Nexstar Media Group, Inc. · NASDAQ:NXST
Nexstar Media — Nexstar Broadcasting Group — Investor Presentation (May 2014)
26 slides from Nexstar Media's investor presentation, May 2014
Slide 1: Investor Presentation May 2014
NXST: NASDAQ Investor Presentation May 2014
Slide 2: Safe Harbor
Safe Harbor In addition to historical facts or statements of current conditions, this presentation contains forward-looking statements that involve risks and uncertainties within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements reflect the company’
Slide 3: Investment Summary
Investment Summary Rapidly Growing Mid-market Consolidator Recent highly accretive, strategic acquisitions Strong cash flow model and operating leverage based on diversified revenue streams and expense management discipline Leveraging Localism Building new high growth/high margin and recur
Slide 4: Nexstar Broadcasting Group: Leveraging Localism/Driving Diversification
Nexstar Broadcasting Group Leveraging Localism/Driving Diversification Diversified Top 20 TV Group with Leading Local Franchises Nexstar’s Operating Base Reaches ~16.0% of U.S. Television Households (pro-forma for all announced transactions) 108 Television Stations / 20 Multicast channels 56 M
Slide 5: Recent Key Operational Events
Recent Key Operational Events Record Financial Results Q1 2014 FY 2013 Actual Change Y/Y Actual Change Y/Y (in millions) (%) (in millions) (%) Net Revenue $133.8 +19.3% $502.3 +32.7% Broadcast Cash Flow $50.6 +27.2% $193.0 +12.9% Adjusted EBITDA $42.1 +27.4% $166.7 +13.9% Free Cash Flow $25.3 +148
Slide 6: Strong Industry Fundamentals
Strong Industry Fundamentals Broadcast Television Continues to be a Dominant Force in Consumers’ Media Lives TV Reaches More People than Any Other Medium TV is the Most Influential Local Media 96 of the Top 100 Rated Programs Most Influential of All Media Television 88% are Broadcast Programs (P18-4
Slide 7: Strong Secular Trends in Television Broadcasting
Strong Secular Trends in Television Broadcasting Driving Growth Near term Drivers: Political and Retransmission Consent Fees Double Digit Growth in Political Ad Spend Strong Retransmission Growth National Local ($ in Millions) $3,372 ($ in Billions) $4.9 $4.3 $2,493 $2,734 $571 $2,300 $3.6 $444 $1,7
Slide 8: Growth in Political and Issue Advertising
Growth in Political and Issue Advertising Strong Even Year Political and Issue Advertising Growth NXST FY Political Revenue – Even Year 2014 Key Senate and Gubernatorial Elections ($ in Millions) CAGR: 18.6% $50.0 $46.3 Record Number of Statewide Races in Nexstar Markets 2008-2012 $45.0 19 Senate Se
Slide 9: Retransmission Growth Cycle
Retransmission Growth Cycle Retransmission revenue is materially diversifying NXST’s total net revenue NXST Retransmission Revenue and Agreement Cycle (Twelve Months Ended December 31) $125.0 25.0% Retransmission Revenue 20.1% Retransmission Revenue as a % of Total Net Revenue $100.0 20.0% 16.1% $75
Slide 10: Consolidation is Reshaping the Industry Landscape
Consolidation is Reshaping the Industry Landscape Note: Pro forma all announced transactions. Source: BIA, Company Filings. Excludes: O&O groups, Hispanic, Religious, and ION. 10
Slide 11: NXST M&A Snapshot 2011 - 2014
NXST M&A Snapshot 2011 - 2014 58 Television Stations Acquired in Accretive Transactions for approximately $900 Million Closed Transactions Soon to Close Transactions Pending Transactions Liberty Media Corporation (2011) Hoak Media / Parker Broadcasting CCA/White Knight Broadcasting (2014) (Pending)
Slide 12: Accretive Acquisitions: Key Recent Events
Accretive Acquisitions: Key Recent Events From 2012 YE – 2014 Q1, NXST closed the accretive strategic acquisitions of 21 stations and 2 digital technology/services platforms for $472.1 million 2013 YE 2014 YTD Acquisition of 12 TV stations in 8 markets and Acquisition of 3 TV Stations in Iowa (Q
Slide 13: Accretive Acquisitions: Recently Approved / Pending Transactions
Accretive Acquisitions: Recently Approved Transactions / Pending Transactions FCC approved Nexstar’s purchase of 5 stations in 2 markets for $33.5 million, Nexstar has 3 transactions representing 28 stations pending before the FCC Soon-to-Close Transactions 2014 YTD Transactions Pending Approval F
Slide 14: Monetizing Targeted Localism
Monetizing Targeted Localism Strong Local Platforms Drive Value at Every Level NXST’s Expanding and Diversifying Revenue Mix Monetizing the local opportunity through 2009 Revenue Mix New 2013 Revenue Mix New five-tiered high margin revenue stream Media, Political, 2% Media, Other, 6% Political, 1%
Slide 15: Local/News Programming
Local/News Programming Local News Weather / Traffic Sports Campaign Coverage Local Lifestyle Programs Local Hometown Sports Community Involvement Special Reporting Award Winning News Mobile / Digital Social Media Engagement NXST’s local news rank among top 2 in 38 local news operations producing
Slide 16: Expanding Geographic Reach
Expanding Geographic Reach Local Community Focus ARKANSAS Pro forma: 108 Television Stations in 56 markets reaching ~16% of all U.S. TV HH TEXAS Little Rock-Pine Bluff, AR (56) Harlingen-Weslaco-Brownsville-McAllen, TX (86) KARK (NBC) (O&O) KVEO (NBC/Estrella) (O&O) KARZ (MNTV) (O&O) KLRT (FOX) (LSA
Slide 17: Network Affiliation Agreements
Network Affiliation Agreements Long-term record of negotiating mutually beneficial Network Affiliation agreements Affiliation Agreements: Pro forma for all announced transactions, together ABC/CBS/FOX affiliations represent approximately 70% of affiliation core ad revenue Long Term Affiliation Con
Slide 18: Nexstar Spectrum Assets
Nexstar Spectrum Assets Medium- to Long-Term Drivers / Opportunities: Spectrum Recent M&A activity has increased Nexstar’s and Mission’s spectrum assets given their expanded scale, creation of new duopolies, and entry into new markets License Type # of 6MHz Licenses MHz-pop Full Power (Big 4 Affil
Slide 19: Financial Overview
Nexstar BROADCASTING GROUP, INC. % Financial Overview
Slide 20: Growing Two Year FCF Cycle
Growing Two Year FCF Cycle (FY) Significant Free Cash Flow Growth Since IPO NXST Free Cash Flow based on two year cycles 300 * ~$265.0 250 * ~$200.0 200 ($ in millions) 150 $165.4 100 $114.7 $80.0 $54.3 50 $41.7 $15.1 0 2003/2004 2005/2006 2007/2008 2009/2010 2011/2012 2012/2013 Organic Growth, fuel
Slide 21: Historical Financial Summary
Historical Financial Historical Summary Financial (in millions) Summary (in millions) FY Net Revenue FY Core Revenues $600.0 $400.0 Local Revenue National Revenue $502.3 $348.8 $500.0 $350.0 $300.0 $266.3 $378.6 $249.8 $237.7 $400.0 $250.0 $235.9 $247.3 $313.4 $306.5 $212.5 $300.0 $266.8 $284.9 $252
Slide 22: 2013 FY Financial Summary
2013 FY Financial Summary (in thousands) Twelve Months Ended ($ in thousands) December 31, 2013 2012 Change Local Revenue $ 265,376 $ 190,168 +39.5% National Revenue $ 113,423 $ 76,123 +49.0% Local and National Core Revenue $ 378,799 $ 266,291 +42.3% Political Revenue $ 5,152 $ 46,276 (88.9)% Digita
Slide 23: Q1 Financial Summary
Q1 Financial Summary (in thousands) Three Months Ended ($ in thousands) March 31, 2014 2013 Change Local Revenues $ 65,642 $ 59,934 +9.5% National Revenues $ 27,189 $ 23,375 +16.3% Local and National Core Revenue $ 92,831 $ 83,309 +11.4% Political Revenues $ 4,003 $ 762 +425.3% Digital Media Revenue
Slide 24: Debt/Leverage Analysis
Debt/Leverage Analysis Nexstar Debt/Leverage Analysis TTM ENDED QTR ENDED (in millions) 12/31/2010 12/31/2011 12/31/2012 12/31/2013 3/31/2014 Revolver $ - $ 24.3 $ - $ - $ - TLB 99.5 148.1 288.3 545.4 541.9 8.875% Sr Sec 2nd Lien Notes 317.4 318.4 319.4 - - 6.875% Sr Sub Notes - - 250.0 525.7 525.7
Slide 25: Transformational Acquisitions and Operating Strategies Driving Record FCF
Transformational Acquisitions and Operating Strategies Driving Record FCF Closed Highly Accretive Acquisitions in 2013 and 2014 Newport #1 transaction adds $55 million of EBITDA in first full year of operations and is expected to result in a 45% increase in free cash flow per share Newport #2/
Slide 26: NXST: NASDAQ
NXST: NASDAQ Investor Presentation May 2014
Nexstar Broadcasting Group — Investor Presentation (May 2014) on 6ix