CAPITAL MARKETS DAY 2020 - Media and Games Invest plc

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CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
CAPITAL MARKETS
DAY 2020
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
Disclaimer

Cautionary note regarding forward-looking statements

This presentation contains forward-looking statements. These statements are based on current estimates and
projections    of     the    Board    of     Executive     Directors    and     currently   available    information.
Forward-looking statements are not guarantees of the future developments and results outlined therein. These are
dependent on a number of factors; they involve various risks and uncertainties; and they are based on assumptions
that may not prove to be accurate. Such risk factors include those discussed in Opportunities and Risks on pages 4 to
16 of the Company Description (Link: https://mgi.group/wp-content/uploads/2020/09/Media-and-Games-Invest-plc.-
Company-description-secure.pdf). MGI does not assume any obligation to update the forward-looking statements
contained in this presentation and beyond the legal requirements.
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
I.     Introduction
       I.     Overview MGI
       II.    Market Overview
       III.   Strategy
II.    Gaming
       I.     Overview
       II.    Portfolio Impressions
       III.   Community Impressions
       IV.    Review 2019 an Q1 2020
       V.     Preview 2020
III.   Media
       I.     What we do
       II.    Buy & Build
       III.   Outlook
IV.    Financials
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
Todays presenters

        REMCO WESTERMANN,
                                                                                   PAUL ECHT,
        CEO & Chairman of the Board
                                                                                   CFO
        ▪     Manager, entrepreneur & investor; more than 25 years                 ▪      Finance Manager with more than 10 years experience in the
              experience in various leadership positions                                  tech and finance industry
        ▪     Founding, reorganizing and growing various companies in the          ▪      Previously; UniCredit Bank and Shopgate Inc., M.A. in Finance
              new technologies and media sector, Sonra, Bob Mobile/ Cliq                  and Bachelor of Laws (LL.B.)
              Digital, MSc at Erasmus University, Rotterdam

                                                                               IONUT CIOBOTARU,
        JENS KNAUBER,
                                                                               CPO
        COO
        ▪     More than 10 years experience as manager in the gaming           ▪         founded the mobile monetization platform PubNative and has
              industry – over 300 published games                                        15+ years of experience in the ad-tech industry, previously
                                                                                         working for Applift, Weebo and EA.
        ▪     Held a series of leadership positions at Hamburg publisher dtp
                                                                               ▪         Holding a degree in Psychology and a M.D. in General Medicine.
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
Building a Global Games and Media Powerhouse
Leveraging the value chains of gaming and media; low risk, continues & profitable growth

                                                  Fast growth                             combining M&A and organic growth

                                                  Profitability                   focus on high margin and recurring revenues

                                                  Tech focus             technology as a driver of success; USP’s and efficiency

                                                 Synergy focus                integrating acquisitions & optimizing value chain

                                                 Low risk focus              no new game dev., focus on ROI, distressed M&A

                                               Shareholder value            mix of own cash-flow, listed equity and non-equity
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
MGI at a Glance
Substance and access to capital markets; access to millions of customers

                           GAMING                                                              MEDIA
                       2012     first acquisition gamigo
                                                                               2016     first acquisition seven games media

                       2018     MGI acquires gamigo
                                                                               2019     Entry of ad-tech acquiring Applift & Pubnative

                       20+      M&A transactions
                                                                               10+      M&A transactions

                                                                               EUR 40m Revenues 2019
                       43m+      Revenues (2019)
                                                                               EUR 3m Ebitda 2019
                       12m+      Ebitda (2019)

                                                                               350+     Employees
                       300+     Employees

                                                                               4k+ Direct integrations & SDK apps
                       25+    MMOs (Massive Multiplayer Online games)          5b+ Monthly Ads delivered
                       5,000+ Casual games                                     Top Fortune 500 Advertisers and Global digital Brands

                       5,000,000+ Monthly active players                       +2bn monthly video views
                                                                               +750m subscribers across all channels

                                                   +80m revenues and +15m EBITDA
                  Media and Games Invest is listed at Frankfurt Stock Exchange with a Market Cap of more than +100m
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
Strong Team

  Board of Directors                                                    Top Management Team

   Tobias Weitzel           Elizabeth Para           Remco Westermann    Paul Echt   Gary Coffey   Jens Knauber   Stefan Rascher
   Non-executive Director   Non-executive Director   Chairman of the     CFO         COO           COO            CSO
                                                     Board & CEO
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
MGI GROUP: acting worldwide
We serve our gamers and customers worldwide with +20 local offices

                              Europe
                              ○   Berlin
                              ○   Cologne
                              ○   Darmstadt
North America                 ○   Hamburg       Asia
○   Austin                    ○   Istanbul      ○   Beijing
○   Carlsbad                  ○   Moskow        ○   Shanghai
○   Chicago                   ○   Tel Aviv      ○   Seoul
○   New York
                                                ○   Singapore
○   San Diego
                                                ○   Tokyo
○   Seattle
○   Washington DC

          LATAM
           ○ São Paulo
           ○ Buenos                           Oceania
             Aires                            ○ Sydney
           ○ Mexico City
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
Market overview
CAPITAL MARKETS DAY 2020 - Media and Games Invest plc
Gaming: a substantial growth market
Largest entertainment market; continues fast growth

                                                Games market; USD +150bn                                                      Megatrend: More Leisure Time
                   200                                                                                                        ▪   Favored form of entertainment;
                                                                             CAGR +11%
                                                                                                                      180.1       interactive, rewarding, social
                   180                                                                                                        ▪   Gaming market is bigger than the
                                                                                                              165.9
                   160                                                                                                            market for books, music and films
                                                                                                      151.9
                   140                                                                        137.9
                                                                                                                              Mass Market
                                                                                      121.7
     USD billion

                   120                                                                                                        ▪   More than two billion players worldwide
                                                                              106.5
                   100                                                93.1                                                    ▪   42% of all Germans are playing, 41% of
                                                      84.8                                                                        whom are female, 29% over the age of 50
                    80                    76.5
                              70.6
                    60                                                                                                        Growth opportunities
                                                                                                                              ▪   Fragmented market
                    40
                                                                                                                              ▪   Driven by hits, some with billions in
                    20                                                                                                            revenues, but also failures
                                                                                                                              ▪   High growth and high margins
                       0
                              2012 2013 2014 2015 2016 2017 2018E 2019E 2020E 2021E                                           ▪   Market consolidation, numerous M&A
                                                                                                                                  candidates
                                 Console Gaming                                PC Games               Mobile Games
                   Source: Newzoo - Global Games Market Report 2020
Media: a substantial growth market
Monetizing digital media, advertising products and services: a very fragmented large market

                                                            Online advertising; USD +290 Mrd.
                                                                                                                                                     Megatrend: programmatic ads
                                                                                             CAGR +16%                                               ▪   Digital advertising has bypassed offline advertising
                                                                                                                                              434    ▪   Programmatic exchanges and bidding are more
                                                                                                                                401
                                                                                                                367                                      efficient and winning
                                                                                                   330
                                                                          294                                                                        Fragmented Market
                                                  258
                          178                                                                                                                        ▪   Fast growing number of channels, apps and players
 USD billion

                                                                                                                                                     ▪   From managed to self-serve; giants (Google, Tencent,
                                                                                                                                                         Facebook) and many others

                                                                                                                                                     Growth opportunities
                                                                                                                                                     ▪   Fragmented market
                        2017                     2018                    2019                    2020E          2021E          2022E         2023E   ▪   Driven by technical change and optimization; AI,
                                                                                                                                                         programmatic and tracking
                                Search engine advertising                         Banner advertising                    Social media advertising
                                                                                                                                                     ▪   High growth and good margins
                                Video Advertising                                 Online classified ads
                                                                                                                                                     ▪   Market consolidation, numerous M&A candidates
               Source: Statista, April 2019; Digital Market Outlook / worldwide market for online advertising
Media & Games: synergetic sectors
Higher efficiency, larger part of the value, more data, faster growth

                                                                        Value-Chain optimization: cheaper user acquisition
                                                                        ▪   Scale advantage with ad-buying
                                                                        ▪   Additional margin from ad-buying stays in-house
                                                                        ▪   Better data to optimize ad-buying
                                Games                                   ▪   Don’t need huge in-house advertising team: know-how
                                                                            sharing

                                           item sale                    Value-Chain optimization: more ad-income
 media for user      user        playing
  acquisition     acquisition     user                      selling     ▪   Direct to advertiser sale: higher price per ad
                                           advertising                  ▪   Additional margin from ad-selling stays in house
                                                         ads in games
                                                                        ▪   Better fill-rate

                                                                        Media business: profitable 3rd party business
                                Media                                   ▪   Clear USP by offering unique first party ads in games
                                                                        ▪   Substantial additional ad-purchase budget enables
                                                                            volume guarantees and monetization of remnant
                                                                        ▪   Improved optimization: joint customer data platform,
                                                                            optimized targeting
Strategy
MGI “buy, integrate, build & improve”
Consequently implementing this strategy since 7 years, executing 30+ M&A cases

                     Buy                                   Integrate                     Build & Improve

                      =                                        =                                =
             Market consolidation                      Restructuring &                 Organic sales growth
                  via M&A                             realizing synergies

         ▪   M&A focus distressed &               ▪   Cost efficiency; unified     ▪   Product and technology
             in efficient companies                   management structure             improvements
         ▪   Also M&A of accretive                ▪   Technical integration; one   ▪   Increase number of users
             technology, product &                    platform & one cloud             and customers
             customer bases.
                                                  ▪   Cost savings; cancel or      ▪   Internationalization
                                                      renegotiate contracts,
                                                      merge offices
MGI “buy, integrate, build & improve”
30+ Company and asset purchases: 20+ in gaming, 10+ in media.

                                                                              Pipeline Games M&A:
                                                                   M&A            # M&A        Cumulative
                                                                 process        candidates      Revenue
                                                                  status                        (mEUR)

                Buy                                             Shortlist          >40              > 400

                                                                Contacted          >17              > 200

                                                                 In talks           7               > 100

                 =
                                                                             Pipeline Media M&A:
        Market consolidation
                                                                    M&A             # M&A      Cumulative
             via M&A
                                                                  process         candidates    Revenue
                                                                   status                        (EUR)
                                                                  Shortlist          > 27           > 500

                                                                 Contacted           >9             > 300

                                                                  In talks              5           > 100
MGI “buy, integrate, build & improve”
Restructuring and thereafter integration leads to fast turn-arounds and use of synergies

                                                                            Synergies Games:
                                                                            ▪ Joint customer base: upselling & lifetime cycle
                                                                            ▪ Customer acquisition: ad-efficiency
           Integrate
                                                                            ▪ Datacenter -> cloud
                                                                            ▪ Integration of backends -> 1 backend
                                                                            ▪ Joint customer care & customer management
                                                                            ▪ Team optimization & know how sharing
                                Gaming Unit
                                                                            ▪ Overhead synergies (management, offices)

                =
        Restructuring &
       realizing synergies                                                  Synergies Media:
                                 Media Unit
                                                                            ▪ Joint customer base: upselling
                                                                            ▪ Customer acquisition: global sales team
                                                                            ▪ Datacenter -> cloud
                                                                            ▪ Tech-integration -> 1 united tech-stack
                                                                            ▪ Joint operations, supply development
                                                                            ▪ Team optimization & know how sharing
                                                                            ▪ Overhead synergies (management, offices)
MGI “buy, integrate, build & improve”
Focus on quality, increase of customer base, and product innovation drives organic growth

                                                                 ▪ Exciting new content, updates for games portfolio
                                                                 ▪ New game launches (licensed) and sequels (in-house)
           Build & Improve
                                                                 ▪ Improving the games; bug fixing, active community
                                                                   management
                                                                 ▪ Increasing new users and paying users
                                                                 ▪ Internationalization

                  =
                                                                 ▪ Active sale and upselling of products and services
         Organic sales growth                                      globally
                                                                 ▪ Increasing and training sales and operations teams
                                                                 ▪ Product innovation; eg social media panel, header
                                                                   bidding, digital out of home, connected TV, HyBid SDK
                                                                 ▪ Scaling technology, supply and demand position within
                                                                   programmatic, supporting migration to SaaS
Example 1: technology optimization
More cost control and efficiency through the use of state-of-the-art technology

                                                                                                   Case study:
                                                                                           Trion Worlds technology costs
                                                                                   543

                                                                                   122
                                                                                                                                               Expected

                                                                              =    421
                                                                                                                                               savings in
                                                                                                                                                 2020

                                                                                                                  174                             130

                                                                                  Sep 18                         Sep 19                         Sep 20

                                                                                           Monatliche Ausgaben
                                                                                            Monthly spending            Monatliche Leasing
                                                                                                                         Monthly tech       Kosten
                                                                                                                                      debt repayment

           Data centers:                   Use of Cloud Technology :                                  Result:
           High fixed costs                • Variable cost depending on traffic                       • Massive cost savings
           High personnel costs            • Scalable                                                 • Variable costs
           Capital-intensive investments   • Low personnel costs                                      • Reduced risk
                                           • No capital-intensive investments                         • Reduction of downtimes
Example 2: M&A case study Trion Worlds
Preference for distressed asset deals; usual pay-back in less than 24 months

             Optimization of the rentability     Optimization of a s s e t s          Organic growth
                                                                                                                                 First
                                                          Balanced
                  1    Use synergies                 1
                                                          monetization
                                                                                       1    Relaunches                     12 months
                                                                                                                               post M&A

                  2    Improve technology            2    Community Management          2   Sequels

                                                                                                                               Revenue:
                                                                                                                            19 Mio. €
                  3    Internationalize              3    Content updates
                                                                                                 INVESTMENTS IN GAMES
                                                                                                        €3.4m

                                                                                                                                EBITDA:
               Acquired for
                  €8,5m                                         INCREASE IN PROFITABILITY                                  7.2 Mio. €
             in October 2018

            Trion Assets acquired              Investment in content, sequels, advertising and                    Result: strong cashflow and
            for €8.5m in oct. 2018             Internationalization + integration into gamigo.                    substantial increase in value
                                               € 3.4 Mio. invest                                                  Payback < 24 months
Example 3: Hyper Casual Games value chain synergies
Games and media combined: optimizing the value chain

                                             Example Hyper-Casual Games

            Games               user acquisition           playing user               ad-income    Break-even -> 22.5 ad-views
             only
                                € 0.15 CPI                                            € 2 CPM
                                                        versus                                     300% better efficiency

            Games
            & Media              user acquisition          playing user               ad-income    Break-even -> 7.5 ad-views

                               € 0.10 CPI                                             € 4 CPM

                                               Hyper casual games, important:                        Result: much higher
       Huge efficiency gain between            - to acquire players as efficient as possible and
       ‘games & media’ versus ‘games                                                                 efficiency with in-house
                                               - to monetize players (via ads only) as good as       media
       only’                                     possible
Example 4: data optimization
Unified MGI group customer data platform for more efficiency

                                   Data are the ‘fuel’ of programmatic advertising:         Huge efficiency improvements are possible with:
  Targeting each person with the   - to bid for the ads that reach the right target group   - more data volume
  right ads is a challenge and     - to enrich basic data with additional info’s            - and combining data from various in-house
  decides about efficiency.        - to analyze and optimize efficiency                       sources with external data
                                                                                            - and data science know-how and AI skills
I.     Introduction
       I.     Overview MGI
       II.    Market overview
       III.   Strategy

II. Gaming
       I.     Overview
       II.    Portfolio Impressions
       III.   Community Impressions
       IV.    Review 2019 an Q1 2020
       V.     Preview 2020
III.   Media
       I.     What we do
       II.    Buy & Build
       III.   Outlook
IV.    Financials
Global gaming brands
Unified under one umbrella
Gaming at a glance
Leading publisher of free2play games in the western market

             Strong Portfolio                Active Community      Increasing revenues

            More than 25 MMO
                                            More than 5 Million
           Games distributed via                                   Run rate +50 Million
                                            Monthly Active Users
              own gaming                                             Euros revenue
                                                  (MAU)
                platforms
Portfolio Impressions
Games Portfolio
Strong variety of genres

❖ Unique MMO-Shooter in Voxel Art
❖ Player map creator enables unlimited content

❖ Generated more than 180m Euro lifetime Revenue
❖ Unique competitive and strategic gameplay

❖ MMORPG in a timeless Anime style
❖ Average Customer Lifetime above 5 years
Games Portfolio
Strong variety of genres

❖ Turn based Strategy to play in a web browser
❖ Localized in 16 different languages

❖ Above 100m Euro lifetime revenues
❖ Battlepass is challenging players on a monthly base

❖ Weekly guild wars to conquer the castle to provide the king
❖ Countless hours of gameplay content due to level cap of 185
Community Impressions
Community building
Loyal and pro active community

             Dedicated Team of
            Community Managers

                Dedicated
            Social Media Team

          Daily Game Events and on
                 Social Media
Social Media Activity

       More than 8 million                           Monthly reach of more
                             More than 350 weekly
       Followers on Social                           than 30 million users
                             posts on Social Media
             Media
Community Events

     Own Video Award   Best picture Contest   Dance Contest

       Bee Racing        Cosplay Events       Cookie Contest
Review 2019 and Q1 2020
Desert Operations: Graphic and UI Update

                         91% of New Players      Registrations        Reg2Pay
                         using new UI Design   increased by 33%   increased by 9%
Trove Expansion: Into The Deep

   19% increase of   14% increase of   15% increase of
   Paying Customer        ARPU          Net Revenues
ArcheAge: Shadows Revealed

 ❖ New Business Model
                             ❖ DAU doubled since its launch
 ❖ Major graphic refresh
                             ❖ Over 300.000 units sold of Unchained since ist
 ❖ Massive content update      launch
Game Updates in 2019/Q1 2020

  New game mode – Battle Royale   Enhanced PvP System        New Battlepass Seasons

        Brand New Maps            Updated Gear Crafting   New character class (Rock Star)
KPI Highlights 2019

                                  Accomplished
                     4.2 mio                         More than
                                      over
                      words                            1.200
                                      1.100
                    localized                    Influencer made
                                      game
               for game updates                   „Let´s Play´s“
                                  maintenances
Customer centric approach strengthen in 2019
Partnering with market leaders

                                 Group wide implementation of world leading
                                         customer support solution

                                  Increasing social media awareness by using
                                          innovative software solution

                                 Full platform integration of customer targeting
                                               communication tool
Outlook 2020
May 2020 - Trove

       Launch of the new Expansion
             „Trove – Delves“
June 2020 - ArcheAge

   Launch of the new Expansion
 „Archeage – Garden of the Gods“
Upcoming Game Updates in 2020

        New Battlepass       Level Cap raise    Level Cap raise

      New Character Class   Class Rebalancing    New Tutorial

and many more…
2020 - Further invest in growth

                           Working with
    Launching new                            Extending to new       Process
                        strong partners in
       Games                                     platforms      automation via AI
                          new territories

   Inlicensing strong   Outlicensing owned     Expanding        Increase efficiency
          IP´s                  IP´s         customer reach
I.    Introduction
      I.     Overview MGI
      II.    Market overview
      III.   Strategy
II.   Gaming
      I.     Overview
      II.    Portfolio Impressions
      III.   Community Impressions
      IV.    Review 2019 an Q1 2020
      V.     Preview 2020

III. Media
      I.     What we do
      II.    Buy & Build
      III.   Outlook
IV.   Financials
Competitive environment in the ad-tech industry
More and more advertising channels and parties. However invests in technology and less venture money lead to
market consolidation. Scale matters !
Opportunity in media
                  PAID MEDIA AND THE OPEN INTERNET        MGI Value Chain

                                                     Advertiser        Service Layer

                                                        DSP         Technology Layer

                                                       Data               Data Layer

                                                        SSP         Technology Layer

       Media and Games Invest
                                                     Consumer          Content Layer
What we do in Media
Verve Group is a data-first brand performance ad platform connecting brands, advertisers and
publishers to people in real time
                                      Full Stack Advertising                                Leadership
                                      Platform

                              Brand – Top Fortune 500 Advertisers                     Strong Executive Global Team

                              Performance – Top 500 Global Digital Brands             over 350 employees

                              Publishers – Top 100 in the App Stores                  20+ Worldwide Offices

                              Global Marketplace - in 20 Countries

                              Influencers Platform - Full and Self Service

                                                                             TECH &
                       ADVERTISER                                                                                    PUBLISHER
                                                                              DATA
VERVE GROUP: Fortune 500 Advertisers trust us
Top Game Publishers

                        OFFLINE BRANDS                     ONLINE BRANDS

           Agencies   Retail+Automotive   Brand   Gaming     Banking       Sharing Economy
VERVE GROUP: We work with top Publishers
Long term premium publisher partnerships

                 Social              Games          Entertainment        Utility

            Bigo                Easybrain          Flipboard        Meitu
            - 350M MAU          - 500M downloads   - 145M reach     - 6B+ posts/month
Ad Units
Drive revenue & engagement with support for all major ad formats

                          Native          Display         Video    Rich Media
Case Study

        RESULT:
                    590k+             166k+               $0.45             3-Day Avg.Post
                                                                            Exposure - 1st Visit
                     total visits   incremental visits       CPIV

        OBJECTIVE                                    TARGETING STRATEGY
        Drive awareness, foot-traffic & sales        • Geofenced all Burger King locations in
        for the Winter Whopperland                   • the US.
        promotional peel off game during the         • Verve Activate Custom Audiences -
        2019 Holiday Season. Prove results             Burger King Loyalists & Competitive
        with a 3rd Party Foot-Traffic Study.           QSR Loyalists.
                                                     • Recent Past Visitors of competitive
                                                       burger QSR’s.

        CREATIVE APPROACH
        Standard banners with a Tap to Map function were designed by Verve Foundry™;
        which automatically detected the user's current location and provided directions to
        the closest Burger King restaurant.
Case Study

       RESULT:         984                 518              2.3X                        2.2X
                       Trade opens         Trade opens      Higher trade opens         Higher trade opens on
                       on iOS              on Android       on iOS during peak         Android during peak
                                                            trending season            trending season

           GOAL                                                 STRATEGY

       •   Acquire high value users who will trade          •     For each publisher, the conversion funnel at each step was
           open with a minimum deposit of $200.                   analyzed i.e. registration, deposits, trade opens. Those who
                                                                  performed below the set KPIs were automatically eliminated
       •   Optimize campaign towards a CPA pricing                while high performing publishers were prioritized.
           model with trade open - i.e. when someone        •     Leveraging an increase in cryptocurrency global search trends
           opens an account and makes the minimum                 assisted in a significant scale in trade opens over a 2-month
           deposit - as the payable action.
                                                                  period.

       “Through our partnership, we were able to acquire the right type of customers according to our KPIs.
       Their dedicated support, expertise and agility in execution makes them one of our most valuable
       partners.” - Nir Smulewicz , VP Marketing at eToro
Case Study

                                                                    50% of Influencers and
        RESULT:             67                   2.4M               77% of views
                    Influencer campaigns       Views achieved       booked via adspree

        OBJECTIVE                                  STRATEGY
        • Reduce media costs in media and          • Centralize booking of Influencers
          Influencer buying                          across video and social media
                                                     channels, increasing negotiation power
        • Create cost efficient video assets                                                  Influencer booked via Adspree
          via internal production resources.       • Combine skillsets of Gamigo internal
                                                     marketing graphics team and
                                                     Mediakraft production capabilities
                                                   • Constantly expand synergies in 2020

        APPROACH
        Sharing gamigo and Adspree resources, contacts and market insights, leading to an
        ever growing Influencer database and long term partnerships
        Involving Mediakraft production teams to create compelling spots and trailers
                                                                                              Video spot created by Mediakraft
Buy & Build
MGI GROUP: Market Consolidator Media
Acquiring and Integrating Media Companies in Verve Group

                 MGI                                       Brand and
                                            Advertiser     Performance
                                                                            Service Layer

          2020

          2019                                 DSP         Demand        Technology Layer

          2019
                                              Data         DMP                 Data Layer
          2019

          2019
                                               SSP         SDK Base      Technology Layer

          2017

          2016                              Consumer       Influencer       Content Layer
Outlook
Media
How the Gaming Sector Benefits From the Media Sector and Vice Versa

Inorganic growth
▪ M&A
▪ Synergetic Businesses
▪ Cost efficiencies                         Sales
                                                                                  ▪   Sustained growth despite COVID-19

                                                                                  ▪   Intercompany synergies

                          Wider Offering   PRODUCT
                                            Product   Customers                   ▪   Seasonal effects media and advertising space

                                           Growth
                                                                  Organic growth
                                                                  ▪ More sales people
                                                                  ▪ Wider offering for the same customers
VERVE GROUP: Driving Innovation in Adtech
Example: connecting the users across all / new media

                                                                   DOOH + mobile
                                                                   Launched 2019

                                           Emerging Market Gen-Z   CTV mobile
                                                                   AdCast SDK
                                                                   launched in 2019

                                                                   VR Ads
                                                                   Launched in 2020
I.     Introduction
       I.     Overview MGI
       II.    Market overview
       III.   Strategy
II.    Gaming
       I.     Overview
       II.    Portfolio Impressions
       III.   Community Impressions
       IV.    Review 2019 an Q1 2020
       V.     Preview 2020
III.   Media
       I.     What we do
       II.    Buy & Build
       III.   Outlook

IV. Financials
Revenue and EBITDA development                                                                                                                             Adjusted
mEUR                                                                                                                                                       EBITDA margin
120                                                     CAGR+43%
                                                       CAGR  +43%
                                                                                                                                                                     95%
                                                                                                                                 Acquisitions of
100                                                                                                                              Verve              97               85%
                                                                                                         Acquisitions:
                                                                                                         • WildTangent             84                                75%
                                                                                                         • ReachHero                                                                    Historically
 80                                                                                                      • AppLift
                                                                                                         • PubNative                                                 65%
                                                                                                                                                                           ▪ M&A as growth driver for building critical
                                                                                                                                                                     55%     mass to achieve economies of scale
 60                                                                                       Acquisition of
                                                              Acquisition of              Trion Worlds
                                                               Mediakraft                                                                                            45%
                                 Acquisition of                                         42                          45
                                 Aeria Games                  39
 40                                                                                                                                                                  35%
         Acquisition of
            Looki                  21
                                                                                                                     30%
                                                                                                                                           18
                                                                                                                                                                                     Going forward
                                                                                                                                                            20       25%
        15                                                                                   25%                                        22%
 20                                     20%                                                                                                          20%
                                                                18%                                                         13                                             ▪ Organic growth will become a key growth
                                                                         7                        11                                                                 15%
                                             4                                                                                                                               driver, as acquisitions will gradually become
           10% 2                                                                                                                                                             smaller in relation to total revenue
  0                                                                                                                                                                  5%
        2014A                      2015A                     2016A                      2017A                            2018A     2019A           Q1 2020 LTM

              Revenue Gamigo                                                 Revenue MGI                                         Adjusted EBITDA* Gamigo
              Adjusted EBITDA* MGI                                           Adjusted EBITDA margin*

 * EBITDA adjusted for one time, M&A and financing costs
 * gamigo was acquired by MGI in May 2018, financial development includes gamigo pro forma figures from 2014 – 04/2018
Segment performance
                                                  FY 2019 (in kEUR)

  Net revenues                   Revenue                              EBITDA                   EBITDA
 43.132
                                                                 12.621
                 40.761

                          51%                                                          81%
                                                                                                              19%
                                                 49%

                                                                               2.921

 Gaming          Media          Gaming   Media                   Gaming        Media         Gaming   Media
Revenue by region

      Q1 2020 revenue by region                                  MGI’s Main Markets

                               2%

                          5%
                     6%

                                              36%

                   50%

      Europe   North America        South America   Asia   RoW
Diversified revenues

                                      2019 Group Revenue                         2019 Media Revenue

                         Rift*    Grand Fantasia     Shaiya*
    Aura Kingdom          2%           2%              1%
                                                                  Defiance*
         3%
                                                                     1%
                    Fiesta*
                      3%                                                                 Performance Marketing
                                                                                               (Desktop)
   Desert Operations*                                                                            10%
           4%

   Arche Age Unchained
           5%                                                                                                    Influencer Marketing
                                                                                                                         28%
                                                               Media          Performance Marketing
     ArcheAge Hiram                                                                  (mobile)
                                                               49%
           8%                                                                          32%

                    Trove*
                      8%                                                                                         SaaS
                                                                                                                 30%

                   Casual Games and
                         Other
                          14%
Games revenue split by device and region

                Games revenue                        Distribution channel                Top 10 countries by
               Q1 2020 by device                       games Q1 2020                      revenues Q1 2020

         1%                                                                         1        USA
                  10%       12%
                                                        External
                                                          12%                       2        Germany
                                                                                    3        France
                                                                                    4        UK
                                                                                    5        Canada
                                                                   Owned
                                                                    88%
                                                                                    6        Brazil
                                                                                    7        Australia
                   78%                                                                       The
                                                                                    8
                                                                                             Netherlands
                                                                                    9        Spain
     Browser       Client    Mobile    Console             Owned   External
                                                                                    10       Russia

     PC Client is the biggest vertical with                                             Top 3 countries accounts
                                                 Strong own distribution channels
      strong recurring revenues due to                                                   for 82% of the gaming
                                                      leverage profitability
     social communities in MMO Games                                                            revenues
Recurring gaming revenues for 5+ years
            Desert Operations Global                             Deutschland-Spielt                                       Fiesta Online Europe

                                            85%                                                      76%
                                                                                                                                                       63%

                                                            6%
   2%             4%           9%                                        8%           10%                      12%             11%          13%

  1 Year       1-3 Years    3-5 Years    > 5 Years      1 Year      1-3 Years      3-5 Years      > 5 Years   1 Year         1-3 Years   3-5 Years   > 5 Years

            Last Chaos North America                              Last Chaos Europe                                    Fiesta Online North America

                                                                                                 57%
                                          60%                                                                                                          58%

    19%                                               20%                                                      19%
                                                                   13%            10%                                          15%
                  10%         11%                                                                                                           9%

   1 Year       1-3 Years   3-5 Years   > 5 Years    1 Year      1-3 Years      3-5 Years      > 5 Years      1 Year         1-3 Years   3-5 Years   > 5 Years
Licensed vs owned revenue

               Increasing focus on licensed games

 70%
 60%
 50%
 40%
 30%
 20%
 10%
 0%
       Q1-19         Q2-19          Q3-19           Q4-19   Q1-20

                             Licensed       Owned

           MGI’s launch strategy to accelerate organic growth is based on licensed games like ArcheAge Unchained to avoid development risk
Consolidated balance sheet
                                                            31 Dec     31 Dec     31 Mar
EUR 000's                                                                                             Q1 2020 Highlights
                                                              2018       2019       2020

Intangible assets                                            204,142    233,207    253,466   -   Intangibles increased mainly from
Property, plant and equipment                                  4,189      3,521      4,267
                                                                                                 the acquisitions
                                                                                             -   Trade receivables increased due
Financial assets and other assets                             11,712     19,864     24,409
                                                                                                 to revenue growth, partly by M&A
Long-term assets                                            220,043    256,593    282,143
                                                                                             -   Cash position has been reduced
Trade and other receivables                                   11,803     22,872     45,606
                                                                                                 compared to 2019 due to the
Cash and cash equivalents                                     4,447      32,984     12,950       buyout of gamigo minorities and
Short-term assets                                            16,250     55,857     58,556        the Verve acquisition in Q1 2020
Total assets                                                236,293    312,449    340,699    -   Non-controlling interest
                                                                                                 decreased due to the minority
Equity attributable to shareholders of the parent company     67,220     98,068    148,511       buyout in Q1 2020
Non-controlling interest                                      91,320     70,490      2,664   -   Long-term liabilities increased
Total Equity                                                158,540    168,558    151,175        due to MGI bond issues and credit
                                                                                                 lines for M&A, the acquisition of
Long-term liabilities                                         53,395     89,347    106,857       the gamigo shares
Short-term liabilities                                        24,358     54,544     82,667   -   Short Term liabilities increased
Total liabilities and equity                                236,293    312,449    340,699        stronger than receivables due to a
                                                                                                 negative working capital and a
                                                                                                 obligation towards the former
Equity Ratio                                                    67%        54%        44%        gamigo shareholders
Consolidated cash flow statement
                      Operating cash flow                                                 Capital expenditure
    25.000                                                              30.000

                                                                                                                                               24.862
                                                              19.594    25.000
    20.000
                                                     16.200
                                                                        20.000
    15.000
                                                                        15.000                                             14.113
                                                                                                                                      13.070
    10.000
                                             6.943                      10.000
                                                                                                   6.551        6.936
                            4.394    3.801
     5.000                                                               5.000
                    1.393                                                        2.042
                                                                                         1.184
             314
        0                                                                   0
             2014    2015    2016    2017    2018    2019     Q1 2020            2014    2015      2016         2017       2018       2019     Q1 2020
                                                               LTM                                                                              LTM
                                                                                            Maintenance capex       Expansion capex

                                                                        • Free Cashflow: Despite 5 M&A Transactions and further
       • +135% increase in operating cashflow in 2019 with                investments into the games MGI generated 3.1 million free
         strong further growth in Q1 2020                                 cashflow in 2019
       • EUR 19.6 million operating cash flow In Q1 2020 and            • Expansion capex in LTM Q1 2020: The Verve M&A
         limited maintenance cashflow of EUR 4.1 million leads to         transactions as well as investments into the media
         strong cash conversion                                           platform led to an increase in Q1 2020 while also operating
                                                                          cashflow increased by EUR 3.4 million
Leverage development (2014 – Q1 2020)
     Conservative credit metrics with a net leverage of 2.1x to reported EBITDA
                                                                                                                                                                            Q1 2020 Highlights
Net interest bearing debt, EURk                                                                                 •   Tap Issue MGI                 Leverage, x
                                                                                                                    Bond (EUR 5m)
 80.000
                                                                                                                •   UniCredit Loan                              -   Net Debt increased to EUR 72mn due to
                               Net interest bearing debt                                                            (EUR 10m)            71.775                     gamigo buyout and further M&A
 70.000                                                                                                                                               26,00x
                               Net IBD / reported EBITDA                                                                                                        -   EUR 10mn UniCredit term-loan drawn
                                                                                                •   Capital Increase
                                                                                                    (EUR 9m)                                                        for minority buyout of gamigo AG
 60.000                                                                                         •   Tap Issue gamigo
                                                                                                    Bond (EUR 18m)                                              -   EUR 5mn Tap Issue of the MGI Bond
                                                                                                •   Issue of MGI Bond                                 21,00x

 50.000                                                                                             (15m EUR)
                                                                                                                                                                              2019 Highlights
                                                                                                                                                      16,00x
 40.000                                                                                   Issue of Nasdaq
                                                           Issue of
                                                                                            gamigo Bond                     34.911                              -   EUR 9mn Capital increase with Hauck &
                                                        UniCredit Loan
             Issue of German                                                                 (EUR 32m)                                                              Aufhäuser
                                                          (EUR 17m)
 30.000        bond in 2013
                (EUR 12m)                                                        25.210                                                               11,00x
                                                                                                                                                                -   EUR 15mn MGI bond issue with a
                                                            20.453                                    20.430
 20.000                                                                                                                                                             framework of EUR 25mn with ICF
                      7,0

                  10.543
                                       13.068
                                                              7,8                                                                                     6,00x     -   EUR 18mn tap issue of the gamigo bond
 10.000                                                                                                                                                             with Pareto Securities AB
                                                                                                          2,4                   2,2
                                                                                                                                           4,2
                                         3,1
                                                                                 3,6                                                                            -   EUR 12mn credit lines with UniCredit
       0                                                                                                                                              1,00x         and Commerzbank (undrawn)
                   2014                 2015                 2016                 2017                  2018                    2019   Q1 2020 LTM

1) Until December 2017: Net IBD and EBITDA gamigo Group used for calculation
1) From December 2018 MGI Net IBD and reported EBITDA used for calculation; excluding Shareholder Loans starting from 2018 ff
Outlook
COVID-19 has positive effects on MGI revenues
      Increased user activity as an effect of imposed restrictions
                                                                       Gaming
        • The pandemic and its corresponding lockdowns have boosted user engagement within video games
        • Online and mobile gaming market is growing as more people stay inside
        • People use online gaming to overcome social distancing

                                             New players*                                     MMO revenue growth*

                                               +43%                                                +50%
                                                                        Media
        • Despite the reduced demand for travel and retail advertisement, the media marketing budget of gaming media
          companies have been increased
        • Within May we saw within a few verticals like SaaS and Influencer Marketing revenue increases to levels before
          Corona

                                  MGI is perfectly positioned for strong growth in 2020 with accelerated M&A pipeline
*April compared to the average for January and February
Further execution of our buy & build growth story
Our target is to further continuing our 30+ % YoY organic and M&A growth
             Low business risk focus
             •       Further predictable M&A; long-term revenues, predictable returns, in media and games
             •       Diversified revenue streams; several sustainable long-term revenue drivers
             •       No risky and capital-intense development of new games, no gambling games

                 Focus on attractive growth segments gaming and media
                 •    Further focus on the synergetic, fast growth and good margin segments media and games
                 •    Usage of technologies; optimize and utilize technical game changers
                 •    Next to many attractive M&A targets also good opportunities for organic growth

                 Focus on synergies within and between games and media
                 •    Platform philosophy: more volume = more efficiency; use of economies of scale
                 •    Buy, Integrate, Build and Improve: concentration on increasing operational cash flows
                 •    Using the synergies between media and games segment

             Focus on financial targets
             •       Continuing to drive profitable growth, aiming at continuing 30+% YoY revenue growth
             •       But also focus on sustainability and stakeholder value
             •       Shares (MGI) and bonds (gamigo & MGI) to finance additional growth, keeping leverage at a healthy level
Thank You
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