back to normality in our ticketing business with the end of the COVID impact. The EBITDA is moving from 8 million loss to 6 million, but with different performance of the business units. The ticketing is doing very well in 2022. with strong recovery of the revenue and high profits. The venues, like L'Olympia, Théâtre de l'Oeuvre, are delivering sound results as well. This year, nevertheless, we are accounting some losses in our touring business, losses and some restructuring costs as well, which can be considered as one-off costs, which prevent us from having new losses the coming year. Looking at portfolio of financial assets, the total value is around $9 billion and we have received $196 million of dividend during the year 2022. Let's remind you the main stakes in Universal for 10%, Lagardère 58%, Thiem 17%, MultiChoice 21% for the first bigger. In terms of shareholder return, We will propose to the shareholder meeting a dividend of 0.25 dividend per share. If we look at the history, we see that the cumulative shareholder return since 2014 amounts to 18 billion. For the year 2022, it's more than 600 million, of which 325 million of share buyback and 261 million of dividends. As of March 8, 2023, the VVND holds 78.2 million of treasury share, which is a stake of 7% of the share capital. We have an agreement for going up to 10% of the share and still have this agreement of an OPRA of 50%, and the renewal of this agreement will be proposed to the shareholder meeting. As a conclusion, before giving you the floor for questions and answers, we can remind the very strong growth of the business, and I would like to stress the fact, as Arnaud mentioned, that we are very satisfied by the performance of our business themselves, but also by the ability of our different business to work even more together. We have many examples of this cross-fertilization of the different business. Our financial situation is extremely robust. We remind you that we will release the Q1 2023 revenues on April the 24th. As I said, we propose a 0.25 euro per share dividend that should be paid on April 27th. Thank you for your attention and ready to answer your question with Arnaud.

Ladies and gentlemen, as a reminder, if you'd like to ask a question, please press star 1 on your telephone keypad. Once again, please limit yourselves to a maximum of three questions and no follow-up questions. First question this evening is coming from Mr. Omar Shaikh calling from Morgan Stanley. Please go ahead, sir. Your line is open.

Good evening everyone, and thank you for taking the questions. My three then, maybe if I start with Lagardère. Could you, I noticed in the press release you highlighted that you're expecting an EU decision by June. Could you just say about whether or not you're still confident that you'll get a successful outcome from the conclusion of the process? That's the first question. Secondly, you mentioned the 78 million shares that you hold in Treasury. Could you just clarify exactly how many of the 78 million shares have to be cancelled during 2023 as part of the obligation under the legal framework that you mentioned? And then finally, just on Habas, I noticed that there was quite a big gap between the net and gross revenue growth in Q4, presumably that's because there was a step up in pass-through costs. Can you just maybe talk about what happened in the fourth quarter and then maybe more broadly what your expectations are for organic growth at the net revenue level in 2023. Thank you very much.

Well, good evening, Omar. I will take the first question, and I will hand over to François for number two and number three. As regards to the process on Lagarde Hereditis, we are in phase two, and during that phase two, we received a statement of objections that we are currently working to provide all answer required as regard to our remedies. And the remedies is based on the cell of Editis through distribution listing. And there are discussion and back and forth momentum with the European Commission with what I would mention as being a very constructive dialogue as regard to providing answers to be able to get the agreement to complete the transaction. We mentioned that our intention is to be able to answer the statement of objection by mid-March and very soon after to propose our final remedies. We are working along those lines. The decision of the European Commission is expected by the end of May, and the end of the process as regards to end of June is based on the agreement about the future controlling shareholder of Editis. About confidence, I will be confident when we'll get a final positive answer, but what I can share with you is that we have a kind of a guideline and we have an objective, but obviously we are working on a different possible alternative, bearing in mind that at the end of the day, what is our ultimate goal is to get the approval to be able to complete this operation with Groupe Lagardère.

Francois? Thank you, Arnaud. Good evening, Omar. The answer on the treasury share, as I said, we have 7.1% of treasury share, and we have around 42 million of share that should be canceled during the second half. It's almost 4% of our capital. Concerning Avas, first question was concerning the difference between the net revenue and the gross revenue. It's mainly coming during the fourth quarter of an event which has been launched in Saudi Arabia, which is a big event, with 100 million of invoicing, most of them being pass-through costs that generates the variance between the two KPI. It will maybe have the same event next year, but it clearly has been computed during the fourth quarter. Concerning the 2023 guidance of Avaas in terms of organic growth, we have followed the guidance of our main peers, which is between, let's say, two for the less optimistic to five for the more optimistic, and we are exactly in the same range than our peers for our 23 forecast. Merci beaucoup.

Thank you very much, sir. Next question is coming from Julien.

Colleague for Barclays, please go ahead. My three questions. The first one on the 42 million shares you said you would cancel in the second half. It's probably not in one go, but in several lots. So if we could get some idea of the timing of those 42 million. Among the second half, that's my first question. The second one is, can we have an update on Cana Plus V80? We should have had a resolution, but we're still waiting. And that's the second question. And then the third one is, what are your intentions regarding your Universal Music stake? Thank you.

Okay, Arnaud, if you're okay, I take the first two. And Arnaud will answer on the question three. First of all, the 42 million, you're right, it's in three batches. To be very precise, it's 2 million in July. It's a limit, so we are not forced to do that exactly in July. It's no later than if we want to cope with 24-month commitments. 37 in September, 3 million in October. I think you may ask the next question in when Bolloré should be in a position to cross the threshold of 30%. it will be during the second batch of July. And to answer another of your questions, they are fully aware of these figures and know the impact of the cancellation on their own stake. Concerning the VAT of Canal+. Let's remind that we are in discussions, as I said during the last call, we are still going back and forth with the French tax authority on this very important program. The French tax authority keeps on considering that Canal Plus is delivering, let's say, a service, a right of access to audiovisual services, including the TV services. We in Canal Plus consider that the fact is totally different, that we are mainly delivering TV services. To prove this, as I said earlier, we look at the number of viewing, the share of viewing of Canal Plus program, which is 80% in linear TV. Another way to convince the French tax authority that if we consider the spend of program costs, 90% of our program costs are spent on linear content such as Formula One, Champions League, sport and other cinema. So we try to convince the French tax authority that with the new system which has been launched in 2021 in which we split the different services with two different rates of VAT One of 10% for the pure TV services and one on 20% for the other services, including catch up. We consider we should get an agreement on this proposal, but today we are still in negotiation with them and we are waiting for their green light on our proposal.

Thank you. Well, on your question, Julien, on the Universal Music Group, well, you've seen the results which have been announced, disclosed on the 2nd of March. Well, with the growth of free cash flow by 70% year-on-year, with revenues increased by 13.6% and EBITDA by 12.5%, I would say that we are a happy shareholder at Universal Music Group. and supportive of the strategy which is followed by Sir Lucien Grange and his team. So we don't have specific intention rather than to benefit and to support what has been proven a successful set of results. Nothing to add on that question.

Super. Merci beaucoup.

Thank you very much, sir. Next question is coming from Mr. Conor O'Shea, calling from Kepler, Chevrolet. Please go ahead, sir.

Yes, thank you. Good evening, everybody. Three questions from my side as well. First question, just to follow up on Canal Plus. In 2023, do you have any more visibility on your intentions in terms of keeping or reselling some of your Champions League or Europa League rights? Se Unsp-Adr Se Unsp-Adr Se Unsp-Adr Se Unsp-Adr Se Unsp-Adr And then the third question, if we could just have a number perhaps on the restructuring costs in the touring business that you mentioned were a one-off in 2022. Thank you.

Okay, thank you. I will take the first question and François, the two other ones. So on Canal+, 2023, you've seen the solid numbers that have been released. No need to say that the offer of Canal Plus Group, which has been structured by the team led by Maxime Sada, is very compelling. And despite a very competitive environment, we have secured rights in terms of major competitions. We're very happy about the Champions League, which has great results. We are going from strength to strength as regards to the performance of the Formula 1, which is a big success. And as regards to the relationship with Big Studio, we have secured a strong relationship with them, providing our subscribers with a second-to-known offer, which is helping the development and the growth of Canal+. The last one, as regards to Studio, is the launch of Paramount+. in the Canal Plus offer. So when you see the current situation at the beginning of 2023 and the momentum, which is our momentum, we see a very solid proposition to our subscribers. And we have, under the leadership of the great team at Canal Plus, the willingness to keep it reinforced and develop that very, very, I would say, unique proposition in terms of content. for our very happy subscribers.

Question on Avast. First of all, a few words to remind that Arnaud already elaborated on this, but let's remind that Avast has done an extremely well performance in an industry which is doing very well as well. So it's very important to remind that Avast is really in the game. Sound organic growth. The margin, to answer your question, should keep on increasing in 2023. As you know, you know that the margins are below the one of our peers for the reasons we have explained several times, including our geographical footprint. But we have still room in Avas to increase the margin, even if we anticipate some growth.

We will increase our profitability ratio next year.

Concerning the restructuring of touring business in Vivendi Village, it has been a huge loss, as I said, concerning some losses, all-person losses on events, but also some restructuring costs in order to avoid any losses. This amounted around 15 million of impact for the year 2022, negative impact of 15 million.

Just for the restructuring?

for losses plus restructuring.

Losses plus restructuring.

Okay. Many thanks.

Very clear. Thank you.

Thank you much, sir. We'll now take questions from Ms. Lisa Wang calling from Goldman Sachs. Please go ahead, ma'am.

Hi, good evening. It's Lisa Yang from Goldman. The first question is on Canal+. I saw there was a pretty big improvement in the French operations from 3.5% decline in Q3 to plus 2.5% in Q4. I think your profitability was also better. So I was just wondering, you know, what was the main driver? I think you did raise price. So I'm just wondering, is that the main contributor? If that's the case, should we expect a similar outlook for 2023, basically losing the digital growth and further profit improvement? That's the first question. The second thing is on capital locations. So you ended about with 900 million of net debt. I'm just wondering, like, you know, how you're thinking about the use of cash from here. Do you still intend to do a bit of buyback? I think you still have about 2% left under the current program. And what are the intentions of MLA? Are we talking about bolt-ons, anything large, and which areas? So any call on that would be helpful. And lastly, on Lagardère, I understand your confidence on the deal getting approved, but is there a risk that it doesn't get approved? And if it doesn't, What would you have to do with that? Do you have to sell down or you can keep your current stake but the voting rights remain as it is? So what would happen in that scenario? Thank you.

Thank you for your question. First of all, on Canal+, I think the important thing is to remind that, as you pointed out, we have done a very sound performance in 2022. It's coming from all the areas. In France, we have been able to increase by more than 400,000 our number of subscribers. So it has been really a part of this sound performance. And for the international, it has been an increase of 1.3 million subscribers. So the year, commercially speaking, of Canal+, has really been the strong driver of this performance and make us quite confident for the performance of the year 2023. On the buyback, as I said, we have, I would say, around 3% of treasury share that could be acquired within the plan of 10%. As we said earlier, today it's not really the priority of Vivendi to invest in the treasury share on the short term. It does not mean we won't acquire any treasury share, but it's clearly not the priority. The priority of the team around Arnaud is clearly to invest in our businesses, to reinforce our operation, and to make of all our businesses efficient and fast-growing businesses. That's clearly the priority, and not, for the time being, the buyback of shares. For Lagarde, I will give the floor to Arnaud.

Well, thank you, Lisa. I would say that we definitely don't plan for failure. As I said at the beginning of this Q&A session, we are currently having a constructive discussion with the European Commission on the potential and appropriate remedies, and we have a solid case. We have, I would say, received three solid and serious offers as regards to interest Confirmed by free potential controlling shareholders in the future and within the coming days and before, I would say around mid-March, I have an ODAT that will bring a constructive solution to be able to get the European Commission approval. Thank you.

Next question is coming from Mr. Christophe Charblanc coming from Societe Generale. Please go ahead, sir.

Yes, good evening, Arnaud. Good evening, Francois. Three on my side. The first one was on multi-choice. You have raised your stake to more than 30% recently, and yet I understand your voting rights are capped at 20%. So is there a scenario in which you continue increasing your stake even though your voting rights are The second question is related also to multi-choice. I understand that the contribution of multi-choice will be consolidated as operational equity. Does it mean that there will be a third line below UMG and Lagardère in EBITDA? And the third and final one was on M&A. Last year, you seem to have considered the investment or co-investment with Lionsgate, Star's Place. Can you confirm that that kind of opportunity is definitely out of the picture now? Thank you.

Thank you, Steph. I will try to answer your first two questions, and Arnaud will take the third one. On multi-choice, you're right, we are now above 30%, and we have kept our voting rights at 20%. And today, we still keep open all the options, including the one in which we keep on acquiring some shares. and with this cap of 20%. So all the options are still open. Concerning the consolidation, you're right, we will take inequity. We have taken inequity from 2022 and it's included in the Canal Plus figures. Nevertheless, for the year 22, it was around zero impact. But next year, the impact will be within Canal Plus and not alongside Lagardère and UMG. And for M&A, it's Arnaud who will answer.

Bonsoir, Christophe. So on the Lionsgate Star situation, you have seen that Lionsgate announced the spin-off of its studio business, and as we speak, we are not in a position to comment further. until the new structures are set up. So I won't dwell any further on that situation. Thank you. Merci beaucoup.

Thank you. Thank you much, sir. We'll now go to Mr. Adrien de Saint-Hilaire of Bank of America. Please go ahead, sir.

Thank you very much. So I've got a couple of questions, follow-ups to what you just said a few minutes ago. So on ADTs first, did you only receive interest or offers for a controlling stake, or did you also receive offers for 100%? Secondly, I think Arnaud, you just said to journalists that the bids that were made on TI are well below your target, so what do you exactly intend to do? And then back on this multi-choice situation, I saw that a couple of days ago, a few days ago, they announced a streaming strategic partnership with Sky and Comcast. I'm just a little surprised that they didn't do it with Canal, given the fact that you guys have been partners for some time and that you own a significant stake in the company. So can you just explain why this happened? Thank you very much.

Bonsoir, Adrien. So on the ADT situation, we have ongoing discussion with three serious interests. The interests have been expressed alongside the approach we have in terms of bringing agreeable remedies to the European Commission. and we have ongoing discussion and due diligence with those three players, point number one. Point number two, as regard to team, well, we always say that we do see value within Telecom Italia. This is a situation which has developments on a quasi daily basis. So the current position, which is the Vivendi position on that situation, is to be a very active shareholder. And this is exactly what we are going to do. There are multiple potential scenarios. What we want is to get a scenario that we can support and that will, as a prerequisite, be aligned with the strategic ambition of the the new Italian stakeholder to build an attractive telecom market situation in Italy, and B, that will take position on a company that needs to open a new chapter, i.e. Telecom Italia, and C, which happens to have as a number one shareholder a group called Vivendi, and Vivendi has taken the decision to be able to get the full freedom of action as regard to develop the value and to create value for all the stakeholders within the company and to really make sure that the true intrinsic value within the operation is going to be recognized. You're absolutely right in saying that the current situation, as far as I can read in the press and see the different comments, is not matching those expectations. and that with the willingness of the Italian government as regard to the strategic vision for the market and the company, we're very happy to see how we can be proactive and shareholder to make that happen. So I would say in our view as of this evening, watch the space. But we're going to be very active shareholder. That you can be sure of. Thank you.

Thank you very much, sir.

Yes, just rapidly a few words on the SkyComCast deal with MultiChoice, which has been announced a few days ago. Today, it's clearly too early to elaborate on it. We do not have the full detail of this agreement, which has not been public yet. We will try and discuss with MultiChoice to understand the consequences of this agreement and to see how Canal Plus could be part of it. But today, it's too early to elaborate on it.

Thank you, sir. Next question will be coming from Mr. Richard Erie of UBS. Please go ahead, sir.

Yeah, many thanks. A lot of my questions have been answered already, but just two follow-ups, please. Just going back to the CAM Outlook guidance, can you just be a bit more specific in terms of where you think organic growth will land and EBITDA or EBIT-A would land in 2023? I know there's a number of moving parts with regard to the VAT issues that need to get resolved, but it'd be helpful to try and understand the moving parts, including the equity contributions that will now come from multi-choice. And then just the follow-up question, just going back to Julian's question on the shared cancellation. You said it's 37 million is going to be cancelled. Was that in July? I missed the actual date and that will then take them over the threshold in July. Was that correct?

So, Canal, we do not give any guidance on the evolution of Canal, but as we said several times, we are confident looking at the subscriber base, looking at our ability to manage costs, looking at the very performing businesses in Africa and in other regions of Europe. So today we are confident, and as you said, we'll take advantage of the equity affiliate impact of MultiChoice. So we intend to reinforce and slightly improve our profitability. Concerning the treasury share, not entering too much into detail, but as I said, We have a big amount coming in September, which is the day when the threshold is crossed. It's in September.

Okay, because you said July earlier. I just want to be clear that was September.

No, what I said, or maybe I was mistaken, sorry for that. What I say that we have a total of 42 million from July to October.

Okay.

And the threshold is in September.

Okay, thank you. And just to follow up on the contributions for multi-choice, what's the magnitude we should be thinking about in 2023?

Sorry to answer that, but it's too early as today we have not the full understanding of the multi-choice figures. Multi-choice is delivering very strong EBIT, but then last year has heavy Forex losses, many minority interests. So today we are reviewing with them the impact we will have, but it's too early at this stage. to make a forecast of the impact of 2023. Thank you.

Thank you, Mr. Uri. Next questions are coming from Mr. Matthew Walker, colleague from Credit Suisse. Please go ahead, sir. Thanks a lot. Hi, everybody.

The first question is on, you mentioned the Bolloré Group and the threshold in September. You're probably not going to answer this, Do you have any idea about their intention? Is it to basically sell down their stakes so they remain below the threshold? Or is it their intention to trigger the threshold? And the second question is on Telecom Italia. You've obviously taken the right down there. I guess, would you say that your strategy of sort of media telco cooperation focus on Southern Europe has changed now? and it's a much more sort of global strategy with Pay TV. And the last question is on UMG. You basically said you're a happy holder at the moment, but if you did sell down UMG, could we take it that that money would go into M&A, particularly for Pay TV?

I'll take second and third, and I will leave the first one to Francois. So as regard to Telecom Italia, no, the strategy has not changed. What we decided for reasons that I dwelled on during that call is to get freedom of action. We do consider that this decision is drawing a line in the sand and opening a new chapter. We want value to be created. We want to be able to develop our position in a global approach to the different businesses But clearly, developing our operations in Italy and in Spain is part of the agenda. And as regard to Italy, we do see Italy as a country of opportunity. And after different ups and downs as regard to our story there, we do think that this opening of a new chapter will provide us with opportunities. So there is no change. There is a new era and the capacity potentially to be provided with opportunity to grow our business, bearing in mind that from where we do stand this evening, the highest priority is to create value on our position at Telecom Italia. That's point number two. As regard to UMG, we are a happy shareholder on UMG and we expect to remain a happy shareholder on UMG. Any other plan is not on the agenda. Francois?

Yes, try to close the subject of Bolloré. I absolutely can't give you any information on the Bolloré decision for the coming summer. You should ask them during their results release, which will happen, I think, on the 14th of March. and they certainly will answer. But on our side, we just ensure that they are fully aware of the threshold in July, in September, sorry, but that's clearly then their call to make that decision.

Okay, thank you so much. Thank you. This evening's last question is coming from Sylvia Cuneo, from Deutsche Bank. Please go ahead.

Thank you. Good evening, everyone. Thanks for taking my questions. I just have two left. First one is on AVAS. Thanks for providing a little bit more color on the outlook for 2023. Just wondering if you could help us think about the drivers within that mix, similarly to some of the things your peers talk about with Se Unsp-Adr If you could come back to the EDTA improvement at Canal+, can you help us think about the drivers of this big improvement in 2022 and perhaps share some thoughts about the outlook for StudioCanali in 2023? Thank you.

Sorry, on Canal+, nothing to add to my previous comment that As I said, the year 2022 has been a year of high performances in all the businesses, including Studio Canal, who has performed very well and who has been part of the increase of the results. And on the guidance, just as I said, we keep on forecasting a slight increase of the profitability. Concerning Avas, Your first question was on AVAS?

Yes.

Yes, on AVAS.

Could you please, Silvia, repeat the question because I'm not sure I get it 100%.

Yes, yes, of course. I was just wondering if you could talk a little bit about the performance within AVAS of media activities, creative activities, and if you have some thoughts to share in terms of new, faster-growing areas like your agencies talk about.

Okay. Sorry, thank you for your question. I think the very important thing for Avas, it is one of the reasons why we performed so well in 2022, is that the three business units, Avas Media Group, Avas Creative Group, and Avas SNU are vertical in pharmaceutical business. has done very well. All of them have delivered very sound performance. So that's clearly the reason why we have been able to perform that much. For the future, we keep on investing in all the three business units. Today, the LCEU is the most profitable, the fast growing, but creative and media will still keep our attention in terms of M&A and in terms of cost control, So all the businesses are doing well. And in terms of geography, as I said, we keep on investing outside France. France is only representing now 17% of the Avas revenue. 83% are coming from abroad, mainly North America. But we also develop Asia with the acquisition of Front Network. So we'll keep on focusing on all these growing areas.

Thank you very much.

Thank you, ma'am. Ladies and gentlemen, that will conclude today's Q&A session. I'll turn the call back over to Mr. Arnaud Dupuy-Fontaine for any additional or closing remarks. Thank you.

François and I would like to thank you for your attention and your question. And we look forward to the next meeting, which is going to be held end of July. I wish you all the very best. Good evening. Thank you very much, gentlemen.

Ladies and gentlemen, that will conclude today's conference. Thank you very much for your attendance. You may disconnect.