Investor Presentation As of Fourth Quarter and Full Year 2018 - - PowerPoint PPT Presentation

Investor Presentation

As of Fourth Quarter and Full Year 2018

Disclaimer

This presentation 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 presentation 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 presentation 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.

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SKY CONTENT

37% 21% 34%

SNAPSHOT: Our Core Businesses

CONTENT

Advertising Four broadcast channels in Mexico City and affiliated stations throughout the country Network Subscription 26 pay-tv networks and 74 feeds in Mexico and globally Licensing & Syndication Univision royalties, other licensing fees, and exports to over 75 countries

CABLE A leading cable operator

in Mexico Video: 4.4 million RGUs * Data: 4.5 million RGUs Voice: 3.0 million RGUs

* Revenue generating units

SKY A leading DTH system in Mexico and internet

provider, also operating in Central America and the Dominican Republic 7.7 million RGUs

Video Voz WiFi

Share of Consolidated Revenue 2018

3

CABLE CONTENT SKY

Source: Grupo Televisa's public filings

• North of Ps 100 billion in consolidated revenue, growing at a CAGR* of 6.5% since 2013
• Consolidated Operating Segment Income (“OSI”) Ps 40 billion, a CAGR of 6.4% since 2013
• Investment grade. Average debt maturity of 14.7 years. Net-debt-to-EBITDA of 2.2x
• Declining Capital Expenditures-to-Sales ratio from 27.6% in 2016 to 17.7% in 2018
• 19.6 mm revenue generating units (“RGUs”) contributing with 61.6% of Consolidated OSI

in 2018

• Fastest growing broadband provider in the country in terms of new customers
• Content production powerhouse. During the fourth quarter, 40% of the audience in prime

watched one of our broadcast or pay-TV channels.

• Two thirds of Televisa’s equity is in the hands of institutional investors, mostly U.S. based
• Publicly traded in the NYSE since 1993 and in the Mexican Stock Exchange since 1991

SNAPSHOT: Highlights

4

*Compound Annual Growth Rate

DEFINING TRENDS

5

I. Highlights 4Q’18 II. Diversified revenue streams

• III. Growing operating cash flow
• IV. Untapped opportunities in growth markets

V. Strong balance sheet

7.7 8.1 8.5 9.9 9.9 10.9 10.2 10.5

Consolidated OSI

• Ps. in billions

18.3 19.8 21.4 24.0 25.0 27.3 26.0 26.7

Consolidated Revenue

• Ps. in billions

Highlights 4Q’18

Source: Grupo Televisa's public filings

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• Consolidated Net Sales and

Operating Segment Income grew 2.9% and 3.2%, respectively

• Advertising sales upfront reached

16.4 billion pesos

• Double-digit growth in Cable MSO

Segment Sales and Operating Segment Income of 11.0%

• Sky reached 92 thousand of

broadband RGUs

• Televisa concludes its

restructuring analysis with the decision to remain as a vertically integrated media and telecommunications operator

1.4 1.6 1.7 2.5 3.0 3.3 3.7 4.0

4Q'11 4Q'12 4Q'13 4Q'14 4Q'15 4Q'16 4Q'17 4Q´18

Cable O.S.I.

• Ps. in billions

3.7 4.0 4.6 6.2 7.6 8.3 8.6 9.5

4Q'11 4Q'12 4Q'13 4Q'14 4Q'15 4Q'16 4Q'17 4Q´18

Cable Revenue

• Ps. in billions
• Strong top line growth: 16.2% CAGR from 2013
• OSI margins have expanded rapidly, reaching 42.1%

in 4Q’18, up from 35.8% in 2013

• During 4Q’18 total net adds were 316 thousand,

representing a year-over-year growth in RGUs of 11.7% .

• Churn has come down significantly
• After important decline in capex, it is now free cash

flow positive

• Over 14.5* million homes passed, from which more

than 90% can receive data speeds of 100 Mbps

• We purchased the fiber-to-the-home business of

Axtel in certain cities, adding more than 550 thousand RGUs

Net Adds ('000)

1Q18 2Q18 3Q18 4Q18 Video 53 78

• 35

6 Broadband 173 136 62 81 Telephony 36 115 247 229 RGU Net Adds 262 329 274 316

Source: Grupo Televisa's public filings *Excluding acquired homes passed from Axtel

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Highlights 4Q’18

1.4 1.6 1.8 2.0 2.2 2.4 2.3 2.2

4Q'11 4Q'12 4Q'13 4Q'14 4Q'15 4Q'16 4Q'17 4Q´18

Sky O.S.I.

• Ps. in billions

3.2 3.8 4.2 4.5 5.0 5.5 5.6 5.5

4Q'11 4Q'12 4Q'13 4Q'14 4Q'15 4Q'16 4Q'17 4Q´18

Sky Revenue

• Ps. in billions

Highlights 4Q’18

• As of 4Q’18, close to eight million pay TV RGUs in

Mexico, Dominican Republic and Central America

• Revenue reached Ps 22.0 billion in 2018,

contributing with 20.7% of consolidated revenue

• Margins have remained solid at around 45% for

more than 10 years, in spite of strong competition

• Only pay TV platform in Mexico to transmit all 64

matches of the 2018 Soccer World Cup

• We launched broadband services under the Blue

Telecomm brand:

• Fixed broadband through incumbent’s network

(3 to 200 Mbps – subject to incumbent’s technical capability in a given location)

• Fixed wireless broadband through Red

Compartida and AT&T’s wireless network (5 and 10 Mbps)

• As of the end of 2018, close to 92 thousand

broadband RGUs

Source: Grupo Televisa's public filings

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4.8 4.8 4.7 5.1 4.6 4.8 3.9 4.0

4Q'11 4Q'12 4Q'13 4Q'14 4Q'15 4Q'16 4Q'17 4Q´18

Content O.S.I.

• Ps. in billions

9.7 10.2 10.4 10.8 10.6 10.6

4Q'11 4Q'12 4Q'13 4Q'14 4Q'15 4Q'16 4Q'17 4Q´18

Content Revenue

• Ps. in billions

11.1 11.7

• We are the leading producer of Spanish language

content in the world

• As of 4Q18, Content Revenue and Operating

Segment Income posted growth of 0.3% and 3.0%, respectively

• We fully revamped our content offering with

more updated formats and storylines and higher production values

• Our flagship broadcast network alone brought

more viewers than all competing pay TV networks combined

• We are partnering with leading global content

players such as Amazon, Endemol, Mediapro and Sony

• Our new advertising sales mechanism has now

been fully assimilated and is achieving its

• bjectives

Source: Grupo Televisa's public filings

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Highlights 4Q’18

Highlights 4Q’18

• #1 Morning, afternoon and prime time channel in Mexico
• Most watched shows (Mo-Fri): La Rosa de Guadalupe, Mi marido tiene más familia, Sin

miedo a la verdad.

• #1 Comedy Shows: El privilegio de mandar, 40 y 20, Nosotros los Guapos.
• #1 Magazine show: Hoy
• Sunday reality leaders: La Voz México, Pequeños gigantes and Mira quien baila.
• 5 of our networks within the 10 most watched pay TV channels in Mexico
• Most watched channel among women: Tlnovelas and Unicable
• #3 and #4 most watched movie networks: De Película and Golden
• Leaders in music/lifestyle channels: RMS and Bandamax
• Channel 2 and Channel 5 have as much audience as all pay TV channels combined
• Most successful animated content

(Ch.2)Las Estrellas Kids News Sports Movies

• #1 morning newscasts with Despierta con Loret and Al aire con Paola
• #1 night newscast with En punto con Denise Maerker
• #1 news channel on a national basis: Foro TV
• 23 out of 30 most watched soccer matches in local league.
• Most watched night soccer show: La Jugada and NTD. Exclusive sports events
• Leader in 2018 Soccer World Cup audience
• Most watched movies in FTA TV: No se aceptan devoluciones and No manches Frida

Televisa Networks

10

DEFINING TRENDS

11

I. Highlights 4Q’18 II. Diversified revenue streams

• III. Growing operating cash flow
• IV. Untapped opportunities in growth markets

V. Strong balance sheet

33.8 34.9 34.3 36.7 34.0 39.2

2013 2014 2015 2016 2017 2018

Content Revenue

• Ps. in billions

16.1 17.5 19.3 21.9 22.2 22.0

2013 2014 2015 2016 2017 2018

Sky Revenue

• Ps. in billions

17.1 20.9 28.5 31.9 33.0 36.2

2013 2014 2015 2016 2017 2018

Cable Revenue

• Ps. in billions

DIVERSIFIED REVENUE STREAMS

Strong organic growth as a result

• f attractive 3-play offers and a

focus on customer service Leveraging off its customer base

• f 7.6 millions of subscribers to

sell broadband services Resuming growth after the negative impact of an unfavorable ad sales pricing mechanism

Source: Grupo Televisa's public filings

12

A strong position in our three core businesses

52% 48% 41% 38% 34% 37% 25% 25% 25% 25% 27% 24% 21% 24% 32% 34% 37% 38%

2013 2014 2015 2016 2017 2018

Contribution to OSI

Others Cable Sky Content

73.8 80.1 88.1 96.3 93.6 101.3

39.7% 39.6% 39.6% 39.2% 38.7 38.3%

2013 2014 2015 2016 2017 2018

Consolidated Revenue

OSI Margin

• Ps. in billions

Cable has overtaken Content as the most important contributor to Consolidated OSI

DIVERSIFIED REVENUE STREAMS

13

Distribution (Cable & Sky) overtook Content in terms of OSI since 2014

Our multiple revenue sources have allowed us to post a CAGR

• f 6.5% since 2013

Source: Grupo Televisa's public filings

7.4 7.7 8.3 8.6 7.7 8.0 6.8 6.6 0.7 0.8 0.6 0.8 1.0 1.0 1.1 1.3 1.6 1.7 1.5 1.7 2.1 2.7 2.6 2.8

Content Revenue

Licensing & Syndication Network Subscription Advertising

• Ps. in billions

76% 76% 80% 78% 71% 68% 64% 62% 24% 24% 20% 22% 29% 32% 36% 38%

Content Revenue Mix

All Other Content Revenue Advertising Revenue

DIVERSIFIED REVENUE STREAMS Content

• Televisa’s content revenue

mix has changed over the years

• During 4Q’18, advertising

revenues represented 62%

• f Content revenues
• On a consolidated basis,

advertising revenues represented 25% of consolidated revenues in 4Q’18

• Televisa continues to explore
• ther ways of diversifying its

Content revenue base

14

Within Content, the revenue mix has also changed with advertising declining in importance

Source: Grupo Televisa's public filings

2,911 2,858 2,999 2,937 2,714 1,254 1,312 1,333 1,310 1,023 573 540 494 423 391 2014 2015 2016 2017 2018

Univision

Total Revenue Adjusted OIBDA Interest Expense

USD Millions

313.7 311.1 324.6 313.9 383.6 2014 2015 2016 2017 2018

Royalties

USD Millions

DIVERSIFIED REVENUE STREAMS Content

• We monetize our content in U.S.

through our licensing agreement with Univision.

• The royalty rate is 16.45% of

substantially all of Univision’s audiovisual revenue.

• A step up in the royalty rate of

Univision came into effect on January and July 2018.

• In addition to our stream of

royalties, we hold equity and warrants of Univision which upon their exercise would represent 36%.

15

The majority of our Licensing and Syndication revenue originates in the Univision Royalties

Source: Grupo Televisa’s and Univision’s public filings

KPI Q4 2017 Q4 2018 % Chg.

Televisa Sites’s Users 11m 14m 27% Televisa Pageviews 234m 291m 24% YouTube views 846m 2.0b 142% Facebook views 1.1b 1.8b 61% Instagram views 15m 50m 228%

DIVERSIFIED REVENUE STREAMS Content

• The number of views of our

content in YouTube, Facebook and Instagram reached close to 12 billion in 2018 (87% y/y growth).

• During 2018 we became the

number one digital platform among all media companies in terms of number of users (comScore).

• In our own digital platforms, we

closed the year with 14 million users, 27% more than in 4Q17.

16

We are developing our digital platforms to turn them into a new, solid revenue stream

Users: comScore (Desktop 6+ and Total Mobile 15+) Pageviews: comScore (Desktop 6+ and Total Mobile 15+) Youtube, Facebook and Instagram views: Tubular (Televisa total property data)

Some of our key online destinations: www.televisa.com www.lasestrellas.tv deportes.televisa.com noticieros.televisa.com

2.5 3.4 4.1 4.2 4.2 4.4 1.7 2.3 3.1 3.4 3.8 4.5 0.9 1.2 1.9 2.1 2.1 3.0

2013 2014 2015 2016 2017 2018

Cable RGUs

Voice RGUs Data RGUs Video RGUs in millions 33% 33% 34% 35% 38% 38% 18% 18% 21% 22% 21% 25% 49% 49% 45% 43% 41% 37%

2013 2014 2015 2016 2017 2018

Cable RGU Mix

Video Voice Data

DIVERSIFIED REVENUE STREAMS: Cable

• Strong gross additions
• Voice and data are the main

sources of growth

• Many data customers are

upgrading to faster speeds

• Growing in high speed Fiber-

to-the-Home users

17

Within Cable, data and voice account for 63% of revenue generating units

Source: Grupo Televisa's public filings

• 68 live channels from Mexico and

from global content distributors

• Over 30 thousand on-demand

assets from Televisa’s extensive library, FOX Premium, HBO MAX, and other international content partners

• Different content at the same

time, on the TV and other devices

• With izzi Kids, six live TV channels

and hundreds of hours on video

• n demand
• Over 187 thousand users as of

4Q18

DIVERSIFIED REVENUE STREAMS: Cable

18

Our izzi go app further positions our cable operation for evolving viewing habits

DEFINING TRENDS

19

I. Highlights 4Q’18 II. Diversified revenue streams

• III. Growing operating cash flow
• IV. Untapped opportunities in growth markets

V. Strong balance sheet

2.0 2.4 2.5 2.9 2.1 1.7 5.0 5.1 5.4 6.2 3.8 3.9 7.6 9.2 16.2 17.6 10.1 12.3

2013 2014 2015 2016 2017 2018

Capital Expenditures

Cable Sky Content

• Ps. in billions

GROWING OPERATING CASH FLOW

Source: Grupo Televisa's public filings

20

The free cash flow profile of Televisa has improved dramatically

• Expanding operating cash flow

in Cable and Sky has increased

• ur ability to generate strong

free cash flow

• The contribution to consolidated

OSI, net of capital expenditures, has almost doubled since 2016

15.2 15.5 11.5 12.3 21.5 22.8

2013 2014 2015 2016 2017 2018

O.S.I minus Capex

• Ps. in billions

• During 2015 and 2016, Televisa accelerated its

capital investments in Cable segment

• It embarked on a heavy-capex phase to upgrade

its network and support growth in RGUs

• Cable capex reached Ps 17.6 billion in 2016

making Televisa one of the most important investors in Mexico’s telecom infrastructure that year

• As a percentage of revenues, Cable capex came

down from 55% in 2016 to 34% in 2018

GROWING OPERATING CASH FLOW: Cable

Source: Grupo Televisa's public filings. * Organic growth only. Excludes RGU growth from acquisitions

21

We are entering a harvesting phase after heavy investments in infrastructure

0.2 0.4 0.5 0.6 0.5 0.7 0.6 1.5 0.7 0.4 1.2

Cable net adds

RGUs in millions

• 1.6
• 0.4
• 0.2
• 1.5
• 1.4
• 4.8
• 4.3

3.9 3.0

2010 2011 2012 2013 2014 2015 2016 2017 2018

Cable OSI net of CAPEX

• Ps. in billions

• 0.4

2.8 2.7 2.3 3.1 3.5 3.7 6.3 5.9

2010 2011 2012 2013 2014 2015 2016 2017 2018

Sky OSI net of CAPEX

• Ps. in billions

0.17 0.20 1.08 0.96 1.15 0.86 0.62 0.65 0.74

• 0.02 -0.37

Sky net adds

Subs in millions

• Sky launched VeTV is 2010, a pre-paid basic pay TV

package

• Following its launch, Sky embarked on an

aggressive campaign to add customers

• Its net adds reached a peak in 2012 installing over

40,000 new services every week, on average

• In 2016, growth further accelerated with the shut-

down of the FTA analog signals

• Slower net adds means slower deployment of

capital to activate new customers

• With slower net adds starting in 2017, Sky free

cash flow generation has increased substantially

GROWING OPERATING CASH FLOW: Sky

Source: Grupo Televisa's public filings

22

Cash flow has increased substantially after 2016 due to lower capital needs

DEFINING TRENDS

23

I. Highlights 4Q’18 II. Diversified revenue streams

• III. Growing operating cash flow
• IV. Untapped opportunities in growth markets

V. Strong balance sheet

• According to the Mexican regulator, as of the end
• f the third quarter 2018, 7.1 million customers

were still on copper (DSL: Digital Subscriber Line)

• This is a fertile pool for Cable as it takes

advantage of its superior coaxial and fiber infrastructure

• In the last seven quarters our Cable Segment has

added more than twice the data RGUs added by the incumbent

Source: Internal analysis based on IFT and other companies ’ public information

24

UNTAPPED OPPORTUNITIES: Broadband Market

119 145 157 173 136 62 311 14

• 23

36 110

• 8

4 249 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q´18 4Q´18

Data Net Adds

Incumbent Televisa Cable

Thousand RGUs

It Includes RGUs acquired from Axtel 39.1% 38.1% 20.2% 2.6%

Composition of Data Subs in Mexico

DSL Coaxial Fiber Other

Source: Internal analysis based on IFT and other companies’ public information

• Our cable operation, izzi, has been gaining

market share for more than 5 years

• In spite of Televisa’s strong growth in the

telecom market, it is still a small participant in the industry

25

UNTAPPED OPPORTUNITIES: Broadband Market

11.0% 13.1% 16.4% 20.8% 21.3% 22.2% 24.1%

2012 2013 2014 2015 2016 2017 2018

Televisa Cable Market Share - Data services

68.2 7.0 15.5 4.1 5.5 7.5 11.6

Telecom Market Sahre

AMX Telefónica AT&T Megacable Sky Televisa Cable Otros

As of 4Q18

• Mexico’s broadband market is just developing. Data customers in Mexico still have among the lowest

speeds in the OECD.

• Mexico has the second lowest penetration of data services of all OECD countries, and the lowest speed.
• We are positioned like to no other operator in Mexico to benefit from increased demand for broadband.

Source: OECD, Broadband Portal (June 2018)

26

UNTAPPED OPPORTUNITIES: Broadband Market

0.0 10.0 20.0 30.0 40.0 50.0 Switzerland Denmark France Netherlands Korea Norway Germany United Kingdom Iceland Belgium Sweden Canada Luxembourg Greece Portugal United States New Zealand Australia Spain Finland Japan Hungary Estonia Czech Republic Ireland Slovenia Austria Lithuania Israel Italy Latvia Slovak Republic Poland Chile Turkey Mexico Colombia

Fixed broadband penetration

subscribers per 100 inhabitants

There are 33mm homes in the country

• f which more than 14.5mm homes are

passed by Televisa Cable Of those, more than 90% of the homes are capable of getting 100Mbps from Televisa Cable but only 4.5mm homes are currently our customers There is plenty of room for further growth under existing homes passed

Source: Internal analysis based on IFT and other companies’ public information

27

UNTAPPED OPPORTUNITIES: Broadband Market

• Less than half of our homes passed are currently customers of Televisa for broadband services
• In the large majority of the markets we reach, Televisa is the provider capable of delivering the fastest speeds

DEFINING TRENDS

28

I. Highlights 4Q’18 II. Diversified revenue streams

• III. Growing operating cash flow
• IV. Untapped opportunities in growth markets

V. Strong balance sheet

29

STRONG BALANCE SHEET

An operating hedge with a similar amount in dollar-denominated revenue and in dollar-denominated costs and expenses

• dollar-denominated revenue US$788 million (2017)
• dollar-denominated costs and expenses US$690 million (2017)

A balance sheet hedge with a similar amount in dollar-denominated assets and liabilities (4Q18)

• US$3.9b in total debt includes (1) USD debt, (2) capital lease obligations, (3) other notes payable
• US$4.4b in total assets includes (1) our stake in Univision; (2) cash and temporary investments

We have a very comfortable debt profile with very long maturities

• Net debt to OSI ratio: around 2.2x as of 4Q18
• Closest USD-denominated maturity: US$600 million in 2025
• Closes MXN-denominated maturity: MXN$10 billion in 2020
• Weighted average maturity: USD is 19.8 years, MXN is 7.4 years
• 4Q18 USD/MXN breakdown: 59% of debt was in USD, 41% of debt in MXN
• 4Q18 weighted average interest rates: in USD 6.05%, in MXN 7.54%
• US$211 million in interest expense (2019), all of which is hedged

Source: Grupo Televisa's public filings.

Limited FX exposure, comfortable debt profile, long maturities

OTHER RELEVANT INFORMATION

30

Contribution to OSI

1.85%

Contribution to Consolidated Sales

8.14%

Consolidated Under the “Other Businesses” line item

• Gaming: Casino sites and online lottery business. 2018 Revenues of

Ps 2.7 billion. Exploring sale of asset.

• Radio: (50% equity interest). Owned and affiliated radio stations.

2018 Revenues of Ps 920 million. Exploring sale of asset.

• Publishing: The leading Spanish-language magazine publisher in

Latin America. Recently closed unprofitable markets. Unconsolidated

• Imagina: (19% equity interest). Spanish media group Imagina.

Closed sale during 2018. Proceeds of approximately USD 341 million

• Live entertainment: (40% equity interest). The company organized

3,109 events during 2018. Exploring sale of asset.

NON-CORE ASSETS: Selling or rationalizing

Source: Grupo Televisa's public filings

31

SUSTAINABILITY: Many recent milestones

Source: Grupo Televisa's public filings

32

• Televisa included in the 2019 Bloomberg Gender-Equality Index.
• Member of the Dow Jones Sustainability MILA Pacific Alliance Index.
• One of only three Mexican companies to be included in the Dow Jones

Sustainability Emerging Markets Index.

• Part of the United Nations (UN) Global Compact, the world’s largest corporate

sustainability initiative.

• Televisa has submitted our Report for Climate Change and Water through CDP

(formerly the Carbon Disclosure Project).

• Constituent of the FTSE4Good Emerging Index.
• Members of the IPC Sustentable (Sustainability Index), of the Bolsa Mexicana de

Valores (Mexican Stock Exchange).

• Televisa’s social responsibility programs were recognized for the second time with

the “Empresa Socialmente Responsable” award.

• Our facilities Santa Fe, San Ángel and Collection Center received the Environmental

Quality Certificate issued by federal environmental entities.

• Televisa was recertified with the new version of the norm ISO 14001:2015 in three
• f our facilities: Santa Fe, San Ángel and Collection Center.

33

Investor Relations www.televisair.com + (52) 55 5261 2438

• Av. Vasco de Quiroga 2000, A4.
• Col. Santa Fe
• CP. 01210

Mexico City

Pablo Necoechea Sustainability and Analysis Coordinator pdnecoecheap@televisa.com.mx Ana Paola Montiel Investor Relations Analyst apmontiel@televisa.com.mx Carlos Madrazo VP, Head of Investor Relations cmadrazov@televisa.com.mx Santiago Casado Investor Relations Director scasado@televisa.com.mx