Slide 1: Management Presentation First Quarter 2014 Results
April 24, 2014 Management Presentation First Quarter 2014 Results
Slide 2: Forward Looking Statements & Other Information
2 FORWARD LOOKING STATEMENTS & OTHER INFORMATION This presentation, including our “ 2014 Financial Outlook”, contains forward - looking statements . The Company’s representatives may also make forward - looking statements orally from time to time . Statements in this presentation that are not histor
Slide 3: Summary
3 • Strong start to our fiscal 2014 • Results ahead of internal expectations across all key metrics • Industry - leading organic revenue growth • Strong EBITDA, operating leverage, and free cash flow growth • $24.4 million of net annualized new business revenue; robust pipeline • Significant advance
Slide 4: First Quarter 2014 Financial Highlights
4 • Organic revenue growth of 8.3%, leading the industry • Revenue increased to $292.6 million from $265.6 million, up 10.1% • EBITDA increased to $36.4 million from $30.8 million, up 18.1% • EBITDA margin expanded to 12.5% from 11.6%, up 90 basis points • Net new business wins of $24.4 million • Fr
Slide 5: Consolidated Revenue and Earnings
5 Note: Actuals may not foot due to rounding CONSOLIDATED REVENUE AND EARNINGS (US$ in millions, except percentages) 2014 2013 Revenue 292.6$ 265.6$ 10.1 % Operating Expenses Cost of services sold 191.7 177.9 7.8 % Office and general expenses 78.2 67.4 16.1 % Depreciation and amortization 11.3 9.5 1
Slide 6: Summary of Segment Results - Revenue
6 • Q1 2014 revenue of $292.6 million represents 10.1% YoY growth • Growth driven by strength broadly across disciplines including Advertising, Media, Strategic Communications & PR, Insights, Design, and International SUMMARY OF SEGMENT RESULTS - REVENUE Note: Actuals may not foot due to rounding (U
Slide 7: Organic Revenue Growth by Segment
7 Note: Actuals may not foot due to rounding ORGANIC REVENUE GROWTH BY SEGMENT Note: Actuals may not foot due to rounding • Strategic Marketing Services continues to deliver exceptional organic growth, increasing 12.8% in the quarter, on top of double - digit growth last year • Performance Marketing
Slide 8: First Quarter Revenue by Client Industry
8 Q1 2014 Mix Year - over - Year Growth by Category • Financials, Healthcare, Retail, and Technology are our fastest growing sectors • Our top 10 clients declined to 25.5% of revenue in Q1 2014 from 28.3% a year ago, demonstrating the ongoing diversification of the business (largest <5%) FIRST QUART
Slide 9: Organic Growth Highlights Sustained Market Share Gains
9 ORGANIC GROWTH HIGHLIGHTS SUSTAINED MARKET SHARE GAINS Note: Peers include Omnicom, IPG, WPP, Havas and Publicis . WPP and Havas have not yet reported 1Q 2014 results and therefore are not included in the peer aggregate for the most recent quarter.
Slide 10: Summary of Segment Results - EBITDA
10 Note: Actuals may not foot due to rounding • We remain focused on optimizing profitability in addition to benefitting from our highest margin businesses delivering above average growth SUMMARY OF SEGMENT RESULTS - EBITDA (US$ in millions, except percentages) 2014 2013 EBITDA Strategic Marketing S
Slide 11: Free Cash Flow
11 Note: Actuals may not foot due to rounding FREE CASH FLOW (1) Capital Expenditures, net represents capital expenditures net of landlord reimbursements . (2) Cash Interest, net & Other represents the quarterly accrual of cash interest under our Senior Notes . (3) Free Cash Flow is a non - GAAP mea
Slide 12: Available Liquidity
12 AVAILABLE LIQUIDITY (US$ in millions) December 31, 2013 March 31, 2014 Commitment Under Facility $225.0 $225.0 Drawn - 32.3 Undrawn Letters of Credit 4.9 5.1 Funds Available Under Facility $220.1 $187.6 Total Cash & Cash Equivalents 102.0 17.5 Liquidity $322.1 $205.1
Slide 13: 2014 Financial Outlook
13 • We are raising our full year outlook based on the strong start to the year and the solid momentum broadly across the portfolio by our partner firms 2014 FINANCIAL OUTLOOK Note: See appendix for definitions of non - GAAP measures Initial Revised Implied 2013 2014 2014 Year over Year Actuals Guid
Slide 14: Appendix
14 APPENDIX
Slide 15: Temporal Put Obligations and Impact on EBITDA
15 TEMPORAL PUT OBLIGATIONS AND IMPACT ON EBITDA Incremental (US$ in millions) Cash Stock Total EBITDA in Period 2014 1.8 0.3 2.1 1.7 2015 3.7 0.3 4.0 1.9 2016 3.7 0.4 4.1 0.1 2017 4.1 0.0 4.1 0.9 Thereafter 2.1 0.0 2.1 0.0 Total $15.4 $1.0 $16.4 $4.6 Effective Multiple 3.6x Estimated Put Impact at
Slide 16: Summary of Cash Flow
16 Note: Actuals may not foot due to rounding SUMMARY OF CASH FLOW Note: Actuals may not foot due to rounding (US$ in millions) 2014 2013 Cash flows used in continuing operating activities ($39.2) ($31.5) Discontinued operations (0.1) (1.5) Net cash used in operating activities ($39.3) ($33.0) Cash
Slide 17: Definition of Non-GAAP Measures
17 Note: Actuals may not foot due to rounding DEFINITION OF NON - GAAP MEASURES EBITDA: EBITDA is a non - GAAP measure, that represents operating profit plus depreciation and amortization, stock - based compensation, acquisition deal costs, deferred acquisition consideration adjustments, and profit
Slide 18: MDC Partners Innovation Centre
MDC Partners Innovation Centre 745 Fifth Avenue, Floor 19 New York, NY 10151 646 - 429 - 1800 www.mdc - partners.com