1Q 2013 INVESTOR PRESENTATION APRIL 2013
FORWARD-LOOKING STATEMENTS 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. 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://ir.nielsen.com. 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 as of April 25, 2013 for the purpose of providing information about current expectations for 2013. This information may not be appropriate for other purposes. 2
WHO WE ARE OUR MISSION To provide clients with the most complete understanding of their consumers and markets worldwide OUR VALUES Open Simple Integrated OUR BRAND Quality Integrity Neutrality 3
NIELSEN INVESTMENT HIGHLIGHTS Comprehensive understanding of what consumers buy and watch Global leader in our segments with market presence in ~100 countries Mission critical measurement and analytics embedded in client workflows Syndicated, scalable products and services Favorable market trends provide organic growth opportunities Proven track record of growth and economic resilience Accelerated earnings growth through deleveraging Return of capital to shareholders through dividend Focus on sustainable shareholder value 4
NIELSEN STRATEGY BUY Expand coverage of consumer purchase behavior globally WATCH Measure more ways that consumers spend time with media BUY + WATCH Understand how media consumption relates to purchase behavior 5
NIELSEN S BUSINESSES WHAT CONSUMERS BUY WHAT CONSUMERS WATCH We provide Retail measurement of sales, market share and analytics for consumer goods Measurement and analytics for content, advertising, and activity for TV, digital, social We help Consumer packaged goods manufacturers, retailers Media companies, content distributors, online publishers, tech players Client example > 80 markets worldwide 50+ year relationship Multi-year contract 70+ year relationship Our measurement and analytics are embedded in our clients operating disciplines 6
WE ARE EXPERT IN MEASURING CONSUMERS WHAT CONSUMERS BUY MEASURING MORE MEDIA CONSUMPTION Retail E-commerce WHAT CONSUMERS WATCH BROADER MEASUREMENT PLATFORM Average Time Spent per Person per Day 1 ~1 hr ~2 hrs ~8 hrs ~5 hrs TV/Video Digital/Social Radio/Music TV Radio Online/Mobile Total (1) Nielsen Cross-Platform Report: Based on Total US Population, Persons 2+ for TV and Online, (Home and Work) 13+ for Mobile; 2 nd Qtr 2012; Arbitron Radio Today, 2012 7
SOLID FIRST QUARTER PERFORMANCE FINANCIAL RESULTS Revenue grew 3%...up 4% constant currency Adjusted EBITDA grew 5%...up 6% constant currency Adjusted Net Income grew 26%...up 29% constant currency No change in growth investments Strong free cash flow growth supports dividend Arbitron shareholders approved transaction regulatory process ongoing Reaffirming 2013 guidance KEY INITIATIVES Buy: Expanding coverage Continuing to drive investment and growth in Africa, China, India Activating our Buy data Global Track, Total Store Read, Brand Dashboard Watch: Measuring more audiences Enhancing value to clients with Ad Solutions Increasing reach of OCR/XCR platforms to bridge digital world Developing Social TV ratings Expanding measurement for TV, digital Note: Please see the Appendix for a reconciliation to net income to Adjusted EBITDA and Adjusted Net Income. 8
FOREIGN CURRENCY IMPACT 2012 REVENUE DISTRIBUTION FX IMPACT: REPORTED VS. CONSTANT CURRENCY REVENUE By Currency As Reported Projected Impact (a) 100 FX impact (bps) 10 U.S. $ 52% Euro 12% -100 (130) (50) (250) (90) (10) (60) (40) Other 36% -300 (430) (390) -500 1Q12 2Q12 3Q12 4Q12 FY12 1Q13 2Q13E 3Q13E 4Q13E FY13E (a) Projected impact assumes rates in effect at 4/23/13 remain in effect for the balance of 2013. Also based on company estimates for future quarters on distribution of revenue by currency. We report on a constant currency basis to reflect operating performance 9
STEADY SEGMENT REVENUE GROWTH BUY SEGMENT ($ MILLIONS) 3500 $3,409 $3,420 WATCH SEGMENT ($ MILLIONS) 2200 3000 2500 $2,861 $3,108 2000 1800 $1,751 $1,827 $1,919 $1,987 2000 1600 1500 1400 1000 1200 500 2009 2010 2011 2012 1000 2009 2010 2011 2012 CONSTANT CURRENCY GROWTH NA 8% 7% 4% CONSTANT CURRENCY GROWTH NA 4% 4% 4% Note: Revenue growth rates derived on a constant currency basis; figures are as reported 2009 constant currency growth by segment is unavailable due to re-segmenting completed in December 2011 In March 2013, we completed the exit and shut down of our legacy online business and recorded a net loss of $3 million associated with this divestiture. All periods have been adjusted to exclude the impact of the discontinued operations. 10
NIELSEN IS MORE IMPORTANT THAN EVER Key trends provide organic growth opportunities Growth in developing markets Consumer demographic shifts More media choices Consumers more connected 11
TRENDS SHAPING WHAT CONSUMERS BUY PROJECTED INCREASE IN GLOBAL MIDDLE CLASS & SPENDING (1) NIELSEN DEVELOPING MARKETS REVENUE (2) 8 7 6 5 4 3 2 1 $50B $35B $22B 5.0 3.3 1.9 2009 2020E 2030E 60 50 40 30 20 10 0 1200 1000 800 600 400 200 0 CAGR = 12% $1,133 $696 2007 2012 Global Middle Class (billions) Spending by Middle Class Developing markets provide greatest opportunity for sustained growth (1) Source: The Emerging Middle Class in Developing Countries, Organization for Economic Cooperation and Development, 2010 (2) Revenue growth rate derived on a constant currency basis 12
OUR GLOBAL BREADTH AND DEPTH Nielsen presence Client Trends Past: West East Future: West East Well-positioned to fulfill client needs around the world 13
TRENDS SHAPING WHAT CONSUMERS WATCH MORE CHOICES AND PLATFORMS (1) % ADVERTISING SPEND BY MEDIUM (2) Device Ownership Among Americans Within TV Homes 2011 2015E Own at least one TV 289M 37% 30% 7% SMART- PHONES HD HDTV DVD Player 86% HD Capable 75% OVER-THE-TOP TABLETS DISTRIBUTION SMART TV WITH SOCIAL CAPABILITIES DVR APP DRIVEN DIGITAL WORLD 47% Satellite 33% 16% 40% 7% 23% 40% Video Game Console 56% Digital Cable 52% Tablet 16% Internet-Enabled TV 4% TELEVISION INTERNET PRINT AND OTHER RADIO (1) Source: Nielsen State of the Media: U.S. Consumer Usage Report 2012 (January 7, 2013) (2) Source: ZenithOptimedia, ZenithOptimedia Forecasts 4.1% Growth in Ad Spend in 2013, December 3, 2012 14
HELPING CLIENTS ASSESS MARKETING ROI REACH Who did program or ad reach? RESONANCE Did it change attitudes? REACTION Did it change behavior? Reach and frequency (GRP), demographics Brand recall, likeability, loyalty, purchase intent Buy + Watch 15
COMPELLING FINANCIAL MODEL PRIORITIES RESULTS Consistent growth 5% revenue CAGR from 08 to 12 (1) 27 quarters of consecutive growth Developing markets growth opportunity Recurring revenue Operating leverage Deleveraging High renewal rates 70% recurring across Watch & Buy 30+ year relationship with top clients Sustainable operating efficiencies Adjusted EBITDA margin benefit Significant market/product reinvestment Net debt ratio reduced from 9.1x at 12/31/06 to 3.76x at 3/31/13 (2) Lowering rate, extending maturities Sustainable, low cash tax rate (1) Based on constant currency growth (2) Reflects net debt (gross debt minus cash), divided by Adjusted EBITDA calculated on last twelve months basis. 16
CAPITAL ALLOCATION AND RETURN Focus on shareholder value DEBT MATURITY PROFILE (1) ($ MILLIONS) 2969 1083 733 800 348 124 151 0 2013 2014 2015 2016 2017 2018 2019 2020 DELEVERAGING PROGRESS (2) 9.1x 7.9x 7.4x 6.2x 5.8x 4.0x 3.75x 3.76x CAPITAL ALLOCATION Priorities for free cash flow Investing in growth Paying down debt Returning capital to shareholders Capital Return Dividend initiated 1Q13 Quarterly payment of $0.16 per share Target capital structure Net debt ratio of 2.75-3.0x Optimize for future maturities and refinancing needs in 2016-2018 2006 2007 2008 2009 2010 2011 2012 1Q13 (1) Reflects 3/31/13 debt balances. Figures exclude capital leases and bank overdrafts (2) Reflects net debt (gross debt minus cash), divided by Adjusted EBITDA calculated on last twelve months basis. Excludes $288M of mandatory convertible subordinated debt which converted to equity in February 2013, but includes all other debt, including capital leases 17
LONG TERM FINANCIAL FRAMEWORK REVENUE GROWTH MID-SINGLE DIGIT ADJUSTED EBITDA GROWTH ~1-2X REVENUE GROWTH DEVELOPING MARKET GROWTH DOUBLE DIGIT ADJUSTED NET INCOME GROWTH ~2-3X ADJ. EBITDA GROWTH TARGET LEVERAGE 2.75 3.0X NET DEBT RATIO CAPITAL RETURN QUARTERLY DIVIDEND Note: All measures represented on constant currency basis 18
APPENDIX
QUARTERLY FINANCIAL PERFORMANCE REVENUE ($ MILLIONS) 1600 ADJUSTED EBITDA ($ MILLIONS) 500 1400 1200 $1,334 $1,380 $1,418 $1,458 $1,376 400 $390 $425 $457 1000 300 $333 $349 800 600 200 400 100 200 0 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 0 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 CONSTANT CURRENCY GROWTH 4.2% 3.6% 4.6% 3.6% 4.0% ADJUSTED EBITDA MARGIN 25.0% 28.3% 30.0% 31.3% 25.4% Note: Revenue growth rates derived on a constant currency basis; figures and Adjusted EBITDA margin are as reported. In March 2013, we completed the exit and shut down of our legacy online business and recorded a net loss of $3 million associated with this divestiture. All periods have been adjusted to exclude the impact of the discontinued operations. 20
QUARTERLY FINANCIAL PERFORMANCE REVENUE ($ MILLIONS) ADJUSTED EBITDA (1) ($ MILLIONS) 1600 1400 1200 1000 800 600 400 $61 $474 $799 $38 $67 $493 $499 $849 $852 $17 $521 $920 $57 $494 $825 500 400 300 200 100 $36 $186 $121 $41 $14 $213 $213 $169 $175 $3 $234 $221 $32 $199 $124 200 0 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 0 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 Buy Watch Expo (1) The representation by segment does not include Corporate, which contributes to the full view of total Adjusted EBITDA for the Company Note: Figures are as reported In March 2013, we completed the exit and shut down of our legacy online business and recorded a net loss of $3 million associated with this divestiture. All periods have been adjusted to exclude the impact of the discontinued operations. 21
ANNUAL PERFORMANCE BY SEGMENT REVENUE ($ MILLIONS) ADJUSTED EBITDA (1) ($ MILLIONS) 6000 $179 $183 2000 5000 4000 3000 $180 $1,751 $2,861 $168 $1,827 $3,108 $1,919 $1,987 $3,409 $3,420 1500 1000 $63 $670 $78 $701 $94 $87 $778 $846 2000 500 $595 $656 $699 $686 1000 0 2009 2010 2011 2012 0 2009 2010 2011 2012 Buy Watch Expo (1) The representation by segment does not include Corporate, which contributes to the full view of total Adjusted EBITDA for the Company Note: Figures are as reported In March 2013, we completed the exit and shut down of our legacy online business and recorded a net loss of $3 million associated with this divestiture. All periods have been adjusted to exclude the impact of the discontinued operations. 22
CERTAIN NON-GAAP MEASURES Overview of Non-GAAP Presentations We consistently use the below non-gaap financial measures 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 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 non-gaap measures presented should be considered as an alternative to net income or loss, operating income or loss, cash flows from operating activities or any other performance measures of operating performance or liquidity 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. 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 as of the balance sheet date divided by Adjusted EBITDA for the twelve months then ended. Net debt calculations exclude 288M of mandatory convertible subordinated debt due 2013. Net debt and the net debt leverage ratio are not presentations made in accordance with GAAP, and 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. 23
CERTAIN NON-GAAP MEASURES (continued) 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. Adjusted EBITDA is not a presentation made in accordance with GAAP, and our use of the term Adjusted EBITDA 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. We use Adjusted EBITDA to consistently 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 mandatory convertible subordinated bonds due 2013. 24
ADJUSTED NET INCOME RECONCILIATION: Q1 ($ in millions except per share amounts) Quarter ended March 31, (Unaudited) 2013 2012 Net income $ 34 $ 25 Loss from discontinued operations, net of tax 3 2 Interest expense, net 82 105 Provision for income taxes 27 8 Depreciation and amortization 126 129 EBITDA 272 269 Equity in net loss of affiliates 1 2 Other non-operating expense, net 24 15 Restructuring charges 35 37 Stock-based compensation expense 10 8 Other items (a) 7 2 Adjusted EBITDA 349 333 Interest expense, net (82) (105) Depreciation and amortization (126) (129) Depreciation and amortization of acquisition-related tangible and intangible assets 41 41 Cash paid for income taxes (29) (23) Stock-based compensation expense (10) (8) Interest expense attributable to mandatory convertible bonds 2 6 Adjusted net income $ 145 $ 115 Adjusted net income per share of common stock, diluted (b) $0.38 $0.31 (a), (b) See footnotes on next page 25
ADJUSTED NET INCOME RECONCILIATION: Q1 (continued) (a) (b) Other items primarily consist of transaction-related fees. Adjusted Net Income per share of common stock presented on a diluted basis includes potential common shares associated with stock-based compensation plans that may have been considered antidilutive in accordance with GAAP. The amount also includes the weighted-average amount of shares of common stock convertible associated with the mandatory convertible bonds based upon the average price of our common stock during the period. Weighted-average shares of common stock outstanding as of quarter ended March 31, 2013, basic 370,583,217 Dilutive shares of common stock from stock compensation plans 4,973,804 Shares of common stock convertible associated with the mandatory convertible bonds 3,587,974 Weighted-average shares of common stock outstanding, diluted 379,144,995 26
FREE CASH FLOW RECONCILIATION ($ in millions) QUARTER ENDED MARCH 31 2013 2012 Net cash provided by/(used in) operating activities $54 $(3) Capital expenditures (70) (82) Free Cash Flow $(16) $(85) 27
SELECTED CASH FLOW & BALANCE SHEET ITEMS ($ in millions) CASH FLOW 1Q 13 CAPITAL TABLE Free Cash Flow $(16) 3/31/13 12/31/12 Change Capex $70 Cash Taxes $29 Restructuring $21 Loan Debt (secured) $4,113 $4,090 $23 11.625% Sr. Notes 210 209 1 7.75% Sr. Notes 1,084 1,084 -- 4.50% Sr. Notes 800 800 -- BALANCE SHEET 3/31/13 Gross Debt $6,320 Cash $233 Net Debt $6,087 Net Debt Ratio (b) 3.76x Capital lease/misc. debt 113 113 -- Total Debt $6,320 $6,296 (a) 24 Less Cash 233 288 (55) Net Debt $6,087 $6,008 79 Net Debt Ratio (b) 3.76x 3.75x.01x Weighted avg. interest rate (a) 4.49% 4.86% (37) bps (a) (b) Does not include $288 million of mandatory convertible subordinated bonds converted into common shares February 2013; weighted avg. interest rate calculated based on amount outstanding at end of quarter Reflects Net Debt divided by Adjusted EBITDA calculated on last twelve months basis. 28
UNAUDITED SUPPLEMENTAL INFORMATION In March 2013, we completed the exit and shut down of one of our legacy online businesses and recorded a net loss of $3 million associated with this divestiture. The condensed consolidated statements of operations reflect the operating results of this business as a discontinued operation. Note that the discontinued operations had no impact on our Buy or Expositions segments. Summarized results of operations for this discontinued operation for the three months ended March 31, 2013 are as follows: Quarter ended (in millions) March 31, 2013 Revenues $ 3 Adjusted EBITDA $ (2) The below tables detail supplemental unaudited Total Nielsen and Watch segment revenues and Adjusted EBITDA, which have been adjusted to reflect the impact of the discontinued operations on our historical operating results, for each of the quarterly periods in the two years ended December 31, 2012 and 2011. Revenues Watch Revised YoY Growth (a) Total Nielsen Revised YoY Growth (a) (in millions) 2012 1Q 2012 $ 474 3.0% $ 1,334 4.2% 2Q 2012 493 4.2% 1,380 3.6% 3Q 2012 499 5.5% 1,418 4.6% 4Q 2012 521 5.0% 1,458 3.6% Total $ 1,987 4.5% $ 5,590 4.0% 2011 1Q 2011 $ 462 6.2% $ 1,296 7.2% 2Q 2011 481 1.7% 1,390 4.9% 3Q 2011 479 4.4% 1,407 5.9% 4Q 2011 497 2.9% 1,414 4.7% Total $ 1,919 3.7% $ 5,507 5.6% Adjusted EBITDA Watch Total Nielsen (in millions) 2012 1Q 2012 $ 186 $ 333 2Q 2012 213 390 3Q 2012 213 425 4Q 2012 234 457 Total $ 846 $ 1,605 2011 1Q 2011 $ 176 $ 319 2Q 2011 199 386 3Q 2011 195 408 4Q 2011 208 430 Total $ 778 $ 1,543 (a) Year-over-year growth in constant currency 29