Release Date: November 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Grupo Clarin SA (BUE:GCLA, Financial) achieved a fiscal surplus for the first time in over a decade, indicating improved financial management.
- The company's broadcasting and programming segment showed a recovery with an EBITDA margin increase from 16.1% in Q3 2023 to 24.4% in Q3 2024.
- Cost containment measures led to a turnaround in the digital and printed publication segment's margin, improving from a negative 8.4% in Q2 2024 to 8.9% in Q3 2024.
- The central bank's efforts to improve its balance sheet and the tax amnesty program resulted in a significant increase in private sector dollar deposits, boosting reserves.
- Grupo Clarin SA (BUE:GCLA) maintained a manageable debt profile with low leverage, despite the challenging economic environment.
Negative Points
- The company experienced a 31.6% decrease in revenues in real terms for the first nine months of 2024, primarily due to lower advertising and circulation revenues.
- Net income for the period attributable to equity shareholders resulted in a loss of 10.7 billion pesos, a significant increase from the previous year's loss.
- The stabilization program negatively impacted economic activity and consumption, with an estimated economic contraction of 3.5% for the year.
- Advertising revenues, a major source of income, decreased by 40% in real terms in the first half of 2024, reflecting the challenging macroeconomic conditions.
- The digital and printed publications segment saw a 23.2% decrease in revenues in real terms in Q3 2024, driven by lower advertising and circulation revenues.
Q & A Highlights
Q: Can you provide an overview of the macroeconomic environment and its impact on Grupo Clarin's performance?
A: Samantha Olivieri, Investor Relations Officer, explained that the government implemented a stabilization program with fiscal, exchange rate, and monetary anchors, achieving a fiscal surplus for the first time in over a decade. Inflation deceleration has moderated, and the central bank improved its balance sheet. However, the stabilization program negatively impacted activity and consumption, with an estimated economic contraction of 3.5% this year but a projected growth of 5% in 2025.
Q: How did advertising revenues perform in the third quarter of 2024?
A: Advertising revenues showed signs of recovery, decreasing by 24% year-on-year in the third quarter compared to a 40% decrease in the first half of the year. This improvement was mainly in the broadcasting and programming segment, driven by better advertising revenue performance and price increases for program services.
Q: What were the key financial highlights for Grupo Clarin in the first nine months of 2024?
A: Revenues increased by 149.5% in nominal pesos but decreased by 31.6% in real terms due to lower advertising and circulation revenues. The EBITDA margin improved due to cost containment measures, and net income showed a loss of 10.7 billion pesos, primarily due to lower EBITDA in real terms and higher income tax.
Q: How did the digital and printed publications segment perform?
A: The segment turned around its negative margin, achieving an 8.9% margin in the third quarter of 2024, up from a negative 8.4% in the second quarter. This was due to cost containment efforts and a recovery in revenues, despite a challenging macroeconomic environment.
Q: What is the current debt position of Grupo Clarin?
A: As of September 2024, total debt increased by 26.2% to 27.8 billion pesos, mainly due to debt incurred to subscribe for bonds and higher short-term operating debt. Approximately 57% of the total debt is in US dollars, and the company maintains a manageable debt profile with low leverage.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
