Nexstar Media Group, Inc. · NASDAQ:NXST
Nexstar Media — Investor Presentation (September 2016)
27 slides from Nexstar Media's investor presentation, September 2016
Slide 1: Investor Presentation
Investor Presentation Perry Sook, Chairman, President & CEO Keeping it Local Tom Carter, EVP & CFO NXST: NASDAQ September 2016
Slide 2: Safe Harbor
Safe Harbor Forward-Looking Statements This communication includes forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. Forward-looking statements include information preceded by, followed by, or that includes the
Slide 3: Keeping it Local/Driving Diversification
Keeping it Local/Driving Diversification Local Diversified Media Company with Leading Broadcast Television and Digital Media Properties 104 Full Power 37 Duopoly +1,640 Weekly 60+ Community TV Stations Markets Local News Hours Web Portals 62 Markets ~18.1% U.S. ~80% “Big 4” Profitable Digital 25 Sta
Slide 4: Recent Key Operating Events
Recent Key Operating Events Record Financial Results 3M Ended June 30 6M Ended June 30 (in millions) (in millions) 3M Change (%) 6M Change (%) 2016 2015 2014 2016 2015 2014 ‘16 vs. ‘15 ‘16 vs. ‘14 ‘16 vs. ‘15 ‘16 vs. ‘14 Last Even-Year Net Revenue $262.0 $219.3 $146.9 $517.7 $421.1 $280.8 +19.5% +
Slide 5: Strong Industry Fundamentals
Strong Industry Fundamentals BIA Kelsey: Local Video Ad Revenue Projected Local Broadcast TV Large-Scale Reach, Greatest Share of Projected Distribution Across Media (%) Core Ad Revenue (Ex-Political, $ billions) Viewership and Superior Engagement Mobile Video 2% SNL Kagan BIA Kelsey Online Video 3%
Slide 6: Facts: OTT/Streaming Data Caps and Millennial Video Viewership
Facts: OTT/Streaming Data Caps and Millennial Video Viewership According to the WSJ, some consumers are canceling Nielsen Research confirms that millennial’s total TV their streaming services to avoid significant overage viewing changes through life stages fees associated with exceeding data caps St
Slide 7: Near term Drivers: Political and Retransmission Consent Fees
Near term Drivers: Political and Retransmission Consent Fees Local Broadcast TV Political Ad Revenue Growth SNL Kagan: Projected Broadcast Retrans Growth ($ billions) ($ billions) $11.2 Presidential Election Gross Retransmission Revenue $10.6 $3.3-3.6 $10.1 Mid-Term Election $9.4 $8.6 $2.9 $7.7 $6.4
Slide 8: Growth in NXST Political and Issue Advertising
Growth in NXST Political and Issue Advertising NXST Political Ad Revenue Growth NXST 2016 Political ($ millions) Key Senate and Gubernatorial Elections Even Year Odd Year 2016 Senate Races 2016 Gubernatorial Races CAGR: 25% 2008-2014 CAGR: 29% 2009-2015 Nexstar Market Incumbent Party Nexstar Market
Slide 9: Growth in NXST Retransmission and Digital Media Revenue
Growth in NXST Retransmission and Digital Media Revenue Retransmission and Digital Media revenue is materially diversifying NXST’s total net revenue NXST Retransmission & Digital Media Revenue NXST Retransmission Revenue ($ millions) $298.0 (% of Total Net Revenue) Retransmission Revenue as a % of T
Slide 10: Consolidation Is Reshaping the Industry Landscape
Consolidation Is Reshaping the Industry Landscape Sorted by percent of US TV households reached 2011 – 33 Major Affiliate Groups 26% 20% 18% 18% 13% 14% 9% 10% 10% 10% 10% 6% 6% 6% 6% 6% 7% 7% 8% 4% 4% 4% 4% 5% 2% 2% 3% 3% 3% 3% 3% 3% 3% 2016 (Pro-Forma) for all announced transactions – 15 Major Aff
Slide 11: NXST M&A Snapshot 2011-2016
NXST M&A Snapshot 2011-2016 60 TV stations, six low power signals and four digital businesses acquired1 in accretive transactions (Ex-MEG) 2011 2012-2014 2015-2016 Liberty Media Corporation Newport Television CCA 2 Stations / 2 Markets Newport #1 13 Stations / 9 Markets* Green Bay, WI / Marquette, M
Slide 12: NXST/MEG: A Complementary Combination
NXST/MEG: A Complementary Combination Pure-Play Broadcasting and Digital Media Leader Positioned for Long-term Success Creates leading pure-play broadcast operator – Top 2 television broadcaster maximizes benefits of increased scale - $2.3 bn of annual revenue – Strong and complementary nationwide
Slide 13: Leading Pure-Play Broadcast Operator
Leading Pure-Play Broadcast Operator U.S. TV Households Reached Highlights Tribune 44% Media General transaction increases Nextar’s broadcast portfolio by NXST/MEG 39% approximately two-thirds Sinclair 38% More than doubles Nexstar’s current audience reach TEGNA 31% Provides entrée to 15 new t
Slide 14: Leading Pure-Play Broadcast Operator
Leading Pure-Play Broadcast Operator Pro forma: 171 Television Stations in 100 markets reaching ~38.9% of all U.S. TV HH Transaction provides entry into 15 top 50 DMAs ____________________ Source: Company filings. Pro Forma Nexstar Media Group Markets 14
Slide 15: Transaction Update
Transaction Update February 2016 – Financing commitment for bank syndication closed, consisting of ten lenders March 2016 – Preliminary Form S-4 filed with SEC1 May / June 2016 – Form S-4 declared effective – Shareholders of NXST and MEG voted to approve merger and acquisition of MEG by NXST –
Slide 16: Expanding and Diversifying Revenue Mix
Expanding and Diversifying Revenue Mix Monetizing the local opportunity through five-tiered high NXST Revenue Mix (% of Total Gross Revenue) margin revenue stream business model Non-TV Spot revenue (ex-Political) comprised – Television (on-air) 25% of 2011 gross revenue of $338.1 mm – Digital/Mobi
Slide 17: Local News/Programming
Local News/Programming NXST’s local news rank among top 2 in approximately two-thirds of markets – Strong community presence, extensive local sports coverage, active sponsorship of community events Garnered nearly 500 broadcasting and journalism awards since 2009 for outstanding local news progr
Slide 18: Network Affiliation Agreements
Network Affiliation Agreements Long-term record of negotiating mutually beneficial Network Affiliation agreements Long-term Affiliation Agreements 100% of all “Big Four” markets are renewed through YE2016 Creating the first NBC affiliate in Lafayette, LA and the MyNetworkTV affiliate in Waco, TX
Slide 19: Digital Media Marketing Solutions and Services
Digital Media Marketing Solutions and Services LAKANA: Enterprise-class Technology Solutions for Media Publishers • LAKANA delivers SaaS-ready content management platforms, which seamlessly integrate with a comprehensive suite of products and services that together enable media publishers to increas
Slide 20: Spectrum Auction/Timeline
Spectrum Auction/Timeline The Incentive Auction: How it Works Broadcaster offers to relinquish spectrum usage rights Broadcasters Mobile Broadband Reverse Providers Auction Mobile Broadband offers for spectrum licenses Forward Auction Auction Timeline March 29 April/May Early/Mid May August Aug/Sept
Slide 21: Financial Overview
Nexstar BROADCASTING GROUP, INC. Financial Overview
Slide 22: Growing Two-Year Free Cash Flow Cycle (FY)
Growing Two-Year Free Cash Flow Cycle (FY) Significant FCF Growth Since IPO NXST FCF based on two year cycles $368.0 ($ in millions) $165.4 $94.3 $45.4 $55.5 $46.2 2004/2005 2006/2007 2008/2009 2010/2011 2012/2013 2014/2015 Organic growth, fueled by political, digital and retransmission revenues, an
Slide 23: Historical Financial Summary (in millions)
Historical Financial Summary (in millions) FY Net Revenue FY Core Revenues $896.4 $522.9 $631.3 $389.1 $348.8 $502.3 $249.8 $237.7 $266.3 $378.6 $235.9 $247.3 $212.5 $313.4 $306.5 $266.8 $284.9 $252.0 $175.5 $171.6 $157.4 $173.9 $181.6 $190.2 $265.4 $279.2 $369.3 $74.3 $66.1 $55.1 $62.0 $65.7 $76.1
Slide 24: 2Q / Six Months 2016 Financial Summary
2Q / Six Months 2016 Financial Summary 1) Definitions and disclosures regarding non-GAAP financial information can be located in the Company’s Second Quarter 2016 Financial Results press release dated August 9, 2016 2) Broadcast cash flow margin is broadcast cash flow as a percentage of net revenue.
Slide 25: Debt/Leverage Analysis
Debt/Leverage Analysis TTM ENDED 3M ENDED (in millions) 12/31/2011 12/31/2012 12/31/2013 12/31/2014 12/31/2015 06/30/16 Revolver $ 24.3 $ - $ - $ 5.5 $ 2.0 $ 22.0 TLB 148.1 288.3 545.4 705.1 682.2 673.2 8.875% Sr Sec 2nd Lien Notes 318.4 319.4 - - - - 6.875% Sr Sub Notes - 250.0 525.7 525.6 519.8 52
Slide 26: Transformational Acquisitions and Operating Strategies Driving Record FCF
Transformational Acquisitions and Operating Strategies Driving Record FCF Continued double-digit growth of non-core revenue channels – Political: Even-year CAGR of 25% (2008-2014), odd-year CAGR of 29% (2009-2015) • NXST Political revenue expected to reach ~$100 mm in 2016 – Retransmission: Contra
Slide 27: Investor Presentation
Investor Presentation Perry Sook, Chairman, President & CEO Keeping it Local Tom Carter, EVP & CFO NXST: NASDAQ September 2016
Nexstar Media Group — Investor Presentation (September 2016) on 6ix