Report rd Quarter Release - Johannesburg 13 November 2014

General Local Developments ABC initiative to explore aggregating printed and digital exposure into one currency.  On the 15 th October a Multiplatform /Total audience certification committee met and agreed the following:  The need to consolidate the data.  The need for continued transparency.  To report unduplicated results per title.  To include website and title applications (Apps).  To work towards reporting unique viewers, registered viewers and paid subscribers.  To include digital only publications.  Andre van Tonder was elected as Chairman.  And finally, that the work of the new committee would be a journey rather than a destination in itself.

South African Trends (Source Finweek) Despite declining print orders and increased rationalization of distribution, we’re seeing strong circulation revenue growth in the local newspaper category. PwC have revealed that newspaper circulation revenue has started to grow again and predicts healthy gains through to at least Compared to advertising revenue which is largely flat through to 2018, PwC predict a 2.3% gain from 2014 to The declining economy will, however, severely challenge publisher ability to increase cover prices further. The PwC report, titled Global Entertainment and Media Outlook 2014 is certainly worth reading.

Global Trends (Source Finweek / PwC) Newspaper revenue is starting to grow again...but still well down on 2009 levels. Revenue growth is coming from emerging markets, Latin America, Asia, MEA. Circulation Revenue for newspapers is becoming increasingly important. While digital focus has increased exponentially, by 2018 only 18% of newspaper revenue will come from digital advertising.

Rule Amendments effective 1 st October 2014: Registered Cover Price A title may register several cover prices, including regional, category, and PDF Replica prices. Where different category prices are displayed on the masthead, these will not require equal prominence. Category Price The registered price, for example, for Subscriptions, or Recommended Retail Price for single copy sales (also applicable to all other categories of circulation, excluding other category prices).

Membership Statistics:

Sector size ranked by circulation – Quarter :

Overall Economic Perspective Comment: Real GDP at market prices increased by 1% year on year. The main increase was in Agriculture, Forestry & Fishing. The largest decline was in Mining & Quarrying. Retails Sales increased by 1.4% in the 3 months ended July The main increase was in Retailers in Textiles, Clothing, Footwear & Leather.

4 Year Total Newspaper Circulation Trend by Quarter: Comment: Total newspaper circulation declined by 66,000 copies compared to the previous quarter.

4 Year Category Trend by Quarter: Daily Newspapers Comment: Circulation has declined annually by 3.8% since 2010, equivalent to 233,000 copies. However, Q3 declined 3.2%, compared to Q2.

4 Year Trend Analysis by Language Daily Newspapers Comment: English titles have declined by 3.9% annually (176, 000 copies) over the period. Afrikaans titles have declined by 5.2% annually (61,000 copies) over the period. Vernacular titles have increased by 1% (4,000 copies) over the period

4 Year Trend Analysis: Coastal vs Inland Daily Newspapers Comment: Inland circulation declined annually by 3.6% (138,000 copies) over the period. Coastal circulation declined annually by 4.3% (95,000 copies) over the period.

Titles Showing Largest Growth Daily Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1Herald, The ,45% ,42%

Titles Showing Largest Decline Daily Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Star, The ,89% ,71% 2Pretoria News ,04% ,58% 3Daily Sun ,86% ,28%

4 Year Category Trend by Quarter: Weekly Newspapers Comment: Weekly newspapers reflect an erratic performance. Q3, however, increased by 35,000 copies compared to Q2.

Titles Showing Largest Decline Weekly Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Motorsport World ,13% ,78% 2 Mail & Guardian ,93% ,93% 3 Ilanga ,70% ,31%

4 Year Category Trend by Quarter: Weekend Newspapers Comment: Circulation has declined annually by 5.7% (534,000 copies) over the period. Q3, however, declined by 3.9% (67,000 copies) compared to Q2.

4 Year Trend Analysis by Language: Weekend Newspapers Comment: English titles have declined annually by 6.3% (404,000 copies) over the period. Afrikaans titles have declined annually by 8.2% (185,000 copies) over the period. Vernacular titles have grown annually by 8.5% (55,000 copies) over the period

Titles Showing Largest Growth Weekend Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Saturday Dispatch ,59% ,80%

Titles Showing Largest Decline Weekend Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Pretoria News Saturday8,03410,515-23,59%9,748-17,58% 2Beeld, Saturday49,23459,69-17,52%53,408-7,82% 3Saturday Star, The62,51473,408-14,84%70,963-11,91% 4Ilanga Langesonto49,29856,656-12,99%52,361-5,85%

4 Year Category Trend by Quarter: Local Newspapers Comment: Local Newspapers have declined by 3.2% (65,000 copies) over the period. Q3, however, remained static compared to Q2.

Titles Showing Largest Growth Local Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Review Midweek ,03% ,05% 2Capricorn Voice ,08% ,54% 3Grocotts Mail ,53% ,37%

Titles Showing Largest Decline Local Newspapers No Publication NameTOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1The Courier ,24% 976 1,95% 2 Standerton Advertiser ,50% ,02% 3Vaalweekblad ,72% ,62%

4 Year Category Trend by Quarter: Hybrid Newspapers Comment: Circulation shows a dramatic decline as a result of The Times moving to Daily Newspapers in Q3,2013. Q3 circulation is significantly higher than Q2, because one title failed to report in Q2.

4 Year Category Trend by Quarter: Free Newspapers Comment: Distribution has increased annually by 5.7% (1,275,000 copies) over the period. Q3 remained static compared to Q2.

Titles Showing Largest Growth Free Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Northern Eyethu ,51% ,00% 2 Midvaal Ster ,99% ,48%

Titles Showing Largest Decline Free Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Veereniging Ster ,32% ,05% 2 Ilembe Eyethu ,40% ,98% 3 Rekord Central/Sentraal ,41% ,00% 4 Express ,27% ,00%

4 Year Magazine Circulation by Quarter Comment: Total magazines declined by 560,000 copies over the previous quarter. Consumer magazines decreased by 3% (176,000 copies) over the previous quarter

4 Year Category Trend by Quarter: Consumer Magazines Comment: Circulation declined annually by 2% (547,000 copies) over the period. Q3 declined by 3% (175, 000 copies) compared to Q2.

Titles Showing Largest Growth Consumer Magazines No Publication NameTOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Green Home (Six monthly) ,26% 2Wildland Magazine8,8774,91080,79%7,3920,12% 3Real Brides2,1931,53043,33%2,293-4,36% 4Visi (Six-monthly)15,77811,02643,10%

Titles Showing Largest Decline Consumer Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Tech-Smart Magazine 14,74739,626-62,78%16,432-10,25% 2 Today's Child 10,08320,262-50,24%10,0830,00% 3 All About Dogs Magazine (Six- monthly)1,6303,142-48,12% 4 HQ Pony 3,7916,716-43,55%3,5935,51%

4 Year Category Trend by Quarter: Consumer Magazines - Home Comment: Circulation has remained static over the period, Q3 increased by 31,000 copies compared to Q2, mainly the result of a new entrant.

4 Year Category Trend by Quarter: Consumer Magazines - Sport and Hobby Comment: Circulation declined annually by 4.4% (86,000 copies) over the period. Q3 declined by 26,000 copies compared to Q2.

4 Year Category Trend by Quarter: Consumer Magazines - Travel Comment: Circulation increased annually by 30.1% (316,000 copies) over the period, fluctuating considerably as a result of biennial reporting titles. Q3, however, declined by 29,000 copies compared to Q2.

4 Year Category Trend by Quarter: Consumer Magazines – Woman’s General Comment: Circulation declined by 3.8% annually (257,000 copies) over the period. Q3 declined by 71,000 copies compared to Q2, partly the result of a discontinued title (O, The Oprah Magazine).

4 Year Category Trend by Quarter: Business to Business Magazines Comment: Circulation has declined annually by 1.4% (72,000 copies) over the period. Q3, however, declined by 40,000 copies compared to Q2.

Titles Showing Largest Growth Business to Business Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Pedmed (Six monthly) ,48% 2 MIMS Guide to OTC Products (Annual) ,69% 3 Debate (Annual) ,68% 4 Public Sector Manager10,4967,71636,03%10,4290,64%

Titles Showing Largest Decline Business to Business Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1RISKsa2,5837,894-67,28%2,644-2,31% 2 South Africa's Top Performing Companies. (Annual) ,34% 3Fleet.4,5856,282-27,01%5,891-22,17%

4 Year Category Trend by Quarter: B2B Magazines – Hospitality, Catering and Tourism Comment: Circulation declined annually by 10.7% (41,000 copies) over the period. Q3 has remained static compared to Q2.

4 Year Category Trend by Quarter: Custom Magazines Comment: Circulation declined annually by 2.8% (1,513,000 copies) over the period. Q3 declined by 362,000 copies compared to Q2.

Titles Showing Largest Growth Custom Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 The SA Journal of Epidemoilogy & Infection (SAJEI) (Annual) ,31% 2Mercedes (Annual) ,95% 3 SA Franchise Warehouse. (Six- Monthly) ,91%

Titles Showing Largest Decline Custom Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Q-One Student Diary (Annual) ,55% 2 Strategic Marketing Magazine (Six monthly) ,30% 3 Furniture City Club (Annual) ,98% 4 DSTV Compact (formerly Dish Compact)998,041,304,235-23,48%1,180,963-15,49% 5M10,08513,168-23,41%11,346-11,11%

4 Year Category Trend by Quarter: Custom Magazines – Entertainment Comment: Circulation declined annually by 6.7% (929,000 copies) over the period. Q3 declined by 351,000 copies compared to Q2.

4 Year Category Trend by Quarter: Custom Magazines – Retail Comment: Circulation declined annually by 3.6% (1,069,000 copies) over the period. Q3 remained static compared to Q2.

4 Year Category Trend by Quarter: Free Magazines Comment: Circulation declined annually by 17.8% over the period. Q3, however, increased by 17,000 copies compared to Q2.

Observations: General: The economic outlook for South Africa, despite SABC’s call for confidence, seems challenging at best. Our GDP growth prospects for this year have more than halved since the initial budgets were set earlier this year and now sit at 1.2%. Declines in the value of our currency, issues in the mining, postal and manufacturing sector, growing levels of crime, increasing political intolerance, declining manufacturer confidence and a growing realization that Eskom cannot meet the most modest power expectations going forward, have all contributed to the challenging economic landscape ahead. As a well-known economist stated, “we have a slow puncture that started in 2008”. But every cloud has a silver lining. Trustworthy journalism and a consistent product in times of disruption often result in growth. While consolidation will save money and improve efficiency, this alone will not improve the financial standing of print. Those titles that are growing, are doing so by improving the product, increasing the value that readers obtain, and by better understanding reader needs.

Specifically we’ve noted: Daily & Weekend Newspapers : While circulations are down, careful examination of the detail and/or a review of the AMF Core circulation definition will reveal that there are several titles performing fairly well. This investigation will reveal that the most severe declines are clustered into one publishing group and most likely linked to an effort to cut non profitable distribution. That said, the growing use of distribution below 50% of the cover price has become concerning, and marketers should be aware of these tactics. In the Weekend category, two titles make up almost 70% of the total distribution below 50% of the cover price. Local Newspapers: While the statistics appear stable the reality is that it’s a mixed bag. Titles in this category looking for inspiration should look at the Capricorn Voice (+32%) or the Review Midweek that increased 40% year on year. Free Newspapers: The statistics say that this category is stable...and it is…except for a handful of titles that have reflect amazing growth. Consumer Magazines. The devil is in the detail. While the results reflect a disappointing result, more careful inspection will reveal that this decline is influenced by a review of a recent digital packaging of titles and their counting methodology.

 That said, it would be remiss if I did not single out a few titles that caught my eye. Specifically:  Destiny Man +20% (clean circulation growth)  Braintainment +17%  Modern Athlete +37.9%  Essentials +12%  Rooi Rose + 8.3%  SA Home Owner +7%  Habitat +5.6%  Business 2 Business and Custom Magazine performances are generally down and linked to sector heath.

Thank you.

Your ABC - Transparency you can see -