FULL YEAR
- Net revenues of US$ 864.8 million up 17% -
- OIBDA of US$ 167.0 million up 56% -
- Free cash flow of US$ (3.5) million up 96% -
FOURTH QUARTER
- Net revenues of US$ 276.9 million up 8% -
- OIBDA of US$ 81.2 million up 25% -
HAMILTON, Bermuda, Feb. 22, 2012 (GLOBE NEWSWIRE) -- Central European Media Enterprises Ltd. ("CME" or the "Company") (Nasdaq:CETV) (Prague Stock Exchange:CETV) today announced financial results for the full year and three months ended December 31, 2011.
Net revenues for the year ended December 31, 2011 increased by US$ 127.6 million to US$ 864.8 million compared to 2010 and OIBDA1 increased by US$ 59.7 million to US$ 167.0 million. Operating income for the year was US$ 6.8 million. Net loss from continuing operations for the year was US$ (179.6) million. Free cash flow2 for the year improved to US$ (3.5) million from US$ (95.5) million for 2010.
Net revenues for the fourth quarter of 2011 increased by US$ 19.5 million to US$ 276.9 million compared to the fourth quarter of 2010. OIBDA for the quarter improved by US$ 16.4 million to US$ 81.2 million. Operating loss for the quarter was US$ (12.1) million. Net loss from continuing operations for the quarter was US$ (77.2) million.
Adrian Sarbu, President and Chief Executive Officer of CME, commented: "In a difficult year we kept our promises: our revenues grew by 17%, our OIBDA increased by 56% and our cash flow improved by 96%. We outperformed the markets following successful implementation of our new business model: One Content, Multiple Distribution. We maintained our leadership in each country and reduced like-for-like costs. We have positioned the company on a strong path for growth with revenues driven not only by advertising but also by content and digital distribution. In 2012, we will focus on deleveraging, strengthening our leadership and fuelling new revenue engines."
1 OIBDA, which includes program rights amortization costs, is determined as operating income / (loss) before depreciation, amortization of intangible assets and impairments of assets as defined in "Segment Data" below.
2 Free cash flow is defined as cash flows from continuing operating activities less expenditure on property, plant and equipment, net of disposals of property, plant and equipment.
Consolidated Results for the Year Ended December 31, 2011
Net revenues for the year ended December 31, 2011 increased by 17.3% to US$ 864.8 million from US$ 737.1 million for the year ended December 31, 2010. Operating income, which included impairment losses of US$ 68.7 million, was US$ 6.8 million for the year ended December 31, 2011 compared to US$ 22.9 million for the year ended December 31, 2010. Net loss from continuing operations for the year ended December 31, 2011 was US$ (179.6) million compared to a net loss of US$ (116.9) million for the year ended December 31, 2010. Fully diluted loss from continuing operations per share for the year ended December 31, 2011 was US$ (2.71) compared to US$ (1.77) for the year ended December 31, 2010.
OIBDA for the year ended December 31, 2011 increased by 55.6% to US$ 167.0 million from US$ 107.3 million in the year ended December 31, 2010. OIBDA margin3 for the year ended December 31, 2011 increased to 19.3% from 14.6% in the year ended December 31, 2010.
Headline consolidated results for the year ended December 31, 2011 and 2010 were:
| RESULTS | ||||
|
For the Year Ended December 31, (US $000's) |
||||
| 2011 | 2010 | $ change | % change | |
| Net revenues | $ 864,782 | $ 737,134 | $ 127,648 | 17.3 % |
| OIBDA | 167,002 | 107,323 | 59,679 | 55.6 % |
| Operating income | 6,792 | 22,877 | (16,085) | (70.3) % |
| Net loss from continuing operations | (179,604) | (116,924) | (62,680) | (53.6) % |
| Fully diluted loss from continuing operations per share | $ (2.71) | $ (1.77) | $ (0.94) | (53.1) % |
Consolidated Results for the Three Months Ended December 31, 2011
Net revenues for the three months ended December 31, 2011 increased by 7.6% to US$ 276.9 million from US$ 257.4 million for the three months ended December 31, 2010. Operating loss for the quarter, which included impairment losses of US$ 68.7 million, was US$ (12.1) million compared to operating income of US$ 41.9 million for the three months ended December 31, 2010. Net loss for the quarter was US$ (77.2) million compared to a net loss of US$ (25.4) million for the three months ended December 31, 2010. Fully diluted loss per share for the three months ended December 31, 2011 was US$ (1.12) compared to a loss of US$ (0.41) in the same period of 2010.
OIBDA for the three months ended December 31, 2011 increased to US$ 81.2 million from US$ 64.8 million in the three months ended December 31, 2010. OIBDA margin for the three months ended December 31, 2011 increased to 29.3% from 25.2% in the three months ended December 31, 2010.
Headline consolidated results for the three months ended December 31, 2011 and 2010 were:
| RESULTS | ||||
|
For the Three Months Ended December 31, (US $000's) |
||||
| 2011 | 2010 | $ change | % change | |
| Net revenues | $ 276,882 | $ 257,413 | $ 19,469 | 7.6 % |
| OIBDA | 81,165 | 64,776 | 16,389 | 25.3 % |
| Operating (loss) / income | (12,106) | 41,903 | (54,009) | n.m.4 |
| Net loss | (77,225) | (25,442) | (51,783) | (203.5) % |
| Fully diluted loss per share | $ (1.12) | $ (0.41) | $ (0.71) | (173.2) % |
3 OIBDA margin is defined as the ratio of OIBDA to Net revenues.
4 Number is not meaningful.
Segment Results
We evaluate the performance of our operations based on Net revenues and OIBDA.
Our Net revenues and Consolidated OIBDA for the year ended December 31, 2011 and 2010 were:
| SEGMENT RESULTS | ||||
|
For the Year Ended December 31, (US $000's) |
||||
| 2011 | 2010 | $ change | % change | |
| Broadcast | $ 774,978 | $ 690,727 | $ 84,251 | 12.2 % |
| Media Pro Entertainment | 187,224 | 140,797 | 46,427 | 33.0 % |
| New Media | 15,764 | 11,193 | 4,571 | 40.8 % |
| Intersegment revenues | (113,184) | (105,583) | (7,601) | (7.2) % |
| Net revenues | $ 864,782 | $ 737,134 | $ 127,648 | 17.3 % |
| Broadcast | $ 211,090 | $ 164,415 | $ 46,675 | 28.4 % |
| Media Pro Entertainment | 3,996 | (3,005) | 7,001 | n.m.4 |
| New Media | (2,558) | (6,542) | 3,984 | 60.9 % |
| Central | (41,851) | (44,062) | 2,211 | 5.0 % |
| Elimination | (3,675) | (3,483) | (192) | (5.5) % |
| Consolidated OIBDA | $ 167,002 | $ 107,323 | $ 59,679 | 55.6 % |
Our Net revenues and Consolidated OIBDA for the three months ended December 31, 2011 and 2010 were:
| SEGMENT RESULTS | ||||
|
For the Three Months Ended December 31, (US $000's) |
||||
| 2011 | 2010 | $ change | % change | |
| Broadcast | $ 245,062 | $ 241,172 | $ 3,890 | 1.6 % |
| Media Pro Entertainment | 60,649 | 47,929 | 12,720 | 26.5 % |
| New Media | 5,285 | 4,132 | 1,153 | 27.9 % |
| Intersegment revenues | (34,114) | (35,820) | 1,706 | 4.8 % |
| Net revenues | $ 276,882 | $ 257,413 | $ 19,469 | 7.6 |
| Broadcast | $ 88,688 | $ 77,502 | $ 11,186 | 14.4 % |
| Media Pro Entertainment | 2,293 | 1,058 | 1,235 | 116.7 % |
| New Media | 565 | (173) | 738 | n.m.4 |
| Central | (9,882) | (12,939) | 3,057 | 23.6 % |
| Elimination | (499) | (672) | 173 | 25.7 % |
| Consolidated OIBDA | $ 81,165 | $ 64,776 | $ 16,389 | 25.3 % |
CME will host a teleconference and video webcast to discuss its fourth quarter and full year results on Wednesday, February 22, 2012 at 9:00 a.m. New York time (2:00 p.m. London time and 3:00 p.m. Prague time). The video webcast and teleconference will refer to presentation slides which will be available on CME's website at www.cme.net prior to the call.
To access the teleconference, U.S. and international callers may dial +1 785-424-1051 ten minutes prior to the start time and reference passcode CETVQ411. The conference call will be video webcasted live via www.cme.net and can be viewed on a range of platforms including Windows, Android and Apple devices including iPhone and iPad.
The video webcast and a digital audio replay in MP3 format will be available for two weeks following the call at www.cme.net.
In the coming weeks, CME will post the results for the quarter and full year ended December 31, 2011 for its wholly-owned subsidiary CET 21 spol. s r.o. at www.cme.net.
Forward-Looking and Cautionary Statements
This press release contains forward-looking statements. For all forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy or are otherwise beyond our control and some of which might not even be anticipated. Forward-looking statements reflect our current views with respect to future events and because our business is subject to such risks and uncertainties, actual results, our strategic plan, our financial position, results of operations and cash flows could differ materially from those described in or contemplated by the forward-looking statements.
For a more detailed description of these uncertainties and other factors, please see the "Risk Factors" section in CME's Annual Report on Form 10-K for the year period ended December 31, 2011, which was filed with the Securities and Exchange Commission on February 22, 2012. We undertake no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise.
This press release should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2011, which was filed with the Securities and Exchange Commission on February 22, 2012.
We make available free of charge on our website at www.cme.net our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports as soon as reasonably practicable after we electronically file such material with, or furnish it to, the Securities and Exchange Commission.
CME is a media and entertainment company operating leading businesses in six Central and Eastern European markets with an aggregate population of approximately 50 million people. CME's broadcast operations are located in Bulgaria (bTV, bTV Cinema, bTV Comedy, bTV Action, bTV Lady and Ring.bg), Croatia (Nova TV, Doma and Nova World), the Czech Republic (TV Nova, Nova Cinema, Nova Sport and MTV Czech), Romania (PRO TV, PRO TV International, Acasa, PRO Cinema, Sport.ro, MTV Romania and PRO TV Chisinau Moldova), the Slovak Republic (TV Markíza and Doma) and Slovenia (POP TV, Kanal A and the POP NON STOP subscription package). CME's broadcast operations are supported by its production and distribution division, Media Pro Entertainment, as well as its New Media division, which operates Voyo, the pan-regional video-on-demand service.
CME is traded on the NASDAQ Global Select Market and the Prague Stock Exchange under the ticker symbol "CETV".
For additional information, please visit www.cme.net.
| CENTRAL EUROPEAN MEDIA ENTERPRISES LTD. | ||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||
| (US$ 000's, except share and per share data) | ||
|
For the Year Ended December 31, |
||
| 2011 | 2010 | |
| Net revenues | $ 864,782 | $ 737,134 |
| Operating expenses: | ||
| Operating costs | 136,018 | 123,339 |
| Cost of programming | 445,802 | 390,303 |
| Depreciation of property, plant and equipment | 52,954 | 54,415 |
| Amortization of broadcast licenses and other intangibles | 34,881 | 25,987 |
| Cost of revenues | 669,655 | 594,044 |
| Selling, general and administrative expenses | 119,587 | 119,816 |
| Impairment charge | 68,748 | 397 |
| Operating income | 6,792 | 22,877 |
| Interest expense, net | (158,704) | (131,267) |
| Foreign currency exchange loss, net | (31,124) | (5,030) |
| Change in fair value of derivatives | 7,281 | 1,164 |
| Other income | 1 | 357 |
| Loss from continuing operations before tax | (175,754) | (111,899) |
| Provision for income taxes | (3,850) | (5,025) |
| Loss from continuing operations | (179,604) | (116,924) |
| Discontinued operations, net of tax | — | (3,922) |
| Gain on disposal of discontinued operations | — | 217,619 |
| Income from discontinued operations | — | 213,697 |
| Net (loss) / income | (179,604) | 96,773 |
| Net loss attributable to noncontrolling interests | 4,993 | 3,402 |
| Net (loss) / income attributable to CME Ltd. | $ (174,611) | $ 100,175 |
| PER SHARE DATA: | ||
| Net (loss) / income per share | ||
| Continuing operations attributable to CME Ltd. - Basic and diluted | $ (2.71) | $ (1.77) |
| Discontinued operations attributable to CME Ltd. - Basic and diluted | — | 3.34 |
| Net (loss) / income attributable to CME Ltd - Basic and diluted | $ (2.71) | $ 1.57 |
| Weighted average common shares used in computing per share amounts (000's): | ||
| Basic | 64,385 | 64,029 |
| Diluted | 64,385 | 64,029 |
| CENTRAL EUROPEAN MEDIA ENTERPRISES LTD. | ||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (continued) | ||
| (US$ 000's, except share and per share data) | ||
|
For the Three Months Ended December 31, |
||
| 2011 | 2010 | |
| Net revenues | $ 276,882 | $ 257,413 |
| Operating expenses: | ||
| Operating costs | 33,282 | 39,513 |
| Cost of programming | 132,058 | 121,693 |
| Depreciation of property, plant and equipment | 11,969 | 13,885 |
| Amortization of broadcast licenses and other intangibles | 11,488 | 7,297 |
| Cost of revenues | 188,797 | 182,388 |
| Selling, general and administrative expenses | 31,443 | 32,725 |
| Impairment charge | 68,748 | 397 |
| Operating (loss) / income | (12,106) | 41,903 |
| Interest expense, net | (32,150) | (38,701) |
| Foreign currency exchange loss, net | (32,576) | (28,872) |
| Change in fair value of derivatives | 2,681 | 3,425 |
| Other income | 770 | 557 |
| Loss before tax | (73,381) | (21,688) |
| Provision for income taxes | (3,844) | (3,754) |
| Net loss | (77,225) | (25,442) |
| Net loss / (income) attributable to noncontrolling interests | 4,834 | (674) |
| Net loss attributable to CME Ltd. | $ (72,391) | $ (26,116) |
| PER SHARE DATA: | ||
| Net loss per share | ||
| Net loss attributable to CME Ltd - Basic and diluted | $ (1.12) | $ (0.41) |
| Weighted average common shares used in computing per share amounts (000's): | ||
| Basic | 64,393 | 64,358 |
| Diluted | 64,393 | 64,358 |
| CENTRAL EUROPEAN MEDIA ENTERPRISES LTD. | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| (US$ 000's) | ||
|
December 31, 2011 |
December 31, 2010 |
|
| ASSETS | ||
| Cash and cash equivalents | $ 186,386 | $ 244,050 |
| Other current assets | 351,903 | 368,035 |
| Total current assets | 538,289 | 612,085 |
| Property, plant and equipment, net | 217,367 | 250,902 |
| Goodwill and other intangible assets, net | 1,633,388 | 1,816,943 |
| Other non-current assets | 292,725 | 260,620 |
| Total assets | $ 2,681,769 | $ 2,940,550 |
| LIABILITIES AND EQUITY | ||
| Accounts payable and accrued liabilities | $ 240,048 | $ 224,058 |
| Current portion of long-term debt and other financing arrangements | 1,058 | 13,562 |
| Other current liabilities | 14,469 | 5,456 |
| Total current liabilities | 255,575 | 243,076 |
| Long-term portion of long-term debt and other financing arrangements | 1,323,311 | 1,346,222 |
| Other non-current liabilities | 84,941 | 103,500 |
| Total liabilities | $ 1,663,827 | $ 1,692,798 |
| EQUITY | ||
| Common Stock | $ 5,151 | $ 5,149 |
| Additional paid-in capital | 1,404,648 | 1,377,803 |
| Accumulated deficit | (425,702) | (233,818) |
| Accumulated other comprehensive income | 17,595 | 77,745 |
| Total CME Ltd. shareholders' equity | 1,001,692 | 1,226,879 |
| Noncontrolling interests | 16,250 | 20,873 |
| Total equity | $ 1,017,942 | $ 1,247,752 |
| Total liabilities and equity | $ 2,681,769 | $ 2,940,550 |
| CENTRAL EUROPEAN MEDIA ENTERPRISES LTD. | ||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (US$ 000's) | ||
|
For the Year Ended December 31, |
||
| 2011 | 2010 | |
| Net cash generated from / (used in) continuing operating activities | $ 29,638 | $ (49,614) |
| Net cash used in continuing investing activities | (42,698) | (456,770) |
| Net cash (used in) / generated from financing activities | (38,168) | 7,338 |
| Net cash used in discontinued operations - operating activities | — | (5,921) |
| Net cash generated from discontinued operations - investing activities | — | 307,790 |
| Impact of exchange rate fluctuations on cash and cash equivalents | (6,436) | (4,727) |
| Net decrease in cash and cash equivalents | $ (57,664) | $ (201,904) |
| Net cash generated from / (used in) continuing operating activities | $ 29,638 | $ (49,614) |
| Capital expenditure, net of proceeds from disposals | (33,101) | (45,872) |
| Free cash flow | $ (3,463) | $ (95,486) |
| Supplemental disclosure of cash flow information: | ||
| Cash paid for interest | $ 111,802 | $ 100,901 |
| Cash paid for income taxes (net of refunds) | $ 6,315 | $ 14,714 |
Segment Data
We manage our business on a divisional basis, with three reportable segments: Broadcast, Media Pro Entertainment (our production and distribution division) and New Media.
We evaluate the performance of our segments based on Net revenues and OIBDA. OIBDA, which includes program rights amortization costs, is determined as operating income / (loss) before depreciation, amortization of intangible assets and impairments of assets. Items that are not allocated to our segments for purposes of evaluating their performance and therefore are not included in their OIBDA, include stock-based compensation and certain other items. We believe OIBDA is useful to investors because it provides a more meaningful representation of our performance, as it excludes certain items that do not impact either our cash flows or the operating results of our operations. OIBDA is also used as a component in determining management bonuses. Intersegment revenues and profits have been eliminated in consolidation. OIBDA may not be comparable to similar measures reported by other companies.
Below are tables showing our Net revenues and OIBDA by segment for the three and twelve months ended December 31, 2011 and 2010, together with a reconciliation of OIBDA to our Condensed Consolidated Statement of Operations:
| (US $000'S) |
For the Year Ended December 31, |
For the Three Months Ended December 31, |
||
| 2011 | 2010 | 2011 | 2010 | |
| Net revenues | ||||
| Broadcast: | ||||
| Bulgaria | $ 93,732 | $ 61,753 | $ 30,373 | $ 29,313 |
| Croatia | 61,502 | 51,350 | 19,053 | 16,659 |
| Czech Republic | 285,865 | 265,018 | 90,212 | 91,878 |
| Romania | 159,387 | 157,416 | 46,962 | 48,241 |
| Slovak Republic | 101,973 | 90,391 | 34,834 | 31,532 |
| Slovenia | 72,519 | 64,799 | 23,628 | 23,549 |
| Total Broadcast | $ 774,978 | $ 690,727 | $ 245,062 | $ 241,172 |
| Media Pro Entertainment | $ 187,224 | $ 140,797 | $ 60,649 | $ 47,929 |
| New Media | $ 15,764 | $ 11,193 | $ 5,285 | $ 4,132 |
| Intersegment revenues5 | (113,184) | (105,583) | (34,114) | (35,820) |
| Total net revenues | $ 864,782 | $ 737,134 | $ 276,882 | $ 257,413 |
5 Reflects revenues earned by the Media Pro Entertainment segment through sales to the Broadcast segment. All other revenues are third party revenues.
| (US $000's) |
For the Year Ended December 31, |
For the Three Months Ended December 31, |
||
| 2011 | 2010 | 2011 | 2010 | |
| OIBDA | ||||
| Broadcast: | ||||
| Bulgaria | $ 12,897 | $ (2,071) | $ 7,682 | $ 9,049 |
| Croatia | 4,659 | 2,368 | 3,798 | 948 |
| Czech Republic | 140,386 | 122,818 | 52,795 | 48,371 |
| Romania | 25,939 | 25,997 | 8,568 | 6,408 |
| Slovak Republic | 9,968 | (1,001) | 8,284 | 3,954 |
| Slovenia | 19,602 | 18,427 | 8,205 | 9,578 |
| Divisional operating costs | (2,361) | (2,123) | (644) | (806) |
| Total Broadcast | $ 211,090 | $ 164,415 | $ 88,688 | $ 77,502 |
| Media Pro Entertainment | $ 3,996 | $ (3,005) | $ 2,293 | $ 1,058 |
| New Media | $ (2,558) | $ (6,542) | $ 565 | $ (173) |
| Central | (41,851) | (44,062) | (9,882) | (12,939) |
| Elimination | (3,675) | (3,483) | (499) | (672) |
| Total OIBDA | $ 167,002 | $ 107,323 | $ 81,165 | $ 64,776 |
|
(US $000's) Reconciliation to Condensed Consolidated Statement of |
For the Year Ended December 31, |
For the Three Months Ended December 31, |
||
| Operations: | 2011 | 2010 | 2011 | 2010 |
| Total OIBDA | $ 167,002 | $ 107,323 | $ 81,165 | $ 64,776 |
| Depreciation of property, plant and equipment | (56,581) | (58,062) | (13,035) | (15,179) |
| Amortization of intangible assets | (34,881) | (25,987) | (11,488) | (7,297) |
| Impairment charge | (68,748) | (397) | (68,748) | (397) |
| Operating income / (loss) | $ 6,792 | $ 22,877 | $ (12,106) | $ 41,903 |
| Interest expense, net | (158,704) | (131,267) | (32,150) | (38,701) |
| Foreign currency exchange loss, net | (31,124) | (5,030) | (32,576) | (28,872) |
| Change in fair value of derivatives | 7,281 | 1,164 | 2,681 | 3,425 |
| Other income | 1 | 357 | 770 | 557 |
| Provision for income taxes | (3,850) | (5,025) | (3,844) | (3,754) |
| Loss from continuing operations | $ (179,604) | $ (116,924) | $ (77,225) | $ (25,442) |