1. technology and computing
2. consumer electronics
3. telephones
4. mobile phones
5. smart phones

NIELSEN
INVESTOR OVERVIEW
MAY 2015
FORWARD LOOKING STATEMENTS
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
The following discussion contains forward-looking statements, including those about Nielsen’s
outlook and prospects, in the meaning of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are those which are not historical facts. These and other
statements that relate to future results and events are based on Nielsen’s current expectations
as of May 11, 2015.
Our actual results in future periods may differ materially from those currently expected because
of a number of risks and uncertainties. The risks and uncertainties that we believe are material
are outlined in our disclosure filings and materials, which you can find on
http://nielsen.com/investors. Please consult these documents for a more complete
understanding of these risks and uncertainties. We disclaim any intention or obligation to
update or revise any forward-looking statements, whether as a result of new information, future
events or otherwise, except as may be required by law.
Our outlook is provided for the purpose of providing information about current expectations for
2015. This information may not be appropriate for other purposes.
2
NIELSEN AT A GLANCE
2014 Revenue
2014 Free Cash Flow
$6.3B
$681M
2014 Adjusted
EBITDA Margin
Cash returned to shareholders
over 2013-2014
29.2%
$1.1B
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Measurement and analytics
for content, advertising and activity for
television, digital, social and audio
2014 Revenue Adjusted EBITDA Margin
44%
$2.8B
Measurement and analytics for
sales, market share
and consumer goods
Watch
Buy
44%
56%
2014 Revenue
Adjusted EBITDA Margin
$3.4B
19%
Dividend Yield
Market Cap
Private Equity Ownership
2.4%
$16.7B
4.4%
Revenues recurring
in nature
~70%
Our focus is to drive shareholder value through consistent growth,
profitability and free cash flow generation
Market Cap and Dividend Yield are reported as of 5/11/15
3
NIELSEN’S BUSINESS STRATEGY & OBJECTIVES
OUR
VALUES
Expand coverage of
consumer purchase
behavior globally
OUR
BRAND
BUY
QUALITY
OPEN
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Capture Total
Audience across all
screens and platforms
INTEGRITY
SIMPLE
WATCH
INTEGRATED
Help clients
understand how
individuals’ viewing
behavior impacts
MARKETING EFFECTIVENESS purchase behavior
NEUTRALITY
Execution of our strategy drives shareholder value through the cycles
4
THE NIELSEN VALUE PROPOSITION
PERFORMANCE MANAGEMENT
CONSUMER FOCUS
TOTAL
AUDIENCE
WATCH
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
BROADCAST
TV
SATELLITE
TV
CABLE
TIME
SHIFTING
DIGITAL
MOBILE
TOTAL
CONSUMER
BUY
GROCERY
MASS
RETAIL
DRUG
STORE
CLUB
OUTLETS
SPECIALTY
STORE
E-COMMERCE
GLOBAL PRESENCE
Well positioned to meet client needs of today and tomorrow
5
COMPELLING FINANCIAL PERFORMANCE
RESULTS
CONSISTENT REVENUE GROWTH
MARGIN EXPANSION
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
POWERFUL FREE CASH FLOW
BALANCED CAPITAL ALLOCATION
• 5% revenue CAGR(a) from ‘09 to ’14
• 35 quarters of consecutive growth
• Investing in key growth opportunities
• Powerful syndicated business model
• Disciplined pricing and cost-out initiatives
• ~3pts of margin expansion ‘09 to‘14
• 24% CAGR(b) from ‘09 to ’14
• Sustainable capital efficiency
• De-levered from 9.1x to ~3.6x between ’06 to ’14
• Tremendous flexibility to invest in growth
• ~$1.1B back to shareholders through 2013-2014
Strong track record of delivering consistent results
Note: a) Revenue CAGR derived on a constant currency basis, excludes Audio and Harris acquisitions
b) Free Cash Flow CAGR is as reported
6
WHY INVEST IN NIELSEN?
Measuring the Total Consumer and Total Audience
Unmatched global footprint of 106 countries
“Mission critical” measurement and analytics embedded in client workflows
Syndicated, scalable products and services
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Strategic investments to drive continued and future growth opportunities
Proven track record of growth and economic resilience
Strong free cash flow generation and compelling capital allocation strategy
Driving shareholder value is the cornerstone of our strategy
7
OUR GROWING GLOBAL FOOTPRINT
Our focus is relentless on our pursuit to provide clients with the most complete
understanding of what consumers buy and watch in 106 countries…
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
2014
2014REVENUE
REVENUEDISTRIBUTION
DISTRIBUTION
Nielsen presence
U.S. & Canada
58%
Western Europe
16%
Asia
<15%
LatAm, Africa,
<15%
Middle East, Eastern Europe
~20% of revenues in emerging markets, growing at double digit pace
…underscored by a global employee base of 42,000 talented associates we work hard to
attract, develop and retain
8
LONG-TERM, BEST-IN-CLASS CLIENT BASE
BUY
WATCH
PARTNERSHIPS
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
HIGHLIGHTS
• 20,000+ clients
• Relationships with top 10 clients
for over 30 years
• Long-term contracts provide
stable, recurring revenues –
average length of 3-10 years
• No client represents more than
3% of 2014 revenues
For 90 years, we have been at the forefront of measuring consumers around the world,
helping clients drive better business decisions and profitable growth over time
9
Q1 UPDATE ON KEY GROWTH CATALYSTS
•
Watch: Total Audience Measurement progress
Total Audience: framework for comprehensive measurement of the consumer
Traction with signature-based VOD solution
Gaining critical mass in mobile measurement with SDK adoption…video and audio
Digital Ad Ratings (fka OCR) momentum and market expansion
Copyright ©2015 The Nielsen Company. Confidential and proprietary.
Rollout of Digital Content Ratings (with Adobe) on track
•
•
Marketing Effectiveness: Strong growth in demand for marketing ROI products
Buy: Unmatched global presence
New client wins
Stronger discretionary spend on innovation and analytics
Broad-based Emerging market growth
Progress in eCommerce: new partnerships, New Offer Advisor launch
Executing and delivering
NLSN 1Q 2015 Results
10
STRATEGIC IMPERATIVE: MEASURE THE TOTAL AUDIENCE
TOTAL AUDIENCE
unduplicated
across all devices
and business models
Copyright ©2015 The Nielsen Company. Confidential and proprietary.
Ads
includes ratings regardless of
where + how ad is consumed,
including both linear and
dynamic ad models
Content
combined ratings for a program
or content regardless of where + how
content is consumed, including both
linear TV viewing and
dynamic TV/ video viewing
Framework that integrates our capabilities to offer comparable measurement
11
WHAT CONSUMERS BUY
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Broad, unparalleled reach of consumers worldwide
2B
electronic
records collected
weekly
3M
store level data
files annually
25M+
1.7M+
16M
characteristics
collected for 30M
products
store
visits monthly
consumer surveys
per year
12
BUY: PROVIDING MEASUREMENT AND ANALYTICS
Total 2014 Revenue: $3.5B…Approximately 60% recurring in nature
EMERGING MARKETS: $1.1B
DEVELOPED MARKETS: $2.4B
Retail sales measurement and market share information
• Presence in 106 countries
• Measure billions of monthly point-of-sale transactions
• Store level data from nearly 2 million stores, supplemented from proprietary household level data from 240K
households
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Advanced analytical capabilities and solutions
• Demand strategy
• Help clients “see around corners”
• Product Innovation
Our measurement and analytics
are embedded in the operating
disciplines of our clients, helping
to drive their growth
Marketing
C-Suite
Supply
Chain
Research
Sales
Investor and
Media
Relations
13
DIGITAL SHOPPING & E-COMMERCE
SALES
DELIVER SHARE MEASUREMENT FOR ECOMMERCE COMPARABLE TO BRICK &
MORTAR
DELIVER SHARE
MEASUREMENT
FORSpain,
EPresence in 5 markets (UK, France,
COMMERCE
COMPARABLE
China, and Korea); plans to expand across
NA, Europe
and &
SEMORTAR
Asia
TO BRICK
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
SHELF
SHOPPER
INSIGHT TO UNDERSTAND THE 21ST
CENTURY SHOPPER BEHAVIOR AND
SEGMENTATION
INSIGHT TO
UNDERSTAND THE 21ST
CENTURY
SHOPPER
Insights on
how shoppers
browse and buy
across devices
BEHAVIOR
AND
SEGMENTATION
Nielsen Omnichannel for an Alibaba key
account in China to compliment the channel
measurement
Shopper segmentations to guide
communication and engagement plans
Recent launch of New Offer Advisor (NOA),
innovative analytical tool in partnership
with Alibaba
Measure shoppers and content similar to
media
COMPETITIVE BENCHMARKS
AND ANALYTICS TO WIN
@THE DIGITAL SHELF
COMPETITIVE
BENCHMARKS
ANDInsights
ANALYTICS
TO
to understand
and improve the
WINdigital shelf conditions
@THE DIGITAL SHELF
Analytics to optimize assortment choice for
multi-channel retail
Powerful long-term opportunity for Nielsen
14
EMERGING MARKETS
GROWTH OF MIDDLE CLASS
EMERGING MARKETS REVENUE
8.3B
$1.1B
7.0B
10%
CAGR
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
3.7B
$0.4B
LOCALS
10-30%
Growth
$0.6B
$0.7B
GLOBAL
MNCs
Biggest increase ever
Source: OECD; CAGR represented in constant currency
Acceleration with locals
15
WHAT CONSUMERS WATCH
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Measuring Total Audience across screens
181M
164M
Using App/Web on
Watching
a Smartphone
Time-Shifted TV
* Number of users engaging with these forms of media
146M
Watching Video
on Internet
258M
142M
Listening to
Using Social Media
AM/FM Radio
on an App
on a Smarthphone
16
WATCH: MEASURING THE TOTAL AUDIENCE
Total 2014 Revenue: $2.8B…Approximately 85% recurring in nature
TELEVISION
DIGITAL
Global television audience measurement
Digital measurement, audience analytics
and consumer research
• A leader in US television advertising
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
• Television audience measurement in 35
countries
• Digital Ad Ratings
• Digital Content Ratings
• Proprietary data methods
• Mobile measurement
• Gold standard, MRC accredited panel
• VOD Measurement
• A leader in social media measurement
Our measurement and analytics
are embedded in the operating
disciplines of our clients, helping
to drive their growth
• Strategic relationships (Adobe, Experian,
Facebook, Twitter)
Media Programmers
Executives
Media
Sales
Agencies
and
Advertisers
Marketing
Investor and
Media
Relations
17
THE ONLY TOTAL AUDIENCE MEASUREMENT
dynamic
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
linear
TV
Programs
& Ads
Content
Ads
CONNECTED TV
PC
TABLET
SMARTPHONE
C3/C7/Program Ratings
Digital Content Ratings
Digital Ad Ratings
18
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
TOTAL AUDIENCE MEASUREMENT…TRACKING PROGRESS
Mobile
Measurement
Working with 49 broadcasters and cable
networks & 15 distributors
Gaining critical mass
Audio
Measurement
> 30 players across the industry working to
implement SDKs in apps and players
Video on Demand
VOD
Using audio signatures to measure audience
14 networks and studios are now signed up
Additional capabilities in 2016
Digital Ad Ratings
DAR
20 of the Top 25 advertisers endorse DAR
Strong renewals
Expansion into 7 new international markets
(including China)
Digital Content Ratings
DCR
Partnership with Adobe progressing well
Targeted Launch : September 30th 2015
19
DIFFERENTIATED CROSS PLATFORM ARCHITECTURE
TWO TYPES OF
CONTENT
COMPARABLE
OVERNIGHT
RATING
Native Digital Content
HARDWARE &
HARDWARE
SOFTWARE
METER
METER
Digital
Ratings
BIG DATA
ENABLED
MEASUREMENT
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
ONE CLIENT-SIDE
IMPLEMENTATION
Total
Audience
SDKs
ONE
ENCODING
PROCESS
GOLD
STANDARD
PROCESS
UNIVERSAL
MRC
ACCREDITED
Linear
Ratings
Traditional Linear Content
20
NIELSEN AUDIO
Expanded measurement of US consumers by 2+ hours
LONG TERM GROWTH
OPPORTUNITIES
• Digital Audio (Streaming) Audience
Measurement: 2+ hours of
consumer’s day
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
• Audio ROI…linking listening
behavior to consumer purchasing
habits
• Global expansion
• Working with more than 30 players
across the industry to implement
our SDK in their apss and players
Advertisers gain an average of
$6 for each $1 spent on radio(a)
Radio listening measured in 270+ markets
(a) Source: Nielsen Catalina Solutions
21
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
MARKETING EFFECTIVENESS: WHERE WATCH MEETS BUY
REACH
RESONANCE
REACTION
WHAT TOTAL
HOW DID IT
HOW DID IT
AUDIENCE DID I REACH?
CHANGE ATTITUDES?
CHANGE BEHAVIORS?
Helping clients understand how individuals’ viewing behavior is
impacting their purchasing behavior to increase ROI marketing efforts
22
NIELSEN MARKETING EFFECTIVENESS SOLUTION
Nielsen integrates with 1st party datasets to provide total view
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
OUR CAPABILITIES
IMPACT
PLANNING
Match 1ST party data to Nielsen
total audience measurement
SHIFT MEDIA PLANNING FROM
DEMOGRAPHICS TO DEMOS+
OPTIMIZATION
Integrate daily total audience
reach within overall marketing
data sets
ENABLE MARKETERS TO MAKE
ADJUSTMENTS TO PLANS INFLIGHT
ROI
Assemble longitudinal view of
all marketing elements and
actual sales
DRIVE HIGHER ROI / BUILD
STRONGER BRANDS
23
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
NIELSEN IS UNIQUELY POSITIONED
DATA OWNERS
TRUST NIELSEN
•
•
•
90+ years with retailers, media and manufacturers
Independent 3rd party
Sterling reputation with regard to consumer privacy
UNIQUE ABILITY TO
ENRICH DATA
•
•
•
Most experienced measurement scientists anywhere
Proprietary panels – the source of truth
Reference data and hierarchies across Watch & Buy
CONNECT AND
ACTIVATE
•
•
Combine with Nielsen’s industry standard datasets
Embed in systems across the ecosystem
24
MARKETING EFFECTIVENESS: GROWTH OPPORTUNITIES
MARKETING WILL CONTINUE TO GROW MORE COMPLEX
THE VOLUME AND GRANULARITY OF WATCH AND BUY DATA WILL CONTINUE TO
EXPAND
NO DATA SET ON ITS OWN WILL TELL THE COMPLETE STORY…OUR PANEL IS CRUCIAL
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
NIELSEN IS THE ONLY COMPANY POSITIONED TO ASSEMBLE THE TOTAL VIEW
WE ARE UNIQUELY TRUSTED TO PROTECT CONSUMER PRIVACY AND THE DATA
OWNER’S SECURITY
WE CAN EXTEND BEYOND CPG TO VIRTUALLY ANY CONSUMER CATEGORY
25
FINANCIALS
CONSISTENT PERFORMANCE THROUGH THE CYCLES
REVENUE ($B)
ADJUSTED EBITDA ($B)
9%
CAGR
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
5%
CAGR(a)
NET DEBT LEVERAGE RATIO(b)
ADJUSTED NET INCOME ($B)
42%
CAGR
$1.8
$970
FREE CASH FLOW ($M)(c)
24%
CAGR
$681
3.6x
Note: Revenue and Adjusted EBITDA growth rates derived on a constant currency basis. Adjusted Net Income and Free Cash Flow growth rates are as reported.
(a) Revenue CAGR excludes Audio and Harris acquisitions; figures are as reported
(b) Reflects Net Debt (gross debt minus cash), divided by Adjusted EBITDA calculated on last twelve months. 2013 is ProForma and includes nine months of Arbitron Adjusted EBITDA of $117 million. 2011 and 2012 exclude $288M
of mandatory convertible subordinated debt
(c) Excludes impact of 2011 Sponsor Termination Fees ($102M) and 2013 one-time Arbitron deal-related costs ($46M)
27
STEADY SEGMENT REVENUE GROWTH
BUY SEGMENT
WATCH SEGMENT
($ BILLIONS)
($ BILLIONS)
2009-2014 CAGR 5%
2009-2014 CAGR 5%
$2.8
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
$3.5
CONSTANT
CURRENCY
GROWTH
2.3%
7.4%
5.8%
3.6%
3.1%
3.6%
CONSTANT
CURRENCY
GROWTH
Note: Figures are as reported, CAGR and CC% represented in constant currency (excluding Audio and Harris acquisitions).
11.4%
4.6%
5.2%
4.8%
5.2%
5.8%
28
SELECTED FINANCIAL METRICS & BALANCE SHEET ITEMS
($ in millions)
CURRENT DEBT MATURITY PROFILE – 3/31/15 (b)
FINANCIAL METRICS
1Q 15
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Free Cash Flow
Capital Expenditures
D&A
Net Book Interest
Cash Taxes
Cash Restructuring
Wtd. avg. diluted shares
$(1)
$102
$142
$72
$29
$22
375.4
BALANCE SHEET – 3/31/15
Gross Debt
$7,347
Cash
$343
Net Debt
$7,004
Net Debt Ratio (a)
3.80x
$73
(a) Reflects net debt (gross debt minus cash), divided by Adjusted EBITDA calculated on last twelve months basis.
(b) Excludes Revolver ($75m), Capital Leases ($116m) and Miscellaneous Debt ($9m)
29
STRONG FREE CASH FLOW
($ in millions)
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
CAGR 24%
$209
Strong free cash flow supports growth investments and increased shareholder returns
Note: defined as cash flow from operations, normalized for non-recurring Arbitron transaction costs, less CapEx..Excludes $102M sponsor termination fee paid in 2011 and $46M in certain Audio deal-related costs paid in 2013.
30
DRIVING SHAREHOLDER VALUE THROUGH CAPITAL ALLOCATION
BALANCED CAPITAL ALLOCATION
Free Cash Flow + Balance Sheet
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Dividend
~45%
Buyback /
Tuck-in BD
~40%
Mandatory
Debt
~15%
STRONG
BALANCE
SHEET
RECENT ACTIVITY
Successful integration of Arbitron and Harris
acquisitions
Updated long-term leverage target to 3.0x area
Refinanced ~$5B of debt stack at attractive rates
Raised quarterly dividend by 12% to $0.28; up
75% since inception
~$1.5B buyback authorization
- ~$0.5B completed by year-end 2014
- ~$1B to be executed by mid-2016
Committed to grow and return capital to investors
31
2014
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
2013
2012
2011
NIELSEN ACQUISITIONS & JOINT VENTURES
2015
Company
Capabilities
Marketing Analytics
SaaS tool replacing PowerPoint analysis with real time, predictive analytics for marketing mix models
Neurofocus
Neurological testing for consumer research
Retail Plus (JV)
Measuring / monitoring sales and marketing of products in fast moving consumer goods sector
MEMRB
Expansion of retail services within Middle East/Eastern Europe; synergies across several countries
Carrier IQ
On-device meters for service quality measurement
Social Guide
Twitter TV ratings
Vizu
Marketing effectiveness
Ibope (JV)
Television audience measurement for Mexico, Dominican Republic and Venezuela
Ipsa
Retail Measurement Services (RMS) /Consumer Panel Services (CPS) in Ecuador
Perishables Group
Product expansion for retail services
Arbitron
Radio audience measurement
Bowker
E-books
MediaXIM
Belgium and Netherlands advertising info services
G4
Trade promotion optimization; Leader in SaaS analytics solutions for CPG companies
Nielsen Innovate
Israel based incubator investing in startups that help Nielsen clients (10 countries)
Harris
U.S. custom surveys
Nexium
Retail shelf image identification technologies that replace manual inventory management systems
MMRD (JV)
RMS in Myanmar
Czech TAM (JV)
Television audience measurement
Affinova
Intuitive user interface platform and automated analytics capabilities; Nielsen’s Innovation Practice
eXelate
Digital audience intelligence in the Programmatic Media ecosystem
Approximately $2B in acquisitions and JVs since 2011, driving growth, value & returns
32
FOREIGN CURRENCY IMPACT
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
2014 CURRENCY PROFILE - REVENUE
No single currency is >3%, excluding
USD, CAD, EUR, CNY & GBP
Note: we report on a constant currency basis to reflect operating performance
PROJECTED FX IMPACT(a):
REPORTED VS CONSTANT CURRENCY
(a) Projected impact assumes rates in effect at 4/21/15 remain in effect for the balance of 2015. Also based on company
estimates for future quarters on distribution of revenue and EBITDA by currency.
33
2015 GUIDANCE – APRIL 22, 2015
(Revenue and adj. EBITDA margin growth in constant currency)
Total Revenue
Adj. EBITDA margin growth
Adj. Net Income Per Share(a)
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Leverage
4.0% - 6.0%
50 - 70bps
$2.60 - $2.66
~ 3.6x
Free Cash Flow
$850-$900M
OTHER FINANCIAL METRICS
Net book interest
$310M - $320M
Cash taxes
$160M - $170M
Cash restructuring
$50M - $75M
Est. wtd. avg. diluted shares
outstanding for FY 2015
~ 371M
ANI per share lower due to FX; Operating guidance reaffirmed
(a) Prior ANI per share guidance range: $2.68 - $2.74
34
2015 REVENUE RANGE
(Percentages reflected as constant currency)
2014
2015 RANGE
RANGE DRIVERS
$6.3B
Watch
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Buy
$2.8B
$3.5B
Audience Measurement
Ad Solutions (Marketing Effectiveness)
Other
5.0 – 6.0%
10.0 – 15.0%
(5) – 0%
Watch
4.5 – 6.5%
Developed
Emerging
Buy
1.5 – 3.5%
8.0 – 10.0%
3.5 – 5.5%
Ongoing success with total audience measurement
Continued traction with digital ratings
Momentum in Ad Solutions (Marketing Effectiveness)
New client wins
Moderate recovery in global discretionary spend
Emerging markets fueled by local clients
Total Nielsen revenue expected to grow 4-6%
Note: Figures are as reported
35
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
LONG TERM FINANCIAL TARGETS
REVENUE GROWTH
MID-SINGLE DIGIT
ADJUSTED EBITDA GROWTH
1X - 2X REVENUE
EMERGING MARKET GROWTH
DOUBLE DIGIT
ADJUSTED NET INCOME PER SHARE GROWTH
DOUBLE DIGIT TO MID-TEENS
CASH TAX RATE
MID-TEENS TO LOW 20’S
TARGET LEVERAGE
3.0X AREA
DIVIDEND GROWTH
IN-LINE WITH EARNINGS
GROWTH
Note: All measures represented on constant currency basis; excludes Adjusted Net Income per share growth.
36
CERTAIN NON-GAAP MEASURES
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Overview of Non-GAAP Presentations
We use the non-GAAP financial measures discussed below to evaluate the results of our operations. We believe that the presentation of
these non-GAAP measures provides useful information to investors regarding financial and business trends related to our results of
operations, cash flows and indebtedness and that when this non-GAAP financial information is viewed with our GAAP financial
information, investors are provided with a more meaningful understanding of our ongoing operating performance. None of the nonGAAP measures presented should be considered as an alternative to net income or loss, operating income or loss, cash flows from
operating activities, total indebtedness or any other measures of operating performance and financial condition, liquidity or
indebtedness derived in accordance with GAAP. These non-GAAP measures have important limitations as analytical tools and should not
be considered in isolation or as substitutes for an analysis of our results as reported under GAAP. Our use of these terms may vary from
the use of similarly-titled measures by others in our industry due to the potential inconsistencies in the method of calculation and
differences due to items subject to interpretation.
Constant Currency Presentation
We evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation, which
is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency
information provides valuable supplemental information regarding our results of operations, consistent with how we evaluate our
performance. We calculate constant currency percentages by converting our prior-period local currency financial results using the
current period exchange rates and comparing these adjusted amounts to our current period reported results.
Net Debt and Net Debt Leverage Ratio
The net debt leverage ratio is defined as net debt (gross debt less cash and cash equivalents) as of the balance sheet date divided by
Adjusted EBITDA for the twelve months then ended. Net debt and the net debt leverage ratio are commonly used metrics to evaluate
and compare leverage between companies and are not presentations made in accordance with GAAP.
37
CERTAIN NON-GAAP MEASURES
(continued)
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Adjusted EBITDA
We define Adjusted EBITDA as net income or loss from our consolidated statements of operations before interest income and
expense, income taxes, depreciation and amortization, restructuring charges, goodwill and intangible asset impairment charges,
stock-based compensation expense and other non-operating items from our consolidated statements of operations as well as certain
other items considered unusual or non-recurring in nature. We use Adjusted EBITDA to measure our performance from period to
period both at the consolidated level as well as within our operating segments, to evaluate and fund incentive compensation
programs and to compare our results to those of our competitors.
Adjusted Net Income
We define Adjusted Net Income as net income or loss from our consolidated statements of operations before income taxes,
depreciation and amortization associated with acquired tangible and intangible assets, restructuring charges, goodwill and intangible
asset impairment charges, other non-operating items from our consolidated statements of operations and certain other items
considered unusual or non-recurring in nature, reduced by cash paid for income taxes. Also excluded from Adjusted Net Income is
interest expense attributable to the mandatorily convertible subordinated bonds converted on February 1, 2013. Adjusted Net
Income per share of common stock presented on a diluted basis includes the weighted-average amount of shares of common stock
convertible associated with the mandatorily convertible bonds based upon the average price of our common stock during the
periods beginning on or before February 1, 2013. Such shares are considered anti-dilutive in accordance with GAAP for the periods
presented.
Free Cash Flow
We define free cash flow as net cash provided by operating activities, normalized for non-recurring Arbitron transaction costs, less
capital expenditures. We believe providing free cash flow information provides valuable supplemental information regarding the
cash flow that may be available for discretionary use by us. Free cash flow is not a presentation made in accordance with GAAP.
38
ADJUSTED NET INCOME RECONCILIATION
($ in millions except per share amounts)
2010
2009
2008
$87
$133
$(489)
$(589)
(30)
(26)
13
132
257
4
171
89
47
39
307
91
510
1,339
–
(2)
34
119
47
80
386
122
493
1,243
–
(5)
135
85
34
12
443
6
502
1,012
–
(3)
219
83
27
112
614
(54)
530
1,236
–
(5)
(28)
59
18
44
598
(152)
519
608
402
22
84
60
14
36
633
26
462
789
95
7
6
118
18
54
1,837
(297)
(573)
1,617
(307)
(510)
1,504
(386)
(493)
1,450
(443)
(502)
1,324
(614)
(530)
1,226
(598)
(519)
1,087
(633)
(462)
204
162
145
161
196
211
208
(154)
(47)
(147)
(47)
(124)
(34)
(132)
(27)
(129)
(18)
(139)
(14)
(91)
(18)
--
2
23
21
–
–
–
Adjusted net income
970
770
Adjusted net income per share of common
$2.52
$2.02
stock, diluted
(a) Other items primarily consist of non-recurring items, sponsor termination fees (2011), and acquisition adjustments
635
528
229
167
91
$1.69
$1.44
$0.82
$0.61
$0.40
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Net income
(Income)/ loss from discontinued
operations, net of tax
Interest expense, net
Provision / (benefit) for income taxes
Depreciation and amortization
EBITDA
Impairment of goodwill and intangible
Equity in net (income)/ loss of affiliates
Other non-operating loss/(income), net
Restructuring charges
Stock-based compensation expense
Other items (a)
Adjusted EBITDA
Interest expense, net
Depreciation and amortization
Depreciation and amortization of
acquisition-related tangible and intangible
assets
Cash paid for income taxes
Stock-based compensation expense
Interest expense attributable to mandatory
convertible bonds
2014
2013
2012
$381
$736
$272
--
(305)
297
236
573
1,487
2011
39
WEIGHTED AVERAGE SHARES OUTSTANDING
($ in millions except per share amounts. Year ended December 31 for all years.)
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
2014
2013
2012
2011
2010
2009
Weighted-average shares of
common stock outstanding as of
December 31, basic
379,333,037
375,797,629
361,787,868
352,469,181
276,499,073
273,905,810
Dilutive shares of common stock
from stock compensation plans
5,038,415
5,130,337
4,523,116
5,032,773
3,153,513
–
--
896,994
10,416,700
9,531,994
–
–
384,371,452
381,824,960
376,727,684
367,033,948
279,652,586
273,905,810
Shares of common stock convertible
associated with the mandatory
convertible bonds
Weighted-average shares of
common stock outstanding as of
December 31, diluted
40
FREE CASH FLOW RECONCILIATION
($ in millions. Year ended December 31 for all years.)
Net cash provided by operating activities
Sponsor termination fee
Copyright ©2014
©2015 The Nielsen Company. Confidential and proprietary.
Capital expenditures
One-time Arbitron costs
Free Cash Flow
2014
2013
2012
$1,093
$901
--
2011
2010
$784
$641
$543
$517
–
–
102
–
–
(412)
(374)
(358)
(367)
(334)
(282)
--
$46
–
–
–
–
$681
$573
$426
$376
$209
$235
2009
41
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