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Disclaimer
This document, which has been issued by Axel Springer Aktiengesellschaft (the "Company"), comprises the written materials/slides for a presentation of the management.
Whilst all reasonable care has been taken to ensure that the information and facts stated herein are accurate and that the opinions and expectations contained herein are fair and reasonable no representation or warranty, express or implied, is given by or on behalf of the Company, any of its directors, or any other person as to the accuracy or completeness of the information or opinions contained in this document and no liability is accepted for any such information or opinions.
This document contains forward looking statements which involves risks and uncertainties. These forward looking statements speak only as of the date of this document and are based on numerous assumptions which may or may not prove to be correct. The actual performance and results of the business of the Company could differ materially from the performance and results discussed in this document.
The Company undertakes no obligation to publicly update or revise any forward looking statements or other information contained herein whether as a result of new information, future events or otherwise.
This document does not constitute or form any part of any offer or invitation to sell or issue, or any solicitation of any offerto purchase or subscribe for, any shares in the Company, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto.
Print75%
Digital25%
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Axel Springer has started transforming its business over the past 5 years to create a leading European integrated multimedia company
1) Pro forma
Strong brands
50%digital
50% print
Europe’s leading integrated
multimedia company
Our VisionOur Vision
Axel Springer in 2004
Axel Springer in Q1/10
Axel Springer’s digital activities represent 25%1)
of revenues and 11% of EBITDA in Q1/10
1)
Print98%
Digital2%
Our strategy focuses on our core competencies
4
International expansion
Replicating the “German model” internationally
JV with Ringier in CEE
2 Digital transformation
Existing brands extended online
Business model enhanced in digital world
3
Core Competencies
Leadership in Germany
Strengthen and expand leading market position
Strong brands drive high media reach and advertising revenues
1
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Germany represents a unique newspaper market1
National newspaper circulation revenues(07-09 CAGR)Key themes in German market
Strong circulation revenues in Germany
– Higher proportion of total revenues than in other countries
– More resilient than in the UK and the US
– Potential for regular cover price increases
Higher share of younger readers
No free sheets
Strong position of BILD with 81%1) market share
Newspapers with higher share of advertising spend than TV as opposed to US2)
BILD reach vs TV shows5)
The Sun
11.8
BILD
9.4
Le Figaro
8.911.6
7.8
28.7
USA Today
3.72.4
The X Factor
American Idol -Tuesday
Wetten, dass…?
Dr. House
(reach in m)
5) UK: Year average for The X Factor 2009, BARB (BroadcastersAudience Research Board); average reach of Sun between Oct.08 to Sept. 09 NRS (National Readership Survey), USA: USA TODAY Reader Brand Research 2009; MRI Fall 2009, Nielsen Television - TV Ratings for Primetime: Season-to-Date (2009-2010 Season Through Jan. 24, 2010), France: Daily newspapers: EPIQ-Studie2008/2009, TV: Viewers 4J.+ Mediametrie 2009; Germany: Average for “Wetten, dass…?” 2009, Viewers age 14+, GFK/TV Panel 2009, ma 2010 Pressemedien
1) Including Berlin newsstand newspaper B.Z.; market share based on paid circulation of newsstand newspapers2) Source: ZenithOptimedia December 20093) Source: company information; National Newspaper circulation sales as % of total National Newspaper sales4) Source: PwC Global Entertainment and Media Outlook, 2009-2013, 2009E forecast
4) 4)4)
0.3%
-3.6% -3.1%
2.9%
Axel Springer Germany UK US3)
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Axel Springer is Germany’s leading print marketer and publisher
Market share by adspend3)
Newspapers Magazines
16%
8%6%
5% 5% 4%
AxelSpringer
G+J Burda WAZ DuMont Bauer
Market share by circulation1)
Newspapers Magazines
19%
7% 7%5% 4%
3% 3%
AxelSpringer
Bauer WAZ SWMH Burda Holtz-brinck
G+J
With 19% market share, Axel Springer reaches
53% of the German population2)
1
1) Source: Company estimates based on IVW I 2010, paid circulation; weighted market share taking into account different title frequencies2) Source: ma 2010 Pressemedien I; combined reach among German 14+ year-olds of all covered Axel Springer AG newspapers, magazines and 100% owned subsidiaries3) Source: Nielsen Media Research; gross adspend, excl. classified ads, supplements and media advertising, 2010 Jan.-Mar, 100% owned subsidiaries and Jahr Top Special Verlag
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(Index of media reach) (Index of net advertising spending)
Print Market
BILD’s growing reach resulted in advertising sales outperforming the market (2002-2009)
BILD’s reach increased
Source: Print ma Pressemedien 2003-1 / 2010-1 (data for 2002/2009) for market reach of BILD family print titles including new titles founded after 2002
-family print 1)
1) Net figures, excluding BILDWOCHE2) ZenithOptimedia: Net Advertising Revenues newspapers & magazines 2002-2009
BILD’s advertising sales
-14.7% -4.1%
1
-0.3% +2.5%
Market 2)-family print 1)
Axel Springer: a strong platform for international expansion
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Germany79%
International21%
€2,064m
€548m
2009: €2,612m
Spain
12Magazines
1Digital portals
Market leader in video-games magazines, computer magazines5)
Newspapers
Poland2)
14Magazines4
30Digital portals
Newspapers’ market share: 37%1)
Market share 21%, Second largest consumer publisher4)
Hungary2)
38Newspapers 10
Magazines16Digital portals
Other magazines13
France6) 10Russia6) 8
Romania
Czech Republic2) 7
Print 71%
SwitzerlandMarket leader in TV listings,
business/financial3)
Newspapers14Magazines
1
9Digital portals
Digital 29%
2
Other digital
France, Italy, UK, Spain, Benelux, Swiss, USA, China, Sweden, Poland, Norway, Denmark
BelgiumDenmark GermanyFrance NetherlandsNorwayAustriaPolandSweden
France, Italy, UK, Spain, Belgium, Switzerland, Canada, Morocco
Germany, UK France, Italy, Spain, Austria, Netherlands1) Source: ZKDP; based on sold circulation 2009
2) Will be part of Axel Springer/Ringier joint venture3) Source: WEMF4) Based on circulation; Source: BRAT5) Source: OJD6) Partly in joint venture
Goal: Growth and digitization
Successful Eastern European
business since the 1990s
> 100 print titles, > 70 online
offerings
PF 2009 JV financials: revenues
€414m, EBITDA €62m
50% economic ownership with
100% consolidation for Axel
Springer
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CEE JV with Ringier: 5 market-leading mass market brands, strong digitization potential
Ringier PresenceAxel Springer Presence
Poland
Czech Republic
Slovakia
Hungary
Serbia
2
No. 1 tabloid: Blesk(Ringier)No. 1 tabloid: Blesk(Ringier)
No. 1 tabloid: NovýČas (Ringier)No. 1 tabloid: NovýČas (Ringier)
No. 1 tabloid: Blic(Ringier)No. 1 tabloid: Blic(Ringier)
No 1 tabloid: FAKT (Axel Springer)
No 1 tabloid: FAKT (Axel Springer)
No. 1 tabloid: Blikk (Ringier)No. 1 tabloid: Blikk (Ringier)
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We have become the largest digital player by revenue among European print publishers
20293640
117127
332
423
569
JohnstonPress
L'EspressoTelegraafTrinityMirror
DMGTLagardereSanomaSchibstedAxelSpringer
FY09
reve
nues
(€m
)Digital media revenues (in €m)
3
29% 13%
2% 5% 5% 3%
7%
4%
% o
f tot
al
reve
nues
25%2)
1) Based on pro forma revenues for Digital Media in 20092) Based on pro forma revenues for Digital Media in Q1/10m
12%29%21% 6%FY09
Q1/10 n/a n/a n/a n/a n/a
1)
Performance marketing
Classifieds / Marketplaces
Content portals
Digital strategy along core competencies
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Core Competencies
Audience Advertisers
A
B
C
Cross-synergies between core competencies increase revenues and profitability
12
BILD – example of our successful transition to digital channels
67.2
33.4 27.5
Kick
er O
nlin
e
Spor
t1.d
e
A
50m
100m
Jan-08 Jul-08 Jan-09 Jul-09 Jan-10
5.5
2.9
0.3
Auto
Mot
orun
d S
port
Auto
New
s
52.7
22.412.3
Chi
p.de
Pcw
elt.d
e
News
Sport Automotive Computer
3)
2) 2) 2)
1)
Site
vis
its (i
n m
)S
ite v
isits
(in
m)
Site
vis
its (i
n m
)
Site
vis
its (i
n m
)
1) Source: IVW, March 20102) Source: IVW, Jan – Mar 2010 (Average Q1/10)3) Axel Springer’s sport sites include: sportbild.de, Bild.de/Sport and Transfermarkt; Source: IVW (sportbild.de and Transfermarkt), Google Analytics (Bild.de/Sport)
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auFeminin – strengthening market leadership
6.8auFeminin5.4LeJournal de
Femmes
France: #1
3.0enFemenino1.1Terra Mujer
Spain: #13.5alFemminile
1.6Donna Moderna
Italy: #1
2.6goFeminin2.1Fem
Germany: #1iVillagesoFeminine
0.60.5
UK: #2
0.5auFeminin0.3Libelle
Belgium: #1
Unique Users in Mio.Source: Nielsen/comScore/AGOF/IVW, March 2010
International platform outside of France experiencing accelerated growth with tripled revenues since Axel Springer’s investment in auFeminin in 2007
17.518.219.2
11.36.53.3
2007 2008 2009
France International
Strong international presence International revenue contribution (in €m)
22.5
28.824.7+9.8%
+16.5%
A
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Paradigm shift in 2009: Monetization of digital content works
A
20092008 2010
Free BILD mobile portal Premium initiative with innovative pay-for-service programs and exclusive content
Quality content for the most demanding readers
No. 1 mobile portal1) – not only among BILDmobil customersInnovative paid content, services and functions with simple billing arrangementsApprox. 180,000 paid BILD and WELT iPhone apps to datePaid for mobile and online regional content introduced in 2009
No. of paid content packages: 8
No. of paid content packages: >20
1) Source: INFonline
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New distribution channel: iPadA
2010iPad US launch „iKiosk“
− WELT, WELT am SONNTAG and WELT KOMPAKT
− BILD regional editions
German iPad launch:
WELT app
„The Iconist“
Summer / autumn:
BILD app
All apps will offer optimized state-of-the-art ads that give the user additional value
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No. 1 jobsite in Germany1)
Online jobsites in 9 countries
Acquisition steps:
– 100% in several steps for approx. €130m
– Portfolio optimization: sale of software business for €110m
– Net purchase price of approx. €20m
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Utilizing marketing power to drive brand awareness for StepStone
Key facts Leading position in online job classifieds
B
Expansion potential
Cooperation with national newspapers
Further international potential (eg Ringier JV)
Strong growth expected in the job market1) Based on reach; Source: Comscore
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17
Online Performance Marketing –Axel Springer shapes European market leader
Revenues (in €m)
2008 2009e 2008 2009
+9% -21%
323284297
360
Acquired
08/2009
02/2010
C
600150
200
250
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We have a strong track record of acquiring digital assets and fostering their growth
RevenuesCAGR: (07-09A)
EBITDACAGR: (07-09A)
Investments (€m):(07A-09A)
32% 5% 17% 15%
15% 3% 23% 13%
Key assetsacquired
Content portals
Classifieds/marketplaces
Performance marketing Total
2007 PF EV/EBITDA
multiple: 12.0x
80
119
13.0%18.0%
0
100
Q1/09 Q1/10
EBIT
DA
(€m
)
0%5%
10%15%
20%25% E
BITD
A m
argin
334
486470434414
17.8%18.2%18.3%17.3%
12.8%
0
200
400
2005 2006 2007 2008 2009
EBIT
DA
(€m
)
0%5%10%
15%20%25%
EBITDA m
argin
EBITDA EBITDA margin
We have had a strong financial performance over the last few years
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Revenues
2,6122,7292,5782,3762,392
0
1,000
2,000
3,000
2005 2006 2007 2008 2009
Rev
enue
s (€
m)
Digital revenues Print revenues
664620
Q1/09 Q1/10
+7.0%
+48.4%
EBITDA
1)
1) Including restructuring items of €75m
Axel Springer starts 2010 with record quarter
Revenue increase of 7% to €664m1.
25% of revenues digital 1)2.
Improved advertising environment and market share expanded3.
5. Raised guidance 2010: EBITDA to increase significantly >10%
EBITDA at all-time high of €119m in a first quarter, margin at 18% 4.
1) Pro forma
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6. Dividend of €4.40 on record level of 2008
Q1/10: Revenues up 7%
1,215.8
264.72,611.6
1,248.1
296.9
1,138.5
1,176.2
2,728.5
20092008
Advertising revenues Other revenuesCirculation revenues
Total revenues (in €m)
+12.2%
-8.8%
-3.3%
-4.3%
-3.7%
+12.3%
+33.1%
22
+7.0%
Q1/10Q1/09
289.0
64.9
663.7
266.1
86.4
299.0
278.3
620.0
Print margins close to record high, Digital Media continues to grow and expand margins
2323
(in €m)
Revenues
EBITDA
EBITDAmargin
Circulation
Advertising
Other
Newspapers National
Q1/09292.4
64.8
22.2%
153.9
131.5
7.0
289.4
77.6
26.8%
149.6
132.7
7.1
yoy-1.0%
+19.7%
-2.8%
+0.9%
+1.6%
Q1/10
Magazines National
126.9
13.1
10.3%
89.1
33.2
4.7
119.2
25.2
21.1%
82.9
30.4
5.9
Q1/09 yoyQ1/10-6.1%
+92.8%
-6.9%
-8.4%
+27.5%
Print International
72.4
-2.4
-
46.0
24.3
2.2
71.6
5.4
7.5%
45.8
22.3
3.4
Q1/09 yoyQ1/10-1.2%
nm
-0.3%
-8.2%
+58.0%
Digital Media
104.7
6.8
6.5%
-
77.1
27.6
160.0
13.3
8.3%
-
113.5
46.5
Q1/09 yoyQ1/10+52.9%
+94.6%
-
+47.3%
+68.7%
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Strong cash flow generation and high dividend yield
209
250 260
292
239
199177 175
220243 246
233 231
0
100
200
300
400
Q1/07 Q3/07 Q1/08 Q3/08 Q1/09 Q3/09 Q1/10
Free cash flow (ltm1), in €m) Dividend yield2)
5.9%
5.1%
4.6%
3.5%
2.7%
1.2%
0.0%
0.0%
0.0%
0.0%
0.0%
Axel Springer
Sanoma
Lagardere
DMGT
Telegraaf Media
Schibsted
Gruppo L'Espresso
Johnston Press
Mondadori
RCS Media Group
Trinity Mirror
1) Last twelve months2) Based on actual 2009 dividend per share divided by share price as of December 31, 2009; Source: CapitalIQ
(0.2)%
0.9%
3.4%2.6%
1.0%
(4.9)%
1.8%1.6%0.7%
2.7%
(1.4)%
(8.7)%
1.0%
5.7%
(5.8)%
1.1%
5.5%7.8%
(15)%
(10)%
(5)%
0%
5%
10%
15%
2003 2004 2005 2006 2007 2008 2009 2010E 2011E
Real GDP growth y-o-y German advertising growth y-o-y
Outlook: Progressive recovery of the German advertising market
26
Source: Global Insight, March 2010; ZenithOptimedia, December 2009
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Outlook 2010
Group
Segments
Revenuecategories
Newspapers National
Magazines National
Print Inter-national1)
Digital Media
Services/ Holding
Revenues
EBITDA
Significant increase yoy
Significantly >10% increase yoy
Circulation
Advertising
Other
< 2009
> 2009
> 2009
< 2009
> 2009 > 2009 > 2009 > 2009 < 2009
< 2009< 2009 > 2009< 2009Revenues
EBITDA
1) Excluding consolidation effects from the joint venture with Ringier
Key investment highlights
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No. 1 publisher in Germany reaching 53% of the population
Leading market positions and brands across Europe
Strong profitability, healthy balance sheet, and high dividend
Attractive portfolio of leading online properties that scale internationally
Geared for cyclical advertising recovery
CEE JV creates the leading platform for growth in the region
Proven strategy to transition and monetize our leading media brands online
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Investor Relations contacts
Claudia Thomé
Head of Investor Relations
Phone: +49 (0)30 2591 77421
Mobile: +49 (0)160 90445035
Axel Springer AG
Axel-Springer-Str. 65
10888 Berlin / Germany
Fax: +49 (0)30 2591 77422
Daniel Fard-Yazdani
Deputy Head of Investor Relations
Phone: +49 (0)30 2591 77425
Mobile: +49 (0)151 52844459