Nine Entertainment Co. Holdings Limited · ASX:NEC
Nine Entertainment — H1 FY2023 Earnings Presentation
32 slides from Nine Entertainment's earnings presentation, Feb 23, 2023
Slide 1: FY23 Interim Results
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Slide 2: Mike Sneesby, Chief Executive Officer
MIKE SNEESBY CHIEF EXECUTIVE OFFICER 2
Slide 3: Operational Highlights
OPE R ATI ON AL HIGHLIGHT S MARKET LEADING CONTENT #1 AD REVENUE SHARE… S TRONG SUMMER FOR S TAN Nine’s content has led the Across Total Television with share Performance of Stan’s market- across all platforms – growth in Radio and Publishing content, mainly Stan Originals, Broadcasting, Streaming a
Slide 4: Group EBITDA in line with guidance
GROUP E BI TDA I N L I N E W I TH G UI DAN C E EBITDA, A$M 4 Refer to glossary in Appendix 4 for definitions. Totals may not add due to rounding
Slide 5: Digital growth continues
D I G I TA L G R O W T H C O N T I N U E S EBITDA, A$M REVENUE, A$M 200 DIGITAL REVENUE 700 +8% TO 44%1 OF GROUP REVENUE 180 600 160 500 140 DIGITAL EBITDA (WHOLLY OWNED) 120 +1% 400 100 300 80 60 200 40 100 20 0 0 H1 1FY20 H1 2FY21 H1 FY22 3 H1 FY23 4 Digital EBITDA Domain Digital EBITDA Digital re
Slide 6: Maria Phillips, Chief Financial Officer
MARIA PHILLIPS CHIEF FINANCIAL OFFICER 6
Slide 7: Group results – in line with guidance
G R O U P R E S U LT S – I N L I N E W I T H G U I D A N C E GROUP GROUP GROUP H1 REVENUE EBITDA MARGIN DIVIDEND $1,403M $370M 26.4% 6.0 CPS (+5%) (-9%) A$M H1 FY23 H1 FY22 VARIANCE REVENUE1 1,403.3 1,332.9 +5% GROUP EBITDA1 370.5 406.3 (9%) EBIT1 289.8 330.3 (12%) GROUP NPAT, PRE MINORITIES1 190.0
Slide 8: Specific items
S PE C I FI C I TE M S A$M H1 FY23 DOMAIN - REFER DOMAIN ACCOUNTS (ASX:DHG), 16TH FEB 2023 (2.3) RESTRUCTURING COSTS (1.6) NET PROFIT ON SALE OF INVESTMENTS AND OTHER ASSETS 2.9 TOTAL SPECIFIC ITEMS BEFORE TAX (1.0) TOTAL TAX RELATING TO SPECIFIC ITEMS 0.5 NET SPECIFIC ITEMS AFTER TAX (0.5) Refer to
Slide 9: Timing impacts on first half cash flows expected to unwind in H2
T I M I N G I M PAC T S O N F I R S T H A L F C A S H F L O W S EXPECTED TO UNWIND IN H2 CASH CONVERSION 1 H1 FY23 CAPEX 1 63% $30M H1 FY23 H1 FY23 H1 FY22 A$M DOMAIN REPORTED ADJUSTED1 ADJUSTED1 EBITDA (BEFORE ASSOCIATES) 370.5 49.3 321.2 344.3 WORKING CAPITAL (121.0) (3.4) (117.6) (33.0) ASSOCIATE
Slide 10: Balance sheet remains strong with capacity
B A L A N C E S H E E T R E M A I N S S T R O N G W I T H C A PAC I T Y A$M AS AT 31 DECEMBER 2022, A$M WHOLLY OWNED GROUP DOMAIN CONSOLIDATED GROUP INTEREST BEARING LOANS AND BORROWINGS 433.2 204.2 637.4 LESS: CASH AND CASH EQUIVALENTS (141.8) (31.7) (173.5) NET DEBT/(CASH) 291.4 172.5 463.9 NET LE
Slide 11: Divisionals
DIVISIONALS FY23 INTERIM RESULTS 11
Slide 12: Broadcast – TV & Radio
BROADCAST – T V & RADIO Revenue1 contribution – H1 FY23 A$M H1 FY23 H1 FY22 VARIANCE REVENUE TOTAL TELEVISION 661.7 632.8 +5% RADIO 54.1 48.9 +11% BROADCAST REV 715.8 681.7 +5% COSTS TOTAL TELEVISION 444.6 396.2 +12% RADIO 47.7 42.5 +12% EBITDA1,2 contribution – H1 FY23 BROADCAST COSTS 492.3 438.7 +
Slide 13: Total Television – share gains across all platforms
T O TA L T E L E V I S I O N – S H A R E G A I N S AC R O S S A L L P L AT F O R M S DIGITAL REVENUE TOTAL NINE REVENUE MARKET 1 GROW TH TO $1.6B $662M LINEAR (-5%) (+5%) REVENUE A$M H1 FY23 H1 FY22 VARIANCE REVENUE FTA 573.1 558.5 +3% 9NOW 88.6 74.3 +19% TOTAL TV REVENUE 661.7 632.8 +5% TOTAL TV CO
Slide 14: FTA Television – strong ratings & share performance
F TA T E L E V I S I O N – S T R O N G R AT I N G S & S H A R E P E R F O R M A N C E #1 #1 #1 RATINGS RATINGS RATINGS SHARE SHARE SHARE 25-54s 1 16-39s 1 GB+CH 1 METRO FTA NINE #1 METRO REGIONAL MARKET NETWORK REVENUE REVENUE -6%2 REVENUE SHARE SHARE 3 +3% 39.6%2 37.2%2 (+3.6 pts) (+2.8 pts) • Stro
Slide 15: 9Now – Live now accounts for > half of 9Now minutes
9NOW – LIVE NOW ACCOUNTS FOR > HALF OF 9NOW MINUTES GROW TH IN LIVE DAILY ACTIVE USERS TOTAL LIVE MINUTES STREAMS +17% 1 +24% 2 +13% 2 9NOW REVENUE BVOD MARKET # 1 BVOD MARKET +19% +5% TO $204M3 SHARE 47.1% (+ 4.8 pts) • Live continues to drive core growth in active users and streams • Live now acco
Slide 16: Nine Radio – strong growth in streaming revenues
NINE RADIO – STRONG GROW TH IN STREAMING REVENUES RADIO MARKET NINE RADIO DIGITAL REVENUE 59M STREAMS 2 +5%1 AGENCY SHARE UP 122% ON PCP UP 36% NINE RADIO AD ~1 PT ON H2 FY22 REVENUE GROWTH +7% A$M H1 FY23 H1 FY22 VARIANCE REVENUE BROADCAST 52.1 48.0 +9% DIGITAL incl. STREAMING 2.0 0.9 +122% TOTAL R
Slide 17: Stan – content drives subscriber growth
S TA N – C O N T E N T D R I V E S S U B S C R I B E R G R O W T H Revenue1 contribution – H1 FY23 ACTIVE REVENUE GROW TH IN SUBSCRIBERS GROW TH OVERALL ARPU APPROACHING +12% +8% 2.6M A$M H1 FY23 H1 FY22 VARIANCE REVENUE 206.4 183.5 +12% COSTS – STAN 150.7 131.7 +14% ENTERTAINMENT COSTS – STAN SPORT
Slide 18: Nine Publishing – strong performance
NINE PUBLISHING – STRONG PERFORMANCE Revenue1 contribution – H1 FY23 DIGITAL REVENUES GROW TH IN ACTIVE >60% OF TOTAL SUBSCRIPTION SUBSCRIPTIONS REVENUE REVENUE ~450K UNDERPINNED BY DIGITAL A$M H1 FY23 H1 FY22 VARIANCE DIGITAL SUBSCRIPTION & LICENSING 89.0 84.6 +5% REVENUE ADVERTISING 77.6 84.3 (8%)
Slide 19: Domain – challenging market conditions
D O M AI N – C HAL L E N GI N G MARKET CONDITIONS Revenue1 contribution – H1 FY23 A$M H1 FY23 H1 FY22 VARIANCE REVENUE RESIDENTIAL 119.4 120.3 (1%) MEDIA, DEVELOPERS & 24.7 25.4 COMMERCIAL (3%) AGENT SOLUTIONS 20.4 7.5 +172% DOMAIN INSIGHTS 8.4 6.6 +28% CORE DIGITAL 172.9 159.8 +8% CONSUMER SOL’NS 4
Slide 20: Trading Update & Outlook
T RA DING UPDAT E & OUTLOOK MIKE SNEESBY 20
Slide 21: Trading Update
TRADING UPDATE Total Television Radio Stan Publishing Domain Strong start to the 2023 TV Radio ad market Strong content Digital audiences Underlying property year for Nine holds up performance at Stan continue to grow market remains challenging Metro FTA advertising market Q3 impacted by a softer Ni
Slide 22: International
INTERNATIONAL “ Yge ms Me) ae rRUGBY eS ISLOE CUP Se o E (Q\\ so Eee Te RIBILLIE JEAN BD 2 , 8 kina cup RUGBY dpe Isps' aN AUSTRALIAN PEN vsownt a origi I |i “y, FRANCE 2023 wht D) DAVIS CUP . ° WORLD CuP 2 | Sy Rakuten y| r (USPEEDSERIES FY23 INTERIM RESULTS
Slide 23: Australia's Olympic Network
Nine (3) AUSTRALIA’S OLYMPIC NETWORK BRISBANE MILANO CORTINA Panis NS 2024 2026
Slide 24: All Audiovisual
?Nine ALL AUDIOVISU FREE TO AIR TELEVISION | ALL PLATFORMS | VOD 7 / iM | SUBSCRIPTION SUPPORTED BY The Sydney Morning Herald THE exe2 AGE WaAtoday brisbane times FINANCIAL REVIEW. 2GB 3AW 4BC GPR SUNDAY TheSundera® TRAVELLER — Fifidii¢ial Review Magazine @goodfood Fin! 28P@DCASTS
Slide 25: We shape culture by sparking conversations
25 We shape culture by sparking conversations, challenging perspectives, and entertaining communities. We bring people together by celebrating the big occasions and connecting the everyday moments. Australia Belongs Here. FY23 INTERIM RESULTS
Slide 26: Appendices
APPENDICES FY23 INTERIM RESULTS 26
Slide 27: Appendix 1: Group Divisional Results
APPENDIX 1: GROUP DIVISIONAL RESULTS Revenue1 contribution – H1 FY23 H1 FY23 BROADCAST PUBLISHING STAN DOMAIN CORPORATE ASSOCIATES INTERSEGMENT TOTAL A$M REVENUE 715.8 299.7 206.4 186.6 1.7 - (6.9) 1,403.3 PCP 681.7 299.6 183.5 175.3 2.5 - (9.7) 1,332.9 % CHG +5% - +12% +6% (32%) - (29%) +5% EBITDA1
Slide 28: Appendix 2: Linear TV Ratings
APPENDIX 2: LINEAR TV RATINGS 2022, COMMERCIAL RATINGS SHARE NETWORK PRIMARY CHANNEL METRO MARKETS Seven Nine Ten Seven Nine Ten SURVEY 2022 (WEEKS 7-48, EXCL TOTAL 6PM-MIDNIGHT 39.1 38.6 22.2 39.3 40.0 20.7 EASTER) PEOPLE 25-54S 34.5 38.3 27.3 34.5 39.8 25.8 16-39S 35.3 37.5 27.2 34.9 39.7 25.4 GS+
Slide 29: Appendix 3: Forward Estimates
APPENDIX 3: FORWARD ESTIMATES ITEM FY23 CORPORATE COSTS – WHOLLY OWNED ~$35M TO 38M DEPRECIATION & AMORTISATION - REPORTED ~$150M TO 160M INTEREST EXPENSE - REPORTED ~$40M TAX RATE - REPORTED ~30% CAPEX (EX DOMAIN) ~$75 TO 85M DIVIDEND 60-80% OF NET PROFIT AFTER TAX, BEFORE SPECIFIC ITEMS 29
Slide 30: Appendix 4: Glossary
APPENDIX 4: GLOSSARY ARPU – Average Revenue Per User Net Leverage (wholly owned) – Net Debt (wholly owned) divided by wholly owned Group Broadcast – Broadcast comprises Nine Network, 9Now and Nine Radio. EBITDA plus dividends received (last 12 months) BVOD – Broadcast Video on Demand Net Profit afte
Slide 31: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER Important Notice and Disclaimer This document is a presentation of general background information about the activities of Nine Entertainment Co. Holdings Limited (“NEC”) current at the date of the presentation, (23 February 2023). The information contained in this pre
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Nine Entertainment Co. Holdings — H1 FY2023 Earnings Presentation on 6ix