NZME releases new three-year strategy
NZME Limited. 2-4 Graham Street, Private Bag 92198, Victoria Street West, Auckland.
MARKET ANNOUNCEMENT
NZME continues digital-led focus: releases new three-year strategy
AUCKLAND, 15 November 2023: NZME Limited (NZX: NZM, ASX: NZM) (“NZME”) has today
released its revised three-year strategy, with digital transformation at its core across its three
divisions: Audio, Publishing and OneRoof. The strategy has been released ahead of NZME’s
annual Investor Day virtual event at 10am today.
Michael Boggs, NZME CEO, says NZME’s central objective is to relentlessly pursue a digital
led strategy across its three key platforms. This work is being delivered by NZME’s dedicated
team of more than 1200 people.
“Digital revenues have shown strong growth over recent years, reflecting the strength of
NZME’s strategy and platforms. We remain committed to growing digital revenues - it is core
to the future improved profitability and sustainability of our business, and to delivering value
for our shareholders,” he says.
Boggs says across NZME, digital revenue is forecast to be 29 percent of NZME’s total revenue
in 2023, more than doubling as a percentage of total revenue since 2019.
“We are pleased that across the business we are growing the digital mix of revenue. In digital
audio we have more than 70 percent market share
1
versus our key audio competitor, and we
believe there is potential for rapid growth.
“Digital revenues within publishing advertising and reader revenue have now significantly
changed the mix of print versus digital revenues. NZME’s publishing division is now organised
into separate digital and print units – a true digital first model. Given this, a profitable digital
publishing business is now visible from an operational and profitability perspective and it is
now funding the leading journalism produced by NZME.
“Finally, a transformational change is happening at OneRoof due to the growth in our digital
property platform, which is setting that division up for future success,” says Boggs.
NZME also released its revised three-year strategic priorities across its Audio, Publishing and
OneRoof divisions.
• To be Number One in Audio
• To be New Zealand’s leading news destination
• To be Your essential property platform
Number One in Audio
NZME’s Audio business includes its many radio brands, digital audio platform iHeartRadio,
and its high-performing podcast network.
The newly released strategic priority to be ‘Number One in Audio’ includes a strong focus on
three key pillars:
• Create the most listened to and loved content
• Deliver customer solutions to grow revenue share
• Grow podcast engagement and monetisation
15 November 2023
NZME Limited. 2-4 Graham Street, Private Bag 92198, Victoria Street West, Auckland.
2
MARKET ANNOUNCEMENT
New Zealand’s leading news destination
NZME’s Publishing business covers its digital platforms including NZ Herald Premium,
BusinessDesk and VIVA Premium, as well as its national, regional and community print
products.
The newly released strategic priority to be ‘New Zealand’s leading news destination’
includes a strong focus on three key pillars:
• Scalable digital audience and advertising news platform
• Expert journalism that grows subscriber lifetime value
• High quality and efficient print business
Your essential property platform
NZME’s OneRoof business covers its online platform OneRoof.co.nz which houses property
listings, valuations, as well as property and real estate industry news.
Its newly released strategic priority is to be ‘Your essential property platform’, and includes
a strong focus on three key pillars:
• Superior listings experience and performance
• Grow listings revenue
• Accelerate non-listings portfolio
Boggs says he is proud to reveal a digital-led strategy that is focused on delivering superior
returns.
“We believe this strategy sets us apart from our competitors and we expect it to deliver returns
for shareholders. Our Audio business has significant opportunities that are already improving
our profitability, in Publishing we are currently investing heavily in our digital publishing platform
and a new business of journalism operating model, and OneRoof is at a tipping point and we
are confident that significant shareholder value can be created from the very large profit pool
that it operates in,” he says.
The full NZME Investor Day 2023 presentation is attached to this announcement.
ENDS
Source:
1
Radio Broadcasters Association Monthly Radio Market Report, 6-month average to 30 June 2023 (H1 2023). Note:
report excludes independent broadcasters and contra revenue.
Authorised by Michael Boggs, Chief Executive Officer.
For further information:
Media Investors
Kelly Gunn
GM Communications
+64 27 213 5625
kelly.gunn@nzme.co.nz
David Mackrell
Chief Financial Officer
+64 21 311 911
Email: david.mackrell@nzme.co.nz
---
1
2023
INVESTOR DAY
2
1.CEO Overview
Michael Boggs
CHIEF EXECUTIVE OFFICER
3
Executive team
1.CEO Overview
Michael Boggs
Chief Executive
Officer
David Mackrell
Chief Financial
Officer
Jason Winstanley
Chief Audio Officer
Carolyn Luey
Chief Digital and
Publishing Officer
Greg Hornblow
Chief of OneRoof
Katie Mills
Chief Marketing
Officer
Tracey Taylor
Chief People
Officer
4
2025
91%
of the people
living in
Auckland
1
72%
of the people
living in South
Island
1
89%
ofthe people
living in the
North Island
1
Audio Audience
Digital audience
1,308,300
2
Terrestrial audience
1,925,400
3
Publishing Audience
Digital audience
1,949,000
4
Print audience
1,087,000
1
OneRoofAudience
Digital audience
518,000
4
Print audience
293,000
1
SOURCE:
1
Nielsen CMI Fused Q3 22 –Q2 23 August 2023 AP15+ (Total NZME = monthly NZME print, weekly NIMS, Weekly Radio GfK Fused S2 2023 and monthly online fused. Publishing Print = weekly print exclReal Estate. OneRoofPrint = Real Estate sections.)
2
Adswizz AudiometrixSept 2023
3
GfK RAM Comm, Total NZ, M-S 12mn –12mn, Cume, AP10+
4
Nielsen Online Ratings Sept 2023 (desktop and domestic traffic only, does not include exclusive mobile app audience)
NZME’s brands reach more than 3.5 million people across
NZ each month
1
1.CEO Overview
5
Board Members
Barbara Chapman
Chairman
Carol Campbell
Independent
Director
David Gibson
Independent
Director
Sussan Turner
Independent
Director
Guy Horrocks
Independent
Director
We are governed and supported by an engaged and independent Board with
diverse experience and backgrounds
1.CEO Overview
6
We have a team of more than 1200 people and we are
proud of our employer promise –This Could Lead Anywhere
At NZME we are committed to
fostering an innovative, engaged,
inclusive workplace.
We have three distinct pillars to
support engagement and the
development of our people:
Inspire Me, Coach Me, Develop Me
Within each pillar we have initiatives
to support a great workplace culture,
provide learning and development
for everyone, and create exceptional
leaders.
1.CEO Overview
7
We have a strong commitment to sustainability
1.CEO Overview
8
Three strategic priorities were set in 2020, with targets for
2023, with digital transformation at the core of the
strategy
NEW ZEALAND’S
LEADING AUDIO
COMPANY
Create New Zealand’s best
local audio content
Grow broadcast and
digital reach
Grow market revenue
share and digital revenue
The #1 News brand for
all New Zealanders
Subscriber
first
Be a safe, scalable
destination for
advertisers
Strengthen core residential
listings business
Be indispensable
to agents
Expand the
portfolio
NEW ZEALAND’S
HERALD
YOUR COMPLETE
PROPERTY
DESTINATION
1.CEO Overview
9
Digital revenues have shown strong growth
-
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
20192020202120222023F
Digital audio revenue $m
~50% CAGR
-
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
20192020202120222023F
Digital Publishing revenue $m
Advertising revenueReader revenue
~6% CAGR
~80% CAGR
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
20192020202120222023F
Digital OneRoof revenue $m
~45% CAGR
1.CEO Overview
Source: NZME Analysis.
10
Every business is showing digital mix changes
Total digital revenues now represent 29% of total revenue compared to 13% in 2019
-
20%
40%
60%
80%
100%
20192020202120222023F
Audio
DigitalBroadcast
-
20%
40%
60%
80%
100%
20192020202120222023F
Publishing advertising revenue
DigitalPrint
-
20%
40%
60%
80%
100%
20192020202120222023F
Publishing reader revenue
DigitalPrint
-
20%
40%
60%
80%
100%
20192020202120222023F
OneRoof
DigitalPrint
1.CEO Overview
Source: NZME Analysis.
11
Audio Scorecard–2020 to 2023
Metric
2023 Target set
in 2020
2020
Achievement
2021
Achievement
2022
Achievement
H1 2023
Achievement
Tracking
NZME share of total
audience
> 1% share point
growth per
annum
35.6%
1
37.4%
1
37.7%
1
38.1%
1
Radio Revenue Share
> 1% share point
growth per
annum
40.4%
2
40.9%
2
41.4%
2
42.4%
2
Digital audio revenue
as a % of total audio
revenue
5%2.4%3.4%5.1%7.0%
EBITDA
3
Margin
Target
(pre NZIFRS16)
15 –17%14%
4
12%13%12%
NEW ZEALAND’S
LEADING AUDIO
COMPANY
1.CEO Overview
1.GfK Commercial RAM, NZME excl. Partners, Total NZ, M-S 12mn-12mn, Market Share %, S4 2020 –S1 2023, AP10+
2.Radio Broadcasters Association Monthly Radio Market Report, rolling 12-month average to 31 December (2020 –2022) and 12-month average to 30 June 2023 (H1 2023). Note: report excludes independent broadcasters, contra revenue, and digital audio.
3.EBITDA is a non-GAAP measure and excludes exceptional items.
4.Includes Covid-19 government wage subsidy received in 2020. Excluding the impact of the government wage subsidy received in 2020, the EBITDA margin was 10.5%.
12
NEW ZEALAND’S
HERALD
Publishing Scorecard –2020 to 2023
Metric
2023 Target set
in 2020
2020
Achievement
2021
Achievement
2022
Achievement
H1 2023
Achievement
Tracking
Subscription Volume
Target
More than
210,000 by
2023year-end
169,000191,000209,000
1
218,000
1
Subscription Volume
Mix
Digital Only >
Print
32% / 68%43% / 57%54% / 46%56% / 44%
% Households
Subscribing
> 12% by year-
end
9%
2
10%
2
11%
2
11%
2
Advertising Revenue
Mix
> 45% Digital42% Digital46% Digital48% Digital48% Digital
EBITDA
3
Margin Target
(pre NZIFRS16)
18-19%
5
19%
4
18%18%11%
1.CEO Overview
1.Includes the impact of the BusinessDeskacquisition.
2.Stats.govt.nz Dwelling and household estimates: June 2023 quarter.
3.EBITDA is a non-GAAP measure and excludes exceptional items.
4.Includes Covid-19 government wage subsidy received in 2020. Excluding the impact of the government wage subsidy received in 2020, the EBITDA margin was 17.0%.
5.Adjusted from 19-20% to reflect the change in accounting policy on SaaS arrangements. Capital expenditure is expected to reduce by a similar amount.
13
YOUR COMPLETE
PROPERTY
DESTINATION
OneRoofScorecard –2020 to 2023
Metric
2023 Target set
in 2020
2020
Achievement
2021
Achievement
2022
Achievement
H1 2023
Achievement
Tracking
Residential Listings
96% of listings
(100% of non-
private)
89%
1
91%
1
89%
1
90%
1
AudienceReduce gap to #1
459k,
gap to #1 of
250k
2
497k,
gap to #1 of 396k
2
564k,
gap to #1 of
152k
2
518k,
gap to #1 of
139k
2
Listings Upgrade %
5
50% of Auckland
residentiallisting
22% of regional
residentiallistings
17.6%
Auckland
3.9%
Regional
23.5%
Auckland
5.4%
Regional
38.4%
Auckland
14.8%
Regional
42.6%
Auckland
16.8% Regional
RevenueDigital > Print24% / 76%38% / 62%46% / 54%53% / 47%
EBITDA
3
Margin Target
(pre NZIFRS16)
15 -25%8%
4
7%(9%)(17%)
1.CEO Overview
1.OneRoof’s listings as a percentage of residential for-sale real estate listings on trademe.co.nz. June 2023 average. 2020 -2022 figures as previously stated in 2022 Full Year results presentation.
2.Nielsen Online Ratings -Domestic Unique Audience(does not include exclusive mobile app audience), monthly average for Q2 2023.2020 -2022 figures as previously stated in 2022 Full Year results presentation.
3.EBITDA is a non-GAAP measure and excludes exceptional items.
4.Includes Covid-19 government wage subsidy received in 2020. Excluding the impact of the government wage subsidy received in 2020, the EBITDA margin was 4.7%.
5.As at Q4 for 2020 –2022 and as atJune for H1 2023. Updated methodology used from 2022 (multiple upgrade packages for single listings now counted as single upgrade and other categories are more clearly defined).
14
FY23 and Beyond
1.CEO Overview
15
Operating Environment
NZME has operated amidst a backdrop of difficult trading conditions over the last year
-
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
Mar-17
Jun-17
Sep-17
Dec-17
Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
Sep-19
Dec-19
Mar-20
Jun-20
Sep-20
Dec-20
Mar-21
Jun-21
Sep-21
Dec-21
Mar-22
Jun-22
Sep-22
Dec-22
Mar-23
Jun-23
Sep-23
Dec-23
Quarterly interest rates (OCR)
1
ActualForecast
-
2.00%
4.00%
6.00%
8.00%
Mar-17
Jun-17
Sep-17
Dec-17
Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
Sep-19
Dec-19
Mar-20
Jun-20
Sep-20
Dec-20
Mar-21
Jun-21
Sep-21
Dec-21
Mar-22
Jun-22
Sep-22
Dec-22
Mar-23
Jun-23
Sep-23
Dec-23
Quarterly inflation (CPI)
2
ActualForecast
-
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
Mar-17
Jun-17
Sep-17
Dec-17
Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
Sep-19
Dec-19
Mar-20
Jun-20
Sep-20
Dec-20
Mar-21
Jun-21
Sep-21
Dec-21
Mar-22
Jun-22
Sep-22
Dec-22
Mar-23
Jun-23
Sep-23
Dec-23
Quarterly unemployment rate
2
ActualForecast
10,000
15,000
20,000
25,000
30,000
35,000
Mar-17
Jun-17
Sep-17
Dec-17
Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
Sep-19
Dec-19
Mar-20
Jun-20
Sep-20
Dec-20
Mar-21
Jun-21
Sep-21
Dec-21
Mar-22
Jun-22
Sep-22
Dec-22
Mar-23
Jun-23
Sep-23
Dec-23
Quarterly new residential listings
3
ActualForecast
1.ANZ Interest rate forecasts as of 19 October 2023
2.ANZ Economic forecasts as of 03 November 2023
3.REINZ data to September 2023 quarter, NZME estimate for December 2023 quarter
1.CEO Overview
16
Business confidence has improved significantly, but
consumers are still hurting and wary
(80.0)
(60.0)
(40.0)
(20.0)
-
20.0
40.0
Dec-16
Mar-17
Jun-17
Sep-17
Dec-17
Mar-18
Jun-18
Sep-18
Dec-18
Mar-19
Jun-19
Sep-19
Dec-19
Mar-20
Jun-20
Sep-20
Dec-20
Mar-21
Jun-21
Sep-21
Dec-21
Mar-22
Jun-22
Sep-22
Dec-22
Mar-23
Jun-23
Sep-23
Quarterly survey responses -2017 to 2023
Business confidence
Consumer confidence
(80.0)
(60.0)
(40.0)
(20.0)
-
20.0
40.0
Dec-20
Jan-21
Feb-21
Mar-21
Apr-21
May-21
Jun-21
Jul-21
Aug-21
Sep-21
Oct-21
Nov-21
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
Jul-22
Aug-22
Sep-22
Oct-22
Nov-22
Dec-22
Jan-23
Feb-23
Mar-23
Apr-23
May-23
Jun-23
Jul-23
Aug-23
Sep-23
Oct-23
Monthly survey responses -2021 to 2023
Business confidence
Consumer confidence
“NZ remains on course for a period of subdued economic
growth as the impact of high interest rates continues,
although increasing migration and a strengthened
housing market will provide some offset”
Westpac Economic Overview, October 2023
1.CEO Overview
Source: ANZ Business Confidence and ANZ –Roy Morgan Consumer Confidence surveys
17
(15.0%)
(10.0%)
(5.0%)
-
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
NZME Advertising Revenue Variance
1
YoY actualv 2019
Business confidence improvement is being reflected in
advertising revenue returning to growth, but not
consistently
A trend of improvement is evident in H2 2023
1.NZME analysis
Growth on prior year
given lockdown
1.CEO Overview
18
2023 Update
1.CEO Overview
FINANCIAL PERFORMANCE
The economic environment over the past year has been difficult.
For the first half advertising revenue was down 7% year on year.
The second half has seen improvement in business confidence, but this is not yet consistently reflected in advertising
revenue results:
•Quarter 3 advertising revenue was down 2% year on year.
•Quarter 4 started with October advertising revenue growth of 1% year on year.
•November (the largest revenue month of the year) and December are currently pacing slower, with customer
campaigns being cancelled or deferred until 2024.
Given the current advertising revenue volatility in the market, NZME amends its guidance for EBITDA to be between
$57 million and $59 million for 2023.
OneRoofUPDATE
OneRoofis delivering strong results:
•The real estate market is improving.
•Quarter 3 saw OneRoofdigital revenues increase by 16% year on year despite listings being subdued.
•Quarter 4 has started well with October delivering year on year growth of 23%.
CAPITAL MANAGEMENT
The Board wishes to reiterate it remains open to returning any excess capital to shareholders when the right business
and market conditions exist, and it continues to be their intention to review the company’s capital management
options together with the full year 2023 results in February 2024.
19
The next three years
1.CEO Overview
20
Global platforms continue to demonstrate the value of
digital growth models for NZME
$miHeart
3
NZME
Audio
3
NY Times
3
NZME
Publishing
3
Domain
4
OneRoof
3
NZME
Group
3
Revenue
1
6,699 114 3,953 225 377 23 365
EBITDA
1
1,627 23 596 47 119 (1)65
EBITDA margin24.3% 13.2% 15.1% 17.7% 31.4% (9.3%)13.4%
Enterprise value (EV)
2
10,259 9,0092,815229
EV / Revenue1.5 2.3 7.5 0.6
EV / EBITDA6.3 15.1 23.7 3.5
Digital % of revenue26% 5% 56% 41% 95% 46% 27%
1.NZD equivalent
2.Derived from Market Capitalisation plus reported Net Debt as at reported year end
3.Based on FY22 reported results for year ended 31 December 2022
4.Based on FY23 reported results for year ended 30 June 2023
1.CEO Overview
21
Publishing
Division
Digital Publishing
•Content produced for
digital publishing
•Revenue from
subscribers and
advertisers
•Costs include all content
costs excluding specific
print related curation and
production
Print Hub
•Content from Digital
journalism curated into
print publications
•Revenue from print
subscribers and
advertisers
•Costs include only those
required to curate digital
content into print
products and print and
distribution costs
1.CEO Overview
NZME’s Publishing division organised into separate digital
and print units –a true digital first model
22
A profitable digital business that is now funding journalism
$ million
2022
Print
2022
Digital
2022 Total
Publishing
Subscription revenue
63.919.883.7
Advertising revenue
63.859.5123.3
Other
5.513.018.5
Total revenue133.292.2225.4
People(36.7)(46.1)(82.8)
Print & Distribution(45.4)-(45.4)
Agency Commission & Marketing(7.7)(10.2)(17.8)
Content
(1.4)(8.5)(9.8)
Other
(8.5)(13.6)(22.1)
Publishing expenses
(99.6)(78.3)(178.0)
Publishing EBITDA
1
(incl. NZ IFRS 16)
33.613.947.4
NZ IFRS 16 Adjustment
(5.3)(2.3)(7.7)
Publishing EBITDA
1
(pre NZ IFRS16)
28.211.539.8
EBITDA
1
Margin (pre NZ IFRS 16)
21%13%18%
1.EBITDA is a non-GAAP measure and excludes exceptional items.
Digital will outperform Print
in the future (conceptual)
1.CEO Overview
Future Publishing profitability
DigitalPrint
Source: NZME Analysis.
23
Separating digital from print provides clear line of sight
to profit pools
•A profitable digital business is now visible
from an operational and profitability
perspective. It provides the ability to fund
New Zealand’s leading journalism.
•Digital business can now make decisions on
content and audience growth specifically for
the digital product
•Recognisesvalue of digital subscriptions
within print bundles
•Transparency enables us to clearly consider
the opportunities and future investments in
digital products
1.CEO Overview
•Improves focus on operating to maximise
cashflow, returns and investment trade-offs
•Extends the runway of the business with
specific business focus
•Clearly enables consideration of inflection
point and the potential future transfer of
revenue to digital
•Provides clarity when considering optionality
for the business
Digital Publishing BusinessPrint Publishing Business
24
Create the most listened to
and loved content
Deliver customer solutions
to grow revenue share
Grow podcast engagement
and monetisation
NUMBER ONE IN
AUDIO
Evolved our three strategic priorities for next three years
NEW ZEALAND’S LEADING
NEWS DESTINATION
Scalable digital audience
and advertising News
platform
Expert journalism that
grows subscriber lifetime
value
High quality and efficient
print business
YOUR ESSENTIAL
PROPERTY PLATFORM
Superior listings
experience and performance
Grow listingsrevenue
Accelerate non-listings
portfolio
1.CEO Overview
25
1.CEO Overview
Digital led strategy focused on delivering superior returns
Our central objective is to relentlessly pursue a digital led strategy across our three key platforms. This will set us
apart from our competitors and drive returns for shareholders. Globally these digital centric businesses are valued at
much higher multiples than print peers.
We are getting real traction on our leading podcast position in NZand this will drive future digital revenue growth.
Our strong position in news, politics and business continues to grow strongly and is improving our audio profitability.
We have entertainment brands that can grow share.
We are currently investing heavily in our digital publishing platform and a new ‘business of journalism’ operating
model. We believe this will provide us with a very different and superior capability relative to our competitors. We
have a profitable digital news business that supports journalism for the future generations.
The business is at a tipping point. It is now profitable. With continued focus, we remain confident that it will scale to
be in a strong number two position within a sector that has a very large profit pool.
Competitive Environment:
We are fortunate, relative to our competitors, that
our strong performance, profitability and balance
sheet allows us to invest in business. This is
delivering gains in our key metrics.
Economic Environment:
It’s hard to predict; however, there are encouraging
signs that we are at or just past the bottom of the
cycle.
26
2.Performance Update
David Mackrell
CHIEF FINANCIAL OFFICER
27
Revenue and earnings substantially stable during difficult
period
1.EBITDA is a non-GAAP measure and excludes the impacts of exceptional items (redundancy costs, one-off projects and other exceptional items) and has been adjusted to remove GrabOnefrom comparative years. Please
refer to the NZME Results Presentation on NZX and ASX for a full explanation. FY19 NPAT excludes goodwill impairment of $175m, and FY21 NPAT excludes impact of GrabOnegain on sale.
-
50
100
150
200
250
300
350
400
20192020202120222023F
Revenue $m
Publishing DigitalPublishing PrintAudioOneRoofOther
2.Performance Update
-
10
20
30
40
50
60
70
20192020202120222023F
Profitability $m
1
EBITDA (NZ IFRS 16)NPAT
28
•Focus on the cost base has continued and remains
below the 2019 level
•Investment in OneRoofgrowth and BusinessDesk
addition is partly offset by sale of GrabOne
•Wage and salary inflation has continued to have a
significant impact on the cost base
•Print volumes have reduced significantly resulting in
lower print and distribution costs, albeit higher paper
prices and distribution cost increases have partially
offset the volume related reduction
There has been a continued focus on containing cost base
2.Performance Update
Source: NZME Analysis.
29
Capital expenditure has stabilisedat ~$10m
2.Performance Update
Source: NZME Analysis.
-
2.0
4.0
6.0
8.0
10.0
12.0
20192020202120222023F
Capital expenditure $m
Product developmentTechnology & Broadcast InfrastructurePropertyOther
•Majority of annual capital spend is on product
development relating to digital platforms
•Core technology and broadcast infrastructure
spend is reasonably consistent year to year
•In addition to the capital expenditure amount
there is typically $1-3 million of software as a
service development costs which is treated as
an operating expense
30
Strong free cashflow and net debt substantially reduced
–expected to be bottom of target range
Notes:
1.Leverage Ratio is net debt / 12-month Operating EBITDA (pre IFRS 16).
7.7
23.8
41.1
34.5
14.8
201820192020202120222023F
Operating free cash flow $m
98.3 74.7 33.8
(13.5)
17.5 30.7 31.6
1.8
1.5
0.6
0.4
0.7
0.8
0.3
20182019202020212022Apr '23Jun '23Dec '23
Net debt and Leverage
1
Net Debt / (Cash) $mLeverage Ratio
2.Performance Update
Target Leverage Ratio
•In the current uncertain economic environmentthe company intends to operate at the lower end of its target leverage ratio of
0.5 to 1.0 times EBITDA
1
(pre IFRS 16).
31
Shareholder returns
3.5 3.5
2.0
3.0 3.0 3.0
6.0 6.0
5.0
6.0
-
5.0
9.5 9.5
2.0
--
8.0
14.0
3.0
20162017201820192020202120222023
Dividends Declared (cents per share)
InterimFinalSpecial
2.Performance Update
Dividend Policy
"NZME intends to pay dividends of 50-80% of Free Cash Flow subject to being within its target leverage ratio and having regard
to NZME's capital requirements, operating performance and financial position“.
6.9
18.6
15.7
--
5.9
25.4
16.5
17.6
20162017201820192020202120222023
Dividend payments and Share buyback ($m)
Dividends paidShare buyback
32
Earnings mix transitions over the coming years with strong
OneRoofcontribution
2019
Audio
Publishing
OneRoof
2.Performance Update
2026F
Audio
Publishing Digital
Publishing Print
OneRoof
2023F
Audio
Publishing Digital
Publishing Print
OneRoof
The digital publishing business profitability is expected to overtake the print business
during 2026
Source: NZME Analysis. Note Publishing Digital and Publishing Print shown as combined Publishing value for 2019.
33
AUDIO
34
3.Audio Number One in Audio
Jason Winstanley
CHIEF AUDIO OFFICER
35
Number One In Audio
3.Audio Number One in AudioStrategy
Create the most listened
to and loved content
Deliver customer
solutions to grow
revenue share
Grow podcast
engagement and
monetisation
There are three pillars to the Audio strategy
36
Create the most listened
to and loved content
Deliver customer
solutions to grow
revenue share
Grow podcast
engagement and
monetisation
There are three pillars to the Audio strategy
Number One in Audio
3.Audio Number One in AudioStrategy
37
3.Audio Number One in AudioMost listened to and loved content
Terrestrial radio’s audience is now larger than television
in some overseas markets
63%
69%
67%
83%
103%
105%
201820192020202120222023
Nielsen Total Audience Report: Persons 18-49 average audience
of AM/FM radio as a % of live + time-shifted TV (USA)
In 2018, AM/FM radio’s 18-49 average audience was 63% of TV’s. In Q2 2023, AM/FM radio’s audience was 5% larger than TV’s.
Source: Nielsen Total Audience Report, Q2 2018, Q2 2019, Q2 2020, Q3 2021, Q3 2022, Q2 2023. Persons 18-49. Average audience determined by multiplying weekly reach of users by weekly time spent among users of each medium.
38
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
200920102011201220132014201520162017201820192020202120222023
Audio Consumption USA
Listened to a Podcast in the last monthListened to online Audio in last weekWeekly terrestrial radio listenership
Terrestrial remains the biggest channel for consumption
anddigital continuesits growth in USA
Source:
1.
TheInfinite Dial 2023, Edison Research,.
2
Nielsen Audio RADAR
•82% of Americans listen to
terrestrial radio each week
•Strong growth in digital
listening across both
podcasting and streaming
Note : Online Audio = listening to AM/FM radio stations online or listening to streamed audio
content available only on the internet
1
1
3.Audio Number One in AudioMost listened to and loved content
2
39
Podcast consumption in the USA continues to grow,
now reflecting 19% of all ad-supported consumption
37%
14%
10%
7%
6%
5%
3.4%
3%
3%
2%
2%
2%
2%
2%
1%
0.4%
AM/FM radio (terrestrial & streaming)
Music videos on YouTube
Podcasts
Owned music
Ad-free SiriusXM
Ad-free Spotify
Other streaming audio
TV music channels
Audiobooks
Ad-supported Pandora
Ad-supported Spotify
Apple Music
Ad-supported SiriusXM
Amazon Music
Ad-free Pandora
Other
Total Audio Consumption (Share)
1
69%
19%
4%
4%
4%
AM/FM radio (terrestrial & streaming)
Podcasts
Ad-supported Pandora
Ad-supported SiriusXM
Ad-supported Spotify
Ad-supported Audio Consumption (Share)
2
Source:
1
Edison Research, "Share of Ear,” Q3 2022-Q2 2023. Persons 18+; SiriusXM: Ad-Supported: Spoken Word. Ad-Free: Music; Podcasts listened to on streaming platforms are included in 'podcasts;' Percentages may
not add up to 100 due to rounding.
2
Edison Research, "Share of Ear,” Q3 2022-Q2 2023. Persons 18+; SiriusXM: Ad-Supported: Spoken Word. Ad-Free: Music; Podcasts listened to on streaming platforms are included in
'podcasts.'
3.Audio Number One in AudioMost listened to and loved content
40
Streaming radio has grown to account for 20% of time
spent listening in the USA
Source: Left: Nielsen RADAR Q4 2022, Nielsen Scarborough USA+ Rel2 2022, current 6 months; Right: Edison Research, ‘Share of Ear’, Q1 2021-Q1 2023; Persons 25-54
0%
5%
10%
15%
20%
25%
2021 Q12021 Q22021 Q32021 Q42022 Q12022 Q22022 Q32022 Q42023 Q1
Percent of AM/FM radio time spent with
digital streams of broadcast stations
0%10%20%30%40%50%60%70%80%90%100%
Ad-supported Amazon Music
Ad-supported Pandora
Ad-supported Spotify
Ad-supported YouTube Music
AM/FM radio
Monthly % reach of ad-supported audio among
adults 18+
3.Audio Number One in AudioMost listened to and loved content
41
Technology is a key driver of digital growth in the audio
ecosystem
Global Hearable Market Size
1
USA Smart Speakers & Connected Devices
2
Source:
1
https://www.zionmarketresearch.com/report/hearable-market
2
Jacobs Media Tech Survey 2023. % who own a working radio at home that they use vs. own a smart speaker vs. have downloaded theirP1 station app.
The growth of ‘hearables’ (in ear, Bluetooth like Apple AirPods) now a
societal norm. People are using these to stream audio as they go about
their day.
Whether it is smart watches, Apple/Android car play, connected TVs and
appliances, or smart speakers –there are more devices enabled with voice and
audio creating more moments for audiences to stream audio. Devices where
listeners can engage via their voice presents new advertising opportunities –
the digital ‘click’ for radio.
88%
83%83%
81%81%81%
78%
11%
21%
27%
33%
35%35%
38%
26%26%
31%
34%
37%
39%39%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2017201820192020202120222023
Own a Radio at HomeSmart Speaker OwnershipDownloaded P1 Station App
3.Audio Number One in AudioMost listened to and loved content
42
Audio consumption in NZ now equals TV/video
Radio reaches 72% of New Zealanders each week
Source: The Infinite Dial, 2023. Total New Zealand Population 16+. % doing activity in the last week
92
92
76
72
31
Watch TV/video
Listen to audio
Use social media
Listen to radio
Listen to podcasts
Weekly Media Consumption
3.Audio Number One in AudioMost listened to and loved content
43
Commercial radio audience levels have been strongly
enduring and consistent
3.4million New Zealanders listen to commercialradio each week
1
and listen on
average for 15 hours 19minutes each week
2
Source:
1
GfK, RAM, Total NZ, S2 2023, Mon-Sun 12mn-12mn, Cumulative Audience AP10+.
2
GfK, RAM, Total NZ, S2 2023, Mon-Sun 12mn-12mn, Time Spent Listening AP10+.
3
GfK, RAM, Commercial Radio,
S1/2017-S2/2023,Major Markets, M-S 12mn-12mn, Cumulative Audience (000s), AP10+*Radios 2013-2016(NZ Major Markets include Auckland, Wellington, Christchurch, Northland, Waikato, Tauranga, Rotorua,
Hawke's Bay, Taranaki, Manawatu, Nelson, Dunedin and Southland.) Total NZ Audience has only been surveyed since 2017 therefore regional (ie. non major market) audience is excluded from this chart)
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
1-20132-20131-20142-20141-20152-20151-20162-20163-20161-20172-20173-20174-20171-20182-20183-20184-20181-20192-20193-20194-20191-20203-20204-20201-20212-20213-20214-20211-20222-20223-20224-20221-20232-2023
Audience (000's)
Cumulative Audience -NZ Major Markets only (000’s)
3
All Radio Major MarketsPopulation Major Markets
3.Audio Number One in AudioMost listened to and loved content
•Major markets is the top 13
markets in New Zealand
•This has show growth since
2013 and remains extremely
consistent
44
Monthly digital audio consumption in NZ is similar to
international markets with an opportunitytomonetisea
younger audience
Digital audio consumption has been growing internationally over the past six years.The highest consumption
is occurring in16-34 year olds,with 94% consumingeither digital radio or unique streamed audio content in
a month.
Source: The Infinite Dial, 2023.Monthly Online Audio Listening, Total Population 16+, % listened to online audio in last month. Online Audio = Listening to AM/FM radio stations online and/or listening to
streamed audio content available only on the Internet
77
94
80
59
Total 16+Age 16-34Age 35-54Age 55+
NZ Online Audio Consumption By Age
61
63
66
69
68
73
75
53
52
59
66
72
77
80
7777
2017201820192020202120222023
NZ Online Audio Consumption vs International Markets
U.S.AusNZ
3.Audio Number One in AudioMost listened to and loved content
45
NZME has a wide and competitive range of audio
offerings
Audio ecosystem extends beyond traditional radio with growing content offerings
across local and international publishers
BrandRadioMusic StreamingPodcast Platform
Terrestrial
Radio
Simulcast
Digital Radio
Subscription
Music
Ad funded
Music
Catch-up
Radio
Original
Local
Original
International
Audio App
NZME
✓✓
Playlists &
Digital Only
Radio
✓✓✓
iHeartRadio
MediaWorks/Rova
✓✓
Digital Only
Radio
✓✓✓
rova
RNZ
✓✓✓✓
RNZ
Stuff
✓
Spotify
✓✓✓✓
Spotify
Apple
✓✓✓
Apple Music
& Apple
Podcasts
YouTube (music and
video)
✓✓
YouTube
Music
Amazon
✓✓
Amazon
Music
Acast
✓✓
3.Audio Number One in AudioMost listened to and loved content
46
50+NZME Original
Owned or Partner
Podcasts.
18launched 2023
30+catch up radio
show podcasts
60M+ music tracks
through Artist Radio
50+ locallycurated
playlists
2,300+
international
playlists
We are active in
27 markets
147 commercial
radio stations and
55 local partner or
digital only stations
Premium international
content with over
550k+ podcasts
available on
iHeartRadio
BROADCAST
& DIGITAL STREAMING
DIGITAL
EXCLUSIVE
NZME has a diverse audio content offering
3.Audio Number One in AudioMost listened to and loved content
47
•Brand portfolio incorporating leadingtalk and music formats
•2 million listeners every week
1
•NZ's leading podcast publisher 25 months in a row
2
•NZME was the leading company at the 2023 NZ Radio
Awards, winning six of the eight premier awards, including :
•Station of the Year -Newstalk ZB
•Best Network Team Show -Fletch Vaughan & Hayley,
ZM
•Broadcaster of the Year –Mike Hosking, Newstalk ZB
Source:
1
GfK, RAM, Total NZ, S2 2023, Mon-Sun 12mn-12mn, Cumulative Audience AP10+.
2
Triton Digital NZ Podcast Ranker, Sep 2023
NZME’s leading audio brands target all New Zealanders
RADIO BROADCAST CONSUMED DIGITALLY
AUDIO PLATFORM
DIGITAL ONLY AUDIO CONTENT
RADIO BROADCAST CONSUMED DIGITALLY
AUDIO PLATFORM
DIGITAL ONLY AUDIO CONTENT
3.Audio Number One in AudioMost listened to and loved content
48
Source:
1
GfK, RAM, Commercial Stations, NZME ,Cumulative Audience (000s), Total NZ S1 2020-S2 2023 AP10+.
2
GfK, RAM, Commercial Stations, NZME ,Market Share, Total NZ S1 2020-S2 2023 AP10+.
3
Adswizz
Audio Metrix, Spreaker& Triton Omny
0
5
10
15
20
25
30
35
40
S1/2020S3/2020S4/2020S1/2021S2/2021S3/2021S4/2021S1/2022S2/2022S3/2022S4/2022S1/2023S2/2023
NZME Radio Share
(Total NZ All 10+ Share)
2
NZME Music Market ShareNZME Talk Market Share
-
500
1,000
1,500
2,000
S1/2020S3/2020S4/2020S1/2021S2/2021S3/2021S4/2021S1/2022S2/2022S3/2022S4/2022S1/2023S2/2023
Weekly Listeners (000’s)
NZME Radio weekly listeners
(Total NZ All 10+ Cume)
1
NZME radio audience has normalisedpost Covidand
digital audio continues strong growth
m
1m
2m
3m
4m
5m
6m
7m
8m
9m
10m
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
Jul-22
Aug-22
Sep-22
Oct-22
Nov-22
Dec-22
Jan-23
Feb-23
Mar-23
Apr-23
May-23
Jun-23
Jul-23
Aug-23
Sep-23
Monthly Listening hours (millions)
Digital Audio Total Listening Hours
(million)
3
PodcastsDigital Radio
3.Audio Number One in AudioMost listened to and loved content
49
Listening via connected devices, including smart speakers,
is now larger than desktop/laptops
Source:
1
Adswizz Audio Metrix –all commercial inventory.
2
Infinite Dial new Zealand 2023 Smart Speaker Ownership 16+
•Whilst Mobile remains the primary device,
connected device listening is the fastest
growing platform
•Smart Speaker ownership in NZ is still some
way behind global markets with ownership
currently at 22%,USA at 36% and AUS 28%
respectively
2
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
20192020202120222023
Millions
Monthly Average Total Listening Hours By Device
1
MobilesDesktopSmart Speakers & Other
3.Audio Number One in AudioMost listened to and loved content
50
Source:GfK, RAM, Commercial Radio,S2 2023, Total NZ, M-S 12mn-12mn, Cumulative Audience (000s), AP10+.
NZME
MediaWorks
•Newstalk ZB is the number
one station in New Zealand
for both cumulative audience
and share of listening
•ZM has the most listeners in
the key 25-54 demographic
Coast
Flava
Gold
Hokonui
Newstalk ZB
Hauraki
Hits
ZM
Breeze
George
Mai
More
Edge
Magic
Rock
Sound
253035404550556065
More Female | More Male
Average Age
NZME’s focus is on The Hits and Coast to close the gap in
the 40-50 demographic, while growing overall audience
3.Audio Number One in AudioMost listened to and loved content
51
•Six consecutive 10+ audienceshare
increases
2
•48% growth in iHeartRadio
Total Listening Hours 2020
vs 2023
3
•New Drive show to be launched
in 2024
The strategy to grow The Hits audience
is working and will continue.
The Jono & Ben network breakfast show
and a revised music policy has in 2023
delivered The Hits’ highest cumulative
audience since the brand’s launch in
2014.
1
THE HITS TOTAL NZ STATION SHARE
2
JONO AND BEN BREAKFAST SHARE
4
Source:
1
GfK, RAM, Commercial Radio,S1 2023, Total NZ, M-S 12mn-12mn, Cumulative Audience (000s), AP10+
2
GfK, RAM, Commercial Radio,S4-2021 to S2-2023,Total NZ, Station Share M-
S 12mn-12mn, AP10+.
3
Adswizz Audio Metrics Jan-Sep 2020 v Jan-Sep 2023.
4
GfK, RAM, Commercial Radio, S4-2021 –S2-2023, Total NZ, Station Share M-F 6am-9am, AP10+
Focus Brand: The Hits
3.Audio Number One in AudioMost listened to and loved content
52
•Audience share growth in the
three major metro markets
1
•30% growth in iHeartRadio
Total Listening Hours 2020
vs 2023
2
•Lifestyle and wellness podcast
series We Need To Talk with Toni
Street has delivered more than
350k downloads since launch
3
Talent and content changes
implemented in 2021/22 are now
delivering audience share growth
Source:
1
GfK, RAM, S1-2022 to S2-2023,AKL, WGT, CHCH, M-S 12mn-12mn, Station Share AP10+.
2
Adswizz Audio Metrics Jan-Sep 2020 v Jan-Sep 2023
3
Triton OmnyMay 2022 –
September 2023
0
1
2
3
4
5
6
7
S1-2022S2-2022S3-2022S4-2022S1-2023S2-2023
AP10+ Share -Auckland
0
1
2
3
4
5
6
S1-2022S2-2022S3-2022S4-2022S1-2023S2-2023
AP10+ Share -Wellington
0
1
2
3
4
S1-2022S2-2022S3-2022S4-2022S1-2023S2-2023
AP10+ Share -Christchurch
Focus Brand: Coast
3.Audio Number One in AudioMost listened to and loved content
53
PLAYLISTS
Create your own playlist or
discover from 1,000s curated here
in NZ or from across the world.
TALKBACK
Send a voice note directly to your
favourite show or host directly from
the iHeartRadio app
‘PODCATCHER’
Access and follow Podcasts from
NZME and other publishers here in
NZ and around the world
DIGITAL RADIO
Listen to local radio live on any
device as well as stations from
around the world
iHeartRadio functionality provides NZME with market
leading capability for audiences and advertisers
iHeartRadio provides benefits listeners can’t access anywhere else, with native integration into more than
250 devices and eco-systems. Since launch, 1.3 million New Zealanders have registered for an iHeart
account
3.Audio Number One in AudioMost listened to and loved content
54
Create the most listened
to and loved audio
content
Key areas of focus
•Grow market share with The Hits and Coast
•Leverage iHeartRadio functionality and roadmap
•Grow total digital audience further
•Be seen and heard on all platforms and devices
Create the most listened
to and loved audio
content
Create the most listened
to and loved content
3.Audio Number One in AudioMost listened to and loved content
55
Create the most listened
to and loved content in
NZ
Grow podcast
engagement and
monetisation
There are three pillars to the Audio strategy
Number One in Audio
Deliver customer
solutions to grow
revenue share
3.Audio Number One in AudioStrategy
56
iHeartMedia USA has experienced rapid growth in
digital revenues, now 28% of revenue
•iHeartMedia is the leading audio media company in the USA based on
consumer reach. iHeartMedia reach 9 out of 10 Americans every
month, 2 x the reach of the largest TV Network, 4 x the reach of the
largest ad-enabled streaming music audio service
•Digital revenues comprised 28% to 30 June 2023. FY2022 they were
26%, up from 23% in 2021. Podcasting revenue continues to grow and
now makes up 10% of Audio revenue
•iHeartRadio’s product strategy is ‘to be where our listeners are with the
products and services they expect from us regardless of where they are
and what platforms they're using
•iHeartRadio is the number one podcast publisher and is twice the size of the next largest commercial podcast publisher as measured by
audience, according to Podtrac. It is the podcast industry leader with 420 million downloads in August 2023 alone, more than double its
nearest competitor Amazon’s Wondery(188 million), NPR (166 million)and The New York Times (116 million)
Source: iHeartMediaTradesite, iHeartMedia Inc Q2 2023 Investor Presentation & PodtracAugust 2023
20232022
Revenue
($millions)
%Total
Revenue
($millions)
%Total
Revenue Total
1,7311,797
Radio
1,24772%1,33074%
Digital
(excluding
Podcasts)
31018%31217%
Podcast
17310%1549%
Revenue from contracts with customers six months ended 30 June:
Radio revenue includes Broadcast, Networks, Sponsorship & Events and Other
3.Audio Number One in AudioGrow revenue share
iHeartRadio is the foundational platform for NZME’s digital audio growth
57
Radio is significantly bigger than advertisers perceive
“The biggest risk for radio is the 26-year-old planner who ..... does not commute by car
and does not listen to the radio and thus does not think anyone else listens to the radio”
-Colin Kinsella, former CEO Havas Media, North America, Radio lnkForecast Conference
Source: Advertiser Perceptions, August 2023, 305 advertisers and agencies, perception = total ad-supported Pandora and ad-supported Spotify; Edison Research, "Share of Ear,” Q3 2022-Q2 2023. Persons 18+.
PERCEPTION
26%
17%
29%
69%
4%
4%
AM / FM radioAd-Support PandoraAd-supported Spotify
Perception of advertisers and agencies vs. actual share of ad-supported audio time spent
among persons 18+
PERCEPTION
PERCEPTION
REALITY
REALITY
REALITY
PERCEPTION
3.Audio Number One in AudioGrow revenue share
58
Source:PWC/RBA Revenue Reporting. NZME and MediaWorksonly. 2023F represents September YTD 2023annualised.
•The market is showing signs of
recovery in late 2023
•Direct relationships with clients
represents ~70% of revenues, with
media agencies delivering ~30%.
This is the inverse of many
international markets, resulting in
strong direct relationships with the
majority ofclients.
264
260
256
261
220
240
248
231
-
50
100
150
200
250
300
20162017201820192020202120222023F
NZ Radio Advertising Market Revenue $m
NZ market revenues were returning to pre-Covid levels
prior to 2023 recessionary impacts
3.Audio Number One in AudioGrow revenue share
59
NZME revenue market share growing
While the local market continues to be challenged due to economic conditions,
NZME has increased our market share in 2023
Source: PWC/RBA Revenue Reporting
3.Audio Number One in AudioGrow revenue share
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
Jan-21
Feb-21
Mar-21
Apr-21
May-21
Jun-21
Jul-21
Aug-21
Sep-21
Oct-21
Nov-21
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
Jul-22
Aug-22
Sep-22
Oct-22
Nov-22
Dec-22
Jan-23
Feb-23
Mar-23
Apr-23
May-23
Jun-23
Jul-23
Aug-23
Sep-23
Oct-23
NZ Radio Market Revenue and Share
NZME Total RevenueTotal Market minus NZMENZME Share
In addition to gaining radio
revenue market share, we
currently deliver over 70%
digital advertising revenue
market share versus our
main competitor
60
Source: NZME Revenue.
•Digital audio presents new products and
capabilities for advertisers to reach audiences
•Podcasting as a percentage of digital revenue
forecasted to be over 30% of digital audio
revenue where it was 5% in 2021
•NZME is able tocommericialiseall podcast
audiences and listeners regardless of the device
or platform they are heard on
NZME is at the forefront of the leading digital audio
commercial opportunity in market
Digital audio revenue largely driven by in stream advertising across digital radio, with
podcasting revenue rapidly growing
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
$-
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
$7,000,000
$8,000,000
$9,000,000
20162017201820192020202120222023F
Digital Audio Revenue
Digital Audio Revenue% of Total Audio Revenue
3.Audio Number One in AudioGrow revenue share
61
Core benefits of growth in data across product
offering:
1.Better content recommendation, surfacing
more relevant content creating more
engaged audience
2.Improved commercial capability with growing
advertiser demand for audience buying
(impression + data)
3.More relevant and effective advertising leading
to a better listening experience
Further personalisationof content will aid commercial
monetisation
Use data to create
personalisedvoice over sound
effects andmusic for each ad.
Using the datafrom each user’s
digitalfingerprintandiHeart
profile
Your brands message
with individual user
Content Recommendation
PersonalisedAdvertising
3.Audio Number One in AudioGrow revenue share
62
Live stream any NZME radio station or 100
other custom local & international radio
stations on the iHeart network
Stream music withiHeart’s
Playlists -ads are inserted in
between songs
Digital RadioMusic Streaming
NZME Podcast Network
Your ads in our podcast network, whereveryou get them
Monthly
Audience
includes watches,
Car play, Sonos
Available
On
Digital
Audio
Product
Connected devices Smart SpeakersRadio WebsitesiHeartRadio
CONTENT OWNERDOWNLOADSREACH
NZME Produced3,976,907728,090
iHeartRadio International
**
1,515,114289,229
Audioboom1,040,000362,720
SiriusXM904,608295,291
TOTAL (AGREGGATED)7,436,6291,675,330
49%
21%
26%
Sitting across all podcast players, the NZME
Podcast Network encompasses NZME
produced original podcasts, NZME radio
station catch-up, and exclusive reseller rights
to podcasts from our international partners
iHeartRadio USA, Sirius XM, Audioboomand
Australian Radio Network.
Playlists
Launched
Sep 25
th
DEVICE REACH
(doesn’t include co-listening)
1,308,279
Total Listening Hours:6,953,728
DEVICES
Mobile
63%
Desktop
15%
Speakers + Other
23%
4%
Source: AdswizzAudio Metrix, Triton Podcast Ranker, Triton Metrics * Q3 2023 aggregated listening to Artist Radio feature on iHeartRadio–Adobe **iHeart International covers content made by iHeartRadio and the ARN
Digital audio allows increased monetisationacross multiple
platforms
3.Audio Number One in AudioGrow revenue share
63
Key areas of focus
•Grow the total audio market revenue,accessing
TV revenues that are in decline
•Deliver integrated campaigns utilising NZME's
wider assets
•Increase data capability, accessing all ofNZME's
touch points
Deliver customer
solutions to grow
revenue share
3.Audio Number One in AudioGrow revenue share
64
There are three pillars to the Audio strategy
Number One in Audio
Grow podcast
engagement and
monetisation
3.Audio Number One in AudioStrategy
Deliver customer
solutions to grow
revenue share
Create the most listened
to and loved content in
NZ
65
Podcast revenues are projected to continue significant
growth
Despite economic headwinds, podcast ad revenues posted strong growth in
2022, +26% to $1.8B
Source : PwC | IAB FY 2023 Podcast Ad Revenue Study & PwC | IAB Internet Advertising Revenue Report
2023 estimate is $USD7 per
person in the USA
This equals a $35 million total
market opportunity for NZ
3.Audio Number One in AudioGrow podcast engagement and monetisation
66
0%
10%
20%
30%
40%
50%
60%
70%
80%
Social MediaYouTubeStreaming musicStreaming TVMoviesRadioPeace & QuietLocal / Cable TVBooks /
Magazines / Print
Physical Music
Podcasting is taking time and attention from other platforms
Has your podcast listening taken the place of time you used to spend with any of the following? (select all that apply)
Source: Survey results collected via Critical Mass Media. April,2023. n=500 respondents Monthly Podcast Listeners. P12-54
TikTok
Facebook
Instagram
USA listeners are giving up social media and video to listen to podcasts
3.Audio Number One in AudioGrow podcast engagement and monetisation
67
NZ podcast consumption is following international trends
Monthly podcast listening in NZ is ahead of USA/AUS. Predominantly driven by a younger demographic
with 60% of 16-34 year oldshaving listened to a podcast in the last month, 38% have listened in the last
week
Source: Infinite Dial NZ 2023, “Australia, USA and New Zealand Total Population 16+ % Listened To A Podcast In The Last Month”
46
60
49
32
0
20
40
60
Total 16+Age 16-34Age 35-54Age 55+
NZ Podcast Consumption By Age
24
25
33
36
41
38
42
17
18
22
26
36
40
43
39
46
0
20
40
60
2017201820192020202120222023
NZ Podcast Consumption vs International Markets
U.S.AusNZ
3.Audio Number One in AudioGrow podcast engagement and monetisation
68
Leading international podcast genres are well serviced by
NZME content
NZME major advantage in significant broadcasting and digital channels to support the promotion and
discoverability of podcast titles. Quality of content determines long-term success. Leading categories
internationally include Comedy, News and Sport
Source: WakewordStastia
NEWS & OPINION
COMEDY
SPORT
3.Audio Number One in AudioGrow podcast engagement and monetisation
69
-
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
Jan-20
Feb-20
Mar-20
Apr-20
May-20
Jun-20
Jul-20
Aug-20
Sep-20
Oct-20
Nov-20
Dec-20
Jan-21
Feb-21
Mar-21
Apr-21
May-21
Jun-21
Jul-21
Aug-21
Sep-21
Oct-21
Nov-21
Dec-21
Jan-22
Feb-22
Mar-22
Apr-22
May-22
Jun-22
Jul-22
Aug-22
Sep-22
Oct-22
Nov-22
Dec-22
Jan-23
Feb-23
Mar-23
Apr-23
May-23
Jun-23
Jul-23
Aug-23
Sep-23
NZME Produced Podcast Content Downloads
Source: Spreaker& TitronOmny
Podcast downloads have shown rapid growth
Year to date growth of 56% on 2022
3.Audio Number One in AudioGrow podcast engagement and monetisation
70
Source: Triton NZ PodrankerSep 21 –Sep 23
NZME is the largest podcaster in NZ
NZME has led every Podrankerfor 25 consecutive months. Total podcast downloads
within the NZME Commercial Network is over 14 times our nearest competitor
Rank NetworkSales RepresentationMonthly Listeners (CUME) Monthly Downloads
1NZME & iHeartRadio NZME Podcast Network1,017,319 5,492,021
2AudioboomNZME Podcast Network362,720 1,040,000
3Sirius XM Podcast NetworkNZME Podcast Network295,291 904,608
4rova (MediaWorks)rova (MediaWorks)211,107 517,714
5LiSTNR (SCA)LiSTNR (SCA)185,309 491,836
6Brodie Kane MediaBrodie Kane Media41,061 87,526
7Sports Entertainment Network (SEN)Sports Entertainment Network (SEN)28,822 117,491
8Studio71Studio7121,980 46,558
9Nova Entertainmentrova (MediaWorks)6,887 25,531
NZ Only
NZ Triton PodrankerSeptember 2023 –Top Networks
3.Audio Number One in AudioGrow podcast engagement and monetisation
71
Source:
1
Triton NZ PodrankerSep21-Sep23 for Commercial Network Downloads, Triton CMS NZME instance andSpreakerfor NZME Podcast Downloads
-
5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
2020 Q42021 Q12021 Q22021 Q32021 Q42022 Q12022 Q22022 Q32022 Q42023 Q12023 Q22023 Q3
NZME Podcast Commercial Network
NZMEPartner
Addition of Sirius XM
Content
Partner content provides NZME incremental reach
NZME not only generates revenue from content it makes, but also locally represents
some of the leading podcast publishers from around the world
3.Audio Number One in AudioGrow podcast engagement and monetisation
72
Key areas of focus
•Produce new content in line with international genre
preferences
•Continue to utilise NZME’s platforms to grow podcast
awareness and consumption
•Grow known podcast audience, by increasing consumption
through ‘owned’ iHeartRadio platform
•Leverage NZME’s leadership position to drive incremental
audio revenue
Grow podcast
engagement and
monetisation
3.Audio Number One in AudioGrow podcast engagement and monetisation
73
Number One in Audio
METRIC
H1 FY23
Actual
2026
Target
Audience share
(% of radio audience)
38.1%
1
>1% share point growth per annum
Revenue share
-Radio
-Digital
-Total
42.4%
2
_72.4%
3
43.0%>1% share point growth per annum
Digital audio revenue
(as a % of total audio revenue)
7%12%
EBITDA
4
Margin Target
(pre NZIFRS16)
12%
(FY23 15-17%)
15-17%
3.Audio Number One in Audio
Scorecard
1.GfK Commercial RAM, NZME excl. Partners, Total NZ, M-S 12mn-12mn, Market Share %, S1 2023, AP10+
2.Radio Broadcasters Association Monthly Radio Market Report, 12-month average to 30 June 2023 (H1 2023). Note: report excludes independent broadcasters, contra revenue, and digital audio.
3.Radio Broadcasters Association Monthly Radio Market Report, 6-month average to 30 June 2023 (H1 2023). Note: report excludes independent broadcasters and contra revenue.
4.EBITDA is a non-GAAP measure and excludes exceptional items.
74
PUBLISHING
75
Carolyn Luey
CHIEF DIGITAL AND PUBLISHING
OFFICER
4.Publishing
New Zealand’s leading news destination
76
News media landscape will
converge
•News media will be digitally led
•Newspaper, magazines, radio,
television will converge
•Media types: Text media, image
media, audio media, video
media, multimedia
4.Publishing
New Zealand’s leading news destinationBackground
The news media landscape continues to evolve. Global
publishers are preparing for a digital-only world
77
-
50,000
100,000
150,000
200,000
250,000
'15'16'17'18'19'20'21'22'23
FC
NZME Publishing Revenue by Source
2019: NZH Digital
Subscriptions introduced
Source: NZME Analysis
Print
Subscription
(32%)
Digital Subscription
(9%)
Digital Advertising
(28%)
Print Advertising (31%)
$M
NZME has started the transition to a
subscription-led business
New York Times continues to be the gold standard in the
global publishing market with more than 40% of revenue in
digital subscriptions
4.Publishing
New Zealand’s leading news destinationBackground
78
Print Centric Model
Audience
Local mastheads serving
distinct regional
footprints with stories
published online
Revenue
Local print subscribers
Local print advertisers
National digital advertisers
Digital Centric
Hybrid Model
Audience
Distinct digital free and
paid content with stories
published in print
Revenue
National digital subscribers
National digital advertisers
Local print subscribers
Local print advertisers
CURRENT
Separate Digital
and Print Model
Audience
Distinct digital free and
paid content then
curated into print
publications by a
dedicated print hub
Revenue
National digital subscribers
National digital advertisers
Local print subscribers
Local print advertisers
Digital Only Model
Audience
Distinct digital free and
paid content
Revenue
National digital subscribers
National digital advertisers
Q4 23+
We have shifted into the next horizon of our digital
transformation by creating separate digital teams
4.Publishing
New Zealand’s leading news destinationBackground
79
Publisher Median
69595764
NZME performs well across the different drivers of
sustainability versus the global publisher median
Source: Google News Initiative / FT Strategies Publisher Sustainability Diagnostic, inputs NZME Publishing FY22
NZME scores higher than 90% of publishers
across the world on the Google News Initiative
Publishers Sustainability Diagnostic
Financial
Product &
Audience
MonetisationFoundations
Key opportunity is to grow audience and engagement
through focus on editorial and product platforms
NZME’s Publishing business is well placed for the future
and benchmarks higher than 90% of global publishers
4.Publishing
New Zealand’s leading news destinationBackground
80
New Zealand’s leading news destination
Expert journalism
that grows
subscriber lifetime
value
High quality and
efficient print
business
Scalable digital
audience and
advertising News
platform
There are three pillars to the Publishing strategy
4.Publishing
New Zealand’s leading news destinationStrategy
81
New Zealand’s leading news destination
Expert journalism
that grows
subscriber lifetime
value
High quality and
efficient print
business
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
Scalable digital
audience and
advertising News
platform
There are three pillars to the Publishing strategy
82
NZME’s journalism reaches 3.3 million Kiwis each month
NZME Newsroom
300+ Expert Journalists
Nationwide Coverage
News Brand audience monthly reach of 2.5M
1
•Digital reach of 1.85M
2
•Print audience of 1.54M
3
NZ’s biggest commercial radio station with a reach
of 677K
4
•NZ’s biggest daily newspaper
3
•NZ’s biggest Sunday newspaper
3
•Biggest share of regional newspaper readership
3
Rich portfolio of digital subscriptions with 220K+
readers
Award winning journalism:
Source:
1
Nielsen CMI Q3 22 –Q3 22 July 2023 Fused AP15+. Monthly coverage for Daily & Community titles, Weekly coverage for Newspaper Inserted Magazines, Monthly UA for Digital, Weekly Reach for Radio (GfK RAM S2 23). Note: Fused data has potential for duplication.
2
.
Nielsen Online Ratings July 2023 AP15+ ,
3.
NielsenCMI Q3 22 -Q2 23 AP15+.
4
GfK RAM, Total NZ, S2 2023, M-S 12mn-12mn, AP10+, Cume.
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
83
83
83
84
84
84
New Slide: Combine 4 slides into 1.
85
85
85
New Slide: Combine 2 slides into 1
86
86
86
News Worth Knowing aims to boost presence
and familiarity nationwide, to ensure the Herald is front of mind
and known as a modern, trusted source ofnews, views and
opinion.
Our brand strategy is to;
•Build the brand code with highly distinctive assets
•Build the brand experience across product and customer
touchpoints
RESULTS:
-Campaign recall has now surpassed 55%
-Those exposed to the brand campaign show an
11% increase in propensity to subscribe
-Across NZ, the gothic ‘H’ is recognisedby 88% of people.
87
87
87
TRUSTED JOURNALISM
‘When it’s news you can trust, it’s News
Worth Knowing’
ENGAGING LIFESTYLE
Reviews Worth Knowing
Recipes Worth Knowing
Destinations Worth Knowing
Tips Worth Knowing
NEW ZEALAND’S HERALD
Waikato News Worth Knowing
88
Editorial Dashboard: Article Scoring Engine / Monthly Reporter Scorecard / Performance Benchmarks
User Needs Content Model
Video
Live News
Fact vs Opinion
Trending and Evergreen
Explainer Journalism
Trusted quality journalism delivering on the business of news
Audio
Distribution Optimisation (existing and emerging channels)
Live Feed
Expand Personalisation
Reader Utility Features
Progressive Value Exchanges
Platform Foundations; Identity, Recommendations, Dynamic Engine
Expand Audiences
Regional
Lifestyle
Next Generation
Diverse
Audience Segmentation
Data Foundations
Content Planning, Production and Programming
Update MeEducate MeInspire MeConnect Me
Immersive Content Experiences
Deeper Reader Relationships
Expanding audience reach and engagement through
six priorities
1
Data foundations will
deliver deeper audience
and content insights to
inform editorial decision
making
2
Expand audiences by;
•Producing stories and
perspectives targeted
at key segments
•Creating engaging
and relevant product
experience
•Growing brand
preference
3
Content planning,
production and
programming will focus
on delivering right mix of
stories, at the right time,
in the right channels
based on user needs and
behaviours
4
Immersive content
experiences to enhance
story telling and leverage
technology enabled
production to meet
different user
preferences
5
Builddeeper reader
relationships by
building a richer
understanding of
readers to deliver more
relevant content
experiences and next
best action
6
Moderniseplatform
foundations to create
scalable platform for the
future
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
1
2
3
4
5
6
89
•Daily editorial scoring report to
understand top and bottom
performing articles
•Monthly reporter scorecard to
identify opportunities to improve
quality and output
•Editorial dashboard to deliver
audience and traffic insights and
competitive benchmarks
•User behaviourheatmaps to inform
optimal publishing times for traffic
and conversions
•Content insights to identify
opportunities for evergreen content,
trending topics and new angles on
stories
Monthly Reporter Scorecard
Data foundations: utilisedeeper audience and content
insights to inform editorial decision making
1
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
90
•Build deeper relationships with
regional readers
•Herald branded regional editions
and product experience
•100% locally relevant content and
business advertising
RegionalLifestyle & TravelNext Generation
•New operating model to focus
on digital-first readership
•Expand topics within reporter
rounds to grow and engage
audiences.
•Grow engagement through
better search and user
experience
•Build on ‘What The Actual?!’ social
presence, expansion into a
newsletter and podcast
•Create new formats based on
younger generations news
consumption habits
Expand Audiences: strategic focus on regional, lifestyle
and next generations to fuel audience expansion
2
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
91
Expand Audiences: continue to expand the diversity of our
journalism and audiences, building on the success of Kāhu
2
Kāhu will be one of New Zealand’s leading
mainstream platforms for Māori stories
Quality
Content
Community
Engagement
New Talent
Partnerships
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
92
Inspire Me
•e.g.Travel “The ultimate
guide to Champagne in
France: cellars, stay, and
sip”
Connect Me
•e.g.Recipes “Weeknight
wonders: Threeeasy and
delicious weeknight
meals.”
Educate Me
•e.g.Explainers ”Welcome
back, westerlies: What
winter wind-change means
for you.”
Update Me
•e.g.Live news “Auckland
floods live updates:
Northland declares state of
emergency”
KNOW
(Fact Driven)
UNDERSTAND
(Context Driven)
FEEL
(Emotion
Driven)
DO
(Action Driven)
Key benefits;
•Unlock new story angles
•Shift from commoditised
‘update me’ content to
stories with stronger
performance
•Actionable and measurable
leveraging ‘large language
model’ to categoriseall
stories
•Newsroom wide adoption
Content Planning –the user needs planning framework will drive
a greater focus on delivering stories through an audience lens
3
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
93
Live News
Experience
Vertical Video
Experience
Text to Speech Audio
Experience
Summaries
Created by AI
Created by AI
Immersive Content Experiences: enhanced story telling and
create different formats based on reader preferences
4
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
94
Redesigned homepage with multiple variants
80% of top 15 stories will be curated for
segments to drive relevancy
1 to 1 personalisedmodules
Development of browsing and location models will
continue to improve performance of
recommendations
Deeper Reader Relationships: multiple homepage variants
5
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
Curated segments combined with personalisation to optimisecontent discovery
95
More Known Users
Subscriber / Reader
Activation
Machine Learning /
Predictive Models
More registered users with
logged in behaviour
Propensity to buy
Propensity to churn
Next best action
Grow subscribers
Grow reader engagement
and nurture to subscribers
Richer User Profiles
Look A Like /
Predictive Models
Advertiser Activation
Progressive profiling to build
out intent, trends & tastes
Scale audience targeting
through finding similar users
Enhanced audience
targeting to improve
campaign results
Deeper audience insights for
advertisers to drive
rebooking
Predictive models on user
sentiment / motivations
based on article content
Deeper Reader Relationships: growing 1st party data is key to
unlocking more subscribers and advertising revenue
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
5
96
Modernise Platform Foundations: to create a scalable
platform for the future and enhanced customer experience
•Single sign on convenience
cross platform
•Privacy safe frictionless
experience
Identity
Recommendations
Dynamic Engine
•Recommendations as a service
across domains / platforms
•Audience engagement and
recirculation keeping them
inside NZME’s ecosystem
•Next best action engine to
create a personalisedcustomer
experience
•Drive engagement funnel to
increase conversion
Future proofed scalable platform to enable rapid extensions in the future
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
6
97
24%
24%
25%
25%
27%
26%
-
40
80
120
160
200
240
FY18FY19FY20FY21FY22Current
Market revenue $m
Total Digital Display Advertising Market Revenue
and NZME Share %
1
Market Revenue $mNZME Share
NZME’s digital audience and platform delivers the digital
advertising revenue opportunity
1.IAB Digital Advertising Revenue, Digital Display includes video, audio, sponsorship, native and display.
2018 –2022 rolling 4-quarter average to 31
st
December. 2023 NZME share for 6 months to 30 June 2023
AUDIENCE AND PLATFORM
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
98
Advertisers are seeking out quality brand safe environments
that deliver results through reduced emissions
Active Attention
Looking directly at the ad on mobile
Passive Attention
Eyes on screen not the ad
•Well known NZ local
brand
•Trusted content
•Transparency
•Advertisers increasingly
looking to achieve
sustainability goals and
reduce waste
•Buyers seeking out low
carbon media
•Focus on reducing ad
supply chain
Quality brand safe
scalable environments
that deliver client
results
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
99
IndividualsGroups of PeopleEnvironments / Interests
Contextual
NZME’s 1
st
Party
Data Segments
Logged in users
Shared ID
Solutions
3
rd
party
interest topics
Match customers
via clean rooms
Target contextual
information on site
•Context
•Sentiment
•Affinities
Target segments
•Profile
•Location
•Interest
•Intenders
(Off Network Ext)
Target broad topics
1
st
party data enabled products and quality intent based
contextual environments will be critical in a cookielessworld
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
100
Portfolio of e-commerce ad solutions offering immersive
shoppable experiences that align to the path to purchase
4.Publishing
New Zealand’s leading news destinationScalable digital audience and advertising news platform
Awareness
Discover
Evaluate
Purchase
Engage in live
shopping event
Purchase from
content on NZH
Purchase
from ad unit
on NZH
Read review on
The Selection
Engage with video
content and select
path of interest
Click on relevant
product deal in ad
unit
Shoppable
Content
Shoppable Pre
Roll Video
The Selection
Product Reviews
Interactive
Content Video
ShopmeFeed
Driven Ads
101
New Zealand’s leading news destination
Expert journalism
that grows
subscriber lifetime
value
High quality and
efficient print
business
4.Publishing
New Zealand’s leading news destinationExpert journalism
Scalable digital
audience and
advertising News
platform
There are three pillars to the Publishing strategy
102
NZ Population
5M
NZME
Subscriptions
221K*
Total Addressable Market
News Subscription Potential
1M
NZ-Expat
6.5M
•Sizable addressable market for news subscriptions
in NZ
•NZME subscriptions now at 221K inclusive of 179K
digital subscriptions
•Opportunity for further growth as category
continues to grow in maturity in NZ
Source: Census, INMA Benchmark for News Subscription Potential, NZME Data *NZME Subscriptions includes Print only
179K
The total addressable market for news in NZ is significant,
while our digital subscriptions continue to grow as the market
evolves
4.Publishing
New Zealand’s leading news destinationExpert journalism
103
•Individuals: stimulate volume through dynamic offers based on
propensity to buy and annual price increases
•Corporates: balancing corporate growth with the
cannibalisationof individuals by removing ‘unlimited user’ plans
and reducing bulk user discounts
•Individuals: monthly and annual prices increased, drive
acquisition and retention with annual Wall Street Journal
bundle / monthly bundle with Herald Premium
•Corporate: lift yield year on year from corporates as user
activation and engagement grows
As the digital subscription base has grown and the mix has
changed, balancing volume and yield has become
increasingly important for profitability
4.Publishing
New Zealand’s leading news destinationExpert journalism
Source: NZME Analysis.
104
SOURCE: INMA Q2 2023 Benchmark Survey vs Herald Premium Subscription Benchmarks includes individuals and corporates. INMA GlobalPublishing Benchmark Worldwide Median
Subscriber Penetration
Rate
Monthly ARPUPaid Stop
Conversion Rate
Monthly Churn
Rate
Measure
International
Benchmark
(Median)
3.23%$8.36 (USD)0.15%3.9%
Herald Premium
5.3%$7.65 (USD)3.2%0.74%
Status
20.5%
25%
Paywall Stop Rate
Above
Top Quartile
Below
Median
(due to exchange rate)
Upper Quartile
Median
Median
Herald Premium subscriptions are performing well
versus global publishing benchmarks
4.Publishing
New Zealand’s leading news destinationExpert journalism
105
Introduction
2019 -2020
Early Growth
2021 -2023
Scaled Growth
2024 -2026
Launch new paywall as
minimum viable product
Newsroom adapt to change
in focus from audience to
conversions
Marketing and technology
lead
Focus on product market fit
–expansion into verticals
Newsroom have clear view
of the types of content that
converts and engages
Adjust operating model to
cross functional squad to
manage increased
complexity
Building viable
proposition and solid
customer base
Focus on growing volume
of subscribers
Technology enhancements to
build scalable platform to
optimiseconversion and yield
Newsroom focused on
users needs, developing
new formats and methods
Reinvention of operating
model and the addition of
new talent and capabilities
to focus on execution of
reader revenue strategy
Focus on growing recurring
revenue and optimising
volume
Primary Goal
Priority
Focus Areas
Evolution of reader revenue strategy to accelerate growth,
reinvention and investment is required
4.Publishing
New Zealand’s leading news destinationExpert journalism
10
6
106
10
6
107
Grow brand awareness
•Increased from 44% to
54%
•Portfolio of podcasts to
engage new audience in
BusinessDesk content
Grow subscriptions
•Aligned reporter rounds to
key growth industry
verticals
•Wall Street Journal bundle
to drive acquisition and
retention
Enhanced utility
•Launched new app to
deliver greater utility
•Grow AI and data
capabilities
BusinessDesk has grown 80% since acquisition, with a strong
pathway for further growth
4.Publishing
New Zealand’s leading news destinationExpert journalism
108
•Leverage the strength of the Newstalk ZB
audio brand and opinion from the Breakfast
and Drive shows
•Targeting an audience craving clear,
constructive analysis and opinion on the
issues that matter to help inform their views
•A standalone subscription offering that can
be bundled with NZME’s other subscriptions
•Enrich the content proposition and features
to build subscriber engagement and value
Market gap for a publishing
proposition for our ZB audience
ZB Plus was launched to address the gap in the market
for an opinion-heavy platform that resonated
4.Publishing
New Zealand’s leading news destinationExpert journalism
109
Broaden the addressable market by building out subscriber
centric product and verticals
•Continue to build out
subscription portfolio through
build, partner, buy strategy
•Deliver increased utility and
features to drive value
perceptions e.g.puzzles,
quizzes, article sharing, live
events
•Introduce new product types
aligned to specific user needs
e.g.International, app only,
podcasting
4.Publishing
New Zealand’s leading news destinationExpert journalism
110
Build dynamic offers and a connected customer
experience to maximisesubscriber lifetime value
4.Publishing
New Zealand’s leading news destinationExpert journalism
Unknown User
Logged In User
One Subscription
Multiple
Subscriptions
Super Bundle
Upsell
Upsell
Upsell
Upsell
Time
ARPU
Reward
Reward
Reward
Dynamic
Connected
Experience Layer
•Next best article
•Registration gate
•Subscribe to
newsletter
•Personalisedcontent
recommendation
•Next best action –
download app /
newsletter opt in to
drive engagement
•Personalised
subscription offer
based on behaviour–
Day Pass, Vertical
Subscription
•Next best action to
reduce churn risk –
content of interest /
newsletter topic
•Cross sell offers
across key journey
touch points
•Upsell offers to
annual
•Promote exclusive
subscriber benefits –
commenting, live
stream
•Upsell value offer to
upgrade to all access
•Promote exclusive
subscriber benefits to
drive engagement and
value perceptions
•Surprise and delight
for loyal subscribers
111
New Zealand’s leading news destination
Expert journalism
that grows
subscriber lifetime
value
High quality and
efficient print
business
4.Publishing
New Zealand’s leading news destinationHigh quality and efficient print business
Scalable digital
audience and
advertising News
platform
There are three pillars to the Publishing strategy
112
NZME’s print business continues to drive strong audiences
and serve our readers across the North Island
4.Publishing
New Zealand’s leading news destinationHigh quality and efficient print business
NZME Community Newspapers
Weekly audience: 223,000
Source: Nielsen CMI Q3 22 –Q2 23.
1,039,000 weekly readers
62,000 weekly readers
27,000 weekly readers
87,000 weekly readers
65,000 weekly readers
42,000 weekly readers
NZME Daily Metro and Regional Newspapers
1.54M
monthly print
readers
113
45%
47%
47%
47%
47%
47%
0%
10%
20%
30%
40%
50%
0
50
100
150
200
250
300
FY18FY19FY20FY21FY22Current
Market Share %
Market Revenue ($m)
Total Print Advertising Market Revenue and
NZME Share %
2
Market RevenueNZME Share
1.NZME analysis
2.PwC NPA quarterly performance comparison report, 2019 –2022 rolling 4-quarter average to 31st December. 2023 NZME share for 9 months to 30 September 2023.
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
201820192020202120222023F
($millions)
Print Reader Revenue 2018 to 2023F
1
Print Subscription RevenuePrint Retail Revenue
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
0m
1m
2m
3m
4m
5m
6m
7m
8m
9m
10m
Q1 2019Q3 2019Q1 2020Q3 2020Q1 2021Q3 2021Q1 2022Q3 2022Q1 2023
Q3 2023F
Yield Per Newspaper per day
Newspapers Delivered per Quarter
Print Subscription Volume vs. Yield
2019 -2023F
1
Newspaper Subs VolumeNewspaper Subs Yield
•Print advertising market stabilisedbut H1
FY23 the market has softened with a 13%
YoY decline
•NZME share remains strong at 47%
•Print reader revenue FY23 forecasted
decline of 6% YoY
•Costof living and weather events have
impacted volumes in FY23
•Cover price increased in H1 to $4.50 M-F, Sat
$5.00
•Average subscription price remains well below
cover price
•Individual subscriberpricing continues to be
reviewed annually
Print revenue trend continues, with challenging market
conditions contributing to the predicted decline in FY23
4.Publishing
New Zealand’s leading news destinationHigh quality and efficient print business
114
MaximiseRevenue
Streamline Production
Strategic Synergies
Reader Revenue
•Maximiseyield improvement programme
•Up sell to digital, create unique proposition
to drive uptake
•3
rd
party partnerships to grow base
Advertising Revenue
•Simplify product and packaging to make it
easy to sell
•Align yield and reach across the week to
maximiserevenue
•Targeted print focused sales model
High Quality and Efficient
•Standardiseproduct layouts and design features
•Simplify, outsource and automate processes
•Maintain multiple suppliers to de-risk market consolidation / contraction
Industry Print Collaborations
•Explore opportunities to consolidate print capabilities to create synergies
•Optimiseprinting location and distribution to reduce costs
•Grow 3
rd
party print and distribution revenues to reduce fixed cost burden on NZME products
Our business will be focused on maximisingrevenue,
streamlining production while exploring strategic synergies
4.Publishing
New Zealand’s leading news destinationHigh quality and efficient print business
115
Print Supply ChainPrint PlantDistribution
Current State
Future State
•Diversified newsprint
supply chain
•New ink and plate
suppliers –aligned with
other NZ Printers
•Volume based driven
costs
•Actively manage supply
chain partners for
continuity of supply
•Industry collective
negotiation to achieve
benefits of scale
•Print plant located at
Ellerslie
•Equipment is
maintained by expert in-
house team
•Lease on Print Plant
expires in 2029, with
option to extend
•Option to
decommission part of
plant as volume declines
•Distribution franchise
network is managed by
expert in-house team
•Actively growing third
party volume to offset
decline
•Actively manage
distribution contracts to
maximiseflexibility
NZME is well positioned to manage the print business
through the next phase of the lifecycle
4.Publishing
New Zealand’s leading news destinationHigh quality and efficient print business
116
New Zealand’s leading news destination
Expert journalism
that grows
subscriber lifetime
value
High quality and
efficient print
business
4.Publishing
New Zealand’s leading news destination
Scalable digital
audience and
advertising News
platform
117
DigitalPrint
Metric
H1 FY23
Actual
FY26
Target
H1 FY23
Actual
FY26
Target
Subscription
Volume Target123,000190,00090,000>65,000
Advertising
Revenue Mix48%60%52%40%
EBITDA
3
Margin Target
(pre NZIFRS16)
~8%14-16%~19%13-15%
New Zealand’s Leading News Destination
Scorecard
4.Publishing
New Zealand’s leading news destination
118
ONEROOF
119
5.OneRoofYour essential property platform
Greg Hornblow
CHIEF OF ONEROOF
120
Your essential property platform
There are three pillars to the OneRoof strategy
Superior listings
experience and
performance
Grow listingsrevenueAccelerate non-listings
portfolio
5.OneRoofYour essential property platform Strategy
121
Scale#1 in Australia, interest
also in India, US and
South EastAsia
#2 in Australia#3 in Australia#1 in USA
BackgroundFounded in 1995Founded in 1996 as print
publication, online portal
in 1999, scaled up in 2014
Founded in 2001,
increased investment and
focus from 2020
Founded in 2006, rapid
expansion in 2008, listed
in 2011
Key stakeholderNewsCorp (61%)Nine Entertainment (60%)Australian Community
Media, ANZ, Seven West
Media
Focus16 plus brands in
portfolio including
marketing insights and
mortgages, strategy
accelerated through
acquisition
Similar toREA but driving
a more diverse
marketplace model,
smaller scale
Embraced total
marketplace model and
offmarket property sales
Wide range of property
related adjacent services
EV/EBITDA3024n/a15
International portals have developed clear roadmaps for
business growth, embracing total marketplace model
5.OneRoofYour essential property platform Strategy background
122
Real estate is New Zealand’s preferred investment asset
In New Zealand there are
1
:
140,000
MOVERS
924,000
FIRST HOME BUYERS
1,150,000
RENOVATORS
664,000
INVESTORS
Source:1.Nielsen CMI Q3 22 –Q2 23 August 23 Fused AP15+. Investors –expect to buy/sell/build n12m. FHB –AP25+ and in paid employment and current living arrangements (living with housemates or border or living with
extended family or living with parents and/or siblings or rented). Renovators –homeowners and home improvements n12m. Movers –homeowners and buy a property I live in n12m. 2. Reserve Bank of New Zealand -Household
Balance Sheet (C22)
$0k
$200k
$400k
$600k
$800k
$1,000k
$1,200k
$1,400k
$1,600k
199820002002200420062008201020122014201620182020
NZ Household Asset Values
2
Housing and land (including rental properties)
Deposits
Debt securities
Equity and investment fund shares
Other
New Zealand Property Investment vs International
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
19921996200020042008201220162020
Australia
Canada
Ireland
New Zealand
UK
USA
5.OneRoofYour essential property platform Strategy background
123
Property is cyclical
Historically, property has been in 7-10 yearcycles. The bottom of this cycle has
passedand we expect volumes and values to grow from here.
$0k
$500k
$1,000k
$1,500k
$2,000k
$2,500k
$3,000k
-
2.0k
4.0k
6.0k
8.0k
10.0k
12.0k
Median Sale Price NZMedian Sale Price NZ (Forecast)Monthly SalesMonthly Sale (6mth Avg)Monthly Sales (Forecast Trend)
Covid
5.OneRoofYour essential property platform Strategy background
Source: REINZ -Monthly Sales and Median Monthly Sales Price, Jan 1993 –Sep 2023
124
Your essential property platform
There are three pillars to the OneRoofstrategy
Superior listings
experience and
performance
Grow listingsrevenueAccelerate non-listings
portfolio
5.OneRoofYour essential property platform Superior listings experience and performance
125
Continuous product improvement is at the core of OneRoof
OneRoofcontinues to evolve and improve
•Home builders section
•Improved valuation tool
•Mortgage calculator
•Chatbot integration
•Presence on nzherald.co.nz
improved
•Valuation data enhancements
•Search profile builder
•VirtualOpen Homes + Live
Stream Auctions in response
to Covid
•New Rural vertical
•Retirement vertical
•Personalisation
•Enhanced agent/admin tools
•Enhancementsto ad units
•Agent reviews
•SEO improvements
•Audience segmentation
model
•Claim/track a home
•Residential for sale
•Estimate/Valuation section
•News/editorial section
•Historical sold records
•Rental, commercial &
businessverticals
•Find an agent
20182019202020212022
•Refactor ofback end and databases
•Complete rebuild of desktop andmobile websites
•Technical SEO improvements
1
•Organic sessions +86% YoY
•Listings pages + 172% YoY
•Search results pages + 44% YoY
•Estimate/valuation pages +70% YoY
2023
5.OneRoofYour essential property platform Superior listings experience and performance
Source: 1. Google Analytics UA –H1 2022 vs H1 2023 Organic traffic
126
OneRoof has strong coverage of for sale listings across the
country
OneRoof carries:
•~ 90% of TM property listings –note TM carries private sale
listings which is estimated a 5%-8% of for sale listings
•~100% of Reconz inventory
Bay of Plenty
86%
104%
Northland
91%
102%
Auckland
96%
103%
Waikato
91%
106%
Hawke's
Bay/Gisborne
88%
99%
Taranaki/Manawatu-
Whanganui, Central NI
79%
88%
Nelson/Marlborough,
West Coast
83%
94%
Wellington
78%
87%
Canterbury
85%
105%
Otago/Lakes/Southland
90%
96%
Key:
% of TM stock
% of Reconz stock
5.OneRoofYour essential property platform Superior listings experience and performance
Source: Oneroof.co.nz, trademe.co.nz/property (TM), realestate.co.nz (Reconz), September 2023
127
•OneRoof'snews audience has grown nearly 50% in the last three years.
•News now <30% of total sessions and remains important in delivering passive buyer audience
for conversion to active
•With increased direct traffic, NZ Herald referrals are a lower proportion (30% of sessions in
2020, 23% in 2021, 19% in 2022, 17% in 2023 YTD)
2
Source: Nielsen Online Ratings -Domestic Unique Audience, Sep 2023 (does not include exclusive mobile app audience)
Source: Tracksuit, Jun 23 –Aug 23
•OneRoof’s brand awareness highlights the
unique ability to leverage NZME assets
Source: 1. Nielsen Online Ratings -Domestic Unique Audience, Q2 2023 (does not include exclusive mobile app audience). 2. Google Analytics, 2020 –2023.
OneRoof has continued to close the web audience gap
Web audience for competitors has been decreasing during weaker property market
cycle. OneRoof has continued to grow, closing average gap to 139k in 2023
1
5.OneRoofYour essential property platform Superior listings experience and performance
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1,000,000
OneRoof v Competitors -NeilsenOnline Ratings NZ Web Audience
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
TMOneRoofReconzHomes
Brand Awareness
128
Increased audience engaging in listings and enquiries
•Focus on key audience metrics, has driven impressive growth, despite the challenging housing market
•Average Daily Listings Users (ADLUs) and Enquiries growth helps to drive revenue growth with a correlation between both metrics and
future revenue
Google Analytics, Jan –Sep 23
+36%
ADLUs
Jan –Sep YoY
+106%
Enquiries
Jan –Sep YoY
Google Analytics, Jan –Sep 23
Average Daily Listings Users (ADLUs) & Enquiries
Linear (ADLU)Linear (Enquiries)
5.OneRoofYour essential property platform Superior listings experience and performance
129
OneRoofis New Zealand’s
only multi-media real estate
platform, with market
leading offers and a unique
audience
•16% of the real estate market
is reached only by
OneRoof.co.nz, and 32% of
the OneRoofaudience is not
visiting any competitor
1
Source: 1. Nielsen CMI Fused Q3 22 –Q2 23 August 23 Fused : AP 15+, competitors are Trade Me, Re.co.nz, and Homes. 2. Google Analytics, Sep 23.
3. Nielsen CMI Q3 22 -Q2 23 August 23 Fused : AP 15+. 4. Triton Omny, Sep 23.
Passive Active Owners
•News
•Insights
•Property newsletter
•Inspiration
•Homes we love
•Brand spotlight
•NZ Herald carousels
•NZ Herald articles
•Thousands of property listings
•Property recommendations and
alerts
•Accurate Estimates
•Property data
•Find an agent
•House price report
•Open home planner
•Save a listing and alerts
•Market commentary from Tony
Alexander
•Estimate updates
•Suburb analysis
•Sold properties
•Property report
•The OneRoofRadio Show
623,000
Property Report
readers
3
322,000
Weekly print
readers
3
5,700+
Monthly
downloads
4
2,300,000+
OneRoofmonthly
digital users
2
38,000,000+
NZ Herald monthly
sessions
2
OneRoof has a unique value proposition
Digital PrintRadio
5.OneRoofYour essential property platform Superior listings experience and performance
The only platform to deliver through the entire consumer lifecycle from passive to
active property buyer
130
Continued platform development and leveraging OneRoof’s
passive audience will further increase listings views and
enquiries
Improve the website
•Improve user experience to make
finding a property and enquiring
easier
Optimise the app
•Refocus the app to improve the in-
market experience
•Differentiate the app with
personalisationand more features
Enhance listings point of difference
•Continue product development initiatives
Leverage the passive audience
•Leverage unique passive audience by driving news and valuations
audience to listings
Awareness
Interest
Consideration
Conversion
Activate the in-market audience
•High-impact brand activity targeting buyers to increase listings views
•Drive direct listings views and enquiries with paid digital marketing, Search
Engine optimisation,personalised communications, and leveraging assets
5.OneRoofYour essential property platform Superior listings experience and performance
131
Your essential property platform
There are three pillars to the OneRoofstrategy
Superior listings
experience and
performance
Grow listingsrevenueAccelerate non-listings
portfolio
5.OneRoofYour essential property platform Grow listings revenue
132
OneRoof Real Estate Revenue Mix and New Listings
•The property market
witnessed a decline in
new total listings coming
to market in 2022
•Against this trend, digital
listing and total OneRoof
revenue improved year
over year given unique
multi-media approach
Digital listings revenue continued to grow
5.OneRoofYour essential property platform Grow listings revenue
0k
20k
40k
60k
80k
100k
120k
140k
$0m
$5m
$10m
$15m
$20m
$25m
2019202020212022
Digital Listings RevenuePrint Listings RevenueAdvertising RevenueNew Listings Volume (OneRoof)
This growth continued against the backdrop of a lower number of new listings
coming to market
Source: NZME Analysis.
133
Residential new property listings have declined further in
2023
New properties coming to market have reduced over recent years.
Large reductions seen in Auckland which was OneRoof’s initial focus.
Annual New
Listings
20182019202020212022
Sep 22
YTD
Sep 23
YTD
Auckland
(000s)
39.6 36.6 42.7 42.436.6 28.4 23.3
Rest of NZ
(000s)
76.6 71.171.166.5 67.250.8 43.2
Total New Zealand
(000s)
116.2 107.7 113.8 109.0103.8 79.266.4
Auckland
YoY %
(5.8%)(7.7%)16.8%(0.7%)(13.7%)(5.0%)(18.0%)
Rest of NZ
YoY %
(1.7%)(7.1%)(0.1%)(6.4%)1.0%7.5%(15.1%)
Total New Zealand
YoY %
(3.2%)(7.3%)5.7%(4.3%)(4.7%)2.7%(16.1%)
5.OneRoofYour essential property platform Grow listings revenue
Auckland listings
as % of total
34% 34% 38%39%35%36% 35%
Source: REINZ -New Listings 2018 –Sep 2023.
134
The decline in new listings has slowed in second half of 2023,
creating further opportunity for growth
0k
20k
40k
60k
80k
100k
120k
140k
FY17FY18FY19FY20FY21FY22FY23
Monthly New Listings Total NZ (REINZ)
New Listings (Total NZ)NZME Forecast
5.OneRoofYour essential property platform Grow listings revenue
Source: REINZ -Monthly New Listings Jan 22 –Sep 23.
2,000
4,000
6,000
8,000
10,000
12,000
JanFebMarchAprilMayJuneJulyAugustSeptOctNovDec
Monthly New Listings Total NZ (REINZ)
FY22FY23
135
Recent commentary notes market improvements
5.OneRoofYour essential property platform Grow listings revenue
ANZ property Focus -October 2023
“The Government’s policy changes are likely to put upward pressure on house prices”.
Kiwibank–First View –16 October 2023
“The housing market stabilised much sooner than expected, partly because of the surge in migration. Over the year to
August 2023, we welcomed over 152,000 migrants (a record high) but waved goodbye to over 42,000 kiwis (the most since
2012). The net gain of 110,200 is the largest on record. So far, strong net migration is helping to boost within the economy.
The impact on housing and domestic spending has been relatively limited. But we still face a shortage of dwellings, at a time
of a fast-growing population. Price gains are likely to continue”.
136
0%
10%
20%
30%
40%
50%
60%
2020202120222023
OneRoof Digital Residential for Sale Listings Upgrade % (Peaks)
AucklandRest of NZ
•Auckland hit peak of
52% in September 2023
•Rest of NZ hit peak of
21% in September 2023
Residential listings monetisationis growing
Residential listingsconversion has seenstrong continuous growth, with further
opportunity to increase nationally
5.OneRoofYour essential property platform Grow listings revenue
Source: NZME Analysis.
137
Significant opportunity to grow listings revenue by
upselling to OneRoof’s higher packages
$- $200 $400 $600 $800
Highest Available PackageAvg Yield YTD Sep-23
$- $500 $1,000 $1,500
Highest Available PackageAvg Yield YTD Sep-23
Auckland
(Package pricing excl. GST)
Currently delivering yield
of 36% of highest
available package price
Currently delivering yield
of 37% of highest
available package price
5.OneRoofYour essential property platform Grow listings revenue
Rest of NZ
(Package pricing excl. GST)
Auckland has potential to increase
ARPU by 178% by upselling to the
highest premium upgrade package
Rest of NZ has potential to increase
ARPU by 173% by upselling to
highest premium upgrade packages
Source: NZME Analysis.
138
Significant opportunity to grow listings revenue
with Agents
OneRoof–the preferred partner of the Real Estate industry
Enhance listing packages
•Reconfigure and simplify packages across all real estate and agent
products, incentivisingconversion to higher value packages
•Enhance Boost productoptions and performance
Create and transform National Sales force
•Optimisedistribution of current NZME sales team, creating a
dedicated OneRoof national sales force based on regional market
sizes to ensure realisation of market potential, increase customer
service levels, and align sales strategy execution
Strengthen Agent relationships and tools
•Launch of further Agent insights tools
•Control Panel (internal tool) rebuild to improve sales team efficiency
•Improve agent communications strategy, targeting and offerings
•Further utiliseNZME assets to improve agent engagement
•Rebuild the Agent back endportal, OneRoofAdvantage
5.OneRoofYour essential property platform Grow listings revenue
139
Your essential property platform
There are three pillars to the OneRoof strategy
Superior listings
experience and
performance
Grow listingsrevenueAccelerate non-listings
portfolio
5.OneRoofYour essential property platform Accelerate non-listings portfolio
140
Continue to grow non-listings revenue
Partner for consumersolutions and services
•Finance partnership
•Expansion of home servicesintegrations/widgets
•Partner to provide opportunities for assisting with property lifecycle
Monetise unique audience and data
•Additionalhigh impact Ad units added
•Enhance agent lead generation tools
•Optimisationof existing advertising solutions, using NZME’s data capabilities,
to drive personalisation and better conversion for customers
John Smith
5.OneRoofYour essential property platform Accelerate non-listings portfolio
141
Your essential property platform
Scorecard
METRICH1 2023
Actual
2026
Target
Engagement
Audience 518k
Gap to #1 of 139k
-
Reduce Audience Gap to #1
Increase listing enquiries by
100%
Listings
Upgrade %
42.6% of Auckland
16.8% Rest of NZ
End of Year -60%
End of Year -40%
RevenueDigital 53% / Print 47%Digital 78% / Print 22%
EBITDA
Margin Target
(pre NZIFRS16)
(17%)15-25%
5.OneRoofYour essential property platform
142
6.CEO closing
Michael Boggs
CHIEF EXECUTIVE OFFICER
143
NZME can leverage its strength to deliver significant
shareholder value creation
•NZME strength
•NZME platforms reach 84% of the NZ population across a month
1
•40-50% market shares in audio and publishing businesses, with further growth identified
•High value relationships with audience and customers across multiple platforms
•Leading print business which delivers strong cashflows well into the future
•Digital transformation well progressed with meaningful digital revenue
2
•Digital revenues exceed $100 million per annum or 29% of total revenue
•Digital revenue growth of 19% CAGR (2019 –2023)
•High growth asset in OneRoof
•Consistently reducing the audience gap on the #1 player Trademe
•The strategy plans for strong delivery of revenue and profitability growth
•Key opportunity to realise higher value multiples for growth business
•Strong balance sheet -exceptionally strong when comparing to local competitors
•Significant reduction in debt
•Disciplined capitalmanagement
•Dividends are delivering high yield returns
6.CEO closing
Source:
1
Nielsen CMI Fused Q3 22 –Q2 23 August 2023 AP15+ (Total NZME = monthly NZME print, weekly NIMS, Weekly Radio GfK Fused S2 2023 and monthly online fused.
2
NZME analysis.
1144
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.