Southern Cross Media Group Limited · ASX:SXL
Southern Cross Media — Southern Cross Austereo — FY2013 Earnings Presentation
32 slides from Southern Cross Media's earnings presentation, Aug 14, 2013
Slide 1: Southern Cross Austereo FY13 Investor Presentation
For personal use only SOUTHERN CROSS AUSTEREO FY13 INVESTOR PRESENTATION 14 AUGUST 2013
Slide 2: Headlines
For personal use only HEADLINES RHYS HOLLERAN, CEO
Slide 3: Headline Achievements
3 HEADLINE ACHIEVEMENTS For personal use only • FY result – both reported and underlying – in line with previous guidance • Reported NPAT $96m – Underlying NPAT $91m • Net Debt $600m – Leverage Ratio of borrowing Group 2.67 times • Despite revenue reduction EPS maintained at 13.6 cents per share • D
Slide 4: Headline Achievements: Continued Radio ratings success
4 HEADLINE ACHIEVEMENTS For personal use only Continued Radio ratings success • #1 and #2 FM breakfast shows in Melbourne1 • #1 FM breakfast shows in Sydney, Perth, Gold Coast, Newcastle1 • Triple M Rock, Sport and Comedy format continuing to attract greater audience improving 1 share point year on
Slide 5: Headline Achievements: Online & Social Media Footprint
5 HEADLINE ACHIEVEMENTS For personal use only Largest Online & Social Media Footprint SCA Digital Presence • SCA’s Group wide Facebook community ranks • 1.3m smartphone app downloads4 in the top three in the ASX 2001 • 52% growth in Facebook Community5 • #12 Australian daily publisher via mobile bro
Slide 6: Headline Achievements: Songl
6 HEADLINE ACHIEVEMENTS For personal use only • Songl launched in April 2013 • Has grown rapidly to over 35,000 registrants since launch • Partnered with Nine Entertainment across multiple platforms – i.e. integration with Big Brother
Slide 7: FY13 Financial Analysis
For personal use only FY13 FINANCIAL ANALYSIS STEPHEN KELLY, CFO
Slide 8: Group Reported Results
8 GROUP REPORTED RESULTS For personal use only $ millions FY13 FY12 % Variance Revenue 642.7 687.3 (6.5%) Expenses (441.5) (460.8) (4.2%) Equity Accounted Profit (0.7) (0.7) Profit on sale of Sunshine Coast radio 10.4 - EBITDA 210.9 225.8 (6.6%) Depreciation & Amortisation (26.5) (30.5) (13.1%) EBIT
Slide 9: Group Underlying Results
9 GROUP UNDERLYING RESULTS For personal use only $ millions Reported Adjustments1 Underlying Underlying2 % Variance FY13 FY13 FY12 Revenue 642.7 7.8 650.5 687.3 (5.4%) Expenses (441.5) (0.3) (441.8) (458.7) (3.7%) Equity Accounted Profit (0.7) - (0.7) (0.7) Profit on sale of Sunshine Coast Radio 10.
Slide 10: Metro Underlying Results Comparative
10 METRO UNDERLYING RESULTS COMPARATIVE For personal use only $ millions FY13 FY12 % Variance Revenue 267.8 273.6 (2.1%) Broadcast & Production (23.3) (23.2) 0.4% Employee (91.3) (91.5) (0.2%) Selling, General & Administration (63.9) (60.1) 6.3% Total Expenses (178.5) (174.8) 2.1% EBITDA 89.3 98.8 (
Slide 11: Regional Underlying Results Comparative
11 REGIONAL UNDERLYING RESULTS COMPARATIVE $ millions FY13 FY121 % Variance For personal use only TV 214.4 246.1 (12.9%) Radio 168.3 167.6 0.4% Total Revenue 382.7 413.7 (7.5%) Broadcast & Production (82.1) (92.2) (11.0%) Employee (83.3) (83.3) - Selling, General & Administration (97.9) (108.4) (9.7
Slide 12: Revenue Analysis
12 REVENUE ANALYSIS 400.0 Total Revenue by Channel ($ m’s) For personal use only 350.0 85.4 85.6 300.0 80.6 84.1 82.0 81.7 250.0 141.4 133.8 200.0 125.2 111.3 112.3 103.1 150.0 100.0 145.7 136.8 143.2 130.4 134.5 128.0 50.0 0.0 H1 FY11 H2 FY11 H1 FY12 H2 FY12 H1 FY13 H2 FY13 Regional Radio Regional
Slide 13: Advertising Revenue Analysis
13 ADVERTISING REVENUE ANALYSIS FY13 FY12 FY11 For personal use only National Revenues $317.2m National Revenues $356.8m National Revenues $371.0m 43.7 45.5 40.3 National - Metro Radio National - TV 177.3 185.2 164.8 108.7 134.0 145.5 National - Regional Radio Local Revenues $262.9m Local Revenues $
Slide 14: TV Share
14 TV SHARE SC Ten – Share Analysis1 For personal use only 26.0% 25.3% 24.6% 23.4% 23.4% 23.7% 23.2% 21.7% 21.5% 19.8% 20.1% 19.5% H1 FY11 H2 FY11 H1 FY12 H2 FY12 H1 FY13 H2 FY13 Commercial Share Audience Share • Power ratio of < 1 reflecting lag in effect of National sales cycle. • Gap expected to
Slide 15: Metro Radio Commercial Share
15 METRO RADIO COMMERCIAL SHARE For personal use only Market Market ($m’s) (m's) 100.0% 182 190,000 180 180 179 90.0% 174 175 173 174 180,000 80.0% 167 170,000 70.0% 155 156 154 160,000 60.0% Kyle Incident UK Incident 150,000 50.0% 37.7% 38.7% 38.5% 38.0% 37.0% 37.1% 36.6% 140,000 40.0% 35.5% 34.6%
Slide 16: Debt Facilities
16 DEBT FACILITIES For personal use only $ millions June 2013 Dec 2012 Drawn Debt 703.0 713.0 Less Cash (102.9) (83.8) Net Debt (Group) 600.1 629.2 Net Debt (Borrowing Group) 606.5 635.6 • Current debt facility matures March 2015. • Refinancing expected to be completed by 30 June 2014.
Slide 17: Debt Facility Covenants
17 DEBT FACILITY COVENANTS Leverage Ratio & Net Debt Interest Cover For personal use only 5 4.5 4.63 4.25 4.08 4.13 4 4.0 3.6 3.6 3.6 3.6 3.6 3.5 2.96 2.86 3 2.75 2.9 2.9 2.9 2.9 2.9 2.62 2.67 2.5 June 2011 Dec 2011 June 2012 Dec 2012 June 2013 June 2011 Dec 2011 June 2012 Dec 2012 June 2013 Leverag
Slide 18: Cash Flow
18 CASH FLOW For personal use only $ millions Opening Cash 97.2 Cash From Operations (pre tax) 192.0 Proceeds from sale of Land & Buildings 1.8 Interest, Derivative & Borrowing Cost payments (57.7) Tax (38.7) Capital expenditure (25.1) Payments for investments and intangibles (1.3) Proceeds from sal
Slide 19: EPS Analysis
19 EPS ANALYSIS For personal use only Cents per share FY13 FY12 Underlying Operations 12.9 14.2 One Off Costs (0.7) (0.6) Profit on Sale of Radio Licences 1.5 Sunshine Coast – 4 months normalisation (0.1) One Off Tax Benefit 5.6 Tax on Amended Assessment (4.6) Interest on Amended Assessment (net of
Slide 20: Operational Update
For personal use only OPERATIONAL UPDATE RHYS HOLLERAN, CEO
Slide 21: The Year in Review
21 THE YEAR IN REVIEW For personal use only • Revenue down overall 5.4% - 87% due to our Television business – TEN commercial share of 4 Agg markets fell to 19.5% – On-air incidents have impacted Metro radio share – Regional Radio outperformed metro markets on the back of a good local result – A hig
Slide 22: The Year in Review
22 THE YEAR IN REVIEW For personal use only • We remain dominant in the key radio demographics of 18-39 and 25-54 • National Sales is under new leadership with Andrea Ingham – ex Nine – commencing in February as our National Sales Director. Andrea has had an immediate positive impact on improving ou
Slide 23: The Year in Review
23 THE YEAR IN REVIEW For personal use only • Digital developments include:- – Launch of Songl and partnering with Nine Entertainment on the development of the subscriber base – Continuing development and growth of DAB+ as a point of engagement – Many more integrated campaigns for our clients such a
Slide 24: Community
24 COMMUNITY For personal use only • Give Me 5 For Kids raised over $2.3 million in July 2013 and over $10 million since inception with all donations going to local hospitals • I Believe in Christmas, in partnership with the Salvation Army, donated over 22,000 toys to children in need in December 20
Slide 25: What's Ahead
25 WHAT’S AHEAD For personal use only • We are positive about the new direction being taken at TEN which should yield improvement in audience numbers and revenue share over the next three years • Investment in our Metro Radio content is expected to see further improvements in ratings and sales share
Slide 26: What's Ahead
26 WHAT’S AHEAD For personal use only • On-line and Social Media will be utilised to further enhance our engagement with our fans – New environments will continue to build “fans not listeners” • Regulatory Environment – 75% Reach Rule: we maintain our view this should be abolished in a modern media
Slide 27: What's Ahead
27 WHAT’S AHEAD For personal use only • A further review of our business has commenced and is expected to result in further enhancements to our operating model over the coming few years. • Q1 trading thus far has been satisfactory and met our expectations. • It is difficult to predict markets at pre
Slide 28: Questions
For personal use only QUESTIONS
Slide 29: Appendices
For personal use only APPENDICES
Slide 30: Adjustment to Underlying Results
30 ADJUSTMENT TO UNDERLYING RESULTS For personal use only $ millions Reported Impact of One Sunshine Coast Underlying FY13 FY13 Off Events Normalisation Revenue 642.7 5.3 2.5 650.5 Expenses (441.5) 1.3 (1.6) (441.8) Equity Accounted Profit (0.7) - - (0.7) Profit from discontinued ops. 10.4 (10.4) -
Slide 31: Metro Ratings (18-39)
METRO RATINGS (18-39) For personal use only 31 30% 25% 20% 15% 10% 5% 0% Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey #5 #6 #7 #8 #1 #2 #3 #4 #5 #6 #7 #8 #1 #2 #3 #4 #5 #6 #7 #8
Slide 32: Metro Ratings (25-54)
METRO RATINGS (25-54) For personal use only 32 30% 25% 20% 15% 10% 5% 0% Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey Survey #5 #6 #7 #8 #1 #2 #3 #4 #5 #6 #7 #8 #1 #2 #3 #4 #5 #6 #7 #8
Southern Cross Austereo — FY2013 Earnings Presentation on 6ix