2. A UNIQUE ENTERTAINMENT
FOOTPRINT
32 FREE-TV CHANNELS
IN 10 COUNTRIES
SATELLITE PAY-TV PLATFORMS
IN 9 COUNTRIES
>90 MILLION WHOLESALE PAYTV CHANNEL SUBSCRIPTIONS
IN 36 COUNTRIES
2
5. WITH A BALANCED REVENUE MIX
INTEGRATED & DIVERSIFIED
MTG REVENUE SPLIT – BY SOURCE (2012)
REVENUE SPLIT – BY SEGMENT (2012)
9%
25%
34%
42%
49%
41%
Advertising
Subscription
Other
Emerging Markets
Pay-TV Nordic
Free-TV Scandinavia
34% OF PROFITS GENERATED IN EMERGING MARKETS
5
6. DELIVERING SHAREHOLDER VALUE
SIGNIFICANTLY OUTPERFORMING THE INDUSTRY AND
THE GENERAL MARKET
Sales: +10% CAGR
EBIT: +24% CAGR
Average ROCE: 25%
15% TSR
CAGR (10Y)
Total distribution to
shareholders: SEK 8.1 bn
DRIVEN PRIMARILY BY STRONG GROWTH AND HIGH
RETURNS WHICH IS THE DNA OF MTG
6
7. DRIVEN BY A TRACK RECORD
OF CONSTANT INNOVATION
1987
1991
Launch of first
Scandinavian
free-TV channel
Viasat is first in
the Nordics to
launch satellite
pay–TV platform
2001
2005
Viasat 1st in Europe to
Viasat launches
switch off analogue PVR recordable STB
distribution of premium
channels after switch to
digital satellite platform
2009
2011
2012
Catch-up services
introduced in
Scandinavia
Viaplay launched
in the Nordics
Like.tv launched
in Sweden
7
8. AND THE CONSTANT EXPORTING
OF A SUCCESSFUL OPERATING MODEL
1987
Sweden, Norway & Denmark
1996
Estonia & Finland
1997
Lithuania
1998
Latvia
2000
Hungary
2001
Russia
2003
CIS countries
2005
Czech Republic
2006
Slovenia
2008
Bulgaria, Ukraine & Ghana
2013
Tanzania
OUR 60 CHANNELS ARE NOW AVAILABLE IN 36 COUNTRIES SPANNING 4
CONTINENTS & REACHING >100 MILLION PEOPLE
WE ARE PRESENT IN MARKETS WITH TOTAL COMBINED ANNUAL TV ADVERTISING
SPEND OF 2.7 BILLION DOLLARS AND PAY–TV SUBSCRIPTION SPEND OF
ALMOST 12.5 BILLION DOLLARS
8
9. CONTENT REMAINS KING
AND WE ARE THE BIGGEST BUYER IN TOWN
TOTAL NUMBER OF BROADCAST HOURS (2013)
1,000,000
900,000
879,470
800,000
700,000
600,000
481,800
500,000
394,200
400,000
297,840
300,000
236,520
210,240
CME
Pro7
200,000
100,000
0
MTG
RTL
Bonnier
Mediaset
Source: MTG Research
9
10. ENABLED BY A UNIQUE POSITION
AN INTEGRATED MODEL IS INCREASINGLY IMPORTANT
SPLIT OF CONTENT HOURS
20 YEARS AGO
Sport
OP
UNIQUE MARKET POSITION
MTG TODAY
(NORDIC ONLY)
4%
6%
Pay-TV
Free-TV
Channel
distr.
SVOD
AVOD
TVOD
30%
10%
Acquisition
90%
60%
Growth used to come from acquisition, but has now changed to more premium and local
MTG has an edge over the competition with local content, sport and strong acquisitions
10
11. AND OVERALL VIDEO CONSUMPTION
IS CONTINUING TO GROW
VIDEO USAGE IN THE USA – MINUTES PER DAY PER USER 2+
NON – LINEAR
ONLINE VIDEO
MOBILE VIDEO 1
TIME SHIFTED 2
TRADITIONAL
LINEAR TV
323
4
7
12
301
337
6
16
7
7
307
19
364
15
11
22
357
11
10
24
318
312
313
358
350
7
317
9
10
CAGR +19%
25
CAGR +1%
Q1 ’08
Q1 ’09
Q1 ’10
Q1 ’11
Q1 ’12
Q4 ’12
1 Data for Q1 2008 as of May 2008; Mobile video data referring to watching Video via phone; Historic data not fully comparable due to changes in the methodology
2 Data for all TV households (significantly higher for household that own a DVR)
SOURCE: Nielsen Cross Platform reports
11
12. WE CAN CONTINUE TO INVEST
DUE TO OUR ASSET LIGHT & CASH GENERATIVE SET-UP
NET DEBT (SEK MN)
STRONG CASH FLOW GENERATION (SEK MN)
4,000
2,500
3,500
2,000
3,000
2,500
1,500
2,000
1,000
1,500
1,000
500
500
0
0
2008
2009
2010
2011
2012
9m '13
2004 2005 2006 2007 2008 2009 2010 2011 2012
12
13. IN LONG TERM VALUE CREATION
IN 3 CORE AREAS
MAJOR INVESTMENT INITIATIVES:
GEOGRAPHICAL
EXPANSION
1. CONTENT – WE HAVE SIGNIFICANTLY STRENGTHENED
OUR CONTENT POSITION ACROSS OUR PLATFORMS
2. VIAPLAY – FURTHER ESTABLISHING OUR OTT SERVICE
AS THE LEADING PROVIDER
3. CIS – EXPANSION INTO THE PREMIUM PAY-TV MARKET
4. AFRICA – NEXT IN LINE IS TANZANIA
CONTENT
DIGITAL
5. ONLINE – INCLUDING THE LAUNCH OF MTGx
13
14. COMBINED WITH M&A
A LOT OF VALUE SITS IN INTEGRATION
EV / EBITDA MULTIPLES OF KEY TRANSACTIONS IN 2012
PRICE AT ACQUISITION
BASED ON LTM
DELIVERY IN 2012
EXPECTATION FOR 2013
11.0x
8.2x
<5.5x
COMPETITIVE PRICE
DELIVERING THE PLAN
MOVING FORWARD
MTGB CURRENTLY TRADES ON ~9.5X EV / 2013E EBITDA
14
16. Q3 2013 – HIGHLIGHTS
INVESTING IN MOMENTUM
Sales up 9% at constant FX - all 5 segments reported local currency sales growth for first time since Q1 2011
FTV Scandi – growing again on a combined basis & positive traction to Fall schedules (new channel coming in Norway)
FTV EM – advertising market share gains in almost all territories in soft markets (new channel coming in Tanzania)
PTV Nordic – rising Viaplay volumes & Viasat ARPU driving sales growth & operating margin of 11.9%
PTV EM – healthy sales growth driven by mini-pay Russia & profitability in line with ongoing HD roll-out
Soon to complete acquisition of Nice Entertainment & establish scale international content production & distribution player +
MTGx digital accelerator established
Continued strong cash flow generation & low gearing enable ongoing investment in growth & shareholder returns
Coverage of the Winter Olympics will boost sales and adversely impact Q1 2014 profits for both the Nordic pay-TV and
Scandinavian free-TV businesses
16
17. Q3 IN FIGURES
GROWTH & INVESTMENTS
Sales up 9% y-o-y at constant FX
Q3 in brief
2012
Jul-Sep
2013
Jul-Sep
2,940
3,204
Growth (at constant FX)
-1%
9%
288
162
9.8%
5.0%
422
289
14.4%
9.0%
Organic growth at 5%
Sales (SEKm)
EBIT margin (excl. associates) of 5.0%
OpEx up 15% at constant FX and 11% organically
EBIT excl. associates
Significant investments in Nordic & Emerging Markets pay-TV
businesses to drive future growth
EBIT margin excl. associates
Continued strong cash conversion
Total EBIT
Total EBIT margin
Working capital change in the quarter reflecting the timing of
programming payments. Still under strict control
Cash flow from operations
237
210
Dividend stream from CTC Media of SEK 62m (51)
Changes in working capital
65
-160
Acquisition of DRG, Novemberfilm and Net info
Net cash flow from operations
302
49
17
18. FREE-TV SCANDINAVIA
GROWTH BACK INTO POSITIVE TERRITORY
STABLE SALES (Y-O-Y) AT CONSTANT FX
EBIT (SEK MN) AND EBIT MARGIN (%)
12%
10%
8%
6%
4%
2%
0%
-2%
-4%
-6%
-8%
-10%
250
25%
200
20%
15.4%
150
13.3%
15%
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
Q1 2012
Q4 2011
Q3 2011
Q2 2011
100
10%
50
5%
0
0%
Q3 2012
EBIT
Q3 2013
EBIT margin
OPEX GROWTH (FY 13) STILL EXPECTED TO BE AT THE HIGHER END
OF THE MID-SINGLE DIGIT PERCENTAGE RANGE
18
19. FREE-TV SCANDINAVIA
WEAK START BUT STRONG ENDING TO THE QUARTER
CSOV (15-49) – Q3 2013 VS Q3 2012
40.0
35.0
30.0
25.0
20.0
15.0
10.0
5.0
0.0
CSOV (15-49) – 2006 TO 2013 (YTD)
40
35.8 34.7
35
25.8
21.6
30
18.5 17.3
25
20
15
10
Sweden
Q3 2012
Denmark
Norway
Q3 2013
2006
2007
Sweden
2008
2009
2010
2011
Denmark
2012 9m 2013
Norway
WITH FURTHER OPPORTUNITIES – HOWEVER THERE IS A
LAG BETWEEN AUDIENCE SHARES AND AD SHARES
19
20. FREE-TV EMERGING MARKETS
STRONG GROWTH – TOUGHER COMPS AHEAD
21% SALES GROWTH (Y-O-Y) AT CONSTANT FX
EBIT (SEK MN) AND EBIT MARGIN (%)
30%
3.8%
50
20%
8%
6%
100
25%
4%
2%
15%
0
10%
0%
-50
5%
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
Q1 2012
Q4 2011
Q3 2011
Q2 2011
0%
-5%
7.9%
150
35%
-2%
-100
-4%
Q3 2012
9m 2012
EBIT
Q3 2103
9m 2013
EBIT margin
IMPROVED PROFITABILITY BUT CONTINUED INVESTMENTS
AT THE SAME TIME AS GROWTH IS EXPECTED TO MODERATE
20
21. FREE-TV EMERGING MARKETS
AUDIENCE SHARE GAINS IN ALMOST ALL MARKETS
CSOV (15-49) – (%)
60
50
TV AD MARKETS IN MTG TERRITORIES
47.0 50.0
40.4
40
28.4
30
32.8
36.0
20
10
0
Baltics
Bulgaria
Q3 2012
Czech Rep.
10
9
8
7
6
5
4
3
2
1
0
Q3 2013
SEK
8.6 bn
2008
SEK
5.4 bn
2012
SEK 3.2 BN OR 60% GROWTH POTENTIAL IF WE
SEE A FULL RECOVERY IN THE TV AD MARKET
21
22. PAY-TV NORDIC
PROFITABILITY INLINE WITH EXPECTATIONS
7% SALES GROWTH (Y-O-Y) AT CONSTANT FX
EBIT (SEK MN) AND EBIT MARGIN (%)
12%
300
10%
250
8%
200
6%
150
4%
100
2%
50
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
Q1 2012
Q4 2011
Q3 2011
Q2 2011
0%
20%
15.9%
15%
11.9%
10%
5%
0
0%
Q3 2012
EBIT
Q3 2013
EBIT margin
LOOK FOR A MARGIN OF 11-12% FOR 2013 AND
HIGHER MARGIN 2014 DESPITE THE WINTER OLYMPICS
22
23. PAY-TV NORDIC
VIAPLAY VOLUME & VIASAT ARPU GROWTH
PREMIUM SUBSCRIBER DEVELOPMENT (‘000)
ARPU FOR PREMIUM DTH (SEK) - ANNUALIZED
1,200
5,200
1,000
5,000
800
4,800
600
400
4,600
200
4,400
Satellite subscribers
3'rd party network subscribers
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
0
4,200
4,000
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2011 2011 2011 2012 2012 2012 2012 2013 2013 2013
OVERALL SUBSCRIBER BASE UP IF YOU INCLUDE
VIAPLAY BUT PREMIUM DTH DOWN AS ANTICIPATED
23
24. PAY-TV NORDIC
OTT OPENS UP A NEW WORLD
PC/MAC
SMART
PHONES
TABLETS
OVER THE TOP
9 MN
HOUSEHOLDS
+ VIRTUAL OPERATOR
GAME
CONSOLES
SMART TVSETS
4.2 MN
HOUSEHOLDS
TV SET-TOP
BOXES
OTT STB
DTH
1.6 MN
HOUSEHOLDS
FIRST TO MARKET DRIVEN BY AN EARLY DECISION TO HAVE A
PLATFORM AGNOSTIC APPROACH
24
25. PAY-TV NORDIC
WE ARE A LEADING PLAYER – ENABLED BY CONTENT
1st pay window
2nd pay window
25
26. PAY-TV EMERGING MARKETS
RUSSIA DRIVES GROWTH & INVESTMENTS
7% SALES GROWTH (Y-O-Y) AT CONSTANT FX
EBIT (SEK MN) AND EBIT MARGIN (%)
25%
80
25%
70
20%
60
50
15%
20%
17.9%
15%
40
10%
9.7%
30
20
5%
5%
10
0
Q3 2013
Q2 2013
Q1 2013
Q4 2012
Q3 2012
Q2 2012
Q1 2012
Q4 2011
Q3 2011
Q2 2011
0%
10%
0%
Q3 2012
EBIT
Q3 2013
EBIT margin
EXPECT TO ACHIEVE A BETTER THAN BREAKEVEN EBIT RESULT FOR FY13
WITH RISING PROFITABILITY LEVELS IN 2014
26
27. PAY-TV EMERGING MARKETS
CONTINUED STRONG SUBSCRIPTION GROWTH
SUBSCRIBERS / SUBSCRIPTIONS (‘000)
INVESTING INTO THE HD MARKET IN THE CIS
100
90
80
70
60
50
40
30
20
10
0
700
600
500
400
300
200
100
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 9m
2013
Mini-Pay subscriptions (million)
DTH ('000)
395
RUB
($13)
=
ADDED ALMOST 16 MILLION MINI-PAY
SUBSCRIPTIONS SINCE LAST YEAR TO A TOTAL OF 91 MILLION
27
28. PAY-TV EMERGING MARKETS
MARKETS DRIVEN BY PENETRATION & DIGITALIZATION
DIGITAL PAY-TV HOUSEHOLDS (MILLIONS)
IN EASTERN EUROPE
RUSSIA & UKRAINE: PREMIUM PAY REVENUES
EXPECTED TO THREEFOLD (MILLIONS USD)
35
30
24
25
30
15
12
1
2
2006
2007
10
4
6
15
300
269
250
21
20
212
200
18
161
150
9
114
100
50
8
13 20
40
65 58 64 70
WE OWN 5 OUT OF THE TOP 20 PAY CHANNELS
IN RUSSIA INCLUDING THE TOP TWO
Note: Measured by Average Monthly Reach
28
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2005
0
0
2004
5
27
322 334
350
29. STUDIOS, MTGX, RADIO
NICE TO HAVE + THE X FACTOR
Sales up 29% y-o-y at constant FX
Sales in MTG Studios up significantly driven by healthy underlying sales
growth boosted by acquisitions
Radio sales down - primarily due to Sweden
EBIT loss of SEK 46m compared to a profit of 15m last year
Healthy profitability in MTG Studios and Radio Norway
Heavy losses in Radio Sweden – restructuring ongoing
11% of Group sales
Growth (at constant FX)
2013
Jul-Sep
Sales (SEKm)
2012
Jul-Sep
297
367
-18%
29%
15
-46
5.1%
-12.5%
Investments in MTGx – expected to add up to SEK 70m of operating
costs in H2
EBIT (SEKm)
EBIT margin (excl. associates)
Agreement to acquire Nice Entertainment Group
Nordic´s largest independent group of production companies
Expected to close this month
Following acquisitions of Paprika Latino, DRG & Novemberfilm
29
30. SUMMARY
SHAPING THE FUTURE OF ENTERTAINMENT
Accelerated sales growth with balanced mix of revenues
Investments on track in content, digital and geographical expansion
Leading satellite & OTT operator + recently launched MTGx digital accelerator
Established & expanding emerging market presence in Eastern Europe & Africa
Largest shareholder in leading independent Russian TV broadcaster
High cash conversion levels, low gearing & significant available funds
Commitment to growth + shareholder returns with dividend policy to pay out >30% of recurring net income
30
31. MTG INVESTOR RELATIONS
FOR FURTHER INFORMATION, PLEASE VISIT
WWW.MTG.SE OR CONTACT:
TEL: +46 (0) 73 699 2714
EMAIL: INVESTOR.RELATIONS@MTG.SE
31
