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Syn Investor Presentation 2021
2210_rns_2021-05-12_0911e890-da02-44c8-b6f5-6e317ccf46f1.pdf
Investor Presentation
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Q1 results 2021
14th of May 2021
vodafone
visir
SPORT
BYLGJAN NED
X
ENDOR
Key financial results
Q1 2021
Revenue
4,962 m IKR
Q1 2020
4,995 m IKR
EBITDA
1,388 m IKR
Q1 2020
1,355 m IKR
Earnings
-231 m IKR
Q1 2020
-350 m IKR
FCF
-119 m IKR
Q1 2020
522 m IKR
Income Statement
| Q1 2021 | Q1 2020 | Ch. | % ch. | |
|---|---|---|---|---|
| Revenues | 4,962 | 4,995 | -33 | -0.7% |
| Cost of sales | -3,337 | -3,350 | 13 | -0.4% |
| Gross profit | 1,625 | 1,645 | -20 | -1.2% |
| Operating expense | -1,583 | -1,666 | 83 | -5.0% |
| EBITDA | 1,388 | 1,355 | 33 | 2.4% |
| EBIT | 42 | -21 | 63 | -302% |
| Net financial expense | -93 | -441 | 348 | -79% |
| Effect of associates | -193 | 20 | -213 | -1064% |
| Income tax | 13 | 92 | -79 | -86% |
| Loss | -231 | -350 | 119 | - |
| Gross Margin | 32.7% | 32.9% | ||
| EBITDA | 28.0% | 27.1% | ||
| EBIT | 0.9% | -0.4% |
Key factors impacting Q1 2021
- Revenue decrease by -0.7% between quarters. From March 2020 the pandemic started to have a negative impact on the Groups operation.
- EBITDA increase between Q1 2020 and Q1 2021 due to lower operating expenses which is mainly the result of cost optimization procedures.
- Interest expenses decrease by 75m between periods.
- Exchange rate gain recognized in Q1 2021 was 46m compared to exchange rate loss of 230m in Q1 2020.
- A loss of 189m was recognised due to the sale of the Faroese associate.
*Amounts are in ISK millions
Revenue breakdown
| Q1 2021 | Q1 2020 | Ch. | % Ch. | |
|---|---|---|---|---|
| Media | 1,918 | 1,935 | -17 | -1% |
| Broadband | 1,145 | 1,160 | -15 | -1% |
| Mobile | 939 | 911 | 28 | 3% |
| Fixed Line | 140 | 167 | -27 | -16% |
| Hosting and operating solutions | 313 | 371 | -58 | -16% |
| Retail sale | 293 | 235 | 58 | 25% |
| Other revenue | 214 | 216 | -2 | -1% |
| Total Revenue | 4,962 | 4,995 | -33 | -1% |
Media
- The decision to make Stöð 2 a full subscription TV has had a positive impact on subscription revenue. Revenues from subscription were similar in January 2021 and December 2020, which is more often the biggest month of the year. The number of subscribers for Stöð 2 increased by 12% between Q1 2021 and Q1 2020.
Broadband
- There is a sign of turnaround in revenue from broadband. Revenue increased by 3% between Q4 2020 and Q1 2021. The increase is comparable between corporate and retail market, but revenue from the retail market weighs significantly higher.
Mobile
- Revenue from mobile increases by 3% between Q1 2020 and Q1 2021 which is mainly due to growth in IOT revenue. At the same time roaming revenue have decreased by 72% between periods.
Fixed line
- The decline in revenue for fixed lines has stalled. Revenue was similar for Q1 2021 and Q4 2020.
Hosting and operating solutions
- Revenue decreased by 16%, mostly because of decrease in retail sales and unfavorable exchange rate development. The functional currency for Endor is EUR.
Retail sales
- Continuing positive development in retail sales. A result of changes in consumer behavior during the pandemic and increased focus in marketing. Margin from retail is low but has been growing due to change in the product mix.
*Amounts are in ISK millions
Statement of Financial Position
Assets
| ISK m | 31.3.2021 | 31.12.2020 | % ch. |
|---|---|---|---|
| Fixed assets | |||
| Right-of-use asset | 4,899 | 5,227 | -6% |
| Property, plant and equipment | 3,680 | 3,818 | -4% |
| Goodwill | 8,890 | 8,932 | 0% |
| Other intangible assets | 4,333 | 4,403 | -2% |
| Shares in other companies | 120 | 1,398 | -91% |
| Deferred tax asset | 382 | 383 | 0% |
| Fixed assets total | 22,304 | 24,161 | -8% |
| Current assets | |||
| Broadcasting license rights | 1,828 | 1,876 | -3% |
| Inventories | 288 | 241 | 20% |
| Trade receivables and other short term receivables | 4,340 | 3,217 | 35% |
| Cash and cash equivalents | 240 | 831 | -71% |
| Current assets total | 6,696 | 6,165 | 9% |
| Assets available for sale | 536 | 536 | |
| Total assets | 29,536 | 30,862 | -4% |
Liabilities and equity
| ISK m | 31.3.2021 | 31.12.2020 | % ch. |
|---|---|---|---|
| Equity | 8,208 | 8,549 | -4% |
| Long term liabilities | |||
| Interest bearing debt | 9,472 | 9,492 | 0% |
| Lease liabilities | 4,395 | 4,507 | -2% |
| Other liabilities | 166 | 166 | 0% |
| Deferred tax liabilities | - | 16 | -100% |
| Non-current liabilities | 14,033 | 14,181 | -1% |
| Current liabilities | |||
| Interest bearing debt | 992 | 992 | 0% |
| Lease liabilities | 1,067 | 1,259 | -15% |
| Accounts payable and other current liabilities | 5,067 | 5,699 | -11% |
| Current liabilities | 7,126 | 7,950 | -10% |
| Liabilities because of assets available for sale | 169 | 182 | -7% |
| Total equity and liabilities | 29,536 | 30,862 | -4% |
| Interest bearing debt | 15,925 | 16,251 | |
| Net interest bearing debt | 15,686 | 15,419 | |
| Equity ratio | 27.8% | 27.8% |
*Amounts are in ISK millions
Cashflow
| ISK m | Q1 2021 | Q1 2020 | Ch. | % ch. |
|---|---|---|---|---|
| Cash generated by operations | 542 | 1.053 | -511 | -49% |
| Investing activities | -807 | -738 | -69 | 9% |
| Financing activities | -320 | -590 | 270 | -46% |
| Change in cash | -585 | -275 | -310 | 113% |
| Cash at beginning of period | 831 | 634 | 197 | 31% |
| Effect of translation of sub. | -6 | 26 | -32 | - |
| Cash at the end of period | 240 | 385 | -145 | -38% |
| Q1 2021 | Q1 2020 | Ch. | % ch. | |
| --- | --- | --- | --- | --- |
| Cash generated by operations before interest and tax | 688 | 1.260 | -572 | -45% |
| Investment activities* | -807 | -738 | -69 | 9% |
| Free cash flow | -119 | 522 | -641 | -123% |
*Excluding net investment in share in other companies
Cashflow Q1 2021
*Amounts are in ISK millions
Statement of Financial Position - Key ratios
Equity Ratio
Current Ratio*
Net interest bearing debt
*Current assets/ accounts payable and other current liabilities
*Amounts are in ISK millions
Balance sheet transformation
vodafone
visir
SPORT
BYLGJAN 989
SPORT
ENDOR
Sale of passive mobile infrastructure
- On the 31st of March, Sýn hf. signed an agreement for the sale and leaseback of its passive mobile infrastructure.
- The total sales price is around 7.1 billion ISK.
- The transaction will strengthen the Company's balance sheet and the expected sales profit is over 6.5 billion ISK.
- At the same time, a long-term lease agreement was made, which will ensure the Group's continued access to the passive mobile infrastructure.
- The impact of the transaction on the EBITDA of the Company is immaterial since the amount of the right of use assets recognized in relation to the transaction will be a much lower than the recognized lease liability. Interest expense of the lease liability will be recognized through finance expense.
- The agreement is subject to be accepted by The Competition Authority.
- Sýn hf. is preparing for additional sales of other infrastructure in the year.
| Asset | Owner |
|---|---|
| 1 Active radio transmission equipment | Vodafone |
| 2 Antennae & cables (fibre / feeders) | Vodafone |
| 3 Physical tower, masts & pole | TowerCo |
| 4 Foundation & fencing | TowerCo |
| 5 Contractual right to occupy site area | TowerCo |
| 6 Power equipment | TowerCo |
| 7 Cooling system | TowerCo |
| Asset | Owner |
| --- | --- |
| 8 Surveillance systems | TowerCo |
| 9 Access facilities | TowerCo |
| 10 Outdoor cabinet | Vodafone |
| 11 Shelter / service rooms | TowerCo |
| 12 Emergency equipment | TowerCo |
| 13 Cable routing (duct) | TowerCo |
| 14 Mounting equipment | TowerCo |
Landline systems* throughout the country
- Vodafone operates fiber-optic system throughout the country
- Fiber optics are the basis of Vodafone's fixed line and mobile network
- Vodafone has equipment on over 800 sites in Iceland today.
- Optimization potentials through joint ventures.
*The system is not part of the infrastructure sold in March 2021.
Television and radio distribution*
- Vodafone owns the only nationwide television and radio distribution system.
- HD digital television broadcasts reach to 99.9% of the population.
- Vodafone has a nationwide IPTV system, only two such systems exist in the country.
*The system is not part of the infrastructure sold in March 2021.
Exciting times ahead
vodafone
visir
SPORT
BYLGJAN 989
SPORT
X
ENDOR
"Fjölskyldupakkinn"
- In March, a new bundling offer "Fjölskyldupakkinn" was launched. The bundle includes both Stöð 2 and Stöð 2+ and telecommunication services.
- The acquisition of the media operation gives the Company the possibility to offer a complete service for a better price to our customers. "Fjölskyldupakkinn" combines the best of both telecommunications and media services provided by Sýn.
Focus on domestic content
- Stöð 2 received 16 nominations for this year's Edda, the Icelandic television and film awards.
- The result of a significantly increased focus on producing high quality television shows in Icelandic.
- In the year 2020 the Company produced 266 episodes of domestic TV shows which is an increase of 41% from the year 2019.
News
- From January 2021 Stöð 2 is available exclusively for subscribers.
- Subscriptions to Stöð 2 increased by 5% in April 2021 compared to April 2020.
- Stöð 2 received four out of five nominations to The Edda awards in the news and interview show of the year category.
- Ummerki
- Kompás
- Fósturbörn
- Transbörn
- In development is a fresh news commentary show where light is shed on various issues, especially issues regarding the younger generation.
Development within advertising
vísir
SPORT
vísir
BYLGJAN
X
Development within advertisement
- Structural changes which have led to:
- Better customer service
-
Increased variability in product offering
-
New products
- Content and location driven marketing.
-
New web site, auglysingar.is
-
Positive feedback from the market in relation to these changes and the effect on Visir.is which has been ranked the most visited website in Iceland for the last months.
GEO TARGETING ADS
BYLGJAN 989
X visir
Are you in business in Akureyri or with residents in the east part of the country?
- With geo targeting advertisement will pop up exactly on the location specified.
- A specific region, municipality or target can be chosen or a specific postcode.
- By using this method, customers can direct their message exactly where they want to.
CONTENT MARKETING
BYLGJAN
X visir
Advertisement connected to the news content on Vísir.is
Customers can place their advertisement ribbons so they will pop up only on news that have certain keywords or „tags“ in its contents. These keywords can be found under any news at Vísir.
- Frjálsar íþrstir Fylkir Gametíví Geimðinn Golf Grindavík Grín og gaman Grótta Hafnarfjörður Harmageddon Haukar Heilbrigðismál Heilsa Hestar Hinsegin HKHM 2012 í Katar Hollywood Hús og heimili Húsnæðismál Hælisleitendur Hönnunar Mars Icelandair ÍA ÍBV ÍF Hafjarðarbær Íslandsvink Íslendingar erlendis Íslenski handboltinn Íslenski körfuboltinn Íslenskir bankar Jafnréttismál Järðhræningar á Reykjanesi Jól KA Kaffispjallið Keflavík ÍF Keflavíkurflugvöllur Kjaramál Kynferðisofbeldi Kosningar 2021 Kóngafólk Kópavogur KR KSI Kör-fuboltakvöld Landbúnaður Landhelgisgæslan Landspitalinn Leikhús Leikjavísir Loftslagsmál Lyf Lloireglan Lögreglumál Mað-nauðsmál Mannréttindi Markaðir Matur Menning Miðflokkurinn Mjólkurbikarinn MMA Myndlist MBA Netflix Neytendur M-L Noregur Norski boltinn Nóbelsverðlaun Nýsköpun Ofbeldi gegin börnum Orkumál Pepsi Max-deild karla Pepsi Max-deild ovenna Pepsi Max-mörkin Píratar Rafíþróttir Reykjanesbær Reykjavík RIFF Ríkisstjórn Katrínar Jakobsdóttur Sameinuðu bjóðinnar Sam-félagsmiðlar Samfylkingin Samgöngur Samgöngusiys Samkomubann á Íslandi Seðlabankinn Seinni bylgan Sjølftvæðisflok-kurinn Sjóvarútvegur Skallagrímur Skattar og tollar Skipulag Skóla- og menntamál Snæfelt Sósíalistaflokkurinn Stangveiði Star-fsframi Stjarnan Stjórnsýsla Stjörnun Styttur og útilistaverk Sund Sundlaugar Sveitarstjórnmal Svípjóð Sænski boltinn Tindastóll Tímamót Tíska og hönnun Tónlist Tækni UMF Grindavík UMF Njarðvík UMF Selfoss Umferðaróryggi Umhverrismál Uppskriftir Utanríkismál Valur Veður Veitingastaðir Verslun Vestmannaeyjar Viðreisn Vinnumarkaður Vinnustaðameyning Vinnustaðurinn Vinstri græn Vistaskipti (fólk í nýja vinnu) Víkingur Reykjavík Vísindi Vodafone-deildin Þór Akureyn Þór Þorlákshöfn Þróttur Rey- kjavík Þýski handboltinn Öll stóru Evrópulöndin
VOD ADVERTISEMENT IN POPULAR CONTENT
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BYLGJAN
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X
visir
Post the advertisement in popular categories on television and capture the eyes of the target group.
Advertisements can be tagged to the following categories:
- Love, romance and drama
- Entertainment and comedy
- Action and crime
- Documentaries and films
- Icelandic content
- Sports
- Travel and Outdoors
- Housing and construction
- Cooking shows
UEFA EURO2020
- The European Football Championship which was supposed to take place in the summer of 2020 will be played from June 11th to the July 11th.
- Stöð 2 Sport has broadcasting rights for the EUROS. The EUROS are the biggest single project in the history of Stöð 2 Sport.
- Every game in the tournament, 51 total, will be live on Stöð 2 Sport.
- Pre-game show and post-game show for every game.
- A recap show at the end of every game day.
- Guðmundur Benediktsson and Helena Ólafsdóttir will lead the EURO coverage.
- Programming will be aired live from a brand new Stöð 2 Sport studio.
pepsi
MAX DEILDIN
- Stöð 2 Sport agreed on the key term for the broadcasting rights of the Pepsi Max-leagues, the Icelandic men and women's top football leagues for the seasons 2022-2026.
- Stöð 2 Sport has held exclusive broadcasting rights to the men's top league in Icelandic football since 1997.
- The current agreement regarding the Icelandic men and women's top football leagues expires after this season.
- Extensive programs will be produced regarding Icelandic football with more than 100 live broadcasts from games during the season and approximately 60-70 shows.
PEPSI MAX CONTENT PLATFORM
- Pepsi Max league world is a content platform for subscribers through the web television at stod2.is
- Every game in men's and women's Pepsi Max league will be accessible for subscribers
- Access to previous games and shows from Stöð 2 Sport.
- Ongoing development of the content platform.
FRAMUNDAN I BEINNI
Thank you
vodafone
visir
SPORT
BYLGJAN 989
KIRIK
X
ENDOR
Disclaimer
The information in this presentation are based on sources that Sýn hf. deem reliable at the time of publication. However, it is not possible to secure fully that they are completely faultless.
All information in the presentation are the property of Sýn hf. It is prohibited to copy, amend or distribute in any manner, partly or fully, the presentation and the information therein.
The presentation is only for information purposes and not to be used as basis for decision making on part of recipients. Recipients shall not in any manner interpret the content therein as promise or guidance. Sýn hf. is not obliged to provide the recipients with further information nor to amend or correct should the information it is based on change.
Any statement in this presentation that cites future prospects is solely for guidance purposes, based on current evolution, information and projections. Future guidance of the company are subject to numerous risk and uncertainties that can result in being substantially different from the content of this presentation. External factors, such as access to finance, legislation, regulatory actions and otherwise can thus have substantial effects.
Sýn hf. will not update future guidance of the company due to situations that will occur afterwards. Sýn hf. suggest that recipients of the presentation should not trust statements therein at a later stage as they are only relevant at the day of the publication. Subject to this provision, all guidance on future prospects are fully reliable.
The recipients of the presentation acknowledge that they are subject to aforementioned disclaimers and limitations.