VGI Global Media Plc
2015/16 Earnings Presentation 16 May 2016
Investment involves risk. Prospective should understand the characteristics of Securities and study information about VGI Global Media Public Company Limited (“VGI” or the “Company”) before making a decision to invest in Securities.
This Presentation is not intended to provide the basis for any investment decision, nor to substitute your own analysis and investigation, and should not be considered as a recommendation to any recipient of this Presentation. Some statements made in this presentation are forward-looking statements, which are subject to various risks and uncertainties. These include statements with respect to the Company’s corporate plans, strategies and beliefs and other statement that are not historical facts. These statement can be identified by the use of forward-looking terminology such as “may”, “will”, “expect” , “intend”, “estimate”, “continue”, “plan” or other similar words.
The statements are based on the assumptions and beliefs of the Company’s management in light of the information currently available to the Company. These assumptions involve risks and uncertainties which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Nothing in this Presentation is, or should be, relied on as promise or representation of the Company as to the future.
Disclaimer
Section 1 Media Industry Overview
Section 2 2015/16 Key Milestone & Financial Performance
Section 2.1 2015/16 Key Milestone
Section 2.2 2015/16 Financial Performance
Section 3 Business Update & 2016/17 Outlook
Agenda
TV, 46.4%
Digital TV, 17.1%
Newspapers, 10.0% Cable TV, 5.0%
Radio, 4.8%
Cinema, 4.4%
Transit, 3.9%
Internet, 1.0% In-Store, 0.4%
Outdoor, 3.7%
FY 14/15 FY 15/16 % YoY
TV 62.8 55.6 -11.4%
Digital TV 13.5 20.5 51.2%
Cable/Satellite TV 6.1 6.0 -0.9%
Traditional Media* 23.5 21.6 -8.2%
Cinema 4.5 5.3 19.3%
Outdoor 4.0 4.4 11.6%
Transit 3.9 4.7 18.5%
Internet 1.0 1.2 25.5%
In-Store 1.9 0.4 -77.8%
Total Industry 121.2 119.8 -1.2%
Media Industry Overview 2015/16 THAI ADSPEND VALUE (THB bn)
4
2014/15 2015/16
1 FMCG 40% 40%
2 MOTOR VEHICLES 8% 8%
3 COMMUNICATIONS 7% 6%
4 GOVERNMENT & COMMUNITY ANNOUNCEMENT
6% 6%
5 LEISURE 5% 5%
TOP 5 65% 65%
OTHERS 35% 35%
2014/15 2015/16
1 FMCG 39% 38%
2 COMUNICATIONS 8% 7%
3 REAL ESTATE 3% 6%
4 RETAIL SHOPS AND STORES
3% 6%
5 MEDIA & MARKETING
5% 5%
TOP 5 58% 61%
OTHERS 42% 39%
2015/16 MEDIA ADSPEND (THB bn)
Source: The Nielsen Company (Thailand) Limited.
THB 120bn
*Includes Newspaper, Magazines and Radio ** Excludes Modern Trade Media Revenue
OVERALL MEDIA INDUSTRY VGI MASS TRANSIT
Section 1: Media Industry Overview
Magazines, 3.3%
TOP 5 ADSPEND BY BUSINESS SEGMENT THAI ADSPEND VS VGI REVENUE (THB mn)
(THB mn) 2014/15 2015/16 % YoY
Total Industry 121,213 119,810 -1.2%
VGI 1,994 2,056 +3.1%
28,755 29,264 28,951 26,407
28,894 30,869
32,200 29,250
31,521 30,782 30,774
26,733
460 486 486 422 476 490 542 486 499 537 520 500
Q113/14
Q213/14
Q313/14
Q413/14
Q114/15
Q214/15
Q314/15
Q414/15
Q115/16
Q215/16
Q315/16
Q415/16
Total Industry AdSpend (THB mn) VGI Revenue* (THB mn)*
Section 1 Media Industry Overview
Section 2 2015/16 Key Milestone & Financial Performance
Section 2.1 2015/16 Key Milestone
Section 2.2 2015/16 Financial Performance
Section 3 Business Update & 2016/17 Outlook
Agenda
6
STRATEGIC DEVELOPMENTS
2015/16 Key Milestone
Section 2.1: 2015/16 Key Milestone
1Q 15/16: ● Secured advertising contract on 7 green line extension stations
● Expanded our footprint into aviation media by investing 20% of AERO MEDIA 3Q 15/16: ● Expanded our network into residential buildings by becoming an exclusive sale agent for ARTISTA 4Q 15/16: ● Announced our intention to evolve into “Nationwide Integrated Media Platform”
● Announced an agreement to acquire additional 12.46% in which will trigger tender offer for all the remaining of MACO shares.
OUR NETWORK
RAIL MASS TRANSIT: 52 BTS trains 30 BTS stations > 4,000 static displays 2,029 digital screens
OFFICE BUILDINGS: 135 grade A&B office buildings 1,091 digital screens
CONDOMINIUMS: 219 residential buildings 549 digital screens
AVIATION: 13 airports 342 LCD screens 4,500 trolleys 57 aerobridges
OUTDOOR: 658 billboard & networking billboard 678 street furniture
7
CONSOLIDATED P&L SNAPSHOT (FINANCIAL STATEMENT)
2015/16 Overview
Section 2.2: Financial Performance
(THB mn) 2015/16 2014/15 % YoY
Operating revenue 2,106 2,963 -28.9%
Cost of sales 769 1,325 -41.9%
Gross profit 1,337 1,638 -18.4%
EBITDA 1,336 1,225 9.0%
NPAT from operation 838 1,010 -17.0%
NPAT (inc. extra items) 941 838 12.3%
Margin (%)
Gross profit margin 63.5% 55.3%
EBITDA margin 63.5% 41.4%
NPAT margin (from operation)
39.8% 34.1%
NPAT margin (inc. extra items)
44.7% 28.3%
(THB mn) 2015/16 2014/15 % YoY
Operating revenue 2,056 1,994 3.1%
Cost of sales 710 532 33.7%
Gross profit 1,346 1,462 -8.0%
EBITDA* 1,245 1,356 -8.2%
NPAT from operation 851 972 -12.4%
NPAT (inc. extra items) 954 799 19.4%
Margin (%)
Gross profit margin 65.4% 73.3%
EBITDA margin* 60.6% 68.0%
NPAT margin (from operation)
41.4% 48.8%
NPAT margin (inc. extra items)
46.4% 40.1%
CONSOLIDATED P&L SNAPSHOT (W/O MODERN TRADE MEDIA)
86.1%
13.9%
2015/16 REVENUE CONTRIBUTION
88.2%
11.8%
2015/16 REVENUE CONTRIBUTION
BTS-related media BTS-related media
Office building & other media
Office building & other media
THB 2,106mn THB 2,056mn
*excludes extra items
8
BTS-RELATED REVENUE (THB mn) BTS-RELATED REVENUE BREAKDOWN (THB mn)
OFFICE BUILDING & OTHER REVENUE (THB mn)
Financial Performance by Sector
OFFICE BUILDING & OTHER REVENUE BREAKDOWN (THB mn)
1,805 1,813
2014/15 2015/16
+0.4% YoY 825
580
401
757
597
459
Train Station Merchandising andOthers
2014/15
2015/16
45.7% 41.7%
32.1% 33.0%
22.2% 25.3%
163
26
201
42
Office Building Other Media
2014/15
2015/16
86.2% 32.8% 82.7%
25.3%
189
243
2014/15 2015/16
+28.6% YoY
13.8% 17.3%
Section 2.2: Financial Performance
+23.6% YoY
+61.4% YoY
2,244 2,262
1,042 837
31-Mar-15 31-Mar-16
1,829 2,242
24
35 1,433 822
31-Mar-15 31-Mar-16
9
ASSETS BREAKDOWN (THB mn)
32%
68%
LIABILITY & EQUITY BREAKDOWN (THB mn)
CASH FLOW (THB mn)
Balance Sheet & Cash Flow
Non-current assets
Current assets 27%
73%
3,286 3,099
Equity
Non-current liabilities
Current liabilities
55%
1%
44%
72%
1%
27%
3,286 3,099
2015/16
BTS-related Media 93
Office building & Others 65
Total 158
529 355
785
65
158 69
515
290
Beginningcash
(31/03/15)
CFO Asso.comand JV
(Invt.&Loanto &Sales)
CapEx Int. Income& oth.
DividendPayment
CFF (S/T repay)
Ending Cash(31/03/16)
CAPEX (THB mn)
Section 2.2: Financial Performance
CFI of THB 154mn
CFF of THB 805mn
Section 1 Media Industry Overview
Section 2 2015/16 Key Milestone & Financial Performance
Section 2.1 2015/16 Key Milestone
Section 2.2 2015/16 Financial Performance
Section 3 Business Update & 2016/17 Outlook
Agenda
11
>37.42% in
MACO
178 mega
billboards
480 networking
billboards
678 street
furniture
56% GP margin
63% market share (Grade A&B buildings)
>650,000 viewers reached daily
135 office buildings
219 condominiums
60% GP margin
55% market share
>700,000 viewers reached daily
Long term contracts end 2029 & 2042
4X expected
capacity
70% GP margin
Online & Offline
5mn card holders
90 offline
merchants
>30mn potential
e-wallet members
33mn potential
online impressions
Targeted
2mn registered
loyalty members
16mn monthly
emails targeted for FY16
2.6mn monthly
deliveries (Kerry)
1st strategic step proven winner growth prospects
20% in Aero Media
>115mn viewers
reached annually
342 LCD screens
4,500 trolleys
57 aerobridges
transit office outdoor aviation digital activation
Nationwide Integrated Media Platform “within 2 years”
Business Update
Section 3: Business Update & 2016/17 Outlook
founder group, 13.79%
Acquire additional 12.46% from
founder group
12
MACO Transaction VGI’s BODs held on March 16, 2016 approved the acquisition of ordinary shares and making of tender offer for the total securities of MACO. Expected transaction cost of THB 2,044.5mn.
*SPA: Sell and Purchase Agreement
acquire 375mn shares from major shareholders
number of shares 375mn shares (or 12.46% of total shares)
price THB 1.10 per share
total investment THB 412.5mn
founder group DCORP group (150mn shares, or 4.99%)
Maneerattanporn family (125mn shares, or
4.15%)
Tansalarak family (100mn shares, or 3.32%)
BOD approval
16 MAR
17 MAR
Execute SPA*
30 MAY
3 JUN 8 JUL
Tender offer period
31 MAY
EGM
12.46% Acquisition
done
tender offer
number of shares up to 1,484mn shares (or 0 to 48.79%* of total shares)
price THB 1.10 per share
total investment up to THB 1,632mn
source of funds Cash flows from operation and/or credit
facilities support from financial institutions
founder group, 26.26%
pre acquisition & tender offer
post acquisition & tender offer
public, 48.79%
VGI, 24.96%
VGI, 37.42%
public, 48.79% (tender offer)
After having 37.42% shareholding in MACO which triggers 25% threshold, VGI is required to do a tender offer for the rest of MACO’s shares
*Excluded the rest 13.79% of founder group.
TRANSACTION SUMMARY TIMELINE OF ACQUISITION & TENDER OFFER
PRE VS POST STRUCTURE
12.46% of founder group are:- 4.99% DCROP Group 4.15% maneerattanporn 3.32% Tansalarak
Section 3: Business Update & 2016/17 Outlook
THB 3,100mn
Other 5%
BTS – Related 61% Outdoor 26%
Office Building 8%
13
VGI TARGET REVENUE (THB mn) & GROWTH (%) REVENUE BREAKDOWN (THB mn)
2016/17 VGI Targets and CapEx
3,100
1,900
800
250 150
Total Revenue BTS-RelatedMedia
Outdoor Media Office BuildingMedia
Other Media
*after elimination
*
GROWTH DRIVERS (%)
• Increase occupancy in all existing media • 7 new extension stations
BTS
• Increase package price by 20% • Increase number of buildings from 130 to
160 buildings Office Building
• Media capacity is expected to increase from THB 900mn in 2015 to THB 1,300mn in 2016.
Outdoor
• Additional revenue from Chamchuri Square, Wifi project, Empire tower, UPC Co mass and Clock Tower
Other
500
100
200
100 100
Total CAPEX BTS-RelatedMedia
Outdoor Media Office BuildingMedia
Other Media
Total CAPEX of THB 500mn, comprising VGI CAPEX of THB 300mn and MACO CAPEX of THB 200mn
+50% +5% +25% +240%
REVENUE BREAKDOWN (THB mn)
Section 3: Business Update & 2016/17 Outlook
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