Reach plc Preliminary Results Presentation 01.03.21

SLIDE 4 - AGENDA

Good morning and thank you for joining us for the 2020 Reach plc annual results.

Before hand over to Simon to talk us through the numbers, I want to pull out the highlights of what has been a tumultuous, but progressive year.

I will then update on the progress we’ve made against our strategy, following the data-led approach we announced last year. Lloyd Embley, our Group Editor in Chief will then join us to talk about how the editorial team are embracing our new ways of working.

After my summary, we will then take Q&A.

SLIDE 5 – KEY 2020 HIGHLIGHTS

I wanted to start by reviewing the key highlights of 2020.

This has been a year like no other, and one in which trusted news providers were relied upon for news and information like never before. It was also a year of unparalleled change for Reach, and one in which we have made significant progress in our Customer Value Strategy.

Our first strategic target was to grow registrations to over 2 million, and we have exceeded that, and gone on to break the 5 million barrier. The bulk of these registrations have signed up through our newsletters and through InYourArea.

Once a customer registers with us we are able to drive engagement, and we are seeing growth in page views per user of around 30%.

The Reach ID was launched in December. This unlocks the insights that are so key to the future strategy and digital growth. It enables us to offer commercial products that deliver increased returns to advertisers. These products will be a key focus for us this year, and I will be coming back to this area later in the presentation. We continue to grow our Live network of news sites and to deliver the first-class content that has secured our place as the No 1 news publisher in the UK in terms of monthly audience, and importantly the UK’s No 1 sports publisher.

Yes, COVID-19 impacted us, particularly in the second quarter, but we responded by radically transforming our business, giving us a stable platform to thrive over the long term. The transformative actions that we took, coupled with the resilience of our circulation, puts us in a strong position in terms of our operating margin and cash delivery. This has enabled us to restore the dividend and will continue to support our investment plans, as well as our pension obligations.

Throughout this period of change the business has continued to focus on our strategic objectives, with registrations, loyalty and engagement all improving. This contributed to our record performance in Q4, when we saw digital revenue growth of 26%.

There is still a great deal of work to be done. But we are ahead of where we expected to be. And the early results are giving us confidence in our approach.

We have now established a clear pathway to the future growth that will enable us to continue to deliver to stakeholders over the long-term.

SLIDE 6 – AN UNPARALLELED YEAR OF CHANGE

The pandemic has highlighted the importance of our core purpose as prominent champions, campaigners and change makers. Touching lives, shaping conversations and stirring emotions… our trusted brands connect people to the world. Every minute, every day.

Our people have performed exceptionally in continuing to live up to this vision during a period of intense change. They have worked harder than ever this year and have delivered outstanding journalism alongside a business performance to be proud of. I want to thank every one of them for their contribution.

The pressures of working under lockdown restrictions have provided a challenging backdrop. So we have prioritised wellbeing in our business and have invested to expand the packages available, as part of our ‘wellbeing hub’.

The pandemic has created an invisible burden of anxiety and we’re doing all we can to provide the support our colleagues need during these unsettling times.

We have also stepped up to the plate on diversity and inclusion, a key issue in our industry and one we are determined we will make a difference on.

We acted on a recommendation from our colleagues to establish a new role to drive change, and we have appointed the company’s first Head of Diversity and Inclusion. Our aim is to ensure that everyone at Reach can connect with each other, each other and thrive in an inclusive environment. We will update on progress in the months ahead.

As I mentioned earlier, we delivered the transformation – creating a more efficient organisation, with an improved operating margin.

It has accelerated our plans, and we are now moving into the next phase of our strategy.

We will continue to leverage our scale, but the focus is increasingly on engagement and loyalty, as we become a data and insight-led business.

The company’s culture is also undergoing significant change with a real focus on embracing the strategy throughout the business.

We are investing more to add to the skills in the business as well as technology – with the aim of further accelerating our progress. And once Simon has taken you through the numbers I will detail our core priorities and ambitions for Reach this year and beyond as we take the strategy forward.

SLIDE 7 - 2020 FINANCIAL UPDATE - SIMON FULLER

Thank you, Jim, and good morning everyone.

Today exactly marks my second anniversary with Reach - and as Jim has just said, whilst 2020 was an extremely demanding year for the business (and we are evidently not alone in this), it was also a year of acceleration for Reach.

As I will run through in my financial update, the business has proactively responded to the changed environment - and is now well placed to realise the full benefits of its focused strategy and efficient and scalable operating model.

SLIDE 8 - ROBUST PERFORMANCE FOR YEAR

We have described our overall financial performance as robust.

Arguably, however, this does not do full justice to the solid profitability of the group, with operating profit at £133.8m down by £19.6m (or 12.8%), which is a lower percentage decline than COVID-impacted group revenue. To put this another way, the drop in revenue was more than 80% offset through strong cost management and just over a quarter’s worth of the savings from our transformation programme.

Overall, this led to an improved operating margin of 22.3% (up 50 basis points).

Alongside this, we call out the consistently strong cash generation of Reach, with an operating cash flow of £121.8m enabling a doubling of our net cash to £42.0m.

Given this performance, the Board is recommending a final dividend of 4.26 pence per share. This return to paying cash dividends is underpinned by our confidence in the future growth trajectory of the Reach business.

SLIDE 9 - OPERATING PROFIT

On this slide, we provide a reconciliation of Operating profit, adjusted to statutory.

As you will see from the labelling, the substantial one-off costs in the year principally related to our transformation (about ⅔ of the charges) and managing historical matters (about ⅓ of the charges). Across these one-off costs, £62m was non-cash, £43m was cash impacting within the year and the remainder will flow into 2021 and beyond.

We expect a material reduction in the quantum of future adjustments, having completed the significant changes in 2020.

SLIDE 10 - GROUP REVENUE

This slide reminds us of the step downturn in total revenue in Q2, due to COVID, which impacted circulation frequency, print advertising demand, external printing volumes and also digital yields.

However, as this chart also demonstrates, Q3 and Q4 saw significant revenue progression… which led to management increasing expectations in each of September, November and January… particularly driven by Q4 Digital Revenue (and a very strong December within this).

But more on this shortly.

SLIDE 11 - PRINT REVENUE

Whilst print revenue was hardest hit by the pandemic, this was particularly true in advertising. In fact, even though, at the start of the year, print advertising was less than half of the size of circulation, it had the biggest absolute £ million drop.

Circulation, which is still over £850,000 per day was most resilient and now accounts for over ⅔ of total print revenue. This sustained performance was supported by availability investment (that is, extra copies being sent out into the network of approaching 50,000 outlets), targeted promotions (for example to encourage weekday-only readers into the weekends), and the expansion of home delivery (with tens of thousands of new subscribers added).

The long-term average circulation revenue decline is less than half that of print advertising, so the future print revenue drag will be lower due to this evolving mix.

SLIDE 12 - PRINT REVENUE BY QUARTER

This slide shows the quarterly evolution of like-for-like print revenue and we note that a significant proportion of the Q1 to Q2 additional decline had been recovered by Q4.

As can be seen from both this slide’s waterfall chart and the embedded line chart, which splits out circulation and advertising trends, Q2 and Q3 were the quarters hardest hit by COVID (Q2 in particular).

In fact, in total, two thirds of the full year decline in print revenue happened across quarters 2 and 3.

SLIDE 13 - MIX OF REVENUE

Now, before we go into the detail of our in-year digital metrics, I wanted to step back and survey a longer, six-year, horizon.

Between 2015 and 2019 Digital mix increased at an average of 2.5 percentage points per annum. In 2020, however, this doubled to a 5% mix improvement... as we moved to 1/5th of our business digital, compared to 1/20th in 2015.

Put another way, in 5 years our digital mix has quadrupled (and this is on a very similar overall group revenue, in absolute £ millions).

SLIDE 14 - STRONG DIGITAL PERFORMANCE METRICS

Jim will shortly demonstrate our progress across a number of other customer metrics, including registrations and engagement.

However, as this slide shows, measures such as overall revenue, page views and unique users have all shown very good progress too.

Our digital audience has almost trebled since 2014, supported by our national estate as well as a comprehensive stable of Live regional sites, whose coverage will further expand in 2021.

In fact, 9 out of 10 of the top regional news sites in the UK are owned and operated by Reach.

These important metrics underpin our achievement of £118m of digital revenue in 2020.

SLIDE 15 - DIGITAL REVENUE ACCELERATING

Market forces - and specifically digital advertising demand - had a sizable role to play in 2020.

At the toughest point in the year, April, our daily open market auction revenues indexed sharply downwards.

However, by September, yields and daily run-rates recovered to the start of year levels… and by December they were considerably stronger than pre-COVID, in fact they were 40% up.

This acceleration (and a record-breaking Q4) was fuelled by the Customer Value Strategy for example, increasing audience engagement through newsletters and commenting and at the exit point of the year one quarter of our business was digital.

SLIDE 16 - OPERATING MARGIN

The business is rightly proud of its track record of proactive cost control.

To reduce the total cost base of the business by almost 15% in the year, however, was a remarkable demonstration of this core competency.

Consequently, operating margins moved up again, by around 50 basis points, supported by both transformation, and importantly also the operating leverage benefits of increased digital mix.

This ratcheting effect is a critical feature of the forward narrative, as future digital mix further increases.

SLIDE 17 - TRANSFORMATION OF OUR BUSINESS MODEL

In July, with our comprehensive business model transformation, we announced an at least £35m saving from a cost of change of £20m; today we are pleased to confirm that this transformation will deliver £46m of savings at a cost of £33m providing additional firepower for our Customer Value Strategy.

The best-in-class operating efficiency of the Reach business builds confidence in our capacity to invest for future growth.

The Reach story, to be clear, is a progressive one - it is about content, customer engagement and value creation, made possible through a lean and effective operation.

To achieve this value creation, the internal Reach Investment Committee, which I chair, has signed off over 20 cases (worth over £5m) in the 2020 year. A large focus of our investment has been building internal capability, with proofs of concept, trials and experimentation each evidencing a test-and-learn mindset.

At the of this has been Reach ID, which launched in December, and is central to us having a ‘single view of a customer’.

Jim will share more on this shortly.

SLIDE 18 - STRONG ADJUSTED OPERATING CASH FLOW

My final section in this financial update reminds us of the resilience of Reach’s stand-out cash generation.

The 2020 operating cash flow of £122m was over 90% of what was achieved in pre- COVID 2019... and this not only meant that there was the cash to enable strategic investment… but net cash broadly doubled as we focused on protecting the business and maintaining its liquidity.

SLIDE 19 - CONSISTENTLY STRONG CASH CONVERSION

In fact, the cash conversion percentage (using adjusted EBITDA) has been consistently strong over a 5-year horizon and was held constant year-on-year at 76%.

This performance not only enabled the organic investment we just mentioned, but also ensured we were able to fully meet our commitments to our pension schemes (as part of our agreed recovery plan) and also fund our group-wide transformation programme.

SLIDE 20 - OUR ALLOCATION FRAMEWORK

On this slide, we reiterate our capital allocation focus, made possible by our balance sheet strength.

In the medium term, we have the opportunity to increase leverage for expansion - but the near-term focus is on organic investment and potentially smaller bolt-ons (where both our geographical reach and audience can be broadened and our Customer Value Strategy platform increased).

We remain committed to meeting our pension obligations, with the current triennial review still in progress.

Lastly, on this slide, we are also pleased to announce the resumption of cash dividends with a final 4.26 pence per share on an expanded share base, following on from our half year bonus issue.

The board recognises the importance of growing dividends for shareholders and this restoration demonstrates our confidence in the sustainability of future cash flows.

SLIDE 21 - CURRENT TRADING AND OUTLOOK

Whilst Lockdown 3, at the start of January, was a difficult message for most UK businesses, the steps taken by Reach in 2020 and a continued focus on content and customer has resulted in a broadly stable start-of-year trading for us.

Digital growth, in particular, remains over 20% and almost double the full prior year rate.

Our confidence remains, albeit tempered by macro uncertainties - and this year we expect margins to progress, investment to increase, cash dividends to continue and opportunities to be realised.

My clear message, then, is that 2020 was a year of significant progress, despite the challenging context… and provides exactly the right base for 2021 and beyond.

Let me now hand back over to Jim.

SLIDE 22 – AMBITION FOR 2020

Thank you, Simon. Our digital advertising revenues exceeded print advertising for the first time in the final quarter of 2020. In fact, we exited last year with digital revenues reaching a quarter of our total revenue for the first time.

Strategic is building. And there is much more to come in terms of improving our offer both to readers and advertisers.

This provides us with confidence in our ability to secure continued digital growth over the coming years.

Our goal is to double our digital revenue over the medium term.

By doing this, we will ensure that Reach will continue to deliver to all our stakeholders into the future.

SLIDE 23 – OUR CUSTOMER VALUE STRATEGY

Let me remind you of the four pillars of our Customer Value Strategy. We first took you through these in February last year. A lot has happened since then so we thought it worth a quick reminder!

Of course, these aren’t sequential. We continue to make progress on all of these, and they are interdependent. They summarise our overall approach and I will now take you through the key areas of focus for us in the coming year.

SLIDE 24 – AGENDA

In a moment I’ll talk you through the progress we’ve made in building engagement and how we plan to diversify our digital revenues.

I’ll then touch on our business transformation programme before handing over to Lloyd, who will give you some colour on how our editorial teams are embracing the strategy.

I will then wrap up before we take your questions.

SLIDE 25 - GROWING DIRECT TRAFFIC TO OUR DIGITAL CONTENT

Firstly, we are seeing strong growth in overall traffic to our content. During 2020 we had almost 15 billion page views in the UK across our network on web, mobile and app. This increase of around 40%, was helped by our deepening engagement with over 5 million registered customers.

One way we are achieving this, is by driving more traffic directly to our sites.

Our hyperlocal app InYourArea was the third most downloaded news app in the UK last year. The site aggregates news content and tailors it to the postcode of the reader.

It delivered an additional 92 million page views to our network and around 60% of the customers that click on these stories are registered with us.

Newsletters are also driving increased page visits.

We are now distributing around 35 million every week across 280 topics. These range from subjects like the FC newsletter to the Express politics newsletter. Together these two examples alone are now reaching 750,000 reads a week.

This additional activity is helping increase engagement and loyalty. Newsletter readers typically visit our websites around 30% more than a standard visitor.

SLIDE 26 - AND INCREASING ENGAGEMENT

To help us track our progress we are using an engagement index. This illustrates the increased page views resulting from registered customers’ activity when compared with a non-registered one. The index has already grown during 2020 and early 2021 and, while it will settle over time, as we expand our audience, it is a useful tool to monitor performance whether by title or across the group.

We continue to see strong growth in average page views per visitor – up 29% year on year, with average minutes per visitor up 32%.

And as you can see from the graph on the top right hand side our most loyal and engaged customers, such as those logging on to comment, are consuming more than seven times more pages than an average customer.

And the number of loyal customers is growing both on our leading national titles like the Mirror and across our live network – and growing faster than the overall customer base.

SLIDE 27 – CUSTOMER INSIGHT KEY TO FUTURE GROWTH

Data and insight is key to the Customer Value Strategy. With our scale audience and national, regional and local presence, we have a unique window on a customer’s media activity.

Using the Reach ID we are now able to segment our audience based on interests and content consumption. This will enable us to tailor our content to be more relevant and engaging. For example, we will use it to identify new subject areas for newsletters in order to target specific cohorts.

This will be an ongoing process. The deeper and richer insights we build, the better our ability to segment content becomes, and this enables an increasingly personalised experience for readers and advertisers.

We have made considerable progress in this area, but there is still some way to go before we develop our customer relationship management to its full potential.

We will be investing further to improve our whole approach - both in terms of people and technology. Moving forward, we want to be best in class when it comes to our data, to ensure we are operating at maximum effectiveness. This may involve working with third party experts if it accelerates our progress and we are currently engaged in discussions with potential partners.

On the commercial front, we have already made good progress in using data to offer more targeted campaigns. We carried out a number of successful trials in December, and we are seeing a lot of interest in these products from advertisers.

SLIDE 28 – HOW WE WILL GROW REVENUE PER CUSTOMER

These products will be key to how we grow digital revenues this year. The campaign products offer higher rates of returns to clients and will therefore attract higher yields than our traditional Open Market Place advertising.

While it is still relatively early days we are encouraged to have booked over half a million in revenue from these products during Q1.

I’ll now take you through each of the products starting with Audience plus.

SLIDE 29 – DEEPENING AUDIENCE SEGMENTATION

The first campaign example is from a commercial trial that took place in Q4 with a major fashion retailer. In this case, we produced a list of relevant campaign targets based on a customer’s declared interests and behaviours.

This data set selected customers who had read several fashion articles in recent weeks, and had registered for a fashion newsletter from OK! Magazine. The campaign was run across Reach titles and used our brand safety tool, Mantis, which ensures digital advertising appears alongside relevant content.

Customer response rates for using Audience plus on a number of campaigns were much higher than IP led campaigns, by up to 40%. Improved returns for advertisers means we can attract incremental advertising rates, thus increasing the value of our existing inventory.

We are in active discussions with brands in the automotive, travel, fast food and financial sectors about future campaigns and are hopeful of further pick up, particularly from onwards.

SLIDE 30 – CUSTOMER MATCHED DATA

Turning to our Customer Plus product, we are now actively matching our data with the client’s own customer information. We have now done this matching exercise with a number of brands, from gaming to retail, including for a national grocery chain using information from their loyalty card data.

This is enabling the client to develop a more targeted approach, with discrete messages for only its loyalty card holders. Our match rate was the highest they had achieved with any publisher. Campaigns could equally seek to target new customers with an offer, and exclude existing customers.

We’re encouraged by the level of interest in this product from brands and their agencies and are likely to see campaigns underway during Q2.

SLIDE 31 – HYPERLOCAL POSTCODE TARGETING

Our GEO plus product uses postcode data from customers registered on InYourArea and enables brands and businesses to direct campaigns to customers within specific locations.

We are talking to multiple brands about potential campaigns in the coming weeks.

This is adding new advertising revenue streams to InYourArea, supplementing the benefit that we were already seeing from the App in terms of registrations and direct traffic.

SLIDE 32 – NICHE SITES AND PARTNERSHIPS

We are also developing niche content areas that offer new advertising and sponsorship opportunities to brands. The first example of this is our ‘Team Dogs’ website which is set to go live shortly, offering a social network for dog owners to share tips and advice.

With pet care being one of the largest FMCG verticals and our titles reaching two-thirds of UK pet owning households, Team Dogs brings obvious commercial opportunities. We have already signed a sponsored content deal with a leading pet food brand.

Other potential partnerships we are exploring include energy switching and price comparison services and we hope to sign our first deals in H2.

We will also build on the successful pilot we ran in December with quality brewer Innis and Gunn, to explore a craft beer club opportunity with a range of regional companies. There will be an element of test and learn in these partnerships, and where we are not seeing strong customer engagement we will move on to areas with greater potential and focus only on those that deliver the best results and commercial returns.

SLIDE 33 – TRANSFORMING TO DELIVER

The progress made in 2020 has been accelerated following the transformation. We have created a highly efficient operation with all parts of the business aligned to our customer- centred goals.

I mentioned earlier that we’re becoming a data-centric business with an increasingly growth focused agenda. This extends to our editorial teams who continually look at analytics to ensure they’re informed of the stories that are gaining the biggest customer response.

Our editorial operation underwent radical change with the creation of the Reach Wire – becoming one team and removing all remaining silos. The change has meant we can now operate at much greater efficiency and protects our cherished news titles while we continue to implement the strategy.

Without the editorial focus our strategy simply could not succeed. So now you can hear how they are embracing it from Lloyd.

SLIDE 34 – EDITORIAL EMBRACING STRATEGY

Thank you, Jim,

Good morning and many thanks to you all for joining us today.

I'd like to spend a few minutes talking to you about what ultimately sits at the heart of this company - namely our content, our journalism.

As you have already seen and heard, our strategy of building deeper, closer relationships with our users and readers requires multi-divisional alignment, collaboration and delivery.

That holds firm, of course, whether we are talking about data, analytics, insight, commercialisation...

...but, at its core, it requires our journalists, our photographers and videographers, our social media experts, our headline writers, our columnists and our experts to create truly engaging content.

So how is it going?

Well, you don't need to have spent your life in journalism to know what the big story of 2020 was!

Aside from the devastating death toll, Covid has impacted every one of us and every aspect of working and domestic life...

Like many companies, we had to react and transform.

We fast-tracked the evolutionary journey we had been on.

We created a single editorial division - powered by our trusted award-winning national and local brands and underpinned by a new internal Wire service.

Every day The Wire distributes hundreds of stories around our network and crucially this is done on a timeline which allows sites to tailor stories to their particular audience.

SLIDE 35 – THE REACH WIRE

For example, Defence Editor Chris Hughes and photographer Rowan Griffiths travelled to Syria where they tracked down a Cardiff man who had been working as an Isis recruiter for seven years.

The story ran across a string of our titles in print and online including the Mirror, the Daily Star, the , the and Wales online.

All digital versions were published within minutes of one another, ensuring that we weren't just first with the news but second, third, fourth and fifth too.

The Wire works because it isn't just about sharing stories it's about fostering a culture of collaboration across our single editorial division.

As part of our transformational restructure, we created group-wide verticals in some content areas too - including sport, showbiz, fashion, beauty and travel (travel - well we can all dream).

These changes required significant structural and cultural change and it's a credit to all of our editorial staff that such a major transformation has been embraced so readily and so quickly.

And, in line with our strategy, we have built customer value metrics and KPIs into the business-as-usual flow of our newsrooms.

As Jim mentioned, we have rolled out a huge expansion of our newsletters programme - with more than 3 million people now registered. Our virtual newsrooms are now sending out almost 1,500 different newsletters every week, on subjects ranging from politics to parenting, Covid to .

That's more than double the number we sent a year ago - and the latest stats show that 9 million are being read every week.

These newsletter subscribers are so valuable because they are already around 30% more engaged than non-registered visitors and, as we roll out Reach ID, as Jim explained earlier, we will be able to supercharge our ability to monetise them.

In addition, our hyper-local In Your Area site has driven a further 2m registrations to date with its compelling mix of local news, information and services.

SLIDE 36 – AWARD WINNING JOURNALISM

Our titles also managed to win multiple awards and accolades in 2020. There are far too many for me to list them all but I'd like to give you a few highlights...

The Daily Mirror picked up Scoop of the Year, jointly with , for breaking the now infamous story of Dominic Cummings's trip to Barnard Castle The won Campaign of the Year (twice in fact) after winning approval for life- saving and life-changing treatment for cystic fibrosis sufferers

And our regional titles once again dominated the Regional Press Awards, virtually sweeping the board in digital categories, including website of the year for the Hull Live

Special mention also for the Mail which won regional Campaign of the Year after fighting tirelessly for justice for the victims of the Birmingham pub bombings

SLIDE 37 – AND SOMETHING LIGHTER TOO…

And if there were an award for the paper with most retweeted front pages in 2020 then the Daily Star would romp it.

And, of course, throughout 2020 our journalists held those in power to account - nationally and locally - and provided their audiences with trusted information, notably in relation to Covid.

Crucially, restructuring to ensure we are in the best possible shape to capitalize on the opportunities ahead hasn't prevented us from investing either....

In print we have significantly increased our availability rates and introduced a comprehensive rolling programme of cross-title promotional activity. Despite the enormous challenges of Covid, the sales of our national and regional papers have been astonishingly resilient.

It's hard to think of a sterner test of the loyalty of readers than multiple Covid lockdowns. Some observers predicted devastation, warning we would see sales losses of 50%. In fact, by of 2020, we had retained around 95% of our budgeted print sales.

SLIDE 38 – INVESTING IN OUR CONTENT

And we have continued to invest in digital journalism too

We are in the process of finalising recruitment for our expanded London website, where we have more than doubled our editorial team. Over the past year, we have launched a string of new regional Live sites, including Yorkshire, Bedfordshire, Buckinghamshire, Northants and Sussex. And in the past few months alone, we have created more than 60 new roles across our national and regional teams.

So, what does all this mean to today's audience

Well, even before our transformational restructure, we were the biggest - and I would argue comfortably the most efficiently organised - commercial publisher in the UK.

I truly believe that this new structure - with the Wire sitting underneath the entire editorial operation and our expanded range of strategic newsroom KPIs - ensures that we are better placed than any competitor to not only create but to seamlessly leverage engaging, enticing, original content.

Bring on 2021

Thank you very much for your time.

Now back to Jim

SLIDE 39 – PRIORITIES FOR 2021

Thank you Lloyd, so here are the key areas of focus for this year as we implement the next phase of the customer value strategy.

Registrations will continue to be a priority and we are already making good progress towards our target of 10m registered customers by the end of 2022.

However, we are now increasingly focussed on driving loyalty and engagement to continue to grow our share of advertising spend. We are leveraging the Reach ID and the targeted advertising it enables so that we continue to grow average revenue per user.

We will progress commercial partnerships and following a number of pilots we expect to sign our first deals during H2.

We will also continue to invest in our Live network with more sites to be launched and the expansion of existing ones as we build on their success.

SLIDE 40 – IN SUMMARY

So, to conclude:

We will step up our investment in people and technology to accelerate the customer value strategy.

The business transformation is supporting a far more efficient organisation and is enabling a stronger operating margin.

This has enabled us to return to offering a cash dividend demonstrating the confidence we have in the strength of our cashflow.

The strategy is gaining momentum and will enable us to double digital revenue over the medium term.

Thank you for listening and we will now take your questions…