Future Plc Capital Markets Day 14Th February 2019 Agenda
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Future plc Capital Markets Day 14th February 2019 Agenda 3pm Business overview & growth strategy | Zillah Byng-Thorne 3.10pm Owning a vertical - the value of leadership Vertical strategy | Aaron Asadi Audience & SEO | Sam Robson Tom’s Guide | Mark Spoonauer 3.40pm Coffee break 3.55pm The US media market & eCommerce | Michael Kisseberth Peak trading | Jason Kemp 4.20pm Future tech and the power of RAMP Evolution of our tech stack | Kevin Li Ying Ad tech | Zack Sullivan | Reda Guermas 4.45pm Investment thesis | Penny Ladkin-Brand 4.55pm Conclusion & questions | Zillah Byng-Thorne Drinks 2 Today’s speakers Vertical US Market & eCommerce Technology & Ads Zillah Byng- Aaron Asadi Michael Kisseberth Zack Sullivan Thorne Chief Content Chief Revenue SVP Sales & Chief Executive Officer Officer Operations, UK Zillah will be talking Aaron will be talking Mike will be talking Zack will be talking about how Future about the benefits of about the dynamics of about the nature of operates and our our vertical strategy the US media market programmatic growth strategy and opportunities advertising and how within eCommerce we win in this market Penny Ladkin- Sam Robson Jason Kemp Reda Guermas Brand Audience Director eCommerce VP Software Chief Financial Director Engineering Ad Tech Officer Sam will be covering how we succeed Jason will be talking Reda will be talking through search and about how we Penny will be talking about the science the value of vertical capitalise on peak about how we behind our ad tech leadership trading times succeed through stack platforms - focusing on the RAMP and Bordeaux basics and scaling up via acquisitions Mark Spoonauer Kevin Li Ying Editor-in-Chief, Chief Technology Tom’s Guide Officer Mark will be talking Kevin will be talking about Tom’s Guide about how we and how its addition continue to innovate to Future’s tech and evolve our vertical has yielded tech stack fantastic results 3 Business overview & growth strategy Zillah Byng-Thorne Chief Executive Officer Our strategy Future is a technology-enabled global platform for specialist media with scalable, diversified brands. We create fans of our brands by giving them a place they want to spend their time and where they go to meet their needs. We continue to create loyal communities. We are expanding our global reach through organic growth, acquisitions and strategic partnerships. We are diversifying our monetisation models to create significant revenue streams. 5 How we execute our strategy 4 underlying pillars facilitate operating at pace Continued diversification 1 Diversifying our audience 2 Scalable business 3 4 Ongoing investment of content monetisation New verticals ● Scalable, lean and robust ● Growth in events ● Buy and build where we ● Cycling business can add value ● Football ● Future Playbook’s at ○ organic new home ● Space heart of our processes event in Jan 2019 ● Continued investment in our technology Added B2B expertise ● Continued improvements ● Introduction of B2B ● B2B Music in eCommerce and digital business line ● Continued investment in ● B2B TV advertising ○ B2B Tech & our people ● B2B Games Creative ● 4 sites migrated to the New global audiences Vanilla website platform ● Constant innovation ● TechRadar GCC in 2018, 2 in the start of ○ Organic new site ● TechRadar Scandinavia current year launches ● Purch sites ○ New technology models 6 Our world We go where our audiences are As a result of our global audiences we operate across three continents: Europe, with offices in the UK and France; the US; and Asia Pacific with an office in Australia. Below is a summary of our locations and audience. Online Users: 13.2m (APAC) United Kingdom Australia United States ELT Members: Zillah Byng-Thorne (CEO), ELT Members: Neville Daniels ELT Members: Claire MacLellan Penny Ladkin-Brand (CFO), Aaron Asadi (MD, Australia) (MD People & Culture), Mike (CCO), Kevin Li Ying (CTO), Jason Kemp Office: Sydney Kisseberth (CRO), Christine Shaw (eCommerce Director) France Online Users: 6.1m (Aus & NZ) (MD & Snr VP B2B) Offices: Praed Mews (London), Southwark Offices: New York, Minneapolis, (London), Quay House (Bath), Offices: Paris, Grenoble Online Users: 1.4m Virginia, Utah Bournemouth, Bromsgrove Online Users: 72.8m (US & Can) Online Users: 17.8m 7 Diversifying our monetisation We have created 6 meaningful revenue streams Membership & Subs Services & Other 6.4% FY18 Proforma Revenue* Print 9.1% Advertising 8.4% eCommerce 16.3% 1st Party Display Newstrade 15.5% 14.3% Events 4.7% Creative 7.6% Solutions 17.8% Programmatic *Proforma includes full year proforma revenue for Purch 8 Diversifying our monetisation Our model is applied consistently across our verticals, with all having a mix of revenues 9 Where we operate Audience diversification through scalable sectors delivering diversified revenues Gaming & Media Audio Video Entertainment & Education Technology Music Technology Entertainment Media Technology B2B Creative & Consumer Music & Pro B2B Pro Hobbies Home interest CONSUMER Photography Technology Audio Tech 10 Vertical leadership Technology Games & Ent Music Creative & Photo Hobbies Home Interest Audience 90m consumer 37.9m consumer 16.6m consumer 3.8m consumer 36.0m consumer 1.3m consumer reach 5.3m B2B 0.7m B2B 5.3m B2B Market #1 online in UK #1 online in PC #1 UK & US music #1 online in UK #1 online in space in #1 UK home position #2 online in US gaming making mag and US US building show #1 hi-fi mag in #1 UK games mag publisher #1 UK creative & #1 UK caravanning #1 UK home UK publisher design mag mag publisher building #1 B2B US tech publisher publisher mag publisher #1 UK consumer #1 B2B US AV photography tech mag publisher exhibition Geography US +Purch, US +Purch US +NewBay +25% YoY online US +Purch +91% YoY online expansion +NewBay AU +Nextmedia audience audience AU +Nextmedia growth in US growth in US UK +Haymarket, +NewBay Vertical Audio sector Comics & Ents B2B +NewBay Launch of Football +Centaur Home expansion +Haymarket +Purch (music industry) DigitalCameraWorld +Haymarket Interest division (Newsarama) B2B +NewBay (AV, Carvanning Tech, Education) B2B +Newbay (TV & +Haymarket radio) Online market leadership measured by scale of online users within a competitive set or category in comScore; print market leadership measured by magazine circulation volume within a 11 competitive set from the Association of National Magazine Wholesalers; event market leadership measured by size of venue and volume of attendees within a competitive set. Expanding our reach through acquisitions A proven model to add value ● It is a core part of our strategy to buy and build where we identify assets where we can add value ● We take a systematic approach to all acquisitions, resulting in all transactions to date being originated in-house Phase 0 Phase 1 Phase 2 Phase 3 Pre-purchase First 4 months 4-12 months 1-2 year IDENTIFICATION INTEGRATION TRANSFORMATION OPTIMISATION Systemised identification Diligence validation Implementation of new Yield management review of long list internally revenue streams based developed Meet-and-greet all staff on Future platform New product launches model Desktop review to Management assessment eCommerce growth from understand value against and new structure in place, Global audience focus digital focus strategic filters cost savings delivered Website refreshes Review and lessons learnt Relationships with key staff Back office systems developed (often CEO to migration (Finance, IT, HR, Best practice sharing CEO) Production, Rights Mgt) Incentives review Thorough due diligence Review undertaken with financial screening 12 Vertical Extension - Cycling Our proven model allows to acquire at pace and add value 1 Diversifying our audience 2 Business overview 3 Investment case 4 Ongoing investment ● Cyclingnews - market ● Two leading brands focused ● Growth in eCommerce ● Buy and build where we leader online for on pro-cycling market via application of Hawk professional road racing can add value ● 16 staff across UK/ N ● Benefit from Future ● ● Truly global audience (34% America/Aus Migrate onto Vanilla advertising stack - Ramp using our latest US; 25% Europe; 17% UK) / Bordeaux ● Expected to be earnings technology development Flexi - low risk way to test ● Procycling magazine enhancing in Yr 1 & payback ● Content extension directly distributed in UK, <3 years our innovation and our through Future’s technology US, Aus operating model into ● In line with our acquisition mainstream cycling ● ● Licensed in key W European strategy where we see Continued investment in our people markets of Germany, opportunity to add value ● Opportunity to grow the Holland, Belgium & Italy US opportunity in time 13 Owning a vertical The value of leadership 15 Vertical strategy Aaron Asadi Chief Content Officer What is vertical leadership? ● Diversified, high-growth business in specialist markets ● New way to develop and manage strategy ● Vertical not channel-specific ● Vertical contains entire market product set ● Customer-first not product-first 16 17 17 Product-first model Product Channel Shops Subs Apps Web License Customers (From Salesforce founder, Tien Tzuo) 18 Customer-first model Events Mobile Laptop ? Shops Experiences Services Apps Subs (From Salesforce founder, Tien Tzuo) 19 Know the customer We have to know what they want in order to deliver it. At Future we rely on interaction and feedback loops to win that valuable insight. These include: ● Cross-platform reader surveys ● Online analytics ● eCommerce analytics ● Retail customer data ● Social media ●