"First Investors Corp. Stock Ticker"
Navigating the Bosphorus: A Canadian Investors' Story CanWest Global INFORM, ENLIGHTEN AND ENTERTAIN CanWest Global Communications Corp. Metrics: CanWest Global is listed on both the 2005 Revenue – $CDN 3.0 billion Toronto and New York Stock Exchange 2005 EBITDA – $CDN 720.2 million Market Cap – $CDN 1.77 billion Ticker Symbols: Toronto: CGS.TO CGS-A.TO New York: CWG Canada Canada Australia New Zealand • Television / Radio • Newspapers/Publications • Television • Television / Radio • 05 Revenue – $CDN 698.6M • Interactive • Out-of-home •05 Revenue – $NZD 264.3M •05 EBITDA – $CDN 124.7M •05 Revenue – $CDN 1.2B •05 Revenue – $AUD 891M •05 EBITDA – $NZD 57.6M •05 EBITDA – $CDN 254.8M •05 EBITDA – $AUD 317M INFORM, ENLIGHTEN AND ENTERTAIN CanWest MediaWorks is Canada’s largest newspaper publisher National Post Ten Metro Papers Vancouver Sun The Province (Vancouver) The Gazette (Montreal) Times Colonist (Victoria) Calgary Herald The Edmonton Journal Ottawa Citizen The Leader Post (Regina) Star-Phoenix (Saskatoon) Windsor Star 1.4 million daily circulation 4 million + readers a day Metrics: 2005 Revenue – $CDN 1.2 billion 2005 EBITDA – $CDN 254.8 million Market Cap – $CDN 2.17 billion Ticker - CWM-UN.TO INFORM, ENLIGHTEN AND ENTERTAIN CanWest Global Communications Corp’s Canadian Television & Radio Global CH Vancouver Victoria Calgary Hamilton Edmonton Montreal Saskatoon Red Deer Regina Kelowna Winnipeg Toronto Quebec Atlantic Metrics: 2005 Revenue – $CDN 698.6 million 2005 EBITDA – $CDN 124.7 million Market Cap - 100% owned by CanWest Global Communications Corp. INFORM, ENLIGHTEN AND ENTERTAIN Ten Network Holdings – Australia Television & Out-of-Home TEN leads in its target demo of 16-39 year olds Mix of international programs, reality shows, domestic drama and sports Includes EYE Corp. , out-of-home advertising company with concessions in malls, public transit and airports in Australia and SE Asia, principally Indonesia and Malaysia Metrics: 2005 Revenue – $AUD 891 million 2005 EBITDA – $AUD 317 million Market Cap – $AUD 3.1 billion Ticker - TEN.AX INFORM, ENLIGHTEN AND ENTERTAIN CanWest MediaWorks NZ- New Zealand Television & Radio Television Only conventional private sector TV TV3 - leading private sector broadcaster C4 - recently re-branded music channel targeting young New Zealanders Radio Commercial radio market split between CanWest and one other private operator CanWest receives 45% of total advertising revenues 6 national brands covering spectrum of genres 21 live and local radio stations across New Zealand Metrics: 2005 Revenue – $NZD 264.3 million 2005 EBITDA – $NZD 57.6 million Market Cap – $NZD 403 million Ticker - MWL.NZ INFORM, ENLIGHTEN AND ENTERTAIN CanWest Global Communications Corp. Past Performance on International Investments CanWest International Investments: Net Cash Flow to CanWest, 1992–20061 C$ Millions 700 600 562.1 Internal Rate 500 of Return = 22%2 400 281.9 292.5 300 200 124.2 115.3 76.4 87.4 72.6 100 16.0 8.4 10.2 0 -5.4 -100 -45.3 -84.2 -200 Note: ¹Includes Network Ten, CanWest MediaWorks, New Zealand, TV3 Ireland, UTV, Chilean investment, and SBS; ²Network Ten and CMW NZ valuation based on current market value plus 30% premium, TV3 2006 cashflow includes C$188 million in sale proceeds, IRR discount rate range of 7%–10%. All figures in C$ millions. -300 -328.3 -400 FY92 FY93 FY94 FY95 FY96 FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 INFORM, ENLIGHTEN AND ENTERTAIN European Radio Market Forecast European Radio Advertising Historic and Expected Future Growth Figures in $US millions Actual PWC Estimates 2002-05 2006-10E Year 2002 2003 2004 2005 F2006 F2007 F2008 F2009 F2010 CAGR CAGR Europe Overall 5,194 5,543 6,070 6,337 6,712 7,096 7,517 7,921 8,354 Growth 6.7% 9.5% 4.4% 5.9% 5.7% 5.9% 5.4% 5.5% 6.9% 5.6% Western Europe 4,739 4,992 5,406 5,563 5,823 6,092 6,399 6,688 7,007 Growth 5.3% 8.3% 2.9% 4.7% 4.6% 5.0% 4.5% 4.8% 5.5% 4.7% Central and Eastern Europe 455 551 664 774 889 1,004 1,118 1,233 1,347 Growth 21.1% 20.5% 16.6% 14.9% 12.9% 11.4% 10.3% 9.2% 19.4% 10.9% • Over the next four years, total European radio advertising market is expected to grow by $USD 1.1 billion from $USD 6.3 billion in 2005 to $USD 7.7 billion in 2009 • Robust growth is expected in Central and Eastern Europe, while Western Europe is expected to experience modest growth from it’s already strong radio advertising market INFORM, ENLIGHTEN AND ENTERTAIN Turkish Advertising Environment Total Turkish Ad Spend: 2002 – 2010E Actual Morgan Stanley Estimates 2002 - 2004 Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 CAGR 33.0% Total Turkish Ad Spend (US$mn) 719 881 1,271 1,696 1,956 2,245 2,547 2,893 3,223 2005 - 2010E CAGR Growth 23% 44% 33% 15% 15% 13% 14% 11% 13.7% • Ad spending in Turkey grew by a compounded annual growth rate (CAGR) of 33% in the years 2002 – 2004 • Turkish ad spending is expected to continue to grow at a CAGR of 13.7% through to 2010 Source: Zenith Optimedia, Morgan Stanley Research INFORM, ENLIGHTEN AND ENTERTAIN Reasons for exposure to Turkish Ad Market Two key metrics support high growth expectations for Turkish ad spend: 1. Turkish ad market is one of the least saturated in the world Peer Analysis: GDP per Capita vs. Per Capita Ad Spend, 2004 Turkey’s Ad / GDP ratio was .4% in 2004, among the lowest in the world Note: Balloon denotes size of per capita ad spending Source: Morgan Stanley Research, Zenith Optimedia INFORM, ENLIGHTEN AND ENTERTAIN Reasons for exposure to Turkish Ad Market - continued 2. EU accession has historically been linked to rapid ad spending growth Advertising Penetration Performance Starting at First Year on EU Accession Source: Turkish forecasts based on Morgan Stanley Research estimates, other countries actual growth per Zenith Optimedia INFORM, ENLIGHTEN AND ENTERTAIN CanWest International Radio Investment Strategy & Initial Investments Investment Strategy: To make medium-term investments in the European radio by way of acquisition and license application in order to capitalize on the strong growth expected in the European radio advertising market over the next five years Initial Investments: 1. Turkey Population: 70 million Advertising market growth forecasted at 33% for 2005, 15% in 2006, 15% in 2007 and 13% in 20081 Successfully bid to acquire four radio Stations: Super FM, Metro FM – National stations Joy FM and Joy Turk FM – Istanbul stations Total Investment: $USD61 million 2. Solent and Bristol regions, UK Population: 1.5 million (Solent) and 500 thousand (Bristol) UK Advertising market growth forecasted at 8% for 2005, 6% in 2006, 5.5% in 2007 and 5.2% in 20082 Won licenses to start-up new radio stations in each region Original 106 FM in Solent launched October 1, 2006 1 – Source: Morgan Stanley Research 2 – Source: PWC Global Media Outlook 2005-2009 INFORM, ENLIGHTEN AND ENTERTAIN Turkish National Stations: Süper FM & Metro FM Süper FM • NATIONAL coverage with strong presence in Major Cities • Top-40, popular local music (75% Turkish / 25% Fantasy) & news coverage • Second highest listener share of Turkish radio stations (12.9%) • Süper FM has the highest share of the Turkish pop music market • Broadcast reach covers approximately 45% of the Turkish population • Growth potential is extremely attractive Metro FM • NATIONAL coverage with strong Major City presence . • Turkey's most popular national English-language Pop music station • Appeals to a young affluent urban audience, visiting tourists • High disposable income listeners which are of great interest to advertisers • It’s 4.9% market share is greater than the combined market shares of the next two most popular national stations broadcasting foreign language music • Reach extends to approximately 40% of Turkey's population Excerpt from Price Waterhouse Coopers Report - Global Media Outlook 2005 – 2009: •“In Central and Easter Europe, countries that entered the European Union are seeing the appearance of new advertisers, a development that contributed to the 20.5% increase in radio advertising in Poland” INFORM, ENLIGHTEN AND ENTERTAIN Turkish National Radio Audience 2005 Target Audience: All 2005-1Q 2005-2Q 2005-3Q Source: HTP Research INFORM, ENLIGHTEN AND ENTERTAIN Istanbul Stations: Joy FM & Joy Türk Joy FM • Istanbul coverage • Format includes English-language pop, rhythm and blues, soft rock, jazz and Latin music • Third highest listener share of Istanbul radio stations (1.5%) Joy Turk • Istanbul coverage • Format includes mix of traditional Turkish • Highest listener share of Istanbul radio stations (3.2%) Joy Turk and Joy FM have first and third (respectively) highest audience shares among Istanbul stations INFORM, ENLIGHTEN AND ENTERTAIN Foreign Direct Investment in Turkey • According to ANIMA & the Invest in France Agency (AFII), FDI in Turkey was $US2.8 billion in 2004 and increased to $US9 billion in 2005. •The Institute of International Finance (IIF) predicts FDI in Turkey will double to nearly $US20 billion by 2007, while The Economist Intelligence Unit ranked Turkey 7th among emerging markets in the world attracting foreign direct investment. Major Multinational Corporation Investments in Turkey - 2005 & 2006 18-Apr-05 Fortis buys 89.3% stake of Disbank for EUR 985 million. 25-Aug-05 GE buys 25.5% stake in Garanti Bank for $US 1.55 billion from Dogus Group 8-Feb-05 In partnership with the Koc Group, UniCredito of Italy buys 57% of the shares of Yapi Kredi bank for EUR 1.177 billion 4-Mar-05 Metro Group AG will invest EUR 300 million in opening four new supermarkets 16-Dec-05 UK telecom company Vodafone wins tender of Telsim for $US 4.55 billion 3-Jun-05 News Outdoor Group, a subsidiary of News Corp., acquires majority stake in Kamera Acikhava Reklamclik , a Turkish out-of-home advertising company 25-Jul-06 News Corp. acquires 56.5% of Turkish TV station TGRT for US$ 82 million 18-Oct-06 Citigroup agrees to pay $3.1 billion for a 20 percent stake in Akbank, a leading Turkish Bank, part of Sabanci Holdings INFORM, ENLIGHTEN AND ENTERTAIN