Technicolor: Third Quarter 2015 Revenues
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Technicolor: Third Quarter 2015 Revenues

PARIS, Oct. 20, 2015 (GLOBE NEWSWIRE) -- Technicolor (Euronext Paris: TCH; OTCQX: TCLRY) announces today its revenues for the third quarter of 2015.

Frederic Rose, Chief Executive Officer of Technicolor, stated:

"We are well on our way to achieve our 2015 objectives based on our solid third quarter revenue performance. In addition, while focusing on execution across our businesses, we announced major strategic milestones, with The Mill and Cisco Connected Devices, which will strongly accelerate the delivery of our Drive 2020 objectives."

Key points

2015 objectives

Segment review - Q3 2015 revenue highlights

Group revenues by segment

   Third Quarter  Change YoY
In € million 2014 2015 At current rate At constant rate
Technology 116 121 +4.6% +6.9%
Entertainment Services 330 423 +28.1% +18.2%
Connected Home 369 332 (10.0)% (11.4)%
Other 0 0 ns ns
Group revenues (excluding exited activities) 815 876 +7.5% +3.2%
Exited activities 28 1 (96.6)% (96.2)%
Group revenues 843 877 +4.0% (0.1)%

Technology revenues amounted to €121 million in the third quarter of 2015, up 4.6% at current currency compared to the third quarter of 2014. Licensing revenues stood at €117 million in the quarter, up €5 million year-on-year at current currency. This increase reflected higher revenues from the MPEG LA pool, due to favorable €/US$ exchange rate fluctuations, as well as a good performance of the Group's direct licensing programs that benefited from the contribution of new contracts signed in prior quarters.

During the third quarter, Technicolor and Sony announced a joint patent licensing program for Digital TV ("DTV") and Computer Display Monitor ("CDM"). Technicolor will be the exclusive licensing agent of the combined portfolio that covers DTV and CDM. Through this agreement, the Group not only secures long term revenues in its DTV program and will generate incremental revenues in the field of CDM, but also demonstrates its agility to develop ad-hoc partnerships in IP.

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Entertainment Services revenues (excluding exited activities) reached €423 million in the third quarter of 2015, up 28.1% at current currency compared to the third quarter of 2014. This performance resulted from a sustained level of activity in Visual Effects and Animation activities in Production Services, as well as increased volumes related to a strong slate of Studio new releases in DVD Services.

      

     Postproduction revenues were broadly stable in the quarter, and slightly lower in North America due to fewer theatrical and TV productions.

     In the third quarter, VFX teams completed work on The Martian (Fox), Goosebumps (Sony), Fantastic Four (Fox) and Pan (Warner), while pursuing work on a number of Theatrical projects, including Jungle Book (Disney), Batman v Superman: Dawn of Justice (Warner), Monster Trucks (Paramount), X-Men: Apocalypse (Fox), 007 Spectre (Sony), The Finest Hours (Disney) and Tarzan (Warner). VFX teams also started working on new projects such as Independence Day: Resurgence (Fox) and Ghostbusters 3 (Sony). In the third quarter, Postproduction teams completed work on Theatrical projects including Ant-Man (Disney/Marvel), Fantastic Four (Fox), The Intern (Warner), Burnt (Weinstein) and Bridge of Spies (Disney). Postproduction teams also continued work on premium TV series, including Vampire Diaries (CW), Criminal Minds (CBS), Scandal (ABC), Heroes Reborn (NBC) and iZombie (CW) for leading TV broadcasters, as well as on original TV content such as Mozart In The Jungle (Amazon), Narcos (Netflix) and Sense8 (Netflix) for Over-the-Top ("OTT") services providers.

     Selected key Theatrical titles produced in the third quarter of 2015 included Avengers 2: Age of Ultron (Disney/Marvel), Inside Out (Disney), Jurassic World (Universal), Furious 7 (Universal), Mad Max: Fury Road (Warner), as well as Terminator Genisys (Paramount). Key Games titles produced in the quarter included FIFA 16 (Electronic Arts) and Call of Duty: Black Ops III (Activision).

Volume Data for DVD Services

   Third Quarter  Nine Months
In million units 2014 2015 Change 2014 2015 Change
Total Combined Volumes 329.7 337.1 +2.2% 894.7 833.1 (6.9)%
By Format SD-DVD 264.8 264.8 +0.0% 722.8 660.9 (8.6)%
  Blu-ray(TM) 64.9 72.3 +11.4% 171.9 172.3 +0.2%
By Segment Studio/Video 299.1 309.7 +3.6% 825.6 776.1 (6.0)%
  Games 20.1 20.3 +1.0% 41.2 35.7 (13.2)%
  Software & Kiosk 10.6 7.0 (33.4)% 28.0 21.3 (23.9)%

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Connected Home revenues amounted to €332 million in the third quarter of 2015, down 10% at current currency compared to the third quarter of 2014. This performance reflected lower total product volumes of 7.7 million units (-14.2%) in the quarter, with a weak level of activity in North America, partially offset by an improvement in overall product mix across most regions, with the exception of Brazil.

As expected, the soft revenue trend experienced by the Connected Home segment in the second quarter of 2015 persisted during the third quarter, almost entirely due to North America, where customer orders continued to be affected by pending industry consolidation, and in Brazil, due to softening macroeconomic conditions. Connected Home recorded however double-digit revenue growth in Europe, Middle-East and Africa and in Asia-Pacific, driven notably by the ramp-up of new higher-end devices during the period.

Technicolor expects overall sales growth to resume strongly in the fourth quarter of 2015, resulting from a number of new awards and customer wins, including high-end products. As a result, Connected Home revenues are expected to grow year-on-year materially faster than the market on a full year basis (at current currency).

Q3 2015 Regional Highlights

Volume Data for Connected Home

   Third Quarter  Nine Months
In million units 2014 2015 Change 2014 2015 Change
Total Combined Volumes1 9.0 7.7 (14.2)% 25.5 21.4 (16.0)%
By Region North America 2.9 1.6 (45.5)% 6.8 4.7 (31.5)%
  Latin America 2.8 2.4 (13.8)% 8.4 8.4 +0.6%
  Europe, Middle-East and Africa 1.8 1.9 +6.8% 5.8 5.2 (10.6)%
  Asia-Pacific 1.5 1.8 +18.8% 4.5 3.1 (30.2)%

  1 Including tablets and other connected devices.

Segment review - Year-to-date performance

   Nine months  Change YoY
In € million 2014 2015 At current rate At constant rate
Technology 331 389 +17.2% +17.5%
Entertainment Services 909 1,075 +18.2% +5.9%
Connected Home 1,024 984 (3.9)% (9.8)%
Other 0 0 ns ns
Group revenues (excluding exited activities) 2,265 2,447 +8.0% +0.5%
Exited activities 84 51 (38.7)% (49.5)%
Group revenues 2,349 2,499 +6.4% (1.3)%

Technology revenues reached €389 million in the first nine months of 2015, up 17.2% at current currency compared to the first nine months of 2014, as a result of increased revenues from the MPEG LA pool and ongoing solid performance of the Group's direct licensing programs that benefited from the contribution of new contracts signed in prior quarters, particularly in Digital TV.

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Entertainment Services revenues (excluding exited activities) amounted to €1,075 million in the first nine months of 2015, up 18.2% at current currency compared to the first nine months of 2014. At constant currency, revenues increased 5.9% year-over-year, as strong double-digit revenue growth in Production Services, driven by VFX and Animation activities, more than offset lower DVD Services revenues, despite strongly improved volume trend in the third quarter of 2015.

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Connected Home revenues stood at €984 million in the first nine months of 2015, down 3.9% at current currency compared to the first nine months of 2014. Connected Home has outperformed the market in the first nine months of 2015, recording a solid level of activity despite mixed market conditions and persistent weakness in North America, primarily driven by the consolidation movements experienced in the industry. The Group is confident in its capacity to outperform the market on a full year basis.

Financial Calendar

FY 2015 Results 19 February 2016
Q1 2016 Revenues 29 April 2016

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Warning: Forward Looking Statements

This press release contains certain statements that constitute "forward-looking statements", including but not limited to statements that are predictions of or indicate future events, trends, plans or objectives, based on certain assumptions or which do not directly relate to historical or current facts. Such forward-looking statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the future results expressed, forecasted or implied by such forward-looking statements. For a more complete list and description of such risks and uncertainties, refer to Technicolor's filings with the French Autorité des marchés financiers.

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About Technicolor

Technicolor, a worldwide technology leader in the media and entertainment sector, is at the forefront of digital innovation. Our world class research and innovation laboratories enable us to lead the market in delivering advanced video services to content creators and distributors. We also benefit from an extensive intellectual property portfolio focused on imaging and sound technologies, based on a thriving licensing business. Our commitment: supporting the delivery of exciting new experiences for consumers in theaters, homes and on-the-go.

www.technicolor.com - Follow us: @Technicolor - linkedin.com/company/technicolor

Technicolor shares are on the NYSE Euronext Paris exchange (TCH) and traded in the USA on the OTCQX marketplace (OTCQX: TCLRY).

Media Contacts

Sandra Carvalho: +1 323 208 2624

sandra.carvalho@technicolor.com

Investor Relations

Emilie Megel: +33 1 41 86 61 48

emilie.megel@technicolor.com

Laurent Sfaxi: +33 1 41 86 58 83

laurent.sfaxi@technicolor.com

1 Exited activities include legacy, Digital Cinema and Media Services activities in the Entertainment Services segment, and IZ-ON in the Other segment.

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