Nine Entertainment Co. Holdings Limited · ASX:NEC
Nine Entertainment — Investor Day (November 2020)
93 slides from Nine Entertainment's investor day presentation, Nov 19, 2020
Slide 1: Investor Strategy Day Presentation
INVESTOR STRATEGY DAY PRESENTATION 19 November 2020: Attached is a copy of the presentation to be given today at the Nine Entertainment Co. (ASX:NEC) Investor Strategy Day. This announcement was authorised for lodgment by the Company Secretary of NEC. Further information: Nola Hodgson Victoria Bucha
Slide 2: Investor Strategy Day, 19 November 2020
Poo W ERED INVESTOR STRATEGY DAY 19 NOVEMBER 2020
Slide 3: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER This document is a presentation of general background looking words such as, ‘expect’, ‘anticipate’, ‘likely’, ‘intend’, a promise, representation, warranty or guarantee as to the information about the activities of Nine Entertainment Co. ‘should’, ‘could’, ‘may’, ‘pr
Slide 4: Agenda
AGENDA SECTION TOPIC SPEAKER THE CHANGING TV LANDSCAPE & FREE-TO-AIR PART 1 HUGH MARKS, CEO, NINE TELEVISION PART 2 9NOW – BROADCAST VIDEO ON DEMAND HAMISH TURNER, PROGRAM DIRECTOR, 9NETWORK PART 3 9NOW SALES PROPOSITION MICHAEL STEPHENSON, CHIEF SALES OFFICER, NINE PART 4 STAN – SUBSCRIPTION VIDEO
Slide 5: Chief Executive Officer
CHIEF EXECUTIVE OFFICER WUGIA MARKS
Slide 6: Much has been achieved over the past 5 years
MUCH HAS BEEN ACHIEVED OVER THE PAST 5 YEARS Pre 2018 2018 – 2019 2020 and beyond Focus on premium M&A for scale, consolidation of Integration and optimisation video news and control of Stan • Demographic focus in FTA on • Merger with Fairfax and • Acceleration of digital 25-54s consolidation of Mac
Slide 7: The business is now structured in three key operating platforms
THE BUSINESS IS NOW STRUCTURED IN THREE KEY OPERATING PLATFORMS TELEVISION PUBLISHING MARKETPLACES Investing in the premium content Cross-platform publisher of digital Customer-centric, marketplace that drives profitability content, primarily news model, extension of classifieds Focusing on the effi
Slide 8: And we have accelerated our digital transformation
AND WE HAVE ACCELERATED OUR DIGITAL1 TRANSFORMATION Nine EBITDA %2,3 48% Digital FY18 FY19 FY20 Digital Domain Non-Digital 1 Digital includes 9Now, 9Digital, Stan and the digital components of Metro Media, as owned by Nine, FY18 pre AASB16 basis vs FY19 Pro Forma vs FY20 actual 2 Domain includes onl
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Slide 10: Television in all its forms is a growth business
IN ALL ITS FORMS IS A GROWTH BUSINESS 9
Slide 11: We are watching more television and more of Nine than ever before
WE ARE WATCHING MORE ‘TELEVISION’ AND MORE OF NINE THAN EVER BEFORE TELEVISION IN ALL ITS FORMS IS A GROWTH BUSINESS 1 2015 79% FTA BVOD Pay TV 2019 57% SVOD WITH NINE HOLDING SHARE OVER THE PAST FOUR YEARS 1 2015 23% Nine Netflix Other 2019 22% 1 Nine estimates of hours per capita per month, based
Slide 12: Viewing patterns are evolving
VIEWING PATTERNS ARE EVOLVING – NINE CAN CAPITALISE ON THAT EVOLUTION Nine Viewing by Genre – FTA1 Nine Viewing by Genre – Total Television1 3% 34% 29% 34% 37% 15% 17% 17% 12% 19% 13% 13% 17% 36% 37% 36% 31% 2015 2019 2015 2019 Newscaf 7:30 Strip Shows Sport Entertainment Kids ENTERTAINMENT CONTENT
Slide 13: Leveraging content across all of our platforms
LEVERAGING CONTENT ACROSS ALL OF OUR PLATFORMS 12
Slide 14: Solidifying our number one position
SOLIDIFYING OUR NUMBER ONE POSITION FREE TO AIR – BROADCAST VIDEO ON SUBSCRIPTION VIDEO ON NINE NETWORK DEMAND – 9NOW DEMAND – STAN #1 Network by Ratings #1 BVOD by Streams and #1 Local SVOD and Revenue share Revenue share Operator +56%1 +63%1 -4%1 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 FY17 FY18 F
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Slide 16: TV is still the most effective way to build brands
TV IS STILL THE MOST EFFECTIVE WAY TO BUILD BRANDS – DEC QTR NINE NETWORK REV EST 15% PLUS GROWTH NEW 16 December quarter (est) on December quarter 2019
Slide 17: Nine is the clear number one in free-to-air
NINE IS THE CLEAR NUMBER ONE IN FREE-TO-AIR Nine Prime Time1, Main Channel Ratings Share, 25-54s 39% 39% 37% 35% 35% FY16 FY17 FY18 FY19 FY20 Source: OzTAM, 5 City Metro, Consolidated 28 1 Prime Time: 6pm to 12 Midnight 17
Slide 18: Nine's peak programming has become more valuable
NINE’S PEAK PROGRAMMING HAS BECOME MORE VALUABLE Nine FY18-20 Revenue CAGR vs 25-54 Audience CAGR1 ~75% of Network rev2 Midnight to Other Today Newscaf Strips NRL Other prime Late night Multi 5pm Daytime time Channels 1 The difference in Nine’s 2 year revenue CAGR vs 2 year audience (Main channel, 2
Slide 19: Efficient content delivery has increased revenue share while reducing costs
OUR FOCUS ON EFFICIENT CONTENT DELIVERY HAS ENABLED US TO INCREASE REVENUE SHARE WHILST REDUCING COSTS $m 42% 1,000 40% 38% 36% 34% 500 32% FY15 FY16 FY17 FY18 FY19 FY20 FY21E FY22F FY23F FY24F FTA costs (LHS) Revenue share (RHS) 19
Slide 20: 9Now
INOW TAMISH] TURN 333JNOW Elk
Slide 21: The future of TV continues to evolve
THE FUTURE OF TV CONTINUES TO EVOLVE 2018 NOW VOD VOD + LIVE • Catch up service for Nine’s linear TV • One-stop entertainment platform content • Exclusive video on demand content + • Limited rights extended seasons and rights • Simultaneous LIVE streams of Nine’s linear TV channels 22 • ~9 million s
Slide 22: 9Now a destination in its own right
9NOW A DESTINATION IN ITS OWN RIGHT 9Now Content Consumption1 Average Age Profile2 18% 30% 30% 40% 52% 54% 56% 54 82% 37 70% 70% 60% 48% 46% 44% Mar Apr May Jun Jul Aug Sep FTA 9Now Catch-up Digital Exclusive Delivering a streaming experience with both local and international exclusive content, whil
Slide 23: Daily active users continue to grow strongly
24 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Note: Average DAUs per month Oct-19 Nov-19 Dec-19 Jan-20 DAILY ACTIVE USERS (DAUS) Feb-20 CONTINUE TO GROW STRONGLY Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20
Slide 24: 9Now is evolving from catch up to destination VOD platform
9NOW IS EVOLVING FROM A CATCH UP SERVICE TO A DESTINATION VOD PLATFORM, USING ACQUIRED CONTENT TO SMOOTH AUDIENCE 9Now VOD minutes (millions) Acquired Programming Love Island Franchise Linear Catch Up 25
Slide 25: Growing number of viewers use 9Now as preferred source of live viewing
WE HAVE SEEN A GROWING NUMBER OF VIEWERS USE 9NOW AS THEIR PREFERRED SOURCE OF LIVE VIEWING 9Now Minutes (millions) 1,200 FY19 Live FY20 Live YTD21 Live 27% of total 33% of total 35% of total 1,000 800 600 400 200 - Oct-19 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19
Slide 26: Significant opportunity to come for 9Now
THERE IS SIGNIFICANT OPPORTUNITY TO COME FOR 9NOW National Personalisation Coverage and Enhancement of Live All Rights Younger Growth in Demos Live Streaming 27
Slide 27: 9Now – Sales Proposition
9NOW - SALES PROPOSITION MICHAEL SilePRENSON
Slide 28: The future of advertising is addressability
The future of VOZ + Nine’s Our Adobe advertising is Adobe partnership will addressability partnership will be allow Nine to which delivers major drivers of compete in the higher CPMs 9Now revenue $1.2bn digital growth video market TARGETING A LONG TERM 50% SHARE OF THE BVOD MARKET 29
Slide 29: We have the leading linear and BVOD products
WE HAVE THE LEADING LINEAR AND BVOD PRODUCTS HOWEVER THEY ARE CURRENTLY MEASURED AND BOUGHT SEPARATELY Linear TV BVOD • 40% share of the Metro FTA market • 50% share of the BVOD market • Power ratio of 1.05 • Power ratio of 1.13 • ~$2.4bn market (FY20) • ~$210 million market (FY20) • Modelled age +
Slide 30: Virtual Oz (VOZ) will allow us to measure consumption of total TV
VIRTUAL OZ (VOZ) WILL ALLOW US TO MEASURE THE CONSUMPTION OF TOTAL TV P18-39 National Reach (Network Nine & Affil + 9NOW) 6.05M 6.00M 5.95M 5.91M 6,500,000 5.86M 10.0% 5.80M 5.75M 8.9% 9.0% 5.70M 5.64M 8.6% 5.57M 5.35M 5.42M 5.52M 5.47M 8.3% 9.0% 6,000,000 8.2% 7.9% 5.23M 7.7% 7.6% 7.5% 7.6% 7.6% 7.
Slide 31: VOZ will help to grow the total TV market
VOZ WILL HELP TO GROW THE TOTAL TV MARKET WHILE NINE’S 1ST PARTY DATA WILL INCREASE OUR SHARE AND CPM1 NINE’S 1st PARTY DATA VOZ Allows advertisers to target real people Prove that you need to maintain Using Nine Group’s 13 million signed in users linear TV budgets and add BVOD to maximise reach 1st
Slide 32: Total TV measurement and first-party data allow us to compete with social platforms
THE MEASUREMENT OF TOTAL TV AND NINE'S 1ST PARTY DATA ALLOWS US TO COMPETE WITH SOCIAL PLATFORMS ~$300m ~$2.4bn $1.2bn ~$250m 33 Source: SMI, ThinkTV, Industry sources, Nine internal estimates
Slide 33: A premium alternative to Facebook + Google
A PREMIUM ALTERNATIVE TO FACEBOOK + GOOGLE ALLOWING NINE TO COMPETE IN THE 34
Slide 34: Nine is the first publisher in the world integrated into the Adobe platform
NINE IS THE FIRST PUBLISHER IN THE WORLD TO BE INTEGRATED INTO THE ADOBE PLATFORM They upload their Segments are Once the segments are We can then measure Advertisers collect anonymised data matched and matched with Nine’s the ROI by linking ad 1st party data and segments into advertisers can choose
Slide 35: The best of television and the best of digital
“TRIEIBEST OF TELEVISION © Ta “+FTHE BEST OF DIGITAL -.* 36
Slide 36: Many major advertisers are already Adobe customers
MANY OF AUSTRALIA’S MAJOR ADVERTISERS ARE ALREADY ADOBE CUSTOMERS 37
Slide 37: By FY24, ~72% of 9Now revenue sold with data attached
BY FY24, WE ESTIMATE THAT ~72% OF 9NOW REVENUE WILL BE SOLD WITH DATA ATTACHED, AT A CPM PREMIUM 9Now Illustrative Revenue Profile ~72% ~36% FY20 FY21 FY22 FY23 FY24 Unaddressable Addressable VOZ Modelled Demo Adobe Targeted Adobe targeted advertising is Addressable advertising using SSO Advertising
Slide 38: Data assets to unlock premium advertising revenue opportunities
THROUGH OUR DATA ASSETS, WE WILL EXPECT TO CONTINUE TO UNLOCK PREMIUM ADVERTISING REVENUE OPPORTUNITIES ACROSS ALL OF NINE’S ADVERTISING PLATFORMS 63% 69% 73% 76% 79% 17% 12% 5% 8% 3% 19% 18% 19% 20% 18% FY20 FY21 FY22 FY23 FY24 Premium Data Other 39
Slide 39: The future of advertising is addressability
The future of VOZ + Nine’s Our Adobe advertising is Adobe partnership will addressability partnership will be allow Nine to which delivers major drivers of compete in the higher CPMs 9Now revenue $1.2bn digital growth video market TARGETING A LONG TERM 50% SHARE OF THE BVOD MARKET 40
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Slide 41: Stan
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Slide 42: The SVOD market is expected to grow to 16-24M subscriptions by FY25
THE SVOD MARKET IS EXPECTED TO GROW TO 16-24M SUBSCRIPTIONS IN AUSTRALIA BY FY25 80% 2-3 Household SVOD Subscriptions Penetration Per Household 10M 8M ~16M-24M Households Subscription Subscriptions Households 44
Slide 43: Stan continues to experience strong growth
STAN CONTINUES TO EXPERIENCE STRONG GROWTH Active Subscribers 2.2M+ 2.2M+ 2.2M 1.7M 1.65M 1.1M 1.1M 800K 0.55M 500K 150K 0.M Aug-15 Aug-16 Aug-17 Aug-18 Aug-19 Aug-20 45
Slide 44: Australia's leading local streaming service
AUSTRALIA’S LEADING LOCAL STREAMING SERVICE • Unique competitive position as clear local leader • Differentiated premium content line-up driving fast subscriber growth and high retention rates • Strong market position, with 2.2m subscribers, and significant EBITDA and positive cash flow Active Activ
Slide 45: We have built a business with strong momentum
WE HAVE BUILT A BUSINESS WITH STRONG MOMENTUM – OUR ACQUISITION MODEL CONTINUES TO DEMONSTRATE INCREASING EFFICIENCY B2C Gross Adds CPA Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 47
Slide 46: Total viewing hours increased by 3x in two years
IN THE LAST TWO YEARS TOTAL VIEWING HOURS INCREASED BY 3X AND ~1.4X ON A PER SUBSCRIBER BASIS Total viewing hours since launch Launch 2018 2020 48
Slide 47: Lifetime value of subscribers is increasing over time
THE LIFETIME VALUE OF SUBSCRIBERS IS INCREASING OVER TIME 25-30% 70-75% Conversion from trial to paid Churn drops exponentially after the 1st month ~2% 49 Months into Subscription
Slide 48: Long term output deals provide growing volume of premium exclusive content
OUR LONG TERM OUTPUT DEALS PROVIDE A GROWING VOLUME OF PREMIUM EXCLUSIVE CONTENT, COMPLEMENTED BY OUR STRATEGY TO GROW OUR SLATE OF STAN ORIGINAL PRODUCTIONS Exclusive titles: 150 Exclusive titles: 61 Exclusive titles: 53 from 17 distributors from 15 distributors 30 3 6 FY19 FY20 FY25F Stan Original
Slide 49: Stan will launch live sport in February 2021
STAN WILL LAUNCH ITS LIVE SPORT PROPOSITION IN FEBRUARY 2021 RUGBY TENNIS The Rugby Wallabies Tests Championship Super Rugby Super Rugby AU Aotearoa Bledisloe Cup Wallaroos Tests …with more to come Super W Shute Shield Hospital Cup Mitre 10 Cup Currie Cup 51
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Slide 51: Television Combined
TELEVISION COMBINED WUGIA MARKS
Slide 52: Nine's total television business is transforming
NINE’S TOTAL TELEVISION BUSINESS IS TRANSFORMING Composition of Total Television EBITDA 3% 14% 19% Subscription 23% Digital 38% 97% Free, advertiser- 63% supported 43% FY17 FY20 FY24F FTA 9Now Stan 54
Slide 53: Growth in BVOD expected to outpace declines in free-to-air
WE EXPECT THE GROWTH IN BVOD WILL OUTPACE DECLINES IN FREE-TO-AIR FROM FY21 Combined Nine FTA and 9Now revenue growth / decline % FY19 FY20 FY21E FY22F FY23F FY24F YoY Growth % 1 Based on internal Nine estimates 55
Slide 54: Nine Radio
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Slide 55: Talk radio works
TALK RADIO WORKS Live & Local Engaging Intimate Companionship Content Reach and Car, Kitchen Trust and loyalty = frequency of TV powerful marketing People’s Bathroom, Bedroom Ombudsman Instant feedback of social Shed, Gym Reaching ~2m+ weekly listeners 58
Slide 56: Talk radio adds to the Nine portfolio
TALK RADIO ADDS TO THE NINE PORTFOLIO Market Television Radio Publishing Places News & Sport P P P Consistent Demographics 25-54 40-54 P Breakfast & Prime Time Complementary Day Parts Mornings Workday (6pm – 10.30pm) (5.30am – 12pm) Cross-platform talent P P P Advertising/Promotional P P P 59
Slide 57: The restructuring of Nine Radio
THE RESTRUCTURING OF NINE RADIO REVENUE COSTS Growth in audience1 Cost out on consolidation ~$10m 25-54: 28% 35-64: 29% Talent Changes 40-54: 16% Branding of second network ~$8m Growth in revenue share2 (MSR) Syd: 2.3pts; Mel: 4.5pts; Bris: 3.5pts; Per: 1pt Legacy deals (Croc, ATN) ~$15m Opportunity
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Slide 59: Digital & Publishing
DIGITAL & PUBLISHING CHRIS JANZ
Slide 60: Metro Media is evolving into a digital subscription business
METRO MEDIA IS EVOLVING INTO A DIGITAL SUBSCRIPTION BUSINESS Metro Media revenue by category 100% • Reader revenue now exceeds advertising at 90% 24% ~60% of total 80% 34% • Digital recurring revenue is our focus, 70% 16% digital/bundle subs our largest stream: 60% 13% • Doubled in past four years;
Slide 61: Our mastheads reach 12M Australians 14+
OUR MASTHEADS REACH 12M AUSTRALIANS 14+, OF WHICH ONLY 3% ARE SUBSCRIBERS, PRESENTING SIGNIFICANT GROWTH POTENTIAL Readership by Masthead • We have Australia’s two most- The Sydney Morning Herald 1,493 8,803 read mastheads and the leading business publication The Age 1,099 4,517 The Australian • Inc
Slide 62: Converting casual readers to a growing recurring revenue stream
WE ARE FOCUSSED ON CONVERTING CASUAL READERS TO A GROWING RECURRING REVENUE STREAM Grow B2C volume Maximise B2C yield Scale B2B Acquisition momentum: Upsell path: Engagement-driven model: • Content that converts • Premium product • Based on Financial Times • Tightened paywalls • Print bundles (UK) •
Slide 63: Focus on digital subscriber revenue is delivering and growing
OUR FOCUS ON DIGITAL SUBSCRIBER REVENUE IS DELIVERING AND GROWING Quarterly revenue run-rate* Active subscribers** Quarterly revenue run-rate* Active subscribers** $96m in recurring digital subscriptions revenue expected in FY21. 14% annual growth since 2017*** Note: * Index of B2C direct revenue fr
Slide 64: Digital Platforms Code of Conduct expected to deliver upside
THE DIGITAL PLATFORMS CODE OF CONDUCT IS EXPECTED TO DELIVER MATERIAL INCREMENTAL UPSIDE TO METRO MEDIA • Bargaining Code addresses the bargaining imbalance between media businesses and Google and Facebook • Legislation will be introduced to parliament by 10 December • Resulting revenue is projected
Slide 65: Ex Digital Platforms, Metro Media expected to hold earnings
EX DIGITAL PLATFORMS, METRO MEDIA IS EXPECTED TO HOLD EARNINGS AND DELIVER INCREASES IN DIGITAL AND READER REVENUES $m -7% ~40% ~55% Digital; Digital; ~60% ~70% Reader Reader FY20 FY24F Digital Platforms (not to scale) 68
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Slide 67: Marketplaces
MARKETPLACES WUGIA MARKS
Slide 68: Nine operates in some of the largest advertising and subscription segments
NINE OPERATES IN SOME OF THE LARGEST ADVERTISING & SUBSCRIPTION REVENUE SEGMENTS Radio* Magazines $0.9b Newspapers Subscription $0.6b 13% $1.9b TV OOH 16% $2.4b $1.4b FTA $3.5b 31% Traditional TV Nine has a presence $10.8b $5.9b All other* $0.7b 9% Nine has no presence Display Facebook Total Market
Slide 69: Classifieds represent a significant part of the market by value
IN TERMS OF VALUE, CLASSIFIEDS REPRESENT A SIGNIFICANT PART OF THE ADVERTISING & SUBSCRIPTION MARKET Magazines Radio All other OOH Newspapers $0.2b $3.2b $2.3b $0.6b $3.0b Subscription TV Display $3.6b $16.0b Facebook Traditional $12.1b TV display $5.9b FTA $12.9b $2.3b Nine has a presence Cinem a N
Slide 70: Domain Collaboration
DOMAIN COLLABORATION Uda MOWING Domain
Slide 71: Premium content drives our audience, ~13M unique audience IDs
PREMIUM CONTENT DRIVES OUR AUDIENCE ~13M UNIQUE AUDIENCE IDS Unique Audience IDs 104,229 Unique Audience IDs 63% unique to Nine Radio 124,359 55% unique to AFR Unique Audience IDS 8,731,899 82% unique to Nine Unique Audience IDs Unique Audience IDs 709,013 5,830,943 63% unique to 74% unique to Metro
Slide 72: Nine.com.au referrals grew 112% year-on-year
NINE.COM.AU REFERRALS GREW 112% YEAR-ON-YEAR, DRIVING INCREMENTAL AUDIENCE TO DOMAIN Digital Referrals By Month 0.5 0.4 0.3 0.2 0.1 - Nine • Digital referral traffic from nine.com.au has doubled in the last 12 months, from 3.6M to 7.7M (+112%) for FY20. • Continuing with improvements to our editoria
Slide 73: Case study: 33% uplift in new account volumes for Domain Home Loans
CASE STUDY: NINE HAS DRIVEN A 33% UPLIFT IN NEW ACCOUNT VOLUMES FOR DOMAIN HOME LOANS Channel Nine & 9Now Commercial Campaign Q4FY20 campaign period delivered a 47% increase in users and a 33% uplift in new account volumes1 76 1vs monthly average for Q3FY20 and Q1FY21
Slide 74: Case study: Nine's strength in South East Queensland
CASE STUDY: NINE’S STRENGTH IN SOUTH EAST QUEENSLAND CONTRIBUTED TO STRONG CAMPAIGN RESULTS ACROSS ALL METRICS FY20 H1 PERFORMANCE +55% RECORD TOP-OF-MIND BRAND AWARENESS1 +17% WEBSITE VISITS2 +43% VIEWS PER LISTING3 Enquiries3 +37% LEADS PER LISTING4 >20% YIELD PER LISTING5 1. Top-of-mind (TOM) bra
Slide 75: Nine drives audience growth and monetisation for Domain
NINE DRIVES AUDIENCE GROWTH AND MONETISATION FOR DOMAIN’S MARKETPLACE BUSINESSES Television content integration Domain Research House provides property Radio content integration content to Nine, featuring across Australia in Commentary from Domain’s property experts news and current affairs segments
Slide 76: Drive
DRIVE AL BXSAIRSOINS
Slide 77: The market opportunity is compelling
THE MARKET OPPORTUNITY IS COMPELLING FY20 Industry Automotive FY20 Nine Automotive Ad Spend By Advertising Spend (~$2bn) Platform Nine Carsales Other Television & 9Now Radio 9Digital Drive Source: ThinkTV, AdEx, IAB PWC, Carsales Annual Report, Nine Data and Analysis 80
Slide 78: Focussing on high yield opportunities in advertising and leads
FOCUSSING ON HIGH YIELD OPPORTUNITIES IN ADVERTISING AND LEADS Automotive CPMs Opportunities by Platform Programmatic Display (on Nine)* TV 9Now Display (on Drive) Car leads - Used Car leads - New Source: Industry analysis and Nine/Drive internal data 81 *Note: Handheld direct sales only
Slide 79: Nine reaches a significant number of Australians every day
NINE REACHES A SIGNIFICANT NUMBER OF AUSTRALIANS EVERY DAY Nine Television Nine Publishing Drive ~13m signed in users across the Nine Group Reaches ~2m Australians auto Consumers Reaches ~90% of 14+ Australians intenders Reaches ~70% of Australians Data on 2m auto intenders Existing commercial relat
Slide 80: Drive's vision is to create the future of automotive in Australia
DRIVE’S VISION IS TO CREATE THE FUTURE OF AUTOMOTIVE IN AUSTRALIA Commerce Drive enquiry, purchase & retention DEALERS New car deals and offers Find a dealer/test drive/enquire Premium used cars Finance /Insurance MANUFACTURERS Comparison Commentary Drive decision making Drive consideration Compare
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Slide 82: Investing in Growth
INVESTING IN GROWTH VARIA PIIULLIPS
Slide 83: Significant cost initiatives across the business
SIGNIFICANT COST INITIATIVES (NET P&L IMPACT) ACROSS THE BUSINESS1 ~80% IMPLEMENTED TO DATE $m 180 160 Includes est. annualised savings and cost initiatives 140 that manifest in revenue 120 100 80 60 40 20 0 FY20 FY21E FY22/23F FY20 FY21E FY22/23F FY20 FY21E FY22/23F Television Radio Publishing Cycl
Slide 84: Majority of structural cost out from programming, production and distribution
WITH THE MAJORITY OF THE STRUCTURAL COST OUT COMING FROM PROGRAMMING, PRODUCTION & DISTRIBUTION FY22/23F Structural Cost Out (excl. Cyclical)2 Programming NRL Production & Distribution Revenue Sales Other 1 Based from FY19, cumulative net cost out 2 Starting point for Television adjusted by pre COVI
Slide 85: Reduced costs in traditional businesses, reinvested in digital
WE HAVE REDUCED COSTS IN OUR TRADITIONAL BUSINESSES, AND REINVESTED IN OUR DIGITAL BUSINESSES Group Costs By Business ~45% of total ~77% of total FY18 FY20 FY24F Traditional Businesses Digital Businesses 1 Traditional businesses include FTA, Radio and the non-digital parts of Metro Media 2 Digital b
Slide 86: Large portion of reinvestment allocated to content spend
WITH A LARGE PORTION OF THIS REINVESTMENT TO BE ALLOCATED TO CONTENT SPEND Costs By Type – Digital Businesses1 50% 65% Reinvestment in content 50% 35% across digital businesses FY20 FY24F Content spend Other spend 1 Includes 9Now, 9Digital, Stan & Digital parts of Metro Media 89
Slide 87: Margins are expected to continue to grow
MARGINS ARE EXPECTED TO CONTINUE TO GROW AS OUR DIGITAL TRANSFORMATION ACCELERATES Nine EBITDA Margin % FY19 FY20 FY21E FY22F FY23F FY24F 1 Excludes Domain 90
Slide 88: Three key areas of focus
THREE KEY AREAS OF FOCUS THE NEXT PHASE OF OUR STRATEGY IS INTEGRATION AND OPTIMISATION Operational Excellence Data & Analytics Margin Optimisation Drive transformation of Enhance strategic thinking Focus on monetisation of enterprise systems and and decision making content cross-platform to process
Slide 89: Close
CLOSE WUGIA MARKS
Slide 90: In the short term
IN THE SHORT TERM RELATIVE AD MARKETS COST BASE CONTINUED PERFORMANCE RECOVERING RESTRUCTURED GROWTH STRONG CLEAR SIGNS IN ACROSS ALL FTA, METRO FROM STAN, 9NOW, BVOD, FTA BUSINESSES MEDIA, RADIO DIGITAL SUBSCRIPTIONS 93
Slide 91: By FY24, Nine is focussed on achieving
BY FY24, NINE IS FOCUSSED ON ACHIEVING ~$230M ~60%+ >35% ~30% STRUCTURAL (P&L) OF EBITDA1 FROM OF GROUP OF NINE’S COST OUT FROM DIGITAL REVENUES FROM REVENUE FROM FY19 (NET BUSINESSES SUBSCRIPTION1 VOD ACROSS FTA, RADIO AND PUBLISHING) 1 All Domain Digital revenue included as subscription revenue 94
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Nine Entertainment Co. Holdings — Investor Day (November 2020) on 6ix