capital markets day november 14, 2018 red arrow … arrow stu… · capital markets day –...

RED ARROW STUDIOS

CAPITAL MARKETS DAY – NOVEMBER 14, 2018

JAMES BAKER

THREE LEVERS TO DELIVER OUR GROWTH PLAN

RED ARROW STUDIOS

OUR BUSINESS

CREATE A GERMAN CONTENT ECOSYSTEM

Build-&-Buy approach to strengthen our German footprint and increase our internal Entertainmentcontent feed

EXPAND OUR INTERNATIONAL FOOTPRINT

Committed to our businessand managed for success, continuing to evaluate strategic partnering options for scale

DRIVE AND SCALE OUR LEADING STUDIO71

Leverage intra-group synergies and expand high margin business

1 2 3

147

OUR VISIONA LEADING INDEPENDENT GLOBAL CONTENT STUDIO AND VIDEO PLATFORM WITH GROWTH PLANS

PRODUCTION

DISTRIBUTION

DIGITAL

LONG-FORMPRODUCTION

TV NETWORKS/GLOBAL PRODUCTIONSALES

CREATIVE TALENT

PACKAGINGTALENT AND IP

FINANCINGEARLY-STAGE

DEVELOPEMENT

IP INVESTMENT/DEFICIT FINANCING

CONTENTPACKAGING

SALES ANDDISTRIBUTION

SHORT FORMDIGITAL PRODUCTION

ADVERTISINGAND BRAND SALES

ONLINE TALENTMANAGEMENT

DATA TECHNOLOGYAND BRAND SAFETY

INCREASED COVERAGE OF VALUE CHAIN ACTIVITIES

DISTRIBUTIONPRODUCTION

DIGITAL

RED ARROW STUDIOS

148

SHARE OF COMMISSIONED CONTENT SPEND OF TV CHANNELS1)

EXPAND RED ARROW'S GERMAN PRODUCTION FOOTPRINT

1) Red Arrow Studios share of TV channels’ commissioned content spend in % (as of Q3 2018 LTM)

RED ARROW STUDIOS | 1. GERMAN CONTENT ECOSYSTEM

INCREASE CONTENT FEED FOR LOCAL COMMISSIONS BY RED ARROW STUDIOS

13%

2023+

2018

TARGET SHARE

CURRENT SHARE

ESTABLISH “STUDIO MODEL”

With talent and independent production companies in Germany to expand Red Arrow Studios’ economic scale

CONTINUE ACTIVE CONVERSATIONS WITH PRIORITY TALENT & TARGETSFOCUS GENRES: ENTERTAINMENT, FICTION, FACTUAL

Significant increase planned

BUILD-&-BUY APPROACH

Build-out RedSeven, establish new companies, and execute selected M&A across key and complementary genres

OVERALL DEALS WITH CREATOR TALENT

Writers, actors, directors

>30%

149

LOCAL EXPERTISE FOR THE GERMAN MARKET…

1) U.S. format version Basis: all German TV households, A 14-49, Mon-Sun, 3-3 hSource: TV Deutschland GmbH with AGF in cooperation with GfK/videoScope/ProSiebenSat.1 TV Deutschland


RED ARROW STUDIOS WITH TRACK RECORD OF LOCAL SUCCESS

P7S1 OTHER TV STATIONS

Season 2 (16 episodes) on ZDF Season 2 (8 episodes)

Up to

12.0%

Up to

9.1%Upcoming

Up to

13.4%

Up to

11.5%

Season 9 (7 episodes)Season 6 (9 episodes) Season 16 (12 episodes)1) on VOX Season 1 (3 episodes) on VOX

Season 2 (80 episodes) on RTL IISeason 5 (8 episodes)

150

BROAD CUSTOMER BASE

… ANCHORED BY A LEADING GERMAN PRODUCTION COMPANY

DIGITAL KNOWHOW

DIVERSIFIED FORMAT PORTFOLIO

Launch of a Brand & Digital Studio enabling new business opportunities (e.g., marketing services for McDonalds, Sony PlayStation, ING DiBa, Samsung and ABOUT YOU)

Excellent format mixture from strong format licenses (e.g., Germany’s Next Topmodel by Heidi Klum), Red Arrow Studios’ catalog (e.g., Married at First Sight) and self-developed ideas (e.g., Galileo Big Pictures)

~25%Revenue

CAGR from 2012-20183)

~300Employees at

2 HQs

70%Returningproduction

rate2)

~50%of revenues

generated with original content1)


1) 50% of Redseven revenues (as of Q3 2018 LTM) were generated with formats owned by Red Arrow Studios or Redseven2) % of revenues with returning productions (as of Q3 2018 LTM) 3) As of Q3 2018 LTMNote: Leading TV producer according to DWDL producer ranking

151

Copyright: ProSieben/Willi Weber

MOREOVER WE CONTINUE TO GROW INTERNATIONALLY

RED ARROW STUDIOS | 2. EXPAND INTERNATIONAL FOOTPRINT

BALANCED MIXTURE OF NEW AND RETURNING SHOWS DRIVES ONGOING SUCCESS

SCRIPTED REALITY ENTERTAINMENTFACTUAL

ENTERTAINMENT FACTUAL

Season 9 (10 episodes) (USA)

Season 13 (8 episodes) (UK)


Feature Documentary (USA)

Season 2 (8 episodes) (UK) Season 2 (20 episodes) (GER)

Season 2 (5 episodes) (UK)


Season 6 (9 episodes) (GER)

Season 1 (21 episodes) (Israel)

Feature Film (UK)




Season 1 (8 episodes) (DK)



Season 3 (3 episodes) (GER)



152

EXTENSIVE PROJECT PIPELINE

RED ARROW STUDIOS | 2. EXPAND INTERNATIONAL FOOTPRINT

WE HAVE VARIOUS NEW PICK-UPS AND DISTRIBUTION DEALS TO HIGHLIGHT

NEW PICK-UPS EXTENDED NEW PICK-UPS

Season 5 (10 episodes)

Season 2 (5 episodes) Season 2 (8 episodes)



Season 1 (5 episodes)Season 1 (30 episodes) Season 4 (8 episodes)Season 5 (10 episodes) (USA)

RED ARROW STUDIOS INTERNATIONAL WITH STRONG DISTRIBUTION PIPELINE DRIVEN BY LONG-TERM, MULTI-WINDOW, LIBRARY-ORIENTED IP INVESTMENTS

WORLDWIDE DISTRIBUTION RIGHTS1)

WORLDWIDE DISTRIBUTION RIGHTS2)

1) Excl. USA; 2) Excl. German-speaking Europe153

Continuously leveraging intra-group synergies and looking for scale opportunities

Top 1 & 2

Non-music YouTube Partner1)

1,334

No. of web channels2)

10BN

Monthly video views2)

>1,100M

No. of YouTube subscribers2)

186M

Monthly engagements2)

44BN

Monthly min watched2)

GLOBAL DIGITAL STUDIO

PLATFORM WITH IMPRESSIVE

TRACK RECORD

1) #1 in Germany and #2 in USA (according to Comscore as of August 2018); 2) September 2018, excl. France; YouTube analytics

RED ARROW STUDIOS | 3. DRIVE & SCALE STUDIO71

154

STUDIO71 WITH BROAD PRODUCTION CAPABILITIES


KEY CONTENT PRODUCED FOR INTERNATIONAL CUSTOMERS AND VARIOUS PLATFORMS

1) Digital program of German public broadcaster ARD and ZDF

AdVoD

SVoD/TVoD

TV/Other

Snapchat

FUNK Germany1) History UK Channel

YouTube Red YouTube Germany

Facebook

155

MULTI-PILLAR POSITIONINGCONTINUOUSLY EXPAND HIGH MARGIN BUSINESS

+50%YTD 2018 vs. YTD 20171)

YouTube ad sales

Licensing & merchan-

dising

Original content

Media sales

Branded solutions

Margin potential

… growth in U.S. content syndication revenues

5xU.S. media sales in 2018

compared to 2017

… merchandising revenue growth expected

… increase of U.S media sales on YouTube through brand-

safety infrastructure

… various examples for expansion of ancillary activity with key talent (e.g., Binding

of Isaac card game, event tour with VictoriaSarina)

+20% FY 2018 vs. FY 2017

1) YTD as of September


156

THREE THINGS TO REMEMBER

RED ARROW STUDIOS

OPTIMIZE THE POTENTIAL OF ORIGINAL PROGRAMMING

IN THE GERMAN MARKET

GROW OUR INTERNATIONAL FOOTPRINT WITH A FOCUS

TO BUILD AND RETAIN RIGHTS AND IP

DRIVE GROWTH OPPORTUNITIES FOR STUDIO71 WITHIN

THE GROUP AND ACROSS THE GLOBAL DIGITAL MARKET

GERMAN CONTENT ECOSYSTEM

INTERNATIONAL FOOTPRINT

SCALE GLOBAL STUDIO71

157

KEY ACTIONS EXECUTED BY 2019

RED ARROW STUDIOS

GERMAN CONTENT ECOSYSTEM

▪ NEW GENRE COMMITMENTS WITH FOCUS ON EXPANSION OF SCRIPTED CONTENT

▪ SECURE NEW TALENT PARTNERSHIPS AND OPEN NEW INTERNATIONAL FORMAT PIPELINE WITH RAS PARTNER COMPANIES

▪ CONTINUE BOLT-ON ACQUISITIONS IN STRATEGICALLY MOST IMPORTANT AREAS

INTERNATIONAL FOOTPRINT

▪ ROLL-OUT STUDIO PRODUCTION STRATEGY TO SECURE KEY IP AND LONG-TERM REVENUE STREAMS

SCALE GLOBAL STUDIO71

▪ CONTINUE TO SCALE AND GROW REVENUE MIX TO HIGHER MARGIN ACTIVITIES SUCH AS MEDIA SALES, BRANDED CONTENT, MERCHANDISING AND CONTENT CREATION TO ACHIEVE OVERALL MARGIN EXPANSION

E5

DISCLAIMER

This presentation contains "forward-looking statements" regardingProSiebenSat.1 Media SE ("ProSiebenSat.1") or ProSiebenSat.1 Group,including opinions, estimates and projections regardingProSiebenSat.1's or ProSiebenSat.1 Group's financial position, businessstrategy, plans and objectives of management and future operations.Such forward-looking statements involve known and unknown risks,uncertainties and other important factors that could cause the actualresults, performance or achievements of ProSiebenSat.1 orProSiebenSat.1 Group to be materially different from future results,performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements speak only as ofthe date of this presentation and are based on numerous assumptionswhich may or may not prove to be correct.

No representation or warranty, expressed or implied, is made byProSiebenSat.1 with respect to the fairness, completeness, correctness,reasonableness or accuracy of any information and opinions containedherein. The information in this presentation is subject to changewithout notice, it may be incomplete or condensed, and it may notcontain all material information concerning ProSiebenSat.1 orProSiebenSat.1 Group. ProSiebenSat.1 undertakes no obligation topublicly update or revise any forward-looking statements or otherinformation stated herein, whether as a result of new information,future events or otherwise.

capital markets day november 14, 2018 red arrow … arrow stu… · capital markets day –...

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