Grupo Televisa (TELEVISACPO) Q2 2024 earnings summary

Executive summary

• Revenue declined 5.8% year-over-year to Ps.15,763 million, mainly due to a 13.3% drop at Sky; operating segment income fell 7.7% to Ps.5,950 million, with a 37.7% margin.

• Corporate restructuring and integration of Sky and cable operations improved profitability, with ongoing efficiency measures and OPEX synergies targeting MXN 400 million in quarterly savings from Q3 2024.

• Acquisition of AT&T's stake in Sky completed in June 2024, making Televisa the sole owner and enabling integration and synergy realization.

• The spinoff of Ollamani was completed, unlocking shareholder value and simplifying the asset structure.

• Direct-to-consumer (DTC) business ViX is on track to achieve profitability in the second half of 2024, with user growth, engagement, and reduced churn.

Financial highlights

• Operating cash flow (OCF) rose 37.8% in Q2 2024 to Ps.4.2 billion, with a 26.6% margin; OCF for H1 2024 exceeded MXN 6.4 billion, up nearly 50% year-on-year.

• Segment revenue was MXN 15.8 billion, down 5.8% year-on-year; operating segment income was MXN 6.0 billion, down 7.7%.

• Corporate expenses decreased 45% year-on-year, mainly due to lower share-based compensation.

• Finance expense, net, decreased by Ps.240.3 million (28.9%) to Ps.590.0 million, driven by lower debt and higher interest income.

• Share of income from associates and joint ventures increased by Ps.313.5 million, mainly from Televisa Univision.

Outlook and guidance

• Organic operating cash flow for the cable segment is expected to increase by around 16% year-on-year in 2024.

• 2024 CAPEX budget cut to $720 million, including $590 million for cable (with $30 million for Acapulco reconstruction), $120 million for Sky, and $10 million for corporate.

• Targeting a 20% operating cash flow margin in the medium term.

• Expecting robust political advertising to boost top-line growth in H2 2024 and a return to consolidated EBITDA growth for the full year.

• Sky aims to reactivate commercial strategy in H2 2024 after integrating product portfolio and sales channels.