Sony Pictures Television

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Sony Pictures Television SPT Business Overview November 16, 2012 DRAFT – FOR DISCUSSION ONLY 1 Sony Pictures Television Business Overview Sony Pictures Television Distribution & Ad Production Networks Sales • Development, acquisition, • Distribution handles the sale • Management and distribution and production of television of SPE’s film and television of branded networks and programs for broadcast, basic content to television and channels worldwide cable, and premium cable digital customers networks • International brands include • Ad sales handles inventory AXN, SET, and Animax • Program genres include and integration opportunities scripted comedies and in SPT’s syndication series, dramas and non-scripted SPE’s digital businesses in the reality, talk, and game shows US – including Crackle, and PlayStation 2 SPT Organization Overview Steve Mosko President, Sony Pictures Television Andy Kaplan Andrea Wong John Weiser Michael Davies President, Worldwide President, Int’l President, Distribution President, Embassy Row Networks Production Corii Berg Harry Friedman Zack Van Amburg Jamie Erlicht Sr. EVP, Production Executive Producer President, Programming President, Programming Business Affairs Amy Carney Chris Elwell Sheraton Kalouria Keith LeGoy Paula Askanas President, Ad Sales, EVP, Distribution Business EVP and Chief Marketing President, Distribution EVP, SPT Communications Strategy & Research Operations Officer 3 What We Do Well, Where We Need Improvement- U.S. Production What we do really well What we need to work on • Consistently strong pilot orders, pilot to series • Keeping existing series on air. Would be helped conversions and series renewal rates greatly by having a U.S. network • Launch and monetize cable dramas • Breakout hit: broadcast comedy or procedural • Strong growth of series on air on a small • Increase investment in writers and development development budget • Collaborate better with international production in development/exploitation of scripted and unscripted formats • Lead assertively in control of production costs and in improving series economics vis-à-vis network buyers 4 What We Do Well, Where We Need Improvement- International Production What we do really well What we need to work on • Expanding footprint of international production • Breakout hit format businesses • Achieve scale and pipeline in major format • Early footholds in growth markets (e.g., Russia, generating territories (UK, Netherlands, LATAM) Scandinavia) • Increasingly streamlining production administration and collaboration within and across territories 5 What We Do Well, Where We Need Improvement- U.S. Distribution and Ad Sales What we do really well What we need to work on • Good at building and a product-centered approach to • [to come from Steve] distributing TV and movies: customized release plans and windowing across platforms for different types of TV series and features • Strong sales planning, forecasting, analytics and business affairs. • Strong collaboration across SPT groups and SPE divisions – ensuring that Distribution deals support and are coordinated with Networks carriage deals; leveraging TV deals for home video deals where clients are in both businesses; repping inventory for PlayStation • Have integrated program and format sales in international markets • Strong syndication sales/ad sales organization compared to others in market • Leverage traditional TV ad sales along with digital inventories/platforms (FearNet, PlayStation) 6 What We Do Well, Where We Need Improvement- International Distribution What we do really well What we need to work on • Strong output agreements for film and TV • Improve and streamline marketing, business affairs, planning and admin support • Close integration with U.S. Production compared to competition • Leverage across media/lines of business with large consolidated buyers on behalf of transactional, SVOD and traditional TV • Collaborate on transactional businesses with SPHE 7 What We Do Well, Where We Need Improvement- Networks What we do really well What we need to work on • Strong record of launching new channels, • Stronger network brand and programming moving early in growth markets identities for existing channels • Strong EBIT margin and growth trajectory • Increase investment in U.S. market for a flagship network (e.g., merge with AMC) • Establishing Crackle as a market leader in its category • Increase investment in new channels in international growth markets (e.g., Indian regional channels, Middle East) and select mature markets (e.g., Italy movie channel; SET Germany) • Digital strategy – build a bouquet of digital networks 8 Note: Distribution EBIT discussion not provided as it is largely a pass through Television Business is Growing SPT EBIT continues to grow at a rate of 15% year-over-year SPT Consolidated EBIT • Networks – Networks has an EBIT CAGR of 23% across $MM Monetization the plan, breaking earnings records in each and every $859 900 year. The growth comes from all regions across the world as newer channels mature to profitability and $765 800 more mature channels grow or maintain their margins 700 $625 • U.S. Production & Ad Sales– EBIT grows 21% over the $564 plan from $290MM to $351MM driven by a steady 600 pipeline of programming sold to SVOD and Off-net 11 syndication: Last Resort, Happy Endings, Justified 500 553 • International Production – International Production 400 has an EBIT CAGR of 78% across the plan. Moderate 300 organic growth from existing operating companies is supplemented by EBIT contributions from recent 200 acquisitions Left Bank and Silver River as well as the inclusion of a hit format starting in FY15 100 0 FY13 FY14 FY15 FY16 Frcst Current Current Current 9 Sony Pictures Television Revenue and EBIT – Today and Tomorrow Gross Revenue Net revenue EBIT ($MM) FYE13 FYE16 FYE13 FYE16 FYE13 FYE16 U.S. Distribution 778 632 48 40 34 25 Int'l Distribution 1,630 1,895 9 5 (45) (54) Int'l Production 233 513 294 573 6 34 U.S. Production & Ad Sales 1,058 1,450 1,761 2,191 290 351 Networks 1,518 2,482 1,536 2,580 268 503 Total $ 5,217 $ 6,972 $ 3,648 $ 5,389 $ 553 $ 859 ($MM) ($MM) $8,000 Revenue $1,000 EBIT $7,000 $900 $6,972 $6,000 $800 $859 $700 $5,000 $5,217 $5,389 $600 $4,000 $500 $553 $3,000 $3,648 $400 $2,000 $300 $200 $1,000 $100 $- $- FYE13 FYE13 FYE16 FYE16 FYE13 FYE16 Gross Net Gross Net 10 Note: EBIT excludes monetization of $11MM in FY13 and 3NET EBIT of ($6MM) in FY13 and ($2MM) in FY16. U.S. Production 11 U.S. Production: Forecast Strong and Consistent Earnings Growth Revenue EBIT ($MM) Current Series, Pilots & Development Costs Wheel of Fortune, Jeopardy! and Daytime Drama 500 180 1,600 120 167 450 155 113 151 144 160 1,400 101 100 400 140 1,200 350 120 80 1,000 78 300 68 100 800 60 250 1,500 80 200 411 429 1,289 1,352 402 397 600 60 1,144 40 150 400 100 40 20 200 50 20 - - - - FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16 Embassy Row Library & All Other Product 90 9 180 85 8 81 80 8 78 77 80 7 175 76 70 7 75 6 170 70 60 5 6 65 50 5 165 60 40 83 4 76 174 160 55 30 3 53 164 163 50 20 2 155 159 33 45 10 1 150 40 - - FY13 FY14 FY15 FY16 FY13 FY14 FY15 FY16 12 U.S. Production: Organization Overview Steve Mosko President, Sony Pictures Television Jamie Erlicht Zack Van Amburg President, U.S. President, U.S. Programming Programming Holly Jacobs Suzanne Patmore Gibbs Glenn Adilman Dawn Steinberg EVP, U.S. Reality & EVP, U.S. Drama EVP, U.S. Comedy & EVP, U.S. Talent & Casting Syndication Programming Development Animation Steve Kent Kim Rozenfeld Helen Verno Ed Lammi Sr. EVP, U.S. Format EVP, U.S. Current EVP, U.S. MOWs / Minis EVP, U.S. Production Production Programming 13 • Community sold to SVOD and Cable SPT Timeline: 2005 – 2012 • Rules sold in syndication in 97% of U.S. • SPT achieves 39 Emmy • 7 shows on 2011 primetime fall schedule (most since 2002) nominations (excluding Wheel of Fortune, Jeopardy!, Days of Our Lives, • SPT has broadcast programming on 6 of 7 nights of the 2011 • 4 new series premiering on all 4 Young & The Restless) fall schedule major broadcast networks • Highest volume year in SPT history with 13 stand-alone profitable series • Three primetime broadcast reality series • Rules of Engagement • SPT has more new broadcast comedy series than becomes primetime’s any other studio #2 comedy 25series • SPT becomes the #1 • The Shield becomes 24 series producer of scripted SPT’s first cable-to- cable series cable series sale; • SPT successfully launches Dr. Oz 22 Mob Doctor • SPT achieves 29 Emmy $32MM • Rescue Me sells into U.S. syndication and has an ultimate profit of $55MM nominations series Charlie’s Angels Last Resort Pan Am Made In Jersey Happy Endings Unforgettable Save Me • Only studio to get a 17 Mad Love Necessary The Job new series on each of 17 17 series Mr. Sunshine Roughness Men At Work the 5 broadcast series Breaking In Re-Modeled Masters of Sex networks series 16 Plain Jane Substitute Client List series Canterbury’s Law Breaking In Pyramid Sit Down, Shut Up Brothers The Big C Cashmere Mafia Franklin & Bash Franklin & Bash The Unusuals Community Franklin & Bash Big Day Power of 10 Happy Endings Happy Endings The Beast Shark Tank Nate Berkus Heist Spider-Man The Big C The Big C Newlywed Game The Sing-Off Community Kidnapped Viva Laughlin Rules of Nate Berkus Necessary 11 Judge Karen Drop Dead Diva Rules of Breaking Bad Engagement Community Roughness Rules of Hawthorne series Engagement Damages Shark Tank Community Engagement Justified Rules of Runaway Judge David Young The Sing-Off Engagement Rules of Spider-Man Make My Day Book of
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