EXHIBIT 99.1
Martha Stewart Living Omnimedia A Return To Growth |
Certain statements. “will,” projected are discussed in our recent filings under the Securities Exchange Act of 1934. The company is under no obligation to update any forward-looking statements after the date of this presentation. |
Who We Are Celebrating the Art of Creative Living |
• A leading brand in the lifestyle arena |
· An integrated media content company |
· An innovative design company |
Where We Were |
MSLO Revenue |
$350 $300 $250 $200 $150 $100 $50 $0 |
2002 2003 2004 |
Advertising declined, yet customers remained. |
Where We Are: Laying the Groundwork for Growth |
$350 $300 $250 $200 $150 $100 $50 $0 |
MSLO Revenue |
2002 2003 2004 2005 2006 |
• Advertisers dollars returning to MS Living magazine |
· Advertisers dollars beginning to flow to marthastewart.com |
· Diversification initiatives bearing fruit |
- New magazines (Blueprint, Body + Soul, Everyday Food) |
- New licensing deals (Macy’s, KB Home, Kodak) |
- Evaluating tuck-in acquisitions |
Where We Are Headed: A Return to Growth |
• Adjusted EBITDA and free cash flow positive in 2006 |
• 5-year adjusted EBITDA CAGR of 40-50% |
• Very high adjusted EBITDA to free cash flow conversion |
- Low capital expenditures |
- No debt |
- In excess of $100 million in net operating losses available |
- Diversified mix of business |
Publishing Living |
Publishing: Where We Were |
Publishing Revenue |
$120 $100 $80 $60 $40 $20$0 |
• Dependence upon Martha Stewart Living |
• Lack of title diversification |
• Advertising declined; circulation relatively unchanged |
Advertising Circulation/ Other |
Publishing: Where We Are Now MSL Accelerating Ad Page Growth |
250 200 150 100 50 |
2002 2005 2006 |
FEB MAR |
APR MAYJUN JULAUG SEP OCT NOVDEC JAN |
Publishing: Where We Are NowTurning The Corner at Body + Soul and Everyday Food |
-$2,000 -$4,000 -$6,000 -$8,000 -$10,000 -$12,000 |
Body + Soul Everyday Food |
• Investment nearing completion for both titles• Strong circulation increases in 1H06 - - 17% for Everyday Food, 48% for Body + Body• Strong growth in advertising revenue - - 55% for Everyday Food, 46%, for Body + Soul |
Publishing: Where We Are Headed |
2002 Publishing Revenue Split Special 2010 Publishing Revenue Split• MS Living advertising continues to normalize• Diversification initiatives grow in prominence |
Internet Overview |
Internet: Where We Were |
E- commerce business losing money |
No online advertising• |
Internet: Where We Are NowReaching Profitability |
Successful transition to an ad-supported content site |
Monetizing rich content library |
Target adjusted EBITDA breakeven in 2006 |
Advertising revenue of $8-10mm in 2006 |
Kodak agreement signed |
Flowers business growing |
Internet: Where We Are HeadedDigital Products |
Standard photo products |
MSLO |
High- margin licensing agreement for digital photo prodects |
Internet: Where We Are Headed |
Expand and integrate multi-media assets |
Easy, easy to find, navigate and share content |
Improve and open search experience providing our curated view of the web |
Single plan to find and experience MSLO branded products, with fulfillment by partners |
Become a starting point for all lifestyle on web |
Internet: Where We Are Headed10 Million Users By 2010 |
Website Traffic |
Become the leading lifestyle portal by 2010 |
Long-term margins of 40% |
Broadcasting
Merchandising: Overview |
High-margin predictable business |
In-house design teams |
No inventory or capital costs |
Merchandising: Where We Were |
Kmart accounted for over 80% of segment revenue |
Lack of diversification |
Merchandising: Where We Are Now |
MSLO Retail Merchandising: Partner Contracts Timeline |
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 |
Licensed Retail Partnershipstoday |
Kmart Sears Canada Federated |
Licensed Manufacturing Partnerships |
KB Home Bernhardt (Furniture) Sherwin (Paint & Colors) Lowe’s (Paint) Quality Home Brands Flor (Carpet Tiles) EK Success (Crafts) Safavieh (Area Rugs) |
Merchandising: Where We Are Headed•2008 adjusted EBITDA should approximate 2006 |
· Diversity of licensing partners allows for a more balanced portfolio |
· New category growth to continue |