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Central European Media Enterprises (CETV)
Q3 2010 Earnings Call
October 27, 2010 09:00 am ET
Romana Wyllie - VP of Corporate Communications
Adrian Sarbu - President & CEO
David Sach - CFO
Anthony Chhoy - SVP, Strategic Planning & Operations
Petr Dvorak - SVP, Broadcasting, CME
Vijay Singh - Janco Partners
David Kestenbaum - Morgan Joseph
Ben Mogil – Stifel Nicolaus
Leszek Iwaszko - KBC Securities
Sasha Balasnin - Goldman Sachs
Andrzej Knigawka - ING
Ankur Agarwal - Nomura
Vivek Khanna - Deutsche Bank
Gavin McKeown - Pioneer Investments
Previous Statements by CETV
» Central European Media Enterprises Ltd. Q2 2010 Earnings Call Transcript
» Central European Media Enterprises Ltd. Q4 2009 Earnings Call Transcript
» Central European Media Enterprises Ltd. Q3 2009 Earnings Conference Call
» Central European Media Enterprises Ltd Q2 2009 Earnings Call Transcript
Good morning, good afternoon to each of you and welcome to CEM’s third quarter 2010 investor conference call. We are broadcasting our earnings call via a video webcast to enable you to see the management team in action. You can join us via the link on our homepage www.cetv/net.com. there you can also download the presentation slides which we will refer to during this call. You can find them on our homepage at the bottom left corner. The participants of today’s call will be CEM’s president and Chief Executive Officer Adrian Sarbu, Chief Financial Officer David Sach and Anthony Chhoy, Senior Vice President, Strategic Planning & Operations; Petr Dvorak, Senior Vice President, Broadcasting. And joining us on the phone call we have our General Counsel, Daniel Penn.
Before I turn to Adrian let me read the usual Safe Harbor Statement. Our presentation today will contain forward-looking statements. For this statements, we claim the protection of the Safe Harbor contained in the U.S. Private Securities Litigation Reform Act of 1995, and refer you to the forward-looking statements section in our Form 10-Q filed with the Securities and Exchange Commission earlier today for a list of such statements and the factors, which could cause future results to differ from those presented in this call.
During this call, we will refer to certain financial information that is not in U.S. GAAP. Please see the appendix to the presentation for reconciliation to U.S. GAAP financial. In addition our segment financial information that is presented in local currency is not in US GAAP. We don’t provide reconciliation to this number as the US GAAP amounts are expressed in US dollar in our financial statement. Additional information on our segment data is provide in note 16 through our financial statements on page 32 of our. And now over to Adrian.
Good afternoon or good morning. It is a funny day here in progress but almost three years our advertising markets have been clouded. Despite adverse condition we stayed firm on our strategic to evolve from broadcaster to a vertical integrated media company. We solely the focused on the EU and new work section market, we brought the leading channels in Bulgaria and the integrated media for entertainment making CEM the largest content provider in the range.
I’m pleased to say that this strategic is working, our result today are stronger. One year ago our reported EBITDA was minus $14.4 million. In the third quarter 2010 our OIBDA increased by almost $10 million. The recently financing has improved our liquidity position and we have started to repurchase that opportunity. We have built four pillars for our future, audience leadership, market share leadership, operating leverage and from liquidity. As our market are expected to improve next year this will enable us to increase cash generation and further reduce growth debt and interest cost.
With recovering continuing in the Czech Republic, Romania and Croatia in the fourth quarter we are on track to deliver full year OIBDA guidance of 100 to $115 million. During the busy last few months, we received from you many questions about the short term and medium term future of our TV advertising market. We think it is improving. The folio is not only our strongest season but the moment when I start negotiation with advertiser for next year. Our key focus on the restoring price to 2008 levels, this will be a key step in growing our business. Now over to David, we will give you an overview of quarter three macroeconomic indicators and our consolidated performance.
Thank you Adrian. We are closing monitoring the key macroeconomic for our operations. GDP prior to consumption consume confidence and the TV ad market of the statistic most relevant to our business. Overall you will see continuous improvement year-over-year in this statistic. Please turn to slide five, GDP improved year-over-year in all our markets driven by exports and industrial production particularly in the Czech Republic, Slovakia and Slovenia however private consumption and consumer confidence the indicators that drive advertiser investment continue to lag behind GDP growth. The Czech Republic and Slovenia saw miles TV ad market growth in the third quarter as a result of moderate growth in consumption level. In Slovakia the TV advertising market improved from the 5% decline in Q2 driven by positive consumption but still stays slightly negative due to continuing high level of unemployment.