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GRUPO TELEVISA, S.A.B. 6-K Analysis & Summary – 2/21/2025

⚠️This is not investment advice.

⚠️ This is an experimental project and this report is for informational purposes only and should not be considered investment advice. Conduct your own thorough research and consult with a qualified financial advisor before making any investment decisions. ⚠️

Grupo Televisa S.A.B.
,

Filing date:

02/21/2025

TLDR:

Grupo Televisa, S.A.B. reports fourth quarter and full year 2024 results, with consolidated revenue declining by 6.0% and a net loss attributable to stockholders of Ps.8,246.2 million.

ELI5:

Televisa made less money overall, especially from their Sky TV service, but they’re managing their money well and cutting costs. They’re trying to focus on better customers for their cable service, but some people are canceling their subscriptions.

Accession #:

0000895345-25-000075

Published on

Analyst Summary

  • Revenue decreased by 6.0% year-over-year to Ps. 62,260.9 million.
  • Operating Segment Income decreased by 7.5% year-over-year, with a margin of 36.9%.
  • Net Loss Attributable to Stockholders was Ps. 8,246.2 million.
  • Cable revenue decreased by 2.9%, but OCF increased by 37.9%, resulting in a 23.4% margin.
  • Sky revenue decreased significantly by 12.8% due to a 17.2% decrease in RGUs.
  • Net Debt (Ps. Million) was 59,647.9.

Opportunities and Risks

  • Opportunity: Focus on FTTH (Fiber-to-the-Home) expansion in the Cable segment.
  • Risk: Revenue decline in the Sky segment due to a decrease in RGUs.
  • Risk: Significant increase in ‘Other expense, net’ due to non-cash impairment adjustments.
  • Risk: Reliance on cost-cutting measures to maintain profitability raises questions about long-term growth strategies.

Potential Implications

Company Performance

  • The company’s focus on value customers and FTTH expansion could be positive long-term strategies, but the short-term financial results reflect a need for further improvement.
  • Profitability metrics such as operating profit margin and net profit margin remain negative, indicating ongoing challenges in achieving profitability.

GRUPO TELEVISA, S.A.B. – SEC Filing Report (Form 6-K) – February 20, 2025

Executive Summary

This report analyzes Grupo Televisa’s Form 6-K filing, released on February 20, 2025, which details the company’s fourth quarter and full-year 2024 financial results. The overall assessment is cautiously neutral. While Televisa demonstrates strong cash flow generation and cost-cutting measures, revenue declines, particularly in the Sky segment, and significant non-cash impairment charges raise concerns. The company’s strategic shift towards “value customers” in the cable segment, while potentially beneficial long-term, is currently resulting in subscriber disconnections. The significant increase in debt due to currency depreciation is also a point of concern.

Recommendation: Hold. Monitor the performance of the Cable segment’s “value customer” strategy and the stabilization of the Sky segment. Further analysis of TelevisaUnivision’s performance is also crucial.

Company Overview

Grupo Televisa, S.A.B. is a major telecommunications corporation in Mexico, operating cable companies and a direct-to-home satellite pay television system (Sky). It also holds concessions for broadcasting programming and is the largest shareholder of TelevisaUnivision. The company operates primarily in two segments: Cable and Sky. Recent developments include the spin-off of the Other Businesses segment in January 2024.

Detailed Analysis

Management’s Narrative (MD&A)

Management highlights strong free cash flow generation and cost efficiencies. The narrative acknowledges revenue declines, particularly in the Sky segment, attributing them to a decrease in RGUs (Revenue Generating Units). The focus on “value customers” in the Cable segment is presented as a strategic move, despite current subscriber losses. The MD&A also mentions non-cash impairment adjustments in the Sky and Cable segments, indicating potential challenges in those areas.

Red Flags: The significant increase in “Other expense, net” due to non-cash impairment adjustments warrants further investigation. The reliance on cost-cutting measures to maintain profitability raises questions about long-term growth strategies.

Financial Statement Analysis

Consolidated Income Statement

* Revenue: Decreased by 6.0% year-over-year (YoY) to Ps. 62,260.9 million.
* Operating Segment Income: Decreased by 7.5% YoY, with a margin of 36.9%.
* Net Loss Attributable to Stockholders: Ps. 8,246.2 million, a slight improvement from Ps. 8,422.7 million in the previous year.
* Key Drivers: Revenue decline in Sky segment, offset by cost-cutting measures and a decrease in share of loss of associates and joint ventures.

Segment Performance

* Cable: Revenue decreased by 2.9%, but OCF (Operating Cash Flow) increased by 37.9%, resulting in a 23.4% margin. Focus on FTTH (Fiber-to-the-Home) expansion.
* Sky: Revenue decreased significantly by 12.8% due to a 17.2% decrease in RGUs. OCF increased slightly due to opex and capex savings.

Key Ratios and Trends

| Metric | 2024 | 2023 | Change |
| ————————— | ——– | ——– | ——— |
| Revenue Growth | -6.0% | N/A | N/A |
| Operating Income Margin | 36.9% | 37.7% | -0.8% |
| OCF Margin (Consolidated) | 22.7% | N/A | N/A |
| Net Debt (Ps. Million) | 59,647.9 | N/A | N/A |

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Financial Ratio and Metric Analysis

Profitability

  • Gross Profit Margin

    • Ratio/Metric: Gross Profit = Revenue – Cost of Revenues. Gross Profit Margin = (Revenue – Cost of Revenues) / Revenue. 2024: (62,260.9 – 41,117.1) / 62,260.9 = 34.0%. 2023: (66,222.8 – 43,297.4) / 66,222.8 = 34.6%.
    • Trend: The gross profit margin decreased from 34.6% in 2023 to 34.0% in 2024, a decrease of 1.7%.
    • Industry: The Telecommunications industry typically has gross profit margins ranging from 30% to 60%. Grupo Televisa’s gross profit margin falls within this range.
  • Operating Profit Margin

    • Ratio/Metric: Operating Profit Margin = Operating Income / Revenue. 2024: (-2,843.1) / 62,260.9 = -4.6%. 2023: 1,857.8 / 66,222.8 = 2.8%.
    • Trend: The operating profit margin decreased significantly from 2.8% in 2023 to -4.6% in 2024.
    • Industry: The Telecommunications industry typically has operating profit margins ranging from 10% to 25%. Grupo Televisa’s operating profit margin is below this range.
  • Net Profit Margin

    • Ratio/Metric: Net Profit Margin = Net Loss / Revenue. 2024: (-8,309.3) / 62,260.9 = -13.3%. 2023: (-8,807.3) / 66,222.8 = -13.3%.
    • Trend: The net profit margin remained constant at -13.3% from 2023 to 2024.
    • Industry: The Telecommunications industry typically has net profit margins ranging from 5% to 15%. Grupo Televisa’s net profit margin is below this range.
  • Return on Assets (ROA)

    • Ratio/Metric: ROA = Net Loss / Total Assets. 2024: (-8,309.3) / 251,480.9 = -3.3%. 2023: (-8,807.3) / 262,670.3 = -3.4%.
    • Trend: The ROA slightly increased from -3.4% in 2023 to -3.3% in 2024.
    • Industry: The Telecommunications industry typically has ROAs ranging from 2% to 7%. Grupo Televisa’s ROA is below this range.
  • Return on Equity (ROE)

    • Ratio/Metric: ROE = Net Loss Attributable to Stockholders / Total Equity Attributable to Stockholders. 2024: (-8,246.2) / 102,419.0 = -8.0%. 2023: (-8,422.7) / 119,280.4 = -7.1%.
    • Trend: The ROE decreased from -7.1% in 2023 to -8.0% in 2024.
    • Industry: The Telecommunications industry typically has ROEs ranging from 8% to 15%. Grupo Televisa’s ROE is below this range.
  • Earnings Per Share (EPS) – Basic and Diluted

    • Ratio/Metric: Basic EPS = Net Loss Attributable to Stockholders / Weighted Average Shares Outstanding. The filing provides the net loss attributable to stockholders of the company, which is Ps. -8,246.2 million for 2024 and Ps. -8,422.7 million for 2023. The EPS is provided in the document. 2024: -3.03. 2023: -3.01.
    • Trend: EPS decreased from -3.01 in 2023 to -3.03 in 2024.

Liquidity

  • Current Ratio

    • Ratio/Metric: Current Ratio = Current Assets / Current Liabilities. 2024: 68,283.3 / 27,398.8 = 2.5. 2023: 62,104.5 / 34,890.8 = 1.8.
    • Trend: The current ratio increased from 1.8 in 2023 to 2.5 in 2024.
    • Industry: A current ratio of 1.5 to 2.0 is generally considered healthy. Grupo Televisa’s current ratio is within or above this range.
  • Quick Ratio (Acid-Test Ratio)

    • Ratio/Metric: Quick Ratio = (Current Assets – Inventories) / Current Liabilities. 2024: (68,283.3 – 463.2) / 27,398.8 = 2.5. 2023: (62,104.5 – 1,261.3) / 34,890.8 = 1.7.
    • Trend: The quick ratio increased from 1.7 in 2023 to 2.5 in 2024.
    • Industry: A quick ratio of 1.0 or greater is generally considered healthy. Grupo Televisa’s quick ratio is well above this range.
  • Cash Ratio

    • Ratio/Metric: Cash Ratio = Cash and Cash Equivalents / Current Liabilities. 2024: 46,193.2 / 27,398.8 = 1.7. 2023: 32,586.4 / 34,890.8 = 0.9.
    • Trend: The cash ratio increased from 0.9 in 2023 to 1.7 in 2024.
    • Industry: A cash ratio of 0.5 to 1.0 is generally considered healthy. Grupo Televisa’s cash ratio is within or above this range.

Solvency/Leverage

  • Debt-to-Equity Ratio

    • Ratio/Metric: Debt-to-Equity Ratio = Total Debt / Total Equity. 2024: 102,949.1 / 102,419.0 = 1.0. 2023: 88,535.9 / 119,280.4 = 0.7.
    • Trend: The debt-to-equity ratio increased from 0.7 in 2023 to 1.0 in 2024.
    • Industry: The Telecommunications industry typically has debt-to-equity ratios ranging from 0.5 to 1.5. Grupo Televisa’s debt-to-equity ratio is within this range.
  • Debt-to-Assets Ratio

    • Ratio/Metric: Debt-to-Assets Ratio = Total Debt / Total Assets. 2024: 102,949.1 / 251,480.9 = 0.4. 2023: 88,535.9 / 262,670.3 = 0.3.
    • Trend: The debt-to-assets ratio increased from 0.3 in 2023 to 0.4 in 2024.
    • Industry: The Telecommunications industry typically has debt-to-assets ratios ranging from 0.3 to 0.6. Grupo Televisa’s debt-to-assets ratio is within this range.
  • Interest Coverage Ratio (Times Interest Earned)

    • Ratio/Metric: Interest Coverage Ratio = Earnings Before Interest and Taxes (EBIT) / Interest Expense. EBIT = Operating (Loss) Income + Depreciation and Amortization. 2024: (-2,843.1 + 20,510.9) / 7,969.5 = 2.2. 2023: (1,857.8 + 21,107.3) / 7,742.1 = 3.0.
    • Trend: The interest coverage ratio decreased from 3.0 in 2023 to 2.2 in 2024.
    • Industry: An interest coverage ratio of 1.5 or greater is generally considered healthy. Grupo Televisa’s interest coverage ratio is above this range.

Activity/Efficiency

  • Inventory Turnover

    • Ratio/Metric: Inventory Turnover = Cost of Revenues / Average Inventory. 2024: 41,117.1 / ((463.2 + 1,261.3)/2) = 47.5. 2023: 43,297.4 / 1,261.3 = 34.3.
    • Trend: Inventory turnover increased from 34.3 in 2023 to 47.5 in 2024.
  • Days Sales Outstanding (DSO)

    • Ratio/Metric: DSO = (Accounts Receivable / Revenue) * 365. 2024: ((6,174.0 + 484.5) / 62,260.9) * 365 = 38.6. 2023: ((8,131.5 + 428.7) / 66,222.8) * 365 = 47.7.
    • Trend: DSO decreased from 47.7 in 2023 to 38.6 in 2024.
  • Days Payable Outstanding (DPO)

    • Ratio/Metric: DPO = (Accounts Payable / Cost of Revenue) * 365. 2024: (11,301.3 / 41,117.1) * 365 = 100.3. 2023: (12,861.1 / 43,297.4) * 365 = 108.4.
    • Trend: DPO decreased from 108.4 in 2023 to 100.3 in 2024.
  • Asset Turnover

    • Ratio/Metric: Asset Turnover = Revenue / Total Assets. 2024: 62,260.9 / 251,480.9 = 0.25. 2023: 66,222.8 / 262,670.3 = 0.25.
    • Trend: Asset turnover remained constant at 0.25 from 2023 to 2024.
    • Industry: The Telecommunications industry typically has asset turnover ratios ranging from 0.4 to 0.7. Grupo Televisa’s asset turnover ratio is below this range.

Valuation

  • Price-to-Earnings Ratio (P/E)

    • Ratio/Metric: P/E Ratio = Stock Price / EPS. Stock Price = $0.35. EPS = -3.03 (in pesos). Need to convert EPS to USD using an approximate exchange rate. Assuming 1 USD = 17 pesos, EPS in USD = -3.03 / 17 = -0.18. P/E Ratio = 0.35 / -0.18 = -1.94.
  • Price-to-Book Ratio (P/B)

    • Ratio/Metric: P/B Ratio = Market Cap / Book Value of Equity. Book Value of Equity = 102,419.0 million pesos. Market Cap needs to be calculated. Assuming 1 USD = 17 pesos, Book Value of Equity in USD = 102,419.0 / 17 = 6,024.6 million. Market Cap = Shares Outstanding * Stock Price. Shares outstanding is not provided.
  • Price-to-Sales Ratio (P/S)

    • Ratio/Metric: P/S Ratio = Market Cap / Revenue. Revenue = 62,260.9 million pesos. Revenue in USD = 62,260.9 / 17 = 3,662.4 million. Market Cap = Shares Outstanding * Stock Price. Shares outstanding is not provided.
  • Enterprise Value to EBITDA (EV/EBITDA)

    • Ratio/Metric: EV/EBITDA = Enterprise Value / EBITDA. EBITDA = Operating (Loss) Income + Depreciation and Amortization. 2024: -2,843.1 + 20,510.9 = 17,667.8 million pesos. EBITDA in USD = 17,667.8 / 17 = 1,039.3 million. Enterprise Value = Market Cap + Total Debt – Cash and Cash Equivalents. Market Cap = Shares Outstanding * Stock Price. Shares outstanding is not provided.

Growth Rates

  • Revenue Growth

    • Ratio/Metric: Revenue Growth = (Current Year Revenue – Previous Year Revenue) / Previous Year Revenue. (62,260.9 – 66,222.8) / 66,222.8 = -6.0%.
    • Trend: Revenue decreased by 6.0% from 2023 to 2024.
  • Net Income Growth

    • Ratio/Metric: Net Income Growth = (Current Year Net Income – Previous Year Net Income) / Previous Year Net Income. (-8,309.3 – (-8,807.3)) / -8,807.3 = -5.7%.
    • Trend: Net loss decreased by 5.7% from 2023 to 2024.
  • EPS Growth

    • Ratio/Metric: EPS Growth = (Current Year EPS – Previous Year EPS) / Previous Year EPS. (-3.03 – (-3.01)) / -3.01 = 0.7%.
    • Trend: EPS increased by 0.7% from 2023 to 2024.

Other Relevant Metrics

  • Cash and Cash Equivalents

    • Analysis: Cash and cash equivalents increased by Ps.13,606.8 million in 2024, primarily due to strong free cash flow generation. This represents a 38.4% increase compared to 2023.
  • Operating Cash Flow (OCF)

    • Analysis: OCF grew by 28.2% in 2024, resulting in a 22.7% margin. In Q4 2024 OCF increased by 37.9%, representing a 23.4% margin.
  • Revenue and Operating Segment Income (OSI)

    • Analysis: Revenue and OSI declined by 6.0% and 7.5%, respectively, in 2024, translating into a 36.9% margin. In Q4 2024 OSI margin of 39.0% incorporates savings from efficiency measures.
  • Homes Passed with Fiber-to-the-Home (FTTH)

    • Analysis: The company passed 365 thousand homes with FTTH in 2024, reaching more than 19.9 million homes passed with their network.
  • Broadband Subscribers

    • Analysis: The company has 5.6 million broadband subscribers, with 52.2 thousand disconnections as they focus on value customers and customer retention and satisfaction.
  • Total Revenue Generating Units (RGUs)

    • Analysis: Total RGUs of 5.1 million, with almost 1.1 million disconnections.
  • Opex and Capex Savings

    • Analysis: Opex and capex savings of 10.0% and 43.0%, respectively, drove OCF up by 2.7%, for a 20.6% margin.

Commentary

Grupo Televisa’s financial performance in 2024 shows a mixed picture. While the company experienced a significant increase in cash and cash equivalents and improved efficiency through Opex and Capex savings, revenue and operating segment income declined. Profitability metrics such as operating profit margin and net profit margin remain negative, indicating ongoing challenges in achieving profitability. The company’s focus on value customers and FTTH expansion could be positive long-term strategies, but the short-term financial results reflect a need for further improvement.

⚠️ This is an experimental project and this report is for informational purposes only and should not be considered investment advice. Conduct your own thorough research and consult with a qualified financial advisor before making any investment decisions. ⚠️