TV Azteca Announces 10% EBITDA Growth to Historical Maximum of Ps.1,101 Million, in 3Q10

—Solid performance of Net Sales, 17% growth, to Ps.2,806 million—

—Azteca America's net income of Ps.220 million, 12% above of last year—

—Net income grows 16% to Ps.416 million—

Oct 28, 2010, 17:02 ET from TV Azteca, S.A.B. de C.V.

MEXICO CITY, Oct. 28 /PRNewswire-FirstCall/ -- TV Azteca, S.A.B. de C.V. (BMV: TVAZTCA; Latibex: XTZA), one of the two largest producers of Spanish-language television programming in the world, announced today financial results for the third quarter of 2010.

"Our programming grids generated high levels of commercial audience throughout the day, and a growing interest of many advertisers in positioning their brands in our content in Mexico and the United States; resulting in a remarkable performance in net sales. The income grow was crucial in the strong growing of the EBITDA, reaching a historical maximum for a third quarter, as well as in the extra strengthening of the net profit", commented TV Azteca's CEO, Mario San Roman.

Third quarter results

Net sales were Ps.2,806 million, 17% above the 2,400 million of the same quarter of 2009.  Total costs and expenses were Ps.1,705 million, compared to Ps.1,398 million in the same period of the previous year.  

As a result, TV Azteca reported EBITDA of Ps.1,101 million, 10% above the Ps.1,002 million in the third quarter of 2009.  The EBITDA margin was 39%. The company registered net income of Ps.416 million, 16% higher than the Ps.358 million from the previous year.



3Q 2009

3Q 2010

Change




Ps.

%






Net sales

$2,400

$2,806

$406

17%






EBITDA    

$1,002

$1,101

$98

10%






Net income    

$358

$416

$58

16%






Net income per CPO

$0.12

$0.14

$0.02

12%






Figures in millions of pesos.

EBITDA: Operating Profit Before Depreciation and Amortization.

The number of CPOs outstanding as of September 30 2009 was 2,905 million and as of September 30,2010 was 3,000 million.



Net sales

"We reached 40% commercial audience throughout the complete day in Mexico during the quarter, with programming that reached the target market of our advertisers, which pushed our sales even more", added Mario San Roman. "The solid income was complemented this period by the marketing of the final phase of the Soccer World Cup of South Africa, and a dynamic grow of Azteca America's sales."  

Third quarter revenue includes sales at Azteca America—the company's wholly-owned broadcast television network focused on the U.S. Hispanic market—of Ps.220 million, 12% higher than the Ps.197 million a year ago.

Revenue from barter sales was Ps.82 million in the period, from Ps.63 million in the previous year.

Costs and expenses

The 22% growth in costs and expenses resulted from a 24% increase in production, programming and transmission costs —to Ps.1,406 million, from Ps.1,130 million in the same period a year ago— and from a 12% increase in selling and administrative expenses —to Ps.299 million, from Ps.268 million in the same quarter of 2009.

The growth in costs mainly derives from the World Cup exhibition rights, as well as associated costs of the event's production and broadcast in its final phase, and production of programming related to Mexico's Independence Bicentennial.

The selling and administrative expenses results are due to higher fee payments and personnel expenses.

EBITDA and net income

EBITDA was Ps.1,101 million, 10% above the Ps.1,002 million in the same period of the prior year.

The main changes below EBITDA were i) a Ps.61 million increase in other expenses, as well as ii) a Ps.30 million reduction in integrated financing cost, mainly derived from an improved exchange result and higher interest earnings in the period.

Net income for the period was Ps.416 million, 16% higher than the Ps.358 million from a year ago.

Debt

As of September 30, 2010, TV Azteca's outstanding debt —excluding Ps.1,497 million debt due in 2069—was Ps.7,817 million, compared to Ps.7,147 million a year ago.  

The debt is peso denominated —congruent with most of the company income—and Ps.6,000 million is comprised of long-term Securities Certificates with a fixed annual interest rate of 9.29%, with interest coverage for the next three years.

The cash balance of the company was Ps.3,341 million, 31% higher than Ps.2,558 million a year ago.

Net debt was Ps.4,476 million, compared to Ps.4,589 million from the previous year.  Debt to last twelve months (LTM) EBITDA ratio was 1.7 times, and net debt to LTM EBITDA was 1 time.

Nine months results

Net sales in the first nine months of the year were Ps.7,887 million, 15% superior from the Ps.6,871 million of the same period of 2009. Total costs and expenses were Ps.4,979 million, from Ps.4,319 million in the same period a year ago, mainly derived from costs related to the World Cup transmission this year. As a result, TV Azteca recorded EBITDA of Ps.2,907 million, 14% higher than the Ps.2,552 million in the first nine months of the prior year.  The EBITDA margin for the period was 37%, without changes compared to last year. The company recorded net income of Ps.929 million, compared to Ps.452 million in the same period of 2009.



9M 2009

9M 2010

Change




Ps.

%






Net sales

$6,871

$7,887

$1,016

15%






EBITDA    

$2,552

$2,907

$355

14%






Net income    

$452

$929

$477

106%






Net income per CPO

$0.16

$0.31

$0.15

99%






Figures in millions of pesos.

EBITDA: Operating Profit Before Depreciation and Amortization.

The number of CPOs outstanding as of September 30, 2009 was 2,905 million and as of September 30, 2010 was 3,000 million.




Company Profile

TV 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.  TV Azteca affiliates include Azteca America Network, a new broadcast television network focused on the rapidly growing U.S. Hispanic market, and Azteca Web, an Internet company for Spanish speakers.

TV 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: TV Azteca (www.irtvazteca.com), Azteca America (www.aztecaamerica.com), Grupo Elektra (www.grupoelektra.com.mx), Banco Azteca (www.bancoazteca.com.mx), 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 TV Azteca and its subsidiaries are identified in documents sent to securities authorities.

Investor Relations:

Bruno Rangel


Carlos Casillas

+ 52 (55) 1720 9167


+ 52 (55) 1720 0041

jrangelk@tvazteca.com.mx


cjcasillas@tvazteca.com.mx




Press Relations:

Tristan Canales


Daniel McCosh

+ 52 (55) 1720 1441


+ 52 (55) 1720 0059

tcanales@gruposalinas.com.mx


dmccosh@tvazteca.com.mx




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

CONSOLIDATED RESULTS OF OPERATIONS

(Millions of Mexican pesos of September 30 of  2009 and  2010 )






















Third Quarter  of :





2009


2010











Change











Net revenue

Ps

2,400

100%

Ps

2,806

100%

Ps

406

17%











Programming, production and transmission costs


1,130

47%


1,406

50%


276

24%

Selling and administrative expenses


268

11%


299

11%


32

12%

Total costs and expenses


1,398

58%


1,705

61%


308

22%











EBITDA


1,002

42%


1,101

39%


98

10%











Depreciation and amortization


127



133



5












Operating profit


875

36%


968

34%


93

11%











Other expense -Net


(172)



(233)



(61)












Comprehensive financing result:










Interest expense


(208)



(216)



(8)


Other financing expense


(22)



(17)



5


Interest income


12



21



9


Exchange (loss ) gain  -Net


(20)



4



24




(238)



(208)



30












Income before the following provision


465

19%


527

19%


61

13%











Provision for income tax


(107)



(110)



(3)












Net income

Ps

358


Ps

416


Ps

58












Non-controlling share in net profit

Ps

0


Ps

0


Ps

(0)












Controlling share in net profit  

Ps

358

15%

Ps

416

15%

Ps

58

16%



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

CONSOLIDATED RESULTS OF OPERATIONS

(Millions of Mexican pesos of September 30 of 2009 and 2010 )


Period ended September 30,





2009


2010











Change











Net revenue

Ps

6,871

100%

Ps

7,887

100%

Ps

1,016

15%











Programming, production and transmission costs


3,527

51%


4,115

52%


588

17%

Selling and administrative expenses


791

12%


864

11%


73

9%

Total costs and expenses


4,319

63%


4,979

63%


661

15%











EBITDA


2,552

37%


2,907

37%


355

14%











Depreciation and amortization


380



394



14












Operating profit


2,172

32%


2,514

32%


341

16%











Other expense -Net


(530)



(493)



37












Comprehensive financing result:










Interest expense


(665)



(639)



26


Other financing expense


(52)



(62)



(10)


Interest income


49



75



26


Exchange (loss) Gain  -Net


(68)



5



74




(736)



(620)



116












Income before the following provision


906

13%


1,400

18%


494

55%











Provision for income tax


(454)



(471)



(18)












Net income

Ps

452


Ps

929


Ps

477












Non-controlling share in net profit  

Ps

1


Ps

1


Ps

0












Controlling share in net profit  

Ps

451

7%

Ps

928

12%

Ps

477

106%



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

CONSOLIDATED BALANCE SHEETS

(Millions of Mexican pesos of September  30 of 2009 and 2010 )








At September 30






2009


2010












Change

Current assets:










Cash and cash equivalents

Ps

2,558


Ps

3,341


Ps

783


Accounts receivable


3,711



4,120



409


Other current assets


2,070



2,272



202












Total current assets


8,339



9,733



1,394

17%











Long-term accounts receivable from Pappas


2,080



1,510



(570)


Exhibition rights


469



913



444


Property, plant and equipment-Net


3,082



3,126



44


Television concessions-Net


4,649



4,648



(1)


Other assets


1,621



1,801



180


Goodwill -Net


159



-



(159)


Deferred income tax asset


254



4,253



3,999


Total long term assets


12,314



16,251



3,937

32%











Total assets

Ps

20,653


Ps

25,984


Ps

5,331

26%





















Current liabilities:










Short-term debt

Ps

1,147


Ps

1,680


Ps

533


Other current liabilities


2,753



2,573



(180)












Total current liabilities


3,900



4,253



353

9%











Long-term debt:










Structured Securities Certificates


6,000



6,000



-


Long-term debt


-



137



137


Total long-term debt


6,000



6,137



137


Other long term liabilities:










Advertising advances


3,724



4,039



315


American Tower Corporation (due 2069)


1,617



1,497



(120)


Deferred income tax asset


-



3,378



3,378












Total other long-term liabilities


5,341



8,914



3,573

67%











Total liabilities


15,241



19,304



4,063

27%











Total stockholders' equity


5,412



6,680



1,268

23%











Total liabilities and equity

Ps

20,653


Ps

25,984


Ps

5,331

26%













SOURCE TV Azteca, S.A.B. de C.V.



RELATED LINKS

http://www.irtvazteca.com