TECHNICOLOR: TRADING COMMENTARY FOR THE FIRST QUARTER OF 2017
(Thomson Reuters ONE) -
PRESS RELEASE
Technicolor: trading commentary
Performance in line with Group's expectations
2017 objectives confirmed
Paris (France), 27 April 2017 - Technicolor (Euronext Paris: TCH; OTCQX: TCLRY)
today reports its trading commentary for the first quarter of 2017.
Technicolor's performance in the first quarter was in line with Group's
expectations and the outlook for 2017 remains unchanged.
During the first quarter, revenues were down year-over-year, as expected, due to
an unfavorable comparison basis in the Connected Home and Technology segments.
In the Connected Home segment, the level of activity with the largest operators
of the US has been solid, fueled by the roll-out of several flagship products,
as exemplified by the large volumes of WorldBox delivered to Charter and
shipment of a new high-end video product to AT&T initiated during the quarter.
Overall performance was, however, weaker than last year due to the very low
level of activity in Mexico in line with 2016 fourth quarter trends and a lower
performance in Europe. Revenues were impacted negatively in Europe during the
quarter due to delays in shipments to a large customer and by the end of a
number of large deployments. Besides, Technicolor continued to record solid
commercial successes and won several new contracts, including a large number of
awards for OTT products based on Android TV. In total, the Group has won 20
contracts for OTT set-top boxes in the past 18 months, representing close to
50% of the worldwide awards for this category of products.
The market environment for Production Services continues to flourish with strong
demand for premium content across the different market segments. The Group
demonstrated its continued leadership position in delivering visual effects for
premium content and recognized with the Oscar for best visual effect for the
Jungle Book at the 2017 Academy Awards. In addition, the Group is achieving
significant growth rates in Animation and Games due to the ramp-up of several
long feature animation projects and an extended scope of services for its Game
customers.
In the physical media segment, overall disc volumes were down, in line with
Group's expectations and reflected a weaker slate of releases compared to the
first quarter of 2016 that benefited from the record setting performance of Star
Wars: The Force Awakens, and from a higher number of AAA Games releases.
The Technology segment made good progress in its licensing programs during the
quarter. Revenues were down compared to the first quarter of 2016 which
benefited from the signing of several major licensing agreements, including a
one-time lump-sum agreement - making for a challenging comparable.
Demonstrating the strength of Technicolor's IP portfolio and ability to protect
its intellectual property, patent infringement suits were filed in both Germany
and France against Samsung Electronics Corporation during the first quarter,
illustrating Technicolor's commitment to enforce its intellectual property
rights, when and where necessary.
During the first quarter, the Group further invested in developing its operating
businesses. The Connected Home segment increased its footprint in Asia-Pacific
through a partnership with Pioneer to penetrate the Japanese market and
increased its overall research efforts in Broadband. In Production Services, the
Group further progressed its capacity expansion program and has been hiring
additional creative talent to absorb its strong business pipeline. Production
Services' leadership in immersive experience projects continued, as seen in a VR
piece for the new Alien Covenant movie with the support of the recently
established Technicolor Experience Center and Technicolor's Research &
Innovation labs.
While investing in its future, the Group also continued to reinforce its balance
sheet. Technicolor raised incremental term loans of ?275 million and $300
million at the end of March, the proceeds of which were used to entirely repay
its old term loans maturing in 2020. This allowed the Group to simplify its
financial structure as the term loans were issued under the new term loan debt
agreement signed in December 2016 which is covenant-lite and maturing in 2023.
The refinancing transactions and debt repayments that occurred in 2016 and 2017
year-to-date will result in around ?30 million of interest cost savings on an
annual run rate basis.
Reminder of 2017 objectives
* Adjusted EBITDA in the range of ?460 million to ?520 million;
* Free cash flow in excess of ?150 million before cash impacts of the Cathode
Ray Tube ("CRT") cartel case settlements (c. ?(81) million).
The Group will pursue its deleveraging with the aim to reach a net Debt to
Adjusted EBITDA ratio of 0.8x following which it will increase the return paid
to shareholders.
These objectives are calculated based on constant exchange rates, and integrate
the uncertainties in determining the timing to resolve the patent litigation
against Samsung Electronics and the money at stake.
Financial calendar
+------------------------+--------------+
| Annual General Meeting | 24 May 2017 |
+------------------------+--------------+
| H1 2017 Results | 27 July 2017 |
+------------------------+--------------+
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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.
###
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. We also benefit from an
extensive intellectual property portfolio focused on imaging and sound
technologies. Our commitment: supporting the delivery of exciting new
experiences for consumers in theaters, homes and on-the-go.
www.technicolor.com - Follow us: (at)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(at)technicolor.com
Christophe Le Mignan: +33 1 41 86 58 83
christophe.lemignan(at)technicolor.com
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Source: TECHNICOLOR via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 27.04.2017 - 07:30 Uhr
Sprache: Deutsch
News-ID 538638
Anzahl Zeichen: 8991
contact information:
Town:
Issy-les-Moulineaux Cedex
Kategorie:
Business News
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