Q4 2014 - Star Media Group Berhad

Read. Listen. Watch. Think. Be Inspired
Analyst Briefing
Tuesday, 3 March 2015
1
THE STAR MEDIA GROUP
Today’s Presenters
Ragesh Rajendran
Group CFO
Datuk Seri Wong Chun Wai
Group MD/ CEO
Roy Tan
CDO, Digital Business
Calvin Kan
Group COO & CEO, Star
Radio Group
Kudsia Kahar
COO, Star Radio Group
2
DISCLAIMER
This presentation and the discussion following may contain forward looking statements by The Star Publications Berhad
(“Company”) related to financial, market or industry trends for future period. Actual future performance, outcomes and results may
differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and
assumptions.
The statements are made based on facts and information available to the Company at the date of the presentation and merely
represent an expression of the Company management’s views, targets and expirations of future events. They do not in anyway
represent a forecast, projection, estimate or guarantee of the Company’s future performance and neither have they been
independently verified.
Accordingly no representation or warranty, express or implied is made to, and no reliance should be placed on the fairness,
accuracy and completeness of such information. The Company and its subsidiaries, representatives and officers shall have no
liability whatsoever for any loss, damage, costs and expenses arising out of or in connection with this presentation.
3
Agenda
1
2014
Overview
2
Quarter 4
2014
Group
Financials
3
Business
Segments
financials
4
Quarter 4
2014
highlights
5
Media
Outlook
2015 &
Strategy
4
2014 overview; A difficult market
Economic
uncertainty
Interest rate hike
Anxiety on GST
implementation
Aviation
tragedies
Subsidy
rationalisation
Resilient market - Total ad spend grew 3.7%
Ad spend by medium (% share)
YTD Dec 2014
45.0%
2.3%
40.0%
-0.6%
1
4
3
2
Total adex:
RM14.1bn in 2014
from RM13.6bn in
2013
30.0%
-0.6%
25.0%
20.0%
36.2%
38.5%
33.7% 33.1%
15.0%
23.4% 22.8%
10.0%
-0.2%
-0.1%
0.1%
3.5% 3.3%
1.0% 1.1%
1.0% 0.9%
0.3% 0.3%
In-store Media
Magazines
Cinema
Unchanged
Radio
5.0%
FTA TV
Newspapers
0.0%
Pay TV
% Share
35.0%
Source: Nielsen Media Research 2014
YTD Dec '13
YTD Dec '14
6
Group ended FY14 on sustained momentum
Print and online
• Resilient circulation;
• Lion share of ad spend
Event, Exhibition, Interior and Thematic
• Registered strong growth
TV Channel
• Revenue sustained with fewer contracts completed
Radio
• Decline in revenue with lower adex spending
Dividends
• Upheld at 18 cents
7
Outperformed a difficult market - Held up well
Print: Robust circulation; excellent share of adex
Circulation for English papers
400,000
FY 2014 Share of Adex (%)
English Newspapers
372,435
350,000 339,162
3.00%
300,000
250,000
200,000
5.70%
1.90%
27.90%
374,693
341,963
150,000
101,760
88,616
100,000
80,658
78,058
50,000
July- Dec 2013
61.60%
Jan- June 2014
The Star
Sunday Star
Media 1
Media 1, Sunday paper
The Star
Media 1
Media 2
Media 3
Media 4
• The Star: up by 9.8%
• Sunday Star: increase by 9.6%
Source: Audit Bureau of Circulations
8
Clear market leader in e-circulation
1,258
Media 7
1,151
1,360
1,324
Media 6
2,024
2,503
995
Media 5
1,317
0
Media 4
1,852
Media 3
1,566
8,833
Media 2
Jan - Jun 2013
Jul - Dec 2013
Jan - Jun 2014
11,126
2,442
Media 1
2,973
3,347
49,006
49,551
The Star
81,367
*Source: Audit Bureau of Circulation
17
9
Star Online, # 1 for local English news
The Star Online
Total Unique Visitors (000)
Month
1,600
Jan ‘14
908
1,400
Feb
919
1,200
Mar
1,331
April
971
May
985
June
817
July
909
Aug
828
Sept
759
Oct
920
1,000
800
600
400
200
Dec-14
Nov-14
Oct-14
Sep-14
Aug-14
Jul-14
Jun-14
May-14
Apr-14
Mar-14
Feb-14
Jan-14
0
MALAYSIAKINI.COM
The Star Online
Nov
877
THEMALAYSIANINSIDER.COM.MY
THEMALAYMAILONLINE.COM
Dec
1,078
NST.COM.MY
THERAKYATPOST.COM
Source: comScore Media Metrix
•
UV
The Star Online maintains its leadership position in local English
19
news category.
Source: comScore Media Metrix
10
Star Biz, # 1 local business news
Total Unique Visitors (000)
Business Vertical
450
400
350
300
250
200
150
100
50
0
Yahoo Finance
THESTAR.COM.MY Business
Bloomberg
FORBES.COM
WSJ.COM
THEEDGEMALAYSIA.COM
BUSINESSINSIDER.MY
•
Dec-14
Nov-14
Oct-14
Sep-14
Aug-14
Jul-14
Jun-14
May-14
Apr-14
Mar-14
Feb-14
Jan-14
Month
Star Business remains top local business news site in the
market while competing with international players locally.
UV
Jan ‘14
262
Feb
259
Mar
263
April
263
May
252
June
243
July
245
Aug
240
Sept
258
Oct
304
Nov
226
Dec
243
Source: comScore Media Metrix
11
Star Online
Digital Performance Jul
‘14
Jan‘13-Jun
- Dec ‘14
The Star Online
Total Unique Visitors (000)
Month
MALAYSIAKINI.COM
The Star Online
THEMALAYSIANINSIDER.COM.MY
THEMALAYMAILONLINE.COM
NST.COM.MY
Source: comScore Media Metrix
•
•
Dec
Nov
Oct
Sep
Aug
Jul
Jun
May
Apr
Mar
Feb
Jan-14
1,600
1,400
1,200
1,000
800
600
400
200
0
UV
Jan ’14
908
Feb
919
Mar
1,331
Apr
971
May
985
Jun
817
Jul
909
Aug
828
Sep
759
Oct
920
Nov
877
Dec
1,078
Source: comScore Media Metrix
The Star Online maintains its lead position in local English news category
Achieved higher traffic than Malaysiakini in most of the months (11/12)
12
Star Property Performance Jan- Dec ‘14
Vertical‘14
Star Digital PerformanceProperty
Sep ‘13-Sep
Total Unique Visitors (000)
Month
400
350
UV
Jan ‘14
231
Feb
191
Mar
188
150
Apr
193
100
May
203
Jun
201
Jul
163
Aug
254
Sep
275
Oct
275
Nov
286
300
250
200
50
IPROPERTY.COM.MY
Star Property
Dec
Nov
Oct
Sep
Aug
Jul
Jun
May
Apr
Mar
Feb
Jan-14
0
PROPERTYGURU.COM.MY
Source: comScore Media Metrix
Dec
268
Source: comScore Media Metrix
Star Property family (Propwall+iBilik+Starproperty.my) gaining momentum
since Aug’14 and has been on the uptrend
13
THE STAR’S MARKET SHARE AMONG MALAYSIAN
ENGLISH NEWSPAPER READERS:
86%
reads The Star
PMEB (PROFESSIONALS, MANAGERS,
EXECUTIVES AND BUSINESSMEN)
Total PMEB: 484,000
80%
reads The Star
80%
reads The Star
82%
FEMALE
Total PMEB: 796,000
reads The Star
75%
HOUSEHOLD
DECISION MAKERS
reads The Star
Total PMEB: 467,000
MALE
Total PMEB: 963,000
YOUTH
(15-24 YRS OLD)
Total PMEB: 374,000
23
14
Our readership profile
Chinese:
Malay:
Indian/Others:
PMEB:
30%
OWC:
27%
Students:
14%
Blue Collar:
12%
Homemaker:
10%
Unemployed/Retirees: 7%
40%
32%
28%
15 – 19 yo:
20 – 24 yo:
25 – 29 yo:
30 – 39 yo:
40 – 49 yo:
50 – 59 yo:
Over 60 yo:
KL/PJ: 45%
PG/PW: 11%
Ipoh:
7%
JB:
4%
Other Urban: 30%
Rural:
3%
9%
12%
14%
24%
17%
15%
9%
Male:
56%
Female: 44%
HI RM1 – RM1k:
1%
HI RM1,001 – RM2k: 10%
HI RM2,001 – RM3k: 15%
HI RM3,001 – RM4k: 12%
HI RM4,001 – RM5k: 14%
HI RM5,001 – RM6k: 12%
HI RM6,001 – RM7k: 8%
HI RM7,001 – RM8k: 7%
21%
HI over RM8k:
Source: Nielsen
22
15
Radio - Turnaround
(LBT)/PBT
1.5
1.00
1.0
RM million
0.5
0.0
1Q14
2Q14
3Q14
4Q14
(0.25)
-0.5
-1.0
(1.14)
-1.5
(1.23)
16
Radio - Growing listenership
Source GfK Radio Audience Measurement (Mid Aug - end Sept’ 14)
17
Radio- Growing listenership
Source GfK Radio Audience Measurement (Mid Aug - end Sept’ 14)
18
Attractive and consistent payouts
Dividends Per Share (sen)
20
18
Total 18 sen
Total 18 sen
6
6
Total 18 sen
16
Total 15 sen
14
6
3
sen
12
10
8
6
4
2
0
12
12
12
12
2011
2012
2013
2014
Ordinary Dividends
Media 1
Special Dividends
2011
2012
2013
2014
16 sen
13 sen
14 sen
11 sen
Agenda
1
2014
Overview
2
Quarter 4
2014
Group
Financials
3
Business
Segments
financials
4
Quarter 4
2014
highlights
5
Media
Outlook
2015 &
Strategy
20
12 months highlights 2014
Revenue
PBT
250
1,200
1,025
1,000
1
1,014
2
3
200
RM190.95m
800
RM million
RM million
37.53
600
150
100
193
153
400
50
200
0
2013
2014
2013
2014
Lower ad spend, VSS expenses & impairment losses
pared down bottom line
21
Performance of The Star Media Group
1Q14
2Q14
3Q14
4Q14
12M14
12M13
Var.
Revenue
211.14
274.52
247.19
280.89
1,013.74
1,025.33
(1.1)%
EBITDA
30.23
59.43
51.32
39.82
180.80
223.24
(19.0)%
PBT
21.65
52.78
46.69
32.30
153.42
192.59
(20.3)%
VSS Expenses
9.58
1.92
-
-
11.50
-
100%
26.03
26.03
(RM million)
Impairment
Expenses
Adjusted PBT
(excluding VSS &
100%
31.23
54.70
46.69
58.33
190.95
192.59
EBITDA Margin
14.3%
21.6%
20.8%
14.2%
17.8%
21.8%
PBT Margin
10.3%
19.2%
18.9%
11.5%
15.1%
18.8%
Adjusted PBT
Margin
14.8%
19.9%
18.9%
20.8%
18.8%
18.8%
(0.8)%
Impairment)
Adjusted PBT margin maintained despite lower revenue
22
Agenda
1
2014
Overview
2
Quarter 4
2014
Group
Financials
3
Business
Segments
financials
4
Quarter 4
2014
highlights
5
Media
Outlook
2015 &
Strategy
23
4Q14 Business Segments
1.
• Print and Digital
2.
• Event, Exhibition, Interior and Thematic
3.
• TV Channel
4.
• Radio
24
Performance of Star Publications (M) Bhd
Print and Digital Segment
1Q14
2Q14
3Q14
4Q14
12M14
12M13
Var.
Revenue
163.17
193.44
169.71
180.15
706.47
751.15
(5.9)%
EBITDA
31.20
52.74
46.58
52.02
182.54
216.77
(15.8)%
PBT
24.94
48.00
44.38
45.50
162.82
192.34
(15.3)%
VSS Expenses
9.58
1.92
-
-
11.50
-
100%
-
-
-
5.75
5.75
-
100%
Adjusted PBT
(excluding
VSS/impairment)
34.52
49.92
44.38
51.25
180.07
192.34
(6.4)%
EBITDA Margin
19.1%
27.3%
27.4%
28.9%
25.8%
28.9%
PBT Margin
15.3%
24.8%
26.2%
25.3%
23.0%
25.6%
Adjusted PBT
Margin
21.2%
25.8%
26.2%
28.4%
25.5%
25.6%
(RM million)
Impairment
Expenses
25
Lower adex, VSS expenses & impairment losses
4Q14 Business Segments
1.
• Print and Digital
2.
• Event, Exhibition, Interior and Thematic
3.
• TV Channel
4.
• Radio
26
Performance of I.Star Ideas Factory
Perfect Livin’
1Q14
2Q14
3Q14
4Q14
12M14
12M13
Var.
Revenue
2.21
13.18
8.51
4.79
28.69
24.31
18.0%
EBITDA/
LBITDA
(0.38)
6.75
4.40
0.17
10.94
8.41
30.1%
PBT/LBT
(0.35)
6.48
4.30
0.08
10.51
7.54
39.4%
EBITDA/LBITDA
Margin
(17.2)%
51.2%
51.7%
3.5%
38.1%
34.6%
PBT Margin
(15.8)%
49.2%
50.5%
1.7%
36.6%
31.0%
(RM million)
Y-o-Y increase in PBT margins; Additional shows;
Bulk of the events held between Q2-Q3
27
Performance of Cityneon Holdings Limited
Cityneon
1Q14
2Q14
3Q14
4Q14
12M14
12M13
Var.
Revenue
10.94
19.38
19.27
28.43
78.02
67.78
+15.1%
EBITDA
0.27
0.11
0.16
2.55
3.09
1.52
>100.0%
PBT/(LBT)
0.09
0.02
(0.06)
2.46
2.51
0.85
>100.0%
EBITDA Margin
2.5%
0.6%
0.8%
9.0%
4.0%
2.2%
PBT/(LBT)
Margin
0.8%
0.1%
(0.3)%
8.7%
3.2%
1.3%
(SG million)
Y-o-Y PBT improvement due to financial discipline &
completion of projects Q-o-Q
28
4Q14 Business Segments
1.
• Print and Digital
2.
• Event, Exhibition, Interior and Thematic
3.
• TV Channel
4.
• Radio
29
Performance of Li TV Holdings Limited
Li TV
1Q14
2Q14
3Q14
4Q14
12M14
12M13
Var.
Revenue
0.82
0.73
0.75
0.87
3.17
3.11
1.9%
LBITDA
(0.37)
(0.48)
(0.54)
(0.49)
(1.88)
(1.90)
1.1%
LBT
(0.40)
(0.51)
(0.53)
(0.52)
(1.96)
(1.98)
1.0%
LBITDA Margin
(45.1)%
(65.8)%
(72.0)%
(56.3)%
(59.3)%
(61.1)%
LBT Margin
(48.8)%
(69.9)%
(70.7)%
(59.8)%
(61.8)%
(63.7)%
(USD million)
Revenue affected by aviation tragedies
30
4Q14 Business Segments
1.
• Print and Digital
2.
• Event, Exhibition, Interior and Thematic
3.
• TV Channel
4.
• Radio
31
Performance of Radio Operations
Star Radio Group
1Q14
2Q14
3Q14
4Q14
12M14
12M13
Var.
Revenue
12.08
13.03
13.38
12.88
51.37
55.42
(7.3)%
EBITDA
0.71
0.38
1.49
2.05
4.63
4.96
(6.7)%
PBT/LBT
(1.14)
(1.23)
(0.25)
1.00
(1.62)
0.16
(>100.0)%
EBITDA Margin
5.9%
2.9%
11.1%
15.9%
9.0%
8.9%
PBT/LBT Margin
(9.4)%
(9.4)%
(1.9)%
7.8%
(3.2)%
0.3%
(RM million)
(after inter company transaction eliminations)
Lower adex affected bottom line
32
Agenda
1
2014
Overview
2
Quarter 4
2014
Group
Financials
3
Business
Segments
financials
4
Quarter 4
2014
highlights
5
Media
Outlook
2015 &
Strategy
33
Q4 highlights
•
Declared second interim dividend of 6.0 sen and special
dividend of 3.0 sen
•
Impairment of goodwill, receivables, film rights & Capital
FM radio license
•
Rationalisation of non-performing assets:
o Disposal of Shanghai in Nov’14, discontinuation of Faces
at end Sept’14 and disposal of Red Tomato in Dec’14
o Scaling down of Star Sarawak
1.
2.
3.
34
Agenda
1
2014
Overview
2
Quarter 4
2014
Group
Financials
3
Business
Segments
financials
4
Quarter 4
2014
highlights
5
Media
Outlook
2015 &
Strategy
35
Media landscape outlook 2015
1.
•
Adex expected to be weak in 1H15 as advertisers hold back
spending ahead of implementation of GST
2.
•
Expected acceptance of GST in 2H15; Adex expected to
normalise barring unforeseen circumstances
3.
•
Digital adex expected to grow but more fragmented
36
Strategies Update
Print
1.
2.
•
•
Strengthen print by continued financial discipline
Strategic alliance with local media
Digital
•
•
Grow online business & strengthen online sales capabilities
Property classifieds as a specialised business
Radio
3.
•
Invest in top content and talent
Events & Exhibitions
4.
•
•
Strengthen market position for perfect livin’
Expansion into other markets both locally and abroad including
emerging markets for Cityneon
New revenue stream
5.
•
Transit advertising
37
Strategies Update
Continuous financial discipline
6.
•
Cost control measures and efficiency improvement
38
THANK
YOU
39
THE STAR MEDIA GROUP