Sinclair, Inc. · NASDAQ:SBGI
Sinclair — Investor Day (October 2022)
128 slides from Sinclair's investor day presentation, Oct 3, 2022
Slide 1: Leading & Innovating Into the Future
LEADING & INNOVATING INTO THE FUTURE Connecting people with content everywhere OCTOBER 3, 2022 1
Slide 2: Agenda
AGENDA • Company Overview – Chris Ripley, President & CEO • Broadcast Overview – Rob Weisbord, COO & President of Broadcast • Distribution – Will Bell, SVP, Head of Distribution and Network Relations • News – Scott Livingston, SVP News • Other Businesses – Rob Weisbord, COO & President of Broadcast
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES This presentation contains certain financial measures, including Adjusted EBITDA and Adjusted Free Cash Flow, which are not prepared in accordance with U.S. generally accepted accounting principles ("GAAP") (collectively, the "non-GAAP financial measures"). Adjusted EBITD
Slide 4: Forward Looking Statement
FORWARD LOOKING STATEMENT The matters discussed in this presentation include forward-looking statements regarding, among other things, future operating results. When used in this presentation, the words "outlook," "intends to," "believes," "anticipates," "expects," "achieves," "estimates," and simil
Slide 5: Company Overview
COMPANY OVERVIEW Chris Ripley President & Chief Executive Officer 5
Slide 6: Investment Highlights
INVESTMENT HIGHLIGHTS Diversified assets encompassing news, Growth opportunities in marketing 1 sports, technology, and marketing 5 services, multi-platform content, services across multiple platforms community & interactivity, and data distribution, help fuel future growth Scale, audience reach and
Slide 7: Assets & Investments
ASSETS & INVESTMENTS Sinclair is comprised of broadcast stations producing award-winning news; national and regional sports networks; streaming platforms; multicast networks; marketing solutions; and innovative media technology. 7
Slide 8: History of Industry Innovation
HISTORY OF INDUSTRY INNOVATION Since its founding in 1986, Sinclair has been a pioneer at the forefront of innovation, establishing the company as a leader in industry expansion and technical expertise and vision First Local Marketing Agreement (LMA) First company to execute per-subscriber in 1991 -
Slide 9: Future Forward Strategy
FUTURE FORWARD STRATEGY Multi-Platform Content Marketing Services Repositioning the company out of legacy, growth-challenged markets into future- forward growth markets Four pillars drive efforts in becoming a top media organization 1. Multi-Platform Content Community & Interactivity 2. Marketing Se
Slide 10: Multi-Platform Content
MULTI-PLATFORM CONTENT Evolve to multi-platform content production centers Create compelling local news and sports content that can be utilized across the Company’s linear, digital footprint and big tech platforms ● Strong pipeline of new programming/brands to debut over the next 12 months Maximize
Slide 11: Marketing Services
MARKETING SERVICES Utilize a suite of proprietary and best-in- class tools to drive client business growth • Leverage strengths in technology and local markets to create differentiated, omni-channel solutions • Utilize regional/national scale to service larger accounts • Disrupt the industry by deve
Slide 12: Data Distribution
DATA DISTRIBUTION Become a wireless data distributor to fixed and mobile devices • ATSC 3.0/Next Generation TV enables a competitive infrastructure/platform integration for high demand applications • Leverage our US and international partnerships to drive validation and adoption of the technology •
Slide 13: Community & Interactivity
COMMUNITY & INTERACTIVITY Create a community hub where neighbors and fans can interact through content, games, and commerce • Enable real-time viewer engagement through personalized interactive offerings and gamification • Drive increased real-time viewership of local sports, news, and other unique
Slide 14: Sum of the Parts Value Exceeds Share Price
SUM OF THE PARTS VALUE SIG. EXCEEDS SHARE PRICE Broadcast segment & Other: Estimated market value of $35 per share ● Based on industry multiple of 7x on prior two years approximate avg EBITDA of $900M ● Includes Tennis, Compulse and NewsON, which are expected to grow meaningfully in the years ahead,
Slide 15: Broadcast Business
BROADCAST BUSINESS Rob Weisbord Chief Operating Officer & President of Broadcast 15
Slide 16: Broadcast Stations
BROADCAST 40 STATIONS Local focus, national reach 33 STATIONS 25 STATIONS One of the largest and most diversified television 22 STATIONS broadcasters with meaningful national 20 STATIONS reach and scale • Diversified 15 STATIONS geographically, by OTHER affiliate mix, and by 30 STATIONS asset type •
Slide 17: Diversified Advertising Revenue
DIVERSIFIED ADVERTISING REVENUE Timesales + Digital Excl. RSN's Timesales Revenue Excl. RSN's Timesales + Digital Excl. RSN's (TTM starting 6/30/22) [1] (TTM starting 6/30/22) [1] (Trailing 24 Months starting 6/30/22) [2] SBG Other** Digital Networks* Local Other** News Political Network Sports Netw
Slide 18: Revenue Growth Despite Adversity
REVENUE GROWTH DESPITE ADVERSITY Following COVID and the '21 Cyber Incident, advertising revenue has seen considerable growth with '21/'22 avg. revenue reaching an all-time high over the last 5 years Note: Excludes Diamond Sports Group, which was deconsolidated in 1Q 2022 1 Pro forma for all acquisi
Slide 19: Compounding Growth in Political & Digital
COMPOUNDING GROWTH IN POLITICAL & DIGITAL DRIVING OVERALL AD BUSINESS • Political 2-year cycle tied to timing of election years *dotted line represents high-end political guidance & % increase is a range between low and high end guidance • Comparing cycle to cycle, political revenues have grown mate
Slide 20: Sinclair Local Ad Total Addressable Market Is Large and Growing
SINCLAIR LOCAL AD TOTAL ADDRESSABLE MARKET (TAM) IS LARGE AND GROWING • Maximizing share of wallet, not just share of TV $'s, is a Sinclair core tenet • Through thoughtful specialization and strategic entry into growing markets, Sinclair is becoming a diversified media company, not just a major play
Slide 21: Maximizing Yield With Cross-Platform Sales
MAXIMIZING YIELD WITH CROSS-PLATFORM SALES ● We've created specialized sales teams and solutions, leveraging the breadth and depth of our existing assets to provide a "one-stop-shop" for advertisers and agencies ● These centralized teams allow us to unlock additional share of wallet with minimal inc
Slide 22: Increasing Share Through Specialization
INCREASING SHARE THROUGH SPECIALIZATION ● Emphasis on high performing areas in auto, legal, medical, and government that include owned and operated (O&O) sales that are focused on proprietary platforms designed to address the specific marketing needs of each category ● Sales teams of subject matter
Slide 23: Increasing Average Revenue Per User (ARPU)
INCREASING AVERAGE REVENUE PER USER (ARPU) Leveraging O&O digital assets as a funnel, we'll look to convert our 80M+ monthly unique digital users into customers, driving increased ARPU as a result 23
Slide 24: Distribution
DISTRIBUTION Will Bell SVP, Head of Distribution & Network Relations 24
Slide 25: Distribution: Power of Broadcast Remains Unmatched
DISTRIBUTION: POWER OF Broadcast Dominates Total Day P25-54 Avg. Audience (000), 2021-2022 Season, M-Sun BROADCAST REMAINS 600 Total Day UNMATCHED 400 200 “Broadcast Television is still the dominant way people watch… Broadcast Television is still primo, and it is not 0 going anywhere” … s D N TV S i
Slide 26: Distribution Revenue Broadcast Segment
DISTRIBUTION REVENUE BROADCAST SEGMENT Broadcast Distribution • Sustained Record of Growth: Revenue ($M) Broadcast Distribution Revenue has grown at an annualized rate of over 1,800 9% since 2017 9% R+ 1,600 CAG • Sinclair has maintained broadcast 1,475 1,414 distribution revenue growth despite 1,40
Slide 27: Broadcast Fees Still Undervalued Relative to Ratings
BROADCAST FEES STILL UNDER VALUED RELATIVE TO RATINGS RETRANS % OF TOTAL PROGRAMMING FEES • Broadcast fees have steadily increased their share of programming 25% costs and yet still fall well below the 39% of ratings* they 20% deliver, presenting significant organic growth opportunity as costs and 1
Slide 28: Forecast - Positive Retransmission Renewal Outlook
FORECAST - POSITIVE RETRANSMISSION RENEWAL OUTLOOK Percentage of Big 4 Subscribers • Sinclair expects to renew Under Expiring Agreements distribution agreements - 10% 20% 30% 40% 50% 60% representing over 90% of current Big 4 subscribers in 2023 and 2024, positively impacting 2024 Q4 2022 6% and 202
Slide 29: News
NEWS Scott Livingston SVP, News 29
Slide 30: Newsroom of the Future = Content Centers
NEWSROOM OF To truly transform our newsrooms, we must THE FUTURE = become more agile and produce targeted content on every CONTENT CENTERS platform in real time. 30
Slide 31: Multi-Platform Presence
MULTI-PLATFORM PRESENCE LINEAR Digital Evening AM News News 80+ Million Monthly Unique Users - #1 / #2 - #1 / #2 - 40 markets - 40 markets Late Social News 1.9 Billion Social Video Views - #1 / #2 180 Million Social Engagements - 43 markets #'s are TTM from 9/1/22 Source: Nielsen P25-54, May '22 Sou
Slide 32: Multi-Platform Content Creation
MULTI-PLATFORM CONTENT CREATION OTT Digital Linear Content Hub Social 32
Slide 33: Multi-Platform Content Creation
MULTI-PLATFORM CONTENT CREATION Transitioning purpose and process for modern journalism 33
Slide 34: News DNA
NEWS DNA • Focused Content • Stories of High Local Interest DISTINCTIVE • Journalists Dig Deeper • More Targeted Content DISCIPLINED Question Government Leaders Accountability Reporting Relentless Follow-Ups Voice of Voiceless DISRUPTIVE Follow the $$$ Impact 34
Slide 35: Reimagining News
REIMAGINING NEWS Our North Star: Create content that is relevant beyond the Boomer. • Adapted newscasts to be snackable and faster-paced; conversation and personality oriented o Experienced 20% year-to-year ComScore ratings increase in key demo • Expanded content creation on Digital & Social; YouTub
Slide 36: A Newscast of Discovery
A NEWSCAST OF DISCOVERY ● Providing clarity to emerging stories ● Built from the ground up, leveraging the resources and assets in the local markets ● 65 Markets, 28% of the Country ● Audience: 2 Million Per Week ● 3x the Avg. Impression Delivery of NewsNation (AM vs. AM)* ● Profitable after only 1
Slide 37: Audience Feedback
AUDIENCE FEEDBACK 85% of news consumers say they would keep watching. ● New ● Different ● Fresh ● High Quality ● Unbiased Approach ● Straight Forward News ● Smart News Source: Magid Adults 25-54 37
Slide 38: The National Weather Desk
THE NATIONAL WEATHER DESK • Leverage our 200+ Meteorologists, 100+ more than the Weather Channel, to create unique weather stories on all platforms: Instagram, Facebook, TikTok, Twitter, & digital and linear • Cool weather stories, viewer pictures, lifestyle, weather explainers 38
Slide 39: Award Winning Reporting With Impact
AWARD WINNING REPORTING WITH IMPACT Impactful Reporting with a Local Focus 2,000 Awards over the last 6 Years 75 National Awards 207 Edward R. Murrow Awards 502 EMMY Awards 39
Slide 40: Keeping Government Accountable
KEEPING GOVERNMENT ACCOUNTABLE ● KOMO News #1 in all News Dayparts ● Launch of Single Topic Initiative ○ Project Seattle ○ Operation Crime & Justice ● Single Topic Investigations in 25 markets ● Relentless focus on government accountability ● Documentaries ● Seattle is Dying ○ Fight for the Soul of
Slide 41: Giving a Voice to the Voiceless
GIVING A VOICE TO THE VOICELESS ● WRGB’s Anne McCloy was featured in The Atlantic after she advocated for Unemployed New Yorkers in her questioning of Governor Cuomo ● WGME Discovered a Nationwide problem ○ Veterans' crisis line connected to outdated websites ○ Emergency responders sent to wrong add
Slide 42: A Powerful Broadcast Business, Positioned for Continued Growth
A POWERFUL BROADCAST BUSINESS, POSITIONED FOR CONTINUED GROWTH ● Our portfolio is large and diversified ○ 185 stations, 86 markets, 4 O&O networks ○ No single affiliate delivers more than 30% of ad revenue ○ Non-Network programming contributes ~2/3 of ad sales revenue ● Political & digital growth, d
Slide 43: Other Business & Related Synergies
OTHER BUSINESS & RELATED SYNERGIES Rob Weisbord Chief Operating Officer & President of Broadcast 43
Slide 44: Tennis Channel Delivers Fans the Most Comprehensive Live Sports Ecosystem
TENNIS CHANNEL DELIVERS FANS THE MOST COMPREHENSIVE, INTEGRATED LIVE SPORTS ECOSYSTEM IN U.S. MEDIA Always one step ahead of the field, Tennis Channel harnesses the power of all popular platforms to maximize viewership and engagement to grow the brand and the game #1 TENNIS FREE 2ND NATIONAL LIVE MA
Slide 45: Tennis Channel – Always Leading the Way
TENNIS CHANNEL – ALWAYS LEADING THE WAY TO WINNING MASS-APPEAL DRIVING SPORTS MEDIA INNOVATION #1 Network in Live Sports Hours on US Television 300+ 93% #1 Online Global Tennis Website – (tennis.com) Days of live Of live tennis #1 Tennis Worldwide Magazine – (Tennis Magazine) tennis #1 Network among
Slide 46: Marketing Technology Platform
MARKETING TECHNOLOGY PLATFORM Sinclair provides innovative ways to serve its clients with tools, tech, and processes aligned around growth Compulse is a leading marketing technology platform and managed services company for local media companies and Tier 2 agencies. It makes omnichannel advertising
Slide 47: Leader in Local Sports Broadcasting
LEADER IN LOCAL SPORTS BROADCASTING Overview & Key Highlights ● Largest portfolio of regional sports networks (RSNs) in the U.S. ● Exclusive rights for local live broadcasts of approx. half of the MLB, NBA, and NHL teams ● Live sports viewers among the most desirable audience for advertisers & typic
Slide 48: Growth Networks Group
GROWTH NETWORKS GROUP Digital Broadcast TV – Driving the next generation of TV Networks Launched in 2016, the Growth Networks Group builds and operates new digital broadcast TV network brands and covers ~91% of the country’s Nielsen OTA Households* TV's home for the best in Sci-Fi. Featuring fan fav
Slide 49: NewsON: America's #1 Local OTT/CTV News Distributor
#1 RANKED LOCAL NEWS CHANNEL America’s #1 Local OTT/CTV News Distributor & 2 Billion ANNUAL AD Top 5 IMPRESSIONS MONETIZED ● “Best of the Best” of local TV news: RANKED NEWS THROUGH APP ON ROKU NewsON’s mission is to create national scale DIRECT AND around local TV news PROGRAMMATIC SALES ● All mark
Slide 50: Leading the Way for Local TV in CTV Partner Groups & Stations
LEADING THE WAY FOR LOCAL TV IN CTV PARTNER GROUPS & STATIONS • CBS News and • McKinnon Stations Broadcasting • Hearst Television • Fort Myers Broadcasting (WINK) • TEGNA • Morris Broadcasting 92% • Scripps • Block • Sinclair Broadcast Communications Group • Morgan Murphy • Cox Media Group Media • H
Slide 51: Corporate Responsibility
CORPORATE RESPONSIBILITY Lucy Rutishauser EVP & Chief Financial Officer 51
Slide 52: Focused on Corporate Social Responsibility
FOCUSED ON CORPORATE SOCIAL RESPONSIBILITY Environmental Social Governance Mission Mission Mission Identifying and implementing Providing a fair and inclusive Providing transparency, ways to reduce our environment and informing, accountability, and diverse organization’s impact on the engaging and s
Slide 53: Environmental – Doing Our Part for the Environment
ENVIRONMENTAL – DOING OUR PART FOR THE ENVIRONMENT Implementing Evaluating Efficient LED lighting, transmitters and Solar energy HVAC equipment Battery farms Battery recycling program Electric vehicles Eco-friendly office supply purchases Electricity usage Third party environmental certifications of
Slide 54: Social – Making a Difference in Our Communities
2021 Aggregate of individual business units On-air promotional time donated: SOCIAL – MAKING A $13,000,000+ Estimated DIFFERENCE IN OUR media value COMMUNITIES Funds raised for non-profit organizations, schools, $38,111,767 agencies, local disaster relief, charitable contributions 3,417,258 Pounds o
Slide 55: Social – Creating a Great Place to Work
SOCIAL – CREATING A GREAT PLACE TO WORK ● Industry leading benefits & compensation package ● Upward mobility ● Rewards & recognition ● Continuous learning & development ● Culture of innovation 55
Slide 56: Governance – Strengthening Transparency, Accountability and Diversity
GOVERNANCE – STRENGTHENING TRANSPARENCY, ACCOUNTABILITY AND DIVERSITY Since mid-2020: ● Hired first Chief Information Security Officer ● Hired first Chief Compliance Officer ● Formed ESG committee with Board representative ● Added Board committees ○ Regulatory committee ○ Nominating and Corporate Go
Slide 57: Corporate Social Responsibility
CORPORATE SOCIAL RESPONSIBILITY Setting goals, measuring and communicating progress and outcomes for the benefit of the environment, our communities, stakeholders and the bottom line. 57
Slide 58: Financial
FINANCIAL Lucy Rutishauser EVP & Chief Financial Officer 58
Slide 59: Financial Highlights
FINANCIAL HIGHLIGHTS • Growing key financial metrics • Converting over 70% of adjusted EBITDA into Adjusted Free Cash Flow • Reinvesting in future-focused growth initiatives • Returning shareholder value • Minimizing refinancing risk • Building significant liquidity • Delevering the balance sheet •
Slide 60: Growing Key Financial Metrics
GROWING KEY FINANCIAL METRICS Key Financial Metrics ($ in millions) 10 year CAGRs Media Revenue 17% Adj. EBITDA 13% Adj. Free Cash Flow 16% Adjusted Free Cash Flow Conversion 56% 54% 52% 55% 70% 76% Note: Excludes Diamond Sports Group, which was deconsolidated in 1Q 2022 60 As reported, 2-year avera
Slide 61: Driving Top Line Growth
DRIVING TOP LINE GROWTH Note: Excludes Diamond Sports Group, which was deconsolidated in 1Q 2022 61 As reported, 2-year averages. 2021 advertising revenue shown has been adjusted to add $63 million impact of cyber event.
Slide 62: Strong Demand From Political Advertisers Underpins TV's Relevance
STRONG DEMAND FROM POLITICAL ADVERTISERS UNDERPINS TV’S RELEVANCE Researcher s expecting record 2024 • Over 10% CAGR from 2014 to 2022 • 2022 expected to be a record midterm year and could approach 2020 level (pre-Georgia runoff) • Presidential election years tend to be higher than midterm years • Y
Slide 63: Investing in the Future
INVESTING IN THE FUTURE • Total adjusted Media expenses1 increased 4% on average over past 4 years o Normal Media expenses declined 1% on average o Growth initiatives added 5% • Approximately 13% of Total Media expenses1 was spent on initiatives from 2018 to 2022 Note: Excludes Diamond Sports Group,
Slide 64: Generating Significant Adj. Free Cash Flow
GENERATING SIGNIFICANT ADJ. FREE CASH FLOW Sinclair’s 2-year average Adjusted Free Cash Flow per share yield in excess of 40%1 Note: Excludes Diamond Sports Group, which was deconsolidated in 1Q 2022. Investments and Acquisitions in 2019 excludes Fox RSN acquisition. 1 Adj. Free Cash Flow per share
Slide 65: Returning Value to Shareholders
RETURNING VALUE TO SHAREHOLDERS Since the beginning of 2018, Sinclair has repurchased approximately 39M* shares or 38% of its shares outstanding. * YTD through August 3, 2022 65
Slide 66: Dividend – Yielding Meaningful Dividend Returns
DIVIDEND – YIELDING MEANINGFUL DIVIDEND RETURNS 5-Year CAGRs • Increased annualized per share dividend SBGI +19% rate by 39% since beginning of 2018 S&P 500 -3% • Increased dividend rate per share by 25% in 2022 • Per-share dividend 5-year CAGR 7% • 5% yield (as of 6/30/22) • Returning approximately
Slide 67: Delevering the Balance Sheet
DELEVERING THE BALANCE SHEET NET LEVERAGE LEGACY SBGI1 STGI2 Acquired Acquired Acquired Acquired Acquired Pre- 58 Invested Great 33 14 Tennis Bonten COVID-19 Cyber Recessio stations $1.4bn Recession stations stations Channel Media pandemic Incident n for in RSNs for $1.1bn for $1.2bn $0.4bn $0.2bn $
Slide 68: Consistently Strong Balance Sheet
CONSISTENTLY STRONG BALANCE SHEET SBGI Cap Table – June 30, 2022 ● More than $1 billion of liquidity ($ in millions) ● No refinancing risk for 4 years STG '27 Revolver (L+2%) - STG '26 Term B Loans (L+2.50%) 1,264 ● Undrawn revolver of $650M (2027 STG '28 Term B Loans (L+3%) 733 maturity1) STG ‘29 T
Slide 69: Sum of the Parts Value Exceeds Share Price
SUM OF THE PARTS VALUE SIG. EXCEEDS SHARE PRICE Broadcast segment & Other: Estimated market value of $35 per share ● Based on industry multiple of 7x on prior two years approximate avg EBITDA of $900M ● Includes Tennis, Compulse and NewsON, which are expected to grow meaningfully in the years ahead,
Slide 70: Financial Highlights
FINANCIAL HIGHLIGHTS • Growing key financial metrics • Converting over 70% of adjusted EBITDA into Adjusted Free Cash Flow • Reinvesting in future-focused growth initiatives • Returning shareholder value • Minimizing refinancing risk • Building significant liquidity • Delevering the balance sheet •
Slide 71: Investment Highlights
INVESTMENT HIGHLIGHTS Diversified assets encompassing news, Growth opportunities in marketing 1 sports, technology, and marketing 5 services, multi-platform content, services across multiple platforms community & interactivity, and data distribution, help fuel future growth Scale, audience reach and
Slide 72: Future of Sinclair
FUTURE OF SINCLAIR 72
Slide 73: Martin Kristiseter, SVP, Managing Director
Martin Kristiseter SVP, Managing Director 73
Slide 74: What We Do
WHAT WE DO Compulse provides an ad buying platform for local media, agencies, and brands. We offer omnichannel planning, execution, and reporting solutions. 74
Slide 75: Compulse by the Numbers
COMPULSE BY 70K+ 27K+ THE NUMBERS Campaigns [1] Advertisers [1] ● Best-in-class inventory at scale 200M 80M ● Access to advanced targeting and re- Active US Users [2] Unique Household targeting capabilities CTV Reach [3] ● Attractive pricing with no middle-man mark-up ● Aggressive managed service le
Slide 76: We're Targeting a Large TAM
WE'RE TARGETING A LARGE TAM US DIGITAL AD SPEND US CTV AD SPEND ● Total US digital ad spend is estimated to ● US programmatic ad spend Is growing reach $293B in 2024, nearly double 2020 rapidly spend of $152B ● CTV the fastest growing programmatic ● This year, US digital ad spend is expected to chan
Slide 77: The Pie Is Growing While Waste Runs Rampant
THE PIE IS GROWING WHILE WASTE RUNS RAMPANT % of Advertising Revenue Available Throughout the Funnel 120% 100% 100% 80% -25% 60% -15% -10% 40% -15% 30% -5% 20% 0% Total Ad Spend Agency Fee DSP Fee Technology Fee SSP Fee Technology Fee Publisher (Supply Side) Revenue Source: ISBA May 2020 Programmati
Slide 78: We Solve the Arbitrage Problem
WE SOLVE THE ARBITRAGE PROBLEM • Fair and equitable business model with lower gross margins • Vertical stack that eliminates multiple middlemen, providing efficiencies and cost savings to our customers • Self-serve and managed service options 78
Slide 79: We Buy the Whole Internet and More
WE BUY THE WHOLE INTERNET AND MORE 79
Slide 80: Compulse 360 Platform
COMPULSE 560 PLATFORM Planning aN ) —— Analyze * Forecast « Report * Plan * Propose * Enhance Execute —__~— * Manage * Execute * Optimize 80 ISTOMER DATA PLATFORM IMPLEMENTING TRANSFORMATION ATED SYNERGIES CORPORATE RESPONSIBILITY FINANCIAL COMPULSE MULT-PLATFORM CONTENT TENNISCHANNEL COMMUNITY & IN
Slide 81: Platform Overview
PLATFORM OVERVIEW Media Planner ● Custom media plans and proposals in minutes ● Automate pitches without sacrificing customization ● AI-driven cross channel media planning recommendations tied to outcome Demand Side Platform ● Purpose built DSP for high volume, local campaigns ● Self-serve and manag
Slide 82: We Power Some of the Largest Media Companies and Independent Agencies
WE POWER SOME OF THE LARGEST MEDIA COMPANIES AND INDEPENDENT AGENCIES 82
Slide 83: Investment Highlights
INVESTMENT HIGHLIGHTS • Leading technology platform for local media and agencies • Self-serve and managed service capabilities for omnichannel advertising • Fair and equitable business model • We are targeting a massive TAM that's only getting bigger 83
Slide 84: Multi-Platform Content
MULTI-PLATFORM CONTENT Scott Ehrlich Chief Innovation Officer 84
Slide 85: Capitalizing on Our Unique Original Content Opportunity: Archives
CAPITALIZING ON OUR UNIQUE ORIGINAL CONTENT OPPORTUNITY Combine storytelling and development expertise of top-tier talent with Sinclair’s breadth of local content creation and deep historical archives to produce compelling, impactful content in new formats and on additional distribution platforms. A
Slide 86: Capitalizing on Our Unique Original Content Opportunity: SBG Resources
CAPITALIZING ON OUR UNIQUE ORIGINAL CONTENT OPPORTUNITY SBG RESOURCES ● Capitalizing on more than 2,500 hours a week of news produced throughout Sinclair to power new formats that can run in local schedules ● New shared programming will free up local resources to build new audiences on digital platf
Slide 87: Capitalizing on Our Unique Original Content Opportunity: Syndicated Formats
CAPITALIZING ON OUR UNIQUE ORIGINAL CONTENT OPPORTUNITY SYNDICATED FORMATS ● Create and produce new game shows, talk shows, court shows, etc. ● New programming will replace diminishing supply from existing syndicators ● Game shows that have broad appeal could be sold to other station groups *Source:
Slide 88: Capitalizing on Our Unique Original Content Opportunity: Social
CAPITALIZING ON OUR UNIQUE ORIGINAL CONTENT OPPORTUNITY SOCIAL ● Scale internal and partner talent across new platforms to drive top-of-funnel interest for direct to consumer (DTC), gamification, newsletters, e-commerce and news content ● Our scale allows us to integrate television production resour
Slide 89: Growth Distribution in an Evolving TV Universe
GROWTH DISTRIBUTION IN AN EVOLVING TV UNIVERSE ● 13m new TVHH in '22 ● Passing 54.8m total TVHH ● Coverage in 50 of the top 50 and 94 of the top 100 DMAs* ● Key upgrades in Atlanta, Boston, and Tampa/St. Pete *refers to the entire "stack" as of 11/1/22 89
Slide 90: Across the Board Increases
ACROSS THE BOARD INCREASES Setting the stage for future growth and expansion ● Advertising revenue is projected to finish 2022 at $60m+, delivering a CAGR of ~23% since 2017* ● Key content investment in hit TV shows ○ '21: CSI: Miami, The X Files and Wipeout ○ '22: Buffy The Vampire Slayer and CSI N
Slide 91: Tennis Channel
TENNIS CHANNEL Poised for continuing Growth & Innovation ONE SPORT. ONE BRAND. WORLDWIDE. Ken Solomon President 91
Slide 92: Tennis Channel's Game-Changing Growth Plans
TENNIS CHANNEL’S GAME-CHANGING GROWTH PLANS Positioned for US and worldwide expansion by harnessing all new scaled distribution strategies and leveraging assets across all major media and commercial segments Primary Growth Initiatives • TC International Expansion - First Worldwide Single Sport Media
Slide 93: TC International Pays Dividends Now and in the Future
TC INTERNATIONAL Roll-Up Strategy: Gain rights to the WTA, ATP and Local/Regional Events in key markets. Partnerships with National Tennis Federations, Taking advantage of both FAST linear TV and SVOD Streaming Channels. PAYS DIVIDENDS NOW AND IN THE FUTURE Through both a Subscription Service and a
Slide 94: Tennis Channel Direct — 20 Year Distribution Breakthrough
Tennis Channel DTC TENNIS CHANNEL DIRECT Untapped Target Base —20 YEAR DISTRIBUTION BREAKTHROUGH 40% TC linear available to non-MVPD subscribers for the first time in 2024 60% (DTC POTENTIAL) (TC CURRENT) Cord-nevers/cord-cutters created an expanding need for DTC products to augment MVPD distributio
Slide 95: FAST Approach to National Scale
FAST APPROACH TO NATIONAL SCALE T2 is TC’s second 24/7 high-end daily coverage-driven linear service featuring LIVE matches not telecast on Tennis Channel. Free Ad Supported TV Network exclusive on all Potential future targets include LG, Vizio and Roku Samsung TV’s. All other FAST distribution avai
Slide 96: Leading US Sports Media in Gaming & Betting Based Content
TENNIS CHANNEL: LEADING US SPORTS MEDIA IN GAMING & BETTING BASED CONTENT CREATION & SPONSORSHIP Tennis is the #2 Most Bet Upon Sport Worldwide ● Immersive integrations with DraftKings and FanDuel, including ○ Global TC Live Desk sponsorships ○ Driving significant revenue and engagement ● Develop an
Slide 97: Lifestyle Sports Network Expansion
LIFESTYLE SPORTS NETWORK EXPANSION TC is preparing to launch a sister, dedicated linear and SVOD Pickleball Channel, leveraging TC’s tailor made infrastructure Tennis Channel has already produced and/or aired nearly 150 hours of PPA pickleball coverage in 2022 Tennis Channel produced Sketchers PPA I
Slide 98: Game-Changing Growth Plans
GAME-CHANGING GROWTH PLANS Positioned for global expansion. Harness new scaled distribution strategies while leveraging existing assets across all market segments Primary Growth Initiatives ● TC International Expansion - First Worldwide Single Sport Media Brand ○ Key Takeaway: TC All-Platforms Model
Slide 99: Tennis Channel
TENNIS CHANNEL Poised for continuing Growth & Innovation ONE SPORT. ONE BRAND. WORLDWIDE. 99
Slide 100: Community & Interactivity
COMMUNITY & INTERACTIVITY JR McCabe Chief Business Officer, Consumer Products 100
Slide 101: Driving Engagement and Interactivity
DRIVING ENGAGEMENT AND INTERACTIVITY ● Engage users, fans and viewers through game mechanics while gathering consented, first-party data ● Games business doubles every five years...doorway to non- gaming activities...70% of gamers are older than 18* ● Mobile, hyper-casual games continue to grow...ma
Slide 102: Creating Paths...Unregistered Visitor to Registered User
CREATING PATHS...UNREGISTERED VISITOR TO REGISTERED USER REGISTERED USER UNREGISTERED VISITOR 102
Slide 103: Playing Across Our Portfolio
PLAYING ACROSS OUR PORTFOLIO 103
Slide 104: Community and Loyalty
COMMUNITY AND LOYALTY ● Focused on building ongoing interaction with viewers, fans and digital visitors of physical communities ● Activating local viewers...in-program opportunities to "participate and play"...QR Code triggered experiences ● Reaching new communities too...Metaverse is projected to b
Slide 105: Revenue via Commerce
REVENUE VIA COMMERCE • Driving ARPU for the 80M+ monthly unique digital users we reach via engagement, retention and conversion and creating customers • 70%+ of our monthly users access us via mobile • 67% of e-commerce sales came from mobile in 2021* • Social commerce...for example, Snapchat users
Slide 106: Delivering Experiences That Engage, Retain and Generate Revenue
DELIVERING EXPERIENCES THAT ENGAGE, RETAIN AND GENERATE REVENUE ● Capitalizing on entertainment value of games ● Drawing like-minded individuals into engaging, interactive experiences ● Building strong, loyal fandoms and communities ● Incentivize and reward ● Generate ad revenue, commerce and ultima
Slide 107: Customer Data Platform
CUSTOMER DATA PLATFORM Kevin Cotlove EVP, Chief Digital Officer 107
Slide 108: Expanding and Leveraging First-Party Data
EXPANDING AND LEVERAGING FIRST-PARTY DATA • Leveraging our 80+ million monthly unique digital users • Customer Data Platform (CDP) is central repository of first-party data across Sinclair brands and digital assets • Enables enrichment of user profiles using data partners without reliance on third-
Slide 109: Sally Williams, News Viewer in Seattle
SALLY WILLIAMS, NEWS VIEWER IN SEATTLE Initial Interest in News Provides Email for Search, social, TV Receives Daily Goes to KOMO News Newsletter Subscription discovery Newsletter Site New Newsletter Targeted Email, SMS Subscriber Experience Personalized Content CSAT Survey Shows interest in news an
Slide 110: Robert Jones, Tennis Fan
ROBERT JONES, TENNIS FAN Initial Interest in Tennis Channel Creates Tennis Channel Targeted social Reads latest Downloads Accounts advertisements updates from Mobile app tennis.com Targeted Email, SMS New Member Experience Premium Streaming Personalized Content Subscription Following CSAT Survey fav
Slide 111: First-Party Data Marketing
WEBSITES APPS SOCIAL $ NEWSLETTERS COMMENTING DATA First-Party Growing FREE-TO-PLAY-GAMES Data Average Marketing Revenue Customer RETAIL E-COMMERCE Per User Loyalty EXPERIENCES NFTs Retention DAILY FANTASY REAL-MONEY BETS PREMIUM DTC $ $ $ SUBS
Slide 112: Implementing Transformation
IMPLEMENTING TRANSFORMATION Media & Technology Del Parks President, Technology Deployment of the NEXTGEN TV platform and our Cloud transformation priorities and goals focus on developing capabilities to create the FLEXIBILITY that will enable our business to grow and scale for present and future ope
Slide 113: NextGen TV
NEXTGEN TV
Slide 114: 57 NextGen TV Markets & Growing, 55% of U.S.
57 NEXTGEN TV MARKETS & GROWING 55% OF U.S. BitPath aggregates broadcast spectrum capacity to monetize data delivery in the U.S. 114
Slide 115: Current & Projected TV Availability
CURRENT & PROJECTED TV AVAILABILITY TV Shipments with NEXTGEN TV 27,563 15,750 7,875 4,500 3,000 195 2020 2021 2022 2023 2024 2025 Introduction Inflection Point Maturation % Unit Growth (YoY) 1438 50 75 100 75 % of Total TV 6 11 20 41 74 Pearl TV is a consortium of Source: CTA, U.S. Consumer Technol
Slide 116: Transition to NextGen TV Is Underway
TRANSITION TO NEXTGEN TV IS UNDERWAY Service will reach 75- 80% of US HH in 2023 126 121 120 115 125 106 106 95 89 80 63 63 43 Total TV Households 27 Households with NGTV 24 Signal 12 Households with NGTV 4 Receivers 0.3 2020 2021 2022 2023 2024 2025 2026 2027 TV HH Coverage of NGTV Receivers <1% 3%
Slide 117: Sinclair's NextGen TV Broadcast Application (BA)
SINCLAIR’S NEXTGEN TV BROADCAST APPLICATION (BA) Dynamic and Interactive on- screen overlay ● Sinclair has open-sourced our code so other broadcasters can adopt our base code ● Provides two-way communication with the viewer ● Configurable menu available for user defined, quick access to additional d
Slide 118: Sinclair NextGen Transformation Goals
SINCLAIR NEXTGEN TRANSFORMATION GOALS ● Provide a robust wireless IP data delivery pipe that reaches fixed & mobile receivers ● Improve viewer experience with better video, audio, targeted Ads & content ● Use our Broadcast Application (BA) to better serve our communities by providing targeted Advanc
Slide 119: International Reach
INTERNATIONAL REACH SINCLAIR SUPPORTS NEXTGEN TV ADOPTION & 5G INTEGRATION India has embraced “NextGen Broadcast” as part of a converged Broadcast/Broadband future! Completed Event Demos in India TIMING EVENT Mid ‘21 - Mid ‘22 Bengaluru 4 site Cellular Broadcast Mid ‘23 - Mid ‘24 Delhi - Direct-to-M
Slide 120: Seoul Mobile Datacasting & Targeted Ad Insertion Demo With KBS & Hyundai
SEOUL MOBILE DATACASTING & TARGETED AD INSERTION DEMO WITH KBS & HYUNDAI Film-type UHF ANT ATSC3.0 STB S8 Table attached to • Attached at the window of a • ATSC RF receiving (4xANT) Headrest (CAST.ERA App.) passenger seat • CAST.ERA M/W inside • 4xANT attached • WiFi capable • ATSC 3.0/OTA player th
Slide 121: Enhanced GPS Capabilities Using Data Delivery as a Service
ENHANCED GPS CAPABILITIES USING DATA DELIVERY AS A SERVICE (DDaaS) Corrected coordinates remained on the road while the uncorrected coordinates did not NavPathTM Commercialization of Enhanced GPS o Current GPS accuracy is +- 3 meters o Enhanced GPS fixed HD 850 DRONE precision under 10 cm o Low late
Slide 122: NextGen TV Datacasting Revenue Scenarios
NEXTGEN TV DATACASTING REVENUE SCENARIOS - UP TO $15B/YEAR IN 2030 $16,000 $15,000 High Case: $14,000 Average utilization of 7 $12,500 Mbps (27% of total spectrum capacity) $12,000 $10,700 $10,000 $10,000 $8,900 $ Millions Middle Case: $8,000 $7,500 Average utilization of 5 $7,000 $6,400 Mbps (20% o
Slide 123: Moving Sinclair to the Cloud
MOVING SINCLAIR TO THE CLOUD Started multi-year transformation program Enables strategic growth for existing business models Monetizes all our digital assets across new distribution platforms Implements new IP based business models Exploits NextGen’s flexibility to monetize our spectrum assets Dynam
Slide 124: Sinclair Is Leading the Broadcast Cloud Transformation
SINCLAIR IS LEADING THE BROADCAST CLOUD TRANSFORMATION Cloud operations today 2023 cloud forecast ● Playout 4 SBG networks 24x7 since Q3 ● Forecasting to add all TV broadcast 2020 stations by Q4 2024 ● Distribute these emerging networks on ● Building the Data Distribution as a an IP network to all a
Slide 125: Sinclair Unified Ad Sales Platform
SINCLAIR UNIFIED AD SALES PLATFORM AD INVENTORY ENHANCED BUY/SELL-SIDE CONVERGED SALES IMPROVE CAMPAIGN CONSOLIDATION CUSTOMER DATA INTEGRATION PERFORMANCE Monetize SBG’s Provides Data Streamlined ad “House of Improve advertisers augmentation buying process Brands” linear performance access to large
Slide 126: Sinclair Unified Ad Sales Roadmap
LEADING THE SALES TRANSFORMATION IN THE TV INDUSTRY SINCLAIR UNIFIED AD SALES ROADMAP UNIFY CONVERGE OPTIMIZE Begin Rollout 1Q-2023 to Linear Late 2023 / Early 2024 2024 – Beyond and Digital Sales Teams Incremental margin Converged sales to Advanced advertising improvement and monetize SBG’s product
Slide 127: Thank You
THANK YOU Connecting people with content everywhere OCTOBER 3, 2022 127
Slide 128: Investment Highlights
INVESTMENT HIGHLIGHTS Diversified assets encompassing news, Growth opportunities in marketing 1 sports, technology, and marketing 5 services, multi-platform content, services across multiple platforms community & interactivity, and data distribution, help fuel future growth Scale, audience reach and