31
RESULTS COMMENTARY FOR THE SIX MONTHS ENDED 31 DECEMBER 2011
RESULTS COMMENTARY
FOR THE SIX MONTHS ENDED 31 DECEMBER 2011
VRL GROUPDISCLAIMER
N IFRS Fi i l I f tiNon – IFRS Financial InformationThe VRL group results are prepared under Australian Accounting Standards, and also comply with International Financial Reporting Standards (“IFRS”). This presentation includes certain non-IFRS i l di EBITDA d ti fit l di t i l it f i dIFRS measures including EBITDA and operating profit excluding material items of income and expense and discontinued operations. These measures are used internally by management to assess the performance of the business, make decisions on the allocation of resources and assess operational performance. Non-IFRS measures have not been subject to audit or review, h ll it d t l l t th IFRS h b d i d fhowever all items used to calculate these non-IFRS measures have been derived from information used in the preparation of the audited or audit-reviewed (as applicable) financial statements.
I l d d i th H lf Y Fi i l R t ( 4) i R ili ti f R lt hi h idIncluded in the Half Year Financial Report (page 4) is a Reconciliation of Results which provides further detail on the Non-IFRS financial information contained in this presentation.
Results commentary for the six months ended • 31 December 20112
VRL GROUPRESULTS
• EBITDA from operations of $79 4 million up 9%• EBITDA from operations of $79.4 million up 9%
• Net Profit After Tax (continuing) of $28.3 million up 52%
• Attributable Net Profit After Tax of $28.3 million, prior year$33.7 million (including $15.2 million discontinued)
• Net cashflows from operating activities of $62.1 million
• Net on balance sheet debt of $267.0 million
Refer to reconciliation of results on page 4 of the Half Year Financial Report for details of the basis of calculation of these measures
Results commentary for the six months ended • 31 December 20113
VRL GROUPRESULTS BY DIVISIONRESULTS BY DIVISIONFor the 6 months ended
Operating Results Reported EBIT Reported EBITDA
31 Dec 2011$’m
31 Dec 2010$’m
31 Dec 2011$’m
31 Dec2010$’m
31 Dec2011$’m
31 Dec2010$’m
THEME PARKS GOLD COAST 11 7 14 6 23 4 23 6 37 1 37 6THEME PARKS : GOLD COAST 11.7 14.6 23.4 23.6 37.1 37.6
THEME PARKS : US WATER PARKS 0.2 (0.7) 1.8 0.8 3.3 2.5
CINEMA EXHIBITION : AUST 12.6 11.7 14.8 14.7 20.8 20.2
CINEMA EXHIBITION : OTHER 1.6 1.3 1.5 1.3 1.8 1.6
FILM DISTRIBUTION 26.2 24.4 29.8 28.9 31.1 32.3
CORPORATE/OTHER (10.2) (28.2) (15.8) (22.5) (14.7) (21.2)
REPORTED RESULTS 42.1 23.1 55.5 46.8 79.4 73.0
Results commentary for the six months ended • 31 December 20114
VRL GROUPOPERATING CASHFLOWOPERATING CASHFLOWFor the 6 months ended 31 December 2011
M tEBITDA
$’m
Movement in Working
Capital$’m
Interest/Tax$’m
Operating Cash Flow
$’m
Capital Expenditure
$’m
Free Cash Flow
$’m
THEME PARKS 40.4 8.7 (12.5) 36.6 (22.0) 14.6
CINEMA EXHIBITION 22.6 10.5 (2.1) 31.0 (4.0) 27.0( ) ( )
FILM DISTRIBUTION 31.1 (18.0) (3.7) 9.4 (0.8) 8.6
CORPORATE/OTHER (14.7) (8.6) 8.4 (14.9) (3.8) (18.7)
TOTAL 79.4 (7.4) (9.9) 62.1 (30.6) 31.5
Results commentary for the six months ended • 31 December 20115
VRL GROUPVRL GROUP DEBT
ON BALANCE SHEET Facility Expiry Calendar Year
Total Debt Drawn ($m)
31 Dec 2011
Total Debt Drawn ($m)
30 Jun 2011
THEME PARKS : GOLD COAST 2nd half 2014 263.6 273.9
THEME PARKS : US WATER PARKS 1st half 2029/1st half 2015 36.9 36.1
CINEMA EXHIBTION : AUST 2nd half 2012 59.6 66.2
FILM DISTRIBUTION 1st half 2013 101.6 108.8
CORPORATE / OTHER (note 1) 1st half 2015 0.1 0.2
TOTAL ON BALANCE SHEET DEBT 461.8 485.2
Cash on Hand (note 2) (194.8) (431.7)
NET DEBT ON BALANCE SHEET 267.0 53.5NET DEBT ON BALANCE SHEET 267.0 53.5Note 1: VRL has completed its negotiation on the reinstatement of a 3 year $100m corporate debt facility. This facility is currently undrawn. Note 2: Major cash outflow for six months includes $151.5m shareholder distribution, $12.1m final dividend and $62.1m tax payment resulting from the sale of Austereo
Results commentary for the six months ended • 31 December 20116
VRL GROUPVRL GROUP DEBT
ON BALANCE SHEET DEBT – CURRENT 31 December 2011($m) ($m)
THEME PARKS 23.3
FILM DISTRIBUTION 14.4
CINEMA EXHIBTION : AUST (note 1) 59.4( ) 59.4
CORPORATE/OTHER -
Total Current Debt on Balance Sheet 97.1
31 D b 2011ON BALANCE SHEET DEBT – NON CURRENT 31 December 2011($m)
THEME PARKS 277.3
FILM DISTRIBUTION 87.2
CINEMA EXHIBTION : AUST 0.1
CORPORATE/OTHER 0.1
Total Non Current Debt on Balance Sheet 364.7
Note 1: This facility is currently being re-negotiated and is expected to be completed by June 2012
Results commentary for the six months ended • 31 December 20117
THEME PARKS
8Results commentary for the six months ended • 31 December 2011
THEME PARKSSUMMARY OF RESULTS
EBITDA NPBT
• EBITDA is up on the prior year
EBITDA NPBT
RESULTS ANALYSISFor the 6 months ended
31 December 2011 ($m)
31 December 2010($m)
31 December 2011($m)
31 December 2010($m)($m) ($m) ($m) ($m)
Gold Coast Theme Parks 37.1 37.6 11.7 14.6
USA Water Parks 3.3 2.5 0.2 (0.7)
TOTAL 40.4 40.1 11.9 13.9
Results commentary for the six months ended • 31 December 20119
THEME PARKSGOLD COAST
RESULTS ANALYSIS 31 December 2011 31 December 2010RESULTS ANALYSISFor the 6 months ended
31 December 2011($m)
31 December 2010($m)
TOTAL ATTENDANCE (m) 2.3 2.4
SALES REVENUE 131 0 132 0SALES REVENUE 131.0 132.0
OTHER REVENUE 0.1 0.3
TOTAL EXPENSES 94.0 94.7
EBITDA 37.1 37.6
DEPRECIATION AND AMORTISATION 13.7 14.0
INTEREST (NET) 11.7 9.0INTEREST (NET) 11.7 9.0
NET PROFIT BEFORE TAX 11.7 14.6
TOTAL CAPEX 21.8 25.6
Results commentary for the six months ended • 31 December 201110
THEME PARKSGOLD COAST
• Multi-Day, Multi-Park ticket sales, drive up yields 6%y p y
• Weather patterns have impacted attendances, cool summer, untimely rainfall periods – attendance 5%p
• High Australian dollar is a disincentive to both international and domestic visitors to the Gold Coast
• In park spend, increased revenue 2%
• Disciplined cost control, maintain EBITDA
• 4 days heavy rain latter part of January holidays - despite that EBITDA y y p y y pfor January is up 6.5% on last year.
Results commentary for the six months ended • 31 December 201111
THEME PARKS GOLD COAST
New Attractions • Successfully bedded down new attractions that will generate
attendances over many years• Green Lantern CoasterGreen Lantern Coaster
at Warner Bros. Movie World
• Nickelodeon ParadeNickelodeon Parade at Sea World
• ‘Spirit Of The Horse’Spirit Of The Horse at Australian Outback Spectacular
• Nickelodeon Spray Groundc e odeo Sp ay G ou dat Sea World Resort & Water Park
Results commentary for the six months ended • 31 December 201112
THEME PARKSGOLD COAST
• New events opens up incremental evening revenues• New events opens up incremental evening revenues
• White Christmas• Halloween
• Both events will be used as a promotional device toBoth events will be used as a promotional device to upgrade the consumer purchase to a higher yielding ticket and drive theme park ticket sales
Results commentary for the six months ended • 31 December 201113
THEME PARKSNEW OPPORTUNITIES
Wet’n’Wild SydneyWet n Wild Sydney• World class water park located 35min Sydney CBD• Development approval obtainede e op e t app o a obta ed• Targeted opening date late 2013• Village Roadshow will present the latest and best in
attractions to create a world’s best standard park that will be Sydney’s theme park that just happens to be themed by water
• Expected capital budget $100m - $120mExpected capital budget $100m $120m
Chinese Theme parksC ese e e pa s• Negotiations continuing
14Results commentary for the six months ended • 31 December 2011
THEME PARKSUSA WATER PARKS
RESULTS ANALYSIS 31 December 2011
31 December 2010RESULTS ANALYSIS
For the 6 months ended 2011($m)
2010($m)
TOTAL ATTENDANCE (m) 0.4 0.4
SALES REVENUE 10 2 11 0SALES REVENUE 10.2 11.0
OTHER REVENUE - -
TOTAL EXPENSES 6.9 8.5
EBITDA 3.3 2.5
DEPRECIATION AND AMORTISATION 1.6 1.7
INTEREST (NET) 1.5 1.5INTEREST (NET) 1.5 1.5
NET PROFIT BEFORE TAX 0.2 (0.7)
TOTAL CAPEX 0.2 0.5
Results commentary for the six months ended • 31 December 201115
THEME PARKSUSA WATER PARKS
Wet’n’Wild Phoenix• Strong season pass sales• World premiere new Constrictor water slide• New kids attraction to open in 2012 season to
b d d hi lbroaden demographic appeal
Wet’n’Wild Hawaii
• Economic pressures impacting on results• Some evidence of tourism recoverySome evidence of tourism recovery
16Results commentary for the six months ended • 31 December 2011
CINEMA EXHIBITION
17Results commentary for the six months ended • 31 December 2011
CINEMA EXHIBITIONCINEMA EXHIBITION
RESULTS ANALYSIS 31 December 2011
31 December 2010For the 6 months ended 2011
($m)2010($m)
TOTAL PAID ADMISSIONS AUSTRALIA (m) 12.2 12.6
SALES REVENUE 110.9 110.8
OTHER REVENUE 8.8 6.9
TOTAL EXPENSES 98.9 97.5
EBITDA 20 8 20 2EBITDA 20.8 20.2
EBITDA – EXHIBITION OTHER (note 1) 1.8 1.6
EBITDA 22.6 21.8
DEPRECIATION AND AMORTISATION 6 3 5 8DEPRECIATION AND AMORTISATION 6.3 5.8
INTEREST (NET) 2.1 3.0
NET PROFIT BEFORE TAX 14.2 13.0
TOTAL CAPEX 4.0 8.1
Note 1: Exhibition other includes the overseas exhibition territories (USA, Singapore and UK) and the Intencity games business.
Results commentary for the six months ended • 31 December 201118
CINEMA EXHIBITIONAUSTRALIA
• Business is driving higher yields from unique offerings;Business is driving higher yields from unique offerings; Gold Class, 3D, $max
• Increased spend per patron – improved food offeringsIncreased spend per patron improved food offerings
• Upcoming strong titles:
• Hunger Games• Dark Knight Rises• Men In Black III
Results commentary for the six months ended • 31 December 201119
CINEMA EXHIBITIONAUSTRALIA
• Continued digital projector rolloutContinued digital projector rollout• 361 digital projectors rolled out to sites as at December• Additional 145 projectors to be rolled out to sites by end p j y
of August 2012• Strong alternative content screened in the last six months,
the beginning of future new diversity to earnings• Phantom Of The Opera
P l J• Pearl Jam
Results commentary for the six months ended • 31 December 201120
CINEMA EXHIBITIONOTHERUS Gold Class
• Refurbishment program complete
• New site opening May 2012
• Trading results improving
• Energy from local management and partnerEnergy from local management and partner
Singapore• Strong trading – driven by local product• Strong trading – driven by local product
• Admissions up on last year
B lf tBelfast
• Loss making in very competitive sectorResults commentary for the six months ended • 31 December 2011
21
FILM DISTRIBUTION
22Results commentary for the six months ended • 31 December 2011
FILM DISTRIBUTIONFILM DISTRIBUTION
RESULTS ANALYSIS 31 December 2011
31 December 2010RESULTS ANALYSIS
For the 6 months ended 2011($m)
2010($m)
SALES REVENUE 212.7 228.5
OTHER REVENUE 0 7 0 9OTHER REVENUE 0.7 0.9
TOTAL EXPENSES 182.3 197.1
EBITDA 31.1 32.3
DEPRECIATION AND AMORTISATION 1.3 3.4
INTEREST (NET) 3.6 4.5
NET PROFIT BEFORE TAX 26 2 24 4NET PROFIT BEFORE TAX 26.2 24.4
Results commentary for the six months ended • 31 December 201123
FILM DISTRIBUTIONFILM DISTRIBUTION• Leading theatrical distributor with market share of 22.2%
• Red Dog outstanding performance 8th highest grossing• Red Dog, outstanding performance, 8th highest grossing Australian title of all time, Box Office $21.4 million, 3rd
biggest DVD of all time
• Solid line-up during the period:
• Harry Potter And The Deathly Hallows Part 2y y• Horrible Bosses• Crazy Stupid Love• New Years Eve
• Television continues to perform generating strong libraryTelevision continues to perform generating strong library revenues
Results commentary for the six months ended • 31 December 201124
FILM DISTRIBUTIONOUTLOOK
• Sherlock Holmes 2 – Number one summer film in competitive market
• Hunger Games – The next big trilogy g g gy
• Australian titles – Kath & Kim, Goddess and Baz Luhrmann’s The Great GatsbyLuhrmann s The Great Gatsby
Results commentary for the six months ended • 31 December 201125
FILM PRODUCTION &FILM PRODUCTION & MUSIC
Results commentary for the six months ended • 31 December 2011 26
FILM PRODUCTION & MUSICFILM PRODUCTION & MUSIC
• “Portfolio Business” – overall strength and gperformance of product has been healthy
Actively engaged in raising funding exploring• Actively engaged in raising funding, exploring international IPO
• Tremendous results – Sherlock Holmes 2, more than US$500 million world wide box office to date
• Happy Feet 2 3D – released pre Christmas with world wide gross box office of approx US$155 millionworld wide gross box office of approx US$155 million - below expectations
Results commentary for the six months ended • 31 December 201127
FILM PRODUCTION & MUSICFILM PRODUCTION & MUSIC
• Continuation of a powerful line up of upcoming titles, further building the portfolio of exciting titles:
• Lucky One – from Nicholas Sparks’ book, uc y O e o c o as Spa s boo ,starring Zac Effron
• Dark Shadows – Directed by Tim Burton, starring y gJohnny Depp
• Gangster Squad – Ryan Gosling & Sean Penn• The Great Gatsby 3D – Directed by Baz
Luhrmann, starring Leonardo De Caprio
Results commentary for the six months ended • 31 December 201128
FILM PRODUCTION & MUSICFILM PRODUCTION & MUSIC
• Portfolio of Chinese Films
• Man Of Tai Chi – Directed and starring Keanu Reevesg
• My Lucky Star – Produced and starring Zhang Ziyi
• Journey To The West – Directed by Stephen Chow
Results commentary for the six months ended • 31 December 201129
VRL GROUPSUMMARYStable underlying businesses
• Stable earnings and strong cashflows
• Low net debt and significant cash reservesg
• Corporate cost reductions realised
Dynamic Growth StrategyDynamic Growth Strategy
• Wet’n’Wild Sydney
• China theme park opportunities• China theme park opportunities
• Embrace the digital revolution
Chi fil tf li• Chinese film portfolio
Results commentary for the six months ended • 31 December 201130
VRL GROUPSUMMARY
• World class parks with new attractions completed – weather – law of averagescompleted weather law of averages
• Strong line up of International and Australian films benefiting Production; Distribution and Exhibition businesses
• In the business of show business and selling tickets
Results commentary for the six months ended • 31 December 201131
