M6 Group Lehman Brothers Meeting 4 July 2006 1
Overview Jan - June 2006 Audiences Jan - May advertising trends DTT New growth drivers Conclusion 2
M6 : Housewives<50 audience share still at a very high level after 2005 records WeekS 1 to 26 Hwives <50 years old audience share in % 35,7 35,3 34,4-0.9 2004 2005 2006 16,8 15,9 15,7 19,0 20,1 20,0-0.2 11,3-0.1 12,5 10,2 10,3 10,7-0.2 9,5-0.2 +0.1 3,7 3,4 3,2 2,6 3,0 2,8 +1.8 3
2006 : New records for M6 Prime Time attracting more than 5 million viewers (+4 y-o) Prime Time attracting more than 4 million viewers (+ 4 y-o) 64 18 32 5 2004 2006 2004 2006 Powerful Prime Time (more than 4 million viewers) are more and more frequent 51 64 32 2004 2005 2006 1 night out of 5 1 night out of 4 1 night out of 3 Source: Médiamétrie Weeks 1 to 25 4
Large audience successes on all targets 34,9 Average audience of the time slot (2004-05 ) Season 1 Season 2 Season 3 Season 4 21,6 25,4 28,8 30,3 DESPERATE HOUSEWIVES (first 6 weeks) 33,7 36,9 16,4 17,3 18,8 4.9 M 19,7 21,5 21,9 4.2M 13,8 5.0 M 3.9M 3.1M + 4 y-o H<50 y-o Nouvelle Star Season 4 tops new records + 1.8 million viewers vs. Season 1 + 1.0 million viewers vs. Season 2 + 4 y-o H < 50 y-o 4-34 y-o Desperate Housewives The event (first FTA broadcast) 5.0 million viewers (average audience) + 700 thd viewers vs. Season 3 5
FIFA World Cup 2006 Best audience of year 2006 : BRAZIL CROATIA : 6.3 M viewers (Slot average : January / May 2006) 1,0 Audience in million viewers Average audience in M During FIFA WORLD CUP in M viewers x2.4 4,8 x2.4 4,0 3,5 2,4 1,5 +55% DAY TIME ACCESS PT PT Audience share among 4 y.o and over individuals Average audience share in % During FIFA WORLD CUP in % x2.5 x3 31,6 32,9 +52% 22,4 12,5 11,1 14,7 Audience share among Men < 50 y.o Average audience share in % During FIFA WORLD CUP in % 48,7 44,7 33,4 X3.2 X3.4 19,6 15,2 13,0 +70% DAY TIME ACCESS PT PT DAY TIME ACCESS PT PT 6
Laura, the first summer fiction on M6 4.1 M viewers in average 4+ H<50 32,4 24,3 26,7 28,2 25,9 18,3 19,0 17,6 18,2 14,7 Average 04-05 Episode 1 Episode 2 Episode 3 Episode 4 7
US series : an audience driver for more powerful nights Season 2004-2005 average NUMB3RS (PRIME TIME) 20,4 24,3 Season 2004-2005 average MEDIUM (PRIME TIME) 21,2 27 13,7 14,8 14,5 15,7 3.3 M 3.1 M + 4 y-o H<50 +4 y-o H<50 Season 2004-2005 average Season 2004-2005 average NIP / TUCK (2d half of evening) 20,8 19,8 14,5 29,5 Season 2004-2005 average SMALLVILLE (PRIME TIME) 13,9 15 22,7 24,9 NCIS ENQUÊTES SPECIALES (PRIME TIME) 30,9 25,1 19,6 16,8 1.5 M 3.0 M 4.4 M + 4 y -o H<50 +4 y - o H<50 +4 y-o H<50 8
Enlargement of M6 s audience Evolution of channels audience profile jan-jun 2006 and point evolution (jan-jun 2006 vs jan-jun 2001) 46,9 +0.5 22,2-1.6 45,5 +0.2 +3.8 61,4 60,5 +1.6 40,4 +10.8 Source: Téléreport/Médiamétrie jan-jun 2006 vs jan-jun 2001 50,3 +4.9 36,7 +1.4 38,5 +2.4 +1.5 29,8-1.2 26,9-1.0 45,2-3.4 16,4-2.2 27,5-2.9 16,1-2.8 8,7-3.4-1.3 12,5 14,8-6.0 All TVs 4-24 y-o 25-49 y-o >50 y-o 9
Overview Jan - June 2006 Audiences Jan - May advertising trends DTT : First audiences New growth drivers Conclusion 10
M6 outperforms the TV market Gross figures : January May 2006 vs January - May 2005 The FTA advertising market is up by : +6.9% Jan - May 2006 vs Jan - May 2005 TV ad market share and changes Jan - May 2006 vs Jan - May 2005 Gross TV ad spends Jan - May 2006 Change Jan - May 06 vs Jan -May 05 1 260 M +6.9% 23,6% (+0.2 pt) 468 M 49 M +6.4% +1.3% 2,1% (-0.1 pt) 20,1% 54,2% (unch.) 549 M +7.7% (-0.1 pt) Source : TNS Media Intelligence Gross data 11
Sectors : M6 outperforms on Food & Health Beauty, underperforms on Household products Changes in expenditures and market shares (Jan May 2006 vs Jan May 2005) TTV 1-Food 554.8 M invested on all TV 2-Health & Beauty 309.7 M invested on all TV +0.8% 7-Household products 112.7 M invested on all TV -5.7% -1.7% -1.4% Change in expenditures Jan May 06 vs Jan - May 05-10.4% -28.0% Change in market shares Jan May 06 vs Jan - May 05 +0.9 pt +0.6 pt -5.3 pts Market share Jan May 2006 MS 21.6% MS 27.5% MS 21.7% Source : Micromarché TNS Media Intelligence gross data Jan to May 2006 vs Jan May 2005 12
Sectors : M6 outperforms on Telco, Services and Transport Changes in expenditures and market shares (Jan May 2006 vs Jan May 2005) TTV Change in expenditures Jan May 06 vs Jan - May 05 3-Telco 234.9 M invested on all TV +89.5% +113.0% 4-Transport 219.5 M invested on all TV +2.7% +5.1% 6-Services 187.4 M invested on all TV +32.5%+36.0% Change in market shares Jan May 06 vs Jan - May 05 +3.5 pts +0.4 pt +0.4 pt Market share Jan May 2006 MS 32.0% MS 15.5% MS 17.6% Source : Micromarché TNS Media Intelligence gross data Jan to Mayl 2006 vs Jan May 2005 13
Overview Jan - June 2006 Audiences Jan - May advertising trends DTT New growth drivers Conclusion 14
M6 audience share on Housewives <50 y.o increases in spite of fragmentation 40 35 36 35,4 35,3 34,1 35,9 35,4 34,4-1.6 pt 30 25 20 18,7 19,8 19,3 18,3 19,3 20,1 20 +1.3 pt 15 10 18,8 12,2 6,3 18,1 17,9 17,2 13 12,9 12,6 9,9 7,1 7,9 16,7 11 9,3 15,7 15,6 12,5 10,7 10,2 10,3 Other TVs - 3.1 pt +6.2 pt - 1.9 pt 5 0 5,1 4 3,5 3,9 3,8 3,5 3,2 2000 2001 2002 2003 2004 2005 2006 Mediametrie Weeks 1 to 26 Hwives <50 years old audience share in % - 1.9 pt 15
An effective strategy from 7 pm to midnight Breakdown of advertising expenditure by time slots (all TV 2005 data) Breakdown of M6 programme expenditure by time slots 7.3% 13.3 % 9.1 % 5.9 % 18.7% 45.5 % 10.0 % 50.4 % 12 midnight to 12 noon 12 noon to 2: pm 2pm to 5pm 5pm to 7pm 7 pm to 8:30 pm 8:30 pm to 12 midnight 6:30 pm to 8:30 pm 8:30 pm to 12 midnight 64.2% of advertising expenditure are concentrated on Access, Prime Time and the 2 nd half of the evening 60.4% of M6 programme expenditure are concentrated on Access, Prime Time and the 2 nd half of the evening 16
enabling M6 to offer the best opposition in this time slot M6 offers the best opposition to the DTT offer among all the major French TV terrestrial networks in prime time and audience share gains in the 2 nd half of the night - 3 % + 3 % - 7 % - 9 % Prime Time - 10 % - 16 % 2 nd nd half of the evening - 22% - 27% 31.7 M6 posts the 3 rd best prime time audience level for individuals 4+ y.o. equipped with DTT M6 posts the 2 nd best 2 nd half of night audience level for individuals 4+ y.o. equipped with DTT 31.3 16.8 13.3 12.7 6.6 2.8 1.9 1.8 1.0 16.0 14.1 9.6 5.9 4.2 2.5 2.0 1.2 Individuals 4+ y.o. audience share equipped with DTT / Monday to Sunday, January 2006 Source: Médiamétrie, subscribed channels uniquely surveyed 17
Audience shares on +4 y-o equipped with free DTT Relevant performance of W9 with an audience share of 3.1% on +4 y-o equipped with free DTT (vs 2.7% in January 2006) W9 is one of the few channels in progress. 6,1 4,3 4,1 January 2006 January - March 2006 Audience share - +4 ans y-o equipped with free DTT 2,7 3,2 3,1 3,1 Average score from mondays to sundays 03h / 27h In % -1.8 +0.4-0.1 1,2 +0.2 1,4 1,2 0,7 0,5 0,5 Period: 1st quarter 2006 Source : Médiamétrie 18
Cumulated audience on +4 y-o equipped with free DTT W9 is the most attractive and popular channel among the new DTT channels. 40,0% 37,4% 37,1% 38,1% 38,0% 37,3% January 2006 January March 2006 34,5% 32,4% 31,3% 28,2% 27,8% 27,4% 25,7% Period: 1st quarter 2006 Source : Médiamétrie / Equipped households threshold 1 second 19
Overview Jan - June 2006 Audiences Jan - May advertising trends DTT New growth drivers Conclusion 20
Diversification and audiovisual rights : an increased contribution to sales and EBIT FY 2004 FY 2005 % change Q1 2006 Revenues 352.2 380.3 + 8.0 % + 50.2 % EBITA EBITA margin 9.8 25.6 2.8 % 6.7 % 2005 highlights EBIT : 38.1 M (13.3 M gain on RTL Shop disposal) Except M6 Interactions, the contribution of all activities increased M6 Mobile and Mistergooddeal.com first contribution is positive > 300% + 24.5% on a constant scope 2006 Mistergooddeal.com, M6 Mobile by Orange and growth of other existing activities should generate sales replacing at least 2/3 of TPS sales contribution 21
HSS Mistergooddeal: a fast-growing Distance Selling player Turnover ( M) 32.6 58 Incl. MGD : M 23.3 Strong growth in the e-commerce market Average number of online buyers in 2005 Q3 Average number of online buyers in 2005 Q4 Average number of online buyers in 2006 Q1 + 77.9 % + 6.4 % on a constant scope Q1 2005 Q1 2006 12 million 13.4 million +26% vs.q4 2004 15.1 million +31% vs.q1 2005 Q1 2006 sales up 77.9 % (+6.4% on constant scope) HSS revenues +6.7% Pursuit of infomercials growth Mistergooddeal.com registers a sustained growth (+56% vs +37% for the market) e-commerce growth driver Creation of multi-channel player with a critical mass 22
M6 Web revenues more than doubled Turnover ( M) 13.6 Turnover up 102.9% 6.7 + 102.9 % Growth driven by: the success of the Group s websites and interactivity business Q1 2005 Q1 2006 M6 Mobile by Orange dynamism M6 Mobile by Orange 420 000 subscribers announced on the 7th of June 2006 1 million subscribers goal within 3 years Launch of a new offer coming soon M6 Web M6.fr 2 nd French media website Launch (Sept 2006) of innovative and entertaining sites A video sharing website A communitarian website An exclusive chatting system 23
Overview Jan - June 2006 Audiences Jan - May advertising trends DTT New growth drivers Conclusion 24
M6, combining innovation with a generalist status Channels perception by general public Innovation Relaxation, Show Knowledge, sobriety Source: Ipsos qualitative survey December 2005 Tradition 25
M6 Group strategic view Free to Air A generalist channel, with a new asset on free DTT Increased investments in sports, fictions, news Digital channels A complementary offer Ensure the best distribution and exposure Diversification and audiovisual rights Capitalising on a strong brand to develop complementary activities (targets, audiences, customers,..) Organic growth and acquisitions Secure content sourcing DELIVERING MASS AUDIENCES DELIVERING TARGETED AUDIENCES DELIVERING MULTIMEDIA AUDIENCES Control of powerful and federative contents available on both traditional and new supports Monetisation of audience share Increased advertising market share for incremental revenues and profits 26