2013 quarterly results analyst call on q1 - gfk · 2013 quarterly results – analyst call on q1...

© GfK 2013 | 2013 Q1 Results| May 15th 2013 1

2013 QUARTERLY RESULTS –

ANALYST CALL ON Q1 Matthias Hartmann, CEO

Pamela Knapp, CFO

May, 15th 2013


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1. Highlights of Q1 2013

Matthias Hartmann, CEO

2. Financial results of Q1

Pamela Knapp, CFO

3. Q&A

Matthias Hartmann, CEO

Pamela Knapp, CFO

Agenda


Highlights of Q1


1) Consumer Insight segment isolated. WPPs Consumer Insight segment comprises of Kantar, TNS, Millward Brown, and The Futures Company, amongst others.<

Financial Performance in Q1 2013

Total Organic At constant FX rates

-5,3 -2,7

29.0

3,2

1,0

2,5 3,1

0

4,0

Nielsen does not report

organic growth. 1)

Sales growth in % for Q1 2013

Consumer Insight segment

Ipsos does not report

constant FX rates growth.

In EUR million Q1 2012 Q1 2013

Sales 345.1 347.9

Adjusted operating income 33.5 23.0

End of Q1: Order Book 57.5% 55.1%

0,8 0,6

1,7


Key Operational Highlights in Q1

Slow start with clear

uptick in March,

positive momentum in

April

• January and February below expectations

• Strong March order intake

• April indications strong for CC

Emerging markets drive

strong organic growth • APAC and returned strength in CEE / META drive healthy organic growth

Margin impacted

by delayed bookings

and transformation

cost

• CE impacted by slow order intake in first 2 months while cost base is fixed

(e.g. Consumer Panel)

• CC with better start on Consumer Electronics, but strong order intake in

April with Q2 impact

• Formation of global operations centers started

• Audience Measurement new business pipeline up by factor 4 year on year

• Continue rollout of digital platforms

Progress on mid-term

growth levers


In Retail Tracking, we keep growing the Retailer base

Cooperation worldwide not including North-America

• 128.000 retailers worldwide with 425,000 shops (+ 14,4% in 2012), representing a universe

of 2,3 million shops, deliver data every month / week

• Excellent coverage of online shops since 2006 in Western Europe: strong and constant

enlargement of the online sample for Pure Players and Click & Mortars

• Weekly reporting now on 30% of clients

Top 50 Cooperating Retailers - Example

http://www.mercator.com/index.asp


Financial results of Q1


62

2

Good sales growth in CEE/META and APAC

Sales in EUR million

Total Growth

Organic Growth

FX Effect

Northern Europe

142 140

0 0

2012 2013

-1.4%

-1.3%

-0.6%

North America

63 64

0 0

2012 2013

+1.9%

-2.8%

+0.7%

CEE/META

27 30

0 0

2012 2013

+12.6%

+10.9%

-1.2%

Southern and Western Europe

65 64

0 0

2012 2013

-1.7%

-1.7%

Latin America

15 14

2012 2013

Asia and the Pacific

34 36

0 0

2012 2013

+6.1%

+10.6%

-4.5%

-4.5%

+1.3%

-5.8% No FX effect


Rounding differences possible

Slight increase in sales combined with higher cost base did hurt

the profit in both sectors

In EUR million Sales Growth rate in % AOI Margin in %

Q1 2012 Q1 2013 Total Organic Acqui-

sitions Q1 2012 Q1 2013 Q1 2012 Q1 2013

Consumer

Experiences 205.6 206.8 0.6 -0.4 1.9 7.9 2.4 3.8 1.2

Consumer

Choices 137.8 139.8 1.4 2.2 0.1 27.2 23.0 19.7 16.5

Other 1.6 1.3 - - - -1.6 -2.5 - -

Total 345.1 347.9 0.8 0.6 1.2 33.5 23.0 9.7 6.6


Margin has been impacted by costs for structural changes

and delayed order intake

Volume/Cost/

Sales Mix Effect

Companies on

“watch-list” SCOPE CE ramp-up CC ramp-up

Operational

Severance

9.7

6.6

Turkey

Q1 2012 Q1 2013

-0.5 clean-up -1.2 ramp-up -1.4 under-

performance

Q1 2012 AOI-margin compared to Q1 2013 (in pps)

-0.2 -0.3 -0.6 -0.2

-0.4 +0.2

-1.6


Personnel cost increased significantly compared to Q1 2012

4.0

172.8

Other

4.2

Special Effects

0.7

Restructuring

1.1

Business

Ramp up

1.9

Acquisitions

and Newly

Consolidated

160.9

Q1 2012 Q1 2013

Increase + 2.5% + 1.2% + 0.7% + 0.4% + 2.6% + 7.4%

Ramp up in personnel already occurred in 2012 (average FTE: 12,224 / year end FTE: 12,678)

Average personnel cost Q2-Q4/2012: EUR 175m per quarter

Strong cost containment measures are being implemented in order to balance further personnel cost

increase

FTE

11,821

FTE

12,880



Q1 Profit and Loss

In EUR million Q1 2012 Q1 2013 Change

in %

Sales 345.1 347.9 +0.8

Gross income from sales 105.5 98.9 -6.3

EBITDA 41.2 32.2 -21.8

Adjusted operating income 33.5 23.0 -31.5

AOI Margin in per cent1) 9.7 6.6

EBIT 27.4 18.8 -31.3

Other financial income / expenses -4.3 -5.1 -18.5

Tax on income from ongoing business

activity -8.7 -4.9 +44.1

Tax ratio in per cent 37.7 35.5

Consolidated total income 14.4 8.8 -38.5



Highlighted Items down by 2.2 million

In EUR million Q1 2012 Q1 2013 Change

in EUR m

Write-ups and write-downs of additional assets identified on

acquisitions -2.8 -2.5 +0.3

Regular amortization of additional assets from acquisitions -2.8 -2.5 +0.3

Impairment (incl. reversal) of additional assets from acquisitions 0.0 0.0

Income and expenses in connection with share and asset deals +0.2 -0.1 -0.3

Income and expenses in connection with reorganization and

improvement projects -1.2 -1.8 -0.6

Personnel expenses for share-based incentive payments -2.3 -0.7 +1.6

Currency conversion differences -0.5 +0.6 +1.1

Income and expenses related to one-off effects and other exceptional

circumstances -0.1 0.0 +0.1

Highlighted items -6.7 -4.5 +2.2



Operating Cash flow improves to 9.5 million Euro thanks to a strong

decrease in working capital

In EUR million Q1 2012 Q1 2013 Change in

EUR m

Consolidated total income 14.4 8.8 -5.6

Amortization (incl. reversal) 13.8 13.4 -0.4

Changes in inventories, receivables, payables 2.2 25.9 +23.7

Others (non-cash items) -34.3 -43.2 -8.9

Interest result 5.0 4.6 -0.4

Cash flow from operating activity +1.0 +9.5 +8.5

Capital Expenditure -13.0 -14.5 -1.5

Free cash flow before acquisitions, other investments

and asset disposals -11.9 -5.0 +6.9

Acquisitions, other investments and asset disposals -75.1 -27.3 +47.8

Free cash flow after acquisitions, other investments and

asset disposals -87.0 -32.3

+54.7


Guidance for 2013 and 2015 (end of year)

2013

2015

• Organic sales growth of 3 – 4%

• AOI margin of around 13% (around +60 bps)

• End of March 2013, the order book showed 55.1% (2012: 57.5%)

of expected sales for 2013

• Positive order intake trend of March continued in April

• 1.9 – 2bn EUR sales

• This includes sales from future acquisitions (2013 – 2015) of around EUR 100m

• AOI margin in the range of 15 – 16%


YOUR QUESTIONS

2013 quarterly results analyst call on q1 - gfk · 2013 quarterly results – analyst call on q1...

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