Investor Presentation June 2009 Worldreginfo - 0Bdeb891-C7ab-4274-8336-E1376f04b321 Safe Harbour Statement
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Investor Presentation June 2009 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 Safe Harbour Statement This presentation contains written or oral forward-looking statements, including those relating to our capital needs, business strategy, expectations and intentions. Statements that use the terms “believe”, “anticipate”, “expect”, “plan”, “target”, “prospect”, “estimate”, “intend” and similar expressions of a future or forward-looking nature identify forward-looking statements for purposes of the U.S. federal securities laws or otherwise. For these statements and all other forward-looking statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy or are otherwise beyond our control and some of which might not even be anticipated. Forward-looking statements reflect our current views with respect to future events and because our business is subject to such risks and uncertainties, actual results, our strategic plan, financial position, results of operations and cash flows could differ materially from those described in or contemplated by the forward-looking statements. Important factors that contribute to such risks include, but are not limited to, the effect of the credit crisis and economic downturn in our markets as well as in the United States and Western Europe; decreases in television advertising spending and the rate of development of the advertising markets in the countries in which we operate; the impact of any additional investments we make in our Bulgaria, Croatia and Ukraine operations; our effectiveness in implementing our strategic plan for our Ukraine operations or our Bulgaria operations; the successful completion of our private placement transaction with an affiliate of Time Warner Inc.; our ability to make future investments in television broadcast operations; our ability to develop and implement strategies regarding sales and multi- channel distribution; changes in the political and regulatory environments where we operate and application of relevant laws and regulations; the timely renewal of broadcasting licenses and our ability to obtain additional frequencies and licenses; and our ability to acquire necessary programming and attract audiences. For a more detailed description of these uncertainties and other features, please see the “Risk Factors” section in our most recent Quarterly Report on Form 10-Q filed with the U.S. Securities and Exchange Commission. Forward-looking statements speak only as of the date on when they were made and we undertake no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise. Non-GAAP Financial Measures CME reports its financial results in accordance with generally accepted accounting principles in the United States (“GAAP”). However, management believes that certain non-GAAP performance measures, used in managing the business, may provide meaningful information about underlying trends in our business. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, CME’s reported results prepared in accordance with GAAP. In our presentations for each of our segments we do not reconcile Segment net revenues and Segment EBITDA that are provided in local currency to their US GAAP equivalents as the US GAAP amounts included in our financial statements are expressed in US$. 2 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 We are the leading CEE broadcaster Market, audience and brand leadership Strong local content Eighteen networks in seven markets Growing internet presence Sound balance sheet and liquidity Strong medium-term growth expectations 15 years of experience in the region Pan-regional portfolio Proxy for consumer spending growth Established market Transparency of NASDAQ and Prague listings Developing market 3 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 We are leaders in our core markets1 Leadership charts for four of our leading markets 1 January – 31 March 2009 Czech Republic - 15-54 Romania - 18-49 Urban Slovakia - 12+ Slovenia - 18-49 Time Mon Tue Wed Thu Fri Sat Sun Mon Tue Wed Thu Fri Sat Sun Mon Tue Wed Thu Fri Sat Sun Mon Tue Wed Thu Fri Sat Sun 06:00 06:30 07:00 07:30 08:00 08:30 09:00 09:30 10:00 10:30 11:00 11:30 12:00 12:30 13:00 13:30 14:00 14:30 15:00 15:30 16:00 16:30 17:00 17:30 18:00 18:30 19:00 19:30 20:00 20:30 21:00 21:30 22:00 22:30 23:00 23:30 00:00 NOVA Group CT Pro TV SA Kanal D Markíza JOJ Group POP TV + Kanal A SLO1 + SLO2 Intact Group Realitatea Media STV Sources: ATO Mediaresearch, TNS-AGB INTL, PMT/TNS SK, AGB Nielsen Media Research 4 1Core markets: Czech Republic, Romania, Slovak Republic, Slovenia and Croatia WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 Local content drives station leadership In core markets1, our leading stations have over 50% local prime time content Our stations produced 28,000 Top 20 shows in the Czech Republic - All channels March 2009 hours of fiction, news, public No. Show Channel Share (15-54) Rating (15-54) 1 Ordinace v růžové zahradě 2 (local fiction)* NOVA 54.78 21.5 affairs and entertainment in 2 Medvídek (movie) NOVA 58.35 21.5 3 Televizní noviny (News)* NOVA 63.94 21.0 2008. 4 Sportovní noviny (sports news)* NOVA 61.83 20.5 5Výměna manželek (reality show)* NOVA 46.33 18.5 6Počasí (weather news)* NOVA 54.32 18.1 We develop and produce original 7 Comeback (local fiction)* NOVA 50.40 17.8 drama, sitcoms, soaps, 8Kameňák 3 (movie) NOVA 49.37 16.2 9Strěpiny (Local curent affairs)* NOVA 47.61 16.2 telenovelas and TV movies. 10 Pán domu (comedy action movie) NOVA 45.65 15.8 11 Next (movie) NOVA 46.22 15.5 12 Vikěnd (current affairs)* NOVA 45.24 15.4 Our local content outperforms 13 Kameňák (movie) NOVA 48.05 15.0 14 Mission Impossible 3 (movie) NOVA 43.21 14.8 acquired programming and 15 Proč bychom se netopili (movie) ČT1 37.60 14.7 16 Kameňák (movie) NOVA 47.39 14.6 strengthens our library. 17 Ďáblova lest (movie) ČT1 33.87 14.1 18 Kriminálka New York (series) NOVA 43.25 13.0 19 Druhá šance (reality show)* NOVA 39.56 12.4 20 Ulice (local fiction)* NOVA 46.39 12.1 Source: ATO Mediaresearch. For daily and weekly shows the audience shares and ratings are averages for the whole month. * Produced by TV Nova 1 Czech Republic, Romania, Slovakia and Slovenia and Croatia 5 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 Leadership generates strong power ratios 2008 All Day Audience Share and Revenue1 Share 1.9x 1.9x 1.7x 2.3x 1.6x 1.4x Audience Share x Power Ratio = Revenue Share Sources: Audience share data: Croatia, AGB Nielsen Media Research; Czech Republic, ATO Mediaresearch; Slovak Republic, PMT/TNS SK ; Slovenia, Peoplemeters AGB Media Services; Romania, Peoplemeters Taylor Nelson Sofres and Ukraine, Peoplemeters GFK USM. Revenue share: CME Segment Revenue data and CME estimate of Segment market size. 1 Advertising revenues including spot revenue and sponsorship. 6 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 We are growing leadership in internet 1.8 million average daily unique users at end of March 2009 - 102% growth since 2008 1.6 million video downloads and streaming at end of March 2009, 73% growth year on year Collaboration with Microsoft in Slovenia and Croatia to cross-promote our websites Bulgarian operations became first in the market to launch live sport streaming, driving traffic Leadership in Romania and Slovenia in terms of unique users Acquisition of Launch of Catch up TV All CME Jyxo and Blog.cz in Czech Republic Launch of tn.cz Romanian news websites drive traffic Holiday period Unique users (m) Unique users 2008 2009 Source: Gemius 7 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 TV is a stronger advertising medium in our markets Breakdown of total advertising spend in 2008 Other Internet Radio Outdoor Print TV 100% 80% 60% 40% 20% 0% Romania Slovenia Bulgaria Croatia Slovak Czech Ukraine CME Western Source: Group M Republic Republic countries Europe At December 31, 2008 exchange rates Western Europe: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the UK. 8 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 Advertising intensity is still low Total advertising spend / GDP in 2008 0.8% 0.7% 0.6% 0.5% 0.4% 0.3% 0.2% 0.1% 0.0% Slovenia Romania Slovak Czech Croatia Ukraine Bulgaria CME Western Source: CME estimates, Group M, Global Insight Republic Republic countries Europe At December 31, 2008 exchange rates Western Europe: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the UK 9 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 Ad spend per capita has significant growth headroom Total advertising spend per capita in 2008 300 $290.9 250 200 150 $108.2 100 $83.8 $88.5 $73.0 $46.7 50 $36.3 $43.6 $22.5 0 Ukraine Romania Bulgaria Croatia Slovak Slovenia Czech CME Western Republic Republic countries Europe Source: CME estimates, Group M, Global Insight At December 31, 2008 exchange rates 10 WorldReginfo - 0bdeb891-c7ab-4274-8336-e1376f04b321 Increase in high-end ads fuels growth Pro TV, Acasa, TV Nova, Studio UK TV Pro Cinema, Pop TV, TV2, Advertiser Portfolio Nova Sport, TV Markíza Nova TV 1+1, Market Sport.ro, Kanal A Ring TV Nova Cinema Kino MTV Romania Slovak Czech Slovenia Bulgaria Romania (EU) Republic Croatia Ukraine Republic (EU) (EU) (EU) (EU) Finance, Automotive, Entertainment, 49% 29% 22% 37% 29% 38% 11% 29% Media, Leisure, Travel, Transport & Distribution Food, Telecoms, Cosmetics, Toiletries, 43% 63% 77% 62% 69% 60% 84% 48% Household & Cleaners 8% Other 8% 1% 1% 2% 2% 5% 23% 100% 100% 100% 100% 100% 100% 100% 100% Source: UK TV Market World Advertising Research Center (Marketing Pocketbook) and CME estimates (2008).