Goldman Sachs and Gao Hua China Investment Frontier Conference 2011 1
Forward- -looking statements looking statements Forward This presentation and subsequent discussion may This presentation and subsequent discussion may contain certain forward- -looking statements with respect looking statements with respect contain certain forward to the financial condition, results of operations and to the financial condition, results of operations and business of Clear Media. These forward- -looking looking business of Clear Media. These forward statements represent Clear Media’ ’s expectations or s expectations or statements represent Clear Media beliefs concerning future events and involving known beliefs concerning future events and involving known and unknown risks and uncertainties which could cause and unknown risks and uncertainties which could cause actual results, performance or events to differ materially actual results, performance or events to differ materially from those expressed or implied in such statements. from those expressed or implied in such statements. 2
Integrating the World’s Best Practice CLEARCHANNEL CLEARCHANNEL WORLDWIDE WORLDWIDE � World's leading out � World's leading out - - of of- - home media/ home media/ entertainment company entertainment company � CCO: � CCO: World World’ ’s largest outdoor advertiser s largest outdoor advertiser NYSE listed NYSE listed 3
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Our 13 Years Track Record 1400 Turnover (HK$’m) 1200 1000 800 1,260 1,262 600 1,118 997 400 776 691 675 538 488 427 200 355 260 170 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 * 5 *For six months ended 30 June 2011
Take Control of Outdoor 36% 36% Media Mix Media Mix 27% 27% 13% 13% 12% 12% 7% 7% 5% 5% TV Newspaper/ TV Newspaper/ Internet Internet Outdoor Radio Others Outdoor Radio Others Magazine Magazine 6 Data Source: SAIC 2010, Company estimates
Leader in China’s Outdoor Advertising � Standardized � Standardized m m edia edia n network etwork � 28 � 28- - city city n national ational c coverage overage � # 1 � # 1 in all in all k key cities ey cities Regional Sales Center Sales Center Regional 7
Mass Medium of Choice “ Standardized Standardized” ” Network Network “ � Low cost � Low cost - - per per- - thousand thousand � Highly visible � Highly visible – – “ “ always on always on” ” � Only sector opens to foreign investors � Only sector opens to foreign investors � Growing outdoor audience � Growing outdoor audience 8
Secure Long Term Supply � National MOFCOM & SAIC � National MOFCOM & SAIC a approvals pprovals � Long � Long- - term term c contracts w/ local governments ontracts w/ local governments � Exclusive & � Exclusive & l low ow c cost ost g guarantee uarantee � Retain 100% of ad revenues � Retain 100% of ad revenues 9
10 Showcase Top Consumer Brands in China
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12 REVIEW OF STRATEGY & EXECUTION
1H11 Highlights � China economic growth continues despite tightening � China economic growth continues despite tightening measures to contain inflation measures to contain inflation � Domestic demand being one of the engines behind � Domestic demand being one of the engines behind economic growth economic growth � Urbanization helps fuel growth in major cities � Urbanization helps fuel growth in major cities � Chinese brands & local advertisers increase ad spend � Chinese brands & local advertisers increase ad spend nd & 3 rd tier cities � More advertisers expand into 2 � More advertisers expand into 2 nd & 3 rd tier cities � Higher competitive pressure in Shanghai post World Expo � Higher competitive pressure in Shanghai post World Expo 13 13
1H11 Business Performance by Location � Total revenue from BJ, SH, GZ up 20% � Total revenue from BJ, SH, GZ up 20% YoY YoY to HK$352m to HK$352m • BJ: • BJ: Revenue +33% with improvement on both ASP & Revenue +33% with improvement on both ASP & occupancy rate occupancy rate • GZ: Revenue +38% with improvement on both ASP & • GZ: Revenue +38% with improvement on both ASP & occupancy rate occupancy rate • SH: Revenue +42% with Shanghai World Expo in 1H10 • SH: Revenue +42% with Shanghai World Expo in 1H10 Revenue - -11% in 1H11 without major event 11% in 1H11 without major event Revenue � Mid � Mid- -tier cities: Revenue up 11% tier cities: Revenue up 11% YoY YoY to HK$278m to HK$278m 14 14
Revenue by Industry 1H10 1H11 1H10 1H11 Beverages 25% 25% Beverages 25% 25% Food 12% 13% Food 12% 13% Telecommunications 12% 11% Telecommunications 12% 11% Fashion & ornaments 4% 11% Fashion & ornaments 4% 11% Entertainment 6% 9% Entertainment 6% 9% Information Technology 3% 6% Information Technology 3% 6% Realty 6% 5% Realty 6% 5% Business / Consumer services 6% 5% Business / Consumer services 6% 5% Cosmetics & Toiletries 6% 4% Cosmetics & Toiletries 6% 4% Pharmaceuticals / Health products 4% 4% Pharmaceuticals / Health products 4% 4% 15
2H11 Outlook � Leverage on rising private consumption � Leverage on rising private consumption � Strengthen leading position in nation � Strengthen leading position in nation- -wide outdoor market wide outdoor market � Re � Re- -invest in network expansion invest in network expansion � Increase bus shelter panel number through: � Increase bus shelter panel number through: - organic build organic build- -out out - - mergers & acquisitions mergers & acquisitions - 16 16
2H11 Outlook (con’td) � Further optimize ASP & occupancy rate � Further optimize ASP & occupancy rate � Explore alternative advertising platforms & � Explore alternative advertising platforms & emerging technology for display panel profitably emerging technology for display panel profitably � Revenue from Shanghai post World Expo to recover � Revenue from Shanghai post World Expo to recover 17
18 FINANCIAL REVIEW For the year ended 30 June 2011
1H11 Consolidated Income Statement (HK$’ ’M M) ) 1H10 10 1H11 11 (HK$ 1H 1H YoY % YoY % Turnover Turnover 585 585 691 691 +18% +18% Cost of sales, excluding amortization (272) (322) Cost of sales, excluding amortization (272) (322) +19% +19% Operating expenditure, excluding depreciation & (97)* (126) Operating expenditure, excluding depreciation & (97)* (126) +30%* +30%* amortization amortization EBITDA 216 243 EBITDA 216 243 +12% +12% Depreciation & amortization (119) (133) Depreciation & amortization (119) (133) +12% +12% EBIT 97 110 EBIT 97 110 +13% +13% Net profit 77 73 Net profit 77 73 -6% 6% - Basic EPS (HK cents) 14.7 13.8 Basic EPS (HK cents) 14.7 13.8 -6% 6% - *Operating expenditure, excluding depreciation & amortization, includes the Share Option Expense Adjustment booked in 1H10 19
1H11 Consolidated Income Statement, excluding the Share Option E xpense Adjustment Booked in 1H10 (HK$’ ’M M) ) 1H10 10 1H11 11 (HK$ 1H 1H YoY % % YoY Turnover 585 691 Turnover 585 691 +18% +18% Cost of sales, excluding amortization Cost of sales, excluding amortization (272) (272) (322) (322) +19% +19% Operating expenditure, excluding depreciation & Operating expenditure, excluding depreciation & (117) (117) (126) (126) +8% +8% amortization amortization EBITDA 196 243 EBITDA 196 243 +24% +24% Depreciation & amortization (119) (133) Depreciation & amortization (119) (133) +12% +12% EBIT 77 110 EBIT 77 110 +42% +42% Net profit 57 73 Net profit 57 73 +27% +27% 20
Performance by Activities Bus Shenzhen Other Bus Shenzhen Other (HK$’ ’M M) ) (HK$ Shelter Bus Body Formats Shelter Bus Body Formats HQ Total HQ Total Revenue 630 60 1 - 691 Revenue 630 60 1 - 691 EBITDA 253 3 - (13) 243 EBITDA 253 3 - (13) 243 EBIT 120 3 - (13) 110 EBIT 120 3 - (13) 110 Net Profit/(Loss) /(Loss) 85 2 - (14) 73 Net Profit 85 2 - (14) 73 21 21
Revenue by Location 1H10 1H10 1H11 11 1H Beijing 23% Beijing 27% Others Others 44% 46% Shanghai 17% Shanghai 13% Guangzhou Guangzhou 14% 16% 22 22
Costs & E xpenses 1H10* 1H11 1H10* 1H11 ( HK HK $ $’ ’ M M ) ) ( YoY % YoY % Rental 151 176 Rental 151 176 +17% +17% Maintenance 48 59 Maintenance 48 59 +22% +22% Electricity 26 29 Electricity 26 29 +11% +11% Sales & Cultural Tax 47 58 Sales & Cultural Tax 47 58 +25% +25% Direct operating costs 272 322 Direct operating costs 272 322 +19% +19% S, G & A & other expenses & other expenses 117 126 S, G & A 117 126 +8% +8% Total costs & expenses, 389 448 Total costs & expenses, 389 448 +15% +15% excluding depreciation & amortization excluding depreciation & amortization *Exclude Share Option Expense Adjustment booked in 1H10 23
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