1
UBS 36th Annual Global Media & Communications Conference
- Dec. 8-10, 2008
UBS 36 th Annual Global Media & 1 Communications Conference - - PDF document
UBS 36 th Annual Global Media & 1 Communications Conference Dec. 8-10, 2008 Safe Harbor This presentation and managements public commentary contain certain forward-looking statements that are subject to risks and uncertainties. These
1
UBS 36th Annual Global Media & Communications Conference
2 This presentation and management’s public commentary contain certain forward-looking statements that are subject to risks and uncertainties. These statements are based on management’s current knowledge and estimates of factors affecting the Company’s
to, the statements regarding broadcast pacings, publishing advertising revenues, as well as any guidance related to the Company’s financial performance. Actual results may differ materially from those currently anticipated. Factors that could adversely affect future results include, but are not limited to, downturns in national and/or local economies; a softening of the domestic advertising market; world, national, or local events that could disrupt broadcast television; increased consolidation among major advertisers or other events depressing the level of advertising spending; the unexpected loss or insolvency of one
purchasing and/or television viewing patterns; increases in paper, postage, printing, or syndicated programming costs; changes in television network affiliation agreements; technological developments affecting products or the methods of distribution; changes in government regulations affecting the Company’s industries; unexpected changes in interest rates; and the consequences of any acquisitions and/or dispositions. The Company undertakes no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise.
3
4
National Brands
Revenues: $1 billion
Local Brands
Revenues: $300 million
Online & Diversified
Revenues: $300 million
Strategic Overview
5
Strategic Overview
6
35% 34% 30% Television 2.1% 1.0% 2.0% Other 18% 24% 29% Newspapers 100% 4.8% 14% 5.7% 6.0% 6.6% 8.0%
2010 Forecast
100% 100% TOTAL 3.7% 2.8% Out of Home 8.6% 3.6% Pure-Play Internet 5.3% 5.9% Trade Magazines 6.7% 6.8% Consumer Magazines 7.5% 8.8% Yellow Pages 9.4% 11% Radio
2007 2000
Source: Veronis Suhler Stevenson –September 2008
Strategic Overview
7
2 NA More 52 46 Subtotal 91 82 Subtotal 40 34 Better Homes and Gardens 6 6 Fitness 21 18 Special Interest Media 143 128 TOTAL 7 6 American Baby 16 12 Parents 21 22 Family Circle 9 6 Other 8 8 Country Home 13 16 Ladies’ Home Journal
2008 1998 Strategic Overview
+12%
Source: Fall 1998 & 2008 MRI Reports
Readership in Millions
8
Strategic Overview
85% 1.2M More 94% 3.8M Ladies’ Home Journal 80% 3.8M Family Circle 98% 2.2M Parents 950,000 1.5M 7.6M
Rate Base
97% Better Homes and Gardens 88% Traditional Home 87% Fitness
% of circulation from subscriptions
– Both for renewals and new offers
– Acquired titles now at 60%
– 3.3 million annually
9
380 240 News hours 420,000 330,000 Morning news viewership 1 Million 900,000 Late news viewership 11M HH 10M HH Market growth
Strategic Overview
Source: Nielsen
10
+30% +40% +150% +64% +17%
Source: Nielsen November 2008
Morning news Late news Strategic Overview
11
subscriptions
Strategic Overview
12
13
11% 17% Direct Response +1% 11% 7% Cosmetics
9% 24% Home +13% 5% 4% Retail 4% 5% 11% 22% Calendar 2008*
+23% +24% +13%
7-Year Cumulative Industry Growth**
5% 3% 7% 12% Calendar 2001* Non-DTC Travel Pharmaceutical Food
How we will Grow
** TNS Media Intelligence, Jan.-Sept. 2001 & 2008 * Meredith data
14
– Maximize salesforce efficiency – Stress efficiency of portfolio:
– Emphasize bundled programs
How we will Grow
12
15
– Access more clients directly – Forge deeper senior-level ties – Sell solutions, not only ad space – Emphasize consumer insights
How we will Grow
16
– Special sales initiatives – Contests and incentives
– Cornerstones – Job Connections – Product Integration and Sponsorships – Better Health – Cool Schools
How we will Grow
17
18
19
– Social Networking
– Unique visitors up 13% YTD Calendar ‘08
Grow New Revenue Streams
18
20
– Share and find recipes – Browse ratings and reviews – Join or start a group – Contribute to discussions – Find answers to her questions – Connect with other users
Grow New Revenue Streams
21
Grow New Revenue Streams
– 90% of users are women ages 25-48
– Option to buy company
22
Meredith I ntegrated Marketing O’Grady Meyers Genex New Media Strategies Directive Big Communications
Grow New Revenue Streams
Custom Publishing Online CRM Strategy, Branding & Promotions Web Site Design and Marketing Viral and Word of Mouth Marketing Database Marketing Healthcare Marketing
23
2004 2006 2008 Fiscal Year 2004 2006 2008 Fiscal Year
$155
25% CAGR
$ in millions
$83 $60
Grow New Revenue Streams
$30
40% CAGR
$15 $8
24
Grow New Revenue Streams Grow New Revenue Streams
25
– Full line of Better Homes and Gardens home products – Currently over 550 SKUs per store – Planned expansion of home and gardening/outdoor living product lines in 2009 Grow New Revenue Streams
26
minimum guarantees
Meredith creative team
Walmart marketing support
Meredith marketing support
Grow New Revenue Streams
27
Mahaka Russia (Wood) Indonesia (Fitness, Parents) Canada (MORE, SIP) Aust ralia (BHG, DL) Brazil (Parent s) Thailand (Parent s, MORE) China (Parent s, BHG, MORE) India (BHG, Child) Korea (BHG) MENA (BHG, Parent s, DL) Spain (DL, HHL) Mexico (DL) It aly (DL)
Grow New Revenue Streams
26
28 Magazines Out-of-Home
Sampling, Doctor’s office wallboard advertising
Custom Publishing Consulting Creative Services Consumer Insights
Ethnography
Database 300K+
Direct Mail
EVENTS
Siempre Inspiran Awards, retail
Blogs
Grow New Revenue Streams
29
(Actual) (Actual) (Estimate) Grow New Revenue Streams
$ in millions
30
Grow New Revenue Streams
– Local advertising – Sponsorships – Syndication
– Advertising spots – Sponsorships – Product placement
31
Kansas City Phoenix Saginaw Hartford Nashville Las Vegas Greenville Portland Springfield
10 Meredith markets 30 Non-Meredith markets
Bakersfield San Francisco
3 New markets (early 2009)
Norfolk Philadelphia Indianapolis Cleveland Denver San Diego Chattanooga Green Bay Milwaukee
Salt Lake City Grand Rapids Harrisburg Scranton Albuquerque Providence Buffalo Toledo Rochester Portland Spokane Champaign Jackson Tri-Cities Colorado Springs Yakima Medford Elmira Dothan Charlottesville
Grow New Revenue Streams
Binghamton
“Better” syndicated show markets
32
33
Financial Overview
2004 2005 2006 2007 2008
$163 $171 $194 $211 $256
12% CAGR
$ in millions
34
200 Stock Option Exercises $2,200 Utilization of Cash 200 Dividends 700 Share Repurchases $1,000 Acquisitions, Net of Dispositions $2,200 Available Cash 300 Net Debt $1,700 Operating Cash Flow
$ in millions
Financial Overview
300 Capital Expenditures
35
$0.28 $0.30 $0.32 $0.34 $0.36 $0.38 $0.48 $0.56 $0.64 $0.74 $0.86
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Financial Overview
36
As of Nov. 30, 2008
Financial Overview
37
Financial Overview
Calculated using Meredith closing price on Dec. 5 and trailing 4 quarters actual results, excluding special items
38