Southern Cross Media Group Limited · ASX:SXL
Southern Cross Media — Investor Presentation (August 2024)
32 slides from Southern Cross Media's investor presentation, Aug 29, 2024
Slide 1: FY24 Results
Slide 2: Overview
OVERVIEW. _ JOHN KELLY CEO & MANAGING DIRECTOR
Slide 3: FY24 Results Summary
FY24 RESULTS SUMMARY Revenue NRR Costs1,2 EBITDA1 $499.4m $308.4m $66.2m FY23: $504.3m FY23: $301.0m FY23: $77.2m Capex Net Debt Dividend $15.8m $107.5m 1.0cps FY23: $19.3m June 23: $105.0m Interim: 1.0cps Final: 0.0cps 1 Excludes significant and other non-recurring items. See appendix for details a
Slide 4: FY24 Headlines
FY24 HEADLINES Dominating the audiences that Improved H2 performance with matter leading the metro radio 25- Growing metro radio revenue share EBITDA YOY1 growth of 6% 54 demographic for 24 consecutive every month since December 2023 including 8% growth in Audio surveys Non-Revenue Related (NRR) Cos
Slide 5: Earnings Momentum Grew in H2
EARNINGS MOMENTUM GREW IN H2 $ millions FY24 FY23 YoY EBITDA1 EBITDA1 Var $ July – Dec (H1) Broadcast Radio 42.8 51.7 (9.0) • Earnings growth in H2 has partially offset declines Digital Total Audio (8.6) 34.2 (10.5) 41.2 1.9 (7.0) in H1 Television 9.8 14.3 (4.4) • $10m turnaround in Audio with Broad
Slide 6: Increased Revenue Momentum
INCREASED REVENUE MOMENTUM Advertising revenue momentum improved through H2 SCA Revenue Growth by Half across audio segments H1 H2 $ millions FY24 FY23 YoY 57.4% Revenue Revenue Var % July – Dec (H1) Broadcast Radio 184.0 188.1 (2.2%) Digital 15.6 12.3 27.0% 27.0% Total Audio 199.6 200.4 (0.4%) Tele
Slide 7: Leading Metro Radio Audiences That Matter
LEADING METRO RADIO AUDIENCES THAT MATTER SCA dominates the lucrative 25-54 demographic, which covers more than 70% of all agency briefs received, leading for 24 consecutive SCA Commercial Audience Share1 metro radio surveys 36.9% 33.4% SCA is the #1 radio home for People 25-54, with average share g
Slide 8: Dominating Metro Market Audiences and Increasing Revenue Share
DOMINATING METRO MARKET … AND INCREASING REVENUE AUDIENCES… SHARE Commercial Metro Radio P25-54 Audience Share1 H2 Metro Radio Revenue Market Share2 35% 30% 25% 20% S1 2023 S4 2023 S7 2023 S2 2024 Jan Feb Mar Apr May Jun Hit / Triple M Kiis KIIS/ /Gold Gold Nova / Smooth FY23 FY24 1 GFK Radio Share
Slide 9: Dominating Regional Audiences That Matter
DOMINATING REGIONAL AUDIENCES THAT MATTER SCA accounts for over 70% of Boomtown commercial radio audiences1 133 stations in 73 markets connecting advertisers to 3.56m radio listeners2 SCA’s regional audience has increased by 25% over the past 5 years3 1. GFK Radio Ratings. Latest Survey dated 8-Aug
Slide 10: LiSTNR Reaches 2M Signed Up Users
LISTNR REACHES 2M SIGNED UP USERS LiSTNR Signed Up Users 2.0m 1.8m • LiSTNR has reached 2.0m addressable Signed Up Users, with ~1.0m interacting with LiSTNR on at least a monthly basis1 1.5m • Stream starts have increased 17% and listening hours 7% on pcp1 1.2m • LiSTNR has Australia's Number 1 Podc
Slide 11: Digital Revenue Growth
DIGITAL REVENUE GROWTH Digital Revenues $35.0m CAGR • The momentum of LiSTNR’s Digital Revenue shows a strong and +34% consistent growth trajectory of 34% CAGR since FY20 $24.6m • FY24 has seen accelerated revenue growth – with 42% YoY growth $20.8m and 57% growth in Half 2 FY24, setting up momentum
Slide 12: Digital Audio Segment Profitable During Q4FY24
DIGITAL AUDIO SEGMENT PROFITABLE DURING Q4FY24 Digital EBITDA Q4 FY24 • The LiSTNR Digital Audio segment has achieved EBITDA profitability in Q4FY24, with strong revenue growth off the back of ad tech investment and disciplined cost management $(2.3m) -$2.2m • LiSTNR is expected to be cashflow posit
Slide 13: Major Capex Investment Complete
MAJOR CAPEX INVESTMENT COMPLETE Capex FY22 -> FY25 Actual Forecast $29.9m • Capital expenditure reduces significantly now that investment in digital transformation is complete $19.3m $15.8m • Future capex is focused on growth opportunities delivering $15.9m improvements to LiSTNR advertiser & AdTech
Slide 14: Cost Out Program Delivering Cash Savings
COST OUT PROGRAM DELIVERING CASH SAVINGS NRR Cost Growth by Half1 4.5% • Significant cost pressures in FY24, including high inflation2 & employment cost pressures3 • FY24 cost out program is delivering benefits, with NRR costs growth reducing to 0.4% in H2, to finish the year +2.5% at $308.4m1, ahea
Slide 15: Financial Results
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Slide 16: Group Results
$ millions FY24 FY23 Var $ Var % Revenue 499.4 504.3 (4.9) (1.0%) GROUP RESULTS Revenue Related Expenses (124.7) (126.0) 1.3 1.0% Non-Revenue Related (308.4) (301.0) (7.4) (2.5%) Expenses Total Expenses (433.2) (427.1) (6.1) (1.4%) • Group revenues fell 1.0% from FY23. Digital grew 42%, offsetting E
Slide 17: Broadcast Radio
BROADCAST RADIO $ millions FY241 FY231,2 Var $ Var % • Broadcast radio revenue decreased by $6.0m, a 1.6% decline: Revenue 366.6 372.6 (6.0) (1.6%) • Metro Radio revenue dropped by 2.7% ($5.0m) amid an industry-wide downturn; SCA increased its market share in H2 and for the year to 27.2% Revenue Rel
Slide 18: Digital
DIGITAL $ millions FY241 FY231,2 Var $ Var % Revenue 35.0 24.6 10.4 42.2% • Strong digital revenue growth of 42.2% or $10.4m to $35.0m, driven by improved performance in LiSTNR InStream and Podcast Revenue Related Expenses (7.4) (6.3) (1.1) (18.2%) revenue lines • Total expenses increased by 8.8%, w
Slide 19: Television
TELEVISION $ millions FY241 FY231 Var $ Var % Revenue 97.5 106.7 (9.3) (8.7%) • Due to significant market pressures and audience challenges, Television revenues decreased by 8.7% to $97.5m. National revenues declined 11.5% and Local revenues declined 9.0% Revenue Related Expenses (46.0) (51.4) 5.3 1
Slide 20: Cashflow
$ millions FY24 FY23 Var $ Net Debt Start of Period (105.0) (78.5) (26.5) Net Cash from Operations 37.3 64.2 (26.8) CASHFLOW Principal lease payments (7.4) (6.5) (0.9) Capex net of sales proceeds (8.9) (21.3) 12.4 Free cash flow 21.0 36.4 (15.4) Net Financing Costs (13.4) (10.6) (2.7) • Operating Ca
Slide 21: Slide 21
Slide 22: Strategic Review of Television Assets
STRATEGIC REVIEW OF TELEVISION ASSETS • SCA's core strategic focus is to be "All About Audio" and to be the most profitable local Audio company in Australia led by LiSTNR, HIT Network and Triple M Network • With the conclusion of the recent corporate activity, we have re-initiated a Strategic Review
Slide 23: Audio is Resilient & Positioned for Growth
AUDIO IS RESILIENT & POSITIONED FOR GROWTH Weekly AM/FM/ Weekly On-Line • Commercial radio audiences are at an all-time high DAB+ Listening2 Listening2 with 12.2m people listening each week to Metro radio and 5.2m people listening each week to Regional 81% radio1 79% 79% 79% 77% • People spend ~16 h
Slide 24: FY25 Outlook
FY25 OUTLOOK • Audio revenues for Q1 pacing ahead of prior year although the market remains short • Operating model reset will deliver FY25 Non-Revenue Related costs below FY24 ($308.4m)1 • FY25 Capex to reduce further to approximately $10m • Improved cash conversion will deliver leverage below 1.5
Slide 25: Q&A
Q&A 25
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Slide 27: Disclaimer
DISCLAIMER SUMMARY INFORMATION The material in this presentation has been prepared by Southern Cross Media Group Limited ABN 91 116 024 536 (SCA) and contains summary information about SCA’s activities current as at 29 August 2024. The information in this presentation is of a general background natu
Slide 28: Appendix
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Slide 29: Significant and Non-Recurring Items
APPENDIX SIGNIFICANT AND NON-RECURRING ITEMS FY24 Restructuring NBIO In addition to the non-cash impairment charge of $326.1m $ millions Other Total ($228.3m after tax) in FY24 for the Broadcast Radio CGU, the Charges Response Broadcast Radio 2.7 0.0 0.0 2.7 significant and other non-recurring items
Slide 30: Reconciliation to Reported NPAT
APPENDIX RECONCILIATION TO REPORTED NPAT FY24 FY23 FY24 FY24 NRIs & FY24 FY23 FY23 NRIs & FY23 $ millions $ millions Reported Impairments Underlying Reported Impairments Underlying EBITDA 55.5 10.7 66.2 EBITDA 73.3 4.0 77.2 Depreciation & Amortisation (31.1) 0.0 (31.1) Depreciation & Amortisation (2
Slide 31: Reconciliation to FY23 Investor Presentation
APPENDIX RECONCILIATION TO FY23 INVESTOR PRESENTATION FY23 FY23 $ millions Adjustment Presented Adjusted Broadcast Radio Revenue 372.6 0.0 372.6 Revenue Related Expenses (68.4) (0.1) (68.5) Non-Revenue Related Expenses (212.1) 5.9 (206.2) Total Expenses ( 280.5 ) 5.8 (274.7) Adjustments have been ma
Slide 32: Broadcast Radio Revenue
APPENDIX BROADCAST RADIO REVENUE METRO Radio Advertising Revenue REGIONAL Radio Advertising Revenue $186.2m $181.1m $161.9m $163.1m +1.3% $41.4m $42.0m +4.0% $95.5m $99.3m (3.9%) $144.8m $139.1m $66.5m (4.0%) $63.8m FY23 FY24 FY23 FY24 Agency Direct National Local Advertising Revenues only, excludin
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