Investor presentation. October 2008

Transcription

1 Investor presentation October 28

2 Polish ad market trends Ad spend growth by segment in 1H 28 In 1H8 ad market saw strong growth rate 4% 3% 2% 1% 17% 39% 18% 15% 14% 1% 8% Ad spend growth by segment in 28E (new estimates) No major signs of slowdown in dailies until summer % Total Internet Television Radio Outdoor Magazines Dailies Ad spend growth by segment in 2H 28E (new estimates) Total Internet Telev ision Radio Outdoor 12% 13-14% 11-12% 1% 35-4% Ad spend on dailies will decline in 2H 28 4% 3% 2% 1% % 9% 34% 11-12% 8% 6% 3% Total Internet Television Radio Outdoor Magazines Dailies Magazines 6-7% Dailies 1-2% % 1% 2% 3% 4% -1% -3-5% Source: 1H8 ad spend: estimates by: Agora (print, radio based on Expert Monitor and monitoring of Agora), Starlink (TV, Internet - display and verticals advertising, search engines), IGRZ (outdoor); 2H 28, 28 estimates: Agora 2

3 Polish ad market trends Dailies suffer due to slump in recruitment ads Change in number of recruitment ads in dailies 1% % Jan 8 Feb 8 Mar 8 Apr 8 May 8 Jun 8 Jul 8 Aug8 Sep8-1% -2% PLN CPP in TV and aggressive sales strategies of TV -3% -4% Advertising time in TV H8 Ad market structure TV and Internet continue to be the most accelerating segments thou. hours * Television 47% Radio 8% 28E Magazines 14% Outdoor 8% Internet (methodology change)** 1% Dailies 13% Source: recruitment ads: display ads, Agora s estimates (data in current prices); CPP in TV: Starlink estimates (24-1H 28), Agora estimates (2-23), data in current prices; advertising time in TV: AGB Polska; 28 ad market structure: Agora estimates * increased number of TV stations in monitoring ** incl. display and verticals advertising, search engines 3

4 Segment performance: Gazeta Copy sales of dailies Paid circulation of competition much below targets; Gazeta maintains healthy distance thou. copies 6 3 Launch of dual-pricing Everyday cover price up to PLN 1.1 Friday cover price up to PLN 2 Friday cover price up to PLN 1.5 Thursday and Friday cover price up to PLN 1.6 Everyday cover price up to PLN 1.8, Saturday PLN 2. Cover price up to PLN 3.4 (Oct 15, 8) New forms of distribution to rescue declining copy sales Cover prices are up but marketing spending remains high 1% 75% 5% 25% % 7% May6 Jun6 Jul6 Aug6 Other paid-for distribution methods % share in total paid distribution Sep6 Dziennik 1% 75% 5% 25% Oct6 Nov6 Dec6 Jan8 Feb8 Mar8 Apr8 May8 Jun8 Jul8 Aug8 1% 45% Jan8 Feb8 Mar8 Apr8 May8 Jun8 Jul8 Aug8 % Jan7 Feb7 Mar7 75% 5% 25% 8% % Apr7 May7 Jun7 Jul7 Fakt Gazeta Super Express Rzeczpospolita Dziennik 1% Gazeta 7% Aug7 Sep7 Rzeczpospolita parliamentary elections Oct7 Nov7 13% Jan8 Feb8 Mar8 Apr8 May8 Jun8 Jul8 Aug8 Dec7 Jan8 Feb8 Mar8 Apr8 May8 Jun8 Jul8 Aug8 Gazeta s dual-pricing 1H 7 1H 8 # of editions per week Total revenues from copy sales Total marketing cost 5,99zł mln 79 mln 61 mln 71 mln Source: copy sales: ZKDP; financials: consolidated financial statements according to IFRS, 2Q 8 4

5 Segment performance: Gazeta Gazeta s revenues Readership reach Gazeta remains market leader in terms of readership and newspaper advertising % 1.5% Gazeta Fakt Super Express Metro Dziennik No of readers 5.3 mln 5. mln 2.4 mln 2.2 mln 1.8 mln 6.1% 7.8% 7.2% 17.5% 16.5% 1H 27 1H 28 Rzeczpospolita 1.4 mln 4.8% % 1% % reach 2% Well-positioned to leverage existing strengths in the changing media landscape Newspaper ad market* Dziennik 7% 2pp Fakt 6% pp Advertising Other 1% 1pp 1H 28 Copy sales Polskapresse 14% 1pp yoy pp change Mecom (local) 6% 1pp Super Express 3% pp Rzeczpospolita 8% pp Metro 3% 1pp Dual media offer Non-standard ads Print (Gazeta, Metro) Cross-selling Internet Outdoor Gazeta 43% 1pp Source: financials: consolidated financial statements according to IFRS, 2Q 8; readership: Polskie Badania Czytelnictwa, execution MillwardBrown SMG/KRC, Jan-Aug 8, N=31 712, CCS indicator (weekly readership); dailies ad market: display ads, Agora s estimates * versus selected daily titles 5

6 Segment performance: Internet Revenue growth triples market rate Agora s online revenues excl. verticals* % mln hours 15 1 Total time spent 1 5 Nearly 8 online brands stand for growing reach 5 1H 27 1H 28 Jan7 Feb7 Mar7 Apr7 May7 Jun7 Jul7 Aug7 Sep7 Oct7 Nov7 Dec7 Jan8 Feb8 Mar8 Apr8 May8 Jun8 Jul8 Reach of Internet portals 8% 74.5% % reach On track to accomplish operating and market goals 67.6% 6% 52.3% 4% 63.9% 54.6% 49.1% 47.2% 46.3% Onet.pl Wirtualna Polska Interia.pl o2.pl Agora 3.% 27.3% 2% Oct4 Dec4 Feb5 Apr5 Jun5 Aug5 Oct5 Dec5 Feb6 Apr6 Jun6 Aug6 Oct6 Dec6 Feb7 Apr7 Jun7 Aug7 Oct7 Dec7 Feb8 Apr8 Jun8 Source: reach, time spent: Megapanel PBI/Gemius; financials: consolidated financial statements according to IFRS, 2Q 28 * advertising revenues of Agora s Internet offer do not include ad sales of verticals: GazetaPraca.pl, GazetaDom.pl and Komunikaty.pl and other sales such as: paid content (including mobile content) and e-commerce advertising 6

7 Segment performance: Internet Diversified portfolio of profiled services NEWS/ BUSINESS TRADER CLASSIFIEDS Classifieds are our core business ENTERTAINMENT AGORA UKRAINE Multinational partnerships and presence abroad MULTIMEDIA / AUDIOVISUAL content syndication MOBILE 7

8 Segment performance: Metro Financial performance Readership reach in Warsaw Rapid revenue and market share growth % Gazeta Metro Dziennik Fakt No of readers 555 thou. 465 thou. 263 thou. 246 thou. 2.3% 19.1% 36.% 43.% 28 operating goal achieved; further growth expected mln 1H 27 1H mln Revenues Operating EBITDA* Metro s share in the newspaper ad market Super Express Echo Miasta Rzeczpospolita 217 thou. 184 thou. 183 thou. 16.8% 14.2% 14.2% % reach % 5% 1% 15% 2% 25% 3% 35% 4% 45% New layout and editorial formula % share 4% 3.3% Expanded offer and enhanced layout to leverage revenue potential 2% 1.% 1.5% 1.7% 2.1% 2.6% 2.8% % 1H5 2H5 1H6 2H6 1H7 2H7 1H8 Source: financials: consolidated financial statements according to IFRS, 2Q 8; readership: Polskie Badania Czytelnictwa, execution MillwardBrown SMG/KRC, Jan- Aug 8, N=1 359, CCS indicator (weekly readership), Warsaw; dailies ad market: display ads, Agora s estimates (data in current prices) * excluding non-cash cost of share-based payments 8

9 Segment performance: collections Financial performance More diversified business new forms of content distribution mln 33 mln Revenues EBITDA mln -3 mln 1H 27 1H 28 Tough competition affects financial performance Business formula under review books series books CDs (distribution/ production) DVDs audiobooks 1H 8 8 series 22 one-offs movie coproduction Source: consolidated financial statements according to IFRS, 2Q 8 9

10 Segment performance: outdoor Financial performance Outdoor ad market Healthy financial and market figures % 11% Clear Channel 1% Other 15% 1H 28 AMS* * 28% Dynamic investment program in premium and superpremium panels 25 Capex 8% 1H 27 1H 28 Revenues Operating EBITDA* Advertising News Outdoor 11% Cityboard Media 15% New ad faces since January 26 Stroer 21% Grow portfolio through new formats of out-of-home panels mln 32 mln 35 mln 7.7 thou Universal: 2.7 thou Premium: 1.1 thou Superpremium:.7 thou Metro cars: CityINFO TV: Frames :.9 thou*** 2.3 thou H 28 June 28 content Source: financials: consolidated financial statements according to IFRS, 2Q 8; ad market: Expert Monitor, 1H 8 (rate card data); ad faces: AMS, excl ad panels on petrol stations, small panels at bus shelters and ad surfaces on buses and trams * excluding non-cash cost of share-based payments ** out of 28%, 6pp comes from Agora s media *** installed in September 28 1

11 Segment performance: magazines Financial performance Average copy sales (monthlies) Strong revenue and margin development 6 8% thou. copies % 3 14% 16% 4 Successful experiments in market niches 1H 27 1H 28 Revenues Operating EBITDA* Advertising 1H 27 1H 28 Open and prepared for various growth initiatives Monthly magazine ad market Media Point Group 4% Axel Springer 3% Edipresse 7% Bauer 15% Other 16% Gruner+Jahr 12% 1H 28 Murator 8% Ag o r a 13% Marquard 13% Burda Media Polska 1% Sales leader in men s magazine segment** Source: financials: consolidated financial statements according to IFRS, 2Q 8; copy sales: Agora; ad market: monitoring of Expert Monitor based on rate card data, 124 titles, excl. specialist titles, 1H 8 * excluding non-cash cost of share-based payments ** copy sales, ZKDP, Mar-Jun 28: "Logo" - 79 thou. copies; "CKM" 77 thou. copies, "Men's Health" 7 thou. copies, "Playboy" 61 thou. copies 11

12 Segment performance: radio Financial performance Audience reach Golden Hits Good financial results and audience ratings % % audience daily reach 14% 1.6% 11.4% 15 25% 7% 187% Growing audience share of TOK FM Local radio stations 1H 27 1H 28 Revenues Operating EBITDA* Advertising % 1H 27 1H 28 Audience share TOK FM Expansion online: Internet radio and video content % share 1% 5% yoy pp change 1 pp 4.4% 1.7 pp 7.2% % Cities of broadcasting Warsaw Source: financials: consolidated financial statements according to IFRS, 2Q8; Golden Hits audience reach: Radio Track, MillwardBrown SMG/KRC, cities of broadcasting, Jan-Jun (27: N=46 55, 28: N=45 97); TOK FM audience share: Radio Track, MillwardBrown SMG/KRC, Jan-Jun, Warsaw (27: N=3 17, 28: N=3 2), cities of broadcasting (27: N=16 214, 28: N=16 22) * excluding non-cash cost of share-based payments 12

13 Financial performance of the Group Increase of ad revenues in all segments 2Q 28 yoy % change 1H 28 yoy % change Revenues, incl.: 344 3% 657 3% - advertising - copy sales - collections % (1%) (68%) % 2% (59%) Operating costs, incl.: 314 7% 64 5% - raw materials, energy and 52 (19%) 112 (18%) consumables - staff costs 79 21% % - non-cash stock incentive comp % 24 19% - marketing and promotion 64 23% % - D&A 2 4% 4 4% EBIT 3 (25%) 53 (11%) Operating EBITDA* 62 (11%) 116 (1%) Net profit 22 (35%) 4 (15%) Collections lose revenues due to strong competition and market saturation Salary regulations Development of the Internet and outdoor offers 14% increase expected in full 28 Development of the Internet offer More dual pricing projects (cost offset by additional revenues from paid circulation) Employment e/y % % Source: consolidated financial statements according to IFRS, 2Q 8 * excluding non-cash cost of share-based payments 13

14 Summary: our objectives Continue to develop existing business areas; leverage multimedia advantage to enhance revenues and minimize possible decline due to ad market slowdown; More rigid cost control mechanisms across the company (including employment); careful not to limit growth areas; Continue to execute on strategic objectives; if possibile, take advantage of current equity market conditions to win valuable assets; 14

15 This presentation has been prepared by Agora SA (the "Company"). The data and information contained on the individual slides do not show a complete or coherent financial analysis, nor present the commercial offer of the Company and serve for information purposes only. A detailed description of the business and financial affairs of Agora SA is presented on website. All data therein are based on sources which the Company regards as credible. The Company reserves the right to amend data and information at any time, without prior notice. This presentation was not verified by an independent auditor. This presentation may contain slides containing statements related to the future. Such statements cannot be interpreted as forecasts or other assurances in respect of future Company's financial results. The expectations of the Company's management are based on their knowledge, experience and individual views and are dependent on many factors which may cause that the actual results may differ from statements contained in this document. The Company recommends that professional investment advice is sought in case any investment in the Company's securities is considered. 15