STV Group plc · LSE:STVG
STV — H1 2012 Earnings Presentation
28 slides from STV's earnings presentation, 2012
Slide 1: STV Player – Richard Findlay, Chairman
CORONATION STREE
Slide 2: Slide 2
Slide 3: Strong financial performance
Strong financial performance • Good progress towards achievement of 2015 aims - KPIs on track (two ahead and two below) • New Channel 3 Network affiliate arrangements • Digital business growth continues with 13% increase in revenue • STV Productions growing • Bidding made to secure local television
Slide 4: George Watt, Chief Financial Officer
George Watt CHIEF FINANGIAL OFFICER
Slide 5: Financial results – pre exceptionals
Financial results – pre exceptionals H1 2012 H1 2011 Turnover £47.6m £47.2m +1% EBITDA £9.3m £8.1m +15% Operating profit £8.1m £7.0m +16% Interest Cost £1.1m £0.5m +120% Pre-tax profit £7.0m £6.5m +8% EPS 16.0p 17.7p -10% EPS – equivalent tax rate 16.0p 15.0p +7% Tax Rate 15% 0% Net Debt £55.9m £57.
Slide 6: Turnover – STV continuing
Turnover – STV continuing £m H1 2012 H1 2011 Consumer - National Airtime 33.2 33.7 -1% - Regional Airtime 6.4 6.2 +3% - Sponsorship 1.7 1.7 - - Digital 3.0 2.7 +13% - Other 0.8 0.8 - 45.1 45.0 - Productions 2.5 2.2 +14% Total 47.6 47.2 +1%
Slide 7: Operating profit – pre-exceptionals
Operating profit – pre-exceptionals Operating Profit Operating Margins H1 2012 H1 2011 H1 2012 H1 2011 £m £m Consumer 9.6 8.2 21.3% 18.2% Productions (1.5) (1.2) (60.0%) (54.5%) Total 8.1 7.0 17.0% 14.8%
Slide 8: Digital profit & loss account
Digital profit & loss account £m H1 2012 H1 2011 Turnover 3.0 2.7 +13% Costs (2.0) (2.7) (26%) Margin 1.0 - n/a 33% 0% • 13% revenue growth - Increased page views - Increased video stream views • Steady investment in STV Local and revenues beginning to flow
Slide 9: Exceptional items
Exceptional items £m H1 2012 H1 2011 Cash – litigation costs - 3.5 – settlement impact 0.8 9.5 0.8 13.0 Non cash – new ITV arrangements stock impact 4.1 - Pre Tax total 4.9 13.0 Tax (0.9) - Post Tax total 4.0 13.0
Slide 10: Cashflow
Cashflow £m H1 2012 H1 2011 Operating Profit 8.1 7.0 Non-cash Items 1.2 1.1 EBITDA 9.3 8.1 Working Capital Movements 4.5 1.7 Capex (0.7) (0.6) Operating Cashflow 13.1 9.2 Litigation settlement & costs (9.8) (9.6) Cost of change costs (0.9) (0.9) Pension deficit payments (2.1) (4.2) Interest paid (1.
Slide 11: Pensions - Overview
Pensions - Overview June 2012 Dec 2011 June 2011 Liabilities £297m £295m £277m Assets £267m £264m £264m Deficit - gross £30m £31m £13m - net £23m £23m £9m Discount Rate Inflation June 2012 4.85% 2.8% December 2011 4.95% 3.3% June 2011 5.65% 3.4% • £2.1m of 2012 pension deficit payment total of £4.2m
Slide 12: Consumer KPIs
Consumer KPIs 1. Peak time audience v ITV Network – aim to exceed in all years 2011 Actual +0.85 pts 2010 Actual +0.24 pts Tracking ahead 2. Increase consumer division margin (%) 16.5 17.0 16.0 15.5 15.5 14.1 10.1 On track 2009 2010 2011 2012 2013 2014 2015 3. Consumer Insights – million 2.4 1.8 1.2
Slide 13: Consumer KPIs (continued)
Consumer KPIs (continued) 4. Monthly unique users (Q4 ave) - million 3 .6 3 .7 3 .5 3 .3 3 .0 2 .2 On track 1.3 2009 2 0 10 2 0 11 2 0 12 2 0 13 2 0 14 2 0 15 5. Monthly page impressions (Q4 ave) - million 25.5 24.0 22.0 20.0 17.0 11.0 Tracking ahead 4.8 2009 2010 2011 2012 2013 2014 2015 6. Monthly
Slide 14: Consumer KPIs (continued)
Consumer KPIs (continued) 7. Digital revenue (£m) 17.0 14.1 11.3 9.1 7.1 Tracking below 4.2 2.8 2009 2010 2011 2012 2013 2014 2015 8. Digital margin (%) 35.0 35.0 25.0 20.0 16 17.0 On track nil Actual 2009 2010 2011 2012 2013 2014 2015 Target
Slide 15: Production KPIs
Production KPIs 9. Grow produced hours 170 160 150 140 113 121 On track 90 2009 2010 2011 2012 2013 2014 2015 10. Production revenues 22.0 18.0 15.0 9.8 12.0 On track 8.1 8.4 2009 2010 2011 2012 2013 2014 2015 Actual Target 11. Productions margin – exceed 10% minimum in all years 2011 Actual 6.0% 20
Slide 16: Rob Woodware, Chief Executive Officer
Rob Woodware CHIEF EXECUTIVE OFFICER
Slide 17: Operational priorities for 2012
Operational priorities for 2012 ITV Develop strong consumer relationships Productions Digital Continued growth Engagement and across genres development of new services
Slide 18: Innovation at STV: Creating value and growth
Innovation at STV Creating value and growth • Delivering innovative public service content across platforms • Enhancing digital delivery of consumer services • Connecting brands with consumers • Building communities of interest • Creating and delivering compelling content •
Slide 19: Delivering innovative public service content
Innovation at STV Delivering innovative public service content • The home of breaking news • Pioneering technology to deliver news • Non-linear public service content accessed by 40% of broadcast news audience • Success of daily current affairs programme, Scotland Tonight • Delivered highest ratings
Slide 20: Connecting brands with consumers
Innovation at STV Connecting brands with consumers Unique promotion of Brave in Scotland for Disney • STV assets used - TV Ads - Themed sponsor bumpers - VoD ads - Online and mobile - One and two minute ad funded programmes - Product Placement STV is successfully using our solutions to bring digital
Slide 21: Connecting brands with consumers
Innovation at STV [Innovative approach to channel sponsorship] Connecting brands with consumers Delivering results for leading brands • Sponsorship of all STV channels and platforms to promote new product launch • 46% of Scots saw promotional bumpers on screen • 59% of Sun readers saw the spot adver
Slide 22: Enhancing digital delivery of consumer services
Innovation at STV Enhancing digital delivery of consumer services • Page impressions grown 40% year on year • Non-linear audience now 67% of broadcast audience • Providing free access across all platforms - Secured Channel 3 position on YouView in Scotland from launch - STV and Sky selected from We’
Slide 23: Connecting with communities
Innovation at STV Connecting with communities • Launch of metro sites for Glasgow and Edinburgh • Plan to launch metro sites in Aberdeen and Dundee • Bidding to secure local TV licences for Edinburgh and Glasgow • Created ScotPulse – Once groups see the benefit of Scotland’s largest online STV Local
Slide 24: Creating compelling content
Innovation at STV Creating compelling content • New commission for BBC2 for delivery in H2 (20 episodes of daytime cookery show) • Two-year deal for hit series Antiques Road Trip for the BBC (120 episodes) Antiques Road Trip and the celebrity version have been ratings success stories. It’s great to
Slide 25: Creating compelling content
Innovation at STV CreatingCompelling Creating compellingcontent content • Innovation in content funding models to invest in international formats and production • Strong and growing partnership with GroupM Entertainment Our partnership with STV created the opportunity for this innovative deal, which
Slide 26: Our strategic aims
Our strategic aims By 2015: • Grow non-broadcast earnings to represent 33% of Group earnings; • To double STV Productions’ revenues; • Be the most used digital service in Scotland; • Launch two new market-leading digital consumer propositions • Maintain our position as the voice of Scotland An ambit
Slide 27: On track to delivering our 2015 goals
On track to delivering our 2015 goals • Strong results and good progress towards 2015 goals • Strong delivery against KPIs • New Channel 3 Networking Arrangements in place and approved • Double digit growth in digital businesses • New series commission for STV Productions • Bidding for local TV lice
Slide 28: Coronation Street
—_ 5 7 CORONATION