Technicolor unveils Drive 2020

Frederic Rose

France-based TV technology company Technicolor has unveiled a new strategic plan aimed at capturing growth opportunities in the media and entertainment services market, creating relevant new and valuable IP assets in media and entertainment from direct research investments and its operating businesses, and deepening the competitive advantages of its operating businesses.

The group said it would expand its patent licensing platform and develop new licensing models. For its M-GO streaming service, Technicolor said it would expand its offering, building greater scale, and increasing geographic reach, organically and via partnerships.

Technicolor said it would also grow its production service and technology platform from its current position in creative skills and technology to capture share in growing film, TV and advertising segments and expand in OTT, games and animation markets.

For the connected home segment, the company will seek to strengthen its efforts in emerging markets, particularly in Asia. The group will also aim to build on its current key customer relationships and product development expertise to provide a broader range of products and services, including OTT devices.

The Group aims to reach an adjusted EBITDA of around €400 million and a free cash flow comprised between €160 million and €200 million in 2017, which will be the low point in terms of financial performance due to the end of the MPEG-LA licensing programme.Technicolor has set the objective to return by 2020 to an adjusted EBITDA above €500 million with a free cash flow in excess of €250 million.

Technicolor posted Q4 revenues of €981 million, up €22 million, driven by direct licensing revenue, and net income of €128 million.

“I am extremely proud of the work done by everyone in Technicolor to deliver a fantastic performance in 2014 resulting in a positive net income and the initiation of a dividend.  As we now embark on our Drive 2020 strategic plan, we will remain fully focused on creating shareholder value as a leader in media and entertainment services, developing and monetizing video and audio technologies,” said CEO Frédéric Rose.