Steve Lacy, Chairman & CEO Joe Ceryanec, Chief Financial Officer ...€¦ · Past success: Meredith 2001-2011 National Media Group + national media brands + local media brands + marketing

1

Deutsche Bank

February 28, 2012

Steve Lacy, Chairman & CEO

Joe Ceryanec, Chief Financial Officer

Safe Harbor

This presentation and management’s public commentary contain certain forward-looking statements that are

subject to risks and uncertainties. These statements are based on management’s current knowledge and

estimates of factors affecting the Company’s operations. Statements in this presentation that are forward-

looking include, but are not limited to, the statements regarding advertising revenues and investment

spending, along with the Company’s revenue and earnings per share outlook.

Actual results may differ materially from those currently anticipated. Factors that could adversely affect future

results include, but are not limited to, downturns in national and/or local economies; a softening of theresults include, but are not limited to, downturns in national and/or local economies; a softening of the

domestic advertising market; world, national, or local events that could disrupt broadcast television; increased

consolidation among major advertisers or other events depressing the level of advertising spending; the

unexpected loss or insolvency of one or more major clients; the integration of acquired businesses; changes in

consumer reading, purchasing and/or television viewing patterns; increases in paper, postage, printing, or

syndicated programming costs; changes in television network affiliation agreements; technological

developments affecting products or the methods of distribution; changes in government regulations affecting

the Company’s industries; unexpected changes in interest rates; and the consequences of any acquisitions

and/or dispositions. The Company undertakes no obligation to update any forward-looking statement,

whether as a result of new information, future events, or otherwise.

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Meredith Today

National Media$900 Million

WORKING YOUWSM V -TV WSM V-DT NASHVILL E

Local Media$320 Million

Marketing services$180 Million

• 13 TV stations reaching 10% of U.S. households

• Top 25 markets of Atlanta, Phoenix, Portland

• Daily nationally syndicated show

• 100 million audience¹

• 40 million web visitors¹

• Growing licensing business

• Leading B2B marketer with global reach, capabilities

• Experts in digital, social, mobile, database

• Clients include Kraft, Nestlè, Chrysler, Lowe’s

+ local media brands + marketing solutions+ national media brands

3¹ Includes All recipes.com

� Consistently strong magazine readership – 115 million

� Most popular media brand – Better Homes and Gardens

� Leader in food, parenthood and home categoriesRecent acquisitions: Allrecipes.com, Family Fun, Every Day with Rachael Ray

� Enable marketers to reach 80%+ of American women

� Powerful brand platforms 3,000+ products at Walmart

Growing Consumer Audience & Capabilities

National Media Group


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� Leading stations in fast-growing markets:

Atlanta Las Vegas Phoenix Portland

� Strong mix of network affiliations

� Expanding original news and syndicated programming

� Leading full service digital agency

� Award-winning experts at multi-channel engagement

� Recent Iris Worldwide investment gives global reach

Local Media Group

Meredith Xcelerated Marketing

Monetizing Audience Scale Across Platforms

Online: Meredith Women’s

Network

Magazines: Home, Family,

Health & Well-being Meredith Xcelerated Marketing

Consumer Events Database Marketing

Video StudiosBrand Licensing

Local Media


5

Tablet/Mobile

� Hired industry-leading management team

� Doubled market share to 11% of total magazine advertising

� Added younger women brands – American Baby, Parents, Fitness

� Developed brand licensing business – BHG at Walmart

� Enhanced digital platforms – websites, tablets, mobile

Past success: Meredith 2001-2011



� Hired industry-leading management team

� Doubled news programming to 420 hours per week

� Significantly grew political advertising, retransmission fees

� Launched Meredith Video Studios

� Created leading full-service digital agency

� Added digital, social, mobile, database, healthcare and international marketing capabilities

� More than tripled revenues

6

Local Media Group


� Investing in these growing audiences

across media platforms

Aggressively expanding digital,

Key market trends Meredith response

Meredith Prepared to Capitalize on Key Trends

� Young adults and upscale Baby

Boomers are fastest growing

demographics

Younger audiences consume media

7

� Aggressively expanding digital,

video, tablet and mobile platforms

� Investing in leading capabilities in

both the U.S. and abroad


� Younger audiences consume media

on the move and more visually

� Global clients looking for multi-

platform marketing solutions

� Ratings leadership in local markets

� Leadership in branded multi-platform content

� Aggressively executing broad digital strategy

� Expanded brand licensing program

Strategic Vision for Meredith in 2015


Local


� Ratings leadership in local markets

� Digital and mobile platforms of scale

� Growing non-traditional revenues

� Leader in providing digital marketing solutions

� Roster of high-growth global clients

� New capabilities in fast-growing disciplines

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Local Media Group


� Grown leadership in branded multi-platform content

Expanded food & parenthood scale through acquisitions

� Aggressively executing broad digital strategy

Acquisition of Allrecipes.com doubles scale of Meredith Women’s Network

Rapid expansion to tablet and mobile for all major brands

Delivering 20% of consumer marketing transactions digitally

� Expanding brand licensing program

Extended and expanded brand licensing program at Walmart

Strong Progress in FY12 Toward 2015 Vision



� Delivered strong ratings in most recent November period

� Expanded mobile sites across station group

� Expanded distribution of the daily syndicated The Better Show

� Rebranded to reflect new capabilities

� Creation of the Meredith-Iris Global Network

� Developing Health and Search Engine Optimization capabilities

9

Local Media Group


Implemented Total Shareholder Return strategy

Meredith Key Initiatives

� National Media Group

— Implementing expanded food strategy

— Growing brand licensing

— Moving circulation transactions online

— Executing digital strategy

� Local Media Group

+ local media brands + marketing solutions+ national media brands + local media brands + marketing solutions+ national media brands

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� Local Media Group

— Growing advertising revenues

— Growing retransmission revenues

— Expanding digital and mobile platforms

� Meredith Xcelerated Marketing

— Maximizing existing client relationships

— Leveraging Iris Worldwide investment

— Launching new agency capabilities

Digital Growth Strategies

� Expand digital audience

� Accelerate tablet development


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� Scale mobile activities

� Create more video to populate platforms

� Increase advertising revenues

� Expand E-commerce activities

Allrecipes.com: Key Statistics

� General

− #1 recipe site in the U.S. and world

− 25m monthly unique visitors

− #1 food recipe channel on YouTube

− #1 downloaded Android, iPhone and iPad recipe applications

EXECUTING DIGITAL STRATEGY


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12+ local media brands + marketing solutions+ national media brands

iPad recipe applications

� Community

− 44m pieces of content created in 2010

− 4.6 million email subscribers

� Historical Growth Rates

− Revenue 20%+

− Operating Profit 30%+

Why Grow Meredith’s Food Category Online?

Where Consumers Go for Food/Cooking Information

Recipe books

Magazines

Online sources 50%

43

41



13


0 10 20 30 40 50 60

Other

Newspapers

None

Friends and family

Programs on TV 34

32

27

20

3

Source: Forrester

Vibrant and Loyal User Community� Vibrant and Loyal User Community

� Highly Attractive Demographic for Advertisers

� Deep relationships with leading consumer brands

What Sets Allrecipes.com Apart



� Significant Brand Recognition and Leading Global Footprint

� Unique Competitive Position

� Proprietary SEO Strategy

� Experienced Management Team

14+ local media brands + marketing solutions+ national media brands

Meredith + Allrecipes.com

1 Meredith Food Sites 27,960 1 Glam Media 86,616

2 Food Network 19,711 2 Meredith Women’s Network 39,586

3 About.com Food 12,396 3 iVillage.com: The Women’s Network 36,410

4 COOKS.COM 11,286 4 Shine 30,993

5 FOOD.COM 10,099 5 AOL Lifestyle 27,256

6 BlogHer Food 9,067 6 eHow Lifestyle 25,692

7 PlateFull 8,370 7 Conde Nast Digital 24,367

8 URBANSPOON.COM 7,070 8 Sheknows 24,072

Food Lifestyle



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8 URBANSPOON.COM 7,070 8 Sheknows 24,072

9 MyRecipes Network 6,777 9 About.com Lifestyle Network 21,399

10 Delish 6,487 10 Disney Lifestyle 20,717

11 FoodBuzz 6,413 11 Hearst Digital Media 19,356

12 Sheknows Food 5,741 12 Sugar, Inc - PopSugar Network 10,741

13 eHow Food and Drink 5,549 13 MSN Lifestyle 8,705

14 Taste of Home 5,064 14 Martha Stewart Sites 6,918

15 EPICURIOUS.COM 4,809 15 New York Media 6,033

16 Chow 4,714 16 CNN Living 5,319

17 KitchenDaily Food Group 4,673 17 XO Group Inc. 5,008

18 Gourmandia.com 4,214 18 AARP Sites 4,842

19 KRAFTRECIPES.COM 3,320 19 Real Simple Home and Lifestyle 4,835

20 iFOOD.TV 3,264 20 Lifetime Digital 3,783

Unique visitors; Source: ComScore Dec. 2011


� Strengthen our core businesses

— Expand in fast-growing advertising categories

� Scale our digital and video capabilities

Our Focus: Drive Growth and Return Cash


� Expand diversified sources of revenue

� Execute acquisitions and investments

� Return more cash to shareholders


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TSR (%)

15 13-14%

S&P 500 TSR Benchmarks – expected returns

Meredith’s Goal: Approach Top Quartile TSR

5

10

0

7-8%

S&P 500 Median TSR S&P 500 top quartile TSR

Multiple sources including BCG Investor Survey and Value Line


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3 Steps to Delivering Strong TSR

Earnings Growth• Revenue growth• Margin improvement

• Investments in business

1.


Free Cash Flow Yield

Change in Valuation

• Investments in business• Dividends• Share repurchases

2.

3.• Growth expectations• Performance consistency• Financial policies• Portfolio changes

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FY2015Estimated

Revenue Growth

$ 110-170

Putting Growth Strategies into Investor Context

� National Media Group— Implementing expanded food strategy




$ 150-250

20-40

20-40

2-4%1919


TOTALCAGRCompared to fiscal 2011 results; $ in millions

� Local Media Group— Growing advertising revenues



� Meredith Xcelerated Marketing— Maximizing existing client relationships



FY2015Estimated Operating

Profit Growth

$ 25-55

Putting Growth Strategies into Investor Context

� National Media Group— Implementing expanded food strategy




$ 40-85

10-20

5-10

2020


4-8%

TOTALCAGR

� Local Media Group— Growing advertising revenues



� Meredith Xcelerated Marketing— Maximizing existing client relationships



Compared to fiscal 2011 results; $ in millionsBefore Corporate Expenses

Earnings Growth• Revenue growth• Margin improvement

• Investments in business

1.

Step 2 to Delivering Strong TSR: FCF Yield



Change in Valuation

• Investments in business• Dividends• Share repurchases

2.

3.• Growth expectations• Performance consistency• Financial policies• Portfolio changes

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2.

Strong Free Cash Flow Generation: 2002-2011

$165 $168

$226

$157 $167

$185

5.6% CAGR

Strong Free Cash Flow Generation: 2002-2011

$113 $134 $138 $147

$165 $157

FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11

$ in millions 22


History of Returning Capital to Shareholders

$551 $604

New $100 million

authorization

$0.97

$1.53

50% increase

5% yield

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$30

$197

FY02 FY05 FY08 FY11 FY12

$0.35

$0.52

$0.80

FY02 FY05 FY08 FY11 FY12

Annual Dividends Stock Buybacks (cumulative)

$ in millions

Cash Flow and Strategic Uses

FY 2009 FY 2010 FY 2011 FY 2011

Operating cash flow $ 181 $ 192 $ 215 $ 215

Capital expenditures (24) (25) (30) (30)

Free cash flow $ 157 $ 167 $ 185 $ 185

Pro Forma


Free cash flow $ 157 $ 167 $ 185 $ 185

Dividends (40) (41) (44) (63)

Debt change (105) (80) (105) 180

Acquisitions (6) (8) (40) (250)

Cash available for: $ 6 $ 38 $ (4) $ 52

• Additional acquisitions• Share repurchases• Additional debt service

24$ in millions

Revenue growth 2 – 4%Net margin expansion 2 – 4%Net income Growth 4 – 8%

1.

2.

Earnings Growth

Free Cash Flow YieldDividend yield 4 – 5%Buyback yield 2%1

Meredith’s View of Total Shareholder Return

1.Based on timing of share repurchase plan and actual share price.Note: There is a strong commitment to maintaining this dividend payout level. The range in dividend yield results from the expected variance in share price.


2.

3.


Change in ValuationOther potential TSR contributors• Acquisition accretion TBD• PE Multiple Change TBD

Buyback yield 2%Net debt change (0)%FCF contribution 6 – 7%

Annual TSR (%) 10 – 15%

25

Fiscal 2012 Earnings Per Share Outlook

$0.65 to $0.70Third quarter


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$2.55 to $2.75Full year

Unchanged from January 24, 2012 earnings release

Excludes impact of Allrecipes.com acquisition

� Powerful media and marketing company with trusted national brands and an unrivaled female reach

� Portfolio of highly-rated television stations in fast-growing markets

� Leading full-service digital marketing agency

Strong Investment Thesis

� Experienced management team with a proven record of operational excellence and value creation through strategic acquisitions

� Strong stewards of capital committed to balancing growth and returning cash to shareholders

� Current dividend yield at approximately 5 percent


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Targeting 10-15 percent annual Total Shareholder Return

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Deutsche Bank

February 28, 2012

Documents

Steve Lacy, Chairman & CEO Joe Ceryanec, Chief Financial Officer ...€¦ · Past success: Meredith 2001-2011 National Media Group + national media brands + local media brands + marketing