First quarter 2012 revenues

Solid revenue performance across activities

Paris (France), 26 April 2012 – The Board of Directors of Technicolor (Euronext Paris: TCH) met yesterday to review the Group’s revenues for the first quarter of 2012.
 

Q1 2012 revenues highlights

Group revenues from continuing operations amounted to €800 million compared to a strong first quarter of 2011 at €812 million.

• Technology: continued strength in Licensing revenues.
• Entertainment Services: resilient revenue performance almost entirely compensating the rapid decline in photochemical film activities.
• Digital Delivery: stabilization at Connected Home level as the division recorded stable revenues year-on-year.
   

Revenues of the first quarter of 2012 (ending 31 March)
 

[1] Media Services activity, formerly reported in Digital Delivery segment, is now included in Creation Services business within Entertainment Services segment. Media Services revenues amounted to €15 million in the first quarter of 2012, stable compared with the first quarter of 2011.
 

Q1 2012 highlights

Entertainment Services started new services to the Studios, in particular with the opening of Sound facilities both in Los Angeles and in France. Connected Home won new customers awards in Latin America and Asia-Pacific, strengthening its position in fast growing markets, while maintaining its focus on improving its overall top line with the introduction of new services and new products. The action plan announced at the end of December 2011 has already started to generate some improvements. Technicolor confirms its objective of returning Connected Home to Adjusted EBITDA[1] breakeven in 2012.

Innovation: Technicolor has launched new research orientations to align technology innovation with its Amplify 2015 strategic roadmap.

Technicolor signed a binding agreement to sell its Broadcast Services activity to Ericsson.

Update on financial situation: continued focus on improving financial structure

Estimated gross debt at the end of the first quarter of 2012 decreased both in nominal value and on an IFRS basis compared to year-end 2011, reflecting €47 million of debt repayments split between mandatory prepayments and excess cash flow allocation. As net cash has decreased as expected in the first quarter, net debt was up compared with the end of December 2011.

Technicolor has signed an amendment to improve terms and conditions of the $125 million Wells Fargo credit facility. The new amendment includes an extension of the credit line from April 2013 to April 2016, a change in the calculation of the borrowing base improving funding availability and a reduction of ongoing costs.
 

Confirmation of 2012 objectives

Based on a resilient first quarter performance, Technicolor confirms its 2012 objectives:

• Adjusted EBITDA in the range of €475-500 million;
• Continue to generate positive free cash flow[2] despite higher restructuring expenses and investments in growth businesses;
• Operate within the financial covenants of credit agreements.
   

Frederic Rose, Chief Executive Officer of Technicolor, stated: “Technicolor delivered a solid sales performance in the first quarter of 2012. I am particularly encouraged by the commercial and operational progress of Connected Home, as well as the sustained level of our Licensing revenues. This performance makes me confident that we are well on track to delivering on our 2012 objectives of Adjusted EBITDA of €475-500 million and continued generation of positive free cash flow.”

An analyst conference call hosted by Frederic Rose, CEO and Stéphane Rougeot, CFO and SEVP Strategy will be held on Thursday, 26 April 2012 at 4:00 pm CET.
 

Financial Calendar

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Warning: Forward Looking Statements

This press release contains certain statements that constitute "forward-looking statements", including but not limited to statements that are predictions of or indicate future events, trends, plans or objectives, based on certain assumptions and include any statement which does not directly relate to a historical fact or current fact. Such forward-looking statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the future results expressed, forecasted or implied by such forward-looking statements. For a more complete list and description of such risks and uncertainties, refer to Technicolor’s filings with the French Autorité des marchés financiers.

About Technicolor

Technicolor, a worldwide technology leader in the media and entertainment sector, is at the forefront of digital innovation. Our world class research and innovation laboratories enable us to lead the market in delivering advanced video services to content creators and distributors. We also benefit from an extensive intellectual property portfolio focused on imaging and sound technologies, based on a thriving licensing business. Our commitment: supporting the delivery of exciting new experiences for consumers in theaters, homes and on-the-go. Euronext Paris: TCH - www.technicolor.com

Contacts

Press: +33 1 41 86 53 93
technicolorpressoffice@technicolor.com

Investor relations: +33 1 41 86 55 95
investor.relations@technicolor.com

[1] EBIT from continuing operations excluding other income (expense), and Depreciation & Amortization (including impact of provisions for risks, litigations and warranties).

[2] Free Cash Flow from both continuing operations and discontinued operations.