Q3 PRESENTATION, 6 NOV 2018 - Catena Media
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Q 3 P R E S E N TAT I O N , 6 N O V 2 0 1 8
Presenters
PER HELLBERG PIA-LENA OLOFSSON
CEO GROUP CFO
2
Q3 Highlights
“It’s my belief that Catena Media’s JUL-SEP 2018 JUL-SEP 2018 JUL-SEP 2018
business, through being in the sweet
spot of the value chain, has substantial 60% 43% 50%
growth opportunities ahead.” EUR 27.7m EUR 13.6m EUR 0.15
REVENUE GROWTH ADJUSTED EBITDA EPS GROWTH
YOY GROWTH YOY YOY
Per Hellberg / CEO
3
CATENA MEDIA IN BRIEF
CATENA MEDIA PROVIDES
COMPANIES WITH HIGH-QUALITY
ONLINE LEAD GENERATION
Through strong organic growth and
strategic acquisitions, Catena Media
has, since 2012, established a leading
market position with approximately 350
employees in the US, Australia, Japan,
Serbia, the UK, Sweden, Italy and Malta
(HQ). Total sales in 2017 reached EUR
67.7m. The company is listed on Nasdaq
Stockholm, Mid Cap.
4
Our Locations
SWEDEN
LONDON - UK
SERBIA
ANDOVER - UK
JAPAN
ITALY
USA MALTA
AUSTRALIA
55
Catena Media Business Model
Potential Leads Leads Converted Leads
SEO Revenue Models:
Marketing Tool - Revenue share
- Cost per acquisition
Pay Per Click - Hybrid
Marketing Tool - Fixed
- Subscription
Potential Users B2C Catena Media’s Platform Catena Media’s Customers B2B End Users B2C
Catena Media promotes more than 1,200 brands Catena Media has currently about 1,000 online B2B Customers/Operators
Potential Leads Leads Converted Leads
SEO Revenue Models:
Marketing Tool - Revenue share
- Cost per acquisition
Pay Per Click - Fixed
Marketing Tool - Hybrid
- Subscription
Potential users B2C Catena Media’s Platform Catena Media’s Customers B2B End Users B2C
6
Executive Management
PER HELLBERG PIA-LENA OLOFSSON ANDREAS ERICSON
Chief Executive Officer Chief Financial Officer Head of Mergers & Acquisitions
ÅSA HILLSTEN JOHANNES BERGH LOUISE WENDEL
Head of Investor Relations Chief Operating Officer Head of Legal 7
Financials
Q3 2018
88
Strong quarterly revenue growth
Search revenue Paid revenue
27.7
Other operating income Subscription 26.1 0.4
23.9 0.1
3.6
20.1 3.8
Q3 2018 EUR 27.7m 3.4
17.3
YoY GROWTH +60 % 3.1
15.2 15.1 2.8
JAN–SEP EUR 77.6m
23.7
YoY GROWTH +63% 12.3
3.7 3.1 22.2
10.7 20.4
9.6 3.5 17.0
2.8
7.5 2.3 14.5
5.9 11.5
EURm 2.0 10.9
1.1 8.8
4.1
3.0 7.9
7.3
1.5 2.0 5.5
4.8
Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Q3-18
9
Revenues, Q3
110.8
EURm
SUBSCRIPTION 1%
100%
FLAT FEES 10% 67.6
CAGR
• Very strong performance in 113 %
COST PER
sports betting in the US market ACQUISITION
in September leads to a higher 40.0
portion of CPA.
39%
• Subscription revenue was new
14.9
in Q2 accounts for 1% of total
REVENUE
revenue in the third quarter. SHARE
2015 2016 2017 RUN RATE
50% Q3-18
0% REVENUES
In the period from 2015 to 2017, Catena Media increased its
REVENUE STREAMS Q3
revenue by EUR 52.7m, equalling a CAGR (compounded average
growth rate) of 113 percent.
Run rate is Q3 2018 revenues multiplied by 4.
10Growth in Search Revenue Q3 Organic Growth in Search Revenue Q3
YoY Organic growth including
EURm 63% acquisitions 27%
23.7
Organic growth including
acquisitions JAN–SEP 26%
9.2
14.5
17%
Organic growth
solely in
Catena Media
Q3 2017 GROWTH Q3 2018 Organic growth solely in Catena Media
JAN–SEP 17%
11Regulated or taxed markets, Q3
75%
of revenues come
from locally regulated
and/or taxed markets.
REGULATED AND/OR TAXED
The Swedish market is not yet regulated but is
expected to be regulated by January 2019.
12New Depositing Customers
• Number of NDCs was spiked
during Q2 due to the FIFA World Cup 140,154
Q3 2018 138,000 138,194
133,322
NDC +37 % YoY • Average NDCs value in the US
is much higher than in Europe
SUBSCRIPTIONS 1,800
• The quality in NDCs are crucial 113,258
JAN–SEP 2018 412,000 to be able to measure the value
of the lead 100,741
NDC +51% YoY
91,222
80,421
67,023
56,352
47,530
32,634
NDCs
Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018
13Adjusted EBITDA movement, Q2 2018 compared with Q3 2018
• Catena Media´s adjusted EBITDA margin has
Adjusted EBITDA%
increased from 46.4% in Q2 2018 to 49.1% in
Q3 2018.
• By using less pay-per-click we have improved
our margin. 1.3% -1.7%
3.1%
• We have some economies of scale regarding
personnel cost.
• Higher other operating expenses due to the 49.1 %
46.4 %
investments in the US. Market and Financial
Services Segment. These include content expen-
ses, professional fees and software expenses.
• The annual company event is affecting Q3 2018. Q2 2018 DIRECT PERSONNEL OTHER Q3 2018
COSTS EXPENSES OPERATING
• The margin of the quarter was impacted by a EXPENSES
one-time payment of EUR 0.5m. Adjusted EBIT-
DA-margin excl. repayment amounts to 47.2%.
14Adjusted EBITDA movement, Jan-Sep 2017 compared with Jan-Sep 2018
• Catena Media’s adjusted EBITDA margin has Adjusted EBITDA%
decreased from 52.6 percent in Jan - Sep
2017 to 49.1 percent in Jan - Sep 2018.
1.5%
• PPC costs have decreased Direct costs 1,5% -6.5%
compared to revenue to focus on maximising
the positive margin.
• Personnel costs prove economies of scale. 52.6 % 49.1 %
• Other operating expenses are higher due
to increase in professional fees and general
expenses with regards to setting up opera-
tions in the US and the Financial Services JAN–SEP DIRECT PERSONNEL OTHER JAN–SEP
segment but also expenses for GDPR and 2017 COSTS EXPENSES OPERATING 2018
compliance. EBITDA EXPENSES EBITDA
MARGIN MARGIN
15Statement of Financial Position
BALANCE SHEET AS AT 30 SEPTEMBER 2018
• Total assets amounted to EUR 354m. EURm
11.6 Other²
Other¹ 26.0
• The Group’s assets consist primarily of intangible Cash and
equivalents
10.6
assets relating to the high number of acquisitions.
149.3 Borrowings
• The Company’s liabilities consist primarily of the
EUR 149.3m bond loan, as well as EUR 65.8m in
expected earn-out commitments. 50%
can be
• Up to 50 percent of amounts committed on Intangible settled
Amounts
assets⁴ 316.9 in
acquisitions can be paid in shares if we choose 65.8 committed to
shares
to do so and thus become equity. acquisitions³
1) Other includes property, plant and equipment and trade and other receivables.
2) Other includes trade and other payables, deferred tax liabilities and current tax liabilities.
126.8 Equity
3) Includes both current (EUR 25.5m) and non-current (EUR 40.3m) commitments
4) Intangible assets primarily relate to goodwill, domains and websites, player databases and
other intellectual property.
ASSETS EQUITY AND LIABILITIES
16Funding
• Multicurrency revolving bank facility with
Swedbank
- EUR 30m
- Floating rate of Euribor 3m (with floor
of 0) +2.50%
- Matures 15 January 2021
• Senior unsecured bond with total frame work
of EUR 250m – of which EUR 150m is issued
17
17Segment Performance, Q3
REVENUE REVENUE REVENUE
iGAMING 94% FINANCIAL SERVICES 6% TOTAL 100%
Q3 2018 CASINO Q3 2018 FINANCIAL SERVICES
57% OF REVENUES 6% OF REVENUES
26.1 1.6 27.7
Q3 2018 SPORTS BETTING
37% OF REVENUES
EBITDA (ADJ.) 13.1 0.5 13.6
EBITDA MARGIN (ADJ.) 50% 32% 49%
18Financial Costs July to September 2018
JUL – SEP
EUR, MILLIONS 2018
EBITDA 13.4
EUR 13.6m EBITDA (ADJ) -> EUR 13.4m
Depreciation and amortisation -2.3
REPORTED EBITDA
EBIT 11.1
• Non-recurring costs in Q3 2018 refer to credit Interest payable on borrowings -2.1
facility costs (EUR 0.2m)
Other gains losses on bond liability +0.7
• Interest payable on borrowings is on the bond. at fair value through profit or loss
Other finance costs (notional -1.0
• Notional interest is on earn-out liability.
interest and foreign exchange)
• Depreciation and amortisation, fair value move- EBT 8.7
ment of the bond and other finance costs have
Tax -0.6
no cash flow effect.
Profit for the quarter 8.1
• EPS growth of 50%.
Earnings per share (before dilution) EUR 0.15
+50%
19UK
Potential in Legislation “Proof-of-wealth”
While the new ”proof of
SWEDEN wealth” regulation is expected
to dampen the UK market
Limited efficiency in traditional media growth, it´s nevertheless most
Limited efficiency in and availability of traditional welcome from a responsible
media channels increase the demand of digital gambling point of view.
performance-based advertising. Also, 18% tax rate
will be shared among the parties. Regulations gives advantages
Tightened regulation is
Increased demand positive for Catena Media, and
Increased demand of digital performance-based gives us a market advantage
advertising gives increased pricing and makes lead due to our strength and focus
generation attractive. on compliance.
Higher entrance barrier
More strict regulations and higher demands on
compliance make it difficult for new and upcoming ITALY
affiliates. This gives advantages to proven and large
lead generators with track record and efficient opera- Remaining position
tions advantages. GERMANY until further notice
Our position remains unchanged.
Limited Impact Business as usual We conduct business as usual
As far as we can see by new regulations in Sweden We run our German business and until further notice. Once
will have no or limited impact for Catena Media. as before, not foreseeing any law prohibits us, we will comply
change within the near future. accordingly.
20
20
20Growth Focus
21
21EUR 100m 2020
Continued double
digit organic growth
Market expansion
through own core brands
Fast growth
EUR 100m
Adjusted EBITDA
foreseen in US market
Cost efficiency
A few strategic
acquisitions
22
22In Pole Position
23
23In pole position to exploit the sweet spot of the value chain
PHASE
1. MONETISED SITES
States where Catena Media has top
ranking sites that are actively monetising
players at high CPA rates.
* 2. PRE-MONETISED SITES
States where Catena Media has sites
building traffic and search ranking
positions in preparation for regulatory
changes expected in the next 2-3 years.
These sites are currently advertising
fantasy sports, social casino, ilottery
PHASE and other approved lead generation
1. Monetizing activities
sites: 16 depending on the state.
2. Pre-monetization sites: 35
3. BUILD OUT SITES
3. Build out sites:
States20where Catena Media has
established domains and initial frame-
works for sites which are slated for
further development in coming months.
*Only Online Poker, neither online casino nor Sports Betting. 24Existing high performance Own product brands to be
US brands: launched on the US market:
BONUSSEEEKER.COM
25 25Top ranking
in New Jersey Sports Betting
Google results for “nj sports betting”
• Catena Media sites highlighted by
red border
• Results as of Oct 23, search from
US in incognito mode
26
26Strength in national US market
It´s becoming more and more clear that the US market may well be our largest market already in
2019. Fast development in increased revenue is a clear indicator. High performing sites of ours such
as PlayUSA and LegalSportsReport are organically top ranked.
Legal Online Sports Betting PA Sports Betting
Legal Sports Betting NJ Sports Betting
Online Gambling Illinois Sports Betting
Sports Gambling WV Sports Betting
*CURRENT GOOGLE POSITION NO 1 *CURRENT GOOGLE POSITION NO 1
*Results as of October 23, search from U.S. in incognito mode 27ALLBRIGHT REPORT 2018, ”GREEN LISTED”
Among Swedish listed companies,
we are among those with the most
even gender distribution.
Since 2011, the Allbright Foundation in Sweden
has evaluated gender equality at companies listed
on the Stockholm stock exchange. Catena Media
is ”green-listed” meaning that we are one of
47 companies on the Swedish stock market
with equal representation of men and women
in our management team.
We are proud of our current gender balance
within the company. Going forward, we want to
continue improving to become an even better
employer and to climb further on the list from our
current 24th position – of which we are proud.
28
28Key takeaways from the third quarter of 2018
EPS
Organically Accelerated
50% COST CONTROL
Focus
DOUBLE DIGIT
Organic Growth* NEW M&A STRATEGY REVENUES
17%
Fewer, larger and US Market revenues
more strategically growing fast
*Organic growth solely in Catena Media Jan-Sep
17%. Organic growth including acquisitions 27%.
chosen acquisitions
29Join our journey!
20 Nov 21 Nov 7 Feb 2 May
2018 2018 2019 2019
CTM CAPITAL MARKETS DAY CTM CAPITAL MARKETS DAY 2018 YEAR-END REPORT INTERIM REPORT Q1
STOCKHOLM, AT BERNS, LONDON, AT THE MAY FAIR JANUARY - MARCH
BERZELII PARK HOTEL, 53 STRATTON STREET
30You can also read
