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Impresa - Key Takeaways from 4Q17 results

7 Mar 2018

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Impresa reported today after market close its 4Q17 results. Impresa disclosed 4Q17 EBITDA of €5.2mn, -23.5%y/y. Adjusted EBITDA rose by 4.9%y/y to €8.8mn, after excluding €3.58mn of restructuring costs booked in 4Q17 (vs. €1.62mn in 4Q16). Net loss stood at €21.5mn in 4Q17 (which compares with a net profit of €3.3mn in 4Q16), including impairment charges due to the sale of real estate (€1.23mn) and the sale of the magazine portfolio (€21.96mn).

The magazine portfolio was disposed in Jan. 18 for €10.2mn, as the group intends to focus on the audiovisual and digital areas. At the end of 2017, Impresa signed a promissory sale and purchase contract for one plot of land owned by SIC. The deed of sale is expected to be signed in FY18 for a value of €3.2mn. A second plot remains for sale (which is expected to result in a similar impairment).

4Q17 revenues came in at €55.4mn (-1.4%y/y). Turnover in the TV segment was flat y/y in 4Q17 at €42.6mn (-1.6%y/y in FY17), mainly due to lower multimedia revenues y/y. TV advertising revenues rose 2.7%y/y in 4Q17 to €28.7mn, or +3.7%y/y in FY17, higher than the advertising television market, reflecting the performance of the generalist channel, the increase in the thematic channels, the performance of digital revenues and the revenues from the celebrations of SIC’s 25th anniversary. Subscription revenues fell 1.7%y/y to €10.7mn in 4Q17 (-0.8%y/y in FY17, with international revenues hit by the devaluation of the USD), while multimedia revenues fell 39.1%y/y to €1.7mn (-41.3%y/y in FY17).

In the press segment, total revenues fell by 7.4%y/y to €12.1mn in 4Q17 (-4.7%y/y in FY17), with advertising revenues down by 3.6%y/y to €6.1mn (-3.2%y/y in FY17). Circulation revenues posted a 4.6%y/y decline in 4Q17 to €5.4mn, or -0.5%y/y in FY17, despite the update of cover prices for most publications and growth from subscription income, mainly in digital subscriptions. Advertising revenues in digital sales rose 11.4%y/y in FY17, and reached nearly 19% of all advertising revenues.

Adjusted EBITDA margin reached 15.9% in 4Q17 (vs. +15.0% in 4Q16), reflecting higher adjusted margins during the quarter in the Television division (19.8% in 4Q17 vs. 18.0% in 4Q16) and lower adjusted margins in the Publishing division (8.8% in 4Q17 vs. 11.0% in 4Q16).

The opex level rose by 1.6%y/y to €50.2mn in 4Q17 (-1.3%y/y in FY17), or -2.5%y/y after adjusting by restructuring costs (-2.8%y/y in FY17), reflecting the group’s strategy of reducing operating costs.

Impresa reported net debt & financial leases of €178.4mn as of Dec 17 vs. €192.7mn recorded in 3Q17 (-€14.3mn q/q or -€4.8mn y/y), 9.3x last 12 months adjusted EBITDA.

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