(AOF) – Despite the many controversies and calls for a boycott linked to the World Cup in Qatar (November 20-December 18), French viewers did not shy away from yesterday’s introduction to the France team, which largely dominated Australia (4-1). They were on average 12.5 million (i.e. 48.5% market share) to follow the meeting on TF1, holder of the 28 best posters of the competition. La Une signed its best prime time audience since June 28, 2021 and the elimination of the Blues in the round of 16 of the Euro against Switzerland.
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Key points
– Leading French television group with 29.9% audience share among 25-49 year olds;
– Five free-to-air channels -TF1, TMC, LCI, TFX, TF SERIES FILMS- 4 thematic pay channels -TV Breizh, Histoire, Ushuaïa and SérieClub- and a digital replay platform, MYTF1;
– Turnover of €2.4 billion, 89% generated in France and divided into three sectors: channel advertising (76% of revenue), studio and entertainment activities (17%) with Newen and the “Digital Unify”, bringing together the activities carried out under the brands Aufeminin, Doctissimo, Gamned! Marmiton, MylittleParis, Studio71 and Digital Factory;
– Business model based on 4 strengths: human, intellectual (editorial, commercial and content producer know-how), financial (solid equity and cash flow) and physical capital;
– Capital locked by Bouygues (43.7%) and by employees (9.1%) and by the legislative impossibility of a takeover bid, the chairmanship of the 11-member board being held by Gilles Pélisson until February 13, 2023 before he sold it to managing director Rodolphe Belmer;
– No debt, with shareholders’ equity of €1.8 billion and a net surplus of €296 million which will be increased by the disposal of Unify Publishers activities.
Challenges
– Strategy in 3 points: reinforcement of the core business, growth in streaming, production via internal synergies, development of Tech Media;
– Innovation strategy applied upstream with the production of content, downstream with digital, relying on the TF1 FabLab:
– expansion of Tech Media in OTT, AdTech, open innovation and the cloud;
– support for start-ups (more than 30), with acceleration program (from creation to distribution) via the One Inno fund, the Media Lab and 3 innovation hubs;
– focus on database authentication (23 million users) for a targeted offer, including on certain households, via precision and granularity;
– Environmental strategy
– 2030: 30% decline vs 2019 in CO2 emissions via eco-production, digital sobriety, soft mobility, decarbonisation of purchases and a climate contract,
– 2025: 35% reduction in the electricity consumption of the TF1 tower;
– Leading advertising agency in France, with remarkable multi-media expertise and the ability to continuously reduce production costs.
Challenges
– Highly regulated sector with limits to redeployments and external growth, uncertainties related to the rise of video on demand and the reopening of negotiations around the media chronology in February 2023;
– After the abandonment of the merger project with M6 due to requirements deemed too high by the Competition Authority, questions about the group’s future strategy;
– Rumors of the release of the Salto video-on-demand platform;
– After a 5.4% increase in revenues and 7% in operating profit at the end of September, 2022 objectives of strengthening audiences with the Football World Cup at the end of 2022 and the Star Academy for the Media and deliveries division important in the 2nd half and partnerships with platforms for Newen Studios.
Sector analysis Communication and Media
French players well positioned in audiovisual production
Among the independent players, the Frenchman Banijay is the world leader with an expected turnover of 3 billion euros in 2022 in a market which represents 100 billion in revenue. Mediawan (backed by the KKR fund), whose turnover amounts to 1 billion euros, is the other main French player in the sector. The market is still very fragmented because according to the European Audiovisual Observatory, the top twenty production groups were responsible for only 38% of titles created in 2020. However, experts believe that the sector has entered a phase consolidation. Thus Banijay’s stock market listing aims to enable it to better participate in this movement.