Reach Plc · LSE:RCH

Reach — Trinity Mirror — Merger or Acquisition (February 2018)

16 slides from Reach's merger presentation, Feb 9, 2018

  1. Slide 1: Proposed acquisition of Northern & Shell's publishing assets

    Proposed acquisition of Northern & Shell’s publishing assets 9 February 2018 Trinity Mirror plc

  2. Slide 2: Disclaimer

    Disclaimer THIS PRESENTATION AND ITS CONTENTS (INCLUDING ANY ORAL REPRESENTATION AND QUESTION AND ANSWER SESSION) (THE PRESENTATION) IS CONFIDENTIAL AND IS BEING PROVIDED TO YOU SOLELY FOR YOUR INFORMATION AND MAY NOT BE REPRODUCED OR REDISTRIBUTED (IN WHOLE OR IN PART) TO ANY OTHER PERSON FOR ANY P

  3. Slide 3: Disclaimer (cont'd)

    Disclaimer (cont’d) This presentation and any materials distributed in connection with this presentation are not directed at, or intended for distribution to or use by, any person or entity that is a citizen or resident of, or located in, any locality, state, country or other jurisdiction where such

  4. Slide 4: Trinity Mirror current trading and prospects

    Trinity Mirror current trading and prospects  Adjusted(1) results for 2017 to be marginally ahead of consensus forecasts(2)  Group revenue for 2017 on a LFL basis(3) is expected to fall by 9% YoY (in line with the first half)  Expect to propose a final dividend of 3.55p per share for 2017 – Toget

  5. Slide 5: Consolidation is a core pillar of Trinity Mirror's strategy

    Consolidation is a core pillar of Trinity Mirror’s strategy GROW Why consolidation? BUILD OUR STRATEGY In a structurally challenged industry, PROTECT consolidation enables significant cost synergies to be delivered whilst simultaneously improving the proposition for readers and advertisers. CONSOLID

  6. Slide 6: Why Northern & Shell's publishing assets?

    Why Northern & Shell’s publishing assets? Northern & Shell’s publishing assets are a perfect fit with Trinity Mirror Monthly Monthly  The business is of a scale to make a material Circ(2) UBs(2) PVs(2) difference to Trinity Mirror’s future cash flows and financial performance 365k – 2017 Adjusted E

  7. Slide 7: We believe the proposed acquisition is good for all stakeholders

    We believe the proposed acquisition is good for all stakeholders Shareholders  Financially compelling opportunity delivering attractive returns to shareholders  Materially earnings enhancing in the first full year following the acquisition Readers  Improved breadth of editorial coverage from larg

  8. Slide 8: Proposed deal structure

    Proposed deal structure Ensures leverage is maintained below 1x  An upfront payment of £41.2 million will also be made to the Initial cash N&S Pension Schemes and a new recovery plan to 2027 with £47.7m(1) consideration total payments of £29.2 million over the recovery plan  Cash consideration fun

  9. Slide 9: The proposed acquisition is financially compelling

    The proposed acquisition is financially compelling …and will deliver attractive returns to shareholders  More robust revenue mix – N&S circulation revenue was £116m in 2016 representing 61% of total revenue – Less reliance on print advertising  Significant potential for synergies – Expected to del

  10. Slide 10: Expected timetable

    Expected timetable Following Announcement of the acquisition at 7:00am on 9 February:  Post shareholder circular: 9 February  General Meeting: 27 February  Completion of the UK acquisition: 28 February  Year end announcement: 5 March  Completion of the Irish acquisitions: later in 2018 (followi

  11. Slide 11: Thank you

    THANK YOU Questions Trinity Mirror plc

  12. Slide 12: Appendices

    Appendices

  13. Slide 13: Northern & Shell's publishing assets financials

    Appendix 1 Northern & Shell’s publishing assets financials Financial highlights 2016 revenue split £m 2016A 2017E Circulation 116.3 2% Advertising 52.0 Digital - display and transactional 12.6 7% 3% Circulation Printing 3.1 Advertising Other 6.3 27% Digital Total revenue(1) 190.3 Marginally ahead 61

  14. Slide 14: Pensions

    Appendix 2 Pensions IAS 19 Accounting Assets(1) Liabilities(1) Deficit (1) Last Triennial £m IAS19 IAS19 IAS19 Valuation (3) Northern & Shell Schemes 753.1 (784.4) (31.3)(2) (63.6) Trinity Mirror Schemes 1,551.6 (1,929.2) (377.6) (622.2) Total 2,304.7 (2,713.6) (408.9) (685.8)  Northern & Shell Pen

  15. Slide 15: Key terms of the acquisition

    Appendix 3 Key terms of the acquisition Consideration settled by £m £m New TM equity issued 20.0 Cash for N&S Network Limited 42.7 Cash for 50% of Irish JV (Independent Star Limited) 4.5 Cash for "Direct Sales Acquisition" International Distribution 2018 Limited 0.5 Deferred cash for N&S Network Lim

  16. Slide 16: Synergies and integration plan

    Appendix 4 Synergies and integration plan Anticipated cost savings £m 2020 Content generation 9.3 Cost of advertising sales 4.3 Digital and technology costs 2.1 Printing and distribution 3.3 Management and central costs 1.0 Total cost savings 20.0 One-off implementation costs £m Opex 16.0 Capex 4.0

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