Religare - India Select Opportunities Conference February 11, 2010 Mumbai
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Disclaimer
Certain statements in this release concerning our future growth prospects are forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in our business segments, change in governmental policies, political instability, legal restrictions on raising capital, and unauthorized use of our intellectual property and general economic conditions affecting our industry. ENIL may, from time to time, make additional written and oral forward looking statements, including our reports to shareholders. The Company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the company.
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Presentation Path
• Times Group • Indian Media Industry • ENIL Overview – Radio Mirchi – Times OOH – 360Degrees • Financial Highlights
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Times Group
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Corporate Structure
Bennett Coleman & Co. Limited
Publishing Division Times Internet Times Global Private The Times of India Limited Broadcasting Treaties The Economic Times Navbharat Times indiatimes.com News Channel – Maharashtra Times Times 58888 Times Now Sandhya Times Infotainment Business News Times of Money Vijay Times Media Limited – ET Now Zoom Entertainment & Retail Entertainment Times Music Network TIML Global Ltd. Mirchi Movies Ltd. Mopix Animation Ent. Channel – Zoom Times Wellness Times Multimedia World Wide Entertainment Media Network (India) (JV with BBC) Limited Times Business Femina Solutions Ltd. Radio Mirchi Filmfare Top Gear Timesjobs.com Grazia SimplyMarry.com Others Magicbricks.com TIM ABSIL Times OOH 360Degrees
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ENIL Overview
Our Vision is to be “A Leading City-centric Media Company By Delivering Unique Audiences Through Media Vehicles Like FM Radio, Experiential Marketing And Out-of-home Media”
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Company Snapshot
Headquarters: Mumbai, India
Incorporated: 1999
Listed: February 15, 2006
Subsidiaries: Times Innovative Media Limited (TIM) Alternate Brand Solutions (India) Limited (ABSIL) Businesses: – ENIL Radio Broadcasting brand - Radio Mirchi – TIM Out-of-home Media brand - Times OOH – ABSIL Experiential Marketing brand - 360 0 Experience FY09 Consolidated Total Rs. 4,270.9 mn, including other income of Rs. 8.6 Income: mn FY09 Consolidated EBITDA Rs. 83.2 mn Loss:
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ENIL: Building an ‘emerging media’ network
• Comprehensive emerging media Company Structure offering Company Business Brand
Flagship company of – Network of emerging media (radio, BCCL “The Times of India” group
OOH & event management) 100% • Radio: India’s leading private FM radio network - with 32 stations TIML
under the Radio Mirchi brand 64.2% 7% • OOH: Largest organized OOH Radio: India’s largest Pvt FM network player in India with a formidable ENIL Broadcasting Activations portfolio of contracts including the
Delhi & Mumbai international Out Of Home Media 83.45% Airports airports TIM Street Furniture Billboards • Event Management : Executing big- ticket events; developing own events Events and Promotion – Ford Super Models, Smart Living 100% Life Style & Entertainment ABSIL Conferences Awards, Miss Teen Diva, Mr. India Corporate Events (World) etc.
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Indian Media Industry
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Radio expected to outperform ad industry growth
Rs. In Billion % share in % share in CAGR Industry Segment CY08 Ad industry CY09E Ad industry Growth 2009-2013 Print Media 103.5 47.9% 111.5 47.3% 7.7% 8.0% Television 84.2 39.0% 91.0 38.6% 8.1% 12.2% Radio 8.3 3.8% 9.8 4.2% 18.1% 18.0% OOH Media 15.0 6.9% 16.0 6.8% 6.7% 10.8% Online Advertising 5.0 2.3% 7.5 3.2% 50.0% 32.0%
Total 216.0 100.0% 235.8 100.0% 9.2% 11.1% Source: PWC – Indian entertainment and media outlook July 2009
− Radio ad spends expected to double − OOH media growth expected to be in line with ad industry
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FM Radio - Evolution
2006- 07 • Multiple Frequency • License Tradability • Networking 1999-2005 • Radio ad spend share • Completion of Phase – - 8.5% II Licensing • Technology Before 1999 • Increased Competition developments • Phase – I Licensing • Improving profitability • Internet Radio • Limited Private Participation • Growth in radio ad spend • Strict Regulatory norms Radio in growth phase • No privatisation • Government Run radio • Introduction of revenue sharing in 2005 2008 Channel Radio in infancy Radio a “dead industry”
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FM Radio – Draft Phase 3 Policy
• Additional channels in the same city to existing players – At least three players excluding AIR in any city – Maximum number of channels to a radio operator not more than 40% of total channels in the city • News and Current affairs on FM Radio may be permitted • FDI /FII limit to 26% from present 20% for news radio channels and 49% to non-news radio channels • Change in ownership or further dilution shall be permitted after a period of three years from the date of operationalisation • Networking of FM radio programs across the radio network • First Right of Refusal to existing radio operators for renewal of the radio license
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Radio Mirchi
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Mirchi – Presence across Key Indian Cities
Ahmedabad Jallandhar Pune
Aurangabad Kanpur Panjim
Bangalore Kolhapur Raipur
Bhopal Kolkata Rajkot
Chennai Lucknow Surat
Coimbatore Madurai Vadodara
Delhi Mangalore Varanasi
Hyderabad Mumbai Vijayawada
Indore Nashik Vishakhapatnam
Thiruvananthapuram Jabalpur Nagpur
Jaipur Patna Market Leader in Indian Private FM Radio Industry
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Innovative Content & Experience in managing diverse markets
• Innovative Content: – Strong relationships with Hindi, Tamil , Telugu, Kannada, Malayalam and Bengali film fraternity – Unique shows with participation of popular filmstars – Dedicated Bollywood shows – Mature research culture – music/listenership
• Success in Diverse Markets – Experience in establishing superior linkage between Marketing and Programming – Customized content in 10 distinct languages
• Consistent Market Share of over 40%
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Strong Brand
• Listeners: – As per the Radio Audience Measurement (RAM) data, Radio Mirchi is leader in Delhi, Mumbai, Kolkata and close #2 in Bangalore – As per the recently published Indian Readership Survey (IRS) 2009 R2, Radio Mirchi has emerged as a clear leader with over 41 million listeners across the country – Radio Mirchi tops the charts with the largest cumulative listenership of 15.4 million in the eight key cities of Mumbai, Delhi, Kolkata, Hyderabad, Bangalore, Pune and Ahmedabad. It leads in 25 of its 32 cities across the country
• Media buyers: – Category building initiatives – Mirchi Music Awards – Mirchi Kaan Awards – Radio works – Other innovations: – One-sec billing – Offering studio facilities for jingle production
• In the Pitch-IMRB survey - October 2008, Mirchi was declared #1 media brand in the country – ahead of reputed brands like Times of India, Star Plus and Sony TV channel • In the recent Brand Reporter issue Mirchi was declared as one of the 50 game changers along with ICICI Bank, Pantaloon, Maruti, Reliance Communications etc
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Revenue Trends
70.0 63.3 50.0% 61.6 60.0 57.2 60.0 55.9 40.0% 39.5% 50.3 50.2 50.0 30.0% 20.0% 40.0 10.0% 30.0 15.0% 6.0% 0.0% 20.0 (10.0%) (22.7%) (9.2%) 10.0 (11.5%) (12.2%) (20.0%) - (30.0%) Q1FY09 Q2FY09 Q3FY09 Q4FY09 Q1FY10 Q2FY10 Q3FY10
Revenues (Rs. Cr.) Growth Rate (YoY)
• Revenue growth is resumed
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Times OOH
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Presence in Key OOH Markets
Presence in key geographies – Largest organized player City Contracts
Mumbai Mumbai International Airport Ltd (MIAL) 1,300 bus queue shelters – Formidable portfolio of OOH assets Patel Bridge
in key cities Delhi Delhi International Airport Ltd (DIAL) Delhi-Noida-Delhi Flyway • Mix of long and medium term lease Delhi Metro Rail Hyderabad 200 bus queue shelters + EMR for flyovers on tendered properties Bangalore 281 + 132 (EMR) bus queue shelters • Includes key assets in high Presence in all segments traffic/footfall areas Revenue Margin Capex
Airports, metros, Moderate Moderate – Customized solutions through new Transit High bus-backs, taxis technologies - video walls and Street Bus queue Moderate High High remote-access hoardings Furniture shelters, kiosks Static, digital, Moderate Moderate Moderate Billboards mobile
Moderate Alternative Others High High
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Evolution Path
2009
2008
Introduced LEDs in India 2007 Won Patel Bridge, Dwarka Metro, DND Flyover & Year of consolidation Kolkata Billboards Investment by Goldman 2006 Sachs and Lehman Brothers TIM is Expanded into Bangalore, incorporated and Won Delhi and Hyderabad, Chandigarh & business is Mumbai Airport Jaipur Foray in OOH transferred from Won Pune Exclusive marketing business with TIML Billboards arrangement in Bangalore, Mumbai BQS Two long tenure Hyderabad and Delhi contract contract renewals 2005 Metro (DND, Mumbai Renewal - Patel Bridge BQS) 2002 Contract London office New verticals Trading Retail
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Opportunity Landscape
MATURE GROWTH
Kolkata Chennai Mumbai Delhi Hyderabad Bangalore
Jaipur, Chandigarh Kochi Kanpur, Vadodara, Pune Jallandhar, Kolhapur
% share totalof Spend Indore Surat, Coimbatore Nagpur Ahmedabad, Lucknow LOW HIGH SLOW GROWTH EMERGING
LOW HIGH % Growth Chennai, Delhi and Bangalore lead the growth opportunities; Tier II cities show a lot of promise
Source GroupM data 21
21 Competitive Landscape
Global players Competitor Property
JC Decaux BIAL , New Delhi BQS
Clear Channel Laqshya HIAL , Dubai BQS , Billboards
Indian players Big Street Bangalore LED & BQS
Clear Channel DMRC , Mumbai Gantries
Jagran Engage Jindal Steel New Delhi, Amritsar BQS
Pioneer
BigStreet
Roshan publicity
Top 10 players have less than 30%22 market share
22 Recent Developments
• Strong sequential revenue growth of 17.1% in Q3FY10
• BFSI remains the top client category; increased contribution from FMCG, Real Estate and IT-ITES
• Won the court case on advertisement rights contract awarded by BEST to Times OOH for a 15 year period in respect of approximately 1300 Bus Shelters in Mumbai & its Suburbs − The Hon’ble Supreme Court pronounced the judgment in favour of BEST to the effect that Times OOH shall continue to operate the existing contracts for the period of term of 15 years i.e. up to 2022
• Favourable structural changes augur well for the profitability of the OOH Media business
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360Degrees - ABSIL
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Alternate Brand Solutions (India) Ltd.
“Business of Ideas ”
Creative Property Ownership Solutions Driving Sustainability
“Preferred Corporate Partner” Innovation in execution
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Event Management Industry - Segments
Industry Size of Rs.1,600 crores
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Industry Landscape
• Highly fragmented industry – more than 5000 players • Largely unorganized - less than 10% players have a full fledged set up • Very few Corporate Players : Less than 1% players are Corporate • Diversifying revenue stream – Creating IPRs – TV Content Production • Organized players’ operating history: 6 – 10 years
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360° Experience: Eventful Consumer Engagements
• Focus on owned properties – Techlife Awards – Ford Super Models, India – Teen Diva Beauty Pageant – Smart Living Awards – Mr. India World pageant – Spelling Bee • Managing large format events – Filmfare Awards – Miss India Beauty Pageant • Key strengths – National presence – Experienced team of professionals – Large bouquet of in-house events • Geared for profitable growth
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Financial Review
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Condensed Statement Of Operations Standalone
%age of %age of (Rs. Million) Q3FY10 Total Income Q3FY09 Total Income Growth (%)
Income from Operations 633.3 99.7% 597.4 99.6% 6.0% Other Operating Income 2.0 0.3% 2.2 0.4% (11.7%)
Total Income 635.2 100.0% 599.7 100.0% 5.9% Operating Expenditure 424.2 66.8% 416.2 69.4% 1.9%
EBITDA 211.0 33.2% 183.4 30.6% 15.0% Depreciation 37.2 5.9% 44.1 7.4% (15.6%) Amortisation 56.7 8.9% 56.7 9.4% 0.0%
Interest 10.9 1.7% 28.9 4.8% (62.3%) Other Income 0.9 0.1% 0.3 0.1% 199.0%
Profit Before Tax (PBT) 107.2 16.9% 54.1 9.0% 98.1% Less: Taxation (0.2) (0.0%) 5.5 0.9% NM
Profit After Tax (PAT) 107.4 16.9% 48.6 8.1% 120.8%
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Condensed Statement Of Operations Standalone
%age of %age of (Rs. Million) 9MFY10 Total Income 9MFY09 Total Income Growth (%)
Income from Operations 1,691.7 99.7% 1,780.7 99.6% (5.0%) Other Operating Income 5.1 0.3% 6.6 0.4% (23.2%)
Total Income 1,696.8 100.0% 1,787.3 100.0% (5.1%)
Operating Expenditure 1,248.8 73.6% 1,414.9 79.2% (11.7%) EBITDA 448.0 26.4% 372.4 20.8% 20.3%
Depreciation 109.5 6.5% 132.5 7.4% (17.4%) Amortisation 169.4 10.0% 168.6 9.4% 0.4% Interest 41.3 2.4% 78.2 4.4% (47.2%) Other Income 2.6 0.2% 11.2 0.6% (76.7%) Profit Before Tax (PBT) 130.5 7.7% 4.3 0.2% 2922.1%
Less: Taxation (0.6) (0.0%) (12.2) (0.7%) NM
Profit After Tax (PAT) 131.0 7.7% 16.5 0.9% 692.3%
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Q3FY10 - Financial Performance (All comparisons with Q3FY09)
• On a sequential basis revenues grew by 13.6% and EBITDA up 45.8%
• Legacy 10 radio stations performance: - Total Income Rs. 466.4 million, up 4.7% - EBITDA of Rs 177.1 million, up 5.2% - EBITDA margin stood at 38.0% vis-à-vis 37.8%
• 22 new stations’ revenues grew by 9.6%
• Admin expenses include a provision of Rs.30.8 million for Private Treaty revenues
• Admin expenses include a one-time charge of Rs.6.1 million
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Condensed Statement Of Operations Consolidated
%age of %age of (Rs. Million) Q3FY10 Total Income Q3FY09 Total Income Growth (%)
Income from Operations 1,165.8 99.8% 1,101.2 99.8% 5.9%
Other Operating Income 2.0 0.2% 2.2 0.2% (11.7%)
Total Income 1,167.7 100.0% 1,103.5 100.0% 5.8% Operating Expenditure 992.0 84.9% 1,044.5 94.7% (5.0%)
EBITDA 175.8 15.1% 59.0 5.3% NM Depreciation 81.1 6.9% 76.9 7.0% 5.5%
Amortisation 56.7 4.9% 56.7 5.1% 0.0%
Interest 30.1 2.6% 48.9 4.4% (38.5%)
Other Income 1.3 0.1% 0.5 0.0% 182.7%
Profit Before Tax (PBT) 9.3 0.8% (123.0) (11.1%) NM Less: Taxation (0.2) (0.0%) 14.5 1.3% NM
Profit After Tax (PAT) 9.4 0.8% (137.5) (12.5%) NM Minority Interest (15.6) (1.3%) (30.7) (0.03) NM Net Profit after Minority Interest 25.0 2.1% (106.8) (9.7%) NM
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Condensed Statement Of Operations Consolidated
%age of %age of (Rs. Million) 9MFY10 Total Income 9MFY09 Total Income Growth (%)
Income from Operations 3,020.2 99.8% 3,266.7 99.8% (7.5%) Other Operating Income 5.1 0.2% 6.6 0.2% (23.2%)
Total Income 3,025.3 100.0% 3,273.3 100.0% (7.6%) Operating Expenditure 2,922.2 96.6% 3,243.7 99.1% (9.9%)
EBITDA 103.1 3.4% 29.6 0.9% NM Depreciation 237.8 7.9% 224.4 6.9% 6.0%
Amortisation 169.4 5.6% 168.6 5.2% 0.4%
Interest 92.7 3.1% 109.0 3.3% (14.9%) Other Income 3.7 0.1% 16.7 0.5% (77.7%)
Profit Before Tax (PBT) (393.0) (13.0%) (455.7) (13.9%) NM Less: Taxation (4.6) (0.2%) (17.3) (0.5%) NM
Profit After Tax (PAT) (388.5) (12.8%) (438.5) (13.4%) NM Minority Interest (81.1) (2.7%) (69.6) (2.1%) NM Net Profit after Minority Interest (307.4) (10.2%) (368.9) (11.3%) NM
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Consolidated Financial Performance Q3FY10
Inter Co. Rs. Million ENIL TIM ABSIL Adjustments Consolidated Income from Operations 633.3 427.6 108.3 (3.4) 1,165.8 Other Operating Income 2.0 - - - 2.0 Total Income 635.2 427.6 108.3 (3.4) 1,167.7 Expenditure Production Expenses 54.8 23.1 64.5 (1.9) 140.5 License Fees 32.5 322.0 - - 354.5 Other Operating Expenses 336.9 114.4 47.1 (1.5) 496.9 Total Cost 424.2 459.5 111.7 (3.4) 992.0 EBITDA 211.0 (31.8) (3.4) 175.8 Margin (%) 33.2% (7.4%) (3.1%) 15.1% Interest (Net) 10.9 19.2 (0.0) - 30.1 Depreciation & Amortisation 93.9 43.4 0.9 (0.5) 137.8 Other Non-Operating Income 0.9 0.3 0.1 - 1.3 Profit / (Loss) Before Taxation 107.2 (94.2) (4.2) 0.5 9.3 Taxation (0.2) - - - (0.2) Profit / (Loss) Before Minority Interest 107.4 (94.2) (4.2) 0.5 9.4 Minority Interest (15.6) (15.6) Profit / (Loss) after Minority Interest 107.4 (78.6) (4.2) 0.5 25.0
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Consolidated Financial Performance 9M FY10
Inter Co. Rs. Million ENIL TIM ABSIL Adjustments Consolidated Income from Operations 1,691.7 1,101.5 241.5 (14.5) 3,020.2 Other Operating Income 5.1 0.0 - - 5.1 Total Income 1,696.8 1,101.5 241.5 (14.5) 3,025.3 Expenditure Production Expenses 164.9 65.5 158.8 (2.1) 387.1 License Fees 87.5 1,016.1 - - 1,103.6 Other Operating Expenses 996.4 332.0 115.4 (12.4) 1,431.4 Total Cost 1,248.8 1,413.7 274.2 (14.5) 2,922.2 EBITDA 448.0 (312.1) (32.7) 103.1 Margin (%) 26.4% (28.3%) (13.5%) 3.4% Interest (Net) 41.3 51.8 (0.3) - 92.7 Depreciation & Amortisation 278.8 126.4 3.3 (1.4) 407.1 Other Non-Operating Income 2.6 1.0 0.1 - 3.7 Profit / (Loss) Before Taxation 130.5 (489.3) (35.6) 1.4 (393.0) Less: Taxation (0.6) 0.1 (4.1) - (4.6) Profit / (Loss) Before Minority Interest 131.0 (489.5) (31.5) 1.4 (388.5) Minority Interest (81.1) (81.1) Profit / (Loss) after Minority Interest 131.0 (408.4) (31.5) 1.4 (307.4)
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Q3 FY10 - Consolidated Financial Performance (All comparisons with Q3FY09)
• Times OOH revenues heading towards pre-meltdown period revenues, YoY growth of 7.5% − Sequential revenue growth - 17.1% • Normalised EBITDA loss down to Rs.17.2 million from Rs.141.1 million in Q2 • Event Management business revenues down 16.3% – Revenues were down due to change in business structure – Reported sequential growth of 63.6% • Consolidated admin expenses include a provision of Rs.58.3 million for Private Treaty revenues
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THANK YOU
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