MEXICO CITY, April 23, 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 first quarter of 2013.
First quarter results
Net sales for the quarter were Ps.2,417 million, from Ps.2,751 million for the same quarter of 2012. The decrease in sales was caused mainly by the change in administrations of the Mexican government, which tends to redefine marketing projects; the company expects advertising investment levels to recover during 2013.
Total costs and expenses were Ps.1,803 million, 5% below Ps.1,901 million in the same period of the previous year. As a result, Azteca reported EBITDA of Ps.614 million, compared to Ps.850 million from last year. The EBITDA margin was 25%.
The company registered net income of Ps.152 million, from Ps.438 million for the same quarter of 2012.
| 1Q 2012 | 1Q 2013 | Change | ||
| Ps. | % | |||
| Net sales | $ 2,751 | $ 2,417 | $ (334) | -12% |
| EBITDA | $ 850 | $ 614 | $ (237) | -28% |
| Net income | $ 438 | $ 152 | $ (286) | -65% |
| Net income per CPO | $ 0.15 | $ 0.05 | $ (0.10) | -65% |
| Figures in millions of pesos. | ||||
| EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization. | ||||
| The number of CPOs outstanding as of March 31, 2012 was 2,983 million and as of March 31, 2013 was 2,984 million. | ||||
Net sales
Domestic ad sales were Ps.2,135 million in the period, compared to Ps.2,463 million for 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.250 million, compared to Ps.251 million a year ago.
Programming sales to other countries were Ps.32 million in the period, from Ps.37 million from the previous year. The revenue resulted from the export of programs such as La Otra Cara del Alma, in Central and South America, and Los Rey in Europe.
Costs and expenses
Costs and expenses decreased 5% during the period, as the result of a 9% reduction in production, programming and transmission costs—to Ps.1,423 million, from Ps.1,555 million in the same period a year ago— and a 10% increase in selling and administrative expenses—to Ps.380 million, compared to Ps.345 million in the same quarter of 2012.
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 operations and personnel expenses in the period.
EBITDA and net income
EBITDA was Ps.614 million, compared to Ps.850 million in the same period of last year. The most significant change below EBITDA was a Ps.23 million deterioration in equity in income from affiliates, resulting from losses from which we recognize results under the participation method, compared to profit from last year.
Net income for the quarter was Ps.152 million, from Ps.438 million last year.
Debt
As of March 31, 2013, Azteca's outstanding debt—excluding Ps.1,480 million debt due in 2069—was Ps.8,658 million, 9% below the Ps.9,466 million from the previous year.
The cash balance of the company was Ps.7,264 million, compared to Ps.8,239 million a year ago. As a result, net debt was Ps.1,394 million, from Ps.1,227 million from the prior year. Debt to last twelve months (LTM) EBITDA ratio was 2 times, and net debt to LTM EBITDA was 0.3 times.
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 March 31 of 2012 and 2013) | ||||||
| First Quarter of : | ||||||
| 2012 | 2013 | |||||
| Change | ||||||
| Net revenue | Ps 2,751 | 100% | Ps 2,417 | 100% | Ps (334) | -12% |
| Programming, production and transmission costs | 1,555 | 57% | 1,423 | 59% | (132) | -9% |
| Selling and administrative expenses | 345 | 13% | 380 | 16% | 35 | 10% |
| Total costs and expenses | 1,901 | 69% | 1,803 | 75% | (98) | -5% |
| EBITDA | 850 | 31% | 614 | 25% | (237) | -28% |
| Depreciation and amortization | 129 | 149 | 19 | |||
| Other expense -Net | 58 | 59 | 1 | |||
| Operating profit | 663 | 24% | 406 | 17% | (257) | -39% |
| Equity in income from affiliates | 13 | (10) | (23) | |||
| Comprehensive financing result: | ||||||
| Interest expense | (244) | (240) | 3 | |||
| Other financing expense | (13) | (12) | 1 | |||
| Interest income | 54 | 41 | (13) | |||
| Exchange loss -Net | 201 | 207 | 6 | |||
| (1) | (4) | (2) | ||||
| Income before the following provision | 675 | 25% | 392 | 16% | (283) | -42% |
| Provision for income tax | (241) | (244) | (4) | |||
| Net income | Ps 434 | Ps 148 | Ps (286) | |||
| Non-controlling share in net profit | Ps (3) | Ps (4) | Ps (0) | |||
| Controlling share in net profit | Ps 438 | 16% | Ps 152 | 6% | Ps (286) | -65% |
| TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES | ||||
| CONSOLIDATED BALANCE SHEETS | ||||
| (Millions of Mexican pesos of March 31 of 2012 and 2013) | ||||
| At March 31 | ||||
| 2012 | 2013 | |||
| Change | ||||
| Current assets: | ||||
| Cash and cash equivalents | Ps 8,239 | Ps 7,264 | Ps (975) | |
| Accounts receivable | 8,548 | 7,114 | (1,434) | |
| Other current assets | 2,280 | 2,409 | 129 | |
| Total current assets | 19,067 | 16,787 | (2,280) | -12% |
| Exhibition rights | 1,274 | 1,589 | 315 | |
| Property, plant and equipment-Net | 3,343 | 3,451 | 108 | |
| Television concessions-Net | 7,721 | 7,721 | -- | |
| Other assets | 1,054 | 1,585 | 531 | |
| Deferred income tax asset | 4,286 | 4,286 | -- | |
| Total long term assets | 17,678 | 18,632 | 954 | 5% |
| Total assets | Ps 36,745 | Ps 35,419 | Ps (1,326) | -4% |
| Current liabilities: | ||||
| Short-term debt | Ps 667 | Ps 667 | Ps -- | |
| Other current liabilities | 2,180 | 2,435 | 255 | |
| Total current liabilities | 2,847 | 3,102 | 255 | 9% |
| Long-term debt: | ||||
| Structured Securities Certificates | 5,020 | 4,358 | (662) | |
| Long-term debt | 3,779 | 3,633 | (146) | |
| Total long-term debt | 8,799 | 7,991 | (808) | |
| Other long term liabilities: | ||||
| Advertising advances | 9,350 | 7,851 | (1,499) | |
| American Tower Corporation (due 2069) | 1,539 | 1,480 | (59) | |
| Deferred income tax asset | 3,106 | 3,112 | 6 | |
| Total other long-term liabilities | 13,995 | 12,443 | (1,552) | -11% |
| Total liabilities | 25,641 | 23,536 | (2,105) | -8% |
| Total stockholders' equity | 11,104 | 11,883 | 779 | 7% |
| Total liabilities and equity | Ps 36,745 | Ps 35,419 | Ps (1,326) | -4% |