2015 - ADLPerformance · through our know-how with confidence in new high-growth markets. ......

0 | ADLPartner | Rapport financier annuel 2015

Disclaimer: This document is a free translation of and extract from the original French Financial Annual Report for 2015 and the French consolidated financial statements. Only the French version is legally binding. A copy of the full Annual Report for 2015 (in French) or the consolidated financial statements (in French) may be obtained inter alia either on ADLPartner’s

website (www.adlpartner.com), or on request by calling +33(0)1 41 58 72 03 or emailing [email protected].

2015 Annual Report | 1

MESSAGE FROM THE CHAIRMAN

Dear Shareholders,

The ADLPartner Group is developing in line with its long-term strategy

focused on creating value and capitalizing on its marketing expertise.

In 2015, in our traditional business lines, we have continued moving forward

with our policy for trade-offs focusing in priority on open-ended subscriptions.

By optimizing our prospecting methods, further strengthening our offers and

developing our new marketing mix, launched in 2014, we have been able to

support growth in our open-ended subscription portfolio, up 3.6% at end-

2015 to almost 3.2 million units.

Alongside this, our range of marketing services has continued to develop. To

consolidate their potential, we have further strengthened their structure and

visibility with the launch of ADLPerformance at the start of 2016. This new

BtoB commercial brand will enable us to capitalize on our proven expertise in

terms of the implementation of relational marketing operations and strategies,

as well as our best-in-class cross-channel and digital marketing capabilities.

At the same time, to support the diversification of our activities, we have

significantly ramped up our investments in ADLP Assurances, our subsidiary

specialized in direct marketing insurance brokerage. This major development,

harnessing our various areas of know-how and opening up synergies with

our traditional business lines, aims to build up a portfolio of contracts that will

generate future revenues.

In this context, despite our good level of revenues, the commercial investments made in 2015, particularly in ADLP

Assurances, have had a significant impact on our consolidated earnings for the year, with a net margin rate of 2.9%, versus

8.4% in 2014.

Nevertheless, our financial structure is still very sound, with a €26.6 million cash surplus at 31 December 2015 and our net

asset value (group share) up 2.5% to €124.6 million.

In view of these elements, the Management Board has decided to submit a dividend of €1.04 per share for approval by

shareholders at the General Meeting on 17 June 2016.

Our robust position means that we will be able to continue moving forward with our strategy to expand and create value

through our know-how with confidence in new high-growth markets. We are setting ourselves demanding objectives in

order to make our business models more effective, consolidating our potential for sustainable growth and profitability.

I would like to thank all our partners and our shareholders for their confidence, trust and loyalty .

Jean-Marie Vigneron

Chairman of the Management Board

Jean-Marie Vigneron

Chairman of the Management Board

Projet non audité par les CAC

2 | 2015 Annual Report

2015 KEY FIGURES

(€’000,000)

BREAKDOWN OF GROSS SALES VOLUME

268.3 281.5 278.0

2013 2014 2015

GROSS SALES VOLUME

111.4

118.2 118.4

2013 2014 2015

NET SALES

11.8 13

5.3

2013 2014 2015

OPERATING INCOME

7.3

10.0

3.4

2013 2014 2015

NET INCOME (GROUP SHARE)

100.5 96.5

101.9

2013 2014 2015

PORTFOLIO VALUE

118.4 121.5 124.6

2013 2014 2015

NET ASSET VALUE (GROUP SHARE)

207.8

39.1

20.4 10.7

by product type

Open-ended subscription

Fixed-term subscription

Books - Merchandise- Audio - Video

Other 268.0

10.0

by region

France

Spain

GROSS SALES VOLUME AND NET SALES

The gross sales volume represents the value of subscriptions and other products sold, while net sales (determined in line

with the professional status for subscription sales) only include the amount of revenue paid by magazine publishers. For

subscription sales, net sales therefore correspond to a gross margin, deducting the cost of magazines sold from the

amount of sales recorded.



40 YEARS OF MARKETING ENGINEERING

KNOW-HOW, COMBINED WITH THE MOST

INNOVATIVE DIGITAL EXPERTISE

Advice and definition of customer base

acquisition, value creation and loyalty strategies;

Design and management of customer and

prospect management and value development

programs;

Design and implementation of all cross-channel

marketing arrangements;

Implementation of bespoke, integrated customer

marketing solutions;

Management and supervision of high-yield

recruitment and management operations;

Generation of qualified contacts.

PROFILE

With its extensive track record in performance marketing, the ADLPartner Group designs,

markets and implements customer relationship management and loyalty services on its

own behalf or for its major partners across all distribution channels.

Strong value-added marketing expert

Created in 1972, the ADLPartner Group supports leading brands

in various areas: from mass retail to services, e-commerce,

consumer brands, banking and insurance…

Combining over 40 years of marketing engineering know-how

with the most innovative digital expertise, the ADLPartner Group

and its brands have helped build a wide range of original cross-

channel solutions to create performance.

The Group's experts oversee and manage full programs,

capitalizing on the Group's industrial and technological

capabilities, demanding management model, rigorous cost

management, quality culture and highly responsive approach.

Setting the standard for magazine subscription sales

The ADLPartner Group has been marketing and selling magazine subscriptions for 40 years. Its strong BtoBtoC culture

has enabled it to develop its expertise and establish itself as a benchmark in this industry.

Distributed primarily with a white-label approach, open-ended subscriptions represent the main product line, with a portfolio

of 3 million active subscriptions. This advantageous and attractive offer, automatically renewed based on a system for

regular direct debits, provides a solution for magazine publishers looking for new readers and for top brands looking for a

premium turnkey, multichannel service for managing their customer relations.

Developed by ADLPartner for its own business, fixed-term subscriptions, generally for 12 months,

cover a wide range of magazines and newspapers at significantly discounted prices, distributed

BtoC, for instance under the brands offered by Plusdemags or France Abonnements, which also

has a distance selling business for cultural products (books, audio and video) and practical items

(health, wellness and leisure).

ADLPerformance, integrated BtoB customer marketing solutions

Under the ADLPerformance brand, the integrated BtoB customer marketing offers unite together all the high-level cross-

channel marketing solutions and expertise from across the Group and its subsidiaries (Converteo, Activis, Leoo and

ADLPartner Hispania).

ADLPerformance is looking to offer more extensive support for businesses to create value by maximizing the performance

of their customer marketing actions and capitalizing on their customer knowledge.

ADLPerformance offers a new integrated customer marketing model, from designing to implementing global cross-channel

approaches and harnessing the full potential of digital and data.

ADLPerformance already has a strong position on the market, in France and Spain, providing

solutions for all the issues facing major pan-European brands with the implementation of their

customer marketing actions.

http://www.adlperformance.com/fr



ADLP Assurances, direct marketing insurance brokerage

Since 2014, the ADLPartner Group has offered insurance products on a direct

marketing basis for its own customers, as well as its partners’ customers and prospects,

through its brokerage subsidiary ADLP Assurances. This diversification is based around

the Group’s well-established distance selling expertise for recurrent services, while

tailoring it to the insurance market.

Backed by market-leading general and personal risk insurance firms, ADLP Assurances designs and markets bespoke,

targeted products (accidental death, legal protection, etc.), renowned for their performances.

Trust-based relationship with well-known partner brands

ADLPartner is developing a strong partnership-based culture. Today, 40% of the companies from the CAC 40 work with the

Group and its subsidiaries. Historically, the Group has supported leading brands from the banking, mass retail or service

sectors.

ADLPerformance unites together all the high-level cross-channel marketing solutions and expertise from across the Group and

its subsidiaries (Converteo, Activis, Leoo) in France, Spain and Portugal under one dedicated commercial brand

Search marketing and qualified contact generation

Cross-channel and digital strategy consulting

Brand experience program management and design

www.activis.net www.converteo.com

www.leoo.fr www.adlpartner.es

http://www.adlp-assurances.com/

http://www.activis.net/

http://www.converteo.com/

http://www.leoo.fr/



ADLPerformance covers all marketing

techniques with innovative solutions

throughout the value chain.

STRATEGY

The ADLPartner Group is moving forward with a strategy to expand its business and

create value through its know-how in new high-growth markets.

Constantly enhancing marketing mixes for core business activities

In connection with its magazine subscription sales business, the Group is

developing a policy for tradeoffs to focus on open-ended subscriptions based

on partnerships, more resilient than traditional subscriptions.

The marketing innovations introduced with this range are making it possible to

support value creation, particularly by boosting the commercial performance of

mailing campaigns and further strengthening relations with partners.

Developing the marketing services business

With its diversification in the last few years, the Group has significantly

developed its areas of expertise in terms of strategies and the implementation

of relational marketing operations with best-in-class cross-channel and digital

marketing capabilities.

With its 40 years of experience in marketing engineering, combined with its highly innovative approach and data expertise,

the Group and its subsidiaries are able to offer a wide range of turnkey customer marketing solutions for major brands,

tailored to their needs.

The creation of ADLPerformance, the BtoB commercial brand, in

2016 highlights the Group’s commitment to increasing its visibility

with key accounts.

Driven by the Group's 400 staff, ADLPerformance is positioning

itself as a major player in its industry, supporting businesses with

their cross-channel marketing performance.

Diversification into direct marketing insurance brokerage

The ADLPartner Group is developing its range of services, while

looking into and testing out opportunities to capitalize on its assets

and expertise with new customers and products that share core

economic features with the subscriptions business, similar to press

subscriptions.

After carrying out some initial tests with encouraging results in

2014, ADLP Assurances, specialized in direct marketing insurance brokerage, significantly ramped up its commercial

investments in 2015, aiming to build up a portfolio of contracts that will generate future revenues.

External growth

With its strong financial position, the ADLPartner Group is moving forward with a strategy for self-financed, targeted

acquisitions of small or mid-size companies that have promising prospects and strong market positions or proven

technological expertise.

http://www.adlperformance.com/fr

http://www.adlp-assurances.com/



STOCK MARKET AND SHAREHOLDING

Change in the share price

Shareholder dashboard

Listing market Euronext Paris (France)

ISIN FR0000062978 – ALP

PEA-PME eligible

Number of shares 4,294,725

Parent company net income €8,899,000

Proposed payout after deducting treasury stock

€4,080,000

Payout rate 45.8 %

Proposed dividend per share €1.04 €

Yield based on average share price for 2015

6,6 %

Share price : 2015 average share price + 2015 high + 2015 low End of period

€15.72 €18.91 €11.01 €12.35

Market capitalization (at 31 Dec 2015) €53,039,854

Legal structure at 31 December 2015 (% of capital)

8

10

12

14

16

18

20

Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16

closing price (€)

0

10000

20000

30000

40000 volume

72.2%

8.7%

19.1%

Vigneron family group

Treasury stock

Public

83.5%

5.0%

11.5%

Breakdown of capital

Theoretical breakdown of voting rights


2015 CONSOLIDATED FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEET 8

CONSOLIDATED INCOME STATEMENT 10

STATEMENT OF CONSOLIDATED NET CASH FLOW 11

CHANGE IN CONSOLIDATED SHAREHOLDERS' EQUITY 12

KEY PERFORMANCE INDICATORS 13

CONSOLIDATED FINANCIAL STATEMENTS


CONSOLIDATED BALANCE SHEET

ASSETS

(€ thousands) 12/31/2015 12/31/2014

NON-CURRENT ASSETS

Goodwill 24 24

Intangible assets 1,276 1,320

Tangible assets 3,523 3,707

Investments in associates 3,496 2,344

Assets held for sale 50 216

Other financial assets 2,680 563

Deferred tax assets 1,038 1,698

Total Non-current assets 12,087 9,872

CURRENT ASSETS

Inventory 2,939 1,812

Trade and other receivables 36,358 32,444

Other current assets 2,519 2,924

Cash and cash equivalents 26,594 36,041

Total Current assets 68,410 73,221

Assets held for disposal

TOTAL ASSETS 80,497 83,093



EQUITY AND LIABILITIES

(€ thousands) 12/31/2015 12/31/2014

Share capital 6,681 6,681

Consolidated reserves 12,535 8,282

Consolidated net income 3,428 9,957

Shareholders' equity 22,644 24,921

Of which:

Group share 22,644 24,921

Minority interests 0 0

NON-CURRENT LIABILITIES

Long-term provisions 2,203 2,191

Financial debt 100 100

Deferred taxes liabilities 538 500

Total Non-current liabilities 2,840 2,791

CURRENT LIABILITIES

Short-term provisions 339 445

Tax, personnel and fringe benefits 10,749 11,265

Trade and other payables 42,518 42,678

Financial debt 8 4

Other liabilities 1,399 989

Total Current liabilities 55,012 55,382

Liabilities held for disposal

TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES 80,497 83,093



CONSOLIDATED INCOME STATEMENT

(€ thousands) 2015 2014

Net sales (excluding VAT) 118,370 118,186

Purchases (34,448) (28,790)

Personnel costs (22,848) (22,871)

External charges (50,572) (47,516)

Taxes and duties (1,820) (2,129)

Depreciation and amortization (787) (1,075)

Other operating income (expenses) (2,574) (2,813)

Current operating income 5,322 12,993

Other income (expenses)

Operating income 5,322 12,993

Income from cash and cash equivalents 310 348

Gross cost of financial debt (47) (92)

Net financial income 263 256

Other financial income (expense) (163) 520

Income tax charge (1,754) (2,616)

Share of Associates' net income (163) (211)

NET INCOME BEFORE INCOME FROM DISCONTINUED OPERATIONS OR HELD FOR DISPOSAL

3,504 10,942

Net income (loss) on discontinued operations or held for disposal (76) (985)

NET INCOME 3,428 9,957


Minority interests

Basic net income (Group share) per share (€) 0,87 2,51

Diluted net income (Group share) per share (€) 0,84 2,43

Statement of comprehensive income 2015 2014

Net income 3,428 9,957

Income and expenses directly taken to equity:

Translation adjustment relating to the conversion of foreign currency-denominated operations

Net actuarial (losses)/gains on defined benefit pension schemes, net of tax 85 (166)

Comprehensive income 3,513 9,791


Minority interests



STATEMENT OF CONSOLIDATED NET CASH FLOW

(€ thousands) 2015 2014

CONSOLIDATED NET INCOME (INCLUDING MINORITY INTERESTS) 3,428 9,957

+/- Net depreciation, amortization and provisions (excluding items linked to current assets) 942 896

-/+ Unrealized capital gains (losses) relating to fair value movements (354)

+/- Calculated (expenses) income linked to stock options and related items (3) 72

-/+ Other calculated (expenses) income

-/+ Capital gains losses on disposal of assets 4 355

-/+ Dilution gains (losses)

+/- Share of Associates' net income 163 211

- Dividends (unconsolidated securities)

Cash flow after cost of net financial debt and tax 4,535 11,137

- Net financial income (263) (256)

+/- Income tax charge (including deferred taxes) 1,754 2,616

Cash flow before net financial income and income tax (A) 6,026 13,497

- Income tax paid (B) (3,066) (1,837)

+/- Change in WCR linked to operations (including debt linked to employee benefits) (C) (3,723) 1,657

= NET CASH FLOW FROM OPERATIONS (D) = (A + B + C) (763) 13,317

- Funds paid for acquisition of tangible and intangible assets (842) (530)

+ Funds received from the sale of tangible and intangible assets 18

- Funds paid for acquisition of long-term investments (unconsolidated securities) (212)

+ Funds received from the sale of long-term investments (unconsolidated securities) 1

+/- Impact of changes in group structure (1,315) (770)

+ Dividends received (equity accounted companies, unconsolidated securities)

+/- Movements in loans and advances granted (1,100) (157)

+ Investments grants received

+/- Other cash flows from (used in) investing operations (17) (2)

= NET CASH FLOW FROM (USED IN) INVESTING ACTIVITIES (E) (3,255) (1,671)

+ Proceeds from share capital increases

. Paid by parent company shareholders

. Paid by minority interests in consolidated companies

+ Sums received upon exercise of stock options 280 68

-/+ Purchase and sale of treasury shares (1,612) (31)

- Dividends paid over the fiscal year

. Dividends paid to parent company shareholders (4,411) (2,899)

. Paid to minority interests in consolidated companies

+ Proceeds from new borrowings

- Repayment of loans (including lease finance agreements)

-/+ Net financial interest (including lease finance agreements) 310 368

+/- Other cash flows used in financing operations (299)

= NET CASH FLOW FROM (USED IN) FINANCING ACTIVITIES (F) (5,432) (2,792)

+/- Impact of fluctuations in currency exchange rates (G) (3)

= CHANGE IN NET CASH (D + E + F + G) (9,450) 8,851

Cash and cash equivalents at the beginning of the year 36,037 27,185

Cash and cash equivalents at the end of the year 26,586 36,037



CHANGE IN CONSOLIDATED SHAREHOLDERS’ EQUITY

Group share

(€ thousands) Share capital

Parent company

surplus (1)

Consolidated reserves (2)

Net income for the year

TOTAL Minority interests

Total consolidated

entity

SHAREHOLDERS' EQUITY AS AT 12/31/13

6,681 14,807 (10,852) 7,304 17,940 298 18,238

Net income for the year 9,957 9,957 9,957 Translation adjustment relating to the conversion of foreign currency-denominated 0 0

operations Net actuarial (losses)/gains on defined benefit (166) (166) (166)

pension schemes, net of tax Comprehensive income for the year (166) 9,957 9,791 0 9,791

Net income allocation 5,822 1,482 (7,304) 0 0

ADLPartner dividends (2,899) (2,899) (2,899)

Impact of treasury shares 17 17 17

Impact of stock options 72 72 72 Refund Capital Reserve Abo Service International (0) (0) (298) (298)


6,681 17,730 (9,448) 9,957 24,921 0 24,921

Net income for the year 3,428 3,428 3,428 Translation adjustment relating to the conversion of foreign currency-denominated 0 0

operations Net actuarial (losses)/gains on defined benefit 85 85 85

pension schemes, net of tax Comprehensive income for the year 85 3,428 3,513 0 3,513

Net income allocation 9,158 799 (9,957) 0 0

ADLPartner dividends (4,411) (4,411) (4,411)

Impact of treasury shares (1,376) (1,376) (1,376) Impact of stock options and attribution of bonus shares (3) (3) (3)


6,681 22,478 (9,943) 3,428 22,644 0 22,644



KEY PERFORMANCE INDICATORS

GROSS SALES VOLUME

Gross sales volume represents the value of subscriptions and other products sold.

Net sales represent:

For subscription sales: the amounts paid by magazine publishers, with sales generated by the company in its

capacity as a press agent. Net sales therefore correspond to a gross margin, deducting the cost of magazines sold

from the amount of sales recorded,

For other products sold: sales revenue.

Gross sales volume is reported before any discounts or cancellations. It therefore represents the most stable and

standard indicator for the group's performances.

Gross sales volume from continuing operations decreased by 1.2% to €277,973 thousand in 2015 compared with

€281,472 thousand in 2014.

Gross sales volume can be broken down as follows:

By region

(€’000) 2015 2014

France 267,981 272,680

Spain 9,992 8,792

TOTAL 277,973 281,472

By product range

(€’000) 2015 2014

Open-ended subscriptions 207,849 208,514

Fixed-term subscriptions 39,060 41,396

Books-merchandise-audio-video 20,393 24,360

Other 10,671 7,202

TOTAL 277,973 281,472

NET ASSET VALUE

The portfolio of open-ended subscriptions managed by the Company came to 3,065,957 units at 31 December 2014. It

represented 3,174,811 subscriptions at 31 December 2015. It should be noted that all group companies hold the financial

rights relating to each open-ended subscription.

The value of the portfolio of open-ended subscriptions, net of taxes (group share), rose from €96.5 million at 31

December 2014 to €101.9 million at 31 December 2015.

This change in terms of the real asset value is not reflected in the consolidated financial statements .

The value of the portfolio of open-ended subscriptions can be calculated by determining the present value of the future

net revenues that these subscriptions will generate throughout their useful life. These revenues can be determined

accurately using the statistical information accumulated by the Company over several years concerning the behavior of

such subscriptions in France and for its subsidiaries.

The life curve of subscriptions recruited by a promotional campaign makes it possible to determine, at any time, the

residual life expectancy of subscriptions with great accuracy. The net contribution still to be received can be determined



by applying the average revenues observed and the margin on direct costs (with discounts deducted) to the number of

remaining subscriptions.

For mixed subscriptions with a firm 12-month commitment, the value of the portfolio determined in this way is restated for

the margin on direct costs, already recognized in the group’s accounts. Indeed, net sales and the outstanding costs for

the firm commitment period are recorded in the group’s accounts as soon as subscriptions are activated with publishers.

The present value of this contribution, calculated by applying a rate based on the money market rate, gives the value of

this number of subscriptions. These portfolio values are then corrected for any underlying tax.

The value of the portfolio of open-ended subscriptions, net of taxes (group share), can be broken down as follows:

(€’000)

Value of ADL portfolio

(net of tax)

(group share)

at 12/31/2015 at 12/31/2014

ADLPartner France 99,958 94,030

ADLPartner Hispania 1,949 2,519

Total 101,907 96,549

Factoring in the portfolio value (group share) and consolidated shareholders’ equity (group share), net asset value (group

share), rose 2.5% from €121.5 million at 31 December 2014 to €124.6 million at 31 December 2015.

Net asset value can be broken down as follows:

(€’000) 12/31/2015 12/31/2014

Total Group

share

Minority

Interests Total

Group

share

Minority

Interests

Consolidated shareholders' equity 22,644 22,644 0 24,921 24,921 0

Value of ADL's portfolio

(net of taxes) 101,907 101,907 0 96,549 96,549 0

NET ASSET VALUE 124,551 124,551 0 121,470 121,470 0

Net asset value (group share) represents €31.4 per share (excluding treasury stock).

3, rue Henri Rol-Tanguy

93100 Montreuil - France

Tel: +33 (0)1 41 58 72 03

Fax: +33 (0)1 41 58 70 53

www.adlpartner.com

2015 - ADLPerformance · through our know-how with confidence in new high-growth markets. ......

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Transcript of 2015 - ADLPerformance · through our know-how with confidence in new high-growth markets. ......