Net Sales Grow to Ps.12,570 Million in 2012, EBITDA is Ps.4,483 Million
Solid Progress in Construction of Fiber Optics Network, Which Will Cover Close to 80% of the Territory of Colombia
MEXICO CITY, Feb. 21, 2013 (GLOBE NEWSWIRE) -- TV Azteca, S.A.B. de C.V. (BMV:AZTECA) (Latibex:XTZA), one of the two largest producers of Spanish-language television programming in the world, announced today financial results for the fourth quarter and full year 2012.
Fourth quarter results
Net sales for the quarter were Ps.3,627 million, compared to Ps.3,874 million for the same quarter of 2011. Total costs and expenses were Ps.2,019 million, 3% below Ps.2,092 million in the same period of the previous year. As a result, Azteca reported EBITDA of Ps.1,608 million, from Ps.1,782 million for the same period of last year. The EBITDA margin was 44%.
The company registered net income of Ps.1,111 million, compared to Ps.1,263 million for the same quarter of 2011.
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4Q 2011 | 4Q 2012 | Change | |||||
| Ps. | % | |||||||
| Net sales | $3,874 | $3,627 | $(247) | -6% | ||||
| EBITDA | $1,782 | $1,608 | $(174) | -10% | ||||
| Net income | $1,263 | $1,111 | $(152) | -12% | ||||
| Net income per CPO | $0.42 | $0.37 | $(0.05) | -12% | ||||
| Figures in millions of pesos. | ||||||||
| EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization. | ||||||||
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The number of CPOs outstanding as of December 31, 2011 was 2,985 million and as of December 31, 2012 was 2,984 million. |
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Net sales
Domestic ad sales were Ps.3,402 million in the period, compared to Ps.3,525 million from the same period of the previous year. Sales were complemented by revenue from Azteca America—the company's wholly-owned broadcast television network focused on the U.S. Hispanic market—of Ps.190 million, compared to Ps.271 million a year ago.
Programming sales to other countries were Ps.35 million in the period, from Ps.78 million from the previous year. The revenue resulted from the export of programs such as Los Rey and Amor Cautivo to Central America, as well as La Tenienteto South America, and Asia.
Costs and expenses
Costs and expenses decreased 3% during the period, as the result of a 5% reduction in production, programming and transmission costs —to Ps.1,611 million, from Ps.1,696 million in the same period a year ago— and a 3% increase in selling and administrative expenses —to Ps.408 million, from Ps.396 million in the same quarter of 2011.
The reduction in costs results from higher efficiency in the production of successful content, derived from solid strategies that control disbursements effectively; while the performance of sales and administrative expenses is mainly related to the growth in advisory fees and service payments.
EBITDA and net income
EBITDA was Ps.1,608 million, compared to Ps.1,782 million in the same period of last year. The most significant change below EBITDA was a Ps.180 million decrease in comprehensive financial cost, mainly related to lower interest related expenses this period.
Net income for the quarter was Ps.1,111 million, from Ps.1,263 million last year.
Debt
As of December 31, 2012, Azteca's outstanding debt —excluding Ps.1,558 million debt due in 2069—was Ps.9,039 million, 9% bellow the Ps.9,993 million from the previous year.
The cash balance of the company was Ps.7,271 million, compared to Ps.8,318 million a year ago. As a result, net debt was Ps.1,768 million, from Ps.1,675 million from the prior year. Debt to last twelve months (LTM) EBITDA ratio was 2 times, and net debt to LTM EBITDA was 0.4 times.
Fiber optic network
Azteca successfully concluded the installation of fiber optics in 226 municipalities in Colombia during the quarter, from a total of 753 municipalities in which it will deploy a network of 19,000 kilometers in a two and a half year period.
As previously announced, Azteca is building the largest network in Latin America, which will cover close to 80% of Colombian territory, and will commercialize telecommunications services in the country. For its installation, the government of Colombia will provide close to US$235 million. The commercialization of the services will result in the diversification and strengthening of Azteca's results, by adding its operation to the solid performance of its broadcast television business.
Twelve months results
Net sales in the year were Ps.12,570 million, 3% above the Ps.12,199 million in 2011. Total costs and expenses were Ps.8,087 million, from Ps.7,522 million for last year. The increase in costs results from the exhibition rights and production costs related to the London 2012 Olympic Games, as well as the production of competitive content.
Azteca reported EBITDA of Ps.4,483 million, compared to Ps.4,677 million from the prior year; the EBITDA margin for 2012 was 36%. The company recorded net income of Ps.2,307 million, 5% above the Ps.2,199 million from 2011, mainly due to an exchange gain in the year, compared to exchange loss in 2011.
| 2011 | 2012 | Change | ||
| Ps. | % | |||
| Net sales | $12,199 | $12,570 | $371 | 3% |
| EBITDA | $4,677 | $4,483 | $(194) | -4% |
| Net income | $2,199 | $2,307 | $109 | 5% |
| Net income per CPO | $0.74 | $0.77 | $0.03 | 5% |
| Figures in millions of pesos. | ||||
| EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization. | ||||
| The number of CPOs outstanding as of December 31, 2011 was 2,985 million and as of December 31, 2012 was 2,984 million. | ||||
Company Profile
Azteca is one of the two largest producers of Spanish-language television programming in the world, operating two national television networks in Mexico, Azteca 13 and Azteca 7, through more than 300 owned and operated stations across the country. Azteca affiliates include Azteca America Network, a broadcast television network focused on the rapidly growing U.S. Hispanic market, and Azteca Web, an Internet company for North American Spanish speakers.
Azteca is a Grupo Salinas company (www.gruposalinas.com), a group of dynamic, fast-growing, and technologically advanced companies focused on creating shareholder value, contributing to build the middle class of the countries in which they operate, and improving society through excellence. Created by Mexican entrepreneur Ricardo B. Salinas (www.ricardosalinas.com), Grupo Salinas operates a as a management development and decision forum for the top leaders of member companies. The companies include: Azteca (www.irtvazteca.com), Azteca America (www.aztecaamerica.com), Grupo Elektra (www.grupoelektra.com.mx), Banco Azteca (www.bancoazteca.com.mx), Advance America (www.advanceamerica.net), Afore Azteca (www.aforeazteca.com.mx), Seguros Azteca (www.segurosazteca.com.mx) and Grupo Iusacell (www.iusacell.com). Each of the Grupo Salinas companies operates independently, with its own management, board of directors and shareholders. Grupo Salinas has no equity holdings. However, member companies share a common vision, values and strategies for achieving rapid growth, superior results and world-class performance.
Except for historical information, the matters discussed in this press release are forward-looking statements and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Other risks that may affect Azteca and its subsidiaries are identified in documents sent to securities authorities.
| TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES | ||||||
| CONSOLIDATED RESULTS OF OPERATIONS | ||||||
| (Millions of Mexican pesos of December 31 of 2011 and 2012) | ||||||
| Fourth Quarter of: | ||||||
| 2011 | 2012 | |||||
| Change | ||||||
| Net revenue | Ps 3,874 | 100% | Ps 3,627 | 100% | Ps (247) | -6% |
| Programming, production and transmission costs | 1,696 | 44% | 1,611 | 44% | (85) | -5% |
| Selling and administrative expenses | 396 | 10% | 408 | 11% | 12 | 3% |
| Total costs and expenses | 2,092 | 54% | 2,019 | 56% | (73) | -3% |
| EBITDA | 1,782 | 46% | 1,608 | 44% | (174) | -10% |
| Depreciation and amortization | 141 | 144 | 3 | |||
| Other expense -Net | 42 | 123 | 81 | |||
| Operating profit | 1,599 | 41% | 1,341 | 37% | (258) | -16% |
| Equity in income from affiliates | 56 | 29 | (27) | |||
| Comprehensive financing result: | ||||||
| Interest expense | (292) | (189) | 102 | |||
| Other financing expense | (19) | (10) | 10 | |||
| Interest income | 39 | 51 | 12 | |||
| Exchange loss -Net | (107) | (52) | 55 | |||
| (379) | (199) | 180 | ||||
| Income before the following provision | 1,277 | 33% | 1,171 | 32% | (105) | -8% |
| Provision for income tax | (31) | (58) | (27) | |||
| Net income | Ps 1,245 | Ps 1,113 | Ps (132) | |||
| Non-controlling share in net profit | Ps (17) | Ps 2 | Ps 20 | |||
| Controlling share in net profit | Ps 1,263 | 33% | Ps 1,111 | 31% | Ps (152) | -12% |
| TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES | ||||||
| CONSOLIDATED RESULTS OF OPERATIONS | ||||||
| (Millions of Mexican pesos of December 31 of 2011 and 2012) | ||||||
| Period ended December 31, | ||||||
| 2011 | 2012 | |||||
| Change | ||||||
| Net revenue | Ps 12,199 | 100% | Ps 12,570 | 100% | Ps 371 | 3% |
| Programming, production and transmission costs | 6,056 | 50% | 6,577 | 52% | 521 | 9% |
| Selling and administrative expenses | 1,467 | 12% | 1,510 | 12% | 44 | 3% |
| Total costs and expenses | 7,522 | 62% | 8,087 | 64% | 565 | 8% |
| EBITDA | 4,677 | 38% | 4,483 | 36% | (194) | -4% |
| Depreciation and amortization | 509 | 556 | 47 | |||
| Other expense -Net | 289 | 331 | 42 | |||
| Operating profit | 3,879 | 32% | 3,595 | 29% | (283) | -7% |
| Equity in income from affiliates | 57 | 36 | (21) | |||
| Comprehensive financing result: | ||||||
| Interest expense | (931) | (922) | 9 | |||
| Other financing expense | (97) | (148) | (52) | |||
| Interest income | 149 | 223 | 73 | |||
| Exchange Gain -Net | (328) | 132 | 460 | |||
| (1,206) | (715) | 491 | ||||
| Income before the following provision | 2,730 | 22% | 2,916 | 23% | 186 | 7% |
| Provision for income tax | (548) | (619) | (71) | |||
| Net income | Ps 2,182 | Ps 2,297 | Ps 116 | |||
| Non-controlling share in net profit | Ps (17) | Ps (10) | Ps 7 | |||
| Controlling share in net profit | Ps 2,199 | 18% | Ps 2,307 | 18% | Ps 109 | 5% |
| TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES | ||||
| CONSOLIDATED BALANCE SHEETS | ||||
| (Millions of Mexican pesos of December 31 of 2011 and 2012) | ||||
| At December 31 | ||||
| 2011 | 2012 | |||
| Change | ||||
| Current assets: | ||||
| Cash and cash equivalents | Ps 8,318 | Ps 7,271 | Ps (1,047) | |
| Accounts receivable | 7,751 | 5,894 | (1,857) | |
| Other current assets | 1,875 | 2,110 | 235 | |
| Total current assets | 17,944 | 15,275 | (2,669) | -15% |
| Exhibition rights | 1,328 | 1,505 | 177 | |
| Property, plant and equipment-Net | 3,339 | 3,465 | 126 | |
| Television concessions-Net | 7,721 | 7,565 | (156) | |
| Other assets | 1,021 | 1,481 | 460 | |
| Goodwill -Net | -- | -- | -- | |
| Deferred income tax asset | 4,286 | 4,286 | -- | |
| Total long term assets | 17,695 | 18,302 | 607 | 3% |
| Total assets | Ps 35,639 | Ps 33,577 | Ps (2,062) | -6% |
| Current liabilities: | ||||
| Short-term debt | Ps 667 | Ps 667 | Ps -- | |
| Other current liabilities | 2,561 | 2,493 | (68) | |
| Total current liabilities | 3,228 | 3,160 | (68) | -2% |
| Long-term debt: | ||||
| Structured Securities Certificates | 5,210 | 4,547 | (663) | |
| Long-term debt | 4,116 | 3,825 | (291) | |
| Total long-term debt | 9,326 | 8,372 | (954) | |
| Other long term liabilities: | ||||
| Advertising advances | 7,532 | 5,419 | (2,113) | |
| American Tower Corporation (due 2069) | 1,674 | 1,558 | (116) | |
| Deferred income tax asset | 3,106 | 3,112 | 6 | |
| Total other long-term liabilities | 12,312 | 10,089 | (2,223) | -18% |
| Total liabilities | 24,866 | 21,621 | (3,245) | -13% |
| Total stockholders' equity | 10,773 | 11,956 | 1,183 | 11% |
| Total liabilities and equity | Ps 35,639 | Ps 33,577 | Ps (2,062) | -6% |