FULL-YEAR 2018 RESULTS - 13 MARCH 2019 - Lagardère
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FULL-YEAR 2018 RESULTS 13 MARCH 2019
Full-year 2018 results / 13 March 2019
DISCLAIMER
Certain statements contained in this document are forward-looking statements (including objectives and trends), which address our
vision of the financial condition, results of operations, strategy, expected future business and financial performance of Lagardère SCA.
These data do not represent forecasts regarding Lagardère SCA’s results or any other performance indicator, but rather trends or
targets, as the case may be.
When used in this document, words such as “anticipate”, “believe”, “estimate”, “expect”, “may”, “intend”, “predict”, “hope”, “can”, “will”,
“should”, “is designed to”, “with the intent”, “potential”, “plan” and other words of similar import are intended to identify forward-looking
statements. Such statements include, without limitation, projections for improvements in process and operations, revenues and
operating margin growth, cash flow, performance, new products and services, current and future markets for products and services
and other trend projections as well as new business opportunities.
Although Lagardère SCA believes that the expectation reflected in such forward-looking statements are reasonable, such statements
are not guarantees of future performance. Actual results may differ materially from the forward-looking statements as a result of a
number of risks and uncertainties, many of which are outside our control, including without limitations:
• general economic conditions;
• legal, regulatory, financial and governmental risks related to the businesses;
• certain risks related to the media industry (including, without limitation, technological risks);
• the cyclical nature of some of the businesses.
Please refer to the most recent Reference Document (Document de référence) filed by Lagardère SCA with the French Autorité des
marchés financiers for additional information in relation to such factors, risks and uncertainties.
No representation or warranty, express or implied, is made as to, and no reliance should be placed upon, the fairness, accuracy,
completeness or correctness of such forward-looking statements and Lagardère SCA, as well as its affiliates, directors, advisors,
employees and representatives accept no responsibility in this respect.
Accordingly, we caution you against relying on forward-looking statements. The forward-looking statements abovementioned are made
as of the date of this document and neither Lagardère SCA nor any of its subsidiaries undertake any obligation to update or review such
forward-looking statements whether as a result of new information, future events or otherwise. Consequently neither Lagardère SCA
nor any of its subsidiaries are liable for any consequences that could result from the use of any of the above statements.
2
HIGHLIGHTS Full-year 2018 results 13 March 2019
Full-year 2018 results / 13 March 2019
HIGHLIGHTS
(€m) 2017* 2018
+2.5% consolidated
Revenue 7,084 7,258 +3.3% like-for-like**
Solid performance
from Travel Retail Group recurring EBIT** 399 401
and Sports &
Entertainment Group operating margin** 5.6% 5.5%
divisions
Profit – Group share 176 194
Due to the absence Adjusted profit – Group share** 214 222
of curriculum
reform, lower Free cash flow** 283 471
performance from
Publishing
Net debt at end of year** (1,368) (1,375)
Free cash flow
Earnings per share (in €) 1.36 1.49
substantially
improved
Ordinary dividend per share (in €) 1.30 1.30***
* Restated for IFRS 15 using the retrospective method.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51.
*** Ordinary dividend that will be recommended at the General Meeting on 10 may 2019.
4
Full-year 2018 results / 13 March 2019
GROUP RECURRING EBIT
+2.1%
+€403m +€396m +€405m +€401m
-€4m -€3m +€9m +€1m -€5m
2017 Group IFRS 15** Impact of 2017 Business 2018 HBF impact FX 2018 Group
recurring EBIT* disposals*** comparable performance comparable**** recurring EBIT*
* Alternative Performance Measure (APM) – See Glossary on slides 50/51.
** Impact of IFRS 15.
*** Disposals in 2018: Radio businesses in Eastern Europe, MonDocteur and Doctissimo.
**** Calculated using 2017 exchanges rates. 5
PERFORMANCE BY DIVISION Full-year 2018 results 13 March 2019
Full-year 2018 results / 13 March 2019
LAGARDÈRE PUBLISHING: ACTIVITY
2018 revenue by geographic area 2018 revenue by activity
Education
Other France Other 14%
18% 28% 17% 16%*
19%* 29%* 16%*
Illustrated
Spain Partworks Books
6% 12% 13%
6%* 12%* 13%*
US & UK & General
Canada Australia Literature
29% 19% 44%
27%* 19%* 43%*
€2,252m (down 1.6% on a consolidated basis and down 1.2% like-for-like).
€40m negative currency impact partially offset by a €30m positive scope effect.
Business down slightly, due to the absence of curriculum reform in France, Spain and the UK, partially
offset by a good performance in General Literature in the US and the UK.
* % of revenue in 2017. 7
Full-year 2018 results / 13 March 2019
LAGARDÈRE PUBLISHING: PROFITABILITY
Change in recurring EBIT (€m) and operating margin (%)
9.2%
8.4%
210 190
2017 2018
Profitability down slightly.
• Negative currency effect.
• Absence of education reforms weighed on profitability, as Education has a higher operating margin.
• Negative prior-year comparison basis in the Illustrated segment (Astérix et la Transitalique released
in 2017).
• Partially offset by good momentum in General Literature and contribution of recent acquisitions in the UK. 8
Full-year 2018 results / 13 March 2019
LAGARDÈRE TRAVEL RETAIL: ACTIVITY
2018 revenue by geographic area 2018 revenue by activity
US & Canada Asia-Pacific
21% 13%
22%* 12%*
Travel Duty Free &
EMEA France
Essentials Fashion
(excluding 24%
43% 40%
France) 25%*
44%* 39%*
42%
41%*
Foodservice
17%
17%*
€3,673m (up 7.7% on a consolidated basis and up 8.8% like-for-like).
€62m negative currency effect and €25m positive scope effect.
Strong growth in France, EMEA, America and ASPAC, lifted by good sales momentum, network expansion
and store openings, as well as robust passenger traffic.
* % of revenue in 2017. 9
Full-year 2018 results / 13 March 2019
LAGARDÈRE TRAVEL RETAIL: PROFITABILITY
Change in recurring EBIT (€m) and operating margin (%)
3.3%
3.3%
112 119
2017 2018
Travel Retail profitability stable.
• Travel Retail recurring EBIT up by €7 million buoyed mainly by organic growth and network expansion
in EMEA. North America benefits from strong sales momentum and commercial initiatives.
• Stable operating margin: the setup and development costs of new openings are offset by margin
improvements in existing concessions.
10Full-year 2018 results / 13 March 2019
LAGARDÈRE ACTIVE: ACTIVITY
2018 revenue by geographic area 2018 revenue by activity
Others
Other 5%
5%*
16%
16%*
Lagardère Non-Core
Studios Press
Spain France 24% 27%
7% 77% 21%* 27%*
6%* 78%*
TV Press
Channels 15%
12%
15%*
12%*
International
Radio French
Radio Non-core business
3%
14% Retained business
6%*
14%*
€895m (down 3.6% on a consolidated basis and down 2.3% like-for-like).
€13m negative scope effect.
Good performance from TV Channels and Audiovisual Production partially countering a drop in advertising
and circulation revenues at Magazine Publishing, as well as lower audience figures for the Europe 1 radio
station.
* % of revenue in 2017 restated for IFRS 15 using the retrospective method. 11Full-year 2018 results / 13 March 2019
LAGARDÈRE ACTIVE: PROFITABILITY
Change in recurring EBIT (€m) and operating margin (%)
8.4%
7.5%*
70 75
2017 2018
Profitability up by 0.9 percentage points.
• Margin improvement driven by good performance in advertising on TV Channels as well as cost saving
measures on Magazine Publishing and Radio operations in France.
• Partially offset by negative trends at Magazine Publishing, Europe 1 and some digital activities.
* % margin in 2017 restated for IFRS 15 using the retrospective method. 12Full-year 2018 results / 13 March 2019
LAGARDÈRE SPORTS AND ENTERTAINMENT: ACTIVITY
2018 revenue by geographic area 2018 revenue by activity
France Live Entertainment Media rights
Other
21% 18% 10% 16%
25%* 18%* 10%* 22%*
Asia & Germany Other Marketing
Australia 20% 27% rights
17% 20%* 24%* 47%
17%* 44%*
Rest of Europe UK
11% 13%
12%* 8%*
€438m (down 3.6% on a consolidated basis and down 4.1% like-for-like).
€8m negative currency effect and €10m positive scope effect.
2018 marked the lowest point of the four-year sporting events cycle, with the non-occurrence of the 2017
Total Africa Cup of Nations and the 2017 Asian qualifiers for the 2018 FIFA World Cup.
Partially offset by good performances from the Olympics division and from Football activities in Europe.
* % of revenue in 2017 restated for IFRS 15 using the retrospective method. 14Full-year 2018 results / 13 March 2019
LAGARDÈRE SPORTS AND ENTERTAINMENT: PROFITABILITY
Change in recurring EBIT (€m) and operating margin (%)
6.9%
4.7%*
30
22
2017 2018
Recurring EBIT up and improved operating margin.
• 2018 marked the lowest point of the four-year sporting events cycle.
• However, improved recurring EBIT and margin, mainly driven by the development of Sponsoring activities
and the good performance of the Olympic division.
* % margin in 2017 restated for IFRS 15 using the retrospective method. 15GROUP RESULTS
Full-year 2018 results
13 March 2019Full-year 2018 results / 13 March 2019
CHANGES IN REVENUE – 2018
+232
(€m)
+298
-20 -19 -58 7,258
7,084 -27
2017 Lagardère Lagardère Lagardère Lagardère FX and scope 2018
revenue* Publishing Travel Retail Active Sports and effect revenue
Entertainment
Revenue up 2.5% on a consolidated basis, up 3.3% like-for-like.
€52m positive scope effect and €110m negative currency effect.
Continued growth momentum powered by a solid performance at Lagardère Travel Retail, and achieved
despite lacklustre business cycles at Lagardère Publishing and Lagardère Sports and Entertainment.
* Restated for IFRS 15 using the retrospective method. 17Full-year 2018 results / 13 March 2019
GROUP RECURRING EBIT TO EBIT
(€m) 2017* 2018
399 401 409
275
205
43
3 4
(41) (57) (47)
(79) (72) (75)
Group Income from
recurring equity-accounted Restructuring Gains (losses) Impairment Amortisation**** EBIT
EBIT** companies*** costs on disposals losses
* Restated for IFRS 15 using the retrospective method.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51.
*** Before impairment losses.
**** Amortisation of acquisition-related intangible assets and expenses. 18Full-year 2018 results / 13 March 2019
EBIT TO PROFIT – GROUP SHARE
(€m) 2017* 2018
409
275
176 194
2
(28) (22)
(73) (59)
(134)
Profit attributable
Finance costs, Income tax to minority Profit – Group
EBIT
net expense interests share
* Restated for IFRS 15 using the retrospective method. 19Full-year 2018 results / 13 March 2019
GROUP RECURRING EBIT TO ADJUSTED PROFIT – GROUP SHARE
(€m) 2017* 2018
399 401
214 222
3 4
(59) (35) (31)
(73) (80) (93)
Income tax
Group Income from Adjusted profit Adjusted
Finance costs, expense excluding
recurring equity-accounted attributable profit – Group
net tax adjustments on
EBIT** companies*** to minority share**
non-recurring and
interests
non-operating items
* Restated for IFRS 15 using the retrospective method.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51.
*** Before impairment losses. 20Full-year 2018 results / 13 March 2019
CONSOLIDATED STATEMENT OF CASH FLOWS
(€m) 2017* 2018
Cash flow from operations before changes in working capital 536 505 Substantial improvement
Changes in working capital (71) 55 attributable to Lagardère
Publishing and Lagardère
Taxes paid excluding taxes on property disposals (61) (35) Travel Retail
Net cash from operating activities** 404 525
Including €130m at
Purchases/disposals of tangible and intangible assets*** (246) (237) Lagardère Travel Retail
Free cash flow excluding property disposals 158 288 with a significant portion
relating to new
Proceeds from property disposals net of tax paid and related refitting costs**** 125 183 stores/concessions
Free cash flow***** 283 471
In 2018, HBF acquisition
Purchases of investments (68) (340) covered by proceeds from
Disposals of investments 19 148 non-core assets disposals
Net cash from operating and investing activities 234 279
Dividend paid and other (143) (229)
Interest paid (70) (57)
Change in net debt 21 (7)
Net debt** (1,368) (1,375)
* Restated for IFRS 15 using the retrospective method.
** Before tax paid on property disposals.
*** Excluding property disposals and refitting costs.
**** See details on slide 30.
***** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 21Full-year 2018 results / 13 March 2019
CONSOLIDATED BALANCE SHEET
(€m) Assets* Liabilities
31 Dec. 2017** 31 Dec. 2018 31 Dec. 2017** 31 Dec. 2018
2,001 Total equity
2,820 1,924
Intangible assets 2,867
1,375 Net debt***
1,368
1,245
Other assets 1,271 1,035 Other liabilities
699 956
Assets held for sale 6 413 Liabilities held for sale
Working capital 2,933 2,737 2,829 2,677 Working capital
7,077 7,501 7,077 7,501
* Excluding assets included in net debt.
** Restated for IFRS 15 using the retrospective method.
*** Net of cash, cash equivalents, short-term investments and derivative instruments documented as hedges of debt. / Alternative Performance Measure (APM) – See Glossary
on slides 50/51. 22Full-year 2018 results / 13 March 2019
FINANCING POLICY
A stable debt level. A stable dividend.
HBF acquisition funded by non-core
asset disposals (Lagardère Active
assets and office buildings).
Historical dividends (€/share)
Leverage ratio
Net debt/Recurring EBITDA**
Ordinary dividend per share (€)
Extra dividend per share (€)
€1,368m €1,375m 9.0
6.0 5.7%*
2.2x 2.1x*
1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3
31/12/2017 31/12/2018 2011 2012 2013 2014 2015 2016 2017 2018
* On a proforma basis (as per credit facility covenant), including
12 months of HBF recurring EBITDA. On a reported basis, ratio is 2.2x. * Dividend yield based on €22.80 closing price on 12 March 2019.
** Alternative Performance Measure (APM) – See Glossary on slide 50/51.
23Full-year 2018 results / 13 March 2019
GROUP TARGET SCOPE
2018 Estimated impact REVISED 2018
(€m)
recurring EBIT of IFRS 16* recurring EBIT**
Lagardère Publishing (core business) 190 11 201
Lagardère Travel Retail (core business) 119 2 121
Other Activities*** (13) 1 (12)
Target scope 296 14 310
Non-retained scope – disposed 29 29
Non-retained scope – not disposed to date**** 76 2 78
Total Lagardère group 401 16 417
* IFRS 16 impact on buildings and other only. Impact on concession contracts of Travel Retail is neutralised in REVISED Recurring EBIT.
** See Glossary on slide 52/53.
*** Other Activities includes Lagardère News (French radio, Paris Match, JDD, Elle brand licensing), Entertainment activities, Group Corporate and
Lagardère Active Corporate (to be extinguished by 2020).
**** Please refer to slide 35. 24Full-year 2018 results / 13 March 2019 OUTLOOK 2019 RECURRING EBIT* GROWTH TARGET BASED ON TARGET SCOPE: The Lagardère group expects 2019 recurring EBIT* growth based on the target scope to be between 4% and 6% at constant exchange rates and excluding the acquisition of HBF. NON-RETAINED SCOPE – NOT DISPOSED TO DATE**: Based on constant exchange rates, the contribution to recurring EBIT in 2019 for businesses not disposed to date (which represented €78 million in 2018) is expected to be between €80 million and €90 million on a full-year basis. * Including IFRS 16 impact on buildings and other only. Impact on concession contracts of Travel Retail is neutralised in REVISED Recurring EBIT. See Glossary on slide 52/53. ** Recurring EBIT for assets disposed to date is minimal, since the Press business was deconsolidated with effect from 1 January 2019 and the amounts corresponding to the other assets are not significant. 25
APPENDICES TO
THE CONSOLIDATED
ACCOUNTS
Full-year 2018 results
13 March 2019Full-year 2018 results / 13 March 2019
CHANGES OF SCOPE: MAIN ITEMS
Lagardère Publishing
• Full consolidation in 2018 of Summersdale following the acquisition in November 2017.
• Full consolidation in 2018 of Jessica Kingsley Publishers following the acquisition in November 2017.
Lagardère Travel Retail
• Acquisition of Hojeij Branded Foods (HBF), a leading Foodservice travel operator in North America,
in November 2018.
Lagardère Active
• Acquisition of 52% of Skyhigh TV, a Dutch TV production company, in March 2018.
• Disposal of the minority stake (42%) of Marie Claire group.
• Disposal of MonDocteur in July 2018.
• Disposal of Radio businesses in the Czech Republic, Poland, Slovakia and Romania in July 2018.
• Disposal of Doctissimo in October 2018.
27Full-year 2018 results / 13 March 2019 CONSOLIDATED INCOME STATEMENT (€m) 2017* 2018 Revenue 7,084 7,258 Group recurring EBIT** 399 401 Income from equity-accounted companies*** 3 4 Non-recurring/non-operating items (127) 4 Total EBIT 275 409 Finance costs, net (73) (59) Profit before tax 202 350 Income tax (expense) benefit 2 (134) Profit for the period 204 216 Attributable to minority interests 28 22 Profit – Group share 176 194 * Restated for IFRS 15 using the retrospective method. ** Alternative Performance Measure (APM) – See Glossary on slides 50/51. *** Before impairment losses. 28
Full-year 2018 results / 13 March 2019 CONSOLIDATED STATEMENT OF CASH FLOWS (€m) 2017* 2018 Cash flow from operations before changes in working capital 536 505 Changes in working capital (71) 55 Income taxes paid (89) (77) Net cash from operating activities 376 483 Purchases of property, plant & equipment and intangible assets (253) (270) Disposals of property, plant & equipment and intangible assets*** 160 258 Free cash flow** 283 471 Purchases of investments (68) (340) Disposals of investments 19 148 Net cash from operating and investing activities 234 279 Dividend paid and other (143) (229) Interest paid (70) (57) Change in net debt 21 (7) Net debt** (1,368) (1,375) * Restated for IFRS 15 using the retrospective method. ** Alternative Performance Measure (APM) – See Glossary on slides 50/51. *** Including €7m of non-property disposals in 2018 and €5m in 2017. 29
Full-year 2018 results / 13 March 2019
FREE CASH FLOW EXCLUDING PROPERTY DISPOSALS
(€m) 2017* 2018
Free cash flow excluding property disposals 158 288
Proceeds from disposals 155 251
Tax paid on disposals (28) (42)
Refitting costs (2) (26)
Proceeds from property disposals net of tax paid
125 183
and related refitting costs
Free cash flow** 283 471
* Restated for IFRS 15 using the retrospective method.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 30Full-year 2018 results / 13 March 2019
ANALYSIS OF NON-RECURRING/NON-OPERATING ITEMS IN 2018
Lagardère
Lagardère Lagardère Lagardère Sports and Other Total Total
(€m) Publishing Travel Retail Active Entertainment Activities 2018 2017*
Group recurring EBIT** 190 119 75 30 (13) 401 399
Income from equity-accounted
1 2 1 4 3
companies
Restructuring costs (21) (6) (44) (8) (79) (41)
Gains (losses) on disposals (3) 207 1 205 43
Impairment losses (4) (40) (2) (1) (47) (57)
Amortisation of acquisition-related
(5) (59) (2) (7) (2) (75) (72)
intangible assets and expenses
EBIT 165 49 197 13 (15) 409 275
* Restated for IFRS 15 using the retrospective method.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 31Full-year 2018 results / 13 March 2019
ADJUSTED PROFIT – GROUP SHARE
(€m) 2017* 2018
Profit for the period 204 216
Restructuring costs 41 79
Gains/losses on disposals -43 -205
Impairment losses on goodwill, PP&E, intangible assets and investments in
57 47
equity-accounted companies
Amortisation of acquisition-related intangible assets and expenses 72 75
Tax effects on the above transactions -17 41
Tax paid on dividends, reimbursements and surtax in France -6 -
Recognition of tax loss carryforwards in France (planned sale of a building) -40 -
Remeasurement of deferred taxes (US tax reform) -19 -
Adjusted profit 249 253
o/w attributable to minority interests 35 31
Adjusted profit – Group share** 214 222
* Restated for IFRS 15 using the retrospective method.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 32Full-year 2018 results / 13 March 2019
GROUP PROFILE – 2018
Revenue by division Group recurring EBIT by division
Lagardère Sports and Entertainment Lagardère Sports and Entertainment
6% 7%
Lagardère Lagardère
Active Active
12% 18%
Lagardère Lagardère
Publishing Publishing
31% 46%
Lagardère Lagardère
Travel Travel
Retail Retail
51% 29%
2017 revenue by geographic area 2018 revenue by geographic area
US & US &
Canada Canada
20% France 21% France
32% 31%
Eastern
Europe Eastern
11% Europe
11%
Asia-
Pacific Asia-
9% Western Pacific Western
Other Europe 9% Europe
24% Other 25%
4% 3%
Emerging countries: 24% Emerging countries: 23% 33Full-year 2018 results / 13 March 2019
RECAP OF PERFORMANCE BY DIVISION – 2018
Revenue
Consolidated Consolidated
2018 Like-for-like change*
(€m) change change
Lagardère Publishing 2,252 -€37m -1.6% -1.2%
Lagardère Travel Retail 3,673 +€261m +7.7% +8.8%
Lagardère Active 895 -€34m -3.6% -2.3%
Lagardère Sports and Entertainment 438 -€16m -3.6% -4.1%
Total 7,258 +€174m +2.5% +3.3%
Group recurring EBIT**
Consolidated Consolidated Change at constant
2018
(€m) change change exchange rates
Lagardère Publishing 190 -€20m -9.7% -8.1%
Lagardère Travel Retail 119 +€7m +6.9% +8.0%
Lagardère Active 75 +€5m +6.8% +11.1%
Lagardère Sports and Entertainment 30 +€8m +42.8% +44.1%
Other Activities (13) +€2m +0.3% -6.8%
Total 401 +€2m +0.5% +2.1%
* At constant scope and exchange rates.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 34Full-year 2018 results / 13 March 2019
NON-RETAINED SCOPE RECURRING EBIT
Estimated REVISED2018
2018 recurring Scope
(€m) impact of
impact
recurring
EBIT
IFRS 16* EBIT**
Lagardère Active assets 75 0 (29) 46
Disposed
Disposals completed in 2018 3 - (3) -
Disposals completed in 2019 to date 26 - (26) -
Lagardère Studios 19 - 19
TV Channels 23 - 23
Not
disposed
Mezzo 3 - 3
to date Other*** 1 - 1
Lagardère Sports and Entertainment assets 30 2 32
Sports 30 2 32
Non-retained scope 105 2 (29) 78
* IFRS 16 impact on buildings and other only.
** See Glossary on slide 52/53.
*** o/w Moneytag, Sports.fr, Label Box. 35Full-year 2018 results / 13 March 2019
CASH FLOW STATEMENT DATA – LAGARDÈRE PUBLISHING
(€m) 2017 2018
Cash flow from operations before changes in working capital 227 197
Changes in working capital (63) (14)
Income taxes paid (60) (40)
Net cash from operating activities 104 143
Purchases of property, plant & equipment and intangible assets (46) (43)
Disposals of property, plant & equipment and intangible assets 0 1
Free cash flow* 58 101
Purchases of investments (30) (13)
Disposals of investments 12 1
Net cash from operating and investing activities 40 89
* Alternative Performance Measure (APM) – See Glossary on slides 50/51.
36Full-year 2018 results / 13 March 2019
CASH FLOW STATEMENT DATA – LAGARDÈRE TRAVEL RETAIL
(€m) 2017 2018
Cash flow from operations before changes in working capital 207 224
Changes in working capital 1 59
Income taxes paid (24) (21)
Net cash from operating activities 184 262
Purchases of property, plant & equipment and intangible assets (138) (130)
Disposals of property, plant & equipment and intangible assets 1 3
Free cash flow* 47 135
Purchases of investments (18) (308)
Disposals of investments 6 4
Net cash from (used in) operating and investing activities 35 (169)
* Alternative Performance Measure (APM) – See Glossary on slides 50/51.
37Full-year 2018 results / 13 March 2019
CASH FLOW STATEMENT DATA – LAGARDÈRE ACTIVE
(€m) 2017 2018
Cash flow from operations before changes in working capital 47 21
Changes in working capital (15) (27)
Income taxes paid (33) (79)
Net cash used in operating activities (1) (85)
Purchases of property, plant & equipment and intangible assets (8) (34)
Disposals of property, plant & equipment and intangible assets 0 250
Free cash flow* (9) 131
Purchases of investments (12) (12)
Disposals of investments 3 142
Net cash from (used in) operating and investing activities (18) 261
* Alternative Performance Measure (APM) – See Glossary on slides 50/51.
38Full-year 2018 results / 13 March 2019 CASH FLOW STATEMENT DATA – LAGARDÈRE SPORTS AND ENTERTAINMENT (€m) 2017 2018 Cash flow from operations before changes in working capital 61 72 Changes in working capital 18 37 Income taxes paid (6) (8) Net cash from operating activities 73 101 Purchases of property, plant & equipment and intangible assets (59) (62) Disposals of property, plant & equipment and intangible assets 2 4 Free cash flow** 16 43 Purchases of investments (6) (1) Disposals of investments (3) 1 Net cash from operating and investing activities 7 43 * Restated for IFRS 15 using the retrospective method. ** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 39
Full-year 2018 results / 13 March 2019
CONSOLIDATED BALANCE SHEET
(€m) 31 Dec. 2017* 31 Dec. 2018
Non-current assets 4,007 3,987
Investments in equity-accounted companies 123 73
Current assets 2,941 2,742
Short-term investments and cash 546 710
Assets held for sale 6 699
TOTAL ASSETS 7,623 8,211
Total equity 1,924 2,001
Non-current liabilities 737 810
Non-current debt** 1,542 1,019
Current liabilities 3,048 2,902
Net debt**** stable at €1,375m
Current debt*** 372 1,066
(vs. €1,368m at 31 Dec. 2017)
Liabilities associated with assets held for sale 0 413
TOTAL LIABILITIES AND EQUITY 7,623 8,211
* Restated for IFRS 15 using the retrospective method.
** Including €18m of long-term derivative assets at 31 December 2017 and a long-term derivative assets €5m and a long-term derivatives liabilities €1m at 31 December 2018.
*** Including €3m of short-term derivative assets at 31 December 2018 and 31 December 2017.
**** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 40Full-year 2018 results / 13 March 2019
OFF-BALANCE SHEET COMMITMENTS
(€m) 2017 2018
Commitments to purchase shares from third parties
0 0
(other than minority interests)
Commitments given in connection with ordinary activities:
- contract guarantees and performance bonds 361 348
- guarantees in favour of third parties or
110 88
non-consolidated companies
- other commitments given 6 5
Commitments received:
- counter-guarantees of commitments given 1 0
- other commitments received 2 2
Mortgages and pledges 0 1
41Full-year 2018 results / 13 March 2019
LAGARDÈRE TRAVEL RETAIL
GUARANTEED MINIMUM PAYMENTS
At 31 December 2018 entities forming part of Lagardère Travel Retail had guaranteed minimum future payments
amounting to €2,450m under concession agreements.
These payments break down as follows by maturity:
Maturity 2019 2020 2021 2022 2023 2024
& beyond Total 2017
(€m)
Guaranteed minimum
payments under
478 423 396 343 261 549 2,450 1,876
concession
agreements
42Full-year 2018 results / 13 March 2019
LAGARDÈRE SPORTS AND ENTERTAINMENT
GUARANTEED MINIMUM PAYMENTS
At 31 December 2018 entities forming part of Lagardère Sports and Entertainment had guaranteed minimum future
payments amounting to €981m under long-term contracts for the sale of TV and marketing rights.
These payments break down as follows by maturity:
Maturity 2019 2020 2021 2022 2023 2024
& beyond Total 2017
(€m)
Guaranteed minimum
payments under
213 143 99 65 97 364 981 1,064
sports rights
marketing contracts
At 31 December 2018 the amounts due under marketing contracts signed by these same entities with broadcasters
and partners amounted to €1,513m, breaking down as follows by maturity:
Maturity 2019 2020 2021 2022 2023 2024
& beyond Total 2017
(€m)
Sports rights
marketing contracts
signed with 488 357 167 133 102 266 1,513 1,550
broadcasters and
partners
43Full-year 2018 results / 13 March 2019
RECURRING EBITDA – OVER 12 ROLLING MONTHS
(€m) 2017* 2018
Group recurring EBIT** 399 401
Depreciation and amortisation of property, plant
+193 +202
& equipment and intangible assets
Amortisation of signing fees +24 +17
Dividends received from equity-accounted
+6 +5
companies
Recurring EBITDA** 622 625
Recurring EBITDA** including pro forma HBF 654
* Restated for IFRS 15 using the retrospective method.
** Alternative Performance Measure (APM) – See Glossary on slides 50/51. 44Full-year 2018 results / 13 March 2019
FINANCING POLICY
86% of gross debt funding contracted 2019 bond refinancing will reshuffle repayment
directly with credit investors. schedule positively.
Bonds
Bank loans & other
Authorised
Commercial paper credit lines**: €1,250m
24%
62% €499m
14% €492m
€71m
Cash*: €710m €297m
€496m €152m
€26m €48m
€4m
Available 2019 2020 2021 2022 2023 2024 &
cash beyond
* Short-term investments and cash, excluding €8m of derivative assets.
** Undrawn Group credit facility excluding authorised credit lines at divisional level.
45APPENDICES
ESTIMATED IMPACTS
OF IFRS 16 ON 2018
CONSOLIDATED
ACCOUNTS
Full-year 2018 results
13 March 2019Full-year 2018 results / 13 March 2019
ESTIMATED IMPACT OF IFRS 16 ON 2018 CONSOLIDATED INCOME STATEMENT
AND RELATED INDICATORS
IFRS 16
(€m) impacts 2018
Revenue -
REVISED recurring EBITDA* -
REVISED Group recurring EBIT* +16 Buildings and other
Income from equity-accounted companies** -1
Non-recurring/non-operating items +42 Concessions stores
Of which Cancellation of fixed rental expense*** - concession stores NEW +441
Of which Depreciation of right-of-use asset - concession stores NEW -395
Of which Gains and losses on lease modifications NEW -4
Total EBIT +57
Finance costs, net - o/w -€58m for concessions stores
Lease interest expense NEW -76
o/w -€18m for buildings and other
Profit before tax -19
Income tax expense +4
Profit for the period -15
Attributable to minority interests - o/w -€14m for concessions stores
Profit – Group share -15
o/w -€1m for buildings and other
REVISED Adjusted profit – Group Share* -1
* Alternative Performance Measure (APM) – See Glossary on slides 52/53. / ** Before impairment losses.
*** Cancellation of fixed rental expense is equal to the repayment of the lease liability, the associated change in working capital and interest paid in the statement of cash flows. 47Full-year 2018 results / 13 March 2019
ESTIMATED IMPACT OF IFRS 16 ON 2018 CONSOLIDATED STATEMENT
OF CASH FLOWS
(€m) 2018
Cash flow from operations before changes in working capital +533
o/w €439m for concessions stores
Repayment of lease liabilities NEW -453
Fixed rent payment of €529m
Interest paid on lease liabilities NEW -76 o/w €90m for buildings and other
Cash flow from operations before changes in working capital* +4
Changes in working capital -4
Income taxes paid -
Net cash from operating activities -
Purchases of property, plant & equipment and intangible assets -
Disposals of property, plant & equipment and intangible assets -
REVISED Free cash flow* -
Purchases of investments -
Disposals of investments -
Net cash from operating & investing activities -
Dividend paid and other -
Interest paid -
Change in net debt -
Net debt* -
* Alternative Performance Measure (APM) – See Glossary on slides 51 and 53. 48Full-year 2018 results / 13 March 2019
ESTIMATED IMPACT OF IFRS 16 ON 2018 CONSOLIDATED BALANCE SHEET
(€m) 31 Dec. 2018 (€m) 31 Dec. 2018
Total equity -128
Non-current assets +2,480
Non-current liabilities +2,180
Right-of-use asset NEW +2,433 Lease liability non current NEW + 2,180
o/w concession stores +1,897 o/w concession stores +1,638
o/w buildings and other +536 o/w buildings and other +542
Deferred tax liabilities
Deferred tax asset +47
Non-current debt -
Investments in equity-accounted +414
Current liabilities
companies -3
Lease liability current NEW +440
Current assets -11 o/w concession stores +372
o/w buildings and other +68
Short-term investments and cash - Other current liabilities -26
Current debt -
Liabilities associated with assets held
Assets held for sale +2 for sale +2
TOTAL ASSETS +2,468 TOTAL LIABILITIES AND EQUITY +2,468
49Full-year 2018 results / 13 March 2019 GLOSSARY (1/4) Lagardère uses alternative performance measures which serve as key measures of the Group's operating and financial performance. These indicators are tracked by the Executive Committee in order to assess performance and manage the business, as well as by investors in order to monitor the Group's operating performance, along with the financial metrics defined by the IASB. These indicators are calculated based on accounting items taken from the consolidated financial statements prepared under IFRS and a reconciliation with those items is provided either in this presentation or in the press release or in the notes to the consolidated financial statements. The like-for-like change in revenue is calculated by comparing: • 2018 revenue to exclude companies consolidated for the first time during the period, and 2017 revenue to exclude companies divested in 2018; • 2018 and 2017 revenue based on 2017 exchange rates. (See reconciliation in section VIII - Appendices of the full-year 2018 results press release) Recurring EBIT (Group recurring EBIT). The Group's main performance indicator is recurring operating profit of fully consolidated companies, which is calculated as follows: Profit before finance costs and tax excluding: • Income (loss) from equity-accounted companies before impairment losses; • Gains (losses) on disposals of assets; • Impairment losses on goodwill, property, plant and equipment, intangible assets and investment in equity-accounted companies; • Net restructuring costs; • Items related to business combinations: - Acquisition-related expenses; - Gains and losses resulting from purchase price adjustments and fair value adjustment due to changes in control; - Amortisation of acquisition-related intangible assets. • Specific major disputes unrelated to the Group's operating performance. (See reconciliation on slide 18) 50
Full-year 2018 results / 13 March 2019 GLOSSARY (2/4) Operating margin is calculated by dividing recurring EBIT of fully consolidated companies (Group recurring EBIT) by revenue. Recurring EBITDA over a rolling 12-month period is calculated as recurring EBIT of fully consolidated companies (Group recurring EBIT) plus dividends received from equity-accounted companies, less amortisation and depreciation charged against intangible assets and property, plant and equipment, less amortisation of signing fees. (See slide 44 for reconciliation with Recurring EBIT of fully consolidated companies) Adjusted profit – Group share is calculated on the basis of profit for the period, excluding non-recurring/non-operating items, the related tax effect and minority interests, as follows: Profit for the period excluding: • Gains (losses) on disposals of assets; • Impairment losses on goodwill, property, plant and equipment, intangible assets and investments in equity-accounted companies; • Net restructuring costs; • Items related to business combinations: - Acquisition-related expenses; - Gains and losses resulting from purchase price adjustments and fair value adjustments due to changes in control; - Amortisation of acquisition-related intangible assets. • Specific major disputes unrelated to the Group's operating performance; • Tax effects of the above items, including the tax on dividends paid in France; • Non-recurring changes in deferred taxes; • Adjusted profit attributable to minority interests (Profit for the period attributable to minority interests plus minority interests on the above items). (See slide 32 for reconciliation with Profit for the period) Free cash flow is calculated as cash flow from operations plus net cash flow relating to acquisitions and disposals of intangible assets and property, plant and equipment. (See reconciliation on slide 29) Net debt is calculated as the sum of the following items: Short-term investments and cash and cash equivalents, Financial instruments designated as hedges of debt, non-current debt and current debt. (See reconciliation on slide 40) 51
Full-year 2018 results / 13 March 2019 GLOSSARY (3/4) In the context of the first-time application of IFRS 16 – Leases, effective 1 January 2019, the Group has elected to retain its existing alternative performance measures with certain modifications, in particular the neutralisation of pure accounting effects and distortions created by the new standard on the concessions businesses. From 1 January 2019, these indicators will be monitored by the Executive Committee to assess operating performance and manage the business, along with the financial metrics defined by the IASB. These indicators will be calculated based on accounting items taken from the consolidated financial statements prepared under IFRS and a reconciliation with those items will be provided. To prevent any confusion during the transition period between the alternative performance measures before and after the application of IFRS 16, each corresponding definition is preceded with “REVISED”. The estimated impacts of the application of IFRS 16 on the 2018 consolidated financial statements are set out on slides 47 to 49. REVISED Recurring EBIT (REVISED Group recurring EBIT). The Group's main performance indicator is recurring operating profit of fully consolidated companies, which is calculated as follows: Profit before finance costs and tax excluding: • Income (loss) from equity-accounted companies before impairment losses; • Gains (losses) on disposals of assets; • Impairment losses on goodwill, property, plant and equipment, intangible assets and investment in equity-accounted companies; • Net restructuring costs; • Items related to business combinations: - Acquisition-related expenses; - Gains and losses resulting from purchase price adjustments and fair value adjustment due to changes in control; - Amortisation of acquisition-related intangible assets. • Specific major disputes unrelated to the Group's operating performance. • Items related to leases: (NEW) - Cancellation of fixed rental expense* on concessions; - Depreciation of right-of-use assets on concessions; - Gains and losses on lease modifications. * Cancellation of fixed rental expense is equal to the repayment of the lease liability, the associated change in working capital and interest paid in the statement of cash flows. 52
Full-year 2018 results / 13 March 2019 GLOSSARY (4/4) REVISED Recurring EBITDA over a rolling 12-month period is calculated as REVISED recurring EBIT of fully consolidated companies (REVISED Group recurring EBIT) plus dividends received from equity-accounted companies, less amortisation and depreciation charged against intangible assets and property, plant and equipment, less amortisation of signing fees, less depreciation of right-of-use assets for buildings and other items (NEW), less cancellation of fixed rental expense* for buildings and other items (NEW). REVISED Adjusted profit – Group share is calculated on the basis of profit for the period, excluding non-recurring/non-operating items, the related tax effect and minority interests, as follows: Profit for the period excluding: • Gains (losses) on disposals of assets; • Impairment losses on goodwill, property, plant and equipment, intangible assets and investments in equity-accounted companies; • Net restructuring costs; • Items related to business combinations: - Acquisition-related expenses; - Gains and losses resulting from purchase price adjustments and fair value adjustments due to changes in control; - Amortisation of acquisition-related intangible assets. • Specific major disputes unrelated to the Group's operating performance; • Items related to leases: (NEW) - Cancellation of fixed rental expense* on concessions; - Depreciation of right-of-use assets on concessions; - Interest expense on lease liabilities on concessions; - Gains and losses on lease modifications. • Tax effects of the above items, including the tax on dividends paid in France; • Non-recurring changes in deferred taxes; • Adjusted profit attributable to minority interests (Profit for the period attributable to minority interests plus minority interests on the above items). REVISED Free cash flow is calculated as cash flow from operations including repayment of lease liabilities and associated interest paid (NEW) plus net cash flow relating to acquisitions and disposals of intangible assets and property, plant and equipment. * Cancellation of fixed rental expense is equal to the repayment of the lease liability, the associated change in working capital and interest paid in the statement of cash flows. 53
SIGNIFICANT EVENTS Full-year 2018 results 13 March 2019
Full-year 2018 results / 13 March 2019
BACKGROUND AND OVERALL PERFORMANCE
Revenue down -1.2% at €2,252m like-for-like.
Recurring EBIT down by -€20m at €190m.
• Education (high margin segment) impacted by anticipated absence of curriculum reform in France, UK and Spain.
• Partially offset by a solid performance on the trade segment in the US and the contribution of acquisitions in the UK.
• Contribution of recent acquisitions (+€30m) more than offset by negative foreign exchange effect (-€40m).
55Full-year 2018 results / 13 March 2019
FRANCE
Strong Christmas revenue offset disappointing autumn in otherwise flat (+0.2%) trade market.
+0.8% gain in trade market share.
Education at an all-time low due to freeze in curriculum reform as government defines new policy.
Unfavourable comparative with 2017 (no Asterix album).
Overall sales performance down -3.8%.
Acquisition of La Plage publishing house in July 2018.
Lagardère Publishing entered into exclusive negotiations to acquire Gigamic in January 2019.
56Full-year 2018 results / 13 March 2019
INTERNATIONAL MARKETS
UK: record-setting revenue and recurring EBIT in adult trade and children’s segments thanks to numerous bestsellers.
• Education lagging due to absence of substantial curriculum reform in primary and secondary.
• Stellar performance of recent acquisitions (Summersdale, Jessica Kingsley, Bookouture).
US: revenue and recurring EBIT exceeding prior year.
• The President is Missing biggest novel of 2018 with 1.3 million copies sold.
• Acquisition of Worthy Publishing Group, a religious book publisher based in Nashville.
Spain and Latin America: revenue and recurring EBIT in Education down in Spain due to budget cuts and political
instability, partly offset by growth in Mexico.
Partworks: flat sales, rising profit confirm division’s #1 worldwide ranking.
57Full-year 2018 results / 13 March 2019
DIGITAL
e-Book decline in the US and the UK compensated by spectacular growth of audiobooks (+30% per year) for fourth
year in a row.
e-Books accounted for 7.9% of total Lagardère Publishing revenue in 2018, with the proportion remaining stable
versus 2017, while digital audiobooks represented 2.7% of revenue versus 2.0% in 2017.
Hachette Innovation Program now fully operational, promoting a culture of innovation and forming partnerships with
relevant start-ups.
58SIGNIFICANT EVENTS Full-year 2018 results 13 March 2019
Full-year 2018 results / 13 March 2019 BACKGROUND AND OVERALL PERFORMANCE Acquisition of HBF successfully completed and integration plan launched. Solid like-for-like revenue growth (up 8.8%) driven by a combination of traffic growth, success of new concepts and commercial initiatives, as well as net concessions gains. Margins stable as a % of sales as start-up expenses have been compensated by solid improvement of the existing business. Positive dynamic in terms of business development: • North America: opening of several stores at Austin, Charlotte, Raleigh, Cincinnati, San Francisco, Denver, Philadelphia and Dallas; • Italy: new concession wins in Rome, Trieste, Brindisi and Bari; • Spain: opening of four Foodservice units at Malaga airport in Q3 2018; • Austria: opening of five Foodservice outlets at Salzburg station in Q2 2018; • United Arab Emirates: opening of food court Daily DXB in Dubai International airport T3 in Q2 2018; • China: very strong network development notably in Shanghai and Wuhan; • New Zealand: opening at the end of the year of Duty Free units at Christchurch airport. The growth in passenger traffic* (up 6.3%) remains solid. Strong in Europe (up 6.3%), North America (up 5.2%) and Asia-Pacific (up 8.0%). Challenging FX effect on currencies against euro. * Source: Lagardère Travel Retail internal data and ACI data from January to September 2018. 60
Full-year 2018 results / 13 March 2019
FRANCE
Travel Essentials: 100% revenue up 2.9% vs. 2017.
• Of which +3.6% for the LFL network fuelled by (i) Paris airport network (+11.6% LFL fuelled by both traffic and SPP improvement) and
(ii) +3.0% for the SNCF network despite 36 days of strikes which significantly impacted business from April to June.
• Non LFL performance is driven by:
- the negative impact of the planned RATP network closure program; partly offset by full-year impact of 2017 openings (Nice T2, Marks
& Spencer Lille Flandres and CDG 2F, Fnac Lyon Airport) and 2018 openings, including Marks & Spencer (CDG 1 and Roissypôle)
openings and various regional airports such as Pau and Nice (Monop).
Foodservice: 100% revenue up 10.3% vs. 2017.
• +4.4% growth in the LFL network fueled by +7.5% growth in airports and +4.2% growth in the hospital network.
• Non LFL performance is driven by:
- the full-year impact of 2017 openings including Nice T2 and 2018 openings such as Teppan restaurant in Paris airport, regional airport
expansion (Toulouse, Pau); and openings in the hospital network (Lyon, Montpellier);
- these positive effects offset contract losses (Rennes, Caen, Arras).
Duty Free & Fashion: 100% revenue up 5.0% vs. 2017.
• LFL network is flat at +0.3%.
• Non LFL performance is fuelled by:
- full-year performance of Nice, Lyon and La Réunion airports and Gare du Nord shop after store openings and concept modernisation
in 2017 (e.g., new walkthrough in Nice T1 and T2) and positive impacts of commercial initiatives;
- openings of new concepts in Paris in 2018 (including the Beauty New Age concept in Terminal 2E) and the integration of La Maison
du Chocolat network.
61Full-year 2018 results / 13 March 2019
EMEA
Italy
• Strong revenue growth driven by network development in (i) Duty Free & Fashion in Venice, Bologna and Trieste; (ii) Foodservice with
openings in Palermo, Genoa, Venice and Rome Termini and overall strong growth in all the channels; (iii) Travel Essentials in Bari,
Brindisi, Venice and Rome thanks to successful roll-over of Relay concepts.
Poland
• Dynamic overall thanks to strong activity at regional airports (Modlin, Krakow, Gdansk, etc.) notably in Duty Free and Travel Essentials
more than offsetting negative network effect at Warsaw T2 from second half of the year.
Czech Republic
• Revenue up with continuous expansion at Prague airport, following the opening of several Fashion and Foodservice units.
Travel Essentials is very dynamic in the commute channel.
Other EMEA countries also posted strong revenue growth.
62Full-year 2018 results / 13 March 2019
NORTH AMERICA, ASIA AND PACIFIC
North America
• Closing of the HBF acquisition on 20 November 2018;
• Sustained traffic growth and strong network development both in Travel Essentials and Foodservice with awards in San Francisco and
in Orlando.
• Very favourable impact of the commercial initiatives as well as developments in concepts and the mix.
Asia
• Strong Hong Kong revenue growth with the successful opening of Foodservice units at the airport, as well as the development of the
sales to the JV with China Duty Free and the entry into the new high-speed railway station with five new Travel Essentials and Fashion
stores;
• China maintained solid revenue growth thanks to the good performance of the fashion stores at Shenzhen and the success of the new
developments in Fashion and Foodservice (Shanghai, Wuhan, Chongqing, Beijing).
Pacific
• Australian operations negatively impacted by work at Sydney Terminal 2 since May and an unfavourable network impact.
• Auckland benefitting from full year of Duty Free operations but all activities including the Travel Essentials units have been disrupted
by work at the International Terminal.
• Christchurch Duty Free concession opening in November; Travel Essentials units to be opened in 2019 as part of Master Concession.
63SIGNIFICANT EVENTS Full-year 2018 results 13 March 2019
Full-year 2018 results / 13 March 2019
STRATEGIC REFOCUSING AND REORGANISATION
In 2018, Lagardère Active focused on the strategic refocusing which was announced by Arnaud Lagardère on March
and May 2018.
Lagardère Active structured its organisation by creating five autonomous business units (Lagardère News, Audiovisual
Production and Distribution, Press, Television, Pure players and B2B), each with their own operating and functional resources.
• Except for Lagardère News which encompass Europe 1, the French music radio stations (Virgin Radio and RFM), Paris Match,
Le Journal du Dimanche and the license management business of the Elle brand, each other business units have been engaged in
a disposal process which was launched during the first half of the year.
Significant sales transactions were finalised during 2018 and early 2019.
• Disposal of most of the Group's international radio activities: sale of radio businesses in the Czech Republic, Poland, Slovakia
and Romania to Czech Media Invest was completed in July 2018 and the disposal of the radio and advertising sales brokerage assets
in South Africa was announced in February 2019 (closing of the transaction for the advertising sales brokerage subject to clearance
from the South African regulatory authorities)
• Sale of several Group magazine publishing titles in France, including the sale of Elle and its various extensions, Version Femina,
Art & Décoration, Télé 7 Jours and its various extensions, France Dimanche, Ici Paris and Public, to Czech Media Invest (CMI), which
was finalised in February 2019 (the Lagardère group remains the owner of the Elle brand in France and abroad).
• Disposal of the interest in Marie Claire in June 2018.
• Sale of the e-Health division: MonDocteur was sold in July 2018 and Doctissimo in October 2018; other Pure player and B2B assets
also sold (notably Boursier.com in January 2019 and Billetreduc.com and Plurimedia in February 2019).
Other significant transactions are ongoing, notably with the start of exclusive negotiations announced for the sale of the
Television business (excluding Mezzo).
65Full-year 2018 results / 13 March 2019 MAGAZINE PUBLISHING Global audiences* for our most powerful brands are the following (i.e., on all devices: print, computer, smartphones and tablets): Elle (down 8.4%), Paris Match (up 1.6%), Télé 7 Jours (down 1.4%) and Public (up 16.5%). In a depressed print advertising market (down around 10.8%)**, our main titles outperformed their markets. Elle remained leader in high-end women’s magazines: with 26%** market share, far above its main competitors. Flagship publications (Elle à Table, Télé 7 Jours) are leaders on their competitive segments. Paris Match saw its market share remain stable during the year. In a declining circulation market (down 1.9%***), our main titles performed better than their market segment. Elle displayed one of the best trends in the high-end women’s weekly magazine segment. Paris Match remains leader in the news magazine segment and registered a better trend in global paid circulation. Télé 7 Jours is one of the leaders on its market in terms of news-stand circulation trends. The subscription revenue trend partially offset the news-stand decline. Digital revenues are still growing: Public**** is the leader in women’s mobile apps by audience and saw its global digital audience grow 42% since December 2017. Elle**** is the number one high-end digital women’s brand for upper socio-professional women. Launches in licensing activity: • Elle Italy became weekly in November 2018 (formerly monthly); • launch of Elle Decoration in Ukraine and Argentina; • launch of Elle Argentina website and continued international development of digital activities; • first edition of the Elle International Fashion & Luxury Management Program; • new international events and strategic projects (Elle Active in Japan, Italy, China; Elle Weekender UK; Elle Women in Tech (US, Norway); Elle International Beauty Awards, Elle Deco International Design Awards, etc.); • launch of numerous spin-offs (wedding, kids, decoration, etc.). Following the sale of most of the magazine titles in France to CMI, the Lagardère group remains the owner of the Elle brand in France and abroad. CMI has been granted an exclusive license for the Elle brand covering France. * ACPM One Global; 2018 T3 vs. 2017 T3 study. / ** IREP; YTD09 2018 vs. YTD09 2017; Magazine Publishing // Kantar Media; January-December 2018; total pages except inserts, except various advertisements and infomedia. / *** ACPM-OJD; 2017/2018 vs. 2017; DSH DFP Mainstream Press. / **** Médiamétrie - NetRatings Internet Global; December 2018. 66
Full-year 2018 results / 13 March 2019 RADIO IN FRANCE Europe 1 • A new program grid to reposition the station was put in place by the new management team appointed in May 2018. Solid position of music radio in France • Virgin Radio now reaches 2,390,000 listeners and has a cumulative audience of 4.4%*. • RFM now reaches 2,030,000 listeners and has a cumulative audience of 3.7%*. * Médiamétrie; November-December 2018. 67
Full-year 2018 results / 13 March 2019 TELEVISION ACTIVITIES – TV CHANNELS Gulli recorded its best-ever audience figures in 2018 and is thus the leader in terms of audiences* on the 4/10-year old target (audience share 18.9%) and on the 4/14-year old target (audience share 16.4%) as regards the French television market, ahead of TF1 and France 4. Lagardère Active’s TV hub is the #1 kids group in France including Gulli but also Canal J & TiJi**, benefiting from a high recognition rate (99% of households with children know at least one of these TV channels)***. Over the years, this Kids TV & Entertainment hub has gained a significant international presence with at least one channel broadcast in 91 countries (in Europe, Africa, Middle East and Asia). * Médiamétrie measure; national Médiamat measure; consolidated audience from 6 am to 8 pm and from 3 am to 27 pm; 2018 Youth Barometer. ** Médiamétrie - Médiamat Thématik; consolidated audience 4/10 y.o. from 3 am to 27 pm – from 1/1/2018 until 03/06/2018. *** CSA; Observatoire CSA research 2018 – Fame of TV channels; April 2018. 68
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