FL Entertainment: FY 2022 results
Press Release
Paris – March
16th, 2023
Full-year 2022
results
STRONG FINANCIAL PERFORMANCE
IN LINE WITH GUIDANCESOLID GROWTH
ACROSS BOTH
BUSINESSESSTRONG
FREE CASH FLOW GENERATION AND RAPID DELEVERAGING
MID-TERM OUTLOOK CONFIRMED
2022 HIGHLIGHTS
-
Revenue up +15.7%1 to €4,047m
driven by strong performance of both businesses
- Content production &
distribution: content catalogue up 30% to 160,000 hours, streaming
platform revenues up 61% y/y, 15 bolt on acquisitions in 10
geographies
- Online sports betting & gaming:
Unique Active Player numbers up 25% y/y, partly driven by strong
football World Cup performance
- Adjusted
EBITDA2 rose by +10.0% to €670.2m in
2022, resulting in an EBITDA margin of 16.6%
- Adjusted
net income2 rose to €307m (+8.6% versus
2021), net income stood at -€81m
(2021: -€73m) due to the one-off impact of the Group’s
reorganization and listing
- Further improvement of
Adjusted free cash flow
conversion1 to reach 83% (82% in 2021)
and a record-high €555m in 2022 driven by tight
control of cash expenses and capex
- Continued reduction
of net financial debt to
reach €2,091m, leading to a leverage3 ratio of 3.1x as of 31
December 2022 compared to 3.7x as at 31 December 2021
- Strong
liquidity position (€689m on 2022 year-end),
S&P rating on Banijay4 upgraded to B+ in September 2022, Fitch
Ratings rating on Banijay upgraded to B+ in March 2023
- ESG continued
rollout of initiatives with focus on executing Responsible Gaming
roadmap and fostering Diversity & Inclusion across Group’s
portfolio
- Proposed
dividend of
€0.36 per share, equal to 49% payout ratio on Adjusted net
income
2023 OBJECTIVES & MID-TERM
OUTLOOK
- 2023 objectives in
line with mid-term outlook:
- Revenue: mid-single digit organic
growth for Content production & distribution and double-digit
organic growth for Online sports betting & gaming
- Adjusted EBITDA of around
€710m
- ~80% free cash flow conversion
- Dividend payout ratio of at least
33.3% of the Group’s Adjusted net income
- Mid-term outlook presented at the
time of the business combination and listing confirmed
François Riahi, CEO of FL Entertainment,
said:
“2022 was an outstanding year for FL
Entertainment. As a Group, we delivered strong results in line with
our guidance, demonstrated rapid progress against the strategy
presented at our listing and strengthened our financial
position.
In Content production & distribution, strong
profitable growth is linked both to new shows, including scripted
hits Marie-Antoinette and SAS Rogue Heroes, and the continued
evolution of our unscripted superbrand offering built on powerful
IP such as Masterchef, Big Brother and Survivor which are
relaunching in key markets and entering new territories. This
production, as well as our successful execution of 15 bolt on
acquisitions in 10 territories have driven a 30% increase of our
overall content catalog, cementing our position as the number one
global independent content producer. We are perfectly positioned in
this business to capture market consolidation opportunities going
forward.
In Online sports betting & gaming, the
growth of our revenues has been also very strong, despite a high
comparison base in 2021. The overall number of Unique Active
Players increased by 25%, powered in part by our strong commercial
performance during the football World Cup. Betclic has been the
most downloaded sports betting app in our core markets of France,
Poland and Portugal, and the second most downloaded across Europe,
thanks to our state-of-the-art technology platform which leads the
way in terms of reliability and efficiency. Looking ahead we will
capitalize on increased player numbers to drive continued organic
growth at a high pace.
Fl Entertainment’s first yearly results are a
testimony to the strength of our business model. We are well
positioned to reinforce our leading positions in our structurally
growing markets in 2023 and continue to demonstrate our proven
ability to delivery profitable growth at scale”.
*****
FL Entertainment invites you to its 2022 results conference call
on:
Thursday, March
16th 2023, at 6:00pm
CET
Webcast live:You can watch the
presentation on the following
link:https://edge.media-server.com/mmc/p/4i46xfmv
Dial-in
access telephone numbers:You need
to register to the following
link:https://register.vevent.com/register/BI60d2c660f0f54582b32a5db6f13db8d3
Slides related to 2022 results are available on
the Group’s website, in the “Investor relations” section:
https://www.flentertainment.com/
KEY FINANCIALS IN
2022
€m |
2021 |
2022 |
% change |
% constant currency |
|
|
|
|
|
Group
revenue |
3 497.0 |
4 046.6 |
15.7% |
13.2% |
Adjusted
EBITDA |
609.3 |
670.2 |
10.0% |
|
Adjusted EBITDA
margin |
17.4% |
16.6% |
|
|
|
|
|
|
|
Net income |
(73.4) |
(81.1) |
(10.5%) |
|
Adjusted net income
excl. one-off items related to the transaction |
282.5 |
306.7 |
8.6% |
|
|
|
|
|
|
Adjusted free cash-flow |
497.5 |
554.7 |
11.5% |
|
Free cash flow
conversion rate |
82% |
83% |
|
|
|
|
|
|
|
|
|
|
|
|
For the twelve-month period ended |
31-Dec-21 |
31-Dec-22 |
% change |
|
|
|
|
|
|
Net financial debt
(reported) |
2 268.8 |
2 090.8 |
(7.8%) |
|
Adjusted
EBITDA |
609.3 |
670.2 |
10.0% |
|
Net financial debt / Adjusted EBITDA |
3.7x |
3.1x |
|
|
2022 – KEY
EVENTS
Content production &
distribution: active
year 2022 in M&A
Banijay continued to execute its M&A
strategy in 2022, enriching its content and geographical footprint,
creating economies of scale and contributing to long-term
performance. Banijay completed 15 bolt-on acquisitions5 of
well-known production companies across both non-scripted and
scripted content in 10 countries - the US, Australia, Belgium,
France, Germany, Israel, Italy, the Netherlands, Spain and the
UK:
- Légende
Films (renamed Montmartre Films), a high-profile
filmmaker in France;
-
Znak TV, an
entity created by famous showrunner and executive producer on Fox's
"MasterChef" amongst other large-scale entertainment brands, which
operates in the US and the UK;
-
Groenlandia, an Italian premium
scripted producer;
-
Tooco, a specialist in the
creation, development and management of new formats for the French
and international markets;
- Pookepsie
Films, one of the most unique scripted production
companies in Spain focused on the fantasy, thriller, and horror
space;
- Kindle
Entertainment, a specialist in young adult and family
drama in the UK;
- Movimenti, an
Italian production company and animation focused creative hub;
- SONY Pictures Film
und Fernsehen GmbH, a German producer of high-quality, standout
entertainment formats and scripted content.
- Mam Tor, a
high-end original television drama producer from the UK;
- Beyond
International, a leading Australian producer of
media content with more than 8,000 hours of scripted and
non-scripted in-house and third-party acquired English content
across multiple territories and genres including factual
entertainment, premium documentary and drama;
- MoviePlus
Production, an independent Israeli production
company specialized in drama series, documentaries and
feature-length films;
- Puzzle Media, the
first French production company to deliver extreme and board sports
content in high volume, with top titles including Riding Zone;
-
Jonnydepony, an independent
production label specialising in the development and production of
high-quality drama series;
- Posh Productions
B.V., a storytelling production company working on the
basis of equality between people with a cinematic style; and
- Topkapi
Films B.V., an Amsterdam-based production company
dedicated to new ways of storytelling since 1994, creating
television drama and feature films for the international
market.
Online sports betting &
gaming: strong
performance during the Football World
Cup
In 2022, Betclic continued to demonstrate its
ability to attract and engage passionate sports fans thanks to the
quality of its content and its attractive and robust platform.
Betclic's performance during the World Cup was a
testament to its strong technology infrastructure, its commitment
to security and its ability to deliver a seamless user
experience.
During the tournament, Betclic handled 6 million
odds updates per day, rapidly settling 1.5 million bets just 13
seconds after the end of the football matches. Despite
exceptionally high betting volumes, the platform remained fully
secure, with no security breaches and zero app downtime.
ESG: At the heart of
the FL Entertainment business model
Banijay: improving its position in diversity, inclusion, and
environment
Banijay is committed to ensuring a truly
representative and inclusive workforce and has implemented a
framework to monitor the impact of these initiatives.
This framework has three pillars:
- Create global
employees’ groups (e.g., pride, disability, women-led) to foster
inclusion and promote diversity;
- Create a safe
working environment for all employees; and
- Equip all
employees with a sustainability-led mind-set to reduce carbon
footprint and overall impact on environment.
Banijay aims to create an environment where
employees can perform to the best of their abilities in an
inclusive work culture. In that context, it set up its first
dedicated Diversity & Inclusion Board in 2022 and will go
further in 2023 to effectively drive best practices and initiatives
around the world. Banijay also partnered with 3Degrees to create a
carbon emission measurement system for its operations, which will
be launched in 2023.
Betclic: pursuing the highest standards for responsible
gaming
Betclic puts player protection at the heart of
the company’s strategy and development. It ran three initiatives to
raise attention to responsible gaming through a dedicated campaign,
partnerships with associations with the launch of the first ever
French website to prevent underage gaming as well as a dedicated
communication during the FIFA World Cup Qatar 2022.
As part of its commitment to ensuring the
highest standards, Betclic ran three initiatives to responsible
gaming:
A major responsible
gaming education campaign in France in October
2022, based on four pillars:
- Educate players
via the Betclic app as well as large-scale marketing campaign
focused on playing with control;
- Increase public
awareness to prevent underage gaming
- Deepen training
on risky behavior prevention measures with all Betclic
employees;
- Innovate with a
responsible gaming “lab sprint” made up of 100 Betclic experts
including engineers, product managers and responsible gaming
experts.
Alongside those initiatives, Betclic had
two partnerships with two reference associations
in 2022:
- E-Enfance, to
build the first website for parents to help them prevent teenage
gaming together: www.pasdujeu.fr
- GamCare, a
recognized European expert in the prevention and treatment of
gaming problems.
During the FIFA World Cup, Betclic launched a
communication campaign to raise awareness among
players and public opinion on that matter.
Betclic also initiated actions related to its
social and societal impact including the introduction of a
sustainable mobility package to reduce its environmental
footprint.
More information on the Group’s existing
policies and action plans will be included in chapter 2 of the 2022
Universal Registration Document, that will be published at the end
of April 2023.
FL Entertainment will report annually in its
Universal Registration Document on the progress of its key
non-financial performance indicators.
Business
combination
On 10 May 2022, FL 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, to become a listed
company on Euronext Amsterdam.
The business combination was completed on 1 July
2022 and provided the Group with additional capital of around €608m
after deduction of the fees and expenses of the business
combination, at around €35m. The first day of trading on Euronext
Amsterdam took place on 1 July 2022.
Group reorganization
The Group conducted reorganization between
entities within Financière Lov group and with minority interests in
order to achieve the Transaction described above.
Liquidation of Bet-at-home Entertainment
Ltd
On 22 December 2021, Bet-at-home Group announced
the winding up by the court procedure of bet-at-home.com
Entertainment Ltd, a Maltese entity operating casino activities
under license by the Malta Gaming Authority, consolidated at 53.9%
as of December 2021, which took effect in the first half of
2022.
2022 - PROFIT &
LOSS STATEMENT
2022 “Normalized P&L” highlights the
underlying performance of the Group by removing the impact of
one-off items related to reorganization and business combination
(refer to page 11).
Accounts are presented under IFRS standards,
unless explicitly mentioned.
In € million |
2021Reported |
2022Reported |
2022Normalized |
% change vs 2021 |
Revenue |
3 497.0 |
4 046.6 |
4 046.6 |
15.7% |
External
expenses |
(1 774.1) |
(2 050.6) |
(2 050.6) |
15.6% |
Personnel
expenses excluding LTIP & employment-related earn-out &
option expenses |
(1 095.4) |
(1 287.2) |
(1 287.2) |
17.5% |
Other operating
income (loss) excl. restructuring costs & other non-recurring
items |
(17.6) |
(29.0) |
(29.0) |
64.6% |
Depreciation and
amortization expenses related to D&A fiction |
(0.6) |
(9.5) |
(9.5) |
|
Adjusted EBITDA |
609.3 |
670.2 |
670.2 |
10.0% |
Adjusted EBITDA
margin |
17.4% |
16.6% |
16.6% |
|
|
|
|
|
|
Restructuring
costs and other non-recurring items |
(49.8) |
(127.4) |
(21.7) |
|
LTIP &
employment-related earn-out and option expenses |
(308.0) |
(147.5) |
(114.5) |
|
Depreciation and amortization (excl. D&A fiction) |
(141.1) |
(140.6) |
(140.6) |
|
Operating
profit/(loss) |
110.4 |
254.7 |
393.4 |
3.6x |
|
|
|
|
|
Cost of net
debt |
(135.3) |
(143.8) |
(143.8) |
|
Other finance income/(costs) |
1.9 |
(112.9) |
(16.5) |
|
Net financial
income/(expense) |
(133.4) |
(256.7) |
(160.3) |
20.2% |
Share of net
income from associates & joint ventures |
(1.2) |
(2.2) |
(2.2) |
|
Earnings before provision for income taxes |
(24.2) |
(4.2) |
230.9 |
|
|
|
|
|
|
Income tax
expenses |
(49.2) |
(76.9) |
(76.9) |
|
Profit/(loss) from continuing operations |
(73.4) |
(81.1) |
154.0 |
|
Net income/(loss) for the period |
(73.4) |
(81.1) |
154.0 |
|
Attributable to: |
|
|
|
|
Non-controlling
interests |
(30.4) |
6.9 |
6.9 |
|
Shareholders |
(43.0) |
(88.0) |
147.1 |
|
Restructuring costs and other non-recurring items |
49.8 |
127.4 |
21.7 |
|
LTIP &
employment-related earn-out and option expenses |
308.0 |
147.5 |
114.5 |
|
Other financial income |
(1.9) |
112.9 |
16.5 |
|
Adjusted net
income |
282.5 |
306.7 |
306.7 |
8.6% |
CONSOLIDATED REVENUE
In 2022, Group revenue increased by +13.2% at
constant currency to €4,046.6m, driven by solid growth across its
two business lines. This includes +15.7% in Q4 2022.
On a reported basis, consolidated revenue grew
by +15.7% over the period.
This is reflected as follows by business:
€m |
Q4 2021 |
Q4 2022 |
% change |
% constant currency |
2021 |
2022 |
% change |
% constant currency |
|
|
|
|
|
|
|
|
|
Production |
763.8 |
920.5 |
20.5% |
|
2 263.2 |
2 664.6 |
17.7% |
|
Distribution |
139.0 |
120.5 |
-13.3% |
|
331.8 |
387.7 |
16.9% |
|
Other |
52.9 |
48.8 |
-7.7% |
|
161.0 |
159.3 |
-1.1% |
|
Content production & distribution |
955.7 |
1 089.8 |
14.0% |
12.3% |
2 756.0 |
3 211.6 |
16.5% |
13.3% |
|
|
|
|
|
|
|
|
|
Sportsbook |
143.0 |
193.0 |
34.9% |
|
588.6 |
670.1 |
13.8% |
|
Casino |
25.1 |
33.0 |
31.3% |
|
102.0 |
104.8 |
2.7% |
|
Poker |
12.0 |
15.0 |
24.9% |
|
44.1 |
49.9 |
13.1% |
|
Other |
1.8 |
3.1 |
71.3% |
|
6.4 |
10.3 |
60.7% |
|
Online sports betting & gaming |
181.9 |
244.1 |
34.2% |
34.2% |
741.0 |
835.0 |
12.7% |
12.8% |
|
|
|
|
|
|
|
|
|
TOTAL REVENUE |
1 137.6 |
1 333.7 |
17.3% |
15.7% |
3 497.0 |
4 046.6 |
15.7% |
13.2% |
Content
production &
distribution:
Revenue totaled €3,212m, up +16.5% in absolute
terms and +13.3% at constant currency in 2022. Overall, growth was
fueled by high-quality IP, a comprehensive content offering to
serve clients needs and to a lesser extent the positive impact from
bolt-on acquisitions.
Content production revenue was
up +17.7% to €2,665m in 2022, driven by 216 launches of successful
new non-scripted shows and around 67 new scripted shows.
The Group delivered new shows with universal
appeal across both non-scripted (“Starstruck” in the UK, “Love
Triangle” in Australia), and scripted (“SAS Rogue Heroes” in the
UK, “Marie-Antoinette” in France and “Grantchester” in the UK).
Recommissioned or returning formats generated 69% of Content
production revenue. “Masterchef”, one of the top travelling
formats, was recommissioned in France, and aired in 39 countries in
2022. Other top travelling formats included “Survivor”, showing in
21 territories for its 25th anniversary and “Big Brother” in 33
territories.
Distribution
revenue increased by +16.9% to €388m driven by a
firm demand from both linear TV and streaming platforms (OTT) for
key non-scripted and scripted content such as “You” for Sky and
“Peaky Blinders” for Netflix in the UK.
In 2022, partly due to the delay in production
during Covid, scripted programs’ production has been higher than in
2021 and totaled 24% of Content production & distribution
revenue compared to 20% in 2021.
The share of OTT increased drastically in 2022
to 18% of Content production & distribution revenue, up 5ppts
compared to 2021.
Overall, the number of content hours at the end
of December 2022 increased sharply by +30% compared to 2021 to
~160,000 hours6.
Online sports
betting &
gaming:
The Online sports betting & gaming business
recorded +12.7% revenue growth on a reported basis7 in 2022 (+12.8%
at constant currency) with a strong performance in Q4 2022 (+34.2%)
boosted by the impact of the World Cup.
The football World Cup in Q4 2022 contributed
7.5% of Betclic Group annual sportsbook stakes and 31% in annual
new sportsbook Unique Active Players (UAP). The Group recorded +38%
increase in its UAPs’ base in December 2022 compared to prior to
the World Cup in October 2022.
By division and including Bet-at-home, revenue
rose by +13.8% in sportsbook in 2022 with +25% increase in UAPs, by
+2.7% for online casino due to greater gamification and launch of
new exclusive games (Mega Santos in Portugal), and by +13.1% for
online poker partly linked to cross-sell during the World Cup.
At constant exchange rates and excluding
discontinued Bet-at-home operations in certain jurisdictions,
revenue was up +19% in 2022, driven by the solid continued
performance of Betclic entity (+21%), offsetting the -10% decline
at Bet-at-home. In Q4 2022, growth stood at +36%.
As part of its commitment towards responsible
gaming standards, Betclic primarily operates in regulated markets.
This is illustrated by the proportion of its revenue generated in
locally regulated markets: 96.5% of 2022 revenue.
ADJUSTED EBITDA
Adjusted EBITDA rose by +10.0%
to €670.2m in 2022, on revenue up +15.7% on a reported basis. This
split into +9.1% rise to €472m for Content production &
distribution and +14.8% increase to €202.8m for Online sports
betting & gaming.
In € million |
Q4 2021 |
Q4 2022 |
% change |
2021 |
2022 |
% change |
|
|
|
|
|
|
|
Content
production & distribution |
191.9 |
174.9 |
-8.9% |
432.7 |
472.1 |
9.1% |
Online sports
betting & gaming |
37.5 |
52.1 |
38.9% |
176.6 |
202.8 |
14.8% |
Holding |
- |
(3.2) |
|
(0.1) |
(4.7) |
|
Adjusted EBITDA |
229.4 |
223.8 |
-2.5% |
609.3 |
670.2 |
10.0% |
|
|
|
|
|
|
|
Content
production & distribution |
20.1% |
16.0% |
|
15.7% |
14.7% |
|
Online sports
betting & gaming |
20.6% |
21.3% |
|
23.8% |
24.3% |
|
Adjusted EBITDA margin |
20.2% |
16.8% |
|
17.4% |
16.6% |
|
NORMALIZED P&L: FROM ADJUSTED
EBITDA TO ADJUSTED NET INCOME
Normalized P&L highlights the underlying
performance of the group for 2022 without one-off items related to
reorganization and business combination.
Comments thereafter analyze the “Normalized
P&L” in 2022 compared to 2021 reported P&L.
In € million |
2021Reported |
2022Reported |
Transaction impact |
2022Normalized |
Revenue |
3 497.0 |
4 046.6 |
|
4 046.6 |
External
expenses |
(1 774.1) |
(2 050.6) |
|
(2 050.6) |
Personnel expenses
excluding LTIP & employment-related earn-out & option
expenses |
(1 095.4) |
(1 287.2) |
|
(1 287.2) |
Other operating
income (loss) excl. restructuring costs & other non-recurring
items |
(17.6) |
(29.0) |
|
(29.0) |
Depreciation and
amortization expenses related to D&A fiction |
(0.6) |
(9.5) |
|
(9.5) |
Adjusted EBITDA |
609.3 |
670.2 |
|
670.2 |
Adjusted EBITDA
margin |
17.4% |
16.6% |
|
16.6% |
|
|
|
|
|
Restructuring costs
and other non-recurring items |
(49.8) |
(127.4) |
(105.7) |
(21.7) |
LTIP &
employment-related earn-out and option expenses |
(308.0) |
(147.5) |
(33.0) |
(114.5) |
Depreciation and amortization (excl. D&A fiction) |
(141.1) |
(140.6) |
|
(140.6) |
Operating
profit/(loss) |
110.4 |
254.7 |
(138.7) |
393.4 |
|
|
|
|
|
Cost of net
debt |
(135.3) |
(143.8) |
- |
(143.8) |
Other finance income/(costs) |
1.9 |
(112.9) |
(96.4) |
(16.5) |
Net financial
income/(expense) |
(133.4) |
(256.7) |
(96.4) |
(160.3) |
Share of net income
from associates & joint ventures |
(1.2) |
(2.2) |
- |
(2.2) |
Earnings before provision for income taxes |
(24.2) |
(4.2) |
(235.1) |
230.9 |
|
|
|
|
|
Income tax
expenses |
(49.2) |
(76.9) |
- |
(76.9) |
Profit/(loss) from continuing operations |
(73.4) |
(81.1) |
(235.1) |
154.0 |
Net income/(loss) for the period |
(73.4) |
(81.1) |
(235.1) |
154.0 |
Attributable to: |
|
|
|
|
Non-controlling
interests |
(30.4) |
6.9 |
- |
6.9 |
Shareholders |
(43.0) |
(88.0) |
(235.1) |
147.1 |
Restructuring costs and other non-recurring items |
49.8 |
127.4 |
105.7 |
21.7 |
LTIP &
employment-related earn-out and option expenses |
308.0 |
147.5 |
33.0 |
114.5 |
Other financial income |
(1.9) |
112.9 |
96.4 |
16.5 |
Adjusted net
income |
282.5 |
306.7 |
- |
306.7 |
One-off items related
to the
Transaction:
FL Entertainment recorded one-off items from the
Group reorganization and listing Transaction:
- Restructuring and other
non-recurring items:
€106m related to
listing and transaction fees 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 €86m 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: €96m attributable
mainly to the change in fair value of financial instruments. This
includes 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 a net exceptional
income of +€11m mainly coming from the deconsolidation of
Bet-at-home Entertainment Ltd in H1 2022.
Net financial result
Net financial result amounted to -€160.3m in
2022 compared to -€133.4m in 2021. Of this amount:
- Cost of
net debt totaled -€143.8m in 2022 vs -€135.3m in 2021,
attributable to a higher level of interest charges due to a
currency effect in Content production & distribution and a
timing effect of interest charges related to Betclic loan issued on
13 December 2021.
- Other financial income and
expenses amounted to -€16.5m in 2022, compared to +€1.9m
in 2021, mainly explained by financial instruments in 2022.
Income tax expenses
The tax charge in 2022 rose to -€76.9m compared
to -€49.2 in 2021, due to greater use of tax loss carry-forward in
2021 and a change in country mix.
Adjusted net income
As a result of the above, Adjusted net income
amounted to €306.7m in 2022 compared to €282.5m in 2021.
FREE CASH FLOW AND NET FINANCIAL
DEBT IN 2022
FREE CASH FLOW
CONVERSION
Adjusted free cash flow (after lease payments)
reached €554.7m, up +11.5% in 2022, driven by the business
performance as well as a tight control of cash expenses and capital
expenditures.
The change in working capital reflected the
seasonality of the two businesses.
Adjusted free cash flow conversion after capex
and leases payment amounted to 83%.
The rise in income taxes paid was mainly
attributable to greater use of tax loss carry-forward in 2021.
Adjusted operating free cash flow rose by 11.1%
to €495m in 2022 compared to 2021.
€m |
2021 |
2022 |
% change |
Adjusted
EBITDA |
609.3 |
670.2 |
10.0% |
Capex |
(66.5) |
(68.1) |
|
Total cash
outflows for leases that are not recognised as rental expenses |
(45.2) |
(47.3) |
|
Adjusted Free-cash flow |
497.5 |
554.7 |
11.5% |
|
|
|
|
Change in working
capital* |
(9.2) |
14.7 |
|
Income tax
paid |
(42.7) |
(74.5) |
|
Adjusted operating free cash flow |
445.7 |
495.0 |
11.1% |
*Excludes LTIP paid and exceptional items
cash-out
SOLID FINANCIAL
POSITION AND DE-LEVERAGING
The Group’s Net financial debt declined by €178m
to €2,091m as of 31 December 2022 compared to €2,269m as of 31
December 2021. This reflects the robust business performance over
the year.
Net financial debt mainly came from an increase
in Adjusted free cash flows for -€495m and cash proceeds received
following the transaction (-€121m), partly offset by LTIP paid
& exceptionals for €152m, net acquisitions for €130m and €144m
interests recognized during 2022.
The financial leverage ratio stood at 3.1x as of
31 December 2022, compared to 3.7x as of
31 December 2021, at the low end of 3.0-3.5x 2022
guidance.
The Group’s Net financial debt is at fixed rate
with no maturity before 2025. The Group may, from time to time and
depending on prevailing market conditions, seek to extend the
maturity of, or to refinance, all or part of its financial
indebtedness.
At Banijay level, two agencies recently upgraded
their ratings on its strong performance: B+ by S&P on 15
September 2022 and B+ by Fitch Ratings on 15 March 2023.
DIVIDEND
In line with its strategy presented at the
listing in July 2022, FL Entertainment plans to distribute
dividends in respect of the financial year 2022 which will
represent at least one third of Adjusted net income.
The proposed dividend for the financial year
2022 amounts to €150m, i.e. €0.36 per share, representing a 49%
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
15 June 2023.
2023 OBJECTIVES IN LINE WITH MID-TERM
OUTLOOK
In 2023, growth momentum will remain solid,
driven by:
- Content production &
distribution: continued focus on scripted and unscripted
opportunities from new content and the Group’s rich content
catalogue, as well as meeting client needs through non-scripted
offer of powerful superbrands well suited to the current economic
climate.
- Online sports betting &
gaming: leveraging on increased player numbers generated
in 2022 after the FIFA World Cup to drive increased betting volumes
as well as coming events such as UEFA Champions league, while
focusing on customer centricity and experience through market
leading technology & IT platform.
For the
financial year 2023, FL
Entertainment anticipates the following:
- Revenue:
- Mid-single digit organic growth for
Content production & distribution
- Double-digit organic growth for
Online sports betting & gaming
- Adjusted EBITDA of around
€710M
- ~80% free cash flow conversion
- Dividend payout ratio: at least
33.3% of the Group’s Adjusted net income
MID-TERM OUTLOOK
CONFIRMED
The Group confirms its mid-term outlook
presented at the time of the listing:
- 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: at least
33.3% of the Group’s Adjusted net income
- Group Net financial debt / Adjusted
EBITDA below 3x
Agenda
Q1 2023 results: 30 May 2023
General Shareholders’ Meeting: 15 June 2023
A brand-new website now available
Investor Relations
Caroline Cohen – Phone: +33 1 44 95 23 34 –
c.cohen@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
Founded by Stéphane Courbit, a 30-year
entertainment industry pioneer and entrepreneur, FL Entertainment
Group is a global leader in multimedia content and gaming,
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 2022,
FL Entertainment recorded through Banijay and Betclic Everest
Group, a combined revenue, and Adjusted EBITDA, of €4,047m and
€670m 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.
Regulated information related to this
press release is available on the
website:https://www.flentertainment.com/results-center/https://www.flentertainment.com/
APPENDIX
Glossary
Transaction: business combination with Pegasus
Entrepreneurial Acquisition Company Europe B.V., a special purpose
acquisition company to become a listed company on Euronext
Amsterdam as well as the Group’s reorganization
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
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, 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.
Table 1: Content
production &
distribution: Key
indicators
In €million |
Q4 2021 |
Q4 2022 |
% change |
2021 |
2022 |
% change |
Production |
763.8 |
920.5 |
20.5% |
2 263.2 |
2 664.6 |
17.7% |
Distribution |
139.0 |
120.5 |
-13.3% |
331.8 |
387.7 |
16.9% |
Other |
52.9 |
48.8 |
-7.7% |
161.0 |
159.3 |
-1.1% |
REVENUE |
955.7 |
1 089.8 |
14.0% |
2 756.0 |
3 211.6 |
16.5% |
|
|
|
|
|
|
|
Adjusted EBITDA |
191.9 |
174.9 |
-8.9% |
432.7 |
472.1 |
9.1% |
Adjusted EBITDA
margin (%) |
20.1% |
16.0% |
|
15.7% |
14.7% |
|
|
|
|
|
|
|
|
Capex |
(19.8) |
(23.5) |
18.5% |
(56.0) |
(60.3) |
7.6% |
Total cash
outflows for leases that are not recognised as rental expenses |
(10.5) |
(12.3) |
17.8% |
(41.5) |
(44.1) |
6.1% |
Adjusted free
cash flow |
161.6 |
139.1 |
-14.0% |
335.2 |
367.8 |
9.7% |
|
|
|
|
|
|
|
Change in working
capital requirements* |
90.2 |
94.4 |
4.6% |
(2.4) |
(11.3) |
371.4% |
Income tax
paid |
(9.3) |
(21.7) |
133.6% |
(26.9) |
(49.3) |
82.9% |
Adjusted Operating free cash flow |
242.6 |
211.8 |
-12.7% |
305.9 |
307.2 |
0.4% |
Table 2: Online sports
betting &
gaming: Key
indicators
In € million |
Q4 2021 |
Q4 2022 |
% change |
2021 |
2022 |
% change |
Sportsbook |
143.0 |
193.0 |
34.9% |
588.6 |
670.1 |
13.8% |
Casino |
25.1 |
33.0 |
31.3% |
102.0 |
104.8 |
2.8% |
Poker |
12.0 |
15.0 |
24.9% |
44.1 |
49.9 |
13.1% |
Other |
1.8 |
3.1 |
71.3% |
6.4 |
10.3 |
60.9% |
REVENUE |
181.9 |
244.1 |
34.2% |
741.1 |
835.0 |
12.7% |
|
|
|
|
|
|
|
Adjusted EBITDA |
37.5 |
52.1 |
38.9% |
176.6 |
202.8 |
14.8% |
Adjusted EBITDA
margin (%) |
20.6% |
21.3% |
|
23.8% |
24.3% |
|
|
|
|
|
|
|
|
Capex |
(3.7) |
(1.4) |
-60.6% |
(10.5) |
(7.9) |
-24.8% |
Total cash
outflows for leases that are not recognised as rental expenses |
24.5 |
(0.7) |
|
(3.7) |
(3.3) |
-11.8% |
Adjusted free cash
flow |
58.3 |
49.9 |
|
162.4 |
191.7 |
18.0% |
|
|
|
|
|
|
|
Change working
capital requirements * |
9.6 |
19.9 |
108.1% |
(6.6) |
25.1 |
- |
Income tax
paid |
(3.5) |
(4.1) |
18.4% |
(14.5) |
(25.2) |
74.1% |
Adjusted Operating free cash flow |
64.4 |
65.7 |
2.1% |
141.4 |
191.6 |
35.5% |
*Excluding LTIP and exceptional items payment
Table 3: Consolidated
statement of cash flows
In € million |
31-Dec-2021 |
31-Dec-2022 |
Profit/(loss) |
(73.4) |
(81.1) |
Adjustments: |
656.5 |
706.4 |
Share of
profit/(loss) of associates and joint ventures |
1.2 |
2.2 |
Amortization,
depreciation, impairment losses and provisions, net of
reversals |
168.3 |
150.5 |
Employee benefits
LTIP & employment-related earn-out and option expenses |
308.0 |
147.5 |
Change in fair
value of financial instruments |
(7.4) |
105.4 |
Income tax
expenses |
49.2 |
76.9 |
Other
adjustments(1) |
(1.2) |
76.8 |
Cost of financial
debt, lease liabilities and current accounts |
138.3 |
147.2 |
Gross cash provided by operating activities |
583.0 |
625.3 |
Changes in
working capital |
(136.9) |
(92.3) |
Income tax
paid |
(42.7) |
(74.5) |
Net cash flows provided by operating
activities |
403.5 |
458.6 |
Purchase of
property, plant and equipment and intangible assets |
(66.5) |
(68.1) |
Purchases of
consolidated companies, net of acquired cash |
(26.6) |
(46.1) |
Increase in
financial assets |
(13.3) |
(43.1) |
Proceeds from
sales of consolidated companies, after divested cash |
8.7 |
(9.1) |
Cash received
through merger with Pegasus (including FPA capital increase) |
|
162.6 |
Decrease in
financial assets |
0.5 |
2.7 |
Net cash provided
by/(used for) investing
activities |
(97.1) |
(1.1) |
Change in
capital |
|
363.6 |
Change in other
securities |
|
114.4 |
Dividends
paid |
(95.0) |
(1.6) |
Dividends paid by
consolidated companies to their non-controlling interests |
(115.8) |
(4.3) |
Transactions with
non-controling interests |
53.7 |
(392.1) |
Proceeds from
borrowings and other financial liabilities |
159.8 |
20.7 |
Repayment of
borrowings and other financial liabilities |
(134.8) |
(399.0) |
Interest
paid |
(125.9) |
(131.3) |
Net cash flows from/(used
in) financing activities |
(258.0) |
(429.6) |
Impact of changes
in foreign exchange rates |
(4.4) |
19.1 |
Net increase/(decrease) of cash and cash
equivalents |
43.9 |
47.0 |
|
|
|
Cash and cash
equivalents at the beginning of the period |
388.5 |
432.4 |
Cash and cash
equivalents at end of the period |
432.4 |
479.4 |
(1) Other adjustments include notably unrealized foreign
exchange gains on disposal and liquidation of subsidiaries
Table 4:
Consolidated balance
sheet
In € million |
31-Dec-21 |
31-Dec-22 |
ASSETS |
|
|
Goodwill |
2 493.9 |
2 570.2 |
Intangible
assets |
236.7 |
194.8 |
Right-of-use
assets |
171.1 |
160.8 |
Property, plant
and equipment |
55.3 |
59.2 |
Investments in
associates and joint ventures |
11.1 |
14.0 |
Non-current
financial assets |
83.0 |
161.7 |
Other
non-current assets |
29.6 |
35.9 |
Deferred tax
assets |
47.6 |
51.9 |
Non-current
assets |
3 128.3 |
3 248.6 |
Production of
audiovisual programs - work in progress |
676.7 |
705.2 |
Trade
receivables |
463.6 |
496.5 |
Other current
assets |
264.2 |
288.3 |
Current
financial assets |
75.2 |
24.7 |
Cash and cash
equivalents |
434.1 |
479.4 |
Current assets |
1 913.7 |
1 994.1 |
TOTAL
ASSETS |
5 042.0 |
5 242.6 |
|
|
|
EQUITY
AND LIABILITIES |
|
|
Share
capital |
- |
8.0 |
Share premium
and retained earnings |
73.6 |
91.7 |
Net
income/(loss) - attributable to shareholders |
(43.0) |
(88.0) |
Shareholders'
equity |
30.6 |
11.7 |
Non-controlling
interests |
(36.7) |
6.3 |
Total equity |
(6.2) |
18.0 |
|
|
|
Other
securities |
- |
130.5 |
Long-term
borrowings and other financial liabilities |
2 457.8 |
2 290.3 |
Long-term lease
liabilities |
143.2 |
131.2 |
Non-current
provisions |
22.0 |
27.7 |
Other
non-current liabilities |
291.7 |
441.3 |
Deferred tax
liabilities |
3.2 |
7.4 |
Non-current
liabilities |
2 917.9 |
3 028.4 |
|
|
|
Short-term
borrowings and bank overdrafts |
306.2 |
349.4 |
Short-term lease
liabilities |
40.2 |
40.4 |
Trade
payables |
580.8 |
663.5 |
Current
provisions |
39.1 |
23.0 |
Customer
contract liabilities |
707.2 |
693.3 |
Other current
liabilities |
456.8 |
426.6 |
Current liabilities |
2 130.3 |
2 196.2 |
TOTAL
EQUITY AND LIABILITIES |
5 042.0 |
5 242.6 |
Table 5: IFRS consolidated net
financial debt
In € million |
31-Dec-2021 |
31-Dec-2022 |
Bonds |
1 461.5 |
1 330.8 |
Bank
borrowings |
1 232.5 |
1 140.1 |
Bank
overdrafts |
1.7 |
- |
Accrued
interests on bonds and bank borrowings |
32.7 |
29.6 |
Vendor
loans |
- |
138.4 |
|
|
|
Total bank
indebtedness |
2 728.4 |
2 638.9 |
Cash and cash
equivalents |
(434.1) |
(479.4) |
Trade
receivables on providers |
(24.8) |
(13.1) |
Players'
liabilities |
41.7 |
50.6 |
Cash in trusts and restricted cash |
(22.4) |
(31.6) |
Net cash and cash equivalents |
(439.5) |
(473.6) |
|
|
|
Net debt before derivatives effects |
2 288.8 |
2 165.3 |
Derivatives -
liabilities |
6.1 |
- |
Derivatives -
assets |
(26.2) |
(74.5) |
Net debt |
2 268.8 |
2 090.8 |
Table 6:
Cash flow statement
|
31-Dec-2022 |
In € million |
Content production & distribution |
Online sports betting & gaming |
Holding |
Total Group |
Net cash flow from operating activities |
378.8 |
107.4 |
(27.7) |
458.6 |
Cash flow (used in)/from investing activities |
(147.4) |
(16.3) |
162.6 |
(1.1) |
Cash flow (used in)/from financing activities |
(196.7) |
(106.9) |
(125.9) |
(429.6) |
Impact of changes in foreign exchange rates |
19.1 |
- |
- |
19.1 |
Net increase/(decrease) in cash and cash
equivalents |
53.7 |
(15.8) |
9.0 |
47.0 |
Cash and cash equivalents as of 1 January |
343.1 |
87.9 |
1.5 |
432.4 |
Cash and cash equivalents as of 31 December |
396.8 |
72.1 |
10.5 |
479.4 |
|
31-Dec-2021 |
In € million |
Content production & distribution |
Online sports betting & gaming |
Holding |
Total Group |
Net cash flow from operating activities |
323.6 |
81.4 |
(1.6) |
403.5 |
Cash flow (used in)/from investing activities |
(89.3) |
(7.8) |
- |
(97.1) |
Cash flow (used in)/from financing activities |
(158.7) |
(101.0) |
1.7 |
(258.0) |
Impact of changes in foreign exchange rates |
(4.4) |
- |
- |
(4.4) |
Net increase/(decrease) in cash and cash
equivalents |
71.2 |
(27.4) |
0.1 |
43.9 |
Cash and cash equivalents as of 1 January |
271.9 |
115.2 |
1.4 |
388.5 |
Cash and cash equivalents as of 31 December |
343.1 |
87.9 |
1.5 |
432.4 |
Table 7:
Content production &
distribution: Net
financial debt as of
31 December
2022
At Banijay
level: |
|
|
In
€ million |
31-Dec-2021 |
31-Dec-2022 |
|
|
|
Total
Secured Debt (OM definition) |
1 805 |
1 847 |
Other debt |
296 |
339 |
SUN |
409 |
409 |
Total Debt |
2 510 |
2 595 |
Net Cash |
(342) |
(396) |
Total net financial debt (excl.
Earn-out & PUT) |
2 168 |
2 199 |
EO & PUT |
100 |
124 |
Total net financial debt (incl.
Earn-out &
PUT) |
2 268 |
2 323 |
|
|
|
Ratios at
Banijay level: |
|
|
Leverage
Ratio |
4.85 |
4.46 |
Adjusted Leverage
Ratio |
5.07 |
4.71 |
Senior secured
net leverage ratio |
3.50 |
3.20 |
|
|
|
Banijay contribution at FL Entertainment
level: |
|
|
In
€ million |
31-Dec-2021 |
31-Dec-2022 |
|
|
|
Total net
financial debt (excl. Earn-out
& PUT) |
2 168 |
2 199 |
Transaction costs
amortization |
(54) |
(39) |
Lease debt (IFRS
16) |
(164) |
(160) |
Total Net financial debt
at FL Entertainment level |
1 949 |
1 999 |
Derivatives |
2 |
(69) |
Total Net financial debt
at FL Entertainment level |
1 950 |
1 930 |
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
Secure Notes + earn-out – Cash / (Adjusted EBITDA + shareholder
fees + proforma impact from acquisitions)
1 +13.2% at constant currency2 Adjusted EBITDA, Adjusted net
income and Adjusted free cash flow: refer to the Appendix for
definition3 Leverage calculated on Net debt pre-IFRS 16 / Adjusted
EBITDA4 Content production & distribution5 Of which Influence
Vision in Austria (influence media adnetwork)6 Including Beyond
acquisition7 Including the discontinued Bet-at-home activities
- FL Entertainment_PR_2022 Results
FL Entertainment NV (EU:FLE)
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