Publi groupe presentation swiss equity forum version 7 september 2011 presentation hpr_final

Swiss Equity Conference Zurich
Results FY 2010 and HY1 2011 confirm PubliGroupe’s successful transformation and migration to becoming a leading service provider in the field of classic and digital media
Hans-Peter Rohner
CEO & Chairman of the Board
Zurich, 13 September 2011

Agenda
Background group & short presentation segments
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2
Key financials full year2010 & half-year 2011
Strategy & outlook
3

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PubliGroupe Marketing. More. Effective.
3
PubliGroupe is a leading Swiss-based provider of marketing and media sales services, enabling advertisers to spend their marketing budgets more effectively and allowing media owners to help monetise their reach more successfully.
Ultimate goal is to make marketing processes more effective for their clients, be it in traditional or digital media.
The group is organised into three client-oriented business segments: “Media Sales”, “Search & Find” and “Digital & Marketing Services”.
Listed on the Swiss stock exchange (PUBN).
Digital & Marketing Services
Search & Find
Media Sales
Producer and seller of media products facilitating the search for persons, companies, products
and services focusing on local markets.
Portfolio of leading international marketing and technology service companies, helping brand owners to spend
marketing budgets more effectively.
Preferred partner for media owners and advertisers worldwide, using effective advertising solutions.

Performance-oriented full-service provider
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PubliGroupe is a performance-oriented full-service provider, employing state-of-the-art data processing tools and information technology.
Each segment has a clear strategy, defined growth targets and agreed performance objectives.
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*
*
*
Zanox Group subsidiaries; note: Digital Window is the holding company for Affiliate Window and buy.at

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A group generating 1.5 billion CHF in revenue, with a strong presence in Switzerland and Europe
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The group is present in 22 countries, with about 2300 employees
The group has more than 400’000 customers:
Private persons
SME
National advertisers
International brands
The group cooperates with:
Well-known media companies
Digital Media owners
Different types of websites
MSN

Media Sales: 125 sales outlets in 20 countries
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SwitzerlandHQ in Zurich
Who are we:
The leading international global media sales company with 125 sales outlets in 20 countries
… representing the most prestigious media companies
… offering innovative media and marketing solutions
… relying on an unrivalled sales force
Our mission:
To be the preferred partner for media owners and advertisers worldwide
… capitalising on long term relationships with media partners
… bringing innovative solutions and a high-level entrepreneurial spirit
… and global media competence to the table

An unrivalled sales force that ensures closeness with our advertisers
A comprehensive media portfolio based on long-term relationships
Multi-channel communication solutions
High-performance tools and high-quality service
Media channels
Consumers
Publicitas
Annonceurs
Privé
Local
Regional
National
International
Agencies
Media Sales: Effective advertising solutions
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Advertisers
Private
Local
Regional
National
International

Media Sales: Working with leading media providers worldwide
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Australia: Channel 7Fairfax Media News Ltd.The West Australian
Austria: News
Argentina: La Nacion
Belgium: De Standaard Le Soir
Brazil: Folha de Sao Paolo O Globo Veja
Canada: The Globe and Mail Toronto Star
Chile: El Mercurio
China: South China Morning Post
Columbia: El Tiempo
Ecuador: El Comercio
France: Elles Magazines Le Figaro Le Monde Les Echos
Germany: Jahreszeiten Verlag Journal International Frankfurter Allgemeine Zeitung Süddeutsche Zeitung Spiegel
India: Times of India
Indonesia: The Jakarta Post
Ireland: The Irish Times
Italy: Corriere della Sera
Japan: The Nihon Keizai Shimbun (The Nikkei) The Asahi Shimbun
Malaysia: The Star Malaysia
Mexico: El Universal
Netherlands: De TelegraafFD Mediagroep
New Zealand: National Business Review New Zealand Herald
Peru: El Comercio
Poland: Gazeta Wyborcza
Puerto Rico: El Nuevo Dia
Singapore: The Straits Times
Russia: Kommersant
Saudi Arabia: Saudi Research & Publishing Co.
Spain: El Pais
South Korea: The Korean Herald JoonAng Ilbo
Sweden: Svenska Dagbladet
Switzerland: Le Temps Neue Zürcher ZeitungTagesanzeiger and numerous regional & local newpapers
Thailand: The Bangkok Post
UAE: Al Khaleej Times
UK: Associated Newspapers Conde Nast Publications Financial Times The Daily Telegraph The Guardian
Uruguay: El Pais
US: American Express Publishing Los Angeles Times National Geographic Magazine Nielsen Business Media The New York Times The Washington Post
Venezuela: El Nacional
Pan-European: Eurosport
Global: Forbes Fortune Time Reuters

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Search & Find: Bringing advertisers and customers together
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CONCENTRATE individual brand value into
Advertisers
330’000 companies
Users/customers
Population of 8 million
I must find the right service provider here and now
I want to reach today‘s and tomorrow‘s client
local.ch offers a multitude of solutions, to fulfill advertisers’ expectations:
to be found
to be chosen
to become known
local.ch offers directories that are
relevant
up to date
and comprehensive

“As a craftsman, it is important to stand out in the phone book from the many competitors.”
“Organic, food, drinks - I appear in the entries section where customers are looking.”
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Search & Find: Local.ch as Swiss market leader; partner of 370’000 Swiss small & medium-sized businesses
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“Presence is crucial. In order to prove yourself as a florist, you first have to
be discovered.”

Search & Find: Comprehensive broad screen & mobile
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Significantly increased broad screen revenue by 24%
Online orders intake exceeds print
Achieved and successfully defended #2 position after Google maps(1)
Uncontested #1 in mobile search & find(available on iOS, Android, Blackberry, W7)
Online revenue FY 2010 (local.ch + home.ch)
CHF m
+24%
2010
2009
Unique audience HY1 2011, in millions
(1) Nielsen / Netratings

Local.ch:Successfully strengthened leading position on mobile
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More than 1 million downloads of local app on all mobile platforms (iOS,Android,Blackberry,W7,Nokia)
24% usage growth of local.ch app on iPhone since January 2011
Uncontested #1 in Mobile search & find
> 1 million downloads
24% usage growth
Cumulative downloads on all platforms
Monthly use iPhone, in millions
App downloads, in millions
Occasional use (>1 day per month)
Frequent use (5 days per month)
Active use (>10 days per month)
Source: Official platform Stores (iOS,Android,Blackberry,W7,Nokia)
Source: Usage rating by Apple

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Technology-oriented performance marketing models with high scalability
Key European markets penetrated - e.g. Zanox market leader in Germany and UK and #1 in Europe
Technology-oriented
1)
1)
Professional services-oriented business models benefit from scope
Examples: e-business concept, search engine marketing, lead management etc.
Namics
Professional services-oriented
Demand-side (advertiser-oriented)
Supply-side (publisher-oriented)
1) Zanox Group subsidiaries; note: Digital Window is the holding company for Affiliate Window and buy.at
Digital & Marketing Services: Technology and professional services-driven businesses

Digital & Marketing Services:Zanox grows top and bottom line
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Zanox with strong top and bottom line since creation of joint-venture: revenue growth of 29% CAGR; EBITDA growth of 20% CAGR.
Growth as a result of both positive organic development and acquisitions.
Zanox with leading market position in Performance Advertising Network segment.
Geographic expansion (organic and through acquisitions) playing an important role in the growth strategy.
Revenue € 368m
+57% vs. 2009
EBITDA € 21.8m
+12.8% vs. 2009
Zanox FY 2010 Sales & EBITDA, in millions of EUR
Zanox Group Geographic Positioning
Zanox HY1 2011 Sales & EBITDA, in millions of EUR
+18%
+22%
Geographic footprint further strengthened
New no. 1 player in Benelux after M4N acquisition
Offices in Turkey and Poland operational - CH in continued build-up phase
Expansion to Brazil in progress together with key client
#1
#2
#1
#1
#1
#1
#2
EBITDA
Sales

Agenda
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2
Strategy & outlook
3

FY 2010 group results: Well positioned for the future
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Sales and gross margin in CHF m
Positive trend confirmed
Turnaround accomplished:
Accelerated migration towards "digital company"
Media Sales profitable ahead of schedule
Financially stronger with significantly reduced debt and stronger investment capacity
Strong performance across all segments:
Media Sales: successful execution of new business model
Search & Find with new organisational set-up that will strengthen future profitability
Digital & Marketing Services (DMS): now the European leader in affiliate marketing with Zanox Group; Namics enhances leading position in e-business consulting in Switzerland
Dividend payment of CHF 6, pay-out ratio of 33%
Net sales
Gross margin
EBIT and net profit, in CHF m
EBIT
Net profit

HY1 2011 group results: Net result up 8% on a like-for-like basis
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Sales and gross margin,in millions of CHF
Net result lower as first half of 2010 was strongly influenced by non-recurring one-off elements;
Operating result (EBIT) improved 23%.
On a like-for-like basis, HY1 2011 net result up 8% to CHF 7.6 million (HY1 2010: CHF 7 million), operating result up 17% to CHF 7.9 million (HY1 2010: CHF 6.8 million), owing again to a significantly lower cost base of CHF 9.8 million.
Sales lower due to currency effects and smaller volumes in the traditional business areas, especially print and TV, online growth continues.
Despite current economic woes and difficulty of forecasting the macro economic development, PG expects improvement of last year’s operative result (EBIT) for the full year 2011.
Sales
Gross margin
EBIT and net profit, in millions of CHF
EBIT
Net profit

HY1 2011 business segment summary
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EBIT lower mostly because of complete TV amortisation of goodwill
EBITDA in line with previous year, even slightly higher reaching CHF 0.4 million
Publicitas branch network Switzerland with positive results for the first half year
International: business suffers under currency impact and some shifts in budgets from the 1st to the 2nd semester
Comparable expenses down 14%
Media Sales
EBIT, in millions of CHF
HY1 2010
HY1 2011
Search & Find
EBIT lower owing to significant investments
Traditionally profiting from a much stronger second half in terms of sales, full-year profits should be at least in the order of last year’s results
DMS
EBIT betterbecause of strong operational performance at Zanox and Namics, the two most important assets
EBITDA of Zanox +18% to reach EUR 13.2 million
Corporate & others
Continued divestment of non-strategic assets in China (Emphasis Video Entertainment, City Media, Huashang Media Group) lead to one-time profits at corporate level
Media Sales
Digital & Marketing Services
Search & Find
Corporate & others

FY 2010 P&L GroupBack in solid black numbers
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3

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FY 2010 Group balance sheet Solid balance sheet and solid net liquidity
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The group's balance sheet remains solid
Strong net liquidity combined with largely reduced debt level

Agenda
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Strategy & outlook
3

Status of strategic initiativesReorganisation and cost reduction largely accomplished
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Level of Accomplishment
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Achieved cost savings of CHF 124.5 m over 3 years
CHF -48.5 m in Media Sales and HQ Corporate in 2010 alone
Headcount reduction by 241 FTE at Media Sales and HQ Corporate (12 months)
Reorgani-sation and cost reduction
ongoing
CHF -22m
CHF -55m
CHF -48.5m
2009
2010
2011
2008

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Level of Accomplishment
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2010 & 2011 divestment of non-core assets such as
Real estate: Baden and Lausanne
Non-core holdings of publishing houses: BAZ, Edipresse
Participations in China
Debt reduced by CHF 72 m to CHF 93 m
Strong balance sheet with 47.7% equity ratio
Target: maintain investment capacity of CHF 50 m plus
Emphasis Video
Entertainment
Huashang Interactive
City Media
Real estate
Winterthur
100% Stadt-
anzeiger Olten
37% BAZ Medien /
19.9% Edipresse
Real estate Baden / Lausanne
Divestment of non-core assets
Real estateZurich
2008
2009
2010
2011
Status of strategic initiativesDivestment of non-core assets mostly completed

Status of strategic initiativesContinuing investment in growth markets
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Ongoing
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Performance Marketing:
Build the leading European online affiliate advertising group together with Axel Springer
Build a comprehensive offering in digital marketing on the Swiss market
Repositioning of web2com
Acquisition of Instanz in May 2010 complements the web2com, Namics and Zanox performance marketing offering
Local Search Marketing:
Build the number one local search platform in Switzerland together with Swisscom
New setup of partnership with Swisscom to boost online services and to gain synergies
Promising market entry of new national real estate online portal home.ch
Investments in growth markets
2007
2008
2009
2010

HY1 2011 online performanceStrong online growth – driven by Zanox and Namics
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Ongoing
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Online revenue consolidated in PubliGroupe numbers: +13% to CHF 73 million; +17% at constant exchange rates.
Online revenue incl. participations: +8% to CHF 340 million; +20% at constant exchange rates.
Total revenue from online (incl. participations) represents 38% of total business generated by PubliGroupe and associated companies.
PubliGroupe expands its position as a key player in the online market in Switzerland (through Namics and Instanz) and with Zanox (in partnership with Axel Springer) in Western Europe and increasingly worldwide.
HY1 2011 Online sales, in millions of CHF
(Zanox and local.ch)
340
314
227
Total revenue
HY1 2009 :
CHF 951 m
(online 24%)
Total revenue
HY1 2010 :
CHF 942 m
(online 33%)
Total revenue
HY1 2011 :
CHF 884 m
(online 38%)

Conclusion & outlookOperationally largely improved, solidly financed, well positioned
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Results FY 2010 and HY1 2011 confirm PubliGroupe’s successful transformation and migration to becoming a leading service provider in the field of classic and digital media.
Double-digit growth of the operational result on a like-for-like basis shows PubliGroupe’s ability to constantly being able to adapt to changing economic conditions.
How to further monetize existing 400’000 customer relationships in Switzerland as a key strategic challenge for the future.
Despite the current economic woes and the difficulty of forecasting the macro economic development and its impact on the advertising spending, PG foresees that it will improve last year’s operative result (EBIT) for the full year 2011. The level of improvement will depend on the further economic development.

Backup Slides Results HY1 2011

HY1 2011 P&L GroupExpense reduction compensates for gross margin decline
Backup

Backup
HY1 2011 Group balance sheet Solid balance sheet and still solid net liquidity

Backup
Media SalesVolume mainly down due to non-continued TV activities
Sales,in millions of CHF
Sales decrease by 12% to CHF 517.2 million versus CHF 588.1 million in the previous year.
Major reason for the lower business volume was the result of the termination of the TV commercialisation agreements which represented almost CHF 30 million.
Print activities in Switzerland drop of 6%, international volume down by 11%, onlybecause of currencyeffects (at constantexchangerates international business with +2%).
The CHF 5.1 million one-time complete impairment of goodwill in the TV business plus other related costs resulted in a negative segment EBIT of CHF -6.2 million.
EBITDA positive with CHF 0.4 million (first half of 2010: CHF 0.0 million)
Comparable expenses for the segment dropped 14% from CHF 93 million in 2010 to CHF 80.4 million year-to-date 2011, down from CHF 145.4 million in 2007.
-12%
Sales
Gross margin and EBIT, in millions of CHF
-14%
Gross margin
EBIT

Backup
Media SalesGood operational performance by Publicitas branch network
Media Sales Switzerland*,in millions of CHF
Activities in Switzerland confirm their profitable turnaround, especially thanks to a good performance of the traditional Publicitas branch network in the regional/local markets, despite overall decline of business in Switzerland of 6%.
The volume of the international business, representing less than 20% of total Media Sales business, drops 11%, mainly due to negative currency impacts of a lower USD and euro.
The termination of the TV commercialisation agreements with the ProSiebenSat1 and 3+ groups decreased sales by almost CHF 30 million and gross margin by CHF 4.4 million. Total EBIT decline due to termination of CHF 5.5 million.
PubliGroupe had previously decided not to enter guarantee-based television agreements in favour of a performance-oriented profitability approach across all media categories.
-6%
Sales
* Does not include Electronic Media
Analysis Media Sales TV business 2011/2010,
in millions of CHF
Gross margin
EBIT
Sales

Backup
Search & Find Investing in the future
Sales,in millions of CHF
Good volume development, despite lower sales in traditional print business that saw a decline of -11%, largely offset by good growth in online search services (+11%).
EBIT down mainly because of investments being undertaken in the online platform home.ch, higher marketing efforts during the first semester and continued one-off costs associated with structural adjustments and the development of new online services.
Margins will increaslingly profit from a reduction of direct costs, such as from the optimisation of paper purchasing and production of print products with fewer suppliers
Traditionally profiting from a much stronger second half in terms of sales, S&F full-year profits should be at least in the order of last year’s results.
+9%
Sales
Gross margin and EBIT, in millions of CHF
+2%
-23%
Gross margin
EBIT

The Zanox group continues its strong performance as Europe's #1 Performance Advertising Network. The acquisition of M4N (NL) and geographical expansion (e.g. Poland, Turkey) accelerate growth. EUR 208m sales in HY 1 (+ 22% vs. PY).
DMS sales declined by -10% (-2% without currency impact) as reduction of traditional media budgets of SVB’s clients continues. Very good revenue development at Namics (+11% vs. PY).
Gross profit +6% was supported by expansion at Namics and improved margins.
Reported EBIT grew +53% (+74% w/o FX) driven by Zanox & Namics performance as well as a one time temporary effects (CHF 2.1m).
DMS further expands its footprint in "online performance marketing”, a fast growing area with higher margins than traditional online segments.
Digital & Marketing Services Strong operational performance
Backup
DMS Sales, in millions of CHF
70.3
-10%
62.9
Note: Zanox Group not included; includes FX impact of -8%
DMS gross margin and EBIT,in millions of CHF
+6%
+58%
Gross Profit
EBIT

Comparable expenses by segment
Backup
CHF 9.8 millions or 6% overall expenses reduction on comparable basis

Consolidated income statement
Backup

Consolidated balance sheetAssets
Backup

Consolidated balance sheetLiabilities
Backup

Cash flow from operating activities
Backup

Cash flow fromfinancingactivities
Backup

Cash flow from investing activities
Backup

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