MEXICO CITY, April 21, 2015 (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 2015.
First quarter results
Net sales for the quarter were Ps.2,545 million, in comparison to Ps.2,541 million for the same quarter of last year. Total costs and expenses were Ps.2,164 million, compared to Ps.2,013 million from the same period last year.
As a result, Azteca reported EBITDA of Ps.382 million, compared to Ps.528 million from last year; EBITDA margin for the quarter was 15%. The company registered a net loss of Ps.676 million, compared to a net loss of Ps.178 million for the same quarter of 2014.
| 1Q 2014 | 1Q 2015 | Change | ||
| Ps. | % | |||
| Net sales | $2,541 | $2,545 | $4 | 0% |
| EBITDA | $528 | $382 | $(146) | -28% |
| Net result | $(178) | $(676) | $(498) | ---- |
| Net result per CPO | $(0.06) | $(0.23) | $(0.17) | ---- |
Figures in millions of pesos.
EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization.
The number of CPOs outstanding as of March 31, 2014 was 2,987 million and as of March 31, 2015 was 2,985 million.
Net sales
National advertising sales were Ps.2,117 million, in comparison to Ps.2,227 million a year ago.
In addition, the company registered sales from Azteca America—the company's wholly-owned broadcast television network focused on the U.S. Hispanic market—of Ps.284 million this quarter, a 6% increase compared to Ps.269 million a year ago.
Content sales to other countries were Ps.58 million in the period, from Ps.26 million in the previous year; revenue for the quarter resulted from the commercialization of the shows Así en el barrio como en el cielo in Asia and Latinamerica, and Vivir a destiempo y Siempre tuya Acapulco in Africa, as well as the sale of Azteca pay TV channels in the rest of the world.
Revenue from Azteca Guatemala and Azteca Honduras was Ps.14 million, in contrast with Ps.10 million for the previous year.
Sales from Azteca Comunicaciones Colombia —derived from telecommunications services through the fiber-optic network that the company operates in that country— were Ps.72 million, in comparison to Ps.9 million for the previous year.
Costs and expenses
Costs and expenses grew 7% during the period, as a result of a 10% increase in production, programming, transmission and telecommunications services costs —to Ps.1,781 million from Ps.1,622 million in the same period a year ago— and a 2% reduction in selling and administrative expenses —to Ps.382 million, compared to Ps.391 million in the same quarter of 2014.
The growth in costs mainly derives from Colombian operations, such costs include rent paid for the transmission towers and space to operate telecommunications nodes, as well as the maintenance and operation of the network. The commercialization of telecommunications services in that country has associated costs, but it is expected to generate solid yields in the future.
The selling and administrative expenses decreased due to strategies that generate better operating efficiency, which translated in a reduction in travel expenses, services and operation this period.
EBITDA and net result
EBITDA was Ps.382 million compared to Ps.528 million for the same period of the prior year.
The most significant change below EBITDA was a Ps.294 million increase in the comprehensive financing cost, mainly derived from a larger foreign exchange loss this quarter.
The company registered a net loss of Ps.676 million for the quarter, compared to a net loss of Ps.178 million for the same period a year ago
Debt
As of March 31, 2015, Azteca's outstanding debt —excluding Ps.1,401 million of debt due in 2069—was Ps.13,156 million. The cash and cash equivalents balance of the company was Ps.5,422 million; as a result, net debt was Ps.7,734 million at the end of the quarter.
Fiber-optic network in Peru
During the quarter, Azteca Comunicaciones Peru —a subsidiary of Azteca— built a network of 506 kilometers of fiber optics, from a total of 13,400 kilometers that will be deployed in the Red Dorsal Nacional de Fibra Óptica of the country.
For the construction of the network, also during the quarter, the company successfully issued bonds in global markets for US$274 million, with a term of 15 years with a 5.88% yield. The issuance is rated BBB by Fitch Ratings and Baa1 by Moody´s.
The notes will not be included on the balance sheet of Azteca as both principal and interest will be paid through the mechanism of co-financing offered by the Peruvian government to the concessionaire of the construction, as consideration for the delivery of the network infrastructure.
As previously announced, in December 2013 Azteca won an auction to construct and operate a fiber-optic network which will offer telecommunications services in approximately 80% of Peruvian territory. Construction of the network started last December, and has an estimated time of 18 months. Azteca will commercialize the telecommunications services in 339 communities, through a 20-year concession.
Azteca offers world-class telecommunications, effectively driving the wellbeing of the population and productivity in business. The company also successfully built and operates the largest fiber optic network in Latin America, in Colombia.
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, el trece and Azteca 7, through more than 300 owned and operated stations across the country. Azteca affiliates include Azteca US, 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 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), Totalplay (www.totalplay.com.mx) and Enlace TPE (www.enlacetpe.com.mx). 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 2014 and 2015 ) | |||||||||
| First Quarter of : | |||||||||
| 2014 | 2015 | ||||||||
| Change | |||||||||
| Net revenue | Ps | 2,541 | 100% | Ps | 2,545 | 100% | Ps | 5 | 0% |
| Programming, production and transmission costs | 1,622 | 64% | 1,781 | 70% | 160 | 10% | |||
| Selling and administrative expenses | 391 | 15% | 382 | 15% | (9) | -2% | |||
| Total costs and expenses | 2,013 | 79% | 2,164 | 85% | 151 | 7% | |||
| EBITDA | 528 | 21% | 382 | 15% | (146) | -28% | |||
| Depreciation and amortization | 171 | 178 | 8 | ||||||
| Other expense -Net | 61 | 93 | 32 | ||||||
| Operating profit | 296 | 12% | 110 | 4% | (186) | -63% | |||
| Equity in income from affiliates | 12 | 5 | (7) | ||||||
| Comprehensive financing result: | |||||||||
| Interest expense | (254) | (297) | (44) | ||||||
| Other financing expense | (21) | (13) | 8 | ||||||
| Interest income | 36 | 33 | (3) | ||||||
| Exchange loss -Net | (5) | (260) | (256) | ||||||
| (244) | (538) | (294) | |||||||
| Income before the following provision | 64 | 3% | (423) | -17% | (487) | -758% | |||
| Provision for income tax | (246) | (258) | (12) | ||||||
| Net income | Ps | (182) | Ps | (681) | Ps | (499) | |||
| Non-controlling share in net profit | Ps | (4) | Ps | (5) | Ps | (1) | |||
| Controlling share in net profit | Ps | (178) | -7% | Ps | (676) | -27% | Ps | (498) | 280% |
| TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES | |||||||
| CONSOLIDATED BALANCE SHEETS | |||||||
| (Millions of Mexican pesos of March 31 of 2014 and 2015) | |||||||
| At March 31 | |||||||
| 2014 | 2015 | ||||||
| Change | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | Ps | 6,013 | Ps | 5,422 | Ps | (591) | |
| Accounts receivable | 6,986 | 8,202 | 1,216 | ||||
| Other current assets | 3,413 | 3,432 | 19 | ||||
| Total current assets | 16,412 | 17,056 | 644 | 4% | |||
| Accounts receivable | 198 | 300 | 102 | ||||
| Exhibition rights | 2,209 | 2,551 | 342 | ||||
| Property, plant and equipment-Net | 3,599 | 3,879 | 280 | ||||
| Television concessions-Net | 7,760 | 9,432 | 1,672 | ||||
| Other assets | 3,968 | 3,659 | (309) | ||||
| Deferred income tax asset | 3,128 | 2,680 | (448) | ||||
| Total long term assets | 20,862 | 22,501 | 1,639 | 8% | |||
| Total assets | Ps | 37,274 | Ps | 39,557 | Ps | 2,283 | 6% |
| Current liabilities: | |||||||
| Short-term debt | Ps | -- | Ps | 1,145 | Ps | 1,145 | |
| Other current liabilities | 3,194 | 3,649 | 455 | ||||
| Advertising advances | -- | -- | -- | ||||
| Total current liabilities | 3,194 | 4,794 | 1,600 | 50% | |||
| Long-term debt: | |||||||
| Long-term debt | 10,199 | 12,011 | 1,812 | ||||
| Total long-term debt | 10,199 | 12,011 | 1,812 | ||||
| Other long term liabilities: | |||||||
| Advertising advances | 8,451 | 8,358 | (93) | ||||
| American Tower Corporation (due 2069) | 1,198 | 1,401 | 203 | ||||
| Deferred income tax asset | 2,163 | 1,542 | (621) | ||||
| Total other long-term liabilities | 11,812 | 11,301 | (511) | -4% | |||
| Total liabilities | 25,205 | 28,106 | 2,901 | 12% | |||
| Total stockholders' equity | 12,069 | 11,451 | (618) | -5% | |||
| Total liabilities and equity | Ps | 37,274 | Ps | 39,557 | Ps | 2,283 | 6% |