NZME Limited · NZX:NZM
NZME — FY2020 Earnings Presentation
38 slides from NZME's earnings presentation, Feb 24, 2021
Slide 1: Everyone's Here
For personal use only 24 February 2021 EVERYONE’S HERE
Slide 2: Agenda
AGENDA For personal use only Results Summary 3 Covid-19 Recovery 4 Market Dynamics 5 Divisional Performance and Strategy 8 2020 Full Year Financial Results 23 Outlook 29 Q&A 30 Supplementary Information 32 2
Slide 3: Results Summary
RESULTS SUMMARY $331.2m $67.3m For personal use only Operating Revenue1 Operating EBITDA1 For the full year ending 31 December 2020 2019 $371.7m 11% 2019 $65.7m 3% • Earnings growth achieved through delivery of strategic priorities $14.2m $22.0m and swift action in response to Covid-19: • Year-on-ye
Slide 4: Swift Actions in Response to Covid-19
SWIFT ACTIONS IN RESPONSE TO NZME Total Advertising Revenue Growth YoY For personal use only COVID-19 10% 4% 2% 0% -2% -3% • NZME’s advertising revenue was down 15% in 2020 however, it returned to growth at the end of the year, with financial results -6% -10% assisted by the significant actions take
Slide 5: For personal use only
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Slide 6: Agency Advertising Market and NZ Business Confidence
AGENCY YoY NEW ZEALAND ADVERTISING BUSINESS For personal use only MARKET CONFIDENCE 20% Rugby World Cup 20 15.0 9.4 10.4 10 Net Index (% expecting improvement minus % expecting deterioration) 10% 6.0 3.5 4.8 Year-on-year monthly agency 2.0 2.4 1.1 0 0% revenue growth %1 -10 (6.9) (2.4) (0.9) (1.5) (
Slide 7: NZME Performance Compared to the Market
NZME PERFORMANCE COMPARED TO THE MARKET. NZME continues to outperform the market For personal use only in all four pillars. 2020 Total Segment Revenue $317.3m Digital Print Other Subscriptions $7.6m 2% $6.6m 2% Print circulation (YoY growth) Radio advertising (YoY growth) NZME print circulation reve
Slide 8: Divisional Performance and Strategy
DIVISIONAL PERFORMANCE ~ AND STRATEGY FOfpersoness
Slide 9: NZME – An Audience and Customer Centric Multi-Channel Media Business
NZME – AN AUDIENCE AND CUSTOMER CENTRIC MULTI-CHANNEL MEDIA BUSINESS For personal use only 32 print publications 9 audio brands #1 25-54 year-old #1 Daily newspaper in NZ1 breakfast show in NZ2* Now over 102,000 digital NZ’s #1 radio station and subscribers favourite breakfast talk show2 17 websites
Slide 10: New Divisional Reporting Framework
NEW DIVISIONAL REPORTING FRAMEWORK For personal use only OLD Total NEW Audio Publishing OneRoof Other Total Print Reader Radio Advertising Digital Other Total Revenue Total Revenue Operating Expenses: People and contributors Operating Expenses: Print and distribution People and contributors Print an
Slide 11: Audio Listeners and Market Share
AUDIO LISTENERS AND MARKET SHARE For personal use only NZME Radio weekly listeners NZME Talk Radio – NZME Music Radio – iHeartRadio Average Monthly –Total including partners1 Major Markets All 10+ Share2 Major Markets 25-54 Share3 Total Listening Hours (million)4 6.0 2,100 15 30 Closure 14 of Radio
Slide 12: Audio
AUDIO $ million 2020 2019 % change For personal use only Radio advertising 91.6 108.5 (16%) Digital audio advertising 2.4 1.7 45% Other 5.6 1.8 213% For the full year ending 31 December 2020 Audio revenue 99.6 111.9 (11%) People & Contributors (50.0) (54.0) (7%) • Radio revenue commenced the year in
Slide 13: Audio Strategy: New Zealand's Leading Audio Company
AUDIO STRATEGY: NEW ZEALAND’S LEADING AUDIO COMPANY For personal use only Create New Zealand’s Grow broadcast and Grow market revenue best local audio content digital reach share and digital revenue 2020 Metric 2023 Target 2021 Initiatives Achievement • Grow 10+ audience market share, focused on key
Slide 14: Publishing Brand Audience
PUBLISHING BRAND AUDIENCE For personal use only NZ Herald (Mon-Sat) and Herald on NZ Herald Daily and Weekly NZME Total Monthly Digital Users2 Sunday Average Issue Readership1 Brand Audience2 Daily Brand Audience Weekly Brand Audience NZME Total nzherald.co.nz NZ Herald Herald on Sunday 3,000 2,100
Slide 15: Publishing Subscribers
PUBLISHING SUBSCRIBERS For personal use only Print Subscriber Volume and Yield1 Subscriptions Mix Digital Only Subscriptions Volume & Yield Subscriber Volume Yield Print Only Print Entitled Digital Only Digital Subs Volume Digital Subs Yield 180,000 60,000 $250 14.0 1.80 160,000 12.0 1.70 50,000 140
Slide 16: Publishing
PUBLISHING $ million 2020 2019 % change Print subscriptions 55.8 55.3 1% Digital subscriptions 6.6 1.7 297% For personal use only Retail outlet sales 16.9 21.0 (20%) For the full year ending 31 December 2020 Total reader revenue 79.3 78.0 2% • Growth in total reader revenue of 2% with significant gr
Slide 17: Publishing Strategy: New Zealand's Herald
PUBLISHING STRATEGY: NEW ZEALAND’S HERALD For personal use only The #1 News brand for all Be a safe, scalable destination Subscriber first New Zealanders for advertisers 2020 Metric 2023 Target 2021 Initiatives Achievement More than 210,000 • Continue to actively sell print subscriptions and improve
Slide 18: OneRoof Audience & Listings
ONEROOF AUDIENCE & LISTINGS For personal use only OneRoof Auckland and national residential OneRoof Monthly Unique Online OneRoof Average Digital Listings for-sale listings as a % of Trademe1 Audience2 Upgrade % 600 14.0% % National % Auckland 120% 12.0% 500 100% 10.0% 400 Audience (000’s) Upgrade %
Slide 19: OneRoof
$ million Print 2020 13.4 2019 17.3 % change (23%) ONEROOF For personal use only Digital 4.3 2.8 53% For the full year ending 31 December 2020 Other 0.9 0.2 390% • OneRoof print revenue significantly impacted by Covid-19 in some months, however returned to growth in Q4 (see below). OneRoof revenue 1
Slide 20: OneRoof Strategy: Your Complete Property Destination
ONEROOF STRATEGY: YOUR COMPLETE PROPERTY DESTINATION For personal use only Strengthen core residential Be indispensable to agents Expand the portfolio listings business 2020 Metric 2023 Target 2021 Initiatives Achievement • New leadership structure with dedicated Head of OneRoof, focused singularly
Slide 21: GrabOne
GRABONE For the half year ended 30 June 2020 For personal use only $ million 2020 2019 % change Revenue 9.0 9.8 (8%) People & Contributors (3.6) (5.0) (28%) For the full year ending 31 December 2020 Agency Commission & Marketing (0.9) (0.8) 18% • GrabOne, now classified as a held-for-sale asset, Con
Slide 22: Corporate & Other
CORPORATE For the half year ended 30 June 2020 For personal use only $ million 2020 2019 % change & OTHER Revenue 2.4 4.9 (30%) People & Contributors (3.4) (4.4) (22%) Agency Commission & Marketing (0.3) (0.7) (55%) For the full year ending 31 December 2020 Content (0.5) (0.6) (12%) Other (3.2) (4.6
Slide 23: For personal use only
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Slide 24: Operating Results
$ million 2020 2019 % change OPERATING RESULTS Segment revenue 317.3 363.7 (13%) For personal use only Other revenue 13.8 8.0 73% For the full year ended 31 December 2020 Operating Revenue1 331.2 371.7 (11%) Operating expenses1 (263.8) (306.0) (14%) • Operating EBITDA1 grew 3% in 2020. Operating EBI
Slide 25: Expenses
EXPENSES $ million 2020 2019 % change People and contributors 139.2 153.8 (10%) For personal use only Print and distribution 46.5 57.6 (19%) For the full year ended 31 December 2020 Agency commission and marketing 34.7 43.6 (21%) • People and contributors and content expenses Content 14.9 16.8 (11%)
Slide 26: Balance Sheet
BALANCE SHEET $ million 31 December 2020 31 December 2019 For personal use only Trade, other receivables and inventory 45.4 54.4 Trade and other payables (43.8) (51.5) As at 31 December 2020 Current tax (payable)/receivable (1.6) (0.3) • Decrease in trade, other receivables and inventory primarily d
Slide 27: Cash Flows
$ million 2020 2019 CASH Operating EBITDA1 67.3 65.7 FLOWS For personal use only NZ IFRS 16 interest paid on leases (4.8) (4.8) For the year ended 31 December 2020 Interest received 0.1 0.1 • Operating1 cash flows increased $9.9 million Interest paid on bank facilities (3.1) (4.7) in the year to $56
Slide 28: Capital Management
CAPITAL MANAGEMENT 31 December 2020 31 December 2019 12-months Operating EBITDA (pre NZ IFRS For personal use only 53.0 50.6 16)1 For the year ended 31 December 2020 Interest Expense 2.9 4.4 • Capital management plan is to reduce debt Net interest cover (Operating EBITDA (pre 18.1 11.5 while maintai
Slide 29: Outlook
We continue to remain alert to the ongoing impacts of Covid-19 and the future For personal use only economic environment and changing market dynamics. While business confidence has improved significantly, advertisers remain cautious regarding their placement of advertising, with more bookings being
Slide 30: For personal use only
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Slide 31: For personal use only
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Slide 32: Supplementary Information
For personal use only 32
Slide 33: Our Sustainability Commitment
OUR SUSTAINABILITY COMMITMENT For personal use only 33
Slide 34: 2020 Divisional Performance
2020 DIVISIONAL PERFORMANCE For the full year ended 31 December 2020 Cost pools that relate to For personal use only $m Audio Publishing OneRoof GrabOne Other 2020 Total 2019 Total % Change multiple divisions have Reader Revenue: been allocated based on - Print - 72.7 - - - 72.7 76.3 (5%) revenue, g
Slide 35: Reconciliation of Operating Results to Financial Statements 2020
RECONCILIATION OF OPERATING RESULTS TO FINANCIAL STATEMENTS For personal use only For the 12 months ending 31 December 2020 12 MONTHS ENDED 31 DECEMBER 2020 $ million Operating Results NZ IFRS 16 Operating Results Exceptional and Per Financial excl. NZ IFRS 16 Adjustments incl. NZ IFRS 16 Other Item
Slide 36: Reconciliation of Operating Results to Financial Statements 2019
RECONCILIATION OF OPERATING RESULTS TO FINANCIAL STATEMENTS For personal use only For the 12 months ending 31 December 2019 12 MONTHS ENDED 31 DECEMBER 2019 $ million Operating Results NZ IFRS 16 Operating Results Exceptional and Per Financial excl. NZ IFRS 16 Adjustments incl. NZ IFRS 16 Other Item
Slide 37: For personal use only
The information in this presentation is of a general nature and does not constitute financial product advice, investment advice, legal, financial, tax or any other recommendation or advice. This presentation constitutes summary information only, For personal use only and you should not rely on it in
Slide 38: Everyone's Here
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