Consolidated Results

Mexico City, April 28, 2016—Grupo Televisa, S.A.B. (NYSE:TV; BMV: TLEVISA CPO; “Televisa” or “the Company”), today announced results for first-quarter 2016. The results have been prepared in accordance with International Financial Reporting Standards (“IFRS”).

The following table sets forth condensed consolidated statements of income for the quarters ended March 31, 2016 and 2015, in millions of Mexican pesos:

⁽¹⁾ The operating segment income margin is calculated as a percentage of segment net sales.

Net sales increased by 9.5% to Ps.21,741.0 million in first-quarter 2016 compared with Ps.19,859.4 million in first-quarter 2015. This increase was mainly attributable to revenue growth in Sky, Cable and Content segments. Operating segment income increased by 9.4%, reaching Ps.8,358.3 million with a margin of 37.5%.

Net income attributable to stockholders of the Company decreased to Ps.600.4 million, or 58.7%, in first-quarter 2016 compared to Ps.1,453.4 million in first-quarter 2015. The net decrease of Ps.853.0 million reflected primarily (i) a Ps.1,421.6 million unfavorable change in other expense, net, reflecting mainly the absence of a one-time exceptional cash income of Ps.1,028.1 million received from Univision for the early termination of a technical assistance agreement in first-quarter 2015; (ii) a Ps.147.6 million increase in finance expense, net; (iii) a Ps.79.5 million decrease in operating income before other income or expense, net; and (iv) a Ps.31.1 million increase in net income attributable to non-controlling interests. These unfavorable variances were partially offset by (i) a Ps.485.9 million favorable change in share of income or loss of associates and joint ventures, net; and (ii) a Ps.340.9 million decrease in income taxes.

First-quarter Results by Business Segment

The following table presents first-quarter consolidated results ended March 31, 2016 and 2015, for each of our business segments. Consolidated results for first-quarter 2016 and 2015 are presented in millions of Mexican pesos.

¹ For segment reporting purposes, intersegment operations are included in each of the segment operations.

² Operating segment income is defined as operating income before depreciation and amortization, corporate expenses, and other income or expense, net.

Corporate Expenses

Corporate expense increased by Ps.133.6 million, or 32.5%, to Ps.544.2 million in first-quarter 2016, from Ps.410.6 million in first-quarter 2015. The increase reflected primarily a higher share-based compensation expense.

Share-based compensation expense in first-quarter 2016 and 2015 amounted to Ps.325.8 million and Ps.224.4 million, respectively, and was accounted for as corporate expense. Share-based compensation expense is measured at fair value at the time the equity benefits are conditionally sold to officers and employees, and is recognized over the vesting period. The increase of Ps.101.4 million reflected primarily a higher number of our CPOs conditionally sold to officers and employees in our Cable segment.

Other Income or Expense, net

Other expense, net, amounted to Ps.495.2 million in first-quarter 2016 compared with other income, net, of Ps.926.4 million in first-quarter 2015. The unfavorable change of Ps.1,421.6 million reflected primarily the absence of a cash income of US$67.6 million (Ps.1,028.1 million) from Univision, as a result of the early termination of a technical assistance agreement in first-quarter 2015, as well as an increase on the disposition of assets related to the upgrade of our infrastructure in our cable division and in expenses related to financial advisory and professional services.

Non-operating Results

Finance Expense, net

The following table sets forth the finance (expense) income, net, stated in millions of Mexican pesos for the quarters ended March 31, 2016 and 2015.

Finance expense, net, increased by Ps.147.6 million, or 7.9%, to Ps.2,008.6 million in first-quarter 2016 compared to Ps.1,861.0 million in first-quarter 2015. This increase reflected primarily (i) a Ps.505.6 million increase in interest expense, due primarily to a higher average principal amount of debt, finance lease obligations and other finance liabilities in first-quarter 2016; (ii) a Ps.271.0 million increase in other finance expense, net, resulting primarily from the absence of a favorable change in fair value of an embedded derivative in our former investment in Convertible Debentures issued by UHI recognized in first-quarter 2015, as well as an unfavorable change in fair value of our derivative contracts in first-quarter 2016; and (iii) a Ps.7.4 million decrease in interest income primarily explained by the absence of interest income from our former investment in Convertible Debentures issued by UHI, which effect was offset by an increase in interest income derived from a higher average of cash equivalents and temporary investments in first-quarter 2016. These unfavorable effects were partially offset by a Ps.636.4 million decrease in foreign exchange loss resulting primarily from the effect of a 0.3% depreciation of the Mexican peso against the U.S. dollar on our average net U.S. dollar liability position in first-quarter 2016 compared with a 3.3% depreciation and lower average net U.S. dollar liability position in first-quarter 2015.

 

Share of Income or Loss of Associates and Joint Ventures, net

Share of income of associates and joint ventures, net, amounted to Ps.186.3 million in first-quarter 2016 compared with a share of loss of associates and joint ventures of Ps.299.6 million in first-quarter 2015. The favorable change of Ps.485.9 million reflected mainly a share of income of UHI, the controlling company of Univision, in first-quarter 2016 compared with a share of loss of UHI in first-quarter 2015.

Income Taxes

Income taxes decreased by Ps.340.9 million, or 40.3%, to Ps.505.5 million in first-quarter 2016 compared with Ps.846.4 million in first-quarter 2015. This increase reflected primarily a lower income tax base.

Net Income Attributable to Non-controlling Interests

Net income attributable to non-controlling interests increased by Ps.31.1 million, or 8.9%, to Ps.380.9 million in first-quarter 2016, compared with Ps.349.8 million in first-quarter 2015. This increase reflected primarily a higher portion of net income attributable to non-controlling interests in our Sky segment, which was partially offset by a lower portion of net income attributable to non-controlling interests in our Cable segment.

Other Relevant Information

Capital Expenditures and Investments

During first-quarter 2016, we invested approximately US$330.7 million in property, plant and equipment as capital expenditures, including approximately US$209.0 million for our Cable segment, US$87.8 million for our Sky segment, and US$33.9 million for our Content and Other Businesses segments.

In March 2016, we announced the acquisition of the remaining 50% equity interest of Televisión Internacional, S.A. de C.V. or “TVI” in the aggregate amount of Ps.6,750 million, including the assumption of long term liabilities in the aggregate amount of Ps.4,750 million with maturities between 2017 and 2020, and a cash payment of Ps.2,000 million. Until such acquisition is completed in the second half of 2016, a third party will participate as a non-controlling shareholder of Corporativo Vasco de Quiroga, S.A. de C.V. or “CVQ”, a direct subsidiary of us. This transaction also provides for the acquisition of the non-controlling interest in CVQ in the amount of Ps.1,258 million, which is included in the total amount of the transaction. This transaction complies with the guidelines and timetable established in the authorization by the Mexican Federal Institute of Telecommunications. With the ownership of the 100% of the equity interest of TVI, we will be better positioned to exploit efficiencies and economies of scale among all our cable operations throughout Mexico and to continue expanding our offer of video, voice and data services.

 

Debt, Finance Lease Obligations and Other Finance Liabilities

The following table sets forth our total consolidated debt, finance lease obligations and other finance liabilities as of March 31, 2016 and December 31, 2015. Amounts are stated in millions of Mexican pesos.

¹ As of March 31, 2016 and December 31, 2015, total debt is presented net of finance costs in the amount of Ps.1,362.4 million and Ps.1,387.9 million, respectively, and does not include related accrued interest payable in the amount of Ps.1,787.6 million and Ps.1,184.2 million, respectively.

² In connection with the acquisition of a non-controlling interest in TVI, as discussed above.

As of March 31, 2016, our consolidated net debt position (total debt, as stated in the table above, less cash and cash equivalents, temporary investments, and non-current held-to-maturity and available-for-sale investments) was Ps.47,218.2 million. The aggregate amount of noncurrent held-to-maturity and available-for-sale investments as of March 31, 2016, amounted to Ps.6,278.2 million.

In March 2016, our Sky segment entered into long-term debt agreements with two Mexican banks in the aggregate principal amount of Ps.5,500 million with maturities between 2021 and 2023, and prepaid an intercompany long-term loan in the principal amount of Ps.3,500 million. Also, we prepaid a portion of our Mexican peso outstanding long-term loans with original maturities between 2016 and 2017 in the aggregate principal amount of Ps.3,532 million.

Shares Outstanding

As of March 31, 2016 and December 31, 2015, our shares outstanding amounted to 338,216.0 million and 338,468.3 million shares, respectively, and our CPO equivalents outstanding amounted to 2,890.7 million and 2,892.9 million CPO equivalents, respectively. Not all of our shares are in the form of CPOs. The number of CPO equivalents is calculated by dividing the number of shares outstanding by 117.

As of March 31, 2016 and December 31, 2015, the GDS (Global Depositary Shares) equivalents outstanding amounted to 578.1 million and 578.6 million GDS equivalents, respectively. The number of GDS equivalents is calculated by dividing the number of CPO equivalents by five.

About Televisa

Televisa is a leading media company in the Spanish-speaking world, an important cable operator in Mexico and an operator of a leading direct-to-home satellite pay television system in Mexico. Televisa distributes the content it produces through several broadcast channels in Mexico and in over 50 countries through 26 pay-tv brands, and television networks, cable operators and over-the-top or “OTT” services. In the United States, Televisa's audiovisual content is distributed through Univision Communications Inc. ("Univision") the leading media company serving the Hispanic market. Univision broadcasts Televisa's audiovisual content through multiple platforms in exchange for a royalty payment. In addition, Televisa has equity and warrants which upon their exercise and subject to any necessary approval from the Federal Communications Commission of the United States would represent approximately 36% on a fully-diluted, as-converted basis of the equity capital in Univision Holdings Inc., the controlling company of Univision. Televisa’s cable business offers integrated services, including video, high-speed data and voice services to residential and commercial customers as well as managed services to domestic and international carriers through five cable Multiple System Operators in Mexico. Televisa owns a majority interest in Sky, a leading direct-to-home satellite pay television system in Mexico, operating also in the Dominican Republic and Central America. Televisa also has interests in magazine publishing and distribution, radio production and broadcasting, professional sports and live entertainment, feature-film production and distribution, and gaming.

Disclaimer

This press release contains forward-looking statements regarding the Company’s results and prospects. Actual results could differ materially from these statements. The forward-looking statements in this press release should be read in conjunction with the factors described in “Item 3. Key Information – Forward-Looking Statements” in the Company’s Annual Report on Form 20-F, which, among others, could cause actual results to differ materially from those contained in forward-looking statements made in this press release and in oral statements made by authorized officers of the Company. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

(Please see attached tables for financial information data)

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GRUPO TELEVISA, S.A.B.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

AS OF MARCH 31, 2016 AND DECEMBER 31, 2015

(Millions of Mexican Pesos)

 

 

ASSETS		March 31, 2016 (Unaudited)				December 31, 2015 (Unaudited)
Current assets:
Cash and cash equivalents		Ps.	53,565.2			Ps.	49,397.1
Temporary investments			5,820.8				5,330.5
Trade notes and accounts receivable, net			16,458.7				21,702.1
Other accounts and notes receivable, net			4,378.7				4,296.1
Due from related parties			135.9				98.4
Transmission rights and programming			7,274.8				5,389.1
Inventories			1,779.6				1,628.3
Other current assets			2,603.1				2,096.5
Total current assets			92,016.8				89,938.1
Non-current assets:
Transmission rights and programming			9,127.3				9,139.1
Investments in financial instruments			41,284.0				41,081.4
Investments in associates and joint ventures			9,614.0				9,271.9
Property, plant and equipment, net			78,390.3				76,089.3
Intangible assets, net			37,750.6				38,106.3
Deferred income tax assets			18,764.1				17,665.1
Other assets			174.3				182.5
Total non-current assets			195,104.6				191,535.6
Total assets		Ps.	287,121.4			Ps.	281,473.7

 

 

 

LIABILITIES		March 31, 2016 (Unaudited)				December 31, 2015 (Unaudited)
Current liabilities:
Current portion of long-term debt and interest payable		Ps.	1,861.9			Ps.	4,164.0
Current portion of finance lease obligations			523.1				511.6
Derivative financial instruments			-				1.4
Trade accounts payable and accrued expenses			22,826.1				17,361.5
Customer deposits and advances			18,602.3				20,470.4
Income taxes payable			1,492.4				1,632.8
Other taxes payable			1,080.4				1,246.0
Employee benefits			755.1				1,034.5
Due to related parties			554.6				443.0
Other current liabilities			2,786.3				2,112.8
Total current liabilities			50,482.2				48,978.0
Non-current liabilities:
Long-term debt, net of current portion			112,808.1				107,430.8
Finance lease obligations, net of current portion			5,224.7				5,293.6
Other finance liabilities			3,500.7				-
Derivative financial instruments			260.7				225.7
Customer deposits and advances			290.0				514.5
Income taxes payable			5,545.1				6,338.1
Deferred income tax liabilities			9,660.2				10,000.0
Post-employment benefits			443.5				407.2
Other long-term liabilities			3,173.8				2,764.1
Total non-current liabilities			140,906.8				132,974.0
Total liabilities			191,389.0				181,952.0
EQUITY
Capital stock			4,978.1				4,978.1
Additional paid-in-capital			15,889.8				15,889.8
			20,867.9				20,867.9
Retained earnings:
Legal reserve			2,139.0				2,139.0
Unappropriated earnings			66,598.7				60,101.5
Net income for the period			600.4				10,899.1
			69,338.1				73,139.6
Accumulated other comprehensive income, net			5,348.3				5,257.6
Shares repurchased			(11,882.2	)			(11,882.2	)
			62,804.2				66,515.0
Equity attributable to stockholders of the Company			83,672.1				87,382.9
Non-controlling interests			12,060.3				12,138.8
Total equity			95,732.4				99,521.7
Total liabilities and equity		Ps.	287,121.4			Ps.	281,473.7

 

 

 

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE THREE MONTHS ENDED MARCH 31, 2016 AND 2015

(Millions of Mexican Pesos)