Xilam 2023 Full-Year Results: A Successful Financial Year With Enhanced Assets
Total sales up 11%
Group net income almost fourfold to EUR4.9M
Free cash flow doubled to EUR12.6M
Net financial debt halved
Solid foundations for the future
PARIS--(BUSINESS WIRE)--April 04, 2024--
Regulatory News:
Xilam Animation (Paris:XIL), an independent animation production and distribution company, announces its financial results for the year ended 31 December 2023, reviewed by the Board of Directors at its meeting on 3 April 2024 chaired by Marc du Pontavice.
Marc du Pontavice, Chairman and CEO of Xilam, comments: "2023 is evidence of the Group's ability to anticipate and adapt to market changes, by adjusting both its strategic vision and its business model. While consolidating its ability to generate profitable growth, and creating assets with high long-term value, Xilam has also demonstrated that its new strategy, implemented since 2022, is also designed to generate significant free cash flow. In 2023, this reached a record EUR12.6M, giving a year-end net cash position of EUR3.8M. We therefore proved that in a deteriorated market environment, we can rely on a very solid business model, a healthy balance sheet and, above all, on the studio's creativity and expertise, the breadth of our content offering and the diversity of our clients".
Income statement ('000 euros) 31.12.2023 (1) 31.12.2022 % change
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Sales of new productions and
developments 30,560 25,358 +21%
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Catalogue sales 9,166 10,356 -11%
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Total sales 39,726 35,714 +11%
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Grants (2) 6,006 6,299 -5%
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Total sales and grants 45,732 42,013 +9%
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Other current operating revenue
(including ATC) 2,482 4,706 -47%
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Total operating revenue 48,214 46,719 +3%
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Operating expenses (43,109) (44,252) -3%
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Current operating income 5,105 2,467 +107%
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% Sales and grants 11.2% 5.9%
Operating income 4,923 2,221 +122%
% Sales and grants 10.8% 5.3%
Financial income and expenses (476) (1,559) ns
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Group consolidated net income 4,860 1,345 +261%
% Sales and grants 10.6% 3.2%
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(1) Unaudited data
(2) Excluding audiovisual tax credit $(ATC.AU)$
Xilam's new strategy, implemented since 2022, is a success
Anticipating the slowdown in the proprietary production model in the kids segment, and the consequences of the macroeconomic context in terms of cash management, the Group has rapidly and successfully changed its business model by implementing a production strategy that is more balanced between servicing (notably via the young-adult segment) and proprietary productions, so as to generate a significant free cash flow while continuing to enrich its catalogue. Both sales and earnings for 2023 already reflect the relevance of this strategy.
Double-digit sales growth for the seventh consecutive year (excluding Covid) to EUR39.7M
This performance is the result of very strong growth in servicing and a very good performance from catalogue sales:
-- Sales of new productions and developments amounted to EUR30.6M, up 21%,
of which 26% for Xilam alone, excluding Cube. It was largely driven by
growth in servicing (non-proprietary productions), which rose by 76%.
-- Catalogue sales are the second best in Xilam's history. While slightly
down compared to 2022, they are 43% higher than in 2021, confirming the
momentum of the Group's franchises and reaching a new plateau of around
EUR10M.
After taking into account grants and other ordinary operating revenue, total operating revenue came to EUR48.2M, up 3%.
Current operating income of EUR5.1M, a very good performance at a time of strategic evolution
Current operating income amounts to EUR5.1M, giving a margin of 11.2% on sales and grants. It more than doubles compared to 2022, which was strongly impacted by a catalogue write-down.
This profitability in 2023 reflects the Group's strategic orientations, in particular: i) structural investments to prepare for future growth, in particular in the buoyant young-adult segment, ii) the high proportion of servicing in sales, which does not allow to capitalize the increase in fixed costs, iii) the priority given to cash generation and debt reduction.
Net profit of EUR4.9M, almost four times higher than in 2022
Owing in particular to the Group's strong debt reduction in 2023, financial expenses were divided by three, representing an expense of EUR0.5m, compared with EUR1.5m in 2022.
Income tax was a positive EUR0.8M.
As a result, net profit will rise to EUR4.9M from EUR1.3M in 2022, an almost fourfold increase.
Xilam has succeeded in evolving its business model, resulting in a strong free cash flow generation of EUR12.6m.
In 2023, the Group has thus generated free cash flow of EUR12.6M, doubled compared with 2022. This strong improvement is largely due to:
-- A stable net cash flow from operating activities at EUR31.7M.
-- A 21% reduction in acquisitions of tangible and intangible fixed assets
to EUR19.7M (compared with EUR25.1M in 2022), due in particular to the
lower share of proprietary productions.
Xilam strengthens its balance sheet by halving its net financial debt
After taking into account the repayment of rental debts and interest paid, net cash generation amounts to EUR8.6M, leading to a sharp reduction in net financial debt at 31 December 2023 to EUR7.3M, compared with EUR15.9M at the end of December 2022.
(In thousands of euros) 31.12.2023(1) 31.12.2022 --------------------------------------- ------------- ---------- Cash and cash equivalents 8,139 13,255 Corporate financial liabilitiest (2) (4,377) (15,738) Net cash 3,762 (2,483) Self-liquidating financial liabilities (11,053) (13,405) Net financial debt (7,291) (15,888) --------------------------------------- ------------- ----------
(1) Unaudited data
(2) Non-self-liquidating financial liabilities
This net financial debt breaks down into:
-- Net cash, excluding self-liquidating liabilities, of EUR3.8M, an
improvement of EUR6.2M since the end of 2022 which takes into account
corporate financial liabilities of EUR4.4M compared with EUR15.7M in
2022. In particular, the Group repaid its EUR15M EuroPP in 2023.
-- Self-liquidating financial liabilities of EUR11.0M (compared with
EUR13.4M), down by EUR2.4M due to the payment of receivables from major
international platforms.
In January 2024, the Group also carried out a capital increase of EUR3.7M, strengthening its equity and increasing its liquidity.
At 31 December 2023, total equity stood at EUR74.1M (compared with EUR69.5M at the end of 2022). Pro-forma for the capital increase, total equity would be EUR77.8M at the end of 2023.
Social and environmental responsibility: a very encouraging first carbon footprint
Founded on the values of excellence, innovation, diversity and inclusion since its creation, Xilam Group is resolutely committed in 2023 to integrating the energy transition into the heart of its activities and to reinforcing, formalising and communicating its commitments in terms of Corporate Social Responsibility $(CSR)$.
In 2023, the Group published its first Carbon Footprint (see press release of 31.01.2024), which shows that carbon consumption per employee (FTE) is 3.9 T of CO2, half that observed in the media sector. Based on this initial observation, in 2023 the company adopted new practices that constitute a significant step towards more eco-responsible management of its activities. As part of its structured and formalised sustainable development strategy, the Group has introduced a responsible purchasing policy, invested in more ecofriendly technologies, improved its production processes, reduced and optimised its data and storage volumes, extended the lifespan of its equipment and introduced awareness-raising initiatives within its teams. All these measures will be detailed in the Annual Financial Report 2023.
Agility and solid foundations, to deliver a strategy based on Xilam's powerful assets
Since the announcement of the contraction in investment in the kids' segment by the major streaming platforms in the second half of 2023, Xilam has been quick to adapt both its cost structure and its strategy.
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