BEIJING, June 9, 2020 /PRNewswire/ -- Wanda Sports Group
Company Limited (the "Company", and together with its consolidated
entities, "Wanda Sports Group," the "Group" or "we") (NASDAQ: WSG),
a leading global sports events, media and marketing platform, today
announced its unaudited financial results for the first quarter
ended March 31, 2020.
Because the previously announced sale of The IRONMAN Group is
still pending, it is treated for purposes of the Group's results
for the first quarter of 2020 as an asset held for sale and its
historical results are reflected as discontinued
operations. Its results and operating data also have been
excluded from the comparative first quarter 2019 results and
operating data. Unless otherwise indicated, the financial
statement line items and non-IFRS financial measures are presented
on a continuing operations basis.
First Quarter 2020 Highlights:
- Total revenue from continuing operations was
€163.7 million (US$180.3 million), compared to €219.9
million in the first quarter of 2019. Despite the decrease in
revenue, gross profit increased from €53.6 million to €57.8 million
(US$63.7 million) year-over-year
mainly due to a favorable sports events calendar, from a margin
perspective, in the first quarter of 2020 prior to the full impact
of the COVID-19 pandemic and associated mitigation
efforts.
- Loss for the period from continuing operations was
€4.3 million (US$4.7 million), compared to a profit of
€3.4 million in the first quarter of 2019. The loss principally
reflected additional finance costs as well as increased personnel
expenses.
- Adjusted EBITDA from continuing operations was
€20.7 million (US$22.8 million), compared to
€28.2 million in the first quarter of 2019, mainly
reflecting the increase in operating expenses.
- There were only two mass participation events as part of our
continuing operations in the first quarter of 2020, as was the case
in the first quarter of 2019. The number of gross-paid athletes
decreased to 4,000 in the first quarter of 2020, compared to 45,000
in the first quarter of 2019, due to event cancellations as a
result of the COVID-19 outbreak.
- The Company completed a refinancing in March 2020 as a part of which it prepaid the
unsecured senior 364-day term loan facility entered into in
March 2019.
- The Group successfully extended and expanded its partnership
with the International Biathlon Union (IBU) for exclusive media and
marketing rights until the end of the 2029/30 season.
- The Group has been appointed by the French Tennis Federation as
host broadcaster for the French Open (Roland Garros) from 2021 to
2023.
Mr. Hengming Yang, Chief Executive Officer of Wanda Sports
Group, commented, "We started
off the year with good momentum from all of our business
segments. However, almost all major sporting events were
postponed or cancelled starting in March of this year due to the
global COVID-19 pandemic. Despite unprecedented market
conditions, we still delivered revenue of €163.7 million,
primarily driven by our resilient business model and long-term
contractual agreements, especially from our Spectator Sports
segment. In facing the market challenges, we plan to leverage
our advanced technology and to concentrate our innovative efforts
for expanded and differentiated content and digital solutions to
further drive the engagement of our athletes, fans and
partners. As we see the sport sector gradually re-open after
the Covid-19 related lockdowns, we believe we are well-prepared to
actively serve our partners and clients across our different
markets based on our global diversity, expertise and broad
capabilities. We continue to believe in the long-term global
dynamics of the sports industry, and our ability to execute our
growth strategies to further reinforce our strengths and
competitive advantages."
Mr. Brian Liao, Chief Financial
Officer of Wanda Sports Group commented, "In addition to managing
our financial and operating performance, one of our key focuses was
on improving our liquidity, in particular in light of the
uncertainty prompted by the global pandemic. We are pleased
with the successful completion of the refinancing in March which
enabled us to prepay the unsecured senior 364-day term loan
facility entered in March 2019. By
the end of the first quarter 2020, we had €164.7 million cash on
hand and we are expecting to further increase our liquidity
position with net proceeds of approximately €345 million to
€363 million from the closing sale of The IRONMAN Group.
Since the outbreak of the COVID-19 pandemic, we also quickly
adopted cost cutting measures across the entire Group in order to
minimize the overall impact on our business, including global
hiring freeze, reduction in non-essential spending and capital
expenditure, furloughs of employees in certain markets where
possible, and salary reductions where appropriate, as well as
taking advantage of various government assistance programs
available to us. We are confident that these proactive and
prudent actions will further enhance our financial flexibility and
resources as we address the economic uncertainty."
First Quarter 2020 Business Highlights
Core Business Segments:
Spectator Sports
In its spectator sports business, the Group successfully
delivered a number of world championships and large-scale regional
events in the first quarter of 2020, while expanding new business
wins.
Key events
- The Men's EHF (European Handball Federation) EURO 2020 was held from January 9 to January 26 across Sweden, Austria and Norway. For the first time in this
tournament's history, 24 teams competed for the title with 65
games, which resulted in approximately 160 hours of TV and social
media content.
- FIM Motocross World Championship declared the season opening on
the popular British circuit of Matterley Basin on March 1, and later the race continued to
the Netherlands. The Group is the
owner of the exclusive television, marketing and global promotional
rights to the FIM MXGP Motocross World Championship (and all
associated support series including the FIM Motocross of Nations)
until the 2036 season.
- BMW IBSF (International Bobsleigh & Skeleton Federation)
World Championships took place in Altenberg, Germany from February
17 to March 1. The Group, as the IBSF's long-standing
exclusive media and marketing rights partner, secured broadcasters
in over 60 territories globally.
- IBU World Championships took place in Rasen-Antholz,
Italy, from February 12 to February 23, 2020. The Group was
fully responsible for the event's marketing and sponsorship rights.
This event attracted over 160,000 spectators on site, and over 126
million hours of TV live action were viewed in nine key markets
with total average audiences up 21% compared to 2019.
- Champions Hockey League (CHL) Final Four took place in Hradec
Králové, Czech Republic in
February. The Group successfully captured the thrilling final game
content, by serving as the exclusive media and marketing partner
responsible for a variety of deliverables, including sponsorship,
media sales, client and broadcaster services.
- The 68th Four Hills Tournament continued in January
at the four traditional ski jumping hills, two in Germany and two in Austria. The Group served as the exclusive
marketing partner of the tournament, which achieved a total
cumulative audience of almost 420.54 million TV viewers across 329
broadcasting hours, and 104,100 visitors on-site over the four
competitions.
Major Prolongations
- An eight-year agreement with the IBU for exclusive media and
marketing rights has been extended until 2029/30, another addition
to the Group's world leading ski portfolio. This extended agreement
expands the Group's current role by adding the IBU Cup and IBU
Junior Cup – the second- and third-tier biathlon competition series
– to the portfolio. Previously the marketing rights included World
Cup and World Championship events only.
- German Bundesliga football club FSV Mainz 05 has extended its
exclusive marketing agreement with the Group until 2031, five years
before the current agreement expires. As part of this renewed
agreement, the Group is responsible for jersey sponsorship, stadium
naming rights, board advertising at home games and comprehensive
hospitality services at Mainz 05's stadium, the OPEL ARENA. This
renewed agreement also includes the right to market the youth
training centre as well as esport, handball and table tennis
teams.
Key New Business Wins
- Lega Serie A, the governing body of the top division of Italian
club football, has joined forces with the Group to officially
launch its Serie A Esports competition. The Group served as the
event's exclusive media, marketing and digital partner.
- The Group brokered a successful commercial agreement in which
Ligue 1 football club Olympique Lyonnais named Emirates as its new
official main sponsor after signing a five-year partnership until
the end of the 2024/25 season.
Digital, Production, Sports Solutions (DPSS)
- The Cadel Evans Great Ocean Road Race was held on February 2, 2020 in Geelong, Australia with over 120,000 spectators over
the four-day cycling festival. It was the sixth edition of the
Cadel Evans Great Ocean Road Race and the second event of the 2020
UCI World Tour. The Group served as the leading consultant for the
media production of the race.
- The Group launched an upgraded Content Management System (CMS)
platform for Activision Blizzard Call of Duty League and Overwatch
League sites, in order to improve the overall publishing
experience.
- The Group also partnered with a major US telco company to
launch a new 5G-based in-stadium experience which allows fans
equipped with a 5G device to enjoy multi-camera live and on-demand
streams of the game. Coupled with various real-time data overlays
and augmented reality features, the technology offers a truly
immersive, zero-latency fan engagement experience that will now be
brought to a variety of sports and entertainment across the
US.
- The Group has been appointed by the French Tennis Federation as
host broadcaster for French Open (Roland Garros) from 2021 to
2023.
- The Group has acquired a stake in Videocites, an artificial
intelligence-based video tracking and analytics company, and plans
to introduce its technology and services to current and future
rights partners of the Group. This includes content protection,
media monitoring and content management. Videocites' unique
fingerprinting technology enables immediate tracking of all copies
of live, on-demand and promotional content across all channels, in
order to garner deeper insight into consumer behavior for better
understanding of audiences and influencers.
Mass Participation
The first quarter is typically low season for mass participation
events of the Group. In the first quarter, the Group operated two
events, the same as in the corresponding period last year.
- Megamarsch season kicked off with the first ever long-distance
hiking event in Mallorca, Spain
and took place with almost 3,500 participants. The Group fully
organized and managed the entire event.
- HYROX, the World Series of Fitness for the winter season, was
held in Chicago and Dallas, USA
and Hanover, German in the first quarter of 2020. Over 3,200
participants joined the challenge.
China Business Highlights
In the first quarter of 2020, almost all sports events were
cancelled or postponed across China following the Chinese New Year in later
January, as a result of the impact of the COVID-19 pandemic.
- Over 1,000 local runners joined the Chengdu Shuangyi Health Run
on March 22 in Chengdu, Southwest
China. The event was a replacement of Chengdu Shuangyi
Marathon, which was scheduled for over 30,000 runners. The run
started from the historical location of Dujiangyan, with 10
starting gun shots every two minutes, in order to maintain social
distancing. The purpose of the event was to support in stimulating
the city's vitality, and energizing people under the pandemic.
- The Rock 'n' Roll Marathon Series organizing committee and
other 10 marathon and outdoor running event organizers jointly
launched online running for charity, in order to purchase medical
protective materials for the COVID-19 frontline hospitals.
First Quarter 2020 Financial Results
Inter-year Cyclicality
The Group's activities show a pattern of significant inter-year
cyclicality, particularly in its Spectator Sports segment.
In its Spectator Sports segment, the Group experienced the
effect of inter-year cyclicality in major sports events between
2019 and 2020. For example, in 2019, there were the FIS World
Championships (which occur only in odd years), while in 2020, there
were the Men's EHF (European Handball Federation) EURO 2020 (which occur only in even
years). The revenue generated from such events tends to be
most significant in the year the event is taking place, which
results in significant fluctuations in the Group's results of
operations between years.
Revenue
Total revenue was €163.7 million (US$180.3 million), representing a decrease
of 26% year-over-year, primarily attributable to a decrease in
revenue from the Spectator Sports and Mass Participation segments.
Excluding reimbursement revenues[1], total revenue was
€163.1 million (US$179.7 million), a decrease of 26% over
the first quarter of 2019.
[1]
Reimbursement revenues represent revenue that has associated costs
of a similar, generally matching, amount (reimbursement costs),
thereby resulting in a negligible gross margin impact.
|
The following table sets forth a breakdown of revenue by segment
for the periods indicated:
|
Three Months Ended
March 31,
|
|
2020
|
2019
|
(in millions,
except percentages)
|
USD
|
EUR
|
% of
Revenue
|
EUR
|
% of
Revenue
|
YoY
Change
|
Core
segments:
|
|
|
|
|
|
|
Spectator
Sports
|
154.0
|
139.8
|
85%
|
194.1
|
88%
|
(28%)
|
DPSS
|
25.2
|
22.9
|
14%
|
21.5
|
10%
|
6%
|
Mass
Participation
|
1.1
|
1.0
|
1%
|
4.3
|
2%
|
(78%)
|
Total
Revenue
|
180.3
|
163.7
|
100%
|
219.9
|
100%
|
(26%)
|
DPSS excluding
reimbursement revenues
|
24.6
|
22.3
|
|
21.5
|
|
4%
|
Total Revenue
excluding reimbursement
revenues
|
179.7
|
163.1
|
|
219.9
|
|
(26%)
|
- Spectator Sports: The decrease in revenue was primarily
due to cyclicality effect of the FIS World Championships 2019,
partially offset by the Men's EHF EURO
2020.
- DPSS: The increase in revenue was attributable to
continuing growth in the Group's digital business.
- Mass Participation: The decrease in revenue was
principally driven by the decrease in total number of gross-paid
athletes due to the COVID-19 impact. There were 4,000 gross-paid
athletes in the first quarter of 2020, compared to 45,000 in the
same period last year. The number of events were two in both
periods.
Gross profit
The following table sets forth a breakdown of gross profit and
the corresponding gross margin by segment for the periods
indicated:
|
Three Months Ended
March 31,
|
|
2020
|
2019
|
(in millions,
except percentages)
|
USD
|
EUR
|
Gross
margin
|
EUR
|
Gross
margin
|
YoY
Change in
Gross
Profit
|
Core
segments:
|
|
|
|
|
|
|
Spectator
Sports
|
52.3
|
47.5
|
34%
|
44.0
|
23%
|
8%
|
DPSS
|
11.3
|
10.2
|
45%
|
9.3
|
44%
|
9%
|
Mass
Participation
|
0.1
|
0.1
|
14%
|
0.3
|
7%
|
(54%)
|
Total Gross
Profit
|
63.7
|
57.8
|
35%
|
53.6
|
24%
|
8%
|
- Spectator Sports: The increase was primarily due to the
contribution from the Men's EHF EURO
2020 as well as the absence of revenue deduction relating to
German football business in 2019. These have offset the decrease in
contributions from the Group's summer sport events and other
football business.
- DPSS: The increase was primarily driven by continuing
growth in the Group's digital business.
- Mass Participation: The decrease in gross profit was
principally driven by the decrease in the number of gross-paid
athletes due to the COVID-19 impact.
Gross margin, or gross profit as a percentage of revenue,
was 35%, compared with 24% in the corresponding quarter of 2019,
primarily reflecting a favorable sports calendar in the spectator
sports events portfolio.
Personnel expenses were
€ 29.1 million (US$32.1 million), compared with
€26.4 million in the first quarter in 2019, primarily driven
by increased headcount due to business expansion.
Selling, office and administrative expenses were
€9.4 million (US$10.3 million),
compared with €7.0 million in the first quarter in 2019,
mainly resulting from increased professional service fees relating
to the Company's status as a public company following its initial
public offering in July 2019.
Depreciation and amortization
expenses were €5.8 million (US$6.4 million), compared with €5.0 million in
the first quarter in 2019, principally reflecting additional
amortization of purchase price allocations relating to prior
acquisitions in the Group's Spectator Sports and Mass Participation
segments.
Other operating expenses, net was €0.4 million
(US$0.5 million) compared with other
operating income, net of €1.0 million in the first quarter of
2019, primarily due to the absence of a release of a provision
relating to disposal of a business from prior year which was
recognized in the first quarter of 2019.
Finance costs were €12.1 million (US$13.3 million), compared with
€5.8 million in the first quarter in 2019, primarily due to
higher interest expense for the unsecured senior 364-day term loan
facility entered into in March 2019,
which the Company refinanced in March
2020, as well as higher interest expense for increased
borrowings at subsidiary level.
Income tax was €5.4 million (US$6.0 million), compared with €7.7 million
in the first quarter of 2019. This improvement was mainly due
to lower taxable profit at certain subsidiaries.
Loss for the period from continuing operations was
€4.3 million (US$4.7 million),
compared to a profit for the period €3.4 million in the first
quarter of 2019, mainly due to the increased gross profit was more
than offset by increased finance costs and increased personnel
expenses.
Adjusted EBITDA from continuing operations was
€20.7 million (US$22.8 million), compared to
€28.2 million in the first quarter of 2019, principally
resulting from increased personnel expenses, professional services
fees and other operating expenses, net.
Net loss for the Group (inclusive of discontinued operations)
attributable to ordinary shareholders of Wanda Sports Group Company
Limited was €23.7 million (US$26.1
million), compared to €8.9 million in the first quarter
of 2019.
Basic and diluted net loss for the
Group (inclusive of discontinued operations)
per American Depositary Share ("ADS") were both
€0.18 (US$0.19), compared to basic and diluted net loss per
ADS of both €0.08 in the first quarter of 2019.
Cash and cash equivalents
As of March 31, 2020, the Group
had total cash and cash equivalents of €197.8 million
(US$217.9 million) inclusive of
cash and cash equivalents attributable to discontinued operations.
Excluding cash and cash equivalents attributable to discontinued
operations, cash and cash equivalents were €164.7 million
(US$181.5 million).
Indebtedness
As of March 31, 2020, the Group
had total interest-bearing liabilities of €930.5 million
(US$1,025.0 million). Excluding
interest-bearing liabilities attributable to discontinued
operations, interest-bearing liabilities were €681.5 million
(US$750.7 million).
The following table sets forth a breakdown of interest-bearing
liabilities at period end.
|
March 31,
2020
|
(in
millions)
|
USD
|
EUR
|
Wanda Sports Group
Company Limited
|
229.6
|
208.4
|
Infront
Group
|
521.1
|
473.1
|
The IRONMAN
Group
|
274.3
|
249.0
|
Total
|
1,025.0
|
930.5
|
COVID-19 Business Operation & Outlook
- Following the global COVID-19 pandemic and resulting mitigation
measures, it is the Company's utmost priority to ensure the safety
and well-being of its athletes, employees and fans. As a result of
the outbreak and spread of COVID-19, and government and business
continuity measures adopted in response thereto, the Group closed
its corporate offices and requested that all employees either work
remotely or work at office premises in shifts for limited periods
of time. Currently, some employees have returned to workplaces with
heightened hygiene, face mask and social distancing protocols. In
addition, races and events in China were postponed due to containment
efforts in much of the country in the first quarter of 2020.
Although the Group continued to host some races and sports events
in Europe and North America in the first quarter of 2020, by
April 2020, all the remaining sports
events were cancelled or postponed. Currently, the Group is
significantly involved, together with other relevant stakeholders,
in active efforts to help in the resumption of cancelled or
postponed sports events (including if events are held without
spectators).
- The current priority is the planning for the resumption of
sports events in its different markets (even if without spectators
at venues). The Group is working closely with governments,
partners, rights holders, sponsors and event organizers to assess
the impact of COVID-19 on timing and the protocols for future
events, and to manage the financial impact across the value chain.
In anticipation that sports events may proceed in the future
without spectators, the Group is developing additional digital and
broadcast solutions to offer to and prepare partners for the
expected demand for new forms of live and digital sports
consumption. In addition, Infront is continuing its previously
announced discussions with rights owners and with its lenders.
- Despite the challenging environment, the Group continues to
innovate within its business, including online racing and event
experiences to keep athlete and fan communities connected and
engaged. For instance, the Group jointly supported the launch of
the first digital pro-cycling race series named Digital Swiss 5, as
an online alternative for the cancellation of Tour de Suisse with
professional cyclists competing against each other in a virtual
environment. The event achieved strong coverage on major public
broadcast networks across Europe.
Liquidity
- The Company had €164.7 million of cash and cash equivalents at
the end of the first quarter of 2020, exclusive of cash and cash
equivalents attributable to discontinued operations.
- The Company expects to receive approximately €345 million to
€363 million of net proceeds from the sale of The IRONMAN Group,
reflecting adjustments for closing date cash amounts, working
capital and outstanding indebtedness, as well as other
transaction-related expenses.
In addition to the strong liquidity position, management has
taken a disciplined approach to manage liquidity, including
temporary wage reductions through work rotation, global hiring
freeze, travel and marketing expense reductions, deferring planned
acquisition initiatives as well as reduction in capital
expenditure. Going forward, management will take additional
actions, as necessary, in order to improve the Company's liquidity
profile, enhance its financial flexibility and better manage market
risk.
Financial Guidance
Due to the significant uncertainties relating to the scope,
duration and impact of COVID-19, the Company currently is unable to
reasonably estimate its 2020 financial performance and,
accordingly, is not providing any updated guidance.
Management continues to believe that the Company's long-term
growth prospects remain promising and that Wanda Sports Group is
well positioned to play a
leading role in the global sports media and events industry into
the future.
Conference Call Information
On June 9, 2020, Wanda Sport's management will host an earnings
conference call at 8:00 AM U.S.
Eastern Time on June 8, 2020
(8:00 PM Beijing/Hong Kong time on
June 8, 2020).
Participants can join the earnings conference call by completing
online registration at:
http://apac.directeventreg.com/registration/event/1886225. Upon
registration, all participants will be provided with participant
dial-in numbers, passcodes and unique registrant IDs to access the
conference call.
Additionally, participants can join the call via a live webcast
of the earnings conference call at: http://investor.wsg.cn/. An
archived webcast will be available through the same link.
A telephonic replay will be available after the conclusion of
the conference call, from 11:00 AM
U.S. Eastern Time on June 8 to 09:59
AM U.S. Eastern Time on June 15,
2020 by dialing +61 2 8199 0299 and entering passcode
1886225.
About Wanda Sports Group
Wanda Sports Group is a leading global sports events, media and
marketing platform with a mission to unite people in sports and
enable athletes and fans to live their passions and dreams. Through
its businesses, including Infront and the Wanda Sports China, and,
pending its sale, The IRONMAN Group, Wanda Sports Group has
significant intellectual property rights, long-term relationships
and broad execution capabilities, enabling it to deliver inspiring
sports event experiences, creating access to engaging content and
building inclusive communities. Wanda Sports Group offers a
comprehensive array of events, marketing and media services through
its three primary segments: Spectator Sports, Digital, Production,
Sports Solutions (DPSS) and Mass Participation. Wanda Sport Group's
full-service platform creates value for its partners and clients as
well as other stakeholders in the sports ecosystem, from rights
owners, to brands and advertisers, and to fans and athletes.
Headquartered in China, Wanda
Sports Group, excluding the discontinued operations, has more than
53 offices in 16 countries with over 1,200 employees around the
world. For more information, please visit
http://investor.wsg.cn/investor-relations.
Use of Non-IFRS Financial Measures
To supplement our consolidated financial statements which are
presented in accordance with International Financial Reporting
Standards as issued by the International Accounting Standards Board
("IFRS"), we also use Adjusted EBITDA as a non-IFRS financial
measure. We present this non-IFRS financial measure because it is
used by our management in evaluating our operating results and for
financial and operational decision-making purposes. We define
Adjusted EBITDA as net income excluding share-based compensation
and other non-recurring expenses. We also believe that this
non-IFRS financial measure provides useful information to investors
and others in understanding and evaluating our consolidated results
of operations in the same manner as our management and in comparing
financial results across accounting periods and to those of our
peer companies.
Non-IFRS financial measures should not be considered in
isolation or construed as an alternative to profit/(loss) from
operations and net profit/(loss) or any other measure of
performance, or as an indicator of our operating performance.
Adjusted EBITDA may not be comparable to similarly titled measures
presented by other companies. Other companies may calculate
similarly titled measures differently, limiting their usefulness as
comparative measures to our data. We encourage investors and others
to review our financial information in its entirety and not rely on
a single financial measure.
Reconciliation of Adjusted EBITDA and EBITDA, another non-IFRS
financial measure, to the most directly comparable IFRS financial
measure is set forth at the end of this release.
Exchange Rate Information
This press release contains translation of certain Euro ("€")
amounts into U.S. Dollar ("$") at specified rates solely for the
convenience of readers. Unless otherwise noted, all translations
from Euro to U.S. dollar were made at the exchange rate of €0.9078
to US$1.00, the exchange rate on
March 31, 2020 set forth in the H.10
statistical release of the Board of Governors of the Federal
Reserve System.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements include, but are not limited to,
management quotes and the Company's financial outlook. These
forward-looking statements can be identified by terminology such as
"will," "estimate," "project," "predict," "believe," "expect,"
"anticipate," "intend," "potential," "plan," "goal" and similar
statements. The Company may also make written or oral
forward-looking statements in its periodic reports to the U.S.
Securities and Exchange Commission ("SEC"), in its annual report to
shareholders, in press releases and other written materials and in
oral statements made by its officers, directors or employees to
third parties. Such statements involve certain risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied in the forward-looking statements
and, consequently, could be affected by the uncertain and
unprecedented impact of COVID-19 on the Company's business and
operations and the related impact on its liquidity needs. These
forward-looking statements include, but are not limited to,
statements about: the impact of the spread of COVID-19 and related
mitigation efforts on the Company's business, operations and
operating results; the Company's goals and strategies, including
following the completion of the sale of the IRONMAN Group; the
expected growth in the Company's industry; the Company's
expectations regarding its ability to attract rights-in partners
and monetize their rights through rights-out arrangements; changes
in consumer behavior and consumer and corporate spending, including
as a result of the COVID-19 crisis; the Company's ability to reach
acceptable levels of engagement with its athletes following the
COVID-19 crisis; the Company's future business development, results
of operations and financial condition; competition in the Company's
industry; general economic and business conditions, including as a
result of the COVID-19 crisis; the outcome of discussions with
rights owners and lenders to mitigate the impact of the effects of
COVID-19 on the Group; and assumptions underlying or related to any
of the foregoing as well as risks, uncertainties, and other factors
described in "Risk Factors" and elsewhere in the Company's annual
report on Form 20-F for the year ended December 31, 2019, which is available on the
SEC's website at www.sec.gov. Additional information will be
made available in other filings that the Company makes from time to
time with the SEC.
In addition, any forward-looking statements contained in this
press release are based on assumptions that the Company's believes
to be reasonable as of this date. The Company undertakes no
obligation to update any forward-looking statements to reflect
events or circumstances after the date of this press release or to
reflect new information or the occurrence of unanticipated events,
except as required by law.
WANDA SPORTS GROUP
COMPANY LIMITED
|
INTERIM CONDENSED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
|
(Amounts in
thousands of Euro ("€") or, for convenience
translation, thousands of U.S.
Dollar ("$"), except for number of shares and per share
data)
|
|
|
For the three
months ended
|
|
March 31, 2020
|
|
March 31, 2019
|
|
|
$
|
€
|
|
€
|
Continuing
operations
|
|
|
|
|
|
Revenue
|
|
180,282
|
163,660
|
|
219,907
|
Cost of
sales
|
|
(116,610)
|
(105,859)
|
|
(166,276)
|
Gross
profit
|
|
63,672
|
57,801
|
|
53,631
|
Personnel
expenses
|
|
(32,101)
|
(29,141)
|
|
(26,397)
|
Selling, office and
administrative expenses
|
|
(10,301)
|
(9,351)
|
|
(6,992)
|
Depreciation and
amortization
|
|
(6,397)
|
(5,807)
|
|
(5,015)
|
Other operating
(expense)/income, net
|
|
(488)
|
(444)
|
|
977
|
Finance
costs
|
|
(13,330)
|
(12,101)
|
|
(5,839)
|
Finance
income
|
|
198
|
180
|
|
590
|
Share of
(loss)/profit of associates and joint ventures
|
|
(32)
|
(29)
|
|
137
|
Profit before
tax
from continuing operations
|
|
1,221
|
1,108
|
|
11,092
|
Income tax
|
|
(5,957)
|
(5,407)
|
|
(7,704)
|
(Loss)/profit for the period
from continuing operations
|
|
(4,736)
|
(4,299)
|
|
3,388
|
|
|
|
|
|
|
Discontinued
operations
|
|
|
|
|
|
Loss after tax for
the period from discontinued operations
|
|
(21,718)
|
(19,716)
|
|
(12,024)
|
Loss for the
period
|
|
(26,454)
|
(24,015)
|
|
(8,636)
|
|
|
|
|
|
|
Attributable
to:
|
|
|
|
|
|
Equity holders of the
parent
|
|
(26,060)
|
(23,657)
|
|
(8,860)
|
Non‑controlling
interests
|
|
(394)
|
(358)
|
|
224
|
|
|
(26,454)
|
(24,015)
|
|
(8,636)
|
|
|
|
|
|
|
Earnings per
share[2]:
|
|
|
|
|
|
Basic loss for the
period attributable to ordinary equity
holders of the parent
|
|
(0.13)
|
(0.12)
|
|
(0.05)
|
Diluted loss for the
period attributable to ordinary equity
holders of the parent
|
|
(0.13)
|
(0.12)
|
|
(0.05)
|
Basic loss for the
period attributable to ADS holders of the
parent
|
|
(0.19)
|
(0.18)
|
|
(0.08)
|
Diluted loss for the
period attributable to ADS holders of the
parent
|
|
(0.19)
|
(0.18)
|
|
(0.08)
|
|
|
|
|
|
|
Earnings per share
for continuing operations:
|
|
|
|
|
|
Basic (loss)/profit
for the period attributable to ordinary
equity holders of the parent
|
|
(0.02)
|
(0.02)
|
|
0.03
|
Diluted (loss)/profit
for the period attributable to ordinary
equity holders of the parent
|
|
(0.02)
|
(0.02)
|
|
0.03
|
Basic (loss)/profit
for the period attributable to ADS holders
of the parent
|
|
(0.03)
|
(0.03)
|
|
0.05
|
Diluted (loss)/profit
for the period attributable to ADS holders
of the parent
|
|
(0.03)
|
(0.03)
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
[2] Basic
and diluted earnings per share and profit attributable to ADS
holders of the parent for the three months
ended March 31, 2020 and 2019 were computed in the assumption that,
the Company had issued 23.8 million
ADS, and the Company had approximately 207 million and 169 million
ordinary shares issued and outstanding as
at March 31, 2020 and 2019 respectively.
|
WANDA SPORTS GROUP
COMPANY LIMITED
|
INTERIM CONDENSED
CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME
|
(Amounts in
thousands of Euro ("€") or, for convenience
translation, thousands of U.S.
Dollar ("$"))
|
|
|
For the three
months ended
|
|
March 31,
2020
|
|
March 31,
2019
|
|
|
$
|
€
|
|
€
|
Loss for the
period
|
|
(26,454)
|
(24,015)
|
|
(8,636)
|
Other comprehensive
income:
|
|
|
|
|
|
Other comprehensive
income/(loss) to be
reclassified to profit or loss in subsequent
periods (net of tax):
|
|
|
|
|
|
Net loss on cash flow
hedges
|
|
(6,725)
|
(6,105)
|
|
(333)
|
Exchange differences
on translation of
foreign operations
|
|
8,369
|
7,597
|
|
5,204
|
Net other
comprehensive gain to be reclassified
to profit or loss in subsequent periods
|
|
1,644
|
1,492
|
|
4,871
|
Other comprehensive
income for the period, net
of tax
|
|
1,644
|
1,492
|
|
4,871
|
Total comprehensive
loss for the period, net of
tax
|
|
(24,810)
|
(22,523)
|
|
(3,765)
|
Attributable
to:
|
|
|
|
|
|
Equity holders of the
parent
|
|
(24,390)
|
(22,141)
|
|
(4,757)
|
Non‑controlling
interests
|
|
(420)
|
(382)
|
|
992
|
|
|
(24,810)
|
(22,523)
|
|
(3,765)
|
WANDA SPORTS GROUP
COMPANY LIMITED
|
INTERIM CONDENSED
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
|
(Amounts in
thousands of Euro ("€") or, for convenience
translation, thousands of U.S.
Dollar ("$"))
|
|
|
March 31,
2020
|
|
December 31,
2019
|
|
$
|
€
|
|
€
|
ASSETS
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
Cash and cash
equivalents
|
181,450
|
164,720
|
|
163,225
|
Trade and other
receivables
|
267,297
|
242,652
|
|
264,041
|
Accrued
income
|
217
|
197
|
|
10,498
|
Contract
assets
|
53,662
|
48,714
|
|
53,541
|
Inventories
|
217
|
197
|
|
9,395
|
Income tax
receivables
|
3,678
|
3,339
|
|
13,594
|
Other
assets
|
82,747
|
75,118
|
|
81,001
|
|
589,268
|
534,937
|
|
595,295
|
Assets held for
sale
|
947,279
|
859,940
|
|
8,125
|
|
1,536,547
|
1,394,877
|
|
603,420
|
NON‑CURRENT
ASSETS
|
|
|
|
|
Long‑term
receivables
|
8,101
|
7,354
|
|
6,808
|
Investments in
associates and
joint ventures
|
4,414
|
4,007
|
|
3,277
|
Property, plant and
equipment
|
16,499
|
14,978
|
|
26,294
|
Right of use
assets
|
27,471
|
24,938
|
|
35,249
|
Intangible
assets
|
74,840
|
67,940
|
|
486,933
|
Goodwill
|
258,797
|
234,936
|
|
537,585
|
Contract
assets
|
11,419
|
10,366
|
|
10,268
|
Deferred tax
assets
|
19,119
|
17,356
|
|
23,063
|
Other
assets
|
71,593
|
64,992
|
|
63,164
|
|
492,253
|
446,867
|
|
1,192,641
|
TOTAL
ASSETS
|
2,028,800
|
1,841,744
|
|
1,796,061
|
WANDA SPORTS GROUP
COMPANY LIMITED
|
INTERIM CONDENSED
CONSOLIDATED STATEMENT OF FINANCIAL
POSITION
|
(Amounts in
thousands of Euro ("€") or, for convenience
translation, thousands of U.S.
Dollar ("$"))
|
|
|
March 31,
2020
|
|
December 31,
2019
|
|
$
|
€
|
|
€
|
LIABILITIES
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
Trade and other
payables
|
149,871
|
136,053
|
|
173,855
|
Interest‑bearing
liabilities
|
264,573
|
240,179
|
|
204,583
|
Lease
liabilities
|
7,710
|
6,999
|
|
10,041
|
Accrued
expense
|
57,568
|
52,260
|
|
69,846
|
Deferred
income
|
-
|
-
|
|
5
|
Contract
liabilities
|
135,458
|
122,969
|
|
199,900
|
Other
liabilities
|
14,394
|
13,067
|
|
19,208
|
Income tax
payable
|
11,957
|
10,855
|
|
21,787
|
Provisions
|
2,795
|
2,537
|
|
9,234
|
|
644,326
|
584,919
|
|
708,459
|
Liabilities directly
associated
with the assets held for sale
|
559,421
|
507,842
|
|
6,975
|
|
1,203,747
|
1,092,761
|
|
715,434
|
NON‑CURRENT
LIABILITIES
|
|
|
|
|
Interest‑bearing
liabilities
|
486,159
|
441,335
|
|
641,085
|
Lease
liabilities
|
20,796
|
18,879
|
|
29,154
|
Accrued
expenses
|
3,713
|
3,371
|
|
3,051
|
Contract
liabilities
|
22,086
|
20,050
|
|
17,271
|
Deferred tax
liabilities
|
22,287
|
20,232
|
|
99,202
|
Provisions
|
1,965
|
1,784
|
|
3,936
|
Long‑term payroll
payables
|
17,040
|
15,469
|
|
15,336
|
Other
liabilities
|
27,935
|
25,358
|
|
43,578
|
|
601,981
|
546,478
|
|
852,613
|
TOTAL
LIABILITIES
|
1,805,728
|
1,639,239
|
|
1,568,047
|
EQUITY
|
|
|
|
|
Share
capital
|
1,675,276
|
1,520,816
|
|
1,520,816
|
Reserves
|
(897,524)
|
(814,770)
|
|
(813,300)
|
Accumulated
deficit
|
(558,347)
|
(506,868)
|
|
(483,211)
|
Equity attributable
to equity holders of the parent
|
219,405
|
199,178
|
|
224,305
|
Non‑controlling
interests
|
3,667
|
3,327
|
|
3,709
|
TOTAL
EQUITY
|
223,072
|
202,505
|
|
228,014
|
TOTAL LIABILITIES
AND
EQUITY
|
2,028,800
|
1,841,744
|
|
1,796,061
|
WANDA SPORTS GROUP
COMPANY LIMITED
|
INTERIM CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS
|
(Amounts in
thousands of Euro ("€") or, for convenience
translation, thousands of U.S.
Dollar ("$"))
|
|
|
For the three
months ended
|
|
March 31,
2020
|
|
March 31,
2019
|
|
$
|
€
|
|
€
|
NET CASH FLOWS FROM
(USED
IN) OPERATING ACTIVITIES
|
16,894
|
15,336
|
|
(29,887)
|
NET CASH FLOWS USED
IN
INVESTING ACTIVITIES
|
(35,122)
|
(31,884)
|
|
(83,127)
|
NET CASH FLOWS
FROM
FINANCING ACTIVITIES
|
57,750
|
52,425
|
|
119,638
|
NET INCREASE IN CASH
AND
CASH EQUIVALENTS
|
39,522
|
35,877
|
|
6,624
|
Cash and cash
equivalents at
beginning of the period
|
179,803
|
163,225
|
|
177,048
|
Effect of foreign
exchange rate
changes, net
|
(1,436)
|
(1,303)
|
|
3,067
|
Transfer to assets
held for sale
|
(36,439)
|
(33,079)
|
|
-
|
CASH AND CASH
EQUIVALENTS AT END OF
PERIOD
|
181,450
|
164,720
|
|
186,739
|
RECONCILIATION OF
NON-IFRS MEASURE – IFRS Profit for the
Period to
Adjusted EBITDA (unaudited)
|
(Amounts in
thousands of Euro ("€") or, for convenience translation, thousands
of U.S.
Dollar ("$"))
|
|
|
For the three
months ended
|
|
March 31,
2020
|
|
March 31,
2019
|
|
$
|
€
|
|
€
|
|
|
|
|
|
Continued
operations
|
|
|
|
|
(Loss)/profit for the
period from continuing operations
|
(4,736)
|
(4,299)
|
|
3,388
|
Income tax
|
5,957
|
5,407
|
|
7,704
|
Net interest
expenses
|
9,451
|
8,579
|
|
2,893
|
Depreciation and
amortization
|
6,397
|
5,807
|
|
5,015
|
EBITDA from
continuing operations
|
17,069
|
15,494
|
|
19,000
|
|
|
|
|
|
Share-based
compensation (1)
|
1,346
|
1,222
|
|
451
|
Expenses or charges
relating to acquisition (2)
|
-
|
-
|
|
186
|
Expenses or charges
relating to IPO or financing (3)
|
350
|
318
|
|
225
|
Losses on foreign
exchange and derivatives, and other financial
charges (4)
|
3,681
|
3,342
|
|
2,356
|
Estimated client
compensation relating to fraudulent activities( 5)
|
-
|
-
|
|
6,000
|
Expenses or charges
relating to Sarbanes-Oxley compliance (6)
|
212
|
192
|
|
-
|
Net loss on disposal
of assets (7)
|
93
|
84
|
|
-
|
Expenses relating to
shareholder class action lawsuit (8)
|
69
|
63
|
|
-
|
Adjusted EBITDA from
continuing operations
|
22,820
|
20,715
|
|
28,218
|
|
|
|
|
|
Discontinued
operations
|
|
|
|
|
Loss for the periods
from discontinued operations
|
(21,718)
|
(19,716)
|
|
(12,024)
|
Net interest expense,
income tax, depreciation and amortization
|
(2,900)
|
(2,631)
|
|
5,534
|
EBITDA from
discontinued operations
|
(24,618)
|
(22,347)
|
|
(6,490)
|
Adjustments
(9)
|
11,856
|
10,763
|
|
2,745
|
Adjusted EBITDA from
discontinued operations
|
(12,762)
|
(11,584)
|
|
(3,745)
|
|
|
|
|
|
Adjusted
EBITDA
|
10,058
|
9,131
|
|
24,473
|
|
|
|
1. Share-based
compensation has been excluded as it is a non-recurring
expense.
|
2. Represents
expenses incurred for professional fees such as legal counsel,
auditors, underwriters, valuation experts and
consultants mainly in respect of acquisitions.
|
3. Represents
professional fees of legal counsel, auditors, due diligence
experts, consultants, and related expenses for our IPO and
financing.
|
4. Represents the
loss on foreign exchange, derivative financial instruments at fair
value through profit or loss, termination of the
cross-currency swap and other financial charges.
|
5. Represents the
amount estimated to be paid by Infront as compensation in
connection with fraudulent activities presumably
undertaken by a former senior employee of Infront.
|
6. Represents
Sarbanes-Oxley Act consulting charges paid to third
parties.
|
7. Represents net
loss on disposal of property, plant and equipment and intangible
assets.
|
8. Represents legal
fees related to shareholder class action, dismissed on May 18,
2020.
|
9. Represents
share-based compensation amounting to €2.6 million, losses on
foreign exchange amounting to €7.2 million and
other non-recurring expenses amounting to €1.0 million.
|
View original
content:http://www.prnewswire.com/news-releases/wanda-sports-group-company-limited-reports-first-quarter-2020-results-301072485.html
SOURCE Wanda Sports Group Company Limited