VRL Business Fundamentals

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2 VRL Business Fundamentals People will always want to go out Our simple, yet effective mantra We provide our customers with an escape from the worries of the world Our focus on delivering superior offerings is key to our success We have built a strong portfolio of complimentary businesses Highly regarded market leaders in the industry of entertainment Staying true to these fundamentals has enabled our growth and is what we do best 2

3 VRL Our History 2010 Simplification of capital structure to 1 class of shares Commenced operations. First Village Drive-In Croydon, Victoria Roadshow enters Television distribution. March 3, 1988 Back Door stock market listing to gain greater access to capital. Opening of 1 st US Theme Park Opening of Warner Bros. Movie World on the Gold Coast US based ipic Gold Class Partnership formed 2012 VREG Asia Commences business. China Theme Park Management Agreement finalised s 1960 s & 1970 s 1980 s 1990 s Early 1960 s Introduction of Hard- Top cinemas. In First twin screen cinema at Rivoli, Camberwell, Victoria Commencement of Roadshow film distribution. Agreement signed in 1971 for the distribution of Warner Bros. films Establishment of Roadshow Home Video Village Roadshow Pictures commences business in film production s Expansion of cinema circuit into Singapore. Purchase of Triple M Network & merge with listed Austereo Sale of Austereo and pay down of debt ASX 300 entry.

4 VRL Theme Parks PROFILE Australia s largest theme park owner and operator Gold Coast - Warner Bros. Movie World, Sea World, Wet n Wild Water World, Sea World Resort and Water Park, Sea World Helicopters, Australian Outback Spectacular, Paradise Country and Village Roadshow Studios Overseas - Wet n Wild Hawaii, Wet n Wild Phoenix Arizona, Wet n Wild Las Vegas Nevada GROWTH WET n WILD SYDNEY Cutting edge technology and world firsts New night time illuminations, on track to open December 2013 SEA WORLD Investment in a new Convention Centre to complement the increasingly successful resort CHINA AND ASIA Hainan Island Marine Park in construction under VRL management agreement Team on ground in negotiations for other opportunities in China and South East Asia 4

5 VRL Cinema Exhibition PROFILE VRL jointly owns and operates a combined 680 screens 72 sites with 514 screens across 51 sites in Australia 87 screens at 11 sites in Singapore 67 screens at 9 sites in the United States 12 screens in the UK GROWTH max Existing 35 screens, 8 new screens under construction Gold Class Existing 76 screens, 18 new screens under construction New site at Suntec City Singapore opening April

6 VRL Film Distribution PROFILE Australia s largest independent film distributor Distributor of films to cinemas nationally and to New Zealand as well as DVDs to major retailers Long standing exclusive distribution agreements with Warner Bros., ABC, BBC, Lionsgate, Nu Image, Film Nation, Relativity, The Weinstein Company and Village Roadshow Pictures GROWTH FILM RELEASES Australian - Now Add Honey Hamish Blake, Portia de Rossi, Felony Joel Edgerton, Tom Wilkinson, The Rover Guy Pearce, Robert Pattinson, Wolf Creek 2 John Jarratt Independent acquisitions include - Hunger Games Catching Fire Jennifer Laurence, Josh Hutchinson, The Wolf of Wall Street Leonardo Di Caprio, Matthew McConaughey, American Hustle Christian Bale, Jennifer Laurance, Bradley Cooper DIGITAL Australian digital market has grown 30% to around $125m Roadshow outperformed market, achieving 50% growth year on year Enormous potential through itunes, Google, Microsoft, Foxtel, Big Pond and JB Hi Fi with faster broadband and greater connectivity through smart phones and tablets 6

7 VRL Film Production PROFILE VRL owns 47% together with other leading investors in the entertainment industry Village Roadshow Entertainment Group consists of Village Roadshow Pictures and Village Roadshow Pictures Asia One of the leading independent Hollywood producers Produced and released 74 films with box office takings of over US$12 billion Minimal earnings to VRL as equity accounted Adds great value to our Film Distribution and Exhibition businesses GROWTH Strong release schedule increasing annual releases to 6 9 films per annum including: The LEGO Movie, Winter s Tale, Edge of Tomorrow, Jupiter Ascending, Into the Storm, The Judge, Mad Max: Fury Road and In the Heart of the Sea Village Roadshow Pictures Asia (VRP Asia) Outstanding success of VRP Asia s first two films during FY13 Journey to the West and Say Yes Journey to the West achieved the highest box office for a Chinese film in China Future VRP Asia releases include, Don t Go Breaking My Heart 2 currently in production and Go Lala Go 2 currently in pre-production 7

8 VRL Other Growth ipic 30% owned stand alone Gold Class cinema circuit in the US Currently minimal earnings but strong expansion program mostly funded by off balance sheet and non-recourse debt facility New ipic super site on Wilshire Boulevard, Westwood Los Angeles to open March 2014 In negotiation for additional prime location sites including New York, although considerable lead times EDGE LOYALTY Recent 100% acquisition Loyalty programs and promotion activities Brands include Giftango, Gifte, Hollywood Movie Money, Gift Card Planet and the soon to be launched Fairfax Good Food Gift Card MY FUN New website launched June 2013 Over 160 leisure experience partners covering more than 400 attractions around Australia 8

9 VRL Corporate HIGHLIGHTS Cost management continues to be a key area of attention, achieving significant reductions over the last few years We are investing in our core systems to: Enhance our internal governance and controls Further utilise our customer data through optimisation of our in-house analytical capabilities, and Ensuring our systems are scalable, supporting future growth We remain focussed on our existing businesses, but continue to look at development opportunities in emerging geographic and technical growth markets 9

10 VRL 2013 Results summary Group Financial Highlights EBITDA* EBITDA* - $164.0m up 6.0% Strong contributions from all Divisions Theme Parks $89.3m up 2.3% Exhibition $58.5m up14.4% Film Distribution $46.2M down $4.5m Corporate & Other improved by $4.5m to ($30.0m) $Millions Net Profit After Tax* - $57.2m up 8.2% Net Profit After Tax* Impressive growth Driven by strong product & attractive customer offerings 128% increase since 2009 $Millions *Excluding discontinued operations and material items 10

11 VRL 2013 Results summary Group Financial Highlights Earnings Per Share* cents up 5.2% Year on year increasing EPS Supported by strong earnings and cost control Cents Earnings per share* Dividends per Share - Up 18.2% to 26c Continued commitment to shareholder returns Final FY 2013 dividend of 13 cents fully franked (Interim dividend H1 13 cents fully franked) Cents Dividends per share** *Excluding discontinued operations and material items **Excluding special dividends and distributions 11

12 VRL GROUP Group Debt On Balance Sheet Facility Expiry Calendar Year Total Debt Drawn 30 June 2013 $m Total Debt Drawn 30 June 2012 $m THEME PARKS GOLD COAST 1 st half THEME PARKS US WATER PARKS 1 st half 2029/ 1 st half CINEMA EXHIBITION - AUSTRALIA 2 nd half FILM DISTRIBUTION 2 nd half CORPORATE & OTHER (1) 1 st half TOTAL ON BALANCE SHEET DEBT Cash on Hand (2) (146.9) (193.5) NET DEBT ON BALANCE SHEET Note (1) : This $100m facility is undrawn at 30 June, 2013 Note (2) : Major non-operating cash outflows for the year included capital funding of Wet n Wild Sydney ($46.1m) Debt and Interest Cover by Division For the year ended 30 June 2013 Net Debt / EBITDA (Times) EBITDA / Net Interest (Times) THEME PARKS GOLD COAST CINEMA EXHIBITION AUSTRALIA FILM DISTRIBUTION TOTAL VRL GROUP

13 VRL FY2014 Update Theme Parks VRL, the Queensland Government and Ardent Leisure, announced a joint marketing initiative on 9 October. Will add marketing expense to FY2014 costs, but expect subsequent additional revenues Characterises the Gold Coast as the Theme Park Capital of Australia Utilising theme parks as the catalyst to bring extra millions of people to the Gold Coast and help fuel the Queensland economy Ticket sales marginally softer than previous year, with park attendances expected to increase in the remainder of the year, aided by the anticipated impact of the joint marketing initiative Wet n Wild Sydney on track to open December 2013, pre-opening costs will flow through in 1 st half with revenue in 2 nd half One off costs associated with the opening of Wet n Wild Sydney and Queensland joint marketing initiative of circa $8M in FY2014 Exhibition / Film Distribution 1 st quarter Theatrical softer than prior year, however significant releases scheduled in the coming months including Hunger Games Catching Fire VREG As previously noted, film performance criteria not met with no new film release until February 2014, hence no cash interest to VRL for at least first 3 quarters of FY

14 VRL FY2014 Capital Management SHAREHOLDER DISTRIBUTION A distribution of 25 cents per share as equal reduction of share capital, subject to shareholder approval. Intent for further 25 cents per share distribution after July 2014 subject to VRL s circumstances at that time Funded from surplus cash and debt facilities, will impact revenue from interest income/ interest expense $39.9M payable December 2013 (pending shareholder approval) Increase in Exhibition / Roadshow debt facilities by $100M and extension of term to September 2017 Additional refinancing and interest costs, circa $2.5M in FY2014 Corporate debt facility of $100M will be materially undrawn (after Exhibition / Roadshow refinancing), allowing flexibility and capacity for growth REFINANCING Theme Parks and Corporate debt facilities expire January 2015 Currently renegotiating to take advantage of better interest margins and increase length of facility Refinancing costs of circa $1.5M will be incurred in FY2014, thereafter expected positive impact due to better margins. 14

15 VRL Summary What we do best is sell tickets for the business of entertainment. Whether it be movie theatres, theme parks or a DVD at home we offer superior experiences and sell an escape from the worries of the world Strong growth plans Theme Parks Wet n Wild Sydney, China and other opportunities Cinema Exhibition Australian - max and Gold Class Singapore - new keystone site USA - ipic Gold Class theatres Film Production Accelerate portfolio from 3 to 4 films per annum to 6 to 9 films Simplification of our business and structure including exiting radio and combining share classes Stable cash flows and growth in earnings Above all the right people to deliver our future goals. 15

16 VRL GROUP Disclaimer Non IFRS Financial Information The VRL group results are prepared under Australian Accounting Standards, and also comply with International Financial Reporting Standards ( IFRS ). This presentation includes certain non-ifrs measures including EBITDA and operating profit excluding material items of income and expense and discontinued operations. These measures are used internally by management to assess the performance of the business, make decisions on the allocation of resources and assess operational performance. Non-IFRS measures have not been subject to audit or review, however all items used to calculate these non-ifrs measures have been derived from information used in the preparation of the audited financial statements. Included in the ASX Appendix 4E for June 2013 (page 10) and the Full Year Statutory Accounts for the year ended 30 June 2013 (page 9), is a Reconciliation of Results which provides further detail on the Non-IFRS financial information contained in this presentation. 16

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