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Azteca Announces 7% Growth in EBITDA, to Ps.1,713 Million in 4Q13

(February 27, 2014)


—Net sales grow 5% to Ps.3,816 million—



—Solid Progress in the construction of the largest fiber optic network in Latin America—



MEXICO CITY, Feb. 27, 2014 (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 2013.


Fourth quarter results




"We generated superior revenue during the quarter, as a result of growing demand for advertising slots in our solid full day programming grid," commented Mario San Roman, CEO of Azteca. "The higher sales were compatible with additional operating efficiency, which expanded EBITDA and profitability margins in the period."



Net sales were Ps.3,816 million, 5% above the Ps.3,627 million for the same quarter of last year. Total costs and expenses were Ps.2,103 million, 4% above the Ps.2,019 million in the same period of the previous year.



As a result, Azteca reported EBITDA of Ps.1,713 million, 7% more than the Ps.1,608 million for the same period of last year. The EBITDA margin was 45%, one percentage point higher than the previous year. Net income was Ps.771 million, compared to Ps.1,111 million from the same quarter in 2012.
































































































 

 

 

4Q 2012

4Q 2013

Change

 

 

 

Ps.

%

 

 

 

 

 

Net sales

$3,627

$3,816

$189

5%

 

 

 

 

 

EBITDA

$1,608

$1,713

$105

7%

 

 

 

 

 

Net income

$1,111

$771

$(340)

-31%

 

 

 

 

 

Net income per CPO

$0.37

$0.26

$(0.11)

-31%

 

Figures in millions of pesos.

EBITDA: Operating Profit Before Depreciation and Amortization.

The number of CPOs outstanding as of December 31, 2012, as well as of December 2013 was 2,984 million.

 


Net sales



Domestic ad sales were Ps.3,525 million in the quarter, 4% above the Ps.3,402 million from the fourth quarter of 2012. The increase in sales was complemented by revenue from Azteca America —the company's wholly-owned broadcast television network focused on the U.S. Hispanic market— of Ps.222 million, 17% above the Ps.190 million a year ago, in the context of superior preference of advertisers to reach their targeted market segments through the company's programing.



Content sales to other countries were Ps.69 million in the quarter, from Ps.35 million from the previous year. The revenue was mainly related to the export of the programs Corazón en condominio and Hombre tenías que ser, to Central and South America.



Costs and expenses



The 4% increase in costs and expenses was the result of a 5% growth in production, programming and transmission costs —to Ps.1,686 million, from Ps.1,611 million in the same period a year ago— and a 2% increase in selling and administrative expenses —to Ps.417 million, from Ps.408 million in the same quarter of 2012.



The smaller increase in total costs and expenses compared to revenue is the result of strict budgeting in content production, as well as solid strategies that generate additional operating efficiencies, effectively controlling the company's expenditures.



EBITDA and net income



EBITDA was Ps.1,713 million, 7% above the Ps.1,608 million in the same period of the prior year.



The most significant change below EBITDA was a Ps.227 million increase in other financial expenses, as a result of the commissions related to the prepayment of debt during the quarter.



Net income for the quarter was Ps.771 million, compared to Ps.1,111 million from a year ago.



Debt



As of December 31, 2013, Azteca's outstanding debt —excluding Ps.1,199 million debt due in 2069—was Ps.10,195 million. The cash balance of the company was Ps.4,527 million. As a result, net debt was Ps.5,668 million at the end of the quarter.



Debt to last twelve months (LTM) EBITDA ratio was 2.5 times, and net debt to LTM EBITDA was 1.4 times.



Fiber optics network in Colombia



During the quarter Azteca made solid progress in the construction of a fiber optic network that will cover close to 80% of Colombian territory.  At the end of December, there were 14,700 kilometers already built in 602 municipalities, of a total of 753 municipalities to be covered at the end of the project, which will be deployed through 19,000 kilometers.



As previously announced, Azteca is building in Colombia the largest fiber optic network in Latin America, and will sell telecommunications services in the country. The commercialization of telecommunications services will diversify and strengthen Azteca revenue sources, adding to existing solid results in the media business.



Twelve months results



Net sales in 2013 were Ps.12,068 million, compared to Ps.12,570 million from the previous year. The redefinition of communication projects from the incoming federal government, as well as a hard comparison related to the additional income related to the Olympic Games in 2012 are the main causes for the reduction in net sales.



Total costs and expenses were Ps.7,924 million, 2% below the Ps.8,087 million in 2012, resulting from strict control of disbursements related to the production of content.



Azteca reported EBITDA of Ps.4,144 million, compared to Ps.4,483 million from the prior year; the EBITDA margin for the year was 34%. The company recorded net income of Ps.1,168 million, compared to Ps.2,307 million from the previous year, in the context of a deterioration in the comprehensive financial cost. 
































































































 

 

 

2012

2013

Change

 

 

 

Ps.

%

 

 

 

 

 

Net sales

$12,570

$12,068

$(502)

-4%

 

 

 

 

 

EBITDA

$4,483

$4,144

$(339)

-8%

 

 

 

 

 

Net income

$2,307

$1,168

$(1,139)

-49%

 

 

 

 

 

Net income per CPO

$0.77

$0.39

$(0.38)

-49%

 

Figures in millions of pesos.

EBITDA: Operating Profit Before Depreciation and Amortization.

The number of CPOs outstanding as of December 31, 2012, as well as of December 2013 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 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 2012 and 2013 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Fourth Quarter of:

 

 

 

2012

 

2013

 

 

 

 

 

 

Change

 

 

 

 

 

 

 

Net revenue

 Ps 3,627

100%

 Ps 3,816

100%

 Ps 189

5%

 

 

 

 

 

 

 

Programming, production and transmission costs

 1,611

44%

 1,686

44%

 75

5%

Selling and administrative expenses

 408

11%

 417

11%

 9

2%

Total costs and expenses

 2,019

56%

 2,103

55%

 84

4%

 

 

 

 

 

 

 

EBITDA

 1,608

44%

 1,713

45%

 105

7%

 

 

 

 

 

 

 

Depreciation and amortization

 144

 

 154

 

 10

 

Other expense -Net

 123

 

 275

 

 152

 

 

 

 

 

 

 

 

Operating profit

 1,341

37%

 1,284

34%

 (57)

-4%

 

 

 

 

 

 

 

Equity in income from affiliates

 29

 

 12

 

 (17)

 

 

 

 

 

 

 

 

Comprehensive financing result:

 

 

 

 

 

 

Interest expense

 (239)

 

 (330)

 

 (91)

 

Other financing expense

 40

 

 (186)

 

 (227)

 

Interest income

 51

 

 54

 

 3

 

Exchange loss -Net

 (52)

 

 (9)

 

 42

 

 

 (199)

 

 (471)

 

 (272)

 

 

 

 

 

 

 

 

Income before the following provision

 1,171

32%

 824

22%

 (347)

-30%

 

 

 

 

 

 

 

Provision for income tax

 (58)

 

 (51)

 

 7

 

 

 

 

 

 

 

 

Net income

 Ps 1,113

 

 Ps 773

 

 Ps (340)

 

 

 

 

 

 

 

 

Non-controlling share in net profit

 Ps 2

 

 Ps 2

 

 Ps (1)

 

 

 

 

 

 

 

 

Controlling share in net profit

 Ps 1,111

31%

 Ps 771

20%

 Ps (340)

-31%































































































































































































































































































































































 

 

 

TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES

CONSOLIDATED RESULTS OF OPERATIONS

(Millions of Mexican pesos of December 31 of 2012 and 2013 )

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Period ended December 31,

 

 

 

2012

 

2013

 

 

 

 

 

 

 

Change

 

 

 

 

 

 

 

Net revenue

 Ps 12,570

100%

 Ps 12,068

100%

 Ps (502)

-4%

 

 

 

 

 

 

 

Programming, production and transmission costs

 6,577

52%

 6,368

53%

 (209)

-3%

Selling and administrative expenses

 1,510

12%

 1,556

13%

 46

3%

Total costs and expenses

 8,087

64%

 7,924

66%

 (164)

-2%

 

 

 

 

 

 

 

EBITDA

 4,483

36%

 4,144

34%

 (339)

-8%

 

 

 

 

 

 

 

Depreciation and amortization

 556

 

 600

 

 43

 

Other expense -Net

 331

 

 620

 

 289

 

 

 

 

 

 

 

 

Operating profit

 3,595

29%

 2,925

24%

 (671)

-19%

 

 

 

 

 

 

 

Equity in income from affiliates

 36

 

 5

 

 (32)

 

 

 

 

 

 

 

 

Comprehensive financing result:

 

 

 

 

 

 

Interest expense

 (972)

 

 (1,032)

 

 (60)

 

Other financing expense

 (98)

 

 (251)

 

 (152)

 

Interest income

 223

 

 173

 

 (49)

 

Exchange Gain -Net

 132

 

 (39)

 

 (171)

 

 

 (715)

 

 (1,148)

 

 (432)

 

 

 

 

 

 

 

 

Income before the following provision

 2,916

23%

 1,781

15%

 (1,135)

-39%

 

 

 

 

 

 

 

Provision for income tax

 (619)

 

 (623)

 

 (4)

 

 

 

 

 

 

 

 

Net income

 Ps 2,297

 

 Ps 1,159

 

 Ps (1,139)

 

 

 

 

 

 

 

 

Non-controlling share in net profit

 Ps (10)

 

 Ps (10)

 

 Ps 0

 

 

 

 

 

 

 

 

Controlling share in net profit

 Ps 2,307

18%

 Ps 1,168

10%

 Ps (1,139)

-49%















































































































































































































































































































































 

 

 

TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Millions of Mexican pesos of December 31 of 2012 and 2013)

 

 

 

 

 

 

 

 

 

 

At December 31

 

 

 

2012 

2013 

 

 

 

 

 

Change

Current assets:

 

 

 

 

Cash and cash equivalents

 Ps 6,446

 Ps 4,527

 Ps (1,919)

 

Accounts receivable

 5,414

 6,446

 1,032

 

Other current assets

 2,915

 3,254

 339

 

 

 

 

 

 

Total current assets

 14,775

 14,227

 (548)

-4%

 

 

 

 

 

Accounts receivable

 480

 374

 (106)

 

Exhibition rights

 1,505

 2,108

 603

 

Property, plant and equipment-Net

 3,465

 3,523

 58

 

Television concessions-Net

 7,721

 7,760

 39

 

Other assets

 1,544

 3,012

 1,468

 

Deferred income tax asset

 4,535

 4,672

 137

 

Total long term assets

 19,250

 21,449

 2,199

11%

 

 

 

 

 

Total assets

 Ps 34,025

 Ps 35,676

 Ps 1,651

5%

 

 

 

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

Short-term debt

 Ps 667

 Ps -- 

 Ps (667)

 

Other current liabilities

 2,369

 3,280

 911

 

Advertising advances

 -- 

 -- 

 -- 

 

Total current liabilities

 3,036

 3,280

 244

8%

 

 

 

 

 

Long-term debt:

 

 

 

 

Structured Securities Certificates

 4,611

 -- 

 (4,611)

 

Long-term debt

 3,825

 10,195

 6,370

 

Total long-term debt

 8,436

 10,195

 1,759

 

Other long term liabilities:

 

 

 

 

Advertising advances

 5,422

 5,406

 (16)

 

American Tower Corporation (due 2069)

 1,558

 1,199

 (359)

 

Deferred income tax asset

 3,463

 3,463

 -- 

 

 

 

 

 

 

Total other long-term liabilities

 10,443

 10,068

 (375)

-4%

 

 

 

 

 

Total liabilities

 21,915

 23,543

 1,628

7%

 

 

 

 

 

Total stockholders' equity

 12,110

 12,133

 23

0%

 

 

 

 

 

Total liabilities and equity

 Ps 34,025

 Ps 35,676

 Ps 1,651

5%

CONTACT: Investor Relations

Bruno Rangel
Grupo Salinas
Tel. +52 (55) 1720-9167
jrangelk@gruposalinas.com.mx

Rolando Villarreal
Grupo Elektra S.A.B. de C.V.
Tel. +52 (55) 1720-9167
rvillarreal@gruposalinas.com.mx

Press Relations

Luciano Pascoe
Grupo Salinas
Tel. +52 (55) 1720 1313 ext. 36553
lpascoe@gruposalinas.com.mx

Daniel McCosh
Grupo Salinas
Tel. +52 (55) 1720-0059
dmccosh@gruposalinas.com.mx

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