Report rd Quarter Release - Johannesburg 14 November 2012

General Local Developments. Media Inflation Update Jan – June 2012 According to IBIS, for the six month period to June 2012, MIW inflation has remained stable at 10.4%. While print rate inflation is stable at under 5.5%, circulation declines have pushed MIW inflation to just under 12%. All categories of print have improved their MIW inflation with the exception of Community newspapers which increased as a result of a slight decrease in category circulation. Daily Press leads the print MIW table with 15.6%

General International up-date Herald Readership Numbers Mask Shrinking Circulation (November 12, 2012) The Boston Herald claimed that its print readership has increased 15 % over the past year to almost 500,000, but circulation numbers tell a different story. Circulation dropped 16% ! While they measure two different things, there is general acceptance that they are related. What is clear is that the debate is growing and that the relationship is more complex than initially thought. It would seem that for many titles the goal is to have circulation revenues rising rather than circulation numbers rising. Alan D. Mutter, a new media consultant stated that "The long-standing industry rule of thumb is that you get about 2.5 pass-along readers for every copy sold but, in an age when 50% of cellphones are smart phones, I have serious doubts that the number is a high today as it has been in the past.”

General Video advertising in printed magazines is here ! The October issue of Marie Claire (UK) saw the launch of a video ad in a magazine which is a UK media first.. “This is new for us here in the UK and has created the talkability factor offering a fantastic showpiece for advertisers with great creative and of course great budgets.” The tables have been turned to some extent with a digital platform using a print format and it is certainly refreshing to take online and put it offline rather than the other way round. It is essentially a bound-in insert with a screen inserted. The Marie Claire ad was for D&G.

Rule Amendments effective 1st July 2012: 1.Community Newspapers has changed to Local Newspapers. 2.Barter Deals are only applicable to Third Party Bulk Sales and Subscriptions – Travel and Commercial. 3.Where audits are conducted by the ABC, certified data may be issued prior to the audit being conducted. The audit will take place within 3 months of the audit period.

Membership Statistics:

Sector size ranked by average circulation – Quarter :

Overall Economic Perspective Comment: Retail Sales increased by 6.2%in the 3 months ended July 2012 compared to July The largest contributor was Retailers in textiles, clothing, footwear & leather goods. Real GDP at market prices increased by 3% quarter on quarter. The largest contributor was wholesale, retail, and motor trade, catering and accommodation.

Newspaper Performance Relative to Economic Measures. Comment: Total newspapers declined by copies compared to the previous quarter.

4 Year Category Trend by Quarter: Daily Newspapers Comment: Circulation has declined annually by 5.75 % since 2008, equivalent to 461,000 copies.

4 Year Trend Analysis by Language Daily Newspapers Comment: English titles have declined by 6.6% annually (397, 000 copies) over the period. Afrikaans titles have declined by 4.7% annually (72,000 copies) over the period. Vernacular titles have increased by 1.8% annually (8,500 copies) over the period.

4 Year Trend Analysis: Coastal vs Inland Daily Newspapers Comment: Inland circulation declined annually by 6.5% (342,000 copies) over the period. Coastal circulation declined annually by 4.3% (119,000 copies) over the period.

Titles Showing Largest Decline Daily Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1Cape Argus 33,00645, % 35, % 2 Star, The105,686136, % 98, % 3 Cape Times34,52343, % 37, % 4 Pretoria News19,23523, % 20, % 5 Sowetan101,155116, % 98, %

4 Year Category Trend by Quarter: Weekly Newspapers Comment: After showing a decline during 2009 and 2012, weekly newspapers have recovered to reflect an annual increase of 1.7% (46,000 copies) over the period.

Titles Showing Largest Growth Weekly Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Motorsport World4,2462, % 3, % 2 Soccer Laduma360,668345, % 306, %

Titles Showing Largest Decline Weekly Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1UmAfrika10,06514, % 12, % 2 Ilanga124,200135, % 128, %

4 Year Category Trend by Quarter: Weekend Newspapers Comment: Circulation has declined annually by 3.0% (342,000 copies) over the period.

4 Year Trend Analysis by Language: Weekend Newspapers Comment: English titles have declined annually by 4.8% (401,000 copies) over the period. Afrikaans titles have declined by annually by 3.0% (83,000 copies) over the period. Vernacular titles have grown annually by 33.2% (142,000 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 Isolezwe ngeSonto84,57781, % 90, % 2 Volksblad - Saturday21,76221, % 21, %

Titles Showing Largest Decline Weekend Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1Saturday Star, The75,68297, % 82, % 2 Pretoria News Saturday11,17414, % 11, % 3 Sondag39,08547, % 39, %

4 Year Category Trend by Quarter: Local Newspapers Comment: Local Newspapers have declined by 1.4% (32,000 copies) over the period.

New Members / Removals Local Newspapers

Titles Showing Largest Growth Local Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Tembisan9,1247, % 9, % 2 Palaborwa Herald2,8722, % 2, % 3 Representative5,8675, % 5, %

Titles Showing Largest Decline Local Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Vryheid Herald2,9863, % 3, % 2 Limpopo Informant2,6673, % 2, % 3 Streeknuus2,7363, % 3, % 4 Eikestadnuus5,9566, % 5, %

4 Year Category Trend by Quarter: Hybrid Newspapers Comment: Circulation has increased annually by 4.7% (29,000 copies) over the period.

New Members / Removals Hybrid Newspapers

4 Year Category Trend by Quarter: Free Newspapers Comment: Distribution has increased annually by 5% (1,148,000 copies) over the period.

New Members / Removals Free Newspapers

Titles Showing Largest Growth Free Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Zululand Eyethu (formerly Eshowe Watch)24,2406, % 20, % 2 Kalahari Buletin (Formerly Kuruman Bulletin)19,87512, % 19, % 3 City Vision (Langa/Gugulethu)49,63440, % 49, % 4 Corridor Gazette5,8004, % 5, % 5 Sasolburg Ster14,95112, % 14, %

Titles Showing Largest Decline Free Newspapers No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Algoa Sun 20,37149, % 20, % 2 Theewaterkloof Gazette (Formerly Kontreinuus Gaz.)10,64016, % 10, % 3 Cosmos Gazette 19,95024, % 24, % 4 Helderberg Gazette. 30,95035, % 30, % 5 Stellenbosch Gazette (formerly Gazette)17,97020, % 17, %

Magazine Performance Relative to Economic Measures. Comment: Total magazines declined by 0.2% over the previous quarter. Consumer magazines decreased by 3.7% over the previous quarter.

4 Year Category Trend by Quarter: Consumer Magazines Comment: Circulation increased annually by 1.4% (406,000 copies) over the period.

New Members / Removals Consumer Magazines

Titles Showing Largest Growth Consumer Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Kuier78,89647, % 72, % 2 Tuis Dekorgids / Home Décor Guide (Annual)31,34723, % 3 Kick Off61,14045, % 56, % 4 Living and Loving29,25721, % 25, %

Titles Showing Largest Decline Consumer Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Playboy3,83910, % 16, % 2 Cars in Action4,70913, % 6, % 3 The Red Bulletin68,461135, % 76, % 4 Prestige9,33415, % 8, %

4 Year Category Trend by Quarter: Consumer Magazines - Home Comment: Circulation increased annually by 5.4% (167,000 copies) over the period..

4 Year Category Trend by Quarter: Consumer Magazines - Sport and Hobby Comment: Circulation increased by 1.3% annually (29,000 copies) over the period.

4 Year Category Trend by Quarter: Consumer Magazines - Travel Comment: Circulation increased annually by 23% (315,000 copies) over the period.

4 Year Category Trend by Quarter: Consumer Magazines – Woman’s General Comment: This category has fluctuated considerably. Circulation declined by 1.9% annually (151,000 copies) over the period.

4 Year Category Trend by Quarter: Business to Business Magazines Comment: Circulation has remained static over the period.

New Members / Removals Business to Business Magazines

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 South Africa in the Palm of your Hand (Annual)26,7306, % 2 Afropolitan (Six- Monthly)7,0494, % 3 Technology in Architecture & Design (Six-Monthly)4,8463, % 4 Northern Cape Business (Annual)14,71310, % 5 Construction Review1,7801, % 1, %

Titles Showing Largest Decline Business to Business Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Conference Venues (Annual)4,83011, % 2 Pedmed (Six- Monthly)3,6895, % 3 African Mines Handbook (Annual)1,2261, % 4 Agricultural Machinery Dealer's Guide (Six-Monthly) % 5 Screen Africa3,2013, % 3, %

4 Year Category Trend by Quarter: B2B Magazines – Hospitality, Catering and Tourism Comment: Circulation declined annually by 5.0% (27,000 copies) over the period.

4 Year Category Trend by Quarter: B2B Magazines – Management Comment: Circulation declined annually by 6.3% (95,000 copies) over the period.

4 Year Category Trend by Quarter: Custom Magazines Comment: Circulation increased annually by 1.2% (666,000 copies) over the period.

New Members / Removals Custom Magazines

Titles Showing Largest Growth Custom Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 J S E (Annual)28,77814, % 2 Mercedes (Annual)26,35215, % 3 Foschini Soccer Club66,99939, % 61, % 4 Reality (Annual)177,279110, % 5 Foschini Living Space59,69239, % 56, %

Titles Showing Largest Decline Custom Magazines No Publication Name TOTAL CIRCULATION Corresponding Previous Period Variance - Prior Year Previous Quarter Variance - Previous Quarter 1 Beares Club (Annual)69,258125, % 2 Geen & Richards Club (Annual)10,75615, % 3 Q-One Student Diary (Annual)106,001155, % 4 Blue Train, The7501, % % 5 Ellerines Club (Annual)152,450212, %

4 Year Category Trend by Quarter: Custom Magazines – Entertainment Comment: Circulation increased annually by 5.2% (553,000 copies) over the period.

4 Year Category Trend by Quarter: Custom Magazines – Retail Comment: Circulation increased annually by 1.4% (408,000 copies) over the period.

4 Year Category Trend by Quarter: Free Magazines Comment: Circulation declined annually by 18.5%, over the period.

New Members / Removals Free Magazines

Observations: Times remain tough for all in the print industry. Current GDP projections indicate that we will achieve a 2.5% GDP growth albeit that our CPI inflation is just over 6%. The Daily Newspaper category continues to decline with several sharp drops in total circulation. That said, vernacular circulation growth continues Weeklies have posted solid growth. The Weekend English and Afrikaans categories continues to slide while vernacular growth continues. Local Newspapers are down overall. However, several titles reflect strong growth including Tembisan. Free Newspapers are stable overall, but it would be remiss not to mention again the startling growth of the Zululand Eyethu, up 303%.

While overall Consumer magazine circulation is down sharply, we still see strong growth from titles such as: Kuier: up 67%, Kick-off: up 34%, and Living and Loving: up 33%. Playboy, dropped 64%. Business to Business dropped slightly. While the Custom category grew marginally overall, we noted several postings reflecting strong growth, including; JSE Annual (+101%), Mercedes-Benz Annual (+72%), Foschini Sport (+68%).. There is no doubt that while some titles continue to grow, overall the general poor health of the economy and cost cutting measures by publishers will increasing shape the print landscape. We have companies up for sale, others with new owners and even within the most stable, the very real chance of retrenchments and further title closures. It’s going to be a tough Christmas.

Thank you.

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