Market Overview

Azteca Announces EBITDA of Ps.1,060 Million for the Third Quarter of 2012

Share:

—Net sales increase to Ps.3,198 million—

—Net income grows 89%, to Ps.718 million—

—During the first nine months of the year, net sales expand 7%, to Ps.8,943 million—

MEXICO CITY, Oct. 25, 2012 /PRNewswire/ -- 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 third quarter, and first nine months of 2012.

Third quarter results

Net sales for the quarter were Ps.3,198 million, 2% above the Ps.3,122 million for the same quarter of 2011.  Total costs and expenses were Ps.2,138 million, from  Ps.1,906 million in the same period of the previous year.  As a result, Azteca reported EBITDA of Ps.1,060 million, from Ps.1,217 million for the same period of last year. The EBITDA margin was 33%.

The company registered net income of Ps.718 million, 89% higher than the Ps.380 million for the same quarter of 2011.





3Q 2011

3Q 2012

Change







Ps.

%











Net sales

$3,122

$3,198

$76

2%











EBITDA    

$1,217

$1,060

$(157)

-13%











Net income    

$380

$718

$338

89%











Net income per CPO

$0.13

$0.24

$0.11

89%











Figures in millions of pesos.
EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization. The number of CPOs outstanding as of September 30, 2011 was 2,985 million and as of September 30, 2012 was 2,984 million.





Net sales

Domestic ad sales were Ps.2,923 million in the period, 6% above the Ps.2,765 million from the same period of the previous year. The increase reflects the solid interest of numerous advertisers in Mexico to reach their target markets through the programming of Azteca.

Sales were complemented by revenue from Azteca America—the company's wholly-owned broadcast television network focused on the U.S. Hispanic market—of Ps.229 million, compared to Ps.258 million a year ago.

Programming sales to other countries were Ps.46 million in the period, from Ps.99 million from the previous year. The revenue resulted from the export of the programs Los Rey and La Mujer de Judas to Europe, as well as Cielo Rojo to Central America, Europe, and Asia.

Costs and expenses

The 12% increase in costs and expenses during the period was the result of a 14% increase in production, programming and transmission costs —to Ps.1,761 million, from Ps.1,540 million in the same period a year ago— and a 3% increase in selling and administrative expenses —to Ps.377 million, from Ps.366 million in the same quarter of 2011.

The costs increase is mainly the result of the exhibition rights, and the production costs related to the transmission of the London 2012 Olympic Games.

The performance of sales and administrative expenses is mainly related to the growth in advisory fees, in the context of growing operations of the company.

EBITDA and net income

EBITDA was Ps.1,060 million, compared to Ps.1,217 million in the same period of last year; the EBITDA margin was 33% for this period.

The most significant change below EBITDA was a Ps.441 million decrease in the financial cost, mainly related to a foreign exchange gain for the period.

Net income for the quarter grew 89%, to Ps.718 million, from Ps.380 million last year.

Debt

As of September 30, 2012, Azteca's outstanding debt —excluding Ps.1,539 million debt due in 2069—was Ps.9,010 million.  

The cash balance of the company was Ps.6,896 million, compared to Ps.7,181 million a year ago. As a result, net debt was Ps.2,114 million, 15% below the Ps.2,500 million from the prior year.  Debt to last twelve months (LTM) EBITDA ratio was 1.9 times, and net debt to LTM EBITDA was 0.5 times.

Nine months results

Net sales in the first nine months of the year were Ps.8,943 million, 7% above Ps.8,325 million in the same period of 2011. Total costs and expenses were Ps.6,068 million, from Ps.5,431 million for the third quarter last year. The increase in costs results from the exhibition rights and production costs related to the London 2012 Olympic Games, as well as the production of competitive content that drove advertising demand.

Azteca reported EBITDA of Ps.2,875 million, compared to Ps.2,894 million from the prior year; the EBITDA margin for the nine month period was 32%. The company recorded net income of Ps.1,196 million, 28% above the Ps.936 million for the same period of the previous year.





9M2011

9M2012

Change







Ps.

%











Net sales

$8,325

$8,943

$618

7%











EBITDA

$2,894

$2,875

$(19)

-1%











Net income    

$936

$1,196

$260

28%











Net income per CPO

$0.31

$0.40

$0.09

28%











Figures in millions of pesos.
EBITDA: Earnings Before Interest, Taxes, Depreciation and Amortization.
The number of CPOs outstanding as of September 30, 2011  was 2,895 million and as of September 30, 2012 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 a 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.

Investor Relations:

Bruno Rangel
+ 52 (55) 1720 9167
jrangelk@tvazteca.com.mx



Carlos Casillas
+52 (55) 17 20 91 67
cjcasillas@tvazteca.com.mx







Press Relations:

Jaime Ramos
+52 (55) 17 20 14 16
jramosr@tvazteca.com.mx



Daniel McCosh
+52 (55) 17 20 00 59
dmccosh@tvazteca.com.mx







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

CONSOLIDATED RESULTS OF OPERATIONS

(Millions of Mexican pesos of September 30 of  2011 and  2012 )











































Third Quarter of :









2011



2012

















Change





















Net revenue

Ps

3,122

100%

Ps

3,198

100%

Ps

76

2%





















Programming, production and transmission costs



1,540

49%



1,761

55%



221

14%

Selling and administrative expenses



366

12%



377

12%



11

3%

Total costs and expenses



1,906

61%



2,138

67%



233

12%





















EBITDA



1,217

39%



1,060

33%



(157)

-13%





















Depreciation and amortization



119





143





24



Other expense -Net



142





57





(84)























Operating profit



956

31%



860

27%



(97)

-10%





















Equity in income from affiliates



3





6





3























Comprehensive financing result:



















Interest expense



(233)





(244)





(11)



Other financing expense



(28)





(16)





12



Interest income



37





51





15



Exchange loss  -Net



(233)





193





425







(457)





(17)





441























Income before the following provision



502

16%



849

27%



347

69%





















Provision for income tax



(123)





(136)





(14)























Net income

Ps

380



Ps

713



Ps

333























Non-controlling share in net profit

Ps

(0)



Ps

(5)



Ps

(5)























Controlling share in net profit  

Ps

380

12%

Ps

718

22%

Ps

338

89%





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

CONSOLIDATED RESULTS OF OPERATIONS

(Millions of Mexican pesos of September 30 of  2011 and  2012 )











































Period ended September 30,









2011



2012





















Change





















Net revenue

Ps

8,325

100%

Ps

8,943

100%

Ps

618

7%





















Programming, production and transmission costs



4,360

52%



4,966

56%



606

14%

Selling and administrative expenses



1,070

13%



1,102

12%



32

3%

Total costs and expenses



5,431

65%



6,068

68%



637

12%





















EBITDA



2,894

35%



2,875

32%



(19)

-1%





















Depreciation and amortization



368





413





44



Other expense -Net



247





208





(38)























Operating profit



2,279

27%



2,254

25%



(25)

-1%





















Equity in income from affiliates



1





7





6























Comprehensive financing result:



















Interest expense



(640)





(733)





(94)



Other financing expense



(77)





(139)





(61)



Interest income



110





172





61



Exchange Gain  -Net



(221)





184





405







(828)





(516)





311























Income before the following provision



1,453

17%



1,745

20%



292

20%





















Provision for income tax



(517)





(561)





(44)























Net income

Ps

936



Ps

1,184



Ps

248























Non-controlling share in net profit  

Ps

0



Ps

(12)



Ps

(13)























Controlling share in net profit  

Ps

936

11%

Ps

1,196

13%

Ps

260

28%





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

CONSOLIDATED BALANCE SHEETS

(Millions of Mexican pesos of September  31 of 2011 and 2012)



































At September 31











2011



2012























Change

Current assets:



















Cash and cash equivalents

Ps

7,181



Ps

6,896



Ps

(285)



Accounts receivable



6,238





6,250





12



Other current assets



2,073





2,383





310























Total current assets



15,492





15,529





37

0%





















Exhibition rights



1,308





1,363





55



Property, plant and equipment-Net



3,318





3,577





259



Television concessions-Net



6,781





6,803





22



Other assets



943





1,303





360



Goodwill -Net



19





-





(19)



Deferred income tax asset



4,456





4,277





(179)



Total long term assets



16,825





17,323





498

3%





















Total assets

Ps

32,318



Ps

32,852



Ps

535

2%









































Current liabilities:



















Short-term debt

Ps

532



Ps

648



Ps

117



Other current liabilities



2,280





2,973





693























Total current liabilities



2,812





3,621





810

29%





















Long-term debt:



















Structured Securities Certificates



5,218





4,588





(630)



Long-term debt



3,931





3,774





(157)



Total long-term debt



9,149





8,362





(787)



Other long term liabilities:



















Advertising advances



6,227





5,800





(427)



American Tower Corporation (due 2069)



1,607





1,539





(68)



Deferred income tax asset



3,572





3,106





(466)























Total other long-term liabilities



11,406





10,445





(961)

-8%





















Total liabilities



23,366





22,428





(938)

-4%





















Total stockholders' equity



8,951





10,424





1,473

16%





















Total liabilities and equity

Ps

32,318



Ps

32,852



Ps

535

2%





SOURCE Azteca

View Comments and Join the Discussion!