National Cinemedia, Inc. · NASDAQ:NCMI
National Cinemedia — Investor Presentation (August 2023)
30 slides from National Cinemedia's investor presentation, August 2023
Slide 1: Investor Presentation
HIGHLY CONFIDENTIAL SUBJECT TO ONGOING REVISION SUBJECT TO COMM ON INTEREST PRIVILEGE SUBJECT TO FRE 408 A ND STATE LAW EQUIVALENTS Investor Presentation August 2023
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation contains various forward-looking statements that reflect management’s current expectations or beliefs regarding future events and results of operations, including statements concerning the ultimate impact of the restructuring on the Company and National C
Slide 3: National CineMedia Leadership
NATIONAL CINEMEDIA LEADERSHIP THOMAS F. LESINSKI RONNIE NG SCOTT FELENSTEIN CEO CFO PRESIDENT, SALES, MARKETING, & CEO since August 2019 and Board Director since CFO since September 2021. Former CFO and PARTNERSHIPS 2014. Formerly CEO and Board Director at Sonar Head of Corporate Development, Allen
Slide 4: New Board of Directors Focused on Growth
NEW BOARD OF DIRECTORS FOCUSED ON GROWTH Ms. Zalaznick is a widely recognized business leader with more than 30 years’ experience creating and implementing growth strategies for leading media companies and digital startups. LAUREN ZALAZNICK Ms. Zalaznick is a Senior Advisor to The Boston Consulting
Slide 5: Leading Cinema Advertising Platform Positioned for Growth
LEADING CINEMA ADVERTISING PLATFORM POSITIONED FOR GROWTH • NCM captures over 70% market share across top 10 DMAs(1) PREMIERE MARKET LEADER • Over 18,000 screens across 1,400+ theaters • Cinema is #1 for attention and continues to attract young and diverse audience BEST-IN-CLASS ADVERTISING • Strong
Slide 6: Premiere Market Leader
PREMIERE MARKET LEADER NCM operates the largest national cinema advertising network in North America delivering video and digital marketing to national and local clients On-screen Advertising Lobby Advertising Digital Online Digital Out-of-Home Branded entertainment and Video screens and theater “Au
Slide 7: Unmatched Market Share
UNMATCHED MARKET SHARE NCM is the largest cinema advertising platform in the U.S. • No other cinema advertising platform can offer advertisers the scale and reach of NCM’s national advertising platform • Local and regional advertisers rely on NCM’s strong market share in individual Designated Market
Slide 8: NCM's Strong Audience Delivery and Market Share
NCM’S STRONG AUDIENCE DELIVERY AND MARKET SHARE NCM attendance returning strong post-pandemic # of Available Impressions per Movie NCM’s Top 10 DMA Market Share (Millions) (% of Total Screens) 10.5 72% 9.6 70% 68% 67% 66% 8.7 63% 64% 8.0 8.1 6.8 4.6 (1) 2017 2018 2019 2020 2021 2022 6/2023 2017 2018
Slide 9: On-screen Advertising
ON-SCREEN ADVERTISTING Innovative On-screen Advertising The Noovie® branded entertainment show provides a best-in-class advertising platform for marketers and entertaining show for movie patrons •~30 minute program of content & advertising that plays prior to movie start Noovie •Popular content incl
Slide 10: Best-in-Class Advertising Inventory
BEST-IN-CLASS ADVERTISTING INVENTORY Noovie® on the big screen is unique in format and content THE NOOVIE SHOW TRAILER PACK & EDITORIAL CONTENT, BRANDED CONTENT & ADS PLATINUM POSITION Platinum: 60- or 30-second Noovie Programming Primarily Long-form Primarily Local and National Ads, PSA, advertisin
Slide 11: Noovie & Platinum Deliver Maximum Engagement
NOOVIE® & PLATINUM DELIVER MAXIMUM ENGAGEMENT Both segments have consistently proven effective across categories, as evidenced below Noovie Platinum 72% 85% 78% Ad Recall Ad Recall Ad Held My Attention +64% +24% +136% +179% Brand Awareness Consideration(1) Brand Awareness Message Association (1) As
Slide 12: Cinema Is #1 for Attention
CINEMA CINEMAISIS#1#1 FOR FOR ATTENTION ATTENTION AVERAGE VIEWING TIME BY PLATFORM (SECONDS) for a :30 ad CINEMA LINEAR LIVE CTV NON- SKIPPABLE INSTREAM FEED FEED FEED INSTREA FEED STORY :30S TV :30S SPORTS :30S SKIPPABLE MOBILE PRE-ROLL MOBILE DISPLAY VIDEO M VIDEO MOBILE MOBILE NORMS MOBILE VIDEO
Slide 13: Reaches Young & Diverse 'Unreachables'
REACHES YOUNG & DIVERSE 'UNREACHABLES' MEDIAN AGE 30 2.5X MORE WATCH ADS AT THE MOVIES OLDER GENZ & YOUNGER MILLENNIALS VS. LINEAR TV & CTV GEN Z/ MILLENNIALS 75% 3X SPEND RATE VS GENERAL POPULATION 45% GEN Z | 33% MILLENIALS | 14% GEN X 6% BOOMERS | 2% SILENT GEN MULTICULTURAL (WEEKLY AVG) 28% HISP
Slide 14: NCM Has Better Reach Than Sports
NCM HAS BETTER REACH THAN SPORTS NCM reaches more audiences which are younger compared to major sports Nielsen Media Impact, NBA = June 2022, SNF = Dec 2022, NCAA Basketball 2022, NCAA Football Jan 2022 14
Slide 15: Unparalleled Audience Numbers
WORLD'S CINEMA CINEMAISIS BEST #1#1 FOR CONTENT FOR ATTENTION ATTENTION DELIVERS UNPARALLELED AUDIENCE NUMBERS 2023 OFF THE CHARTS GROWTH TOP FIVE FILMS TO-DATE (1) $6B BOX OFFICE YTD January 1-August 7 $=MILLIONS +19% YOY BOX OFFICE GROWTH January 1-August 7 $1B GLOBAL BOX OFFICE Barbie, The Super
Slide 16: Valuable Data Capabilities
VALUABLE DATA CAPABILITIES NCM’s advanced relationship with consumers creates new data-centric opportunities for brands NCM’s data and technology platform, NCMx TM, enhances the ability of marketers to measure the value of their advertising spend, enhancing the value of cinema advertising inventory
Slide 17: NCMx: Advanced Measurement Capabilities
NCMxTM: ADVANCED MEASUREMENT CAPABILITIES Exclusive data extends reach to target audiences across screens Our theater audience, expertise and robust theater audience data will enhance our ability to compete with other larger digital advertising platforms for marketing dollars Exclusive Data Sources
Slide 18: Continued Growth of Audience Data
CONTINUED GROWTH OF AUDIENCE DATA With new partners on board, tracking moviegoer data is growing at our fastest rate in the past four years Number of Cumulative Moviegoer Theatre Visits (In Millions) CAGR = 78% 515M 374M 273M 201M 125M 29M YE 2018 YE 2019 YE 2020 YE 2021 YE 2022 Now 18
Slide 19: Innovate for the Future
INNOVATE FOR THE FUTURE Ad Spending moving toward Programmatic Marketplaces NCM readying historic launch of on-screen programmatic for the first time in cinema’s history Programmatic Spending ($ billions) 16% % = YOY Growth 17% $74.5 52% $64.2 $54.9 38% 42% $36.1 38% 125% $26.2 $18.4 $13.3 $5.9 2016
Slide 20: Historical Revenue Composition
FINANCIAL HIGHLIGHTS Historical Revenue Composition Major 20% Markets National 70% 3% Digital 7% Beverage 20
Slide 21: Financial Highlights
FINANCIAL HIGHLIGHTS Total NCM attendance Revenues returning strong post-pandemic Adjusted OIBDA(1) ($ Millions) ($ Millions) 426 441 444 205 205 208 249 246 57 51 115 90 (19) (25) 2017 2018 2019 2020 2021 2022 LTM 6/2023 2017 2018 2019 2020 2021 2022 LTM 6/2023 Capital Expenditure(2) Unlevered Free
Slide 22: Total Revenue per Attendee
FINANCIAL HIGHLIGHTS NCM attendancemonetization Audience returning strong returning post-pandemic to historical levels Total Revenue per Attendee ($ Actual) 0.68 0.64 0.65 0.65 0.65 0.63 0.63 0.59 0.46 2015 2016 2017 2018 2019 2020 2021 2022 LTM 6/2023 22
Slide 23: Domestic Box Office Trends
DOMESTIC BOX OFFICE TRENDS Domestic Box office shows resilience through downturns Domestic Box Office and NCM Attendance Recession Recession COVID-19 $14.0 800 699 695 705 690 688 689 667 656 700 $12.0 651 637 637 (1) 619 Domestic Box Office (in Billions) 577 NCM Attendance (in Millions) 600 $10.0 5
Slide 24: NCMI's Organizational Structure Simplified Post Emergence
NCMI’S ORGANIZATIONAL STRUCTURE SIMPLIFIED POST EMERGENCE ▪ The agreement with the secured lenders allowed NCMI legacy shareholders to maintain 13.8% of the emerged equity of NCM LLC ▪ In addition, Regal also terminated its 23.4% interest in NCM Inc. ▪ Secured lenders elected to receive their 86.2%
Slide 25: NCMI Post Emergence
NCMI POST EMERGENCE Post stock split and post emergence, NCMI has 96.8 million shares outstanding Based on the pre-split shares outstanding on 8/3/2023, the adjusting items for post emergence include the following: (i) the termination of 40.7M pre-split shares held by Regal (ii) the 1-for-10 reverse
Slide 26: Cost Savings from Rejected Contracts
COST SAVINGS FROM REJECTED CONTRACTS As part of the financial reorganization process, NCM LLC terminated contracts which resulted in ~$8.3M of annualized cost savings These cost savings were not factored/reflected in the financial projections of the cleansing materials as provided on 4/11/2023 Assum
Slide 27: Unlevered Balance Sheet
UNLEVERED BALANCE SHEET Post emergence, NCM LLC has an unlevered balance sheet with only a new $55 million ABL revolving facility At the time of emergence, the Company drew the minimum required $10 million from the new facility ▪ Three-year tenor with a maturity date of 8/7/2026 ▪ Interest rate of (
Slide 28: Q&A
HIGHLY CONFIDENTIAL SUBJECT TO ONGOING REVISION SUBJECT TO COMM ON INTEREST PRIVILEGE SUBJECT TO FRE 408 A ND STATE LAW EQUIVALENTS Q&A 28
Slide 29: Appendix
HIGHLY CONFIDENTIAL SUBJECT TO ONGOING REVISION SUBJECT TO COMM ON INTEREST PRIVILEGE SUBJECT TO FRE 408 A ND STATE LAW EQUIVALENTS APPENDIX 29
Slide 30: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS Operating Income to Adjusted OIBDA (dollars in millions) (unaudited) FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 LTM 6/2023 (9) Operating income (loss) $ 148.0 $ 173.0 $ 153.9 $ 154.3 $ 161.3 $ (61.0) $ (68.6) $ 6.9 $ (9.0) Depreciation expense 9.6 8.7 11
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