E.w. Scripps Company (the) · NASDAQ:SSP
E.w. Scripps Company (the) — Scripps E W — UBS Media Conference 2014
42 slides from E.w. Scripps Company (the)'s conference presentation, Dec 10, 2014
Slide 1: The E.W. Scripps Co. UBS Media Conference
The E.W. Scripps Co. UBS Media Conference Dec. 10, 2014 Give light and the people will find their own way THE E.W. SCRIPPS COMPANY Filed by The E. W. Scripps Company Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed pursuant to Rule 14a-12 under the Securities Act of 1934 Subjec
Slide 2: Disclaimer
Disclaimer Additional Information and Where to Find It The proposed transactions involving Scripps and Journal will be submitted to the holders of Common Voting shares of Scripps and to the holders of Class A and Class B common stock of Journal for their consideration. In connection with the propose
Slide 3: Disclaimer, continued
Disclaimer, continued Continued from previous page … Participants in Solicitation Scripps, Journal and certain of their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in connection with the pro
Slide 4: New Scripps Post-Merger & Spinoff
4 New Scripps Post-Merger & Spinoff
Slide 5: New Scripps: Merger & Spinoff
Headquarters: Cincinnati Leadership: Rich Boehne remains as chairman, president and CEO Television stations: 34; U.S. household reach: 18%*; radio stations: 34 Digital: Strong local media brands plus Newsy and DecodeDC Headquarters: Milwaukee Leadership: Tim Stautberg, president and CEO;
Slide 6: New Scripps: Peer Landscape
Current FCC U.S. TV Household Cap of 39% 44% 39% 31% 24% 18.1% 17.8% 16% 13% 11% 10% 7% 6% 3% Tribune Sinclair Gannett Media General New SSP Hearst Nexstar Raycom Cox Meredith Gray Graham Holdings Quincy JRN 4% New Scripps: Peer Landscape Fifth-largest independent TV station owner. 34 stations in
Slide 7: New Scripps: Media Markets
Journal Television Markets Journal Radio Markets E.W. Scripps TV markets Indianapolis WRTV Baltimore WMAR Cleveland WEWS Cincinnati WCPO West Palm Beach WPTV Tampa WFTS Kansas City, MO KSHB KMCI IND Tulsa, OK KJRH Phoenix KNXV Buffalo WKBW Boise, ID* KIVI , KNIN Radio 4 FM Las Vegas KTNV Tucson KGUN
Slide 8: New Scripps: Financial Makeup
8 The segment profit distribution becomes more heavily reliant on television Two-year blended Newspapers: (18%) Television: (82%) New Scripps: Financial Makeup Television: (96%) Radio: (4%) Existing Scripps Scripps, post-merger
Slide 9: New Scripps: Radio
Think of radio… As a high-margin, cash-generating business As local, differentiated audio entertainment and information As local brands that belong to us (not networks and syndicators) As providers of news, talk and information programming that impacts our communities As amplifiers for TV
Slide 10: New Scripps Financial Overview
10 New Scripps Financial Overview
Slide 11: Post-deal, our financial priorities remain the same
11 Post-deal, our financial priorities remain the same Maintain sufficient liquidity and financial flexibility Strong track record of maintaining conservative leverage Conservative cash-on-cash investors Can resume share repurchases after deal while staying within leverage guidelines $60 m
Slide 12: Our uses of capital over the last two years
12 Our uses of capital over the last two years include aggressive repurchasing and acquisitions Share Repurchase Program: $100 million was authorized in November 2012 and another $100 million in May 2014 Program suspended until merger closes. $105 million remains Through Q2 2014, $95 million h
Slide 13: The Television Business
a SCRIPPS The Television Business
Slide 14: Local television news leads media consumption
14 Local television news leads media consumption Americans’ use of local TV and its associated digital properties lead all U.S. media for weekly delivery of local news. Source: American Press Institute, as reported on americanpressinstitute.org. Among U.S. adults age 18+, survey conducted in January
Slide 15: The Big 4 Networks aggregate eyeballs
15 The Television Business 1. The Big Bang Theory (CBS) 23.1 million 2. NCIS (CBS) 22.4 million 3. Sunday Night Football (NBC) 21.7 million 4. The Walking Dead (AMC) 18.3 million 5. NCIS: Los Angeles (CBS) 17.9 million 6. The Blacklist (NBC) 16.9 million 7. Person of Interest (CBS) 16.2 million 8. D
Slide 16: We continue to grow new markets
45% 8% 21% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 5-7 a.m. 6-6:30 p.m. 11-11:30 p.m. WKBW/Buffalo: % Rating Growth From July-October 2014 16 We continue to grow new markets Under Scripps ownership this year, WKBW/Buffalo has experienced significant audience growth starting in Q3. The company’s st
Slide 17: Political advertising continues to escalate
$0 $20 $40 $60 $80 $100 $120 2008: $41 million 2009: $5 million 2010: $48 million 2011: $7 million 2012: $107 million 2013: $4 million 2014: $58 million 17 Political advertising continues to escalate Television: Political Advertising
Slide 18: Television: Retrans Revenue
18 2012 $31 million 2013 $43 million Nearly 15 million cable households Television: Retrans Revenue 2014 ~$55 million 2015 ~$165 million* A slowdown in retrans revenue? Not for us *Annualized; assumes closing of Comcast-Time Warner merger, divestiture of Comcast subs to Charter, and Scripps-Journal
Slide 19: Television: Original Programming
Lower syndication expenses + more ad inventory = margin expansion Let’s Ask America is syndicated by MGM for nationwide distribution The List runs in 13 Scripps markets RightThisMinute now reaches 85% of U.S. households The Now launched this fall at 4 p.m. in eight Scripps markets 19 Television: Ori
Slide 20: Television: Acquisition Strategies
20 We remain acquisitive Market size 10–70 Independents that form duopolies Growing populations, good economies Political states Network diversity Ability to expand ratings Television: Acquisition Strategies
Slide 21: Television: Spectrum Value
21 First priority: Use it to serve communities Favor industry-created marketplace to monetize Will evaluate opportunities ahead of 2016 auction Scripps has a total of 84 MHz of spectrum Television: Spectrum Value The spectrum opportunity is evolving
Slide 22: New Business/Digital Strategy
22 New Business/ Digital Strategy
Slide 23: A History of Creating & Releasing Value
2008 2009 2010 2011 2012 2013 A History of Creating & Releasing Value Spun off Scripps Networks Interactive, creating what today is an $11 billion market cap company (HGTV, The Food Network etc.) Financial collapse rocked economy. Reset expenses; froze pensions; closed unprofitable operations; began
Slide 24: Emerging Businesses Strategy
24 1» Build products and services for organically growing audiences and revenue streams in our existing local markets. 2» Build and test new local models that are less dependent on advertising and more dependent on the value of data and loyalty. 3» Build and buy national brands that provide access t
Slide 25: Digital Investment
25 Our P&L expense falls into three categories 3» Brands with national reach Digital Investment 1» Local organic growth 2» New local- market models
Slide 26: Billions in digital dollars are available
26 TAMPA $600 SAN DIEGO $470 FORT MYERS $142 BALTIMORE $518 CINCINNATI $434 DENVER/FT. COLLINS $754 PHOENIX $714 INDIANAPOLIS $506 TULSA $190 KANSAS CITY $451 CLEVELAND $577 DETROIT $897 Borrell Local Digital Ad Revenue Opportunity 2015 (in Millions) Researched and Built Model by Market Billions in
Slide 27: Digital is a large and growing local marketplace
27 KMGH-Denver total audience, November 2014 1» Local Organic Growth Denver market annual ad dollars KMGH website visitors: 2.5 million KMGH news program viewers: 553,000 $754 million total local digital spend $295 million total local broadcast spend KMGH app users: 84,000 Source for KMGH viewers: T
Slide 28: We expect more than percent digital revenue growth
28 1» Local Organic Growth We expect more than 20 percent digital revenue growth over the coming years
Slide 29: Targeting the uniquely local opportunity: Cincinnati
29 Targeting the uniquely local opportunity: Cincinnati 2» New Local Market Models $100 million daily newspaper print ad spend $123 million local TV news program spend Local news consumption Local market ad dollars $434 million total digital spend $657 million total annual spend Sources: The Nielsen
Slide 30: Our investments include experimenting with new strategies
30 Our investments include experimenting with new strategies In-depth reporting well beyond traditional TV station Web news Subscriber model with unique meter strategy helping us define new markets Still in startup phase 2» New Local Market Models
Slide 31: New Local Market Models: WCPO Insider video
31 2» New Local Market Models Visit scripps.com’s Investor Information audio archives page to view a video about WCPO Insider that we showed during the presentation.
Slide 32: Our investment in WCPO Insider has helped us surpass the newspaper
32 2» New Local Market Models Our investment in WCPO Insider has helped us surpass the newspaper’s mobile products Unique visitors to Cincinnati media mobile and app products October 2014 Avg. Daily WCPO.com 731,000 23,581 Cincinnati.com 729,000 23,516 WLWT.com 712,000 22,968 Local12.com 251,000 8,0
Slide 33: Our growing portfolio of products complements our core businesses
Our growing portfolio of products complements our core businesses Newsy An over-the-top national video news provider DecodeDC Podcasts that help you better understand Washington 33 3» National/Local Brands Storm Shield A weather radio mobile app Weathersphere A top-ranked weather app technology comp
Slide 34: National/Local Brands: Newsy video
34 3» National/Local Brands Visit scripps.com’s Investor Information audio archives page to view a video about Newsy that we showed during the presentation.
Slide 35: National/Local Brands
35 3» National/Local Brands Mobile news audiences Local leverage OTT
Slide 36: New Business/Digital Strategy Goals
36 Goals: 1. Organically growing profitable cash flow streams 2. Developing new models less dependent on traditional advertising (more data/loyalty) 3. Limiting risk by focusing on audiences & marketplaces we know 4. Garnering attractive returns on investments through modest P&L investments and targ
Slide 37: Journal Media Group
a SCRIPPS Journal Media Group
Slide 38: Journal Media Group Highlights
Premier source of local news and leading consumer reach in its markets Digital strategies leveraged across portfolio Proven operating strategy focused on stabilizing revenue Focus on shared best practices to drive cost-efficiencies and operating margin opportunities Journal Media Group Highlights Hi
Slide 39: Journal Media Group Markets
Journal Newspaper Markets E.W. Scripps Newspaper Markets 14 newspaper markets with strong brands and extensive local reach Journal Media Group Markets 39
Slide 40: Journal Media Group Audience Reach
Journal Media Group Audience Reach 40 Unparalleled Consumer Reach in Local Markets Weekly readership on print and digital platforms 57% 63% 67% 73% 58% 61% 56% 66% 65% 65% 73% 63% 56% 69% 0% 20% 40% 60% 80% Percent a ge of a du lts r e a che d Newspaper Markets Source: 2013 Scarborough Report for Co
Slide 41: Journal Media Group Priorities
Journal Media Group Priorities 1. Create and deliver compelling products and services aimed at news and information consumers in our dynamic local markets 2. Efficiently connect advertisers with their current and prospective customers via our print and digital products and other services 3. Stabiliz
Slide 42: Questions
Questions Give light and the people will find their own way THE E.W. SCRIPPS COMPANY