€471m market cap

€2.47 last close

Technicolor is a worldwide technology leader operating in the media and entertainment industry. Its activities are organised in three business segments, Production Services, DVD Services and Connected Home.

Investment summary

Technicolor’s FY20 results show it is on track to meet FY22 guidance, now adjusted for forex and the disposal of the post-production business. FY21 trading prospects are improved, with 75% of Production Services’ pipeline in place. Strong domestic broadband demand continues to buoy Connected Home, although the FY21 result may be dampened by delays from semiconductor shortages. Our forecasts align with guidance, which is for a marked margin uplift as revenues rebuild and the cost saving programme benefits kick in. FY20’s financial restructuring, coupled with the anticipated business improvements, should support cash flow generation and may act as a catalyst for an equity re-rating. The next update will be with the Q1 figures on 11 May.

Y/E Dec
Revenue (€m)
PBT (€m)
EPS (fd) (c)
P/E (x)
P/CF (x)
2019A 3800.0 325.0 (73.0) (492.18) N/A 0.5
2020A 3006.0 167.0 (43.0) (33.64) N/A N/A
2021E 2933.0 270.0 (3.0) (2.97) N/A 5.6
2022E 3255.0 385.0 117.0 42.67 5.8 2.0
Industry outlook

COVID-19 has highlighted the importance of reliable domestic broadband and high-quality wi-fi as homes increasingly act as devolved workplaces alongside greater content consumption. This is unlikely to change as the global economy reopens. In Production Services, the live content industry continues to re-emerge, while animation demand is still strong. Fresh, high-quality content will be crucial to reinforce the attractiveness of VoD platforms to subscribers and advertisers.

Last updated on 16/03/2021
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Share price graph
Balance sheet
Forecast net debt (€m) 837
Forecast gearing ratio (%) 709
Price performance
Actual 5.0 20.8 (77.4)
Relative* 2.3 14.6 (76.0)
52-week high/low €1.0/€0.2
*% relative to local index
Key management
Anne Bouverot Chairman
Richard Moat CEO
Laurent Carozzi CFO