Earnings Transcript for VIV.PA - Q4 Fiscal Year 2021

Operator: Good evening everyone and welcome to the Vivendi full year 2021 earnings presentation. This conference call will be hosted by Mr. Arnaud de Puyfontaine , Chairman of the Management Board and CEO and Mr. Hervé Philippe, a member of the Management Board and CFO. As a reminder, this call is being recorded. Duration of the call, you will be on listen-only. However, later on the call during the Q&A session, analysts will have the opportunity to ask questions without any follow-up questions. [Operator Instructions] I would now like to turn the call over to Mr. Arnaud de Puyfontaine . Please go ahead, sir. Your line is open.

Arnaud de Puyfontaine : Thank you very much. And good evening, everyone. Welcome. Thank you for joining us today. I hope that you are all keeping well. Of course, I would like to begin by expressing our thoughts for Ukraine. We are like everyone, very concerned by this war. We are in constant contact and solidarity with the Gameloft and Havas teams based in Ukraine. From a business angle, we have a very low exposure in Ukraine and Russia, let's hope for rapid hands to this conflict. Before commenting on 2021 key highlights, I would like to remind you to take a moment to read carefully the usual legal disclaimers. Thank you. 2021 was a historic significant year for Vivendi. As a group, we enjoyed strong growth in revenues and EBITDA. Revenues increased by 10.4% compared to 2020 and by 8.6% organically. This is our best organic growth since we took over the leadership of the group in 2014. In 2021, EBITDA has more than doubled compared to 2020. Hervé Philippe will elaborate on this outstanding performance. What is remarkable is that all our activities have been growing while continuing the transformation. Let me thank the Vivendi teams around the world for your commitment and talent for reinvention in a complex and unpredictable environment. The year 2021 also marked an acceleration in the implementation of our strategy, thanks to major restructuring operations that redesigned the controls of our group. The first one was UMG’s listing on Euronext and the distribution of nearly 60% of its capital. On its first day of listing on September 21st, the company was valued at nearly €45 billion, confirming its attractiveness, as well as our ability to transform our businesses. We always believed in the incredible potential of UMG and it's teams, despite the gloomy predictions of others. We continued to invest for growth and contributed to the renewal of the music industry. As you know, Vivendi retains a 10% stake in UMG and we remained privileged shareholders. The second was Vivendi's entry into new business, perfectly complementary to our other activities. The integration of Prisma Media, the French later in press magazines was completed in record time. Thanks to its strong digital audiences, Prisma has enabled the group to climb into the top three digital groups in France in terms of unique visitors, alongside Google and Facebook. Lastly, Vivendi acquired Amber Capital's shares in Lagardère in December, bringing its stakes to 45.1% of the capital. On February 21st 2022, the group filed its tender offer with the French securities regulator, IMF. This merger will make it possible to push through strong industrial ambitions with significant investments in quality and diversified content, and contributes to the promotion of culture. This offer for the capital of Lagardère, is thus in line with Vivendi's strategy. To build a major group with European culture and global ambitions in media, content, and communications. These strategic ambition is more and more relevant in the context of the rapid transformations, and global consolidation in our sectors. No European player is currently among the top 10 global media groups, nor a non - GAAP to top 10 internet player in the world. We believe that Vivendi can scale these heights by proposing an alternative offer of cultural content. We have a large catalog of films, series, and books, which are hugely successful internationally. Let's take a couple of examples, can I please say [Indiscernible] the Bureau distributed in 100s countries. Or offers like [Indiscernible] translated into 34 languages. Promoting Europe and culture in all its diversity. And is our ambition. This is an immense responsibility. We want to play our full part. For this, we can rely on our strong assets. Enabling us to look to the future with confidence in a context of Never Ending appetite for content. Let me name a few. First, our ability to attract and develop the best talent. In 2021, Studio canal Film, [Indiscernible] where huge box office successes. Havas agencies received 1300 award and distinctions around the world. ADT's ranked ten of its offers among the top 30 most purchased French language offers in modern fiction. Second, our significant capacity to invest in culture and creation. In 2021, we invested over $1.6 billion in content. We were also investing to modernize our sectors, thus helping transform the cultural and creative industries. Strong and appealing brands connected to their audiences, we have a direct link with many communities, viewers, readers, gamers. For instance, Editis has 1 million cumulative followers on Instagram. Gala, a Prisma Media brand is the most followed European Media on TikTok with 2.5 million subscribers. Then the complementary of our businesses even these prominent promise is to enhance the common potential of its businesses and to make them grow together through value-creating joint project. In 2021 for example, Havas ADT's and Prisma Media created the hear solution to accompany the recovery of the tourism industry. Then the constant support of our principal shareholder, the Bolloré Group. Who provide the guarantee of long-term vision and stability? And more widely, while continuing to perform economically, Vivendi is committed to being a responsible and sustainable company. Last year, I shared with you our new CSR program Creation for the Future built around the three pillars

Hervé Philippe: Thank you very much, Arnaud. Good evening to everyone. It's my pleasure to present to you our 2021 financial results. First on Slide 13, let me review the main changes in the scope of consolidation. Universal Music has been deconsolidated since last September, in accordance with IFRS rules. Our 2020 and 2021 accounts were restated to exclude its contribution to revenues on EBITDA. As of September 23rd, the 10% stake we retained is accounted for under the equity method. The other change is our attitude to the equity accounting of our stake in Lagardère since July 1st and the acquisition of Prisma Media completed at the end of May. On the next slide, you can see the evolution of the main currencies of the group. Over the years, the Euro depreciated against the U.S. dollar and the British pound, conversely, the Euro strengthened against a Polish zloty, mainly impacting currencies figures. On Slide 15, you will see that in total, FX had a negative impact of 100 basis points on our revenues, mainly at the level of Canal + Groups and Havas. And the consolidation scope impacts on revenues correspond to the acquisition of Prisma media, on some other bolt-on acquisitions made by Avaya on canopies. The perimeter impacts on EBITDA correspond to the exhibited contribution of Universal Music. Unless you are there as operational equity affiliates. On Slide 16, we have a summary of the key financial metrics. As announced by Arnaud Vivendi's, financial results are very strong with first, revenue increasing above 9.5 billion year-ago, with organic growth of 8.6% compared to 2019, growth was 9.4%. Second, the doubling of EBITDA driven by the strong rebound of all our businesses after the pandemic, compared to 2019 EBITDA grew by 72%. And finally, adjusted net income also doubled. On the balance sheet, net cash amounted to €348 million at the end of 2021. Going to Slide 17 and to the IFRS P&L. Please note that we present two different P&L to improve the understanding of our financial. The IFRS net result was greatly impacted in 2021 buys a UMG transaction. I will comment on revenues later when I discuss the performance by business units. On this slide, let me highlight 3 line items in the P&L. First in 2021 with depreciated the goodwill related to the acquisition of Gameloft for €200 million to reflect the decline in it's operating performance over the recent period. Second, other financial income and charges were impacted by the write-down on -- of the Telecom Italia shares. We reduced the value of our stake by €0.20 per-share, leading to a charge of €728 million, notably to take into account uncertainties that could affect Telecom Italia 's outlook. And lastly, a very important line item this year linked to the deconsolidation of Universal Music. Earnings from discontinued operations amounted to €25.4 billion. This amount corresponds to the UMG’s contribution until the date of its listing and the capital gain on its the consolidation. Finally, net earnings amounted to €24.7 billion. It's worth noting that in 2021 and 2020, the P&L did not benefit from the recognition of the €7 billion capital gains on the sale of the minority stakes in UMG, which were directly recognized in equity in accordance with IFRS tools. On the next slide, we present the adjusted net come -- net income statement. This result, which excludes the impact of UMG’s deconsolidation as well as some other non-cash IFRS accounting adjustments is more of representative of this financial performance. At the bottom of the table, you can see that adjusted net income more than doubled compared to 2020. This increase mainly included the growth in EBITDA and income from investments partially offset by the decline of our share in Telecom Italia earning accounted for under the equity method. Moving to balance sheet on Slide 19. Note that the balance sheet as of December 2020 has not been restated and included EMC figures. The most notable changes compared to the 2020-year end balance sheet relate to the exit of UMG from the consolidation scope. In short, even after the deconsolidation of UMC at 2021 year-end, our balance sheet was still in very good shape. Consider that this equity increased to €19.2 billion comes from the sale of 20% of UMG on its deconsolidation. As for assets, the decrease in goodwill was mainly due to the exit of UMG’s assets for around €5 billion. Net cash amounted to €348 million and the value of our financial investments amounted to €10 billion and included our 10% stake in UMG at the end of 2021. Aside from our consolidated assets, UMG is managing a portfolio of investments that we can divide into two categories

Operator: Thank you. [Operator Instructions] The first question is coming from the line of Lisa Yang from Goldman Sachs. Your line is now un -muted. You may now go ahead.

Lisa Yang: Good evening. Thanks for taking my questions. So firstly, it's great to see the profitability of the other businesses improving meaningful. I think in H2 you almost breakeven I think [Indiscernible] loss. Do you think that's sustainable into 2022, if we take all these all the businesses we should get to even break even or positive EBITDA for 2022? That's the first question. The second question is on Canal +. Again, great turnaround there. The French business was up 3% in 2021. Just wondering how much of that is driven by the sub-license thing deal with Altice? And also maybe the strength of the advertising rebound just to -- so we can understand the underlying growth. And what do you see as a new normal for that business in terms of growth going forward? Is that like 1% or 2% that's sustainable? And the third question is on the buyback. I think last time you bought shares was at the end of November. So obviously, given where the share price is today, what are you thoughts in terms of resuming the share buyback and the potential timing of that? I think you still have 450 million shares to buy before the AGM. These are all my questions. Thank you.

Hervé Philippe: Thank you Lisa, for your question. We have not provided guidance season of EBITDA for 2022. As you have seen in [Indiscernible]. It's our general policy not to provide EBITDA for the businesses. But we can say is that it will obviously depend on what are some of in general economy and the situation in the world, but we are -- I would say quite confident on the evolution our main businesses, mainly because I think that joins the pandemic. We have taken the appropriate measures in terms of savings and cost control. And an organization on this lead clearly to improve month that we have seen in 21 in the profitability of different businesses. Thoughtful for Canal + [Indiscernible] two different questions regarding getting turned at risk. We can say is that pet -- pay TV phones, so revenues where we're flat ex within them subsidize on SEC revenues, staffing, net in H2, and we would have some -- something which would be [Indiscernible] flat. We'd have a good impact of that also in 2022 as this sub-license continues in 2022. Generally speaking, the trend is good for Canal +. I don't know what will be the growth but it depends directly on the trend in the subscription base and you have seen that we have had growth in the subscription base both as international part of Canal + and also in France. For the buyback, you know that We will run our current program would be continued until May 6, 2022 for the remaining balance of the shares which have not yet been bought. On the -- obviously, we report each day to the IMF, the shares that we buy back when we buy back shares. So there is a remaining balance, I believe something like 45.1 million shares to be bought, this is 4.1% of the share capital. And as you imagine, we have a price limit to buy back shares. And ones are some bad news on the market. And when we see decreases on stock price, we benefit on that to buy back shares. Thank you very much.

Operator: Thank you so much for your question. The next question is coming from the line of Adrien de Saint Hilaire from Bank of America. Your mic is now unmuted; you may now go ahead.

Adrien De Saint Hilaire: Thank you very much. Good evening, everyone. So maybe to follow up on the questions that were asked before. So you've set a new ceiling for the buyback at €16. I think currently you're not actually buying shares above €11. So can you tell us a bit more where you consider the right level to be for acquiring shares? Is it conceivable that you actually buy shares between a share price of $11 and $16? That's the first question. The second question is if you could say whether or not you consider to Vivendi to be a long-term holder of Universal Music Group? I think there's a level at which you could exit. And then thirdly, you're currently trying to build a book publishing business with entities and the acquisition of Lagardère. I was just wondering if you could comment as to why you think book publishing is an attractive industry and whether or not you think the overall valuation of publishing for you can mirror what you've done with UMG over time. Thank you.

Hervé Philippe: I will take the first one and Arnaud will take the second one. Well, we have taken advise of €16 per share for the buyback program beginning -- after the current price of €29. So it begins in December and we have taken very simply this figure of €16 because it is based on multi-criteria analysis, but it corresponds to the consensus of target price of the analysts. So this is why we have chosen this figure. Indeed, we prefer to buy back shares when the market is low and you have seen that we have bought recently some shares and this will be re-bought every day to the [Indiscernible] when we buy back shares. Arnaud.

Arnaud de Puyfontaine : So on your second question, as you know, we took the commitment to keep the stake in Universal Music Group until early 2023. As far as the short-term, we are happy about the numbers which have been released last week. You know that we think that Universal Music Group is a company that is going to go from strength to strength. And the numbers which have been disclosed are true illustration of what we do think about the business. So that's as regard to Universal Music Group. Now your question about book publishing. I do remember the comments which were made by some of the people following the Vivendi stock when we bought Editis. And we said at the time that we thought that there was -- that was an industry which had some growth perspective and which was very consistent within the strategic Vivendi road map. Well, with the benefit of our insights, I'm happy to say that the numbers that we have shared with you, not only '21 compared to 2020, which was a very peculiar year due to the pandemic, but compared to 2019 is proving us right. It's proving us right because we are optimistic about the prospect of the industry. We have seen great growth of the industry in France in 2021, with an average growth of the industry, 21%, in France, it's more than €4 billion market, the publishing and the different category. And we are thrilled about the perspective to move on to the next step for us, which we shared with you two years ago, which is to take the opportunity to build a worldwide player and this is exactly what we are intending to do as regard to Lagardère. Not only we are bullish as regards to the perspective of the book publishing industry, we do also see an opportunity to accelerate all the common project within the group and I'm happy to report that as far as we speak, we have got multiple initiatives alongside the different business line across the group of initiatives based on creative ideas coming from books. So currently you got, for instance, within Studiocanal more than 10 project based on film production, TV series production which are based on the creative positioning, which was in French novel. We're very happy to see that some of our authors are getting into the production of theatre and so on and so forth. I'm not going to open the at least to the prevail, but we do see those kind of a relationship between the different line of business being part of our strategy. So we think that as regard to this part of our operation, as we like to say, the best is yet to come.

Operator: Thank you so much for your question. And the next question is coming from the line of Omar Sheikh from Morgan Stanley. Your line is now un -muted. Now go ahead.

Omar Sheikh: Thank you very much and good evening, everyone. I just got a couple of questions if I may. If I could maybe start I don't know with the long-term strategy for the group if possible. And you mentioned in your prepared remarks that and you talked a number of times in the Q&A also about working together as an industrial -- integrating industrial group. So I just wanted to clarify, does that apply to the consolidated businesses only or does that also include the portfolio listed and shares because I guess when you look through the list of the shares that you currently own, there are potentially opportunities for you to work together with the consolidated businesses. I wonder whether you could maybe just talk a little bit about whether you can see any synergies from the shares that you own. That's the first question. And I guess related to that and following up on perhaps Adrien 's question just now, can you just clarify whether you would anticipate continuing to earn UMG shares beyond early 2023? That's the second question. And then thirdly, I just want to maybe back on Ukraine if possible. I know it's early and I'm sure it's not possible to quantify at this point, but could you -- maybe, Hervé, could you talk about where we might potentially anticipate some impact on your business from, for example, this month we're seeing commodity prices? Is that just going to be in the advertising-related partner business Havas and Canal + maybe or could it be elsewhere as well? If you could give us some color on that, that will be very helpful. Thank you very much.

Arnaud de Puyfontaine : Thank you. Omar, for your question. So point number one, we do see those collaborations between the different operation not only within our fully-owned operation, but also in initiatives as regard to some partners we are working on. So if you take, for instance on the [Indiscernible], we've got in terms of prediction, different initiatives. They are producing. a few program for networks within the [Indiscernible] and so on and so forth. If you take the relationship with Telefonica. With Telefonica, we've got different initiatives as regard to the synergies that we can see between the Telefonica and Prisa because as within Prisa, Telefonica is also a shareholder. And in the digital transformation, the company we want to be able to push forward the competitive advantage based to the common vision and align the strategies that we want to implement. If you take, obviously, Telecom Italia. Telecom Italia, we are an industry old shareholder. We do see interesting opportunities and we have started to develop some common project with Telecom Italia. And again, these industrial statuses that we want to push forward, just incentivize in the way we worked with the different teams within companies where we have a stake, to push all potential common initiatives to create value for both partners. That's on your first question on UMG. We know what is the situation as of to date. There is no decision in any shape or form taken as regard to the mid to long-term position. We keep all the potential options opened. And then last but not least, and I will hand over to Hervé, is as regard to this dramatic situation in Ukraine. Based on the the operation for business region and the level of business we generate, it's no impact per se in the group. But obviously, what it does create in terms of impact, that macro economic or micro economic in our business. Well, we do see currently some impacts that we have already anticipate in, for instance, paper price, because in the book publishing or ADT's, we have obviously the impact of this increase of paper, but we are in a good position because we got the size and we've got the negotiating power, which protects us from the short-term impact, but we have to manage the uncertainty around this. In terms of the impact on the advertising market we will manage and as we've seen in the past, you have seen the results the last year and this year of Havas. Havas is extraordinarily agile company and taking benefit from growth environment as regard to the numbers and the capacity to be the best partner for our clients in terms of riding through growing environment, but at the same time when the times are getting tougher, we adjust our operations to be able to ride through the storms. So sorry if I can't be anymore specific, but obviously we are monitoring the consequences of what's currently happening on a day-to-day basis. And in our risk management process and structure and also in terms of the way we plan for operations, we take a very cautious position and we plan for the different scenario to be able to ride the from -- through efficiently through those uncertain time. But, Hervé, do you want to add something?

Hervé Philippe: No. I fully agree with what you just said. Direct impact on our figures is very limited because revenues in Ukraine and Russia are very limited and less than 0.1% of the total revenues of the group. But we have people working in Ukraine, so we are very cautious for them and we support them in indeed what we can do. We can also say that we have an internal working group on the possible risk on Ukraine and consequences and we will work on that indeed. Thank you.

Operator: Thank you for your question. The next question is coming from the line of Julien Roch from Barclays. Julien, your line is now un -muted and may now go ahead.

Julien Roch: [Indiscernible]. So my first question is on the buyback, you were asked by Ether Yen about whether you were -- sorry, by Lisa Yang, whether you buyback above 11 and your answer was, we prefer to buy low. And also, every time we buy good on the NFV website. So last week for the first time since November, you actually proceeded with a buyback, but below 11. Since then, on the day where the share price was above 11, available initiatives or not, that's my first question. The second one is when do you see you can break even on Vivendi Village, your new initiative. I know you told Lisa you we're not giving a full-year '22 EBITDA guidance, but those business have never made money. So curious to know whether they will lose money forever or not? These are my two questions. Thank you.

Arnaud de Puyfontaine : For first, for the buyer buyback, it would be very simple for you to look at our disclosure and to understand that we bought shares back when the prices is under €11. So this was the case in the way from past, and I think this is a good result to have today if the stock price -- general condition of the market declines and you have seen many volatilities in the various on past, with such volatility, we can buy when the stock is particularly low and this is a good thing, in my view. And when we bought regularly, the shares, we buy back. Onto break even of Vivendi Village and the new initiatives, I would say for Vivendi Village I believe that it will be directly linked to the ticketing activity and the live activities in festivals in all the territories where Vivendi Village is, and also L’Olympia. All those businesses were largely hit buys pandemic and we believe that in 2022, we will be in a much better situation for Vivendi Village. For GVR, we are on a more long-term view. I would say, and we do believe that we create a lot of value, both at GVR, Dailymotion and that we will be breakeven soon. Maybe it will take a little bit more times than Vivendi Village, but we are very good hopes to create value with those two businesses in the coming years.

Operator: Thank you for your question. And the next question is coming from the line of Richard Eary from UBS. Your line is now unmuted and may now go ahead.

Richard Eary: I have a number of questions, if possible. Just -- the first one, just as we think about the book publishing business and we look at Editis and Lagardère together, can you talk through maybe potential synergies that might come out of that by putting these businesses together over the medium-term and how we should think about that? That would be the first question. The second question is, can you give us an update on Telecom Italia, what your position is there? And obviously, that would be helpful. Third question is just on Canal. Is it -- I know you haven't really talked about this historically. Is there any way that you can give us some more color on the profitability between mainland France and the international assets so we can just get a sense in terms of where the profitably lies between -- within Canal? That would be great. Thanks.

Arnaud de Puyfontaine : Thank you. So on the book publishing and the synergies, well, the intention and the strategic vision is to build a worldwide player and to bring together the operation. As regard to the current situation besides the tender offer process, we have the anti-trust process. We are having daily interaction with Brussels. And obviously there are going to be some remedies that will have to be applied in a few months’ time. After we have the conclusion, the work that we are currently doing with the anti-trust authority. But as soon as we are in a position to be able to proceed with the strategic plan and bringing together the business or part of the business, well obviously you've got some synergies, which is synergies based on paper price, distribution costs, relationship with a key partner on the strategic level. Obviously, when you got a global reach, you have the possibility to engage with offered to provide them with a level of service, which is much greater than when you are only a local player. So there is substantial common initiative, that in due time when we are in a position to complete the transaction with the blazing of the enter authority, we get the opportunity to bring -- implement the synergies and we'll be obviously very happy to share more in detail the level of those synergies. While the situation on Telecom Italia is a situation where there had been the number released for 2021 with the level of impairments, obviously, it's back to square 1 as regard to the situation. The impairment is a combination of some fiscal consequences, but also of a situation of a company that lost control from the previous team. And the good thing with regard to the future is that now there is a leader, Pietro Labriola, who has built a team and that has presented to the board a plan which is fully back backed by Vivendi. The new plan is grounded in reality. It should allow the domestic activities to bounce back and bring out intrinsic value of Telecom Italia asset. It's a combination of capacity to engage with regard to the management of the revenues in a more articulated and more I would say a professional way to be able to develop the ARPU in the different parts of the business. But also it's the capacity to work on the supply chain and the cost base. And I do see the current plan as grander than reality. And we do think that again, I'm repeating myself, we do see Telecom Italia as under the new leadership in a position to be able to at last be in a position to deliver on its promises and to get to a value which is much higher than the current share price, obviously, and which obviously will be able to bring back the company where it should be. Obviously, there are many mid-term options strategically, which Pietro Labriola is -- and his team is working on. It depends on the capacity to engage with potential partner in the Italian market. We're still waiting for more commitment from those partners. But as Vivendi, obviously, we are currently keeping all potential options open as regard to what we may be doing in the future. But in the end, and as far as we're concerned, the situation is, Pietro Labriola when you see his track record in Brazil, which has been outstanding, and the capacity to navigate in terms of operation in the quite complex markets. The latest situation being the oil situation and what is currently happening that is going to bring market repair and the possibility really to open a new chapter of the telco operation in Brazil. I'm expecting Pietro's touch to get the same impact in Italy and that's the reason why, as a long-term investor in a country which is strategic for us and based on the, I would say, I think [Indiscernible] that is that is currently existing between Vivendi and Italy and the different player be it the regulators, the government, and other key players in the industry. I want to remain pragmatically optimistic as regard to the point that we come to a new beginning. And this is what I'm sure the team in [Indiscernible] is going to deliver. And obviously I'm expecting a share price to bounce back and to be at the level of what is going to be the performance delivered by the team in this new chapter. That's for Telecom Italia. And maybe I'm going to hand over to you, Hervé.

Hervé Philippe: We do not disclose the split between the profitability of international activities and mainland France for Canal +. But if you want me to give you some color on that, as you asked, it's easy to say and to understand that the profitability is much better at international level of activities than in France. In international activities we are in a growing part of the business. There is some -- a lot of work which is done in cost optimization and IT. I think that we can see in the future further improvement in the profitability in this part of the business. In fact, it's much more complicated even teams have done a great job in terms of the efficiency of cost control of cost reduction. There are many, many constraints in France which make it very difficult to be profitable in this part of the business.

Richard Eary: Thank you very much.

Operator: Thank you for your question. The next question is coming from the line of Matthew Walker from Credit Suisse. Your line is unmuted. You may now go ahead.

Matthew Walker: Hi, thanks a lot for taking the call. I've two questions, please. The first is, are you expecting a high, and given the H2 performance, are you expecting a higher-margin will have in '22 compared to '21? And then the second question is, you've had the OPRA authorization for a while. Can you just sort of discuss what are the sort of triggers or potential triggers for using the OPRA? Thank you.

Arnaud de Puyfontaine : We have the authorization on our part. We have authorization, which has been given last year by the shareholders. And there is no specific decision taken yet to make on our notes. And the Board will discuss that later on. If obviously -- if there is a decision taken, it will be publicly announced that at that time. For Havas, you have seen great improvement. For mountains, low-margin, no have asked 21. I know very well this business and I assure you that when there is cost reduction program when you have a very good activity in terms of profitability at cost reduction of asset. And we believe that our ambition is to continue to increase the personal profitability and to improve it significantly in the future. And we were very proud of the present Havas and we hope to be better next year. Thank you.

Operator: Thank you so much. The next question is coming from the line of Conor O’Shea from Kepler You are now unmuted and may now go ahead.

Conor O’Shea: Yes, thank you. Good evening and thank you for taking my questions. Just a quick question to come back on the OPRA. Again, obvious you mentioned that it would be submitted to the shareholders at the AGM. Can you confirm, is that again for 50%, up to 50% of the share capital, or 25%? And also just regarding the maximum buyback price, I think you're selling at 16, so I think it's a big change from the previous policy of setting it quite close to the share price -- the current share price, so can you give us your thinking there as why there's such potential spread? Between that and the current share price and where you are currently prepared to buy back shares. And then second question on Editis, could you just explain why, what was driving the acceleration in organic growth in Q4 versus the previous quarter? I had understood that the education part of the business was not benefiting from any reforms and the fiction part of the business was facing tough comps coming out of lockdowns and so on. So just wondering what was happening there? And then just a final question, just on the holding company costs for the full year, they were much lower than in the previous years, is €110 million a good base to forecast for next year or were there some exceptional offsets holding that number down? Thank you.

Hervé Philippe: To take those question necessarily in the same order. For the holding company, the costs this year were positively impacted by some effect from provisions from pensions we can say. So unfortunately, we can expect for next year another level for 2019 and 2020 and 2021. So for the opera, yes, it is 50% of the solution, is 50%. And for the price -- the buyback, we were -- we started selling in terms of -- for €29 per share last year. So we decreased that considering that we have made the distribution of UMG on us. This association is valid for 18 months. We believe that we have take some flexibility I would say in this result. For ADT's on the Q4, do you want to -- I think we have made very good performances in Q4, especially in the distribution part of the business. At ADT's, for example, we had distribution of the [Foreign Language]. And we were -- we had also the top three illustrated books.

Arnaud de Puyfontaine : So we had very good books to distribute at the end of the year in the fourth quarter, as we explained, are part of the excellent performance of Editis. And also if I can add, this performance in the market which has grown, because as mentioned previously in one of my answer, there is a new appetite for books. So you've got money, you've got a market, which is a market which is growing quarter after quarter. And we're benefiting from this global good health of the book publishing industry. In France, also triggered by what is so called Pass Culture, which is an amount of money provided for young people to be spent in culture product consumption and part of this usage, as I would say, stimulated the growth of the market in the fourth quarter.

Operator: Next question is coming from the line of from [Indiscernible] Deutsche Bank. This is the final question in the queue. Sofia, you may now go ahead.

Q –Unidentified Analyst: Thank you and good evening, everyone. My first question is on the group leverage, in the medium-term. Can you please sir, any thoughts on how the Group leverage, as well as the liquidity profile would change once you take on the [Indiscernible] debt? And whether you still think that you would have room for side M&A? And then second question is on [Indiscernible] Can you please these costs, your thoughts about the organic growth outlook for 2022, considering agency piece that have reported so far pointed to somewhere around 4% to 5%. And then maybe just a final quick one on Canal +. With Paramount + set to launch in France later this year as part of the bundle with Canal. Can you please talk about the potential partnering impact of these partnership in terms of, for example, ability to raise prices or attack and retain subscribers in France? Thank you.

Hervé Philippe: Thank you for our question. For Canal + and Paramount it's not possible to give any precise guidance on the additional subscribers we have with that bundle, but it is to show that we continue to offer the best possible content to the subscribers at Canal + and give them all the possibility to see and to have bundles of content with different offers and to have their Canal + and myCanal platform as a possibility to see a lot of programs even done by other partners, I would say. For Havas for the organic growth, we do not give any guidance for organic growth at Havas. I just can tell at the beginning of the year it's very encouraging and that we have won a lot of new client at the end of '21, which normally a good positive impact on some of the following year, I would say. So this is -- we're optimistic for Havas. This year, it will obviously depend on the economic situation in the world in the coming months. For your question regarding the debt, we believe that we have today a very appropriate level, I would say of debt. We do not intend to issue new debt. We have enough cash at the balance sheet and enough liquid assets to [Indiscernible] the level of the debt. Generally speaking, on the mid-term, I would say, we have to keep an equilibrium between the debt and the EBITDA, which is two times to 2.5 times, is fair, but we are largely beyond that in terms of net debt to debt. Thank you.

Operator: Thank you for your questions everyone. And the Q&A is now over, we'd like to send you back over to your host in today's call.

Arnaud de Puyfontaine : Well, I would like to say a word, if possible. I think I would like to put the release this evening in the context of previous comments. There was a question as regard to what is going to happen to Vivendi post UMG operation. I guess that's the level of performance that we have disclosed on 2021 is a good base, a good foundation to be able to be on a solid ground, to be able to write the story that is based on the strategy that we, Yanic Bollore and the management board wants to write in the future, we have shown in every of operation growth. We have growth in our revenue base. We have growth in our EBITDA. And as regard to what Vivendi stands for post UMG, we are, this evening beginning a new journey, which shows that the strategy is proving to be right and delivering perspective on the solid foundation. So I hope that this is something that will be taken as a kind of learning from these results disclosure. Thank you for being there, thank you for your question, your attention, and very much looking forward to see you on the next results presentation. Herve?

Hervé Philippe: Thank you very much to everybody and have a nice evening. Bye bye.

Operator: Thank you everyone for joining us on today's call. You may now disconnect your handsets. Host, please stay connected.