FL Entertainment: H1 2022 Results
Press Release
Paris –
September
29th,
2022
H1
2022 RESULTS
GLOBAL ENTERTAINMENT LEADER REPORTS
DOUBLE DIGIT REVENUE GROWTH ANDSTRONG CASH FLOW
GENERATION
H1
2022 FIGURES
- Revenue growth: €1,801m in H1 2022,
up +18.9% on a reported basis and +15.6% at constant exchange
rates
- Adjusted EBITDA1: €301m, up +16.0%
versus H1 2021, representing an adj. EBITDA margin of 16.7%
- Adjusted net income: €139m up +8.0%
versus €129m in H1 2021
- Net income: -€18.2m versus €24.2m
in H1 2021, due to one-off impact from the Group re-organization
and listing transaction
- Adjusted free cash flow1: €249m,
representing a cash flow conversion of 83%
- Net financial debt / Adj. EBITDA2
ratio adjusted from the transaction: improved to 3.3x as of
June 30, 2022 versus 3.7x as at December 31, 2021
H1 2022 HIGHLIGHTS
- Content production &
distribution
- Revenue up +22%3 with strong
performance across all businesses and geographies
- Solid revenue growth post-Covid
driven by repeat business and new formats
- Original programming: +9% of hours
in catalog versus FY 2021, driven by both linear TV and streaming
platforms
- 8 bolt-on acquisitions 2022 YTD,
enriching creative talent, content and geographic reach
- Sports betting & online gaming
- Revenue from continuing
operations4: +4% in H1 2022 despite high comparison basis due to
Euro 2020 in 2021 and increased activity during Covid-related
lockdowns
- Unique Active Players increased by
+7% in H1 2022 versus H1 2021
- Responsible gaming at the heart of
the strategy
- Successful listing in July
2022
- Strong Group balance sheet:
- Liquidity position: €713m
- Financial debt at fixed rate with
no maturity before 2025
- S&P credit rating on Banijay5
upgraded to B+ in September 2022
OUTLOOK
The Group confirms the 2022 guidance and
mid-term outlook presented at the time of the business combination
and listing.
François Riahi, CEO
of FL Entertainment,
said:
“During H1 2022, FL Entertainment delivered
double-digit revenue and EBITDA growth thanks to a strong
post-Covid recovery in Content production and increased
Distribution revenues. Our Sports betting & online gaming
business performed well and continued to attract new players,
despite the quieter sports calendar in the first-half. Based on the
strength of our H1 performance, we are confirming our revenue and
earnings targets for 2022, as well as our mid-term outlook.
FL Entertainment's listing in July 2022 is the
start of a new chapter for our business and we are delighted to
begin life as a publicly-traded company with such strong momentum.
We enjoy leading positions in attractive and growing segments of
the entertainment industry and are well-placed to capitalize on new
opportunities and continue our track record of delivering
profitable growth.”
*****
FL Entertainment invites you to its H1 2022 results conference
call on:
Thursday,
September
29th
2022, at 6:00pm CET
Webcast live:You can watch the
presentation on the following
link:https://edge.media-server.com/mmc/p/boimbxhf
Dial-in
access telephone numbers:You need
to register to the following
link:https://register.vevent.com/register/BIa4a4a6371e794693a2ab1868251455ef
Slides related to H1 2022 results are available
on the Group’s website, in the “Investor relations” section:
https://fl-entertainment.com/investor-relations/
On September 29, 2022, the board of directors
approved the financial report and the unaudited condensed financial
statements for the half-year ended June 30, 2022.
Accounts are presented under IFRS standards,
unless explicitly mentioned
KEY FINANCIALS IN
H1
2022
€m |
H1 2021 |
H1 2022 |
% change |
% constant currency |
|
|
|
|
|
Group
revenue |
1 514.7 |
1 800.8 |
18.9% |
15.6% |
Adjusted
EBITDA |
259.3 |
300.7 |
16.0% |
|
Adjusted EBITDA
margin |
17.1% |
16.7% |
|
|
|
|
|
|
|
Net income |
24.2 |
(18.2) |
|
|
Adjusted net
income excl. one-off items related to the transaction |
128.5 |
138.7 |
7.9% |
|
|
|
|
|
|
Adjusted
free cash flow |
208.2 |
249.3 |
19.7% |
|
Free cash flow
conversion rate |
80% |
83% |
|
|
|
|
|
|
|
For the twelve-month period ended |
31 Dec. 2021 |
30 June 2022 |
% change |
|
|
|
|
|
|
Net financial
debt (reported) |
2 268.8 |
2 525.0 |
11.3% |
|
Net financial
debt (adjusted from the transaction) |
|
2 155.0 |
|
|
Net financial debt / Adjusted EBITDA |
3.7x |
3.3x |
|
|
H1 2022 – KEY
EVENTS
Business combination
agreement
On May 10, 2022, F.L. Entertainment N.V.,
announced that it had entered into a definitive business
combination agreement with Pegasus Entrepreneurial Acquisition
Company Europe B.V., a special purpose acquisition company ("SPAC")
to become a listed company on Euronext Amsterdam.
The transaction consists of (i) the business
combination of FL Entertainment and Pegasus Entrepreneurs resulting
in a public listing of FL Entertainment on Euronext Amsterdam, (ii)
the equity roll-over of the minority shareholders in the Banijay
Group (Vivendi, Fimalac and De Agostini) and the Betclic Everest
Group (SBM International) to become shareholders of FL
Entertainment, and (iii) raising of €643m of proceeds. The business
combination was completed on July 1, 2022 and provided the Group
with additional capital of around €608m after deduction of the fees
and expenses of the Business Combination, estimated at
approximately €35m. The SPAC provided €114m of additional capital,
while a PIPE Financing and funding from Financière Lov and the SPAC
Sponsors6 provided €229m and €300m, respectively.
Group reorganization
The Group conducted reorganization between
entities within Financière Lov group and with minority interests in
order to achieve the transaction described above. For more details,
please refer to Note 3.1.3 to the Condensed Financial Statements
for the half-year ended June 30, 2022.
Liquidation of Bet-at-home Entertainment
Ltd
On 22 December 2021, Bet-at-home Group announced
the liquidation of Bet-at-home Entertainment Ltd, a Maltese entity
operating the casino activity under license MGA (Malta Gaming
Authority), consolidated at 53.9% as of December 2021, which took
effect in the first half of 2022.
Active M&A strategy at
Content production &
distribution
As part of the strategy to strengthen creative
talents, Banijay continued its selective and disciplined M&A
activity. Over the first half 2022, Banijay realized five bolt-on
acquisitions of well-known production companies in both scripted
and non-scripted formats (eight acquisitions 2022 YTD). Acquired
companies strengthen Banijay’s exposure in the US, UK, Italy, Spain
and France, and brings a specific expertise in a particular field:
1) Légende Films is a high-profile filmmaker in France; 2) ZNAK TV,
an entity of a famous showrunner and executive producer on Fox's
"MasterChef" amongst other large-scale entertainment brands,
operates in the US and the UK; 3) Groenlandia in Italy is focused
on crafting stories with universal appeal that can travel the
world; 4) Toocos Formats in France, creates, develops new formats
for the French and international markets; 5) Pookepsie Films is one
of the most unique scripted production companies in Spain.
POST-CLOSING EVENTS
Business combination successfully
completed
On 1st July 2022, FL Entertainment successfully
completed business combination with Pegasus Entrepreneurs and
listed on Euronext Amsterdam. The first day of trading took place
on 1st July.
Active M&A momentum in
Content production &
distribution
Banijay realized 3 new acquisitions post-H1
2022, as continuing to expand its footprint:
- SONY Pictures Film-und Fernsehen
GmbH in Germany is a home for high-quality, standout entertainment
formats and scripted productions;
- Banijay Kids & Family acquired
UK drama specialists, Kindle Entertainment, and Movimenti, an
Italian production company and animation focused creative hub. The
division is now home to six production labels across France, the UK
and Italy, alongside its distribution.
2022 GUIDANCE
AND MID-TERM OUTLOOK
CONFIRMED
The Group confirms the 2022 guidance and
mid-term outlook presented at the time of the business combination
and listing.
For 2022, FL Entertainment
targets:
- Content production &
distribution: c.€3bn and adjusted EBITDA of c.€450m
- Sports betting & online gaming:
c.€800m and adjusted EBITDA of c.€200m
- Group adjusted cash conversion rate
at around 80%
- Dividend payout ratio to be at
least 33.3% of the Group’s adjusted net income
- Group leverage7 between 3.0x and
3.5x net financial debt / Adjusted EBITDA
For the mid-term prospects:
- Content production &
distribution: mid-single digit annual organic revenue growth and
stable adjusted EBITDA margin
- Sports betting & online gaming:
low teens annual organic revenue growth and stable adjusted EBITDA
margin
- Group adjusted cash conversion rate
at around 80%
- Dividend payout ratio to be at
least 33.3% of the Group’s adjusted net income
- Group net financial debt / Adjusted
EBITDA below 3x
H1 2022 - PROFIT &
LOSS STATEMENT
H1 2022 “Normalized P&L” highlights the
performance of the Group without any impact of one-off items
related to reorganization and business combination as of 5 July
2022 (refer to page 9).
In € million |
H1 2021Reported |
H1 2022Reported |
H1 2022Normalized P&L |
% Changevs H1
2021 |
Revenue |
1 514.7 |
1 800.8 |
1 800.8 |
18.9% |
External
expenses |
(713.3) |
(861.3) |
(861.3) |
|
Personnel
expenses excluding LTIP & employment-related earn-out and
option expenses |
(536.0) |
(628.6) |
(628.6) |
|
Other operating
income and expenses excl. restructuring costs and other
non-recurring items |
(6.6) |
(8.9) |
(9.0) |
|
D&A related
to fiction |
0.4 |
(1.2) |
(1.2) |
|
Adjusted EBITDA |
259.3 |
300.7 |
300.7 |
16.0% |
Adjusted EBITDA
margin |
17.1% |
16.7% |
16.7% |
|
|
|
|
|
|
Restructuring
costs and other non-recurring items |
(14.6) |
5.4 |
12.0 |
|
LTIP &
employment-related earn-out & option exp. |
(79.1) |
(76.6) |
(43.6) |
|
Depreciation and amortization (excl D&A fiction) |
(54.1) |
(59.0) |
(59.0) |
|
Operating profit/(loss) |
111.5 |
170.4 |
210.0 |
88.3% |
|
|
|
|
|
Cost of net
debt |
(66.0) |
(73.6) |
(73.6) |
|
Other finance income/(costs) |
(10.6) |
(85.6) |
10.8 |
|
Net
financial income/(expense) |
(76.6) |
(159.2) |
(62.8) |
-18.0% |
Share of net
income from associates & joint ventures |
(1.4) |
(1.5) |
(1.5) |
|
Earnings before provision for income taxes |
33.6 |
9.7 |
145.7 |
4.3x |
|
|
|
|
|
Income tax
expenses |
(9.4) |
(27.8) |
(27.8) |
|
Profit/(loss) from continuing operations |
24.2 |
(18.2) |
117.8 |
|
Net income/(loss) for the period |
24.2 |
(18.2) |
117.8 |
4.9x |
Attributable to: |
|
|
|
|
Non-controlling
interests |
11.3 |
2.1 |
2.1 |
|
Shareholders |
12.8 |
(20.2) |
115.8 |
|
Restructuring charges and other non-core items |
14.6 |
(5.4) |
(12.0) |
|
LTIP &
employment-related earn-out & option exp. |
79.1 |
76.6 |
43.6 |
|
Other financial
income |
10.6 |
85.6 |
(10.8) |
|
Adjusted Net income |
128.5 |
138.7 |
138.7 |
7.9% |
CONSOLIDATED REVENUE
Group revenue increased by +15.6% at constant
exchange rates to €1,800.8m and +18.9% in absolute terms in H1 2022
(the difference is mainly explained by US$ and £ currencies).
At constant exchange rates, the growth was
driven by the Content production & distribution business,
+22.1%, which strongly recovered after a first half 2021 that was
still heavily impacted by Covid effects. Sports betting &
online gaming business declined by -2.8% due to a high comparison
basis in H1 2021 and discontinued operations in some jurisdictions
at Bet-at-Home8 in the first half. Excluding the impact of
discontinued operations, Sports betting & online gaming
business recorded a solid +4% growth in H1 2022 (constant exchange
rates).
This is reflected as follows by business:
€m |
H1 2021 |
H1 2022 |
% change |
% constant currency |
Production |
929.4 |
1168.3 |
25.7% |
|
Distribution |
110.4 |
159.6 |
44.4% |
|
Other |
66.1 |
76.3 |
15.3 |
|
Content
production &
distribution |
1 106.0 |
1 404.2 |
27.0% |
22.1% |
|
|
|
|
|
Sportsbook |
333.8 |
322.3 |
-3.5% |
|
Casino |
50.0 |
46.5 |
-7.0% |
|
Poker |
21.6 |
23.2 |
7.1% |
|
Other |
3.2 |
4.6 |
44.9% |
|
Sports betting &
online
gaming |
408.7 |
396.6 |
-3.0% |
-2.8% |
|
|
|
|
|
TOTAL REVENUE |
1 514.7 |
1 800.8 |
18.9% |
15.6% |
Content
production &
distribution:
The strong double-digit revenue growth was well
spread across the two activities: Content production was driven by
new show deliveries (such as “Pride and Prejudice” in the US,
“Pekin Express” and “Laura Pausini” in Italy), the return to
seasonal pre-covid production pace in the US (such as “Big Brother
Celebrity”, “Masterchef”), repeat business with formats
recommission (such as “Survivor” in Australia), a favorable
production phasing with early deliveries of programs and, to a
lower extent, bolt-on acquisitions. Distribution also performed
well both with linear TV and streaming platforms for key
non-scripted and scripted formats. This also includes a good trend
in selling new formats in different territories.
Overall, the number of hours of in the catalog
at the end of June 2022 reached about 134,000 hours, up +9% versus
December 2021.
Sports betting &
online gaming:
Revenue decreased by -3.0% in absolute terms to
€396.6m in H1 2022. The decline was largely attributable to a
quieter sports calendar compared with H1 2021 (Euro 2020 football
tournament in June / July 2021), positive impact of lockdowns in
2021 and some activities at Bet-at-home which were discontinued in
the course of 2021.
At constant exchange rates and excluding
discontinued operations in some jurisdictions of Bet-at-home,
revenues of the business were up +4% during the first half with a
solid performance of Betclic entity (+5% revenue growth), while
partly offset by Bet-at-home, down -16%.
Overall, Unique Active Players increased by +7%
in H1 2022 versus H1 2021, illustrating the attractiveness of the
platform. This comes in particular from the permanent enrichment of
product services with high added-value content and a cutting-edge
digital platform, continuing to provide its players with a safe and
responsible gaming environment thanks to the development of
advanced AI tools and processes, putting the player at the core of
business and bringing individual support to players in need.
ADJUSTED EBITDA
Adjusted EBITDA amounted to €300.7m, up +16.0%
in H1 2022, splitting into +31.1% to €198.3m for Content production
& distribution and -4.6% for Sports betting & online gaming
as a result of revenue trend.
Adjusted EBITDA margin came at 16.7% versus
17.1% in H1 2021, demonstrating FL Entertainment sound business
model. Increased profitability of Content production &
distribution mostly derived from increased revenue. Profitability
of Sports betting & online gaming reduced on the back of the
lower performance of Bet-at-home.
The increase in external and personnel expenses
was mainly driven by Content production & distribution, which
grew in lockstep with its revenue growth, illustrating the dynamism
of the activity and variability of the costs.
In € million |
H1 2021 |
H1 2022 |
% change |
|
|
|
|
Content
production & distribution |
151.2 |
198.3 |
31.1% |
Sports betting
& online gaming |
108.2 |
103.2 |
-4.6% |
Holding |
(0.1) |
(0.7) |
|
Adjusted EBITDA |
259.3 |
300.7 |
16.0% |
|
|
|
|
Content
production & distribution |
13.7% |
14.1% |
|
Sports betting
& online gaming |
26.5% |
26.0% |
|
Adjusted EBITDA margin |
17.1% |
16.7% |
|
NORMALIZED P&L:
FROM ADJUSTED EBITDA TO ADJUSTED NET INCOME
H1 2022 Normalized P&L highlights the
performance of the group without any impact of one-off items
related to reorganization & business combination.
Comments thereafter analyze the “Normalized
P&L” in H1 2022 compared to H1 2021 reported P&L.
In € million |
H1 2021Reported |
H1 2022Reported |
H1 2022Adjusted
from merger |
Transaction impact |
H1 2022Normalized P&L |
|
|
|
(1) |
(2) |
(1) – (2) |
Adjusted EBITDA |
259.3 |
300.7 |
300.7 |
- |
300.7 |
Restructuring
costs & other non-recurring items |
(14.6) |
5.4 |
(95.8) |
(107.8) |
12.0 |
LTIP &
employment-related earn-out and option expenses |
(79.1) |
(76.6) |
(76.6) |
(33.0) |
(43.6) |
Depreciation and amortization (excl D&A fiction) |
(54.1) |
(59.0) |
(59.0) |
- |
(59.0) |
Operating profit/(loss) |
111.5 |
170.4 |
69.2 |
(140.8) |
210.0 |
Cost of net
debt |
(66.0) |
(73.6) |
(73.6) |
0.0 |
(73.6) |
Other finance income/(costs) |
(10.6) |
(85.6) |
(82.7) |
(93.5) |
10.8 |
Net financial income/(expense) |
(76.6) |
(159.2) |
(156.3) |
(93.5) |
(62.8) |
Share of net income from associates & joint ventures |
(1.4) |
(1.5) |
(1.5) |
- |
(1.5) |
Earnings before provision for income taxes |
33.6 |
9.7 |
(88.7) |
(234.3) |
145.7 |
Income tax
expenses |
(9.4) |
(27.8) |
(27.8) |
- |
(27.8) |
Profit/(loss) from continuing operations |
24.2 |
(18.2) |
(116.5) |
(234.3) |
117.8 |
Net income/(loss) for the period of
w/h: |
24.2 |
(18.2) |
(116.5) |
(234.3) |
117.8 |
Non-controlling
interests |
11.3 |
2.1 |
2.1 |
- |
2.1 |
Shareholders |
12.8 |
(20.2) |
(118.5) |
(234.3) |
115.8 |
Restructuring costs & other non-recurring items |
14.6 |
(5.4) |
95.8 |
107.8 |
(12.0) |
LTIP &
employment-related earn-out and option expenses |
79.1 |
76.6 |
76.6 |
33.0 |
43.6 |
Other financial
income |
10.6 |
85.6 |
82.7 |
93.5 |
(10.8) |
Adjusted Net income |
128.5 |
138.7 |
138.7 |
0.0 |
138.7 |
One-off items
related to the transaction:
FL Entertainment recorded one-off items from the
Group re-organization and listing transaction that occurred in H1
2022 and until 5 July 2022. They split as follow:
- Restructuring and other
non-recurring items: €108m related to
listing fee and costs incurred to realize the transaction. Under
IFRS, the merger with the SPAC is considered as an equity-settled
share-based payment for a service rendered by the SPAC to list the
Group. This service is valued at €89m and is recorded as a listing
fee.
- LTIP
& employment-related earn-out and
option expenses: €33m
mainly driven by the change in fair value of financial instruments
explained by the LTIP following the upward reassessment of the
Banijay Group’s shares.
- Other finance income /
loss: €94m attributable
mainly to the change in fair value of financial instruments. This
splits into puts re-evaluation and the change in fair value of
Vivendi’s convertible bond derivatives following the upward
assessment of the Banijay Group’s shares. This bond was paid back
as part of the transaction.
Exceptional income from the
deconsolidation of Bet-at-home
Entertainment Ltd
FL Entertainment recorded €12m income mainly
coming from the deconsolidation of Bet-at-home Entertainment Ltd in
H1 2022.
Net financial result
Net financial result amounted to -€62.8m in H1
2022 compared to -€76.6m in H1 2021. Of this amount:
- Cost of
net debt amounted to -€73.6m in H1 2022 vs -€66.0m in H1
2021, mostly attributable to a higher level of interest charges
explained by a timing effect of interest charges related to Betclic
loan issued on 13 December 2021.
- Other financial income and
expenses as of June 2022 amounted to +€10.8m, compared to
- €10.6m for the first half of 2021 mainly explained by gains
on exchange rates and derivates during H1 2022.
Income tax expenses
The tax charge in H1 2022 totaled -€28m compared
to -€9m in H1 2021, representing an effective tax rate of 17.8%
compared with 11.2% respectively.
The change is mostly explained by a particularly low effective
income tax interest rate in H1 2021 due to the use of significant
loss carry-forward in 2021 for Sports betting & online gaming
business.
Adjusted net income
As a result of the above, adjusted net income
rose by +7.9% to €138.7m in H1 2022 from €128.5m in H1 2021.
FREE CASH FLOW AND NET FINANCIAL DEBT IN
H1 2022
HIGH FREE CASH
FLOW CONVERSION IN H1
2022
The Group improved significantly its adjusted
free cash flow in H1 2022 compared to H1 2021 thanks to positive
adjusted EBITDA and tight control of cash expenses: capex remained
stable while change in working capital increased on the back of
timing differences for betting taxes’ payment. The rise in income
taxes paid was attributable to greater use of tax loss
carry-forward in H1 2021.
Adjusted free cash flow conversion after capex
and leases payment amounted to 83%.
€m |
H1 2021 |
H1 2022 |
% change |
Adjusted
EBITDA |
259.3 |
300.7 |
16.0% |
Capex |
(28.8) |
(28.6) |
|
Total cash
outflows for leases that are not recognised as rental expenses |
(22.3) |
(22.8) |
|
Adjusted free
cash flow |
208.2 |
249.3 |
19.7% |
|
|
|
|
Changes in
working capital* |
(62.1) |
(68.9) |
|
Income tax
paid |
(17.4) |
(33.0) |
|
Adjusted operating free
cash flow |
128.7 |
147.4 |
14.5% |
*Excludes LTIP paid and exceptional items
cash-out
SOLID FINANCIAL POSITION
AND DE-LEVERAGING
Including the full impact of the transaction as
of 5 July 2022, net financial debt decreased to €2,155m as of 30
June 2022 compared to €2,269m as of 31 December 2021, primarily
driven by the performance of adjusted EBITDA. The decrease in net
debt came mainly from adjusted free cash flows of the period for
-€147m and cash proceeds received following the transaction, partly
offset by vendor loans for €525m, net acquisitions for €46m and
€74m interests recognized during H1 2022.
Based on net debt adjusted from the transaction,
the Group’s leverage reduced to 3.3x as of 30 June 2022 versus 3.7x
as at 31 December 2021. Group’s financial debt is at fixed rate
with no maturity before 2025.
On a reported basis:
- Cash and cash
equivalents increased to €493m as at 30 June 2022 versus €434m as
at 31 December 2021.
- Liquidity
position came at €713m, including €493m cash and cash equivalents,
€170m from the RCF which remained undrawn and €50m of unused
overdraft.
Agenda
Q3 2022 results: 30 November 2022
Investor Relations
Caroline Cohen – Phone: +33 1 44 95 23 34 –
c.cohen@flentertainment.com
Press Relations
Anne-France Malrieu - afmalrieu@image7.fr
About FL Entertainment
Founded by Stéphane Courbit, a 30-year
entertainment industry pioneer and entrepreneur, FL Entertainment
Group is a global leader in multimedia content and gambling,
combining the strengths of Banijay, the world’s largest independent
producer distributor, with Betclic Everest Group, the
fastest-growing online sports betting platform in Europe. In 2021,
FL Entertainment recorded through Banijay and Betclic Everest
Group, a combined revenue, and adjusted EBITDA, of €3.5bn and €609m
respectively. FL Entertainment listed on Euronext Amsterdam in July
2022.ISIN: NL0015000X07 - Bloomberg: FLE NA - Reuters: FLE.AS
Forward-looking statementsThis
communication contains information that qualifies as inside
information within the meaning of Article 7(1) of the EU Market
Abuse Regulation.
Forward Looking StatementsSome
statements in this press release may be considered ‘forward-looking
statements’. By their nature, forward-looking statements involve
risk and uncertainty because they relate to events and depend on
circumstances that may occur in the future. These forward-looking
statements involve known and unknown risks, uncertainties and other
factors that are outside of our control and impossible to predict
and may cause actual results to differ materially from any future
results expressed or implied. These forward-looking statements are
based on current expectations, estimates, forecasts, analyses and
projections about the industry in which we operate and management's
beliefs and assumptions about possible future events. You are
cautioned not to put undue reliance on these forward-looking
statements, which only express views as at the date of this press
release and are neither predictions nor guarantees of possible
future events or circumstances. We do not undertake any obligation
to release publicly any revisions to these forward-looking
statements to reflect events or circumstances after the date of
this press release or to reflect the occurrence of unanticipated
events, except as may be required under applicable securities
law.
Alternative performance
measuresThe financial information in this release includes
non-IFRS financial measures and ratios (e.g. non-IFRS metrics, such
as adjusted EBITDA) that are not recognized as measures of
financial performance or liquidity under IFRS. The non-IFRS
financial measures presented are measures used by management to
monitor the underlying performance of the business and operations
and, have therefore not been audited or reviewed. Furthermore, they
may not be indicative of the historical operating results, nor are
they meant to be predictive of future results. These non-IFRS
measures are presented because they are considered important
supplementary measurements of FL Entertainment N.V.'s (the
"Company") performance, and we believe that these and similar
measures are widely used in the industry in which the Company
operates as a way to evaluate a company’s operating performance and
liquidity. Not all companies calculate non-IFRS financial measures
in the same manner or on a consistent basis. As a result, these
measures and ratios may not be comparable to measures used by other
companies under the same or similar names. Further information on
the non-IFRS measures can be found in our [reference to
report].
Regulated information related to this
press release is available on the
website:https://fl-entertainment.com/investor-relations/https://fl-entertainment.com/
APPENDIX
Glossary
Transaction: business combination with Pegasus
Entrepreneurial Acquisition Company Europe B.V., a special purpose
acquisition company ("SPAC") to become a listed company on Euronext
Amsterdam as well as the Group’s re-organization
Adjusted EBITDA: for a period
is defined as the Operating Profit for that period excluding
restructuring costs and other non-core items, costs associated with
the long-term incentive plan within the Group (the "LTIP") and
employment related earn-out and option expenses, and depreciation
and amortization (excluding D&A fiction). D&A fiction are
costs related to the amortization of fiction production, which the
Group considers to be operating costs. As a result of the D&A
fiction, the depreciation and amortization line item in the Group's
combined statement of income deviates from the depreciation and
amortization costs in this line item.
Adjusted net income: defined as
net income (loss) adjusted for restructuring costs and other
non-core items, costs associated with the LTIP and employment
related earn-out and option expenses and other financial
income.
Adjusted free cash flow:
defined as adjusted EBITDA adjusted for purchase and disposal of
property plant and equipment and of intangible assets and cash
outflows for leases that are not recognized as rental expenses.
Adjusted
operating free cash flow: defined
as adjusted EBITDA adjusted for purchase and disposal of property
plant and equipment and of intangible assets, cash outflows for
leases that are not recognized as rental expenses, change in WC,
and income tax paid.
Net financial debt: defined as
the sum of bonds, bank borrowings, bank overdrafts, vendor loans,
accrued interests on bonds and bank borrowings minus cash and cash
equivalents, trade receivables on providers, cash in trusts, plus
players liabilities and escrow accounts plus (or minus) the fair
value of net derivatives liabilities (or assets) for that period.
Net financial debt is pre-IFRS 16.
Leverage: adjusted net
financial debt / Adjusted EBITDA
Number of Unique Active
Players: average number of unique players playing at least
once a month in a defined period
Content production
&
distribution: Key
indicators
Key indicators - In €m |
H1 2021 |
H1 2022 |
% change |
% constant currency |
Production |
929.4 |
1168.3 |
25.7% |
|
Distribution |
110.4 |
159.6 |
44.4% |
|
Other |
66.1 |
76.3 |
15.3% |
|
REVENUE |
1 106.0 |
1 404.2 |
27.0% |
22.1% |
|
|
|
|
|
Adjusted EBITDA |
151.2 |
198.3 |
31.1% |
|
Adjusted EBITDA
margin (%) |
13.7% |
14.1% |
|
|
|
|
|
|
|
Capex |
(23.9) |
(24.5) |
|
|
Total cash
outflows for leases that are not recognised as rental expenses |
(20.2) |
(21.2) |
|
|
Adjusted free
cash flow |
107.1 |
152.6 |
42.5% |
|
|
|
|
|
|
Changes in WC
& income tax paid* |
(49.0) |
(81.7) |
|
|
Adjusted operating free
cash flow |
58.1 |
70.9 |
22.1% |
|
Sports betting &
online gaming: Key
indicators
Key indicators - €m |
H1 2021 |
H1 2022 |
% change |
% constant currency |
Sportsbook |
333.8 |
322.3 |
-3.5% |
|
Casino |
50.0 |
46.5 |
-7.0% |
|
Poker |
21.6 |
23.2 |
7.1% |
|
Other |
3.2 |
4.6 |
44.9% |
|
REVENUE |
408.7 |
396.6 |
-3.0% |
-2.8% |
|
|
|
|
|
Adjusted EBITDA |
108.2 |
103.2 |
-4.6% |
|
Adjusted EBITDA
margin (%) |
26.5% |
26.0% |
|
|
|
|
|
|
|
Capex |
(4.9) |
(4.1) |
|
|
Total cash
outflows for leases that are not recognised as rental expenses |
(2.1) |
(1.7) |
|
|
Adjusted free cash flow |
101.2 |
97.4 |
-3.7% |
|
|
|
|
|
|
Changes in WC
& income tax paid* |
(30.5) |
(28.1) |
|
|
Adjusted operating free
cash flow |
70.7 |
69.3 |
-2.0% |
|
*Excluding LTIP and exceptional items payment
Interim consolidated statement of cash
flows
In € million |
30 June 2021 |
30 June 2022 |
Profit/(loss) |
24.2 |
(18.2) |
Adjustments: |
221.2 |
311.8 |
Share of profit/(loss) of associates and joint ventures |
1.4 |
1.5 |
Amortization, depreciation, impairment losses and provisions, net
of reversals |
57.4 |
59.8 |
Employee benefits LTIP & employment-related earn-out and option
expenses |
79.0 |
76.6 |
Change in fair value of financial instruments |
6.7 |
89.7 |
Income tax expenses |
9.4 |
27.8 |
Other adjustments9 |
1.9 |
(19.2) |
Cost of net debt
and current accounts |
65.4 |
75.6 |
Gross cash provided by operating activities |
245.3 |
293.7 |
Changes in
working capital10 |
(97.7) |
(84.2) |
Income tax
paid |
(17.4) |
(33.0) |
Net cash flows provided by operating
activities |
130.2 |
176.4 |
Purchase of
property, plant and equipment and intangible assets |
(28.8) |
(28.6) |
Purchases of
consolidated companies, net of acquired cash |
(14.5) |
(13.9) |
Increase in
financial assets |
(0.8) |
(2.3) |
Disposals of
property, plant and equipment and intangible assets |
0.4 |
- |
Proceeds from
sales of consolidated companies, after divested cash |
4.1 |
2.2 |
Decrease in
financial assets |
0.5 |
0.4 |
Net cash provided by/(used for) investing
activities |
(39.0) |
(42.2) |
Dividends paid
by consolidated companies to their non-controlling interests |
(20.7) |
(1.5) |
Transactions
with non-controlling interests |
(2.1) |
- |
Proceeds from
borrowings and other financial liabilities |
3.1 |
11.1 |
Repayment of
borrowings and other financial liabilities |
(35.1) |
(47.9) |
Other cash items
related to financial activities |
- |
- |
Interest
paid |
(61.2) |
(65.3) |
Net cash flows from/(used in) financing
activities |
(116.0) |
(103.6) |
Impact of
changes in foreign exchange rates |
(8.6) |
25.2 |
Net increase/(decrease) of cash and cash
equivalents |
(33.4) |
55.7 |
|
|
|
Cash and cash
equivalents at the beginning of the period |
388.5 |
432.4 |
Cash and cash
equivalents at end of the period |
355.1 |
488.2 |
|
|
Interim consolidated statement of financial
position
In € million |
31-Dec-2021 |
30-Jun-2022 |
ASSETS |
|
|
Goodwill |
2 493.9 |
2 538.0 |
Intangible
assets |
236.7 |
226.9 |
Right-of-use
assets |
171.1 |
156.3 |
Property, plant
and equipment |
55.3 |
57.5 |
Investments in
associates and joint ventures |
11.1 |
12.6 |
Non-current
financial assets |
83.0 |
103.4 |
Other
non-current assets |
29.6 |
19.9 |
Deferred tax
assets |
47.6 |
34.2 |
Non-current assets |
3 128.3 |
3 148.8 |
|
|
|
Inventories and
work in progress |
676.7 |
824.9 |
Trade
receivables |
463.6 |
541.0 |
Other current
assets |
264.2 |
319.9 |
Current
financial assets |
75.2 |
297.4 |
Cash and cash
equivalents |
434.1 |
492.7 |
Current assets |
1 913.7 |
2 475.8 |
TOTAL
ASSETS |
5 042.0 |
5 624.6 |
|
|
|
EQUITY
AND LIABILITIES |
|
|
Share
capital |
- |
7.6 |
Additional
paid-in capital |
- |
3 719.4 |
Retained
earnings |
73.6 |
(4 077.1) |
Net
income/(loss) - attributable to shareholders |
(43.0) |
(20.2) |
Shareholders' equity |
30.6 |
(370.4) |
Non-controlling
interests |
(36.7) |
0.7 |
Total equity |
(6.2) |
(369.7) |
|
|
|
Other
securities |
- |
114.4 |
Long-term
borrowings and other financial liabilities |
2 457.8 |
2 475.3 |
Long-term lease
liabilities |
143.2 |
127.3 |
Non-current
provisions |
22.0 |
21.9 |
Other
non-current liabilities |
291.7 |
355.6 |
Deferred tax
liabilities |
3.2 |
7.8 |
Non-current liabilities |
2 917.9 |
3 102.4 |
|
|
|
Short-term
borrowings and bank overdrafts |
306.2 |
868.0 |
Short-term lease
liabilities |
40.2 |
40.3 |
Trade
payables |
511.2 |
594.5 |
Current
provisions |
39.1 |
10.8 |
Customer
contract liabilities |
776.9 |
900.0 |
Other current
liabilities |
456.8 |
478.3 |
Current liabilities |
2 130.3 |
2 891.9 |
TOTAL
EQUITY AND LIABILITIES |
5 042.0 |
5 624.6 |
IFRS consolidated net financial debt
In € million |
31-Dec-2021 |
30-Jun-2022 |
Bonds |
1 461.5 |
1 505.2 |
Bank
borrowings |
1 232.5 |
1 278.2 |
Bank
overdrafts |
1.7 |
4.5 |
Accrued
interests on bonds and bank borrowings |
32.7 |
29.0 |
Vendor
loans |
- |
524.5 |
Total bank indebtedness |
2 728.4 |
3 341.4 |
Cash and cash
equivalents |
(434.1) |
(492.7) |
Trade
receivables on providers |
(24.8) |
(10.2) |
Players’
liabilities |
41.7 |
35.6 |
Cash in
trusts |
(22.4) |
(22.5) |
Escrow
account |
- |
(275.0) |
Net cash and cash equivalents |
(439.5) |
(764.8) |
|
|
|
Net debt before derivatives effects |
2 288.8 |
2 576.6 |
Derivatives -
liabilities |
6.1 |
1.8 |
Derivatives -
assets |
(26.2) |
(53.4) |
Net debt |
2 268.8 |
2 525.0 |
Content production &
distribution: net financial debt as at 30 June
2022
Net financial debt - In €m |
31-Dec-2021 |
31-Mar-2022 |
30-June-2022 |
At
Banijay level: |
|
|
|
Total
Secured Debt (OM definition) |
1 805 |
1 809 |
1 871 |
|
|
|
|
Other debt |
296 |
279 |
313 |
SUN |
409 |
402 |
409 |
Total Debt |
2 510 |
2 490 |
2 593 |
|
|
|
|
Net Cash |
(342) |
(312) |
(353) |
Total net financial debt -
(1) |
2 168 |
2 178 |
2 240 |
|
|
|
|
EO &
PUT |
100 |
114 |
116 |
Total net financial debt (incl EO & PUT) |
2 268 |
2 292 |
2 355 |
|
|
|
|
|
|
|
|
At FL
Entertainment level: |
|
|
|
Transaction
costs amortization - (2) |
|
|
(48) |
Lease debt (IFRS
16) – (3) |
|
|
(156) |
Total net financial debt at FL Entertainment level (1) +
(2) + (3) |
2 035 |
|
|
|
|
Derivatives |
|
|
(49) |
Total net financial debt at FL Entertainment
level |
|
|
1 987 |
|
|
|
|
|
|
|
|
Ratios
at Banijay level: |
|
|
|
Leverage Ratio,
as presented |
4.85 |
4.66 |
4.60 |
Adjusted
Leverage Ratio, as presented |
5.07 |
4.91 |
4.84 |
Senior secured
net leverage ratio |
3.50 |
3.45 |
3.35 |
1 Adjusted EBITDA and adjusted free cash flow: refer to the
Appendix for definition2 Net debt: pre-IFRS 163 At constant
exchange rates4 Excluding discontinued operations at Bet-at-home5
Content production & distribution6 Pegasus Acquisition Partners
Holding, Tikehau Capital, Financière Agache SA, Diego De Giorgi and
Jean Pierre Mustier and their affiliates and/or directors7 Net
financial debt: pre-IFRS 168 Bet-at-home Entertainment Ltd
liquidated during the first half 20229 Other adjustments include
notably unrealized foreign exchange gains, and gain/(loss) on
disposal and liquidation of subsidiaries10 Including LTIP paid and
exceptional items cash-out
- FL Entertainment_PR_ H1 2022 Results
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