DGAP-News: Highlight Group with positive sales and earnings growth in fiscal year 2021

Highlight Group with positive sales and earnings growth in fiscal year 2021

- Significant increase in consolidated sales by 22.6 % to CHF 508.2 million

- EBIT increases by 11.7 % to CHF 28.6 million

- Consolidated net profit for the period attributable to shareholders increases by 21.5 % to CHF 14.8 million

- Earnings per share gratifyingly increased by 23.8 % to CHF 0.26

- Equity ratio of 30.5 % as of Dec. 31, 2021

The Highlight Group's business performance was positive overall - also in view of the ongoing Covid-19 pandemic in 2021.

Group development in fiscal 2021

• At CHF 508.2 million, consolidated sales were up 22.6 % on the prior-year figure of CHF 414.6 million. All segments (Film, Sports- and Event-Marketing and Sports) generated higher external sales than in the previous year. In the Film segment, there were higher sales in theatrical distribution, home entertainment and TV service productions. In addition, sports events were held again.
   
• Group operating expenses increased year-on-year to CHF 636.9 million due to productivity and were 27.8 % higher than the comparable figure for fiscal 2020 (CHF 498.3 million).
   
• As a result of the increase in sales revenues, EBIT rose by CHF 3.0 million or 11.7 % to CHF 28.6 million (comparative period: CHF 25.6 million).
   
• The share of earnings attributable to shareholders increased to CHF 14.8 million compared to CHF 12.2 million in the previous year.

Development of the operating segments in 2021

• In the Film segment, the impact of the Covid 19 pandemic was still being felt in theatrical distribution in 2021. There were a total of nine in-house and co-productions in theatrical production, including the in-house production "Liebesdings", "Guglhupfgeschwader" from the successful Eberhofer series, "Freibad" and the follow-up production to the hit movie "Der Vorname". Ten movies were released in German movie theaters in theatrical distribution in the fiscal year, including "Kaiserschmarrndrama", "Contra", "After Love" and the sequel to the successful series "Ostwind - Der große Orkan". In TV exploitation/license trading, various license sales of in-house and third-party productions were realized in 2021. Among others, Constantin Film and RTL Deutschland plan to further expand their successful cooperation. In free TV, sales were generated in particular by the start of initial licenses such as "After Passion" and "Papillon" (ProSieben), "Der Fall Collini" (ARD) and "Der Vorname" (ProSieben). In pay TV, the following premieres were also brought forward due to the pandemic: "Monster Hunter", "Wrong Turn: Foundation" and "Horizon Line" (all Sky).
  
  Sales in the Film segment increased to CHF 331.5 million in the year under review (previous year: CHF 261.3 million). Other segment income, which are largely capitalized film productions, increased by 35.7 % to CHF 141.5 million (previous year: CHF 104.3 million). Segment expenses rose by a total of 29.7 % to CHF 457.1 million (previous year: CHF 352.4 million), in particular as a result of scheduled depreciation and amortization; therefore, the segment result increased by 19.6 % to CHF 15.9 million (previous: CHF 13.3 million).
   
• In the Sport- and Event-Marketing segment, TEAM group focused on the development of commercial concepts and rights packages for the 2021/22 to 2023/24 cycle of the UEFA Champions League, the UEFA Europa League, and the UEFA European Conference League in the reporting year.
  
  At CHF 68.4 million, external sales in the Sports- and Event-Marketing segment were up by 11.2 % on the previous year's level (CHF 61.5 million). Segment expenses increased from CHF 34.8 million to CHF 41.8 million, while other income rose from CHF 0.6 million to CHF 0.7 million. The segment earnings of CHF 27.3 million were slightly higher than in the previous year (CHF 27.2 million).
   
• In the reporting year, the Sports segment continued to focus on optimizing its portfolio of rights, improving and creating new digital content and marketing environments in addition to cross-platform content exploitation. The segment generated sales of CHF 108.3 million in fiscal 2021, up 18.1 % on the figure for the previous year (CHF 91.8 million). Other income increased from CHF 4.9 million to CHF 16.5 million. Expenses increased to CHF 132.8 million as a result of the sports events held and were thus 25.1 % higher than the previous year (CHF 106.2 million). The segment result amounted to CHF -7.7 million (previous year CHF -9.0 million).

Targets for fiscal 2022

The global spread of the COVID 19 virus and the impact of the Ukraine crisis continued to weigh on the Highlight Group's operating activities in the first quarter of 2022.

As in the previous year, the Board of Directors is monitoring the situation in the current reporting period and regularly reviews the measures taken. The Highlight Group plans, among other things, to return to stable and economically successful business activities with major growth potential, including a strong theatre program in the Film segment and the new Bundesliga rights for the 2021/22 season in the Sports segment. Due to the risks mentioned above, the Board of Directors is currently unable to issue a forecast for fiscal 2022.

The Annual General Meeting for fiscal 2021 is scheduled to take place in June 2022.

The audit work could only be completed last week. We expect to be able to publish the
audited annual report towards the end of the week. In the meantime, an unaudited version
of the 2021 annual report is available to shareholders and interested parties at
www.highlight-communications.ch.