INVESTOR BRIEFING 2019 HALF YEAR PERFORMANCE WEDNESDAY 28 TH AUGUST - - PowerPoint PPT Presentation

INVESTOR BRIEFING

2019 HALF YEAR PERFORMANCE

WEDNESDAY 28TH AUGUST 2019

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Business Objective & Updates H1 Highlights H1 Group Results Q & A

AGENDA

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Our Pr Our Produc

• ducts

ts

www.nationmedia.com

Rwanda Uganda Tanzania Kenya

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Our V Our Values alues

Consumer Focus Continuous Improvement & Innovation Drive for Performance Integrity & Trust

Inspiring leadership; Team work; Continuous improvement

We are a team

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Business Business Objectiv Objective e & Upda & Updates tes

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We ar e are c e clear on our business lear on our business objectiv bjective

• We are a content company

Our competitive edge will be based

• n content
• Digital, Innovation & Our values

Are enablers to achieve the business objective

• Purpose for NMG

To transform society in a sustainable manner

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Growing content business and creating new value

Innovate to continuously meet consumer demands Develop new products to maintain competitive edge Growing the top line  Grow current revenues  Generating new revenue streams Strengthen performance

• f legacy brands

Investing in the right talent and capabilities Productivity & Efficiency Strengthen the bond with audiences Quality, Credible & Trusted Content

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Bus usines iness s Mo Mode del

Media Advertiser Consumer

TRADITIONAL CURRENT

• Invest in understanding the consumer to develop products that connect and engage them
• Diversifying revenue opportunities (advertiser and consumer)
• Adopt the right distribution model to engage audiences (Enhanced user experience)

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Our Action Agenda Our Action Agenda

Track and understand the changing needs of the CONSUMER

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Produce dynamic CONTENT that evolves with its user

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Recruit and grow AUDIENCES (Across platforms)

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Leading societal conversations by LIVING OUR VALUES (Always)

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Deliver superior USER EXPERIENCE (Across platforms)

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27.9 .9

Footprint (in millions) *367# for Breaking News Alerts in English & Swahili

DIGIT DIGITAL AL Footprint

• otprint

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In Investment estment in under in understanding standing our audiences

• ur audiences

Capacity Building & Training

Data Scientists, Data Analysts, Data Engineers Tablaeu, Microsoft Power BI,, Google Analytics 360, Oracle Data Management Platform

Tools & Technology Consumer Insights & Engagement

• Created a foundation for user/customer journey analytics and basic

personas of users on our platforms

• Obtaining user behaviour insights from website user data on NMG online

properties, used for content improvement and development.

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Pr Protecting

• tecting Na

Nation tion jour journalism nalism

Sustainability dependent on content quality

Talent Management Partnerships Integrity & Professionalism Quality

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Con Content tent monet monetisa isation tion

Building a profitable and sustainable digital business model

Mobile Apps

• Healthy Nation
• Seeds of Gold
• MyNetwork

Gateway

• Premium content
• Micropayments
• Term subscription

Syndication

• Video
• Graphics
• Photos
• Stories

(Payment: Mpesa, Card)

Product improvement

• Daily Nation
• Saturday Nation
• Sunday Nation
• The East African

Content Focus

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2017 2018 2019 Year/Month Subscribers

E-Paper per Subscription T Subscription Trend end

Subscription growth of 67% in the last 12 months

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Use of analytics, research and insights to drive client objectives Refining communication channels

Monetising digital audiences

Targeted advertising Building Strategic Partnerships

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• Integrated majority of movie cinemas in Nairobi on KenyaBuzz
• Site revamp to provide an unparalleled user experience

An online movie and events ticketing platform

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LIT MUSIC is Kenya’s newest and most exciting record label that brings together the newest, most talented and diverse artists Kenya has to offer. Through our TV programmes, radio shows, Label artists and events, LIT MUSIC brings the BIGGEST moments in music entertainment to fans

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Performing every Friday from 6pm at the Westgate Pop Up Market

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Ev Events objectiv ents objective

 Enrich discourse on key issues  Contribute development agenda  Aligned to NMG’s core purpose of quality journalism

Shape pe conversa sations tions

 Generate unique content  Repurposed across platforms  Opportunity to serialise issues

Content tent developm lopment nt

Oppor portun unity for alterna rnativ ive revenue ue stream Stron

• ng

g valua uable le stakeho holde der r rela latio ionshi hips ps Protect & Enhanc nce NMG’s Reputation

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2019 Ev 2019 Events Upda ents Update te

The Leading Woman Q4, 2019 Top 40 Under 40 women Nomination on-going Top 100 Survey (Kenya) Currently accepting entries Live2Lead with John Maxwell October 11th , 2019 Serena Hotel - Nairobi Seeds of Gold: Farm Clinic Narok, Thika, Kajiado MyNetwork Career Fair NTV On The Road Westgate Auto Show

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Thoug hought Le ht Leader adership F ship For

• rums

ums

Nation Leadership Forum Nation Leadership Forum Mwananchi Thought Leadership Forum Mwananchi Thought Leadership Forum

Theme: The Charcoal question in our Economy and the Environment Date: 7th February 2019 Theme: Securing our Safety Date: 8th April 2019 Theme: Our Agriculture, Our Lifeline Date: 23rd May 2019 Theme: The Next Generation of Work Date: 29th July 2019

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NMG a NMG at 60 Activities t 60 Activities

Staff Funday Staff NMG at 60 party to celebrate all staff members who have been involved in the journey and built NMG to the regional media house it now is.

Objective: Celebrate 60 years of being a true, trusted & independent champion of society while also building a basis for NMG’s sustainability

Client Appreciation Cocktails Client cocktails held at the Nation Centre to celebrate and appreciate our partners and continue to build upon our existing relationships. NMG at 60 Launch Cocktail and festival of lights display to mark the start of the celebrations and showcase NMG as a digital and innovative brand

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Distributor Conference Two day conference with all NMG distributors across the country to strengthen valuable relationships with them and continue to build upon the mutual partnership.

2. 3. 4.

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KUSI Ideas KUSI Ideas Festival estival

The theme will be “The Next 60 Years in Africa” and will bring together diverse influential leaders, innovators, young entrepreneurs and some of the best policy minds on the continent including Heads of State.

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NTV Pr NTV Prog

• gramming

amming

Strong news & entertainment content to drive growth of audiences

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NTV NTV Fea eatur tures es

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NTV R NTV Revamp vamp

• News
• Current affairs
• Investigative

journalism

• Features
• Entertainment

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QTV R TV Re-launc launch h

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Highlights Highlights

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Cor Corpor porate Social R te Social Respo esponsibilit nsibility

Murumba Primary Sch. March 22nd, 2019. The school serves a population of 660 pupils. Laikipia County Rehabilitation Centre May 17th, 2019. The facility serves as a rehabilitation centre for 80 children. Mama Fatuma Goodwill Children’s Home May 23rd, 2019. The facility caters for 65 children in house and 20

• n home based care with

relatives. Kiwandani Primary Sch. July 19th 2019. The school serves a population of 1453 pupils.

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Annual Annual Jour

• urnalism

nalism Ex Excellence Aw cellence Awar ards ds 2019 2019

Gender Print – Angela Oketch Kenya’s first human milk bank finally ready to save babies’ lives Health Print – Angela Oketch Counties: How we got women to ditch home birth Devolution TV – Edmond Nyabola & Robert Gichira From cot to court Governance Print – Brian Wasuna Kenyans to pay Sh6bn in meat factory scandal Sports Print – Celestine Olilo Rotting in jail: The footballing talent we waited for in vain ICT Print – Waikwa Maina With this mobile app you can run your farm on remote control Business Print – John Kamau Fertilizer politics and how the factory was derailed. Winners: Elias Makori – African Media Personality Award Winner - The Voice Achievers Awards

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Ex Excellenc cellence Aw e Awar ards ds

Winners: Eunice Omollo (TV Category) Best Health Reporting - Africa Media Health Network Awards Eunice Omollo (Overall) Best Health Reporting - Africa Media Health Network Awards Eunice Kilonzo (Print Category) Best Health Reporting - Africa Media Health Network Awards Rose Wangui Winner – Knight International Journalism Award JuniorSpot Best New Print Product (3rd place) NTV Uganda Most Admired Media Brand in Uganda – Brand Africa 100 NTV Kenya – Winner Persons With Disability Accessibility Award Sharon Baranga Best report for Early Childhood Education

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H1 2019 H1 2019 Gr Group

• up

Results esults

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Perf erfor

• rmance Dr

mance Driv iver ers

DATA

Data & Analytics Audience Monetisation Content Monetisation E-Paper Partnerships Newsprint price increase Challenging business environment Interest income decline Currency Depreciation Debt Productivity & Efficiency

NMG@60 NMG@60

60th Anniversary Celebrations Enhancement of Digital Structure Sector-based selling

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>100 %

Music

24%

Digital Copy Sales Cash generated from

• perations

25% 15%

Kenya Buzz

>100 %

Google Ads

H1 H1 Perf erfor

• rmance

mance Highlights Highlights

37

30

7.9

16.9k

22.1

33.6 9.25

20.2k

24.3

Tur urno nover T er Trend (Kshs m) end (Kshs m)

• 1,000

2,000 3,000 4,000 5,000 6,000 2016 2017 2018 2019 5,635 5,274 4,923 4,580

Turnover Year

38

30

7.9

16.9k

22.1

33.6 9.25

20.2k

24.3

Dir Direct Costs (Kshs ect Costs (Kshs m) m)

• 200

400 600 800 1,000 1,200 2016 2017 2018 2019 1,054 956 851 970

Cost Year

39

30

7.9

16.9k

22.1

33.6 9.25

20.2k

24.3

Oper Operating Costs ( ting Costs (Kshs m) Kshs m)

2,000 2,500 3,000 3,500 2016 2017 2018 2019 3,436 3,147 3,310 3,030

Cost Year

40

30

7.9

16.9k

22.1

33.6 9.25

20.2k

24.3

Total Cos

• tal Costs (

ts (Kshs m) Kshs m)

1,500 2,500 3,500 4,500 2016 2017 2018 2019 4,490 4,103 4,161 4,000

Cost Year

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Co Cons nsolida

• lidate

ted d St State teme ment nt of

• f Com

Compr preh ehen ensiv sive e Inc Incom

• me

e ( Kshs ( Kshs m) m)

June June 2019 2018 % change Turnover 4,580.4 4,923.1 (7.0) Profit before income tax 580.8 761.8 (23.8) Income tax expense (177.1) (232.6) 23.9 Profit after income tax 403.7 529.2 (23.7) Other comprehensive income 13.0 (74.2) 117.5 Total comprehensive income 416.7 455.0 (8.4)

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Sta State temen ment t of

• f Finan

Financial cial Pos

• sition

ition ( ( Ksh Kshs s m) m)

June December 2019 2018 Capital and reserves Share capital 471.4 471.4 Other reserves (124.0) (136.4) Retained earnings 6,946.7 6,826.0 Proposed dividends 942.7 659.9 8,236.8 7,820.9 Non controlling interest 57.5 56.7 Total equity 8,294.3 7,877.6 Non-current liabilities 27.8 30.0 Total equity and non current liabilities 8,322.1 7,907.6 Assets Non-current assets 4,598.7 4,770.0 Working capital Current assets 7,247.4 6,428.0 Current liabilities 3,524.0 3,290.4 Net working capital 3,723.4 3,137.6 Total Assets 8,322.1 7,907.6

Growth in total assets of 5.2% from December 2018

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Con Conde dens nsed ed Cas Cash h Flo low Sta w State temen ment t (Kshs (Kshs m) m)

June December 2019 2018 Cash generated from operations 967.6 1,142.2 Tax paid (382.0) (566.6) Net cash from operating activities 585.6 575.6 Net cash used in investing activities 141.8 309.2 Net cash from financing activities

• (1,697.4)

Increase in cash and cash equivalents 727.4 (812.6) At start of period 867.1 1,692.6 Exchange gains/(losses) on cash and cash equivalents 6.1 (12.9) At end of period 1,600.6 867.1 Short term investments 1,186.1 1,288.2 Total cash 2,786.7 2,155.3

Growth in total cash of 29% from December 2018

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Interim Interim Dividends Dividends

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Ear Earning nings s Per er Sha Share e (Ksh Kshs)

2.4 2.2 2 2 2 2 2 2 2 2

2018 2019

Earnings Per Share (Kshs) Year

1.50 1.50 1 1 1 1 1 2

2018 2019

Dividend per Share (Kshs) Year

Int Inter erim im Divid Dividen end d (Ksh (Kshs) s)

2.41 2.21

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7.9

16.9k

33.6 9.25

20.2k

24.3

Our Pr Produc ucts ts

Tanzania Rwanda Uganda

Mwananchi.co.tz @MwananchiNews MwananchiNews @MwanaSpotiTZ MwanaSpoti Theeastafrican.co.ke @TheEastAfrican TheEastAfrican

Kenya

Citizen.co.tz The Citizen TZ The Citizen Tanzania Nation.co.ke @Daily Nation Daily Nation ntv.co.ke/live @NTV Kenya NTV Kenya businessdailyafrica.com @BusinessDailyAfrica Taifaleo.nation.co.ke @Taifa_Leo Taifa Leo Kenyabuzz.com @KenyaBuzz Kenya Buzz Nariobinews.nation.co.ke @nairobinews Nairobi News @BD_Africa Theeastafrican.co.ke @TheEastAfrican TheEastAfrican @NTVUganda NTVUganda @DembeFM Dembe FM monitor.co.ug 933KFM monitor.co.ug @Daily Monitor Daily Monitor monitor.co.ug @Daily Monitor Daily Monitor @SparkTVUganda SparkTVUganda Theeastafrican.co.ke @TheEastAfrican TheEastAfrican Theeastafrican.co.ke @TheEastAfrican TheEastAfrican

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www.nationmedia.com