Earnings Call: Q2 2021

Jul 28, 2021

Good morning, ladies and gentlemen, and welcome to the TF1 Group Conference Call. At this time, I would like to turn the call over to Gilles Pelisson, CEO and Philippe De Nery, CFO. Gentlemen, please go ahead. Good morning To all of you, very happy to share with you these very good results of our 1st year 2021, following a very non typical 2020. The presentation will be in 3 parts, coming back on the highlights of this 1st semester and the activity review and going over with Philippe on the financial results and then sharing the growth perspective that we see ahead of us. First of all, we have decided to adapt Our presentation and merge, the digital activity following some reorganization within the group I wish to do to bring together the ad sales activity of Unify closer To our main ad sales team, meaning for that, that the digital activities under Unifi would merge into what is now called the media part of the group, so the media entity, and renamed the whole thing Media. It's based in, 1st of all, in line of the growing synergies that we wish to have between what used to be broadcasting and It all segments reflects the organizational changes, which we announced on June 23. It also reflects the fact that in the former studio and entertainment part, with the disposal of the games allow us To move back the music activity into media. And then I guess it will give you A better visibility on Nuen's performance and expansion and especially as we move forward Expanding Nuen on an international basis, you know that they are already operating in 7 countries. So along those lines, going back to the highlights and activity review of this first Half of the year, it has been a very busy first half of the year, as you may see on this chart, with some calendar Fragmentation, started, of course, with the acquisition of Fiction House building up on Ringside Studio that we had acquired earlier. It gives us a foot For Nguyen into the UK market, and we do believe that it is very, very strategic and important to be a player in that part of Europe. Then it was the disposal of the games, Then it was the acquisition in Spain of our first studio, that is Aizen, major player in Spain with the LCID fiction series, which is on Amazon Prime, followed by Cubic, which was also a minority shareholding that we took in this Spanish studio. HPI, which has been the blockbuster In France, on TF1 with 12,400,000 viewers, and we will come back on that. That of course in mid May was the announcement of our project of merging with the M6 Group, followed by the euro, which as you know, we shared with the MCs Group in terms of broadcasting. We were if the French team was not exactly where we expected to be, nevertheless, we managed to have with the split of the games a fairly good share or lion's share in the split with 3 games of the French team, which are, of course, meaning higher ratings. Then it was our Feminine, which the whole portal was revamped and I think in a very positive manner. And then of course, at the end of June, the announcement that The A and E, the American Media Group, a subsidiary of Disney and Hertz, Would take 35 percent ownership of Real 1, which is our Canadian subsidiary specializing in TV movies and which is a very good and strong signal of trust and confidence For the future as they are also a major client of RealOne. So we are we were looking forward to this association and Coming through is really an excellent news on the Nuance part. Coming back on the media, in terms of the duration of time for the viewing. When we merged the video approach into a global approach, of course, there is the linear consumption, which Gilles remains fairly high in France at 3 hours and 45 minutes for the world population, so older than 4 years old. It is a 17 minutes addition to 'nineteen when 2020 was kind of very non typical in terms of viewership and which was, of course, Pelisson at the maximum level of 4 hours. So it's a little bit less, but nevertheless, it's a plus versus So it's very encouraging for us. Of course, on the online video side, The it is still progressing and you will see that with my TF1, we are having very good results. But nevertheless, overall, It is 52 minutes, and it's a 14 minute progression versus 'nineteen. And then when you talk about SVOD, and you know that with SALTO, we are also So very concerned with Asmode from now on. It is 2 hours and 19 minutes per subscriber. Of course, when you put it on a broader base Of the population base, it's 31 minutes, but it's nevertheless 35% increase, which means that this is Well, people are moving and especially the younger audience. Coming back on our ratings, The group is posting very strong results with as a group, for women under 50, 33.5%, which is a 1.6% increase over 2020, but more encouraging, it's 0.8% against 2019. So for us, This is really the significant the results showing how much The multichannel approach that we have picked to do at the TF1 Group is working out. By that, I mean, of course, a strong TF1, which remains, of course, the main focus of our activity, But posting 22.5% on the 1st semester, this is definitely a unique Phenomenon in Europe. As a channel, we still have 50% Advantage versus M6, which is the main private competitor. And we are fairly quite pleased with our situation at the end of first half twenty twenty one is, of course, that TMC and The FX are progressing both as you can see on this chart at 4.73.6. So these are very, very encouraging results, which we wanted to share with you this morning. And LCI, the only news channel at 1.5, which is also very encouraging. On the 25.49 Target, very good performance as well. As you see, 30.5%. This is 0 0.9 points higher than 2020, but it's also 0.9 higher than 2019. So here too, major progress boosted by TF1. TF1 at 20.6 is definitely a major player on the younger audience, which is typically not recognized in the market. TMC performing extremely well with plus 0.6 and then TSX at 2.8. Moving to what makes what is behind this success And this very high performance and exceptional performance, as you know, we have chosen to be targeting at the multi genre activity, meaning by that that we want to remain the leader, a very strong leader on news. But the bulk of our activities, of course, on prime time, what is amazing in the first half of twenty twenty one is that We posted 45 primetime over 6,000,000 viewers in France. This is a progress When you compare it to 2019 of 24 prime times more than 2019, which is just amazing. So we are very, very pleased and this is due to, of course, a little bit sports with the euro, but that came at the very end of The semester, the French fiction, and especially series like HPI, has been a booster. Entertainment with Colanta, with The Voice is very strong, has been very strong. And then, of course, our access prime time, where we So totally our access is paying off with those very good ratings. At the end of the day, what that means is that the announcers are following and kind of love it. They are gradually Coming back, as you can see on this chart, you're seeing the progress between the Q1 and the Q2 of 2021. If we were at the Q1 versus 2020 was kind of flat And you had seen that in our previous results. Of course, there was a definitely an acceleration In Q2, of course, the results of last year were very, very low, but it's a 72% acceleration In terms of broadcasting advertising revenue, let's say, the industries which are still affected at the end of the quarter are still A little bit of food, even if they are coming back, cosmetics, the car industry, which is kind of in recess. Of course, travel and tourism has not recovered at full speed, even if we are seeing more and more Advertisement as the summer came for traveling and traveling in France or traveling abroad. And then of course, health and utilities are a little bit back. But the ones which are fully recovered are retail, the telcos, Finance, cultural, leisure, beverages, textile, clothing, household, cleaning, others, meaning by others also a lot of internet activity, Pelisson. A lot of Internet player, what we call queue players, which are taking a lot of advantage of TV advertisement. Of course, our ad sales is ready to benefit from this recovery, and we are we have an ambition positioning our offers to size These opportunities, it starts with synergies in ad campaigns and we want to develop that and the new organization which facilitate Such a goal. So it is Having this offer on TF1 and UNIFY, which of course we convince further in our fight Against Google, against Facebook and digital that you can combine the best of TF1 and UNIFI Advise, which is a product, of course, recommended by a TF1 digital brand like Mommytone, but on TF1 channel, Enabling a retailer like Lido to have the best of both. It is expanding the customer base. And as you know, addressable TV has been authorized in France. We are trying to take advantage of this As much as we can, we've partnership with Orange and Bouygues Telecom, which are the first partners to With which we have developed the technological tools to facilitate it. We are very, very early in the game, But nevertheless, we are seeing the first campaign with local advertisers. And to boost the sales, We have partnered with 1 of the leading e commerce site in France, Le Goncoyne, to benefit from their sales force team and try to get to the smaller announcers that they are going after. And therefore, without initiating our own sales force, we want to capitalize on that partnership. And then finally, as we are heavily committed in terms of sustainability and wanted to be the leader in that field. Our ad sales team organized the campus, dedicated to eco responsibility. And then we took the initiative to launch an eco funding, meaning by that, that Whenever you will have in an ad the logo of A standard or something which has been verified, proved and guaranteed, I guess, by some of the certified environmental institution. Whenever this advertiser will post that in his advertisement, Meaning by that, that saying to the consumer, yes, you can trust my product, then This kind of announcement, this kind of advertising will be participating to an echo funding. So we will give Free time on our channels through advertisement to those advertisers quoting them, giving them credit for doing that. So it will be good initiative, positive, and I think it is our role as a leader to, of course, enforce that. On the ESG commitments, of course, it is at the group the art of the group strategy. We just wanted to talk to you and then emphasize The fact that we obtained a C plus rating from ISSESG achieving prime status within the media sector And then for the rest, through our conference, we are heavily committed to promote, Encourage a more sustainable and inclusive society. It is through the channel Ushuaia, which is Preserving, of course, the environment. Our news team has put together with Expertalhoyne, it means Addressing women of in society, in the corporate or in institutional world, giving them the possibility by coaching and Sponsoring them from even our anchor people like Anne Claire Coudray or Gilles Boulot, sponsoring Individually, 15 women to give them the possibility of expressing themselves on television with at ease and giving them confidence by coaching them. And then Nuen is heavily committed on having eco production in all their production and particularly having a test lab with Cruebelle Lavi, which is one of the production they do on a daily basis for France Television. Regarding My TF1, online content, We have an enlarged business model relying on solid brands and strong reach. We were happy to see that the All the work which has been done on my TF1 is now becoming a reality and getting a lot of credit. We posted an increase of 21%. Of course, very strong boost, thanks to the Of course, the good performance of some programs like HPI, La Promesa or Colanta, but meaning by that that we have also very strong Ad revenue as advertisers see, of course, the interest of having a mix Between linear, nonlinear television and going digital with my TF1, so we are posting plus 52% on 2020, which is really very encouraging. And then on the online reach, of course, Marmitton, Doctissimo keep delivering very strong Numbers at the end of the semester and then of course more and more we are encouraging editorial collaboration between for example our access prime time daily soap, Quicis Toquemans, which is in a cooking school with a program like Mommy Ton. Moving to new in studios, it's all about expansion and growth. Here, we wanted to emphasize the fact that we have been able to save some opportunities in very dynamic markets. I mentioned already the A and E shareholding into Real 1, which we do believe is a very strong plus for the future. And then of course, taking a solid position in the Spanish speaking world, as you know, since Casa de Papel and what Netflix has been doing Spain, I think everybody has become aware of the potential of Spanish production houses. We wanted to have to set foot in Spain and it is done through Ryzen and through Cubic. So we are very, very excited about This association, at the end of the day, it means that international revenues represent already 40% of the total of Nuen, Meaning, knowing that in France, we have also part of the sales team, which makes the French revenues a little bit higher. But we our goal is to go fifty-fifty on between international and France. Of course, the name of the game on looking forward is partnering with platforms on high value added formats. We see new opportunities in France, in the UK, Spain and Belgium. In the UK, with Ringside Studio and Gov Nils, who came from Endymond In association with the French producer, Leonis Production, we were able to Convince Apple TV plus to give to Nguyen The first production that they are doing in Europe between France and England called Liaison with Vincent Cassel and Evergreen. So it will be a very high profile. It's a mini series and Perisson. We do believe that it's a very significant move from UN in the international scene as a major producer. With Netflix, 2 significant projects, 1 through our Dutch speaking Belgium studio, The Mensen with diamonds, which will be all about what is going on in the diamond world in Annwerpen And very nice series, which is an 8 part crime drama, which will be launched on Netflix. And then Insiders, which is iZEN, so the Spanish new entity, obtaining this reality show in kind of a Big Brother style. This is what's going on, on this First half of the year through our various activities. And I will now give the floor to Gillette for the financial results. Thank you, Gilles. I will start By giving a few more explanation regarding our presentation, for which you have a detailed Perisson. On the slide and on our website as well. As Gil has already explained, this new Pelisson. Reflects growing synergies between television and digital activities. Our TV and digital business today operate In the converging market, on the commercial side, we have developed combined offers for our advertisers, which for most part of them The same between our channel and our website. Market measures and sales are also gradually converging. And in addition, I would say that data offers for TV spots are a good example of technological cooperation between our two businesses. In terms of content, we see a lot of potential to share our programs and maximize traffic As it has already been the case between Marmitton and TF1 with EC2 Comanche or Doctissimo and TF1 on this specific segment. By combining our TV and digital business into a new media Sector with us make way to create even more value and more synergies for our clients. Other reallocation of business to better reflect internal touch point and governance, music and entertainment activities Are also integrated in the media sector. And as a result, Nuance Studios' performance will be made more visible. Since 2016, we have developed our Production and Distribution business segment, namely through acquisition of Studio Abroad. Today, this business is present in 7 countries and shows a lot of potential, Both from a synergistic point of view as our different studios are working together more and more and cooperate, But also from a business point of view with the growing partnership with SVOD platform. Our new sector presentation will help better reflect this. More especially, from this semester onwards, all figures will be presented according to those 2 sectors. The first one, Media, will include revenues from our TV and digital business. For this segment, Digital and ad revenues will be identified within total advertising revenues and other revenues will include revenues From Services, Distribution, Music, Events, Licensing and Social E Commerce. For the second one, Nuance Studios will provide detailed figures for France and international revenues. As a way to facilitate your analysis, 2020 pro form a data will be provided in our 2021 financial statements. Now moving to our results. I will start commenting on the H1 21 to 2021 revenues for the TF1 Group. Consolidated revenues of TF1 Group To stand at EUR 1,128,700,000, up by EUR 245,000,000 year on year, close to the level of 2019. Revenues for the Media segment are up by 198 €1,000,000 year on year. It reflects a 30.5% increase in advertising revenues. That's €187,400,000 year on year. This figure benefits From a favorable basis of comparison versus last year, which was marked by the impact of the first lockdown. Some sectors such as leisure, culture or clothing have come back. They even increased their spending versus 2019. Digital ad revenues are up by €10,400,000 due to increased revenues from the replay platform MyTF 1, which delivered a very good performance, as Gilles has already explained, during this first half year. Website ad revenues are slightly down versus last year due to limited performance On our international business, ad revenues are up on the French market. The other revenues within the media segment Our up by €11,000,000 This comes from a better activity versus last year in advertising services such as Econ and Gamnet as well as growing revenues from our e commerce offers. Interactivity is flat with a high basis of comparison last year in the context of lockdown. Moving on to Nuance Studio. Revenues are up by €46,900,000 year on year. During the first half year twenty twenty, activity was impacted, as you remember, by the interruption of shooting. New and studio activity benefited this semester from a favorable basis of comparison and higher deliveries. International revenues stand at €56,500,000 up by 54% versus last year. In the context of growing revenues, Nuance International activities has stood up its share of 40% of total revenues of this segment. Regarding programming costs for H1-twenty 21, they amounted to €466,000,000 versus €355,000,000 in H1-twenty 20. They are up by €111,000,000 versus last year. As we had the opportunity to express before, We have started investing again in H1 'twenty one in order to increase our ratings and create value for our advertisers. Programming costs are thus back to 2019 level when they stood at close to EUR 460,000,000. To give you more details, we broadcasted some French soccer team games in H1 as well as the Euro Football 'twenty for a total cost of $40,000,000 compared to no significant spot cost last year when competitions were postponed due to the COVID. In order to benefit from the demand on the ad market, We and to increase our rating, we have also invested in French series in H1 such as HBI, Grand Plasand, Oujette de Promet. And this led to a cost increase of $50,000,000 versus last year, some of which comes from higher depreciation in line with more deliveries versus last year and even more delivery compared to what we normally have during the 6 1st months of the year. Current operating profit amount to €269,000,000 up by €101,000,000 €69,000,000 UP BY 101,000,000 Leading TO A Margin Rate of 15% Showing the group ability to bounce back from the COVID-nineteen crisis. It is in line with the H1 or 2019 level of profitability. If we now look into the different segments. The current operating profit for the Media segment stands €147,000,000 up by €76,600,000 year on year, leading to a current operating margin rate of 15%. The margin rate is up by 6 points versus last year. The current operating profit for the Media segment takes into account $21,000,000 amount of one off tax benefit, but which has the counterpart in our P and L for an amount of amortization and depreciation, as already mentioned, which is higher than normally. There we have more than €50,000,000 increase compared to last year or even on 2019 on a one off Level of delivery of French drama during those 6 months since we kept investing last year in production in 2020. New and Studio posted a current operating profit of €21,700,000, up by €24,700,000 year on year and the current operating margin rate of 15%, which reflects the In person, which reflects the resumption of new end activity after the interruption of shooting during H1 last year. On the consolidated income statement, I've already commented on the consolidated revenues and the cost of programs and the current operating profit per segment. Other charges, depreciation, amortization and provision are up by €33,000,000 in H1, explained by non current savings on general expenses due to COVID-nineteen last year and a high level of depreciation amortization as already explained. Non recurrent expenses linked with the TF1 M6 merger project are recognized in our accounts for an amount of €2,400,000 for this first half year. Share of losses of associates Stands at €13,400,000 down by €12,000,000 explained by the investments in the SOUTHO platform. The net profit attributable to the group stands positive at €108,000,000 for H1 of 2021 Up by €70,000,000 in line with the increase of the revenues and the current operating profits. On the balance sheet, nothing very special to comment at the group level at the end of June 2021. Shareholders' equity attributable to the group Was €1,626,000,000 at end of June 2021 out of a balance sheet total of 3,540,000,000. The group reported a net cash positive of €34,000,000 at end of June 2021. And as you know, the group has a sound financial position with low debt and access to available bilateral credit facilities around 1,000,000,000. If we look at the trend in the cash position during this half year, Closing net debt stand as already mentioned, euros 34,000,000 at the end of June. The operating cash flow is up by $300,000,000 which reflects the improvement of our business Perisson and our results in H12021 compared to H120. The negative figure of EUR 63,000,000 And our change in operating working capital is mainly linked with the increase in trade receivable due to a higher level of activity and higher inventories in the New End Studios segment. The level of net capital expenditure is up by EUR 8,000,000 explained mainly by higher investment in Newen linked with the increase in the activity in H1 as usual and the development of the production. The level of Sarto shareholders' loans and dividends is down by EUR 66,700,000 mainly linked to the 2020 dividends payment of €94,000,000 €95,000,000 and a reduction of shareholder loans level. We'll pass the floor to Gilles, who will give more flavor on the 2021 full year perspective. Thank you, Philippe. Yes, following this very good and strong results from the first half, we believe that, Pelisson. Especially for the last quarter, the best remains to come. We have a very powerful back to scoop lineup, both in fiction and entertainment. Starting with entertainment, You we will have a very special end of the year with The Voice, with an all star casting, which should generate a lot of interest. Kolanta was the legend where we brought back some of the participants, the best one For over the last 20 participations, Masinger will come back. After 2 years not being on the screen, With the Star will be back and then we will celebrate also the 20 years of Star Academy through a couple of prime times. So this will be combined with a very strong lineup In terms of societal and contemporary fiction, it is very important for us, as you know, to Feature issues, not only committees and you have a couple of committees here like Laurent Plascon, which is A professor fairly cranky to replacing for a while You know, a full professor in a gymnasium and creating a lot of problem with Joystar, which is one of the Major actor in that kind of range, so very interesting proposition. The first season went very well the first unit was very well accepted. So we are coming back with some new additions. Belle, Belle, Belle will be also the French adaptation of a U. S. Comedy, I Feel Pretty, which We expect a lot. And then some more societal commitments. One is Ille Elle, which is about a drama about the story of a young boy who feels like a girl in a male body and the evolution during his teenage years and of course how his parents may react to his announcement and to his willingness to change Saks. Gil Parison. We are trying to feature those issues on new territories. It has been very successful in the past, and we do believe that that's one way of maintaining our leadership. On the all news channel LCI, as we saw that C News was, of course, progressing in France throughout the year 2020 2021, necessity to revamp LCI, with a new dynamic, we reinforced the programming structure. We have new morning show. We will have a new access and prime time show With new journalists coming from BFM, from various parts of the television spectrum And then new visual identity, new studio, so all combined, I think, we will be ready for the presidential race, which, of course, will officially start. It has already a little bit started with a few announcement, but we want to be part of that game and be a major player in it. And of course, this starts as early as September 2021. Revamping of the first So that we put in Access Primetime, the man was a partien already 4 years ago. So with new sets, New characters, new cast, a new theme song with Vianney, who is a young French singer, well known to the younger public. So I think all in all, here too, we will capitalize on the Success of EC 2 Commence, which is the 2nd soap that we introduced 2 years ago and Give a new dynamic to Domayne Louisa Partien. In terms of growth perspective, looking forward, On the media side, it's all about strengthening our total video approach, both in content and of course, marketing with You know, a lot of offers in terms of streaming, developing synergies and creating value as you saw between the linear and the digital activities And capitalizing on unique content like the fiction I mentioned, you see a few of them, Le Nafir Frances, which has a movie casting, which will be an 8 episode story, which will be presented in September, October, and then some feature movies like Le Grandma. New in studio is, of course, an increasing share of the coming from international players, clients, platforms and significant increase of the bookmakers of the clients. So with that, what we wanted, of course, to commit to with Philippe and the team was that in 2021, following the 15% margin on the first half, committing to having, of course, a double digit Current operating profit margin for the entire year, which is coming back to 2019 level where we had made it has taken a few years to bring back TF1 at that level. Finally, one word on the proposed merger. As you know, we are in the middle of it now, Pelisson. Initiating the process once the announcement was made, of course, the ambition is very much at the top to make the process happen and a successful one. The whole idea of this being to that the new Video Group is ready to master the challenges of the total video market, benefiting to all viewers And especially the French audiovisual industry, we just signed a major agreement at the TF1 Group with the French producers in movies. So this is capitalizing on our knowledge of the industry and the good relationship We have with them strong commitment to creativity, diversity, pluralism of opinion regarding, of course, news team promoting French And European culture, which we think is important given the legacy that we have on in the French history. A French streaming champion combining, of course, catch up and you have seen that with my TF1, but of course, Sysplay is very strong on the M6 side and live streaming offer and SVOD offer. The closing is expected as we had Announced earlier at the end of 2022, so it's a very long process unfortunately, but that's the way it's done in France and there is nothing we can do about it. And of course, it is just Our collaboration with the French authorities such as the antitrust authorities and the CSA, Pelisson, which will allow the process to take place in the best possible situation. And of course, the good news was that on July 8, both Bouygues and RTL, the 2 major shareholders were able to announce the signing of the agreement after the approval of our mutual Employee representative bodies, whether it was at Bouygues or TF1 or M6. So this being said, I think we are ready now to answer your questions. Thank you. Thank you. Ladies and gentlemen, we will now begin our Q and A session. We have a first question from Annika Maas from Exane BNP Paribas. Please go ahead. Good morning. So first of all, it would be great if we To get a bit more detail around the TV advertising performance in June sorry, in July, August and what you know so far. Secondly, you suggested that H1 in studios performed among others quite well because of early deliveries. Do we I assume from that that maybe H2 might be slightly weaker. Dan, you've gave the slide where you showed which Taxes have recovered. I'd be quite keen to see what share of your advertisers is now made up by e commerce firms. And then finally, you suggested that in addressable TV, it's mostly local advertisers that have used And the function so far, first of all, can you maybe tell us a bit more about these advertisers? And also do you have any stats or Return on investment KPIs to show us how addressable TP has delivered so far. Thank you. So the first question on July August, we see these are small months for us, But we see because we are at the end of it, a good month of July and the month of August where the comparable is a little bit stronger because we had a strong month of last year in August Pelisson. For a lot of reasons, but it's also in a good trend, less visibility, of course, on September. But as we see the economy coming back and as I mentioned earlier, Most announcers coming back, especially the consumer goods announcers, we feel fairly confident on the end of the year. The second question was the Studio performance in H2. You want to comment? Well, I would say that in H1, we had a very good performance, but that should go on in H2. 2, activity for the Studios segment It's good and the demand is quite strong. We have a level of book of order which stand at a high level, 1500 hours for the book of orders. So we expect this performance to go on for the whole year. Regarding your third questions, I think that the pure player, as we call them, advertising clients represent Around 10% of the total revenues basically. So in terms of range, that's and they are up for the last 18 months in terms of what they invest. And I think that You had another question. It was on addressable TV, I guess. If I understood well, your question was about more knowing more about the local at the time. It's very early in the game. So it's we have about 60 campaigns, I think, which have been put together. Leboncoin is, of course, enabling us will be able it hasn't started yet, so it will enable us to accelerate. We see both national announcers wanted to test it and then local advertisers going for it because It enables you to create regional advertisement, more targeted by definition advertisement. And as we see more and more with Orange as a distributor and Bouygues Telecom coming on board, I think we will know more in a few months, but at this stage, it's very early. And regarding your question in terms of sectors, which What we recovered as compared to Q1, I would say that during Q2, we had specifically, of course, the culture and leisure. The 2 sectors are coming back, which is a good news, even limited. Nevertheless, they were Still affected in Q1 and we see them in Q2 as well as all the clothing textile sector, Which is back, which is as well improving as compared to Q1. Okay. Thank you very much. Thank you. We have a next question from Conor O'Shea from Kepler Cheuvreux. Please go ahead. Yes. Thank you for taking my questions. Good morning, everybody. So yes, three questions. Maybe if you just come back on the previous question on the Q3. I think last Q3, you did more than 8% Advertising Growth. Just could you remind us roughly how that 8% was A portion between, say, July, August, September was a big step up in growth in September, which would make this year's comp In September, much more difficult. Then the second question is on programming costs. Just see if you could have some thoughts about full year program costs. Now that we're halfway through the year, what do you think what are your latest thoughts There are. And then just a last question on Saltoo. Do you just have some any chance of having a few more KPIs are how it's going in terms of traction with subscribers and so on and what your sort of thoughts are 6 or 9 months into after launch. Thank you. Regarding your first question, Last year, the 8.5% growth was more on August September. August always never was very important, but in terms of percentage, that was more end of the quarter And beginning of the quarter, maybe the comparison. Now concerning the programming cost, I would say that you may be a bit disappointed linked with the programming cost To level of H1, but I just want to remind you and insist on the fact that is mainly due to the fact that we had More deliveries that normally we have at the end of H1 and that create in our programming costs mainly due to French Drama and high level of French drama we have in our inventories and rights And of course, broadcasting more French drama than others. I would say that is mainly due to amortization and depreciation. But programming costs are under control. It's due to a very one off situation. And as we have already mentioned, we would should deliver a global programming cost Between $900,000,000 $985,000,000 where the average will probably be depending on the high Demand on advertising for during this the year and especially during the last 4 months of the year. So we'll adjust our investment September October November depending on the demand and the necessity to increase inventories and good ratings when the demand on the advertising market will be there. So we will adjust depending on the situation the last 3, 4 months of the year, but we remain with the same kind of Control on programming costs and take into account the one off situation due to the fact that we have investors in 2020, even during the crisis, as in order to support this sector And especially for the French drama. And we have the consequence on the P and L during H1. Parison. On Santo, what we may say is maybe that we are well on track with Pelisson. I guess, as a shareholder, we expected from Sarto being playing this role of a platform Offering our content in a premier situation, which meaning that when we see HPI or La Promesa or other fiction, French fiction that we are proposing to the public. You will have it 30 days in advance of the broadcast on TF1. And so this is a Terrific offer, very different, of course, from any of the American platforms. So this means a lot to us As it means additional acquisition possibilities and rights, when you we look now At the full value of acquiring an IP, being able to allocate some of the value to SALTO. So I think the 3 shareholders are very much on that line. The viewership, duration of viewership is very much in line Over 2 hours per subscribers with what the international platforms are doing. And then little by little, we are looking at the expansion of SALTO, the distribution, etcetera. But we will let SALTO communicate rather than us on whatever has not been Pelisson. On whatever has not been communicated. Okay, understood. Thank you. Thank you. We have a following question from Christophe Charlon from Societe Generale. Please go ahead. Yes. Good morning. Three questions on my side. First was on advertising. What was the mix between volume and pricing in H1 and Q2? To you have indicated that TV viewing time was up, I think, 7%, 8%, so that seems to suggest it was mostly volume. And related to that, what do you expect post the pandemic in terms of TV viewing time? And does that mean that as volume go down and eyeballs go down, you will have to Raise prices and do you think that do you think you are in a position to do that? The second one was on the state Aid. I just want to make sure I understand the mechanic. So the €21,000,000 is booked as other income and that's Totally offsetting depreciation, which is in programming costs, if I understand correctly, but I just wanted to confirm. Is there more to come in H2? And lastly, is it tax free? So is the state taxing, it's aid? And the last one was on Philippe has answered that, but I want to make sure I understand. On new end margin, 15% was very good in H1. Is that a sustainable level for the full year and for the next few years? Thank you. Well, on the first question, during H1, we have recaptured some value In terms of pricing and mix, with a strong performance An high level of ratings, which give us opportunity to sell on spot by spot and at the Level of pricing, which is linked with the good ratings and especially on prime time. So in terms of volume price, I would say that in Q2 and especially in Q2, we have been in capacity because of the rating and the high level of ratings to price a better price than usual. So we recapture some value in to 2. Concerning the state tax benefit, I would say that We are not saying that €21,000,000 is completely or Put a counterpart of the amortization level. But just to give sense, we had benefit from Tax credit, which is tax free, which is based on the fact that We had a loss in our revenues of more than 10% last year. As you know, The decision and the decree finally came out in April this year, even if it has been discussed during the whole 20 20 year. And I'm just saying that the counterpart of it is the fact that we have supported The sector in 2020 and as a consequence having invested in 2020, we have deliveries this year, which has some impact on amortization and depreciation. The level of amortization and depreciation is Q2 In Q2 as compared to last year, it's around €50,000,000 if you take our P and L in details. So basically, It's not really a compensation. And at the end, we benefit from the programs. But in terms of comparison, I'm just saying that is the balance with the Benefit of this tax we have and that will be and the benefit of this tax is taken accordingly to What we broadcast in terms of content according to the rules. So there will be an additional amount, but very limited During the second half of the year, because we have not completely broadcasted what we on what we have invested last year. So there will be an additional amount for a limited few 1,000,000 in H2. Regarding your question of 15% sustainability, I mean, Joseph, you know very well TF1 for long and you know that usually and historically Q3 was Loss making, we've made some change during the last few years and now we are still profitable even if the margin in Q3 It's limited because of the nature of the business and because of the limited amount and limited demand in July April In July August, sorry, during summer. So we probably will be more in line with what we have delivered in 2019 In terms of profitability, then what we have delivered during H1, which is a traditional for TF1 for the last few years. Now in terms of sustainability on the long term, I will not comment on it. I would say that what we have is in mind is that to remain now onwards with a double digit profitability, not only 2021, but onwards. My last question was actually just specifically on UN, which had a 15% margin, so that was on UN. And I think you did not answer on the pre pandemic normalization of audiences to pre pandemic level. If and when that happens, volume will go down. So do you will have will you have to raise prices as of, I don't know, 22 or 23. And do you think that you're in a position to do that? Well, regarding new end profitability, 15% is a high level of profitability for a production Company, I think we are more between 10% to 15%. Nevertheless, We expect to keep a high level of probability Due to the level of demand in this sector, so 15% profitability For this activity, it's probably higher level we can expect in a normative basis. Concerning pricing, maybe on the pricing, I think the beauty of our current System is that we have a dynamic pricing, which is very much a yield management pricing scheme, Meaning by that, that even if we have some guaranteed commitment from advertisers, some major advertisers At the beginning of the year, giving them some specific prices, We are able to monitor those prices during the year based on demand. So It is a very dynamic and evolutive pricing throughout the year. So regarding It is a balance not only between viewing the duration of viewership, but it's most importantly what the ratings we deliver. And as long as we are very much into this dynamic of delivering very strong ratings on entertainment, on fiction, On news, I think we have the possibility of keeping that dynamic and the CEO management Going on for the coming quarters. And just to add, I think that we have to leverage not only or specifically increasing price, but we have to leverage In order to take into account the viewing and the level of absolute value of ratings, First is to mix the and the mix to part of the day and to be very strong on access and prime time And to deliver valuable inventories, which are sold at a price, which is of course higher than the day part of the day at normal day part. So meaning that we may and we have the possibility to leverage value through the ratings specifically on specific part of the day. And second point is that as we have improved the way we sell our inventories Between what we call spot by spot and rating guarantee. And so that's also on TF1 A way to leverage the value for advertisers as a counterpart of the pricing which could be up, But which create more value because of the nature of the inventories. Thank you. Thank you. We have a next question from Thomas Koudry from Bryan Carney. Please go ahead. Apologies, Mr. Coulee just hung up. For the moment, we have no other questions. Gil Okay. Well, if there is no more question, we just I have to wish you a very good summer and holidays. And if you need any specific useful question information, the team is available. Well, thank you for attending this call. Thank you. Thank you again, and have a good summer. Bye bye. Thank you very much. Ladies and gentlemen, this concludes today's web conference. Thank you all for your participation. You may now disconnect.