FL Entertainment: FY 2023 results
Press Release
Paris, 7 March 2024
Full Year 2023 Results
RECORD FINANCIAL PERFORMANCE IN
2023
CAPTURING GROWTH IN ALL BUSINESSES
&EXPANSION INTO LIVE EXPERIENCES THROUGH
M&A
CONFIDENT FOR CONTINUED GROWTH IN
2024
FY 2023 FINANCIAL
HIGHLIGHTS1
-
Revenue up +13.8% to €4,531m pro forma
acquisitions2 in 2023 (+8.5% at current perimeter)
- Adjusted EBITDA3
up +15.0% to €756m pro forma acquisitions2 (+11.8% at current
perimeter), Adjusted EBITDA margin pro forma acquisitions up 20bp
to 16.7% (17.1% at current perimeter)
- Adjusted net
income3 up +6.8% to €323m, net income at €74m
- Adjusted free cash flow
conversion2 of 82%
- Strong liquidity
position of €464m and stable 3.1x leverage ratio (31 Dec.
2023 vs 31 Dec. 2022)
- Successful Banijay debt
refinancing: ~85% of debt maturity extended until
2028-2029
- Proposed dividend of
€0.35 per share, equal to 46% payout ratio on Adjusted net
income
FY 2023 BUSINESS
HIGHLIGHTS1
- Content
production & distribution
- Reinforced leading position in
content market with powerful brands, travelling IP, relentless
creativity and growing content catalogue up +16% to 185,000
hours
- Continued growth (revenue up +5.7%)
in challenging market conditions
- Dynamic strategy to broaden and
monetize IP: new clients, new audiences and new channels
- Successful expansion in 2023 into
live experiences through acquisition of Balich Wonder Studio and
investment in The Independents
- Online sports betting &
gaming
- Outstanding performance in 2023:
increased leading positions in core markets
- Double-digit growth in Unique
Active Players (+23%) and revenue (+19%), supported by best-in
class product and user experience
- Effective diversification both in
terms of products and geographies with casino, poker & turf
increasing at double-digit rates and successful Ivory Coast
expansion
- GamCare certification demonstrates
commitment to highest standards in responsible gaming
- ESG strategy
- Rollout of strategy focused on
inclusion and equality in a safe environment, carbon reduction and
ensuring the highest standards of ethical leadership and ESG
governance
OUTLOOK
- Content
production & distribution: broaden and monetize
content across multiple channels supported by AI; continue to
increase market share in fast-growing and evolving OTT space;
expand footprint in the production of sports shows; capture
opportunities in the fast-growing live experiences production
market and leverage Banijay’s network
- Online sports betting &
gaming: further develop the player base in all countries
and expand footprint in Africa
- 2024 guidance for Adjusted
EBITDA: high single-digit organic growth
François Riahi, CEO of FL Entertainment,
said:
“We delivered record results in
2023, powered by the continued strong performance of both
businesses. Since we listed two years ago, we have increased our
revenue by 30% and our Adjusted EBITDA by 26%, illustrating the
strength of our business model. During this time, our revenues with
OTT players in content production have increased by 75%, and we
have also expanded our activities into the live experiences space
through M&A, which will contribute to growth moving
forward.
In Content production & distribution, 2023
illustrated our strengths in more challenging macroeconomic
conditions, powered by our iconic brands like Big Brother and Star
Academy, the depth of our content catalogue, and new scripted and
non-scripted formats that are in demand from both linear and
streaming clients across the globe. We are also developing
opportunities in exciting areas like sports entertainment, while
further monetizing our IP through digitalization and content
indexing, which represents a new avenue for growth. Our
diversification into the fast-growing live experiences market is
also helping us to become a true multi-disciplinary creative
heavyweight.
In Online sports betting & gaming, we
delivered strong performance across all segments, with significant
double-digit growth in casino, poker and turf revenues
demonstrating the diverse appeal of our best-in-class tech
platform. Underpinned by our resolute commitment to responsible
gaming - with 99% of revenues coming from locally regulated
countries - we developed our leading positions in France, Portugal
and Poland, and successfully expanded into the Ivory Coast, with
more to come in Africa.
Looking ahead to 2024, we are confident that we
will continue to deliver profitable growth across all activities
thanks to our unique positioning in the entertainment industry. One
of our top priorities will also be expanding our free float and
stock liquidity, so that our strong operational performance can
result in value creation for all our shareholders.”
*****
FL Entertainment invites you to its FY 2023 results conference
call on:
Thursday, 7 March 2024, at 6:00pm
CET
Webcast live:You can watch the
presentation on the following
link:https://edge.media-server.com/mmc/p/5kr6ye45/
Dial-in access telephone
numbers:You need to register to the following
link:https://register.vevent.com/register/BI82321d321cd84fbeaa95813fa174dcb4
Slides related to 2023 results are available on
the Group’s website, in the “Investor relations” section:
https://www.flentertainment.com/results-center/
KEY FINANCIALS IN 2023
|
€m |
2022 |
2023 |
% reported change |
% constant currency |
|
|
|
|
|
|
|
Revenue |
4 046.6 |
4 317.6 |
6.7% |
8.5 % |
| Adjusted
EBITDA |
666.1 |
736.7 |
10.6% |
11.8 % |
| Adjusted EBITDA
margin |
16.5% |
17.1% |
|
|
| |
|
|
|
|
| Net
income/(loss) for the period |
(85.2) |
73.6 |
|
|
| Adjusted net
income |
302.6 |
323.2 |
6.8% |
|
| |
|
|
|
|
| Adjusted
free cash flow |
550.6 |
606.2 |
10.1% |
|
| Free cash flow
conversion rate |
82.7% |
82.3% |
|
|
| |
|
|
|
|
|
For the twelve-month period ended |
31 Dec. 2022 |
31 Dec. 2023 |
|
|
|
|
|
|
|
|
| Net financial
debt (reported) |
2 090.8 |
2 280.0 |
|
|
|
Net financial debt / Adjusted EBITDA |
3.1x |
3.1x |
|
|
Refer to the Appendix for definition
2022 figures are adjusted to include proforma
holding costs of -€4.1m for comparison purposes
FY 2023 KEY EVENTS
Expanding into live experiences
production
FL Entertainment expanded into live experiences
production in 2023, supporting its efforts to become an integrated
global entertainment leader. The Group invested in two businesses
with strong positions in fast-growing and fragmented markets. Both
operate with a decentralized organizational structure well-suited
to developing creative talent and have an entrepreneurial culture
and experienced management team with a passion for innovation.
Balich Wonder Studio
In September 2023, Banijay acquired a 52% stake
in Balich Wonder Studio (BWS). Founded in 2013, Balich Wonder
Studio is a global live entertainment group that specializes in
creating, producing, and delivering live shows and experiences. BWS
has a ten-year track record of impressive organic growth, driven by
its three business units – Ceremonies, Exhibits & Brand
Experiences, and Immersive Shows & Destination Experiences.
Major events in 2023 include the inauguration of the Disney Castle
live music experience in Riyadh; the opening of the Bulgari Hotel
in Rome and the opening and closing ceremonies of the
para-Pan-American games in Santiago. Banijay has invested alongside
the founder of the business and has the option to progressively
increase its stake.
The Independents
In June 2023, FL Entertainment acquired a
minority stake in global marketing and communications group The
Independents alongside the founders of the group and its agencies,
with the option to progressively become the majority shareholder by
2026. Founded in 2017, The Independents is a global community for
industry leaders across luxury and lifestyle, with leadership
positions all over the world.
The Independents accelerated its development in
2023 by acquiring six businesses and now owns 11 best-in-class
agencies: Atelier ATHEM, Atelier LUM, Bureau Betak & Bureau
Future, CTZAR, INCA Productions, Karla Otto, K2, Lefty, Prodject
and The Qode.
Bolt-ons M&A and new
partnership
The Forge
In November 2023, Banijay acquired a majority
stake in The Forge, a leading scripted production company in the
UK. Well-established through its award-winning drama productions
such as Marriage, Help and Becoming Elizabeth, The Forge bolsters
Banijay UK’s scripted output as the ninth owned UK label alongside
Kudos, Tiger Aspects and Wild Mercury. Building on its pool of
industry-leading talent, The Forge has several new titles in
production for both linear and streaming platforms, including the
second season of The Buccaneers for Apple TV+ and Shardlake for
Disney+.
New partnership: Hyphenate Media
Group
In October 2023, Banijay acquired a minority
stake in Hyphenate Media Group, a new multi-platform media company
led by Eva Longoria, actress, producer, director, and founder of
production company UnbeliEVAble, and Cris Abrego, Chairman of
Banijay America Group. Hyphenate Media Group produces scripted and
unscripted content and offers strong development opportunities in
the Americas. Banijay has the option to increase its investment
gradually over the coming years.
Broadening content monetization across
multiple channels, leveraging generative AI
In 2023, Banijay took important initiatives to
leverage and monetize further its product offering, as well as
address fast-growing markets and new audiences. Banijay Sports
launched in November 2023, building on the Banijay’s existing
capabilities in sportainment, documentary and digital, via new
partnerships including a new joint venture with Spanish football
league, LaLiga.
Banijay is also capitalizing on digital and
social platforms to reach next generation audiences, complementing
its licensing and merchandising efforts. As an example, a Big
Brother Germany spin-off received 8.8m live views on the Twitch
platform during the 57-hour live stream, while MasterChef World,
the YouTube channel featuring highlights from local versions as
well as new content, has more than 2.2m subscribers.
In parallel, Banijay has started to use AI
technology to further monetize content across multiple channels
including social media and video platforms. As part of this effort,
Banijay is working to create more value by improving the
searchability of its content and meta-data usage, by tagging and
indexing every show or programs throughout the cloud-based content
library.
Banijay debt: successful refinancing and
maturity extension until 2028-29
In 2023, Banijay successfully refinanced around
85% of its debt, extending its Term Loan B by three years to March
2028 and its Senior Secured Notes by four years until May 2029. In
all, Banijay has refinanced and raised a total amount close to
€2.0bn.
In February 2024, Banijay re-priced its €555m
Term Loan B at Euribor +3.75% and its $556m Term Loan B
at SOFR + 3.25%, reducing margins by 75bp and 50bp
respectively.
STRATEGIC PRIORITIES AND
OUTLOOK
The Group’s ambition is to be a leading player
in fast-growing segments of the entertainment industry while
generating long-term sustainable and profitable growth.
Outlook for 2024
The Group expects a positive momentum in 2024,
enabled by its differentiated strengths, the flexibility of its
business model, as well as opportunities stemming from structural
trends and new consumer behaviors.
FL Entertainment is forecasting high-single
digit organic growth for Adjusted EBITDA in 2024 compared to
Adjusted EBITDA in 2023.
In Content production &
distribution, numerous shows are already commissioned
including scripted series such as Marie-Antoinette (second season)
and Carême (new French drama); and returning iconic shows such as
Deal or No Deal in the UK, and MasterChef in the US. In the live
experiences space, there are significant opportunities with
multiple large-scale projects emerging to satisfy evolving consumer
preferences towards immersive and interactive experiences.
Online sports betting &
gaming is expected to benefit from a busy sporting events
calendar in 2024, including major football events such as the
recent Africa Cup of Nations 2023 in Ivory Coast, and the upcoming
UEFA EURO 2024 in Germany and COPA America in the US. This should
support the Group’s strategy to reinforce its leading positions in
core markets and develop further its footprint in Africa.
------------------
As previously communicated, FL Entertainment aims to expand its
free float and stock liquidity in the short to medium term. In this
respect, it continues to review its options and monitor capital
markets.
PROFIT & LOSS – FY 2023
2022 figures are adjusted to include proforma holding costs of
-€4.1m for comparison purposes.
|
In € million |
2022Reported |
2023 |
% reportedchange |
|
|
|
|
|
|
Revenue |
4 046.6 |
4 317.6 |
6.7 % |
| External
expenses |
(2 054.6) |
(2 302.3) |
12.0 % |
| Personnel
expenses excluding LTIP & employment-related earn-out &
option expenses |
(1 287.2) |
(1 257.6) |
(2.3)% |
| Other operating
income & expenses excl. restructuring costs & other
non-recurring items |
(29.0) |
(22.2) |
(23.5)% |
| Depreciation and
amortization expenses net of reversals related to fiction and other
operational provisions |
(9.5) |
1.1 |
|
|
Adjusted EBITDA |
666.1 |
736.7 |
10.6 % |
| Adjusted EBITDA
margin |
16.5% |
17.1% |
|
| |
|
|
|
| Restructuring
costs and other non-recurring items |
(127.3) |
(34.3) |
|
| LTIP
expenses |
(127.3) |
(152.8) |
|
|
Employment-related earn-out and option expenses |
(20.2) |
(13.7) |
|
|
Depreciation and amortization (excl. D&A fiction and other
operational provisions) |
(140.6) |
(135.4) |
|
|
Operating profit/(loss) |
250.6 |
400.5 |
59.8 % |
| |
|
|
|
| Cost of net
debt |
(143.8) |
(195.6) |
|
|
Other finance income/(costs) |
(112.9) |
(48.8) |
|
| Net
financial income/(expense) |
(256.7) |
(244.4) |
(4.8)% |
| Share of net
income from associates & joint ventures |
(2.2) |
(4.3) |
|
|
|
|
|
|
|
Earnings before provision for income taxes |
(8.3) |
151.8 |
|
|
|
|
|
|
| Income tax
expenses |
(76.9) |
(78.2) |
|
|
Profit/(loss) from continuing operations |
(85.2) |
73.6 |
|
|
Net income/(loss) for the period |
(85.2) |
73.6 |
|
|
Attributable to: |
|
|
|
| Non-controlling
interests |
6.9 |
12.8 |
|
|
Shareholders |
(92.1) |
60.8 |
|
|
|
|
|
|
|
Restructuring costs and other non-recurring items |
127.3 |
34.3 |
|
| LTIP and
employment-related earn-out and option expenses |
147.5 |
166.5 |
|
| Other finance
income/(costs) |
112.9 |
48.8 |
|
|
|
|
|
|
|
Adjusted net income |
302.6 |
323.2 |
6.8 % |
CONSOLIDATED REVENUE
On a pro forma basis4 and at constant
currencies, FL Entertainment recorded revenue of €4,531m, equating
to +13.8% growth.
At current perimeter and constant currencies,
revenue was up +8.5% to €4,318m in 2023,. In Q4 2023, FL
Entertainment posted revenue of €1,452m, +10.7% at constant
currencies. This is reflected as follows by business:
|
€m |
Q4 2022 |
Q4 2023 |
%
reportedchange |
% constant currency |
2022 |
2023 |
%reportedchange |
% constant currency |
|
|
|
|
|
|
|
|
|
|
| Production |
920.5 |
918.6 |
(0.2)% |
1.9 % |
2 664.6 |
2 689.0 |
0.9% |
3.3% |
| Distribution |
120.5 |
117.8 |
(2.2)% |
0.5 % |
387.7 |
395.3 |
2.0% |
3.8% |
| Live experiences
& other |
48.8 |
137.4 |
181.3 % |
286.8 % |
159.3 |
237.1 |
48.9% |
51.4% |
|
Content production & distribution |
1 089.8 |
1 173.8 |
7.7 % |
10.1 % |
3 211.6 |
3 321.4 |
3.4% |
5.7% |
|
|
|
|
|
|
|
|
|
|
| Sportsbook |
192.9 |
208.0 |
7.8 % |
6.9 % |
670.1 |
766.4 |
14.4% |
13.9% |
| Casino |
32.9 |
47.8 |
45.2 % |
44.8 % |
104.8 |
154.7 |
47.7% |
47.6% |
| Poker |
15.0 |
17.7 |
18.0 % |
18.0 % |
49.9 |
61.4 |
23.1% |
23.0% |
| Turf |
3.1 |
4.2 |
36.0 % |
36.0 % |
10.3 |
13.7 |
33.3% |
33.3% |
|
Online sports betting & gaming |
243.9 |
277.7 |
13.8 % |
13.1 % |
835.0 |
996.2 |
19.3% |
18.9% |
|
|
|
|
|
|
|
|
|
|
|
TOTAL REVENUE |
1 333.7 |
1 451.5 |
8.8 % |
10.7 % |
4 046.6 |
4 317.6 |
6.7% |
8.5% |
Content production &
distribution5:
Revenue increased by +5.7% to €3,321m in 2023
compared to high comps in 2022 reflecting the catch-up effect after
the Covid period. The performance in 2023 was driven by the
diversity of content – proven superbrands and series renewals,
global circulation of IP as core driver for recurring revenue,
relentless creativity, and an enlarged content catalogue and the
impact of the recent acquisitions6 (Balich Wonder Studio and The
Forge). Over the fourth quarter 2023, revenue rose by +10.1%.
In a challenging macro-economic environment, the
Group content offering was particularly well adapted to serve
clients’ needs, illustrating the attractiveness and proven
popularity of its well-diversified and enriched portfolio.
Strong appetite from streaming
platforms
Global and local streaming platforms continued
to seek more local / non-English content as well as in-demand
content types such as sports documentaries: Examples include
premium scripted Lidia Poët, produced by Groenlandia and aired on
Netflix in Italy; Good Luck Guys picked up by Joyn in Germany, the
seventh territory to adapt the format, after a second season in
Nordics and also being commissioned in Benelux; and sports
documentary Four Kings on Prime Video in the UK.
Against that backdrop, streaming platforms’
share of Content production & distribution7 revenue increased
further in 2023 to 19%, up +6ppts compared to 2021, representing
+75% revenue growth over the past two years.
Content production revenue increased by +3.3% in
2023, driven by returning shows in multiple territories as well as
original content production (71 new scripted shows and 201 new
unscripted shows).
Iconic superbrands, seasons’ recommission and
global IP circulation: Big Brother made a major return to the UK on
ITV after a 5-year hiatus, trending at number 1 on the
broadcaster’s ITVx streaming service; The Buccaneers, the acclaimed
drama from The Forge, has been commissioned for a season 2 on
AppleTV+; Star Academy returned on TF1 in France for its eleventh
season, recording a major prime time success with 4.3m viewers for
the finale; The Fifty, first produced in France with 200m views and
1m App downloads, has been adapted in 2023 for the US Hispanic
market, ranking as the network’s top show with 1.3m viewers for the
finale.
New shows included non-scripted Upside Down, a
game show from Endemol Shine Nederland on Videoland; The Summit, an
Australian Adventure from Endemol Shine Australia, on Nine Network;
Moulin Rouge: Yes We Can Can in the UK; and The A Talks, produced
by Endemol Shine Iberia for Mediaset.
Content distribution revenue increased by +3.8%
to €395m in 2023, driven by continuous demand from both linear TV
and streaming platforms for key non-scripted and scripted content.
The year was marked by the delivery of scripted Marie Antoinette,
now sold to over 147 territories, including the US, the UK,
Australia and several broadcasters across Europe and Latin America.
Lego Masters continued to experience a global success, reaching 20
territories with RTL broadcasting a first season in Hungary, and 46
seasons globally since 2017. This followed a deal for the format
with TBS in Japan and several multi-seasons runs in major markets
including the US and Australia. In 2023, the world’s most
successful cookery TV format MasterChef reached 70 territories.
At the end of December 2023, the content
catalogue increased by a further +16% to 185,000 hours (compared to
December 2022).
Live experiences & other: revenue growth is
mainly attributable to the consolidation of Balich Wonder Studio
for 3 months in 2023.
Online sports betting &
gaming8:
The Group posted a record year, reflected in a
solid growth across all segments, with revenue up +18.9% to €996m
in 2023, even when factoring in the high comparison in 2022 with
the FIFA World Cup. In Q4 2023, revenue rose by +13.1% compared to
Q4 2022.
The overall performance was underpinned by a
combination of ongoing strong momentum from UAP (+23% in 2023) with
a good retention of players from the FIFA World Cup, and an
excellent commercial development. By geography, the Group
reinforced its positions in its core markets while expanding firmly
in recent territory, namely Ivory Coast.
All segments recorded double-digit growth in
2023. Sportsbook revenue rose by +13.9%, with a positive reverse
trend at year-end after an historic low in October led by
unfavorable sports results and a positive impact from the new App.
Online casino, poker and turf posted very solid revenue growth of
+39.3%, partly driven by a brand-new experience and new casino
games, designed to offer an even simpler and more enjoyable user
experience as well as a range of new features.
ADJUSTED EBITDA
On a pro forma basis9 and at constant
currencies, FL Entertainment recorded a +15.0% increase in
Adjusted EBITDA to €756m in 2023, i.e. a 20bp
improvement in Adjusted margin to 16.7%.
At current perimeter and constant exchange
rates, Adjusted EBITDA increased by +11.8% to €737m in 2023,
reflecting a solid level of profitability across all businesses.
This represents an Adjusted EBITDA margin of 17.1%, a 60bp
improvement versus 2022.
|
Adjusted EBITDA - In € million |
2022 |
2023 |
% reportedchange |
% constant currency |
|
|
|
|
|
|
| Content
production & distribution |
472.1 |
493.5 |
4.5% |
6.7% |
| Online sports
betting & gaming |
202.8 |
251.8 |
24.2% |
23.3% |
| Holding |
(8.8) |
(8.7) |
|
|
|
Adjusted EBITDA |
666.1 |
736.7 |
10.6% |
11.8% |
|
|
|
|
|
|
| Content
production & distribution |
14.7% |
14.9% |
|
|
| Online sports
betting & gaming |
24.3% |
25.3% |
|
|
| Holding |
|
|
|
|
|
Adjusted EBITDA margin |
16.5% |
17.1% |
|
|
At a Group level, external expenses rose by
+12.0% to €2,302.3m driven by two elements already reported in 9M
2023: the change in the allocation of free-lancers’ costs at
Content production & distribution between personnel costs and
external expenses as well as higher betting taxes, in line with
activity growth, for Online sports betting & gaming.
Consequently, this also had an impact on personnel expenses
(excluding LTIP and employment-related earn-out & option
expenses) which declined by -2.3% to €1,257.6m.
Proforma Adjusted EBITDA totaled €756m in 2023,
taking into account a 12-month contribution of acquisitions
realized in 2023.
FROM ADJUSTED EBITDA TO ADJUSTED NET
INCOME
Restructuring and other non-recurring
items: -€34.3m in 2023 compared to -€127.3m in 202210.
LTIP expenses totaled -€152.8m
in 2023 compared to -€127.3m in 2022. LTIPs charges reflected new
beneficiaries and were mechanically higher charges during the first
years of the plans as IFRS accounting standards request the vesting
to start from the attribution date regardless of the actual vesting
period. This is in line with Group’s trajectory to record on
average 10% of Adjusted EBITDA as LTIPs expenses.
Employment-related earn-out and option
expenses: -€13.7m in 2023 compared to -€20.2m in 2022.
Net financial result amounted
to -€244.4m in 2023 compared to -€256.7m in 2022. Of this
amount:
- Cost of net debt
totaled -€195.6m in 2023 compared to -€143.8m in 2022. The increase
was mostly explained by (i) one-off costs related to the
cancellation of the old financing fees not fully amortized at the
time of the refinancing of Term Loans B and Senior Secured Notes
and redemption costs of the Senior Secured Notes; (ii) and
increased interest costs on the renewed debts at the Content
production & distribution business.
- Other financial income and
expenses amounted to -€48.8m in 2023 compared to -€112.9m
in 2022, mainly explained by the change in fair value of the
Put/Earn-out debt and other financial instruments, hedging
instruments and currency impact.
Income tax expenses
The tax charge amounted to -€78.2m in 2023
compared to -€76.9m in 2022. Tax in 2022 was particularly high
compared to pretax income given higher taxable results due to the
non-taxable listing fees in 2022.
Adjusted net income rose by
+6.8% to €323.2m in 2023.
FREE CASH FLOW AND NET FINANCIAL
DEBT
The Group’s Adjusted free cash flow (after lease
payments) reached €606.2m in 2023, up +10.1% YoY, driven by the
business performance and disciplined capital expenditures. The
increase in the change in working capital requirement reflected
higher betting taxes’ debt.
Adjusted free cash flow conversion after capex
and leases payment amounted to 82%.
The rise in income taxes paid was mainly
attributable to tax instalments in 2023 based on a higher 2022
base, as well as a catch-up effect in 2023 of the 2022 tax for
which the instalments were based on lower 2021 performance.
Adjusted operating free cash flow stood at
€512.6m in 2023.
|
€m |
2022 |
2023 |
% reportedchange |
| Adjusted
EBITDA |
666.1 |
736.7 |
10.6% |
| Capex |
(68.1) |
(84.1) |
|
|
Total cash outflows for leases that are not recognised as rental
expenses |
(47.3) |
(46.4) |
|
| Adjusted
free cash flow |
550.6 |
606.2 |
10.1% |
|
|
|
|
|
| Change in
working capital* |
(6.8) |
5.5 |
|
|
Income tax paid |
(74.5) |
(99.1) |
|
| Adjusted
operating free cash flow |
469.3 |
512.6 |
9.2% |
*Excludes LTIP paid, exceptional items cash-out,
trade receivables on providers and players’ liabilities
The Group’s net financial debt totaled €2,280m
as of 31 December 2023 compared to €2,091m as of
31 December 2022. The increase in net
financial debt mainly reflected the dividend payment for €148m,
acquisitions and change in financial assets for €196m, LTIP paid
& exceptional items for €78m, €196m interests recognized in
2023 and €84m of others.
As a result, the financial leverage ratio stood
at 3.1x as of 31 December 2023, stable compared to
31 December 2022.
DIVIDEND
FL Entertainment plans to distribute dividends
in respect of the financial year 2023 which will represent at least
one third of Adjusted net income.
The proposed dividend for the financial year
2023 amounts to €148m, i.e. €0.35 per share, representing a 46%
payout ratio on Adjusted net income. It will be paid fully in cash
and will be submitted for approval to the Annual General Meeting on
23 May 2024.
Rollout of ESG strategy
Set on its mission to “Entertain the world” with
a responsible approach, FL Entertainment has positioned
sustainability, equality & inclusion, and well-being at the
heart of its business model with a long-standing commitment to the
highest ESG standards and long-term value creation. In 2023,
FL Entertainment continued to deploy its strategy with a focus
on governance structure, implementing business initiatives, and
close collaboration with both businesses.
Governance
The Group established a Board level HR & ESG
Committee responsible for validating the strategy, as well as
monitoring and overseeing its deployment at business level. In
parallel, Banijay has established three dedicated workstreams on
environment, social and governance, all coordinated by a newly
appointed ESG Director.
Promote inclusion & equality in a
safe environment
Multiple initiatives have been launched in 2023
across the group to promote social values in a safe
environment.
In Content production and distribution, various
initiatives were deployed with a focus on promoting diversity &
equality both on and off-screen. This is building diverse,
supportive, and collaborative teams, while ensuring equal
opportunities for everyone. A specific program (“Belong”), based on
a full set of initiatives (at local and global levels) is in place
worldwide to foster Inclusion & Equality in recruiting,
employee training and awareness, and audiences’ awareness.
Initiatives in 2023 included Banijay Launch, a global accelerator
program that discovers and empowers emerging women creators, and
Baniday, a global initiative where employees help charities, local
governments in their local cities and towns.
On the sports betting and online gaming side,
the Group has placed responsible gaming behaviour at the core of
its business strategy, supported by a team dedicated to preventing
excessive and underage gaming and a robust data-driven AI-based
algorithm. We have developed Betclic Protect program, a
comprehensive player protection program available throughout their
gaming journey. It includes various tools and services that promote
responsible gaming, such as early detection of signs of excessive
gambling as well as numerous ways of assisting players in need.
Within Betclic Protect, key activities in 2023 have included the
second edition of the Safer Gaming week, employee training and
recruitment. Its commitment is also well reflected in the way it
operates its business as a digital company (100% of business
online) and the high proportion (99% in 2023, up 2 ppt compared to
2022) of its revenue generated in locally regulated markets. Thanks
to its strong commitment to player protection, Betclic received in
November 2023 the international standard for Safer Gambling
certified by GamCare, making it the first operator outside the UK
to receive this certification.
Environment
FL Entertainment is committed to monitor and
reduce its carbon footprint both on content and tech production. In
the sports betting and online gaming activities, which is a fully
digital business, we are committed in controlling energy
consumption from IT developments. 2023 marked the first year of
carbon emissions measurement on the content production side, on
2022 data, in partnership with 3Degrees. Banijay has continued to
work actively on sustainable production across its activities,
being a member of the Albert Consortium in the UK and EcoProd in
France, two organizations dedicated to industry carbon footprint
reduction.
In 2024, the Group will continue to develop its
commitments to ESG and deliver on its strategy, reinforcing its
position as a trusted partner to clients, customers and
stakeholders.
Agenda: Q1 2024 results: 15 May
2024
Investor Relations
Caroline Cohen – Phone: +33 1 44 95 23 34 –
c.cohen@flentertainment.com
Marion Heudes – Phone: +33 1 44 95 23 47 -
m.heudes@flentertainment.com
Press Relations
flentertainment@brunswickgroup.com
Hugues Boëton – Phone: +33 6 79 99 27 15
Nicolas Grange – Phone: +33 6 29 56 20 19
About FL Entertainment
FL Entertainment Group is a global entertainment
leader founded by Stéphane Courbit, a 30-year entrepreneur and
entertainment industry pioneer. Our mission is to inspire passion
by providing audiences with engaging and innovative entertainment
experiences. The Group’s activities include content production
& distribution (through Banijay, the world’s largest
independent content producer and distributor) and online sports
betting & gaming (through Betclic, Europe’s fastest-growing
online sports betting platform). In 2023, FL Entertainment recorded
revenue and Adjusted EBITDA of €4,318m and €737m respectively.FL
Entertainment is listed on Euronext Amsterdam (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.
Regulated information related to this
press release is available on the
website:https://www.flentertainment.com/results-center/https://www.flentertainment.com/
APPENDIX
Glossary
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 net of reversals (excluding D&A fiction and
non-recurring provisions). 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 working capital requirements, 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, funding of Gardenia, trade receivables on providers,
cash in trusts and restricted cash, plus players liabilities 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.
Table 1: Revenue breakdown by activity
|
€m |
Q4 2022 |
Q4 2023 |
% reported change |
% constant currency |
2022 |
2023 |
% reported change |
% constant currency |
|
|
|
|
|
|
|
|
|
|
| Production |
920.5 |
918.6 |
(0.2)% |
1.9 % |
2 664.6 |
2 689.0 |
0.9% |
3.3% |
|
Distribution |
120.5 |
117.8 |
(2.2)% |
0.5 % |
387.7 |
395.3 |
2.0% |
3.8% |
| Live experiences
& other |
48.8 |
137.4 |
181.3 % |
286.8 % |
159.3 |
237.1 |
48.9% |
51.4% |
|
Content production & distribution |
1 089.8 |
1 173.8 |
7.7 % |
10.1 % |
3 211.6 |
3 321.4 |
3.4% |
5.7% |
|
|
|
|
|
|
|
|
|
|
| Sportsbook |
192.9 |
208.0 |
7.8 % |
6.9 % |
670.1 |
766.4 |
14.4% |
13.9% |
| Casino |
32.9 |
47.8 |
45.2 % |
44.8 % |
104.8 |
154.7 |
47.7% |
47.6% |
| Poker |
15.0 |
17.7 |
18.0 % |
18.0 % |
49.9 |
61.4 |
23.1% |
23.0% |
| Turf |
3.1 |
4.2 |
36.0 % |
36.0 % |
10.3 |
13.7 |
33.3% |
33.3% |
|
Online sports betting & gaming |
243.9 |
277.7 |
13.8 % |
13.1 % |
835.0 |
996.2 |
19.3% |
18.9% |
|
|
|
|
|
|
|
|
|
|
|
TOTAL REVENUE |
1 333.7 |
1 451.5 |
8.8 % |
10.7 % |
4 046.6 |
4 317.6 |
6.7% |
8.5% |
Table 2: Adjusted operating free cash flow by
activity
|
Content production & distribution - €m |
2022 |
2023 |
% reported change |
|
|
|
|
|
| Adjusted
EBITDA |
472.1 |
493.5 |
4.5% |
| Adjusted EBITDA
margin (%) |
14.7% |
14.9% |
|
|
|
|
|
|
| Capex |
(60.3) |
(73.3) |
|
| Total cash
outflows for leases that are not recognised as rental expenses |
(44.1) |
(42.7) |
|
|
Adjusted free cash flow |
367.8 |
377.5 |
2.7% |
|
|
|
|
|
| Change in
WC(1) |
(12.9) |
(9.9) |
|
| Income tax
paid |
(49.4) |
(48.1) |
|
|
Adjusted Operating free cash flow |
305.3 |
319.5 |
4.6% |
|
Online Sports betting & gaming |
2022 |
2023 |
% reported |
|
|
|
|
change |
| Adjusted
EBITDA |
202.8 |
251.8 |
24.2% |
| Adjusted EBITDA
margin (%) |
24.3% |
25.3% |
|
|
|
|
|
|
| Capex |
(7.9) |
(10.8) |
|
| Total cash
outflows for leases that are not recognised as rental expenses |
(3.3) |
(3.7) |
|
|
Adjusted free cash flow |
191.7 |
237.3 |
23.8% |
|
|
|
|
|
| Change in
WC(2) |
3.5 |
13.5 |
|
| Income tax
paid |
(25.2) |
(51.1) |
|
|
Adjusted Operating free cash flow |
170.1 |
199.7 |
17.4% |
(1) Excluding LTIP payment and exceptional items for Content
production & distribution
(2) Excluding LTIP payment, exceptional items, trade receivables
on providers and players’ liabilities for Online sports betting
& gaming
Table 3: Consolidated statement of cash
flows
|
In € million |
31 Dec. 2022 |
31 Dec. 2023 |
|
Profit/(loss) |
(81.1) |
73.6 |
|
Adjustments: |
706.4 |
641.9 |
| Share of profit
of associates and joint ventures |
2.2 |
4.3 |
| Amortisation,
depreciation, impairment losses and provisions, net of
reversals |
150.5 |
141.8 |
| Employee
benefits LTIP & employment-related earn-out and option
expenses |
147.5 |
166.7 |
| Change in fair
value of financial instruments |
105.4 |
2.7 |
| Income tax
expenses |
76.9 |
78.2 |
| Other
adjustments(1) |
76.8 |
46.0 |
| Cost of
financial debt, lease liabilities and current accounts |
147.2 |
202.2 |
|
Gross cash provided by operating activities |
625.3 |
715.5 |
| Changes in
working capital |
(92.3) |
(99.5) |
| Income tax
paid |
(74.5) |
(99.1) |
|
Net cash flows provided by operating
activities |
458.6 |
517.0 |
| Purchase of
property, plant, and equipment and of intangible assets |
(68.1) |
(84.9) |
| Purchases of
consolidated companies, net of acquired cash |
(37.4) |
(141.7) |
| Investing in
associates and Joint ventures |
- |
(19.9) |
| Increase in
financial assets |
(43.1) |
(101.8) |
| Disposals of
property, plant and equipment and intangible assets |
- |
0.8 |
| Proceeds from
sales of consolidated companies, after divested cash |
(9.1) |
1.2 |
| Decrease in
financial assets |
165.3 |
9.9 |
| Dividends
received |
- |
0.3 |
|
Net cash provided by/(used for) investing
activities |
7.5 |
(336.1) |
| Change in
capital |
363.6 |
0.1 |
| Change in other
securities |
114.4 |
- |
| Dividends
paid |
(1.6) |
(148.2) |
| Dividends paid
by consolidated companies to their non-controlling interests |
(4.3) |
(19.3) |
| Transactions
with non-controlling interests |
(400.8) |
(27.7) |
| Proceeds from
borrowings and other financial liabilities |
20.7 |
1 292.8 |
| Repayment of
borrowings and other financial liabilities |
(399.0) |
(1 069.5) |
| Other cash items
related to financial activities |
(0.0) |
0.0 |
| Interest
paid |
(131.3) |
(195.7) |
|
Net cash flows from (used in) financing
activities |
(438.2) |
(167.6) |
| Impact of
changes in foreign exchange rates |
19.1 |
(29.7) |
|
Net increase (decrease) of cash and cash
equivalents |
46.9 |
(16.5) |
| Cash and cash
equivalents at the beginning of the period |
432.4 |
479.4 |
| Cash and cash
equivalents at end of the period |
479.4 |
462.9 |
(1) Other
adjustments include notably in 2023: i) unrealized foreign exchange
gains; ii) acquisition costs reclassified in “Purchases of
consolidated companies”; and (iii) other financial items
reclassified in “Interests paid” and in 2022 i) unrealized foreign
exchange gains; ii) losses on disposal and liquidation of
subsidiaries; and (iii) IFRS 2 listing costs. Table 4:
Consolidated balance sheet
|
In € million |
31 Dec. 2022 |
31 Dec. 2023 |
|
ASSETS |
|
|
| Goodwill |
2 570.2 |
2 834.0 |
| Intangible
assets |
194.8 |
204.7 |
| Right-of-use
assets |
160.8 |
149.2 |
| Property, plant
and equipment |
59.2 |
70.6 |
| Investments in
associates and joint ventures |
14.0 |
31.7 |
| Non-current
financial assets |
161.7 |
228.5 |
| Other
non-current assets |
35.9 |
36.9 |
|
Deferred tax assets |
51.9 |
58.4 |
|
Non-current assets |
3 248.6 |
3 614.0 |
|
|
|
|
| Inventories and
work in progress |
705.2 |
678.1 |
| Trade
receivables |
496.5 |
588.9 |
| Other current
assets |
288.3 |
357.6 |
| Current
financial assets |
24.7 |
30.2 |
|
Cash and cash equivalents |
479.4 |
464.2 |
| Current
assets |
1 994.1 |
2 119.0 |
|
|
|
|
| TOTAL
ASSETS |
5 242.6 |
5 733.0 |
| EQUITY
AND LIABILITIES |
|
|
| Share
capital |
8.0 |
8.1 |
| Share premiums,
treasury shares and retained earnings (deficit) |
91.7 |
(35.8) |
| Net
income/(loss) - attributable to shareholders |
(88.0) |
60.8 |
|
Shareholders' equity |
11.7 |
33.0 |
| Non-controlling
interests |
6.3 |
20.2 |
|
Total equity |
18.0 |
53.2 |
|
|
|
|
| Other
securities |
130.5 |
139.4 |
| Long-term
borrowings and other financial liabilities |
2 290.3 |
2 551.9 |
| Long-term lease
liabilities |
131.2 |
126.1 |
| Non-current
provisions |
27.7 |
34.3 |
| Other
non-current liabilities |
441.3 |
352.5 |
| Deferred tax
liabilities |
7.4 |
7.9 |
|
Non-current liabilities |
3 028.4 |
3 212.1 |
|
|
|
|
| Short-term
borrowings and bank overdrafts |
349.4 |
358.3 |
| Short-term lease
liabilities |
40.4 |
41.8 |
| Trade
payables |
663.5 |
709.7 |
| Current
provisions |
23.0 |
13.5 |
| Customer
contract liabilities |
693.3 |
750.0 |
| Other current
liabilities |
426.6 |
594.3 |
| Liabilities
classified as held for sale |
|
- |
|
Current liabilities |
2 196.2 |
2 467.7 |
|
|
|
|
| TOTAL
EQUITY AND LIABILITIES |
5 242.6 |
5 733.0 |
Table 5: IFRS consolidated net financial
debt
|
In € million |
31 December 2022 |
31 December 2023 |
| Bonds |
1 330.8 |
1 284.2 |
| Bank borrowings
and other |
1 140.1 |
1 437.3 |
| Bank
overdrafts |
- |
1.5 |
| Accrued interests
on bonds and bank borrowings |
29.6 |
37.2 |
| Vendor loans |
138.4 |
143.5 |
|
Total bank indebtedness |
2 638.9 |
2 903.7 |
| Cash and cash
equivalents |
(479.4) |
(464.2) |
| Funding of
Gardenia |
- |
(79.7) |
| Trade receivables
on providers |
(13.1) |
(60.8) |
| Players'
liabilities |
50.6 |
50.2 |
| Cash in trusts
and restricted cash |
(31.6) |
(31.0) |
|
Net cash and cash equivalents |
(473.5) |
(585.5) |
|
|
|
|
|
Net debt before derivatives effects |
2 165.3 |
2 318.2 |
| Derivatives -
liabilities |
0.0 |
6.4 |
| Derivatives -
assets |
(74.5) |
(44.6) |
|
Net debt |
2 090.8 |
2 280.0 |
Table 6: Cash flow statement
|
|
31 December 2022 |
|
In € million |
Content production & distribution |
Sports Betting & Online Gaming |
Holding |
Total Group |
|
Net cash flow from operating activities |
380.4 |
107.4 |
(29.2) |
458.6 |
|
Cash flow (used in)/from investing activities |
(147.4) |
(16.3) |
171.2 |
7.5 |
|
Cash flow (used in)/from financing activities |
(198.3) |
(106.9) |
(133.0) |
(438.2) |
|
Effect of foreign exchange rate differences |
19.1 |
- |
- |
19.1 |
|
Net increase/(decrease) in cash and cash
equivalents |
53.8 |
(15.8) |
9.0 |
47.0 |
|
Cash and cash equivalents as of 1 January |
342.4 |
87.9 |
2.2 |
432.4 |
|
Cash and cash equivalents as of 30 December |
396.2 |
72.1 |
11.2 |
479.4 |
|
|
31 December 2023 |
|
In € million |
Content production & distribution |
Online sports betting & gaming |
Holding |
Total Group |
|
Net cash flow from operating activities |
370.1 |
162.3 |
(15.4) |
517.0 |
|
Cash flow (used in)/from investing activities |
(238.9) |
(10.4) |
(86.8) |
(336.1) |
|
Cash flow (used in)/from financing activities |
(129.6) |
(130.6) |
92.5 |
(167.6) |
|
Effect of foreign exchange rate differences |
(29.7) |
- |
- |
(29.7) |
|
Net increase/(decrease) in cash and cash
equivalents |
(28.1) |
21.3 |
(9.7) |
(16.5) |
|
Cash and cash equivalents as of 1 January |
396.2 |
72.1 |
11.2 |
479.4 |
|
Cash and cash equivalents as of 30 December |
368.1 |
93.3 |
1.5 |
462.9 |
Table 7: Content production & distribution: Net
financial debt as of 31 December 2023
|
At Banijay level: |
|
|
| In €
million |
31 Dec. 2022 |
31 Dec. 2023 |
|
|
|
|
| Total
Secured Debt (OM definition) |
1 847 |
1 988 |
| Other debt |
339 |
326 |
| SUN |
409 |
409 |
|
Total Debt |
2 595 |
2 722 |
| Net Cash |
(396) |
(368) |
|
Total net financial debt (excl. Earn-out &
PUT) |
2 199 |
2 354 |
| EO &
PUT |
124 |
178 |
|
Total net financial debt (incl earn-out &
PUT) |
2 323 |
2 532 |
|
|
|
|
| Ratios
at Banijay level: |
|
|
| Leverage Ratio,
as presented |
4.46 |
4.49 |
| Adjusted
Leverage Ratio, as presented |
4.71 |
4.82 |
| Senior secured
net leverage ratio |
3.20 |
3.43 |
|
|
|
|
| Cash
conversion rate - Banijay definition* |
74% |
73% |
|
Banijay contribution at FL Entertainment
level: |
|
|
| In €
million |
31 Dec. 2022 |
31 Dec. 2023 |
|
|
|
|
| Total
net financial debt (excl. Earn-out & PUT) |
2 199 |
2 354 |
| Transaction
costs amortization and other |
(74) |
(32) |
| Vendor loan |
- |
- |
| Lease debt (IFRS
16) |
(160) |
(155) |
|
Total net financial debt at FL Entertainment
level |
1 966 |
2 167 |
|
|
|
|
| Derivatives |
(69) |
(38) |
|
Total net financial debt at FL Entertainment level after
derivatives |
1 897 |
2 129 |
Leverage ratio: total Net financial debt / (Adj
EBITDA + shareholder fees + proforma impact from acquisitions)
Adjusted leverage ratio: total net financial
debt including earn-out and puts / (Adjusted EBITDA + shareholder
fees + proforma impact from acquisitions)
Senior secured net leverage ratio: total Senior
Secured Notes + Earn-out – Cash / (Adjusted EBITDA + shareholder
fees + proforma impact from acquisitions)
* Based on free cash flow as defined as follows: Adjusted EBITDA
+ change in working capital – income tax paid – capex
1 Growth at constant currencies, unless indicated differently2
Pro forma acquisitions as if they are consolidated on 1 January
20233 Adjusted EBITDA, Adjusted net income and Adjusted free cash
flow conversion: figures in 2022 are adjusted to include holding
costs of -€4.1m for comparison purposesRefer to the Appendix for
definition4 Pro forma acquisitions as if they are consolidated on 1
January 20235 At constant currencies, unless indicated differently6
Balich Wonder Studio and The Forge consolidated for 3 months and 1
month respectively7 Excludes “Live experiences & other”
revenue8 Revenue growth is at constant currencies9 Pro forma
acquisitions as if they are consolidated on 1 January 202310
Restructuring items in 2022 were mainly related to listing and
transaction fees and costs incurred to realize the listing on
1 July 2022
- FL Entertainment_PR_FY 2023 Results
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