Slide 1: Management Presentation and Fourth Quarter 2015 Financial Results
‘Time Inc.“ P ; ) Bg Management Presentation and Fourth Quarter 2015 @ Financial Results Ce ae FEBRUARY 11, 2016
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1985 particulary statements regarding future financial and operating results of Time Inc. (the “Company”) and its business. these factors may be found in the Company
Slide 3: Time Inc. is all about creating powerful engagements with consumers and advertisers
Time Inc. is all about creating powerful engagements with consumers and advertisers. We are the leading content company and the preferred destination for people who crave storytelling that is genuine, compelling and impossible to forget. At Time Inc. we embrace all forms of content from investigativ
Slide 4: Time Inc. delivers our content through multiple voices and lenses
Time Inc. delivers our content through multiple voices and lenses across every audience segment. Social media and the consumption of content on mobile platforms are allowing us to reach larger audiences than ever before - 120 million in print, over 150 million across desktop and mobile, and 189 mill
Slide 5: Each new wave of technology creates extraordinary new opportunities
Each new wave of technology creates extraordinary new opportunities. Technology allows us to more effectively target a . consumers; and it provides better opportunities to expand our storytelling capabilities and have more it emotional with curren and future audiences. 7 In this world, trusted brand
Slide 6: Trust, deep engagement and emotional experiences are what Time Inc. offers
Trust, deep engagement and emotional experiences are what Time Inc. offers consumers and advertisers. Our diverse portfolio of brands, which sit across all platforms, allows us to touch audiences with the right content at the right time. We engage audiences with trusted, inspiring and moving storyte
Slide 7: How are we transforming Time Inc.
How are we transforming Time Inc. to assure continued deep engagement with consumers and advertisers—giving them what they want, when and where they want it?
Slide 8: The North Star of Time Inc. is rebuilding the company for revenue growth
The North Star of Time Inc. is rebuilding the company for revenue growth. We currently estimate that the company will achieve revenue crossover in 2016.
Slide 9: Pillars of Revenue Crossover
Pillars of Revenue Crosso S . Configuring Our Team for Leadership in the ae RY . New Experiences Current Media Environment Using our Authority to Build Digital Properties that Maximize the Benefits of our Scale Better Targeting & Customization with Data Branded Content & Native Solutions Video
Slide 10: Configuring Our Team for Leadership in the Current Media Environment
Configuring Our Team for Leadership in the Current Media Environment Time Inc. is becoming a talent magnet that attracts and retains the best and brightest. We are building on a core of excellence. We are adding capabilities to position us for our return to growth including video, native content, so
Slide 11: Using our Authority to Build Digital Properties
Using our Authority to Build Digital Properties = that Maximize the Benefits of our Scale Great storytelling works very well on desktop, mobile and social platforms. Something really special has been happening at Time Inc. Over the past two years, we've increased our monthly domestic unique visitors
Slide 12: Better Targeting & Customization with Data
Better Targeting & Customization with Data Media companies need a roadmap to target individuals and customize content experiences and marketing messages. In 2015, ery strong growth of revenues. We ‘began making investments aude hiring a team of data scientists to position us to continue to benefit f
Slide 13: Branded Content & Native Solutions
Branded Content & Native Solutions CMOs increasingly want to create content for their brands that engages their target audiences, and helps them to break through the clutter. New Cars This is a natural extension for us given that Time Inc. is all about creating powerful engagements with consumers an
Slide 14: Time Inc's brands translate very well into sight, sound and motion
Time Inc’s brands translate very well into sight, sound and motion. With TV audiences fragmenting and rapidly declining, we believe the TV eco-system has broken wide open, and we are already participating in this disruption as advertisers shift dollars into digital video and over-the-top (OTT) offer
Slide 15: New Experiences
New Experiences One of the unique characteristics of our portfolio is our ability to extend our brands, content and audiences to New Experiences. Time Inc’s p ppt million in lized run-rate basis, and should be several hundred million dollars by 2019. Time nc. is currently a big player in Live Media
Slide 16: Fourth Quarter 2015 Financial Results
Fourth Quarter 2015 Financial Results Jeff Bairstow
Slide 17: Financial Highlights
Financial Highlights 4Q15 revenue trends improved sequentially across advertising, circulation and other. Currently projecting Time Inc. will achieve consolidated revenue cross-over in 2016. Positive results from 2015 portfolio of growth ini acquisitions. Revenué running ahead of expectations in the
Slide 18: December 2015 total U.S. unique visitors totaled 119 million
1 Source: comScore December 2015. December 2015 total U.S. unique visitors to our U.S. sites totaled 119 million.
Slide 19: 4Q15 Circulation Revenues
4Q15 Circulation Revenues I Other Circulation Revenues HIGHLIGHTS Il Newsstand Revenues an = Subscription revenues down 3% $288 $278 . d 9 =a ~ Newsstand revenues down 6% People magazine achieved its highest annual market share of the celebrity newsstand category
Slide 20: 4Q15 Other Revenues
4Q15 Other Revenues HIGHLIGHTS Pl $115 Other revenues up 4% 2015 acquisitions that impacted Other Revenues included our new youth sports platform (GI Play), plus the expansion of our events capabilities with inVNT, and our craft and cycling events acquisitions in the U.K.
Slide 21: 4Q15 Operating Expenses
4Q15 Operating Expenses HIGHLIGHTS $MM '™ Costs of Revenues (COR) GBA = Costs of Revenues up 2% $693 $723 = SG&A up 6% $332 ® Costs of revenues and SG&A combined increased 4% Includes $11 million of incremental real estate related expenses, plus ~400 basis points related to our growth initiatives an
Slide 22: Adjusted OIBDA and Adjusted Diluted EPS definitions
1 We define Adjusted OIBDA as OIBDA adjusted for impairments of Goodwill; intangibles; fixed assets and investment; Restructuring and severance costs; gains and losses on operating assets; pension plan settlements and/or curtailments; and Other costs related to mergers, acquisitions, investments and
Slide 23: 4Q15 Cash Update
4Q15 Cash Update ® 2015 ending cash of $711 million = $623 million net proceeds from the sale of Blue Fin Building = Quarterly dividend of $0.19 per share, or $21 million, paid on 12/15/15 = $75 million face value of debt purchased at a discount for $72 million (excluding accrued interest) = Stock b
Slide 24: Adjusted OIBDA definition and 2015 capital expenditure note
1 We define Adjusted OIBDA as OIBDA adjusted for impairments of Goodwill; intangibles; fixed assets and investment; Restructuring and severance costs; gains and losses on operating assets; pension plan settlements and/or curtailments; and Other costs related to mergers, acquisitions, investments and
Slide 25: Q&A
Q&A
Slide 26: Appendix
Appendix
Slide 27: Schedule I
Schedule | TIME INC. (Unaudited; in millions) Three Months Ended Year Ended December 31, December 31, 2014 2014 Operating income (loss) $ 0 § 2s $ (e23) $ 180 Depreciation 23 24 92 101 ‘Amortization of intangible assets 20 20 80 78 180A” 53 259 (651) 359 \sset impairments - 26 Goodwill impairment -
Slide 28: Schedule II
Schedule It TIME INC. INCOME (LOSS) INCOME (Unaudited; in millions) Three Monta Ended “Tree Month nde December 31,2015 December 34,2018 “cro ingot Taxtmonct Netimpact ‘ros impact Jeutmees. Nevimpec. Net income (oss) 5 oF 3 wv S rary = Ms [Adjusted Net income {Loss} i a oe i ct Year tnded Year Ended
Slide 29: Schedule III
TIME INC. (Unaudited; all per share amounts are net of tax) Schedule It Three Months Ended Year Ended ember 3: December 31, 2015 2014 2015 2014 Diluted EPS - 015 $ 1.32 (8.32) $ 0.80 Asset impairments - - - 01s Goodwill impairment 0.02 8.84 0.26 Restructuring and severance costs 1.00 0.4 112 1.10 en
Slide 30: Schedule IV
Schedule IV TIME INC. (Unaudited; in millions) Three Months Ended Year Ended December 31, December 31, 2015 2014 2015 2014 Cash provided by (used in) operations $ 27 $ i$ 154 $ 281 Less: Capital expenditures (80) (11) (212) (41) (53) 100 (58) 240 Free Cash Flow!)
Slide 31: 2016 Outlook
TIME INC. (Unaudited; in millions) 2016 Outlook 2015 Actual Low Operating income (loss) $ (823) $ 305 $ Depreciation 92 60 Amortization of intangible assets 80 75 BDA $ (651) $ 440 $ Ne it 1,091 = ‘Adjusted OIBDA® 440 440
Slide 32: Time Inc.
‘Time Inc.“ P ; ) Bg Management Presentation and Fourth Quarter 2015 @ Financial Results Ce ae FEBRUARY 11, 2016