Tom Group Limited · HKEX:2383
Tom — Non-Deal Roadshow (July 2003)
27 slides from Tom's roadshow presentation, July 2003
Slide 1: TOM Delivers: The TOM Group European Roadshow
Under One Umbrella TOM Delivers The TOM Group European Roadshow July 2003
Slide 2: Part I: A Unique Media and Communications Platform in Greater China
Part I A Unique Media and Communications Platform in Greater China 2
Slide 3: Compelling Media Opportunity in Asia
Compelling Media Opportunity in Asia Global Media Market Asia’s Media Market TOM’s Competitive Positioning Mature & consolidated Nascent & fragmented Leading position in Greater China’s key media sectors Media conglomerates Few players have regional entrenched in home reach Expertise in
Slide 4: A Greater China Media & Communications Group
A Greater China Media & Communications Group Online & Outdoor Sports & Publishing Telecom VAS Advertising Entertainment Continued focus on building scale and leadership in each of our sectors 4
Slide 5: Supportive, Committed & Active Shareholders
Supportive, Committed & Active Shareholders Monthly meetings Ms Solina Chau is a long-time business partner of Mr. Li Ka Shing 11-member Board of Directors: Chairman, Executive Directors (2), Non-Executive Directors (6), Independent Non-Executive Directors (2) Hutchison Cheung Kong Strategic W
Slide 6: Part II: Sector Review
Part II Sector Review 6
Slide 7: ONLINE: The China Internet & Telecom VAS Market
ONLINE: The China Internet & Telecom VAS Market TOM focused on high-margin subscription-based Telecom VAS business Enhance branding, traffic and media influence of portal business Positioned to capture the expanding mobile phone user population of 200M+ Market Statistics Online ad: Online ad:
Slide 8: ONLINE: Continued Growth in Wireless Data Services
ONLINE: Continued Growth in Wireless Data Services ServiceHighlights Wireless Online Advertising Short Messaging Major clients include: China Mobile, Legend, Eachnet, Yang Shengtang Total Users 15M+ Cross platform promotion – co-branding National Campus Average Daily Volume 5M Tour with Kej
Slide 9: ONLINE: Leading Telecom VAS Operator in China
ONLINE: Leading Telecom VAS Operator in China Total Revenue Q1 2003 Non-Advertising Revenue US$‘M 15% Q-o-Q US$‘M On par with growth HK$’million 12.2 leading 11.7 operator 10.8 12.2 7.8 10.6 84 78 Telecom VAS Online Advertising Q4 2002 Q1 2003 Sohu Sina TOM Netease Wireless Revenue Average Daily SMS
Slide 10: ONLINE: Established Core Competence
ONLINE: Established Core Competence Strategy I: T-2-T (Traffic to Transactions) 2000 2001 2002 Current 350,000 10M 15M SMS Content Subscribers 20M free users - - 350,000 MMS Content Subscribers 60,000 700,000 900,000 Mobile & Pay E-mail Subscribers Strategy II: Integrated Telecom Value-Added Service
Slide 11: OUTDOOR: The China Outdoor Advertising Market
OUTDOOR: The China Outdoor Advertising Market Outdoor advertising market highly fragmented – current TOM market share ~5% Market maintaining 15% CAGR China Outdoor Media Operators 2003 Global Outdoor Advertising Expenditure US$ Millions No. of Operators 50,928 5,000 Total Outdoor Media Units 1,4
Slide 12: OUTDOOR: Nationwide Network Established
OUTDOOR: Nationwide Network Established Extensive Regional Coverage Primary focus on Billboards & Street Unipoles Furniture 13% Transport Unipoles Shenyang 10,000+ advertising panels in 43% 5,000 prime locations 3% Dalian Beijing Sales operations in 25 key Jinan economic cities Zhengzhou Qingd
Slide 13: OUTDOOR: Sales Operations & Network Management
OUTDOOR: Sales Operations & Network Management Sales Strategy Value of the Nationwide Network TOM Outdoor Sales Force Increase utilization above and beyond 80% with additional occupancy on idle assets – for use on nationwide campaigns Network Sales Teams One-stop shop to provide full service r
Slide 14: PUBLISHING: The Greater China Publishing Market
PUBLISHING: The Greater China Publishing Market Mainland China – large but highly fragmented and regulated Taiwan – smaller relative to Mainland China and Hong Kong, but more vibrant Hong Kong – market is limited in size, very competitive and highly saturated Total Greater China Publishing Tai
Slide 15: PUBLISHING: A Greater China Platform
PUBLISHING: A Greater China Platform Extensive Print Media Portfolio Renowned Publishing Brands Magazines Mainland China Over 60 titles 70 million annual circulation Books SDX Joint Popular Publishing Co Computer Group 23 imprints publishing ~1,500 new titles a year, backlist of 8,000+ tit
Slide 16: PUBLISHING: The 3-Stage Strategy
PUBLISHING: The 3-Stage Strategy Step 1 Step 2 Step 3 Taiwan Market Consolidation Integration Mainland China Expansion After initial consolidation of Taiwan publishers, individual subsidiaries now restructured into single HOLDCO • Resulting in an attributable ~83% shareholding to TOM • Facilitate
Slide 17: SPORTS: The China Sports Market
SPORTS: The China Sports Market China Sports Market as % of GDP Key Growth Drivers 1.5% 1.3% Gradual Price Inflation VS 0.25% Endorsement Fees Endorsement Fees ~GBP1.5M/year ~US$600K/year China (Now) China (2010) US (Current) VS Mainland China Sports Market Broadcast Rights Broadcast Rights US$’M
Slide 18: SPORTS: Event Marketing & Programme Production
SPORTS: Event Marketing & Programme Production Sporting Rights Integrated Services Event sponsorship Extensive portfolio of commercial Event management sporting rights in China: Athlete sponsorship • Basketball PR service Ticket sales • University Soccer TV programming • Women’s Soccer • Volleybal
Slide 19: ENTERTAINMENT: The China TV Advertising Market
ENTERTAINMENT: The China TV Advertising Market GLOBAL TOP 10 ADVERTISING MARKETS Breakdown of Y2003 China ADSPEND US$'M 1995 2005 CAGR Magazines TELEVISION Newspapers 3% 37% 41% USA 98,046 156,323 4.8% Japan 33,526 38,156 1.3% Germany 14,224 18,052 2.4% Radio Outdoor 4% 15% United Kingdom 10,092 15,
Slide 20: ENTERTAINMENT: Entry into China Broadcasting
ENTERTAINMENT: Entry into China Broadcasting Acquisition of China Entertainment Television The Channel Partnering with AOL Time Warner CETV is a 24 hour Mandarin language channel delivering dynamic and compelling world entertainment content Turner Broadcasting The first foreign TV channel to b
Slide 21: SPORTS & ENTERTAINMENT: Extending the Platform
SPORTS & ENTERTAINMENT: Extending the Platform Content enhancement by integration of Further leveraging on internal creative existing relationships with resources: CCTV and local TV stations Mook, Business Weekly, Sports Programming Content Distribution Advertising Nationwide Advertising Sales Netwo
Slide 22: Part III: Financial Analysis
Part III Financial Analysis 22
Slide 23: Y2003 Q1: Y-o-Y Improvement
Y2003 Q1: Y-o-Y Improvement Group Revenue Group EBITDA US$’M US$’M 5 52.7 Offline 40% increase 34.0 1.3 40.6 US$5.8M 29.1 improvement (4.5) Online 2.5x organic 12.1 4.9 growth (5) Q1 2002 Q1 2003 Q1 2002 Q1 2003 23
Slide 24: Y2003 Full Year: Delivering Continued Growth
Y2003 Full Year: Delivering Continued Growth Revenue 2003 Revenue Mix Publishing 40% US$’M Outdoor 16% (Y2002:46%) (Y2002:15%) 208.2 Online 26% (Y2002:16%) Sports & Entertainment 18% (Y2002:23%) 175.4 80.4 Taiwan 38% (Y2002:43%) 61.9 Q1 Revenue 40.6 US$53M 18.5 32.8 12.1 2001 2002 Hong Kong 3% China
Slide 25: Outlook
Outlook On Track for Profitability Balancing Growth With Stable Cashflow US$’M Refocusing from revenue growth to margin expansion Improving EBITDA Key drivers to improvement will be higher margin margin businesses from Online – adjusting revenue mix of Online VS Offline 6.7 Continue to emphasi
Slide 26: Strengthening the Balance Sheet
Strengthening the Balance Sheet HKD 2001 2002 03.07.2003 Pro Forma Share Placement on Bank Balances and cash 30 42 128 170 3rd July 2003 Trade and other receivables 66 83 83 • 450M shares @ HK$2.30 • Net proceeds of HK$995M Interests in jointly controlled, associated (US$128M) companies and investme
Slide 27: 2003 Target: US$250M in Revenues
2003 Target: US$250M in Revenues Media & Telecom Entertainment VAS Other Sports Internet Wireless Publishing Outdoor Entertainment Online Telecom Marketing Access VAS VAS Focus Focus on on Transformational Transformational Transactions Transactions … … 27