NZME Limited · NZX:NZM
NZME — Investor Day (November 2021)
152 slides from NZME's investor day presentation, Nov 18, 2021
Slide 1: NZME Investor Day
For personal use only A leading integrated media company NZME INVESTOR DAY 18 November 2021 1
Slide 2: Agenda
Agenda For personal use only 1. Chairman's Address Barbara Chapman, Chairman 10:00am – 10:10am 2. CEO Overview Michael Boggs, Chief Executive Officer 10:10am – 10:20am 3. Performance Overview David Mackrell, Chief Financial Officer 10:20am – 10:30am 4. Audio Jason Winstanley, Chief Radio Officer 10:
Slide 3: Chairman's Address
For personal use only 1. Chairman’s Address Barbara Chapman Chairman 3
Slide 4: Board Members
1. Chairman’s Address Board Members For personal use only Barbara Chapman Carol Campbell David Gibson Sussan Turner Guy Horrocks Independent Chairman Independent Director Independent Director Independent Director Independent Director 4
Slide 5: CEO Overview
For personal use only 2. CEO Overview Michael Boggs Chief Executive Officer 5
Slide 6: NZME reaches an audience of more than 3.4 million New Zealanders
2. CEO Overview NZME reaches an audience of more than 3.4 million New Zealanders1 For personal use only ~ 92% of the people living in Auckland1 > 88% NEWS of the people NZ’s #1 radio station 2.8 MILLION PEOPLE ENGAGE WITH OUR living in the and favourite NEWS CONTENT1 North Island1 breakfast talk sho
Slide 7: NZME brands part of New Zealanders' daily habits
2. CEO Overview NZME’s Digital, Audio and Print brands and platforms are part of New Zealanders daily habits For personal use only 6am – 9am 9am – 3pm 3pm – 7pm Wake up in The morning Get ready for Travel to Break from Working or Travel from After work the morning workout the day work or study work
Slide 8: A workplace that fosters innovation, engagement and inclusion
2. CEO Overview We provide a workplace that fosters innovation, engagement and inclusion For personal use only PROMOTING A HEALTHY, DIVERSE AND SAFE WORKPLACE We will embed a high performing health and safety culture and will regularly report on our performance. We will strive for a collaborative an
Slide 9: Executive Team
2. CEO Overview Executive Team For personal use only Michael Boggs Shayne Currie Paul Hancox Carolyn Luey David Mackrell Chief Executive Officer Managing Editor Chief Revenue Officer Chief Digital & Publishing Chief Financial Officer Officer Paul Maher Katie Mills Allison Whitney Matthew Wilson Jaso
Slide 10: 2023 Strategic Priorities were introduced in 2021
2. CEO Overview 2023 Strategic Priorities were introduced in 2021 For personal use only New Zealand’s New Zealand’s Your complete leading audio Herald property company destination 10
Slide 11: Strategic principles guiding delivery
2. CEO Overview These strategic principles have guided the delivery across the strategy For personal use only 1 Customer First 2 Win with Quality 3 Digital Acceleration 4 Audience Expansion 5 Top Performer • Keep Kiwis in the know • Premium, independent • New tools, technology • Scale NZ-wide brand
Slide 12: Delivering market share growth across all platforms
2. CEO Overview Delivering market share growth across all platforms For personal use only Total Radio Advertising Market Revenue and Total Print Advertising Market Revenue and Digital Display Advertising Market Revenue and NZME Share %1 NZME Share %2 NZME Share %3 300 42.0% 300 50.0% 164 27.0% 41.0%
Slide 13: Digital media strategy delivering revenue growth
2. CEO Overview NZME's digital media strategy is delivering revenue growth across all strategic pillars For personal use only Digital Audio Revenue Digital Publishing Revenue Digital OneRoof Revenue 4.0 60.0 8.0 3.5 7.0 50.0 3.0 6.0 Revenue ($m) Revenue ($m) 40.0 Revenue ($m) 2.5 5.0 2.0 30.0 4.0 1.
Slide 14: Advertising revenue had recovered to 2019 levels
2. CEO Overview Advertising Revenue had recovered to 2019 levels prior to Q3 2021 lockdowns For personal use only NZME Total Advertising Revenue Q1-Q3 2019-2021 [ Q1 2021 vs 2019 (-5.5%) ] [ Q2 2021 vs 2019 (-1.0%) ] [ Q3 2021 vs 2019 (-11.7%) ] 25 • Advertising revenue for H1 2021 was 3.2% lower th
Slide 15: Outlook Update
2. CEO Overview Outlook Update For personal use only • Despite the restricted operating environment, 4th Quarter revenues have been encouraging • Real Estate markets have shown signs of a positive recovery over recent weeks • Our audiences have been at record levels particularly on our digital platf
Slide 16: Performance Overview
For personal use only 3. Performance Overview David Mackrell Chief Financial Officer 16
Slide 17: Earnings stable despite Covid impacts
3. CFO Performance Overview Earnings stable despite Covid impacts For personal use only Revenue1 Performance 1 2 3 4 450 80 400 70 350 60 300 50 Revenue ($m) 250 40 $m 200 30 150 20 100 50 10 - - FY18 FY19 FY20 FY21F FY18 FY19 FY20 FY21F Publishing Audio OneRoof GrabOne Other EBITDA (IFRS 16) NPAT 1
Slide 18: Strong growth in Digital Advertising Revenue
3. CFO Performance Overview Strong growth in Digital Advertising Revenue Radio Advertising showing recovery from 2020 Covid impact while Print advertising has been flat For personal use only Advertising Revenue by Channel Advertising Revenue Channel Split 120 100% 90% 18% 19% 23% 26% 100 80% 70% Adv
Slide 19: FY21F Divisional Performance
3. CFO Performance Overview FY21F Divisional Performance For personal use only $m Audio Publishing OneRoof GrabOne Other Total Reader Revenue Print - 70 - - - 70 Digital - 12 - - - 12 Total Reader Revenue - 82 - - - 82 Forecast is based on midpoint of guidance Advertising Revenue range included in t
Slide 20: Permanent Cost Base reduction maintained
3. CFO Performance Overview Permanent Cost Base reduction maintained For personal use only Total Operating Expenses 400 • Permanent costs reductions implemented in 2020 maintained in 2021 350 • 2021 cost base higher due to increased activity 300 versus 2020 and lower temporary savings 250 Expenses (
Slide 21: Impact of GrabOne Sale
3. CFO Performance Overview Impact of GrabOne Sale For personal use only $m Gain on Sale Sale Price 17.5 Book Value of Assets (1.1) • GrabOne sale which was announced in August 2021 and completed on 29 October 2021 as Sale Costs (0.5) planned Gain on Sale 15.9 • The business and assets were sold for
Slide 22: Automotive remains an opportunity
3. CFO Performance Overview Automotive remains an opportunity DRIVEN has a similar number of dealer listings to Trademe, but with its private listings and larger audience, For personal use only Trademe has a strong market position. Dealer Listings Volume ('000)2 60 ~$30m ~$1m 119K 50 Trademe DRIVEN
Slide 23: Capital Expenditure expected to be $10-12m per year
3. CFO Performance Overview Capital Expenditure expected to be $10-12m per year For personal use only Capital Expenditure1 16 14 14 • Capital Expenditure in 2021 expected to be 12 ~$10m 12 10 10 • Recent interpretation of accounting standards in regard to costs relating to the Capex ($m) 8 implement
Slide 24: EBITDA margin growth targeted across each division
3. CFO Performance Overview EBITDA margin growth targeted across each division as part of FY23 Strategy For personal use only FY21F EBITDA1 FY23 EBITDA1 Margin Margin Target Audio 11% 15% – 17% Publishing 18% 19% – 20% OneRoof 2% 15% – 25% 24 NOTE: 1.EBITDA is a non-GAAP measure and is presented as
Slide 25: Net Debt fully repaid
3. CFO Performance Overview Net Debt fully repaid For personal use only Net Debt / (Cash)1 and Leverage Ratio 120 2.0 Leverage Ratio (Net Debt / 12 month Operating 100 1.8 1.8 • Net Debt of $100m fully repaid in the last 1.5 1.6 3 years 80 1.4 EBITDA (pre IFRS 16)) Net Debt / (Cash) ($m) 1.2 • GrabO
Slide 26: Dividend and Capital Return
3. CFO Performance Overview Dividend and Capital Return Dividend Policy For personal use only "NZME intends to pay dividends of 30-50% of Free Cash Flow subject to being within its target leverage ratio and having regard to NZME's capital requirements, operating performance and financial position."
Slide 27: Audio
For personal use only 3. Audio
Slide 28: Audio: Jason Winstanley
For personal use only 3. Audio Jason Winstanley Chief Radio Officer 28
Slide 29: Audio Scorecard
3. Audio New Zealand’s leading audio company Scorecard For personal use only FY 2020 Metric H1 2021 2023 Target Achievement NZME share of total > 1% share point growth 35.6%1 34.4%1 audience per annum > 1% share point growth Radio Revenue Share 40.4%2 40.9%2* per annum Digital audio revenue as a 2.4
Slide 30: Broadcast radio remains high with digital audio growing
3. Audio New Zealand’s leading audio company Background Broadcast radio globally remains high with Digital audio growing the total audio eco-system For personal use only Audio listening – US1 % listened to in the last month digital / week terrestrial • The audience for broadcast 100% radio remains t
Slide 31: Broadcast radio is the primary audio platform in NZ
3. Audio New Zealand’s leading audio company Background Broadcast radio is the primary audio platform in NZ Broadcast radio is consistent, reaching over 3.7 million New Zealander's each week1 and remains the primary For personal use only platform from 6am to 7pm weekdays, reaching over twice as many
Slide 32: Radio's share of advertising stable; podcasting a growth opportunity
3. Audio New Zealand’s leading audio company Background Globally radio’s share of advertising has remained relatively stable – podcasting is a growth opportunity For personal use only Radio Share of Advertising Revenue – Global1 • In the US, terrestrial radio revenue 7.0% 6.2% 5.9% remains the major
Slide 33: NZ radio market temporarily impacted by Covid-19
3. Audio New Zealand’s leading audio company Background NZ radio market temporarily impacted by Covid-19 For personal use only NZ Radio Advertising Market Revenue1 300 264 • New Zealand’s Radio Advertising market has been impacted 260 256 261 250 237 by Covid-19 220 200 • 2021 is forecast to be up 8
Slide 34: NZ Digital Radio Revenue continues to grow
3. Audio New Zealand’s leading audio company Background NZ Digital Radio Revenue continues to grow For personal use only NZ Digital Radio Market Revenue¹ 5 4 • iHeartRadio represents the 3 majority of New Zealand’s digital radio revenue as estimated and Revenue ($m) 2 reported by IAB • iHeartRadio a
Slide 35: New Zealand's leading audio company
For personal use only New Zealand’s leading audio company
Slide 36: Three pillars of the Audio Strategy
3. Audio New Zealand’s leading audio company Strategy New Zealand’s leading audio company There are three pillars to the Audio Strategy: For personal use only Create New Zealand’s Grow broadcast and Grow market revenue best local audio content digital reach share and digital revenue 36
Slide 37: Three pillars of the Audio Strategy
3. Audio New Zealand’s leading audio company Strategy New Zealand’s leading audio company There are three pillars to the Audio Strategy: For personal use only Create New Zealand’s Grow broadcast and Grow market revenue best local audio content digital reach share and digital revenue 37
Slide 38: NZME radio audience stable with strong growth in talk radio
3. Audio New Zealand’s leading audio company Strategy NZME radio audience is stable with strong growth in talk radio For personal use only NZME Radio weekly NZME Talk Radio – Major NZME Music Radio – Major listeners¹ Markets All 10+ Share² Markets 25-54 Share³ 2,100 15 Closure of 30 Content Radio Sp
Slide 39: Breakfast audience and iHeartRadio listening hours growth
3. Audio New Zealand’s leading audio company Strategy NZME Breakfast Audience and iHeartRadio Digital Listening Hours Growth For personal use only NZME 25-54 audience share has increased in the important Breakfast daypart1 NZME Radio – Major Markets iHeartRadio Monthly Total 25-54 Breakfast Share1 L
Slide 40: Content strategy has achieved positive audience shifts
3. Audio New Zealand’s leading audio company Strategy NZME's content strategy has achieved positive audience shifts to date For personal use only The content changes made in 2020 are focused on closing the gaps in the 25-54 demographic: • Strong growth for Newstalk ZB and ZM • Positive change to Coa
Slide 41: Focus on driving audience growth in 25-54 demographic
3. Audio New Zealand’s leading audio company Strategy Our focus remains on driving audience growth in the key 25- 54 demographic For personal use only 41 SOURCE: GfK, RAM, Commercial Radio, S3 2021, Total NZ, M-S 12mn-12mn, Cumulative Audience (000s), AP10+.
Slide 42: NZ's leading local content
3. Audio New Zealand’s leading audio company Strategy NZ's leading local content For personal use only • Brand portfolio covering all core demographics • iHeartRadio is NZ’s leading, advertising-funded single source audio application • Three dedicated digital native brands delivering content across
Slide 43: NZ's best multi-media broadcasters
3. Audio New Zealand’s leading audio company Strategy NZ’s best multi-media broadcasters For personal use only • Show hosts are at the heart of our audio business and NZME will continue to identify, attract and retain the best talent • Comprehensive market host study completed in August 2021 which h
Slide 44: Closing the gap further through to 2023
3. Audio New Zealand’s leading audio company Strategy Closing the gap further is the focus through to 2023 For personal use only Continued growth in 25-54 driven from improvements already seen at Breakfast 44 SOURCE: GfK, RAM, Commercial Radio, S3 2021, Total NZ, M-S 12mn-12mn, Cumulative Audience (
Slide 45: NZME is NZ's leading local podcaster
3. Audio New Zealand’s leading audio company Strategy NZME is NZ’s leading local podcaster For personal use only NZME Audio on Demand Content NZ Herald NZME’s podcast stable represents the best of NZME’s radio shows and NZ Herald's growing audio content supporting key editorial verticals, supporting
Slide 46: ACC - The Future of Sports Entertainment
3. Audio New Zealand’s leading audio company Strategy ACC - The Future of Sports Entertainment The Alternative Commentary Collective (ACC) is NZME’s multi-channel sports For personal use only entertainment brand encompassing digital audio channels, social channels, on-air integration with NZME terre
Slide 47: KICK - by youth, for youth
3. Audio New Zealand’s leading audio company Strategy Grow digital brand KICK - by youth, for youth Incubate new, youth focussed content formats and strategies using the new KICK brand, in turn For personal use only providing a feeder system of audience, content strategies and talent to NZME's wider
Slide 48: NZME is the leading podcaster in NZ
3. Audio New Zealand’s leading audio company Strategy NZME is the leading podcaster in NZ Podcast downloads continue to grow, up 43% year on year¹ For personal use only NZME Podcast Downloads¹ 2.5 New Zealand PodRanker September 2021² Rank Publisher Downloads 2.0 1 NZME/iHeartRadio 3,285,995 2 Audio
Slide 49: NZME's content matches what audiences want
3. Audio New Zealand’s leading audio company Strategy NZME’s content matches what audiences want In the US, iHeartRadio dominates audience and downloads through production of original shows and For personal use only radio catch-up. NZME has brands and content that aligns with what global audiences a
Slide 50: Digital is providing more access to audiences
3. Audio New Zealand’s leading audio company Strategy Digital is providing more access to audiences For personal use only It’s vital to meet consumers where they are now, and where they will be in the future. Increasingly, that means online, on mobile devices, at home, and at the time and place of t
Slide 51: iHeartRadio functionality
3. Audio New Zealand’s leading audio company Strategy iHeartRadio functionality provides NZME with market leading capability for audiences and advertisers For personal use only iHeartRadio Functionality NZ Live Radio ⚫ Custom Radio ⚫ Artist Radio (algorithm-driven music streaming) ⚫ Podcatcher (acce
Slide 52: Three pillars of the Audio Strategy
3. Audio New Zealand’s leading audio company Strategy New Zealand’s leading audio company There are three pillars to the Audio Strategy: For personal use only Create New Zealand’s Grow broadcast and Grow market revenue best local audio content digital reach share and digital revenue 52
Slide 53: Extend national reach through iHeartRadio and frequencies
3. Audio New Zealand’s leading audio company Strategy Extend national reach through iHeartRadio, strategic frequency acquisitions and investing in local content For personal use only • Across New Zealand NZME holds just over Owner % ownership of commercial FM 38% of all commercial FM frequencies. Go
Slide 54: iHeartRadio audiences at all time high
3. Audio New Zealand’s leading audio company Strategy iHeartRadio audiences are at all time high iHeartRadio’s reach has experienced significant audience growth and is also now the primary platform For personal use only NZME podcasts are consumed on Monthly Reach¹ NZME Podcasts by platform listened
Slide 55: Leverage platform reach of 3.4m New Zealanders
3. Audio New Zealand’s leading audio company Strategy Leverage NZME platform reach of 3.4m New Zealanders to grow audience For personal use only Build iHeartRadio’s digital reach by attracting new audience and encouraging active engagement 55
Slide 56: Uniquely positioned across all touch points
3. Audio New Zealand’s leading audio company Strategy NZME is uniquely positioned with brands and platforms across all touch points For personal use only 56
Slide 57: Three pillars of the Audio Strategy
3. Audio New Zealand’s leading audio company Strategy New Zealand’s leading audio company There are three pillars to the Audio Strategy: For personal use only Create New Zealand’s Grow broadcast and Grow market revenue best local audio content digital reach share and digital revenue 57
Slide 58: Continue to grow market share
3. Audio New Zealand’s leading audio company Strategy Continue to grow market share Commercial focus on key music brands and digital audio For personal use only • Increase overall market size by: • utilising industry wide research highlighting the power of radio • growing the market by accessing dig
Slide 59: Leading digital radio commercial opportunity
3. Audio New Zealand’s leading audio company Strategy The leading digital radio commercial opportunity in market Digital ad Insertion allows us to combine the benefits of Radio with the power of digital For personal use only NZME Digital Audio Revenue¹ 4.0 • Target specific audiences based on behavi
Slide 60: Case study: HP Business Class
3. Audio New Zealand’s leading audio company Strategy Case study: HP Business Class - The Story of New Zealand Business For personal use only The international award-winning podcast series from Newstalk ZB, presented by Heather du Plessis-Allan. Partnering with Hewlett Packard, and now in a second s
Slide 61: Audio Scorecard
3. Audio New Zealand’s leading audio company Scorecard For personal use only FY 2020 Metric H1 2021 2023 Target Achievement NZME share of total > 1% share point growth 35.6%1 34.4%1 audience per annum > 1% share point growth Radio Revenue Share 40.4%2 40.9%2* per annum Digital audio revenue as a 2.4
Slide 62: Publishing
62 For personal use only 5. Publishing
Slide 63: Publishing: Carolyn Luey
For personal use only 5. Publishing Carolyn Luey Chief Digital & 63 Publishing Officer
Slide 64: The NZ Herald is New Zealand's Herald
For personal use only The NZ Herald is New Zealand’s Herald
Slide 65: Publishing Scorecard
5. Publishing New Zealand’s Herald Scorecard For personal use only FY 2020 Metric H1 2021 2023 Target Achievement More than 210,000 Subscription 169,000 177,545 subscribers by 2023 year- Volume Target subscribers end Subscription 32% / 68% 38% / 62% Digital Only > Print Volume Mix % Households Subsc
Slide 66: Transition to a digital business focused on digital subscriptions
5. Publishing New Zealand’s Herald Background NZME’s Publishing business has transitioned to a digital business, focused on growing digital subscriptions For personal use only CURRENT Print Model Print Centric Model Digital Centric Hybrid Model Audience Audience Audience Local mastheads serving Loca
Slide 67: Three pillars of the Publishing Strategy
5. Publishing New Zealand’s Herald The NZ Herald is New Zealand’s Herald There are three pillars to the Publishing Strategy: For personal use only AUDIENCE SUBSCRIBERS ADVERTISING The #1 News brand for Subscriber first Be a safe, scalable all New Zealanders destination for advertisers SIMPLIFICATION
Slide 68: Three pillars of the Publishing Strategy
5. Publishing New Zealand’s Herald Strategy The NZ Herald is New Zealand’s Herald There are three pillars to the Publishing Strategy: For personal use only AUDIENCE SUBSCRIBERS ADVERTISING The #1 News brand for Subscriber first Be a safe, scalable all New Zealanders destination for advertisers SIMPL
Slide 69: Publishing: Shayne Currie
For personal use only 5. Publishing Shayne Currie 69 Managing Editor
Slide 70: National coverage and award-winning content
5. Publishing New Zealand’s Herald Background National coverage and award-winning content For personal use only New Zealand-wide reach Breadth of award-winning content NZ content and industry partnerships • Newsrooms and almost 300 • Integrated 24/7 news operation editorial staff in more than 20 acr
Slide 71: The #1 News brand for all New Zealanders
5. Publishing New Zealand’s Herald Strategy The #1 News brand for all New Zealanders For personal use only Audience expansion through Multi-platform storytelling to Quality is at the heart of New newsroom tools and a data-assisted, grow audience engagement, what we do through technology to support o
Slide 72: Audience expansion through new and diversified content
5. Publishing New Zealand’s Herald Strategy Audience expansion through new and diversified content For personal use only Kāhu is the NZ Herald and NZME's digital platform that showcases Māori stories and talent drawn from our newsrooms across Aotearoa A pivotal moment for NZME - a low-key, long-term
Slide 73: Revitalising our local connections
5. Publishing New Zealand’s Herald Strategy Revitalising our local connections For personal use only COMMUNITY TITLES • ‘Reporting Local, Supporting Local’ commitment across editorial and commercial • New centralised operating model – shaping for a digitally focused future • Alignment with NZ’s Hera
Slide 74: Building our future news audience - youth news brand
5. Publishing New Zealand’s Herald Strategy Building our future news audience - A new NZME youth news brand For personal use only Creating a proposition that is ‘made by rangatahi for rangatahi’ PREMIUM AUDIO PRINT Younger audiences are already engaging with our news brands – 381,000 15-24yos read n
Slide 75: Build audience engagement across multiple platforms
5. Publishing New Zealand’s Herald Strategy Build audience engagement by showcasing new projects and stories across multiple platforms For personal use only VIDEO AUDIO DATA The relaunch of NZ New, specialist podcasts – and Data journalism has been at Herald Focus - new a new morning news podcast th
Slide 76: Delivering bespoke journalism of personal interest
5. Publishing New Zealand’s Herald Strategy Delivering bespoke journalism of personal interest to individual readers For personal use only Q4 2021 • Personalised content embedded in prominent web positions - serving relevant, local content on site to build engagement • Premium newsletters curated by
Slide 77: Focusing on trust and engagement to fuel growth
5. Publishing New Zealand’s Herald Strategy It’s not about being the biggest - our editorial team is focusing on trust and engagement to fuel our growth For personal use only New Zealand’s most trusted publisher (as measured by NZ on Air and AUT) The newsroom KPIs: Audience engagement Trust Quality
Slide 78: Quality is at the heart of the newsroom
5. Publishing New Zealand’s Herald Strategy Quality is at the heart of the newsroom As well as the Covid ‘bump’, audience expansion has been driven by exclusive, quality journalism that For personal use only uncovers the truth, sets the news agenda – and celebrates the best of NZ • Education series
Slide 79: News channels drive the national conversation
5. Publishing New Zealand’s Herald Strategy NZME’s news channels drive the national conversation Highly influential, leading the national conversation to make New Zealand a better place - The 90% Project saw For personal use only us initiate a vaccine target and daily scorecard for New Zealand ‘Rema
Slide 80: Re-engineering the newsroom
5. Publishing New Zealand’s Herald Strategy Re-engineering the newsroom with an even stronger focus on distinctive, quality journalism For personal use only With the mix of data insights and journalistic instinct, we ask ourselves: Will this build audience and engagement and/or subscribers and engag
Slide 81: Newsroom tools and technology
5. Publishing New Zealand’s Herald Strategy Newsroom has access to more tools and technology to support journalism and audience engagement strategies For personal use only Delivered in 2021 2022 and Beyond • Registration and sign-up flow • Premium Subscriber Article Sharing • Premium Subscriber • Ne
Slide 82: Publishing: Matthew Wilson
For personal use only 5. Publishing Matthew Wilson 82 Chief Operations Officer
Slide 83: Three pillars of the Publishing Strategy
5. Publishing New Zealand’s Herald Strategy The NZ Herald is New Zealand’s Herald There are three pillars to the Publishing Strategy: For personal use only AUDIENCE SUBSCRIBERS ADVERTISING The #1 News brand for Subscriber first Be a safe, scalable all New Zealanders destination for advertisers SIMPL
Slide 84: Scorecard - 23 and beyond targets
5. Publishing New Zealand’s Herald Background Scorecard – 2023 and beyond targets For personal use only • Digital only subscriptions exceed print subscriptions in 2023 • More than 210,000 subscribers by the end of 2023 • Over 15% of NZ households subscribing to NZ Herald, in print or digital, by the
Slide 85: Focus on all subscribers
5. Publishing New Zealand’s Herald Strategy Focus on all subscribers For personal use only 1. 2. Maintain Print Digital Subscriber Subscribers Acceleration 85
Slide 86: Focus on all subscribers
5. Publishing New Zealand’s Herald Strategy Focus on all subscribers For personal use only 1. 2. Maintain Print Digital Subscriber Subscribers Acceleration 86
Slide 87: Print subscriber revenues remain stable
5. Publishing New Zealand’s Herald Print Subscribers Background Print subscriber revenues remain stable – supported by Premium activation For personal use only • Over 70% of eligible print subscribers have activated access to • Subscriber revenue stable (CAGR -0.7%) premium digital content • Subscri
Slide 88: Improved retention reflects Premium activation
5. Publishing New Zealand’s Herald Print Subscribers Background Improved retention reflects Premium activation increases For personal use only Active Annual Annual Subscribers Retention % Retention % 2021 2020 2021 < 1 Year 9,662 62% 63% 1-2 Years 8,181 71% 76% 2-3 Years 7,364 82% 82% 3-4 Years 7,05
Slide 89: Yield continues to offset small volume declines
5. Publishing New Zealand’s Herald Print Subscribers Background Yield continues to offset small volume declines For personal use only • Cover price increase of $0.20 per day implemented April 21 • NZ Herald is $3.70 on weekdays and $4.20 on weekends (incl. GST) • Individual subscriber pricing contin
Slide 90: Focus on all subscribers
5. Publishing New Zealand’s Herald Strategy Focus on all subscribers For personal use only 1. 2. Maintain Print Digital Subscriber Subscribers Acceleration 90
Slide 91: Digital subscriber growth rate continues at pace
5. Publishing New Zealand’s Herald Digital Subscribers Background Digital subscriber growth rate continues at pace For personal use only 20 Jul 2019 - 2021 Milestones Apple sign in launched 23 November 2nd Birthday Puzzles & Crosswords Sale Premium behind the paywall launch Black Friday campaign 27
Slide 92: NZ Herald Premium yield maintained as volume grows
5. Publishing New Zealand’s Herald Digital Subscribers Background NZ Herald Premium yield maintained as volume grows For personal use only • Growing coporate customer base, now representing 13% of activated subscribers • Reduction in yield from 2020 reflects this increased corporate customer base •
Slide 93: NZ Herald Premium versus international benchmarks
5. Publishing New Zealand’s Herald Digital Subscribers Background NZ Herald Premium is performing well versus international benchmarks For personal use only Subscriber Monthly Paywall Stop Monthly starts Monthly Measure Penetration ARPU Rate per million Churn Rate Rate UAs International 2% - 4% $10
Slide 94: Churn better than benchmarks
5. Publishing New Zealand’s Herald Digital Subscribers Background Churn better than benchmarks but still an opportunity for improvement For personal use only Subscriber Retention Year 1 NZME • Churn better than international benchmarks NZME • Opportunity to improve retention by improving the value p
Slide 95: Tracking in line with global publishers
5. Publishing New Zealand’s Herald Digital Subscribers Background NZ Herald Premium is tracking in line with Global publishers For personal use only The New York Times Digital Metrics1: ▪ Total digital subscribers 2.1% of USA population or 4.3% of average NZME 2025 monthly unique audience (164m) Tar
Slide 96: Paid news subscriptions continue to grow
5. Publishing New Zealand’s Herald Digital Subscribers Background Paid news subscriptions have continued to grow - on average readers have one paid news subscription For personal use only • Around the globe the proportion that pay for online news has continued to grow • On average subscribers tend o
Slide 97: Market opportunity in New Zealand is 1 million subscribers
5. Publishing New Zealand’s Herald Digital Subscribers Background The market opportunity in New Zealand is 1 million subscribers For personal use only • In 2001, 272 newspapers were sold per 1000 people in NZ – that was 1 million newspapers per day at that time • NZ’s print distribution was similar
Slide 98: Digital subscriber acceleration through three strategies
5. Publishing New Zealand’s Herald Digital Subscribers Strategy Digital subscriber acceleration through three strategies For personal use only Enhance Value Launch New Optimise Pricing Proposition Verticals and Packaging 98
Slide 99: Enhancing the value proposition with improved customer experience
5. Publishing New Zealand’s Herald Digital Subscribers Strategy Enhancing the value proposition with an improved end- to-end customer experience For personal use only • Improve end to-end touchpoints including onboarding, in life and exit experiences, focusing on moments that matter • Enhance Corpor
Slide 100: Enrich the Premium Subscriber experience
5. Publishing New Zealand’s Herald Digital Subscribers Strategy To enhance the value proposition, we will continue to enrich the Premium Subscriber experience For personal use only Read Free Anonymous Articles Read Free Get Prospect Articles Newsletters Personalization Read Free Get Read Registered
Slide 101: Broaden appeal and grow ARPU with key verticals
5. Publishing New Zealand’s Herald Digital Subscribers Strategy Broaden the appeal of the subscription proposition and grow ARPU by delivering key verticals For personal use only Herald Premium Business Lifestyle Food Puzzles Customer Need • I want a source of NZ • Single trusted source of • I’m loo
Slide 102: Deeper regional penetration is an opportunity
5. Publishing New Zealand’s Herald Digital Subscribers Strategy Our subscription footprint is now the whole of NZ - deeper regional penetration is an opportunity For personal use only Digital Subscriber Household Penetration Auckland Tactics to improve subscriber penetration: • Utilise NZME local sa
Slide 103: Implement strategic pricing model
5. Publishing New Zealand’s Herald Digital Subscribers Strategy Implement strategic pricing model to optimise long term value For personal use only New Product Adoption LifeCycle To date focus has been on early adopters. As we accelerate our growth into more casual readers, we are developing a strat
Slide 104: Publishing: Carolyn Luey
For personal use only 5. Publishing Carolyn Luey Chief Digital & 104 Publishing Officer
Slide 105: Three pillars of the Publishing Strategy
5. Publishing New Zealand’s Herald The NZ Herald is New Zealand’s Herald There are three pillars to the Publishing Strategy: For personal use only AUDIENCE SUBSCRIBERS ADVERTISING The #1 News brand for Subscriber first Be a safe, scalable all New Zealanders destination for advertisers SIMPLIFICATION
Slide 106: Digital market growth continues
5. Publishing New Zealand’s Herald Background Digital market growth continues For personal use only Newspaper and Digital Advertising Spend in NZ 2015-2020 1,800 Digital Revenue Digital Revenue2 Categories1 Share of Total NZ Advertising 1,600 Display - $163M Market Search – $833M 2015 31% 1,400 Soci
Slide 107: NZME revenue market share continues to grow
5. Publishing New Zealand’s Herald Background NZME revenue market share continues to grow For personal use only Total Print Advertising Market Revenue and Digital Display Advertising Market Revenue NZME Share % and NZME Share % NZME products driving growth3 300 48% 48% 250 27% 47% 26% 250 47% 47% 20
Slide 108: Brand safe and scalable destination for advertisers
5. Publishing New Zealand’s Herald Strategy Brand safe and scalable destination for advertisers For personal use only Leverage Best Technology Brand-Safe Audience Insights and Tools Monetisation 108
Slide 109: Build out customer data for richer audience insights
5. Publishing New Zealand’s Herald Strategy Build out customer data to create richer audience insights and sophisticated targeting solutions For personal use only 2021 Delivery 2022+ Priorities • Contextual targeting • Geo / demographic data segmentation • Sentiment targeting • Look a Like Modelling
Slide 110: Capabilities deliver effective campaigns at scale
5. Publishing New Zealand’s Herald Strategy NZME’s capabilities deliver effective campaigns at scale For personal use only Scale Audiences 1st Party Data Capability Customer Segments Artificial intelligence Business Property Natural Language Analytics Programming NZME ID Rural + = Sport Travel Machi
Slide 111: Portfolio of audience data products
5. Publishing New Zealand’s Herald Strategy NZME's portfolio of audience data products will provide a premium alternative to global platforms for all size of For personal use only advertisers Large Businesses Sophisticated pinpoint targeting Medium Businesses • Enrich client data to target Custom au
Slide 112: Self service proposition for the SME market
5. Publishing New Zealand’s Herald Strategy Self service proposition caters for the growing SME market and accelerated digital adoption For personal use only McKinsey & Co • Self service portal offering convenient 24/7 access to NZME digital products • Best in class digital client experience – self
Slide 113: Enhanced snackable video experience
5. Publishing New Zealand’s Herald Strategy Enhanced snackable video experience to take advantage of demand for brand safe video inventory For personal use only NZH Video Destination NZH App Video Experience • Easy content discovery and navigation • Optimised app video experience • Content recommend
Slide 114: Expansion of brand safe ad products
5. Publishing New Zealand’s Herald Strategy Expansion of brand safe ad products across all NZME environments For personal use only Native video creates a Enhanced native Shoppable content and richer experience and placements have recipes delivering NZH built recommendation engine serving native enga
Slide 115: Three pillars of the Publishing Strategy
5. Publishing New Zealand’s Herald Strategy The NZ Herald is New Zealand’s Herald There are three pillars to the Publishing Strategy: For personal use only AUDIENCE SUBSCRIBERS ADVERTISING The #1 News brand for Subscriber first Be a safe, scalable all New Zealanders destination for advertisers SIMPL
Slide 116: Simplifying the operating model
5. Publishing New Zealand’s Herald Strategy With the transition to a digital centric hybrid model, our business has got more complex - we will simplify to continue to For personal use only evolve Simplification Vision Review end to end operating model to enable investment that accelerates growth ini
Slide 117: Driving conversion and increasing lifetime value
5. Publishing New Zealand’s Herald Strategy Strategic focus on driving conversion and increasing lifetime value is critical to driving revenue mix For personal use only Goal Key Priorities • Broadest audience • Build NZH brand – owned, earned and paid reach and • High digital quality audience via so
Slide 118: Publishing Scorecard
5. Publishing New Zealand’s Herald Scorecard For personal use only FY 2020 Metric H1 2021 2023 Target Achievement More than 210,000 Subscription 169,000 177,545 subscribers by 2023 year- Volume Target subscribers end Subscription 32% / 68% 38% / 62% Digital Only > Print Volume Mix % Households Subsc
Slide 119: OneRoof
For personal use only 6. OneRoof
Slide 120: OneRoof: Paul Maher
For personal use only 6. OneRoof Paul Maher Chief of OneRoof 120
Slide 121: OneRoof Scorecard
6. OneRoof Your complete property destination Background Scorecard For personal use only FY 2020 Metric H1 2021 2023 Target Achievement Residential Listings 89%1 89%1 100% of listings #2, 460k, #2, 543k, gap Audience Reduce gap to #1 gap to #1 of 271k2 to #1 of 281k2 50% of Auckland residential list
Slide 122: Real Estate is a key market
6. OneRoof Your complete property destination Background Real Estate is a key market NZME’s largest revenue vertical For personal use only In New Zealand there are1: 701,000 871,000 INVESTORS FIRST HOME BUYERS 1,183,000 138,000 RENOVATORS MOVERS ~$150 million REAL ESTATE CLASSIFIEDS MARKET SIZE2 SOU
Slide 123: Market significantly impacted by Covid-19
6. OneRoof Your complete property destination Background Market significantly impacted by Covid-19 Significant demand, with limited inventory, resulting in lower advertising spend For personal use only National Residential Sales Volume1 14,000 • Significant demand saw national residential 12,000 sal
Slide 124: OneRoof has continued its strong audience growth
6. OneRoof Your complete property destination Background OneRoof has continued its strong audience growth OneRoof continues to grow brand equity and direct audience For personal use only Average YOY Audience Trends OneRoof vs Competitors Audience (000)1 growth (Jan-Aug) 1,000 +64% Monthly Unique Aud
Slide 125: OneRoof listings penetration continues to increase
6. OneRoof Your complete property destination Background OneRoof listings penetration continues to increase For personal use only Strong growth nationally OneRoof Listings vs realestate.co.nz (RE) and National Listing Penetration Vs RE and TM1 trademe.co.nz (TM) 120% (Note: TM includes Private at an
Slide 126: OneRoof revenue grows to pre-17 levels
6. OneRoof Your complete property destination Background OneRoof revenue grows to pre-17 levels – despite abnormal market impacts For personal use only Print revenue significantly impacted by COVID-19. Digital revenue growth is offsetting the reductions in Print revenue OneRoof Real Estate Revenue M
Slide 127: Revenue driven by diversified revenue streams
6. OneRoof Your complete property destination Background OneRoof.co.nz revenue is driven by diversified revenue streams For personal use only Strong growth of depth products – acceleration across rest of New Zealand remains an opportunity OneRoof.co.nz Revenue Mix Auckland Rest of NZ (digital only)
Slide 128: Brand Equity Growing Significantly
6. OneRoof Your complete property destination Background Brand Equity Growing Significantly1 Important to continue investing in building position For personal use only Year on Year Brand Movements (Aug 21 Vs Aug 20) OneRoof Prompted Awareness Unprompted Awareness +55% Preferred Real Estate Website +
Slide 129: OneRoof - Your Complete Property Destination
For personal use only OneRoof – Your Complete Property Destination
Slide 130: Three pillars of the OneRoof Strategy
6. OneRoof Your complete property destination Strategy Your complete property destination There are three pillars to the OneRoof Strategy: For personal use only Strengthen Core Be indispensable to Residential Listings Expand the Portfolio Agents Business 130
Slide 131: Three pillars of the OneRoof Strategy
6. OneRoof Your complete property destination Strategy Your complete property destination There are three pillars to the OneRoof Strategy: For personal use only Strengthen Core Be indispensable to Residential Listings Expand the Portfolio Agents Business 131
Slide 132: Strengthen Core Residential Listings Business
6. OneRoof Your complete property destination Strategy Strengthen Core Residential Listings Business For personal use only 1 2 3 Increase brand Leverage OneRoof Accelerate depth salience nationally strength across the product conversion real estate funnel 132
Slide 133: Increase brand salience nationally and locally
6. OneRoof Your complete property destination Strategy Increase Brand Salience Nationally and in Local Markets For personal use only Continue Building the OneRoof Brand • Targeting both Vendors and Agents • Grow organic audiences across digital channels Maintain investment in Brand Advertising • Lev
Slide 134: Only portal connecting consumers across the funnel
6. OneRoof Your complete property destination Strategy OneRoof is the only portal that connects with consumers across the Real estate funnel For personal use only Point of Differentiation OneRoof engages through the real estate cycle Content a key driver of differentiation for consumers and vendors
Slide 135: Target, engage and convert consumers through the funnel
6. OneRoof Your complete property destination Strategy Target, engage and convert consumers through the real estate funnel For personal use only Enhance capability to drive improved organic search Leverage data to increase Personalisation on site: Target consumers • Listing and content served based
Slide 136: Accelerate depth product conversion
6. OneRoof Your complete property destination Strategy Accelerate depth product conversion For personal use only Continue to deliver a suite of products that deliver market leading value to customers: • Across the real estate funnel (Passive – Active) • Across our multi-media platforms (Print / On-l
Slide 137: Three pillars of the OneRoof Strategy
6. OneRoof Your complete property destination Strategy Your complete property destination There are three pillars to the OneRoof Strategy: For personal use only Strengthen Core Be indispensable to Residential Listings Expand the Portfolio Agents Business 137
Slide 138: Be indispensable to Agents
6. OneRoof Your complete property destination Strategy Be indispensable to Agents For personal use only 1 2 3 Deliver data led and Leverage unique audience aligned strength of our content and Develop hyper-local products to build agent products agents brands and consumer engagement to build drive ap
Slide 139: Data led products to build agent brands
6. OneRoof Your complete property destination Strategy Deliver data led and audience aligned products to build agents brands and drive appraisals For personal use only First Party Data Proprietary Segmentation 12 Unique Audiences NOW Agent profile and testimonials delivered to highly targeted prospe
Slide 140: Leverage content and engagement to build agent brands
6. OneRoof Your complete property destination Strategy Leverage unique strength of our content and consumer engagement to build agent brands For personal use only NOW • Leverage sponsorship and integration across our platforms to deliver unique branding opportunities. • Agent interviews as a driver
Slide 141: Develop Hyper-local agent toolkit
6. OneRoof Your complete property destination Strategy Develop Hyper-local agent toolkit PONSONBY, AUCKLAND 1011 For personal use only Development of a data-hub for automated delivery of localised market facts, analysis and insights • Region and Suburb level data • Tailored for agency and / or agent
Slide 142: Three pillars of the OneRoof Strategy
6. OneRoof Your complete property destination Strategy Your complete property destination There are three pillars to the OneRoof Strategy: For personal use only Strengthen Core Be indispensable to Residential Listings Expand the Portfolio Agents Business 142
Slide 143: Expand the Portfolio
6. OneRoof Your complete property destination Strategy Expand the Portfolio For personal use only 1 2 Extend Listing Verticals Create pathway for - Retirement development of - New Build consumer services - Rural - Commercial 143
Slide 144: Extend Listings Verticals
6. OneRoof Your complete property destination Strategy Extend Listings Verticals For personal use only • Limited offerings currently in growing market Retirement • Increasing demand for retirement units (estimate of ~790K over 75 years by 20431) • Opportunity to create category • Growing vertical (i
Slide 145: Create Pathway for future consumer services
6. OneRoof Your complete property destination Strategy Create “Pathway” for future consumer services For personal use only Learning from International Portals • Significant investment in consumer services in Australia and US markets • Mortgages and Insurance prioritised • Revenue remains relatively
Slide 146: Summary of OneRoof Strategy
6. OneRoof Your complete property destination Strategy Summary of OneRoof Strategy For personal use only Strengthen Core Be indispensable to Expand the Portfolio Residential Listings Agents Business • Increase Brand Salience • Data & Ratings Led Appraisal • Extend Listing Verticals Products • Retire
Slide 147: OneRoof Scorecard
6. OneRoof Your complete property destination Scorecard For personal use only FY 2020 Metric H1 2021 2023 Target Achievement Residential Listings 89%1 89%1 100% of listings #2, 460k, #2, 543k, gap Audience Reduce gap to #1 gap to #1 of 271k2 to #1 of 281k2 50% of Auckland residential listings Listin
Slide 148: Summary
For personal use only 7. Summary Michael Boggs Chief Executive Officer 148
Slide 149: 2023 Strategic Priorities
7. CEO Summary 2023 Strategic Priorities For personal use only New Zealand’s New Zealand’s Your complete leading audio Herald property company destination Create New Zealand’s best The #1 News brand for Strengthen Core local audio content all New Zealanders Residential Listings Business Grow broadca
Slide 150: Strong Investment Case to Deliver Shareholder Value
7. CEO Summary Strong Investment Case to Deliver Shareholder Value For personal use only • A market leader in media and entertainment • A well-advanced digital transformation • Clear strategic goals with value adding outcomes • An experienced board and executive team • Strong cashflows and capital m
Slide 151: Disclaimer
DISCLAIMER 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, and you should not re
Slide 152: A leading integrated media company
For personal use only A leading integrated media company 152