Technicolor announces today its results for the full year 2017.
Technicolor: Full Year 2017 Results
Paris (France), 21 February 2018 – Technicolor (Euronext Paris: TCH; OTCQX: TCLRY) announces today its results for the full year 2017.
Frederic Rose, Chief Executive Officer of Technicolor, stated:
"2017 was particularly challenging for Technicolor which, nonetheless, showcased the underlying resilience of its operating businesses. The second half of the year showed significant improvement, versus the first half. The pending sale of our Patent Licensing business will be a watershed moment, simplifying our operational model and clearly increasing visibility on our performance, removing conflicts and complexity for all stakeholders. Post-sale, we can focus our capital resources on our key operating businesses – Entertainment Services and Connected Home – alongside our measures to reduce our corporate cost structure, to ensure Technicolor achieves profitable growth and higher levels of free cash flow."
Full Year 2017 Key Indicators from continuing operations
Second Half |
Full Year |
|||||
In € million |
2016 |
2017 |
At constant |
2016 |
2017 |
At constant |
Revenues from continuing operations |
2,374 |
2,133 |
(5.4)% |
4,628 |
4,231 |
(6.8)% |
Adjusted EBITDA from continuing operations |
233 |
209 |
(6.4)% |
359 |
291 |
(17.2)% |
As a % of revenues |
9.8% |
9.8% |
- |
7.8% |
6.9% |
(90)bps |
Free Cash Flow from continuing operations |
111 |
172 |
+55.5% |
88 |
63 |
(26.6)% |
Technicolor announced, on December 18, 2017, its decision to sell its Patent Licensing business and that it was in advanced negotiations with a third party. As a result, the Group reported the financial information of its Patent Licensing business, previously included in the Technology segment, under discontinued operations. 2016 results were represented for comparative purposes. R&I and Trademark Licensing activities are now reported under Corporate & Other segment for both years.
Full Year 2017 Key Highlights
Strategy Update
As a result of the strategic transaction for its Patent Licensing activities, Technicolor will focus on developing its two operating business segments as follows:
The Group will continue to rely on its world class Research and Innovation Group to develop new tools, such as mixed reality production and new in-home services.
Technicolor's operational and financial profile will also be strengthened by corporate cost reductions and by applying all cash proceeds related to the Patent Licensing business to pay down debt. This will also include the cash settlement received from Samsung in the first quarter of 2018.
2018 Assumptions by Segment
Entertainment Services:
Connected Home:
Based on these assumptions, Technicolor expects an Adjusted EBITDA from the continuing operations broadly stable at constant rate compared to 2017.
Mid-term Outlook
In 2017, the Group initiated a strategic refocus on its core operating businesses with the advanced negotiations regarding the sale of the Patent Licensing activity. This strategy led to a major change in the Group's business model and a significant evolution in its cash generation profile in a more challenging environment. The objectives of the Drive 2020 strategic plan have therefore evolved.
After reaching a low point in 2018, below 2017 levels, Technicolor expects free cash flow from continuing operations to reach a run rate of at least €130 million by 2020, resulting from an Adjusted EBITDA which is expected to be above €350 million, relying on the following drivers:
These mid-term objectives are at constant exchange rates compared to 2017.
Dividend
The Board of Directors of Technicolor will not propose a dividend to the 2018 Annual General Meeting of Shareholders in light of 2017 financial performance.
Management update
Technicolor announces the departure of Esther Gaide, the Group's Chief Financial Officer, who will leave the Group on 20 March 2018 to pursue a new professional opportunity. Her successor will be announced shortly.
An analyst audio webcast hosted by Frederic Rose, CEO, and Esther Gaide, CFO, will be held Wednesday, 21 February 2018 at 6:30pm CET.
Link to the Audio Webcast
http://www.technicolor.com/webcastFY2017
(The presentation slides will be made available on our website prior to the webcast)
The replay will be available at the latest by 9:30pm (CET) on February 21st, 2018
Financial calendar
Q1 2018 business update |
25 April 2018 |
H1 2018 results |
25 July 2018 |
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Warning: Forward Looking Statements
This press release contains certain statements that constitute "forward-looking statements", including but not limited to statements that are predictions of or indicate future events, trends, plans or objectives, based on certain assumptions or which do not directly relate to historical or current facts. Such forward-looking statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the future results expressed, forecasted or implied by such forward-looking statements. For a more complete list and description of such risks and uncertainties, refer to Technicolor's filings with the French Autorité des marchés financiers.
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About Technicolor
Technicolor, a worldwide technology leader in the media and entertainment sector, is at the forefront of digital innovation. Our world class research and innovation laboratories enable us to lead the market in delivering advanced video services to content creators and distributors. Our commitment: supporting the delivery of exciting new experiences for consumers in theaters, homes and on-the-go.
www.technicolor.com – Follow us: @Technicolor – linkedin.com/company/technicolor
Technicolor shares are on the NYSE Euronext Paris exchange (TCH) and traded in the USA on the OTCQX marketplace (OTCQX: TCLRY).
Investor Relations
Emilie Megel : +33 1 41 86 61 48
emilie.megel@technicolor.com
Christophe Le Mignan : +33 1 41 86 58 83
christophe.lemignan@technicolor.com