Slide 1: 3Q 2020 Otello Corporation ASA
3Q 2020 OTELLO CORPORATION ASA
Slide 2: Disclaimer
Disclaimer This presentation contains, and is i.a. based on, forward-looking statements regarding Otello Corporation ASA and its subsidiaries. These statements are based on various assumptions made by Otello Corporation ASA, which are beyond its control and which involve known and unknown risks, unc
Slide 3: Agenda
Agenda • Executive Summary (CEO, Lars Boilesen) • Operational Review (CEO, Lars Boilesen) • Financial Review (CFO, Petter Lade) • Q&A (CEO, Lars Boilesen & CFO, Petter Lade) 3
Slide 4: Executive Summary
Executive Summary 4
Slide 5: Quarterly highlights
Quarterly highlights Financial metric (USD 3Q20 3Q19 million) Revenue 63.2 63.1 Adj. EBITDA* 5.7 6.0 Operating Cash Flow 4.2 (0.9) • AdColony and Bemobi both in line with expectations for the quarter • Revenue and Adj. EBITDA virtually flat vs last year and would have been up with like-for-like FX r
Slide 6: Operational Review
Operational Review 6
Slide 7: AdColony
AdColony • Revenue • Revenue growth YoY and QoQ, despite Covid 19 impact • Performance revenue stable last 4 quarters • Continued growth for our Brand business • Programmatic (OMP + PMP) revenue growth of over 80% in 3Q20 vs 3Q19 • Now 57% of Brand revenue • Cost • Successful merging of demand side
Slide 8: Global Brand Business
(/ ADCOLONY Global Brand "ZZ
Slide 9: Results: Brand Advertising
Results: Brand Advertising Revenue 3Q 2020 YoY Growth Source • Fourth consecutive quarter of double digit YoY growth (+20% 4Q19, +36% 1Q 20, Brand $19.9MM + 19% (incl. IO and +14% 2Q20) PMP) • Continued efforts to become a programmatic- first platform driving PMP and Open Brand Exchange Marketplace
Slide 10: North America Brand
North America Brand Revenue 2019 vs 2020 (Millions USD) • Finished 3Q20 up 10% YoY despite COVID $25,0 $23,8 still impacting brand business potential $21,6 • Primary source of growth was programmatic $20,0 both PMP and Open Exchange as buyers leaning towards more efficient buying models $15,0 • 3Q20
Slide 11: EMEA & LATAM Brand
EMEA & LATAM Brand Revenue 2019 vs 2020 (Millions USD) 3Q 2020 Sales Breakdown by Product $12,0 $11,2 1% $10,0 $8,0 $7,6 41% $6,0 $4,0 58% $2,0 $0,0 Overall 3Q19 3Q20 Instant Play LinkedIn Spotify • EMEA & LATAM markets continue to grow at rapid pace • 47% YoY growth driven primarily by a 150% YoY i
Slide 12: APAC Brand
APAC Brand Revenue 2019 vs 2020 (Millions USD) $4,0 • 17% YoY growth throughout Asia $3,5 $3,4 at a time when many countries in the $2,9 region are still facing challenges due $3,0 to COVID $2,5 • Programmatic represented 53% of $2,0 APAC’s overall revenue in 3Q20 a 20% increase compared to 3Q19 $1,
Slide 13: Programmatic Results
(/ ADCOLONY Programmatic “ZZ
Slide 14: Results: Programmatic
Results: Programmatic • 5th consecutive quarter of strong YoY growth Revenue 3Q 2020 YoY Growth Source • Private Marketplace business was one of the hardest hit with COVID pauses and cancellations in Q2 Programmatic Open $15.1MM + 91% and began showing a resurgence in Marketplace Q3 validated by 112
Slide 15: Global Publishing & Performance Business
Global Publishing & Performance Business
Slide 16: Results: Performance Advertising
Results: Performance Advertising Performance Revenues 3Q19 4Q20 1Q20 2Q20 3Q20 $16,0 $15,9 $14,0 $13,9 • Performance revenue stabilizing $12,0 $12,8 $13,3 $13,3 after several quarters of consistent decline $10,0 • Increased focus in process $8,0 realignment and tooling to bring us $6,0 back to growt
Slide 17: Bemobi
Bemobi 17
Slide 18: Bemobi's two pillars for sustainable profitable growth
Bemobi’s two pillars for sustainable profitable growth in emerging markets makes us unique Illustration of growth in number of subscribers APPSCLUB SERVICES Compelling subscription services with best of Growth comes from combining multiple breed apps & games priced for each emerging ADDRESSABLE USER
Slide 19: Bemobi's key subscription service offerings
Bemobi’s key subscription service offerings SUBSCRIPTION SERVICES 1 APPSCLUB FAMILY 2 STANDALONE 3 VOICE & FINANCIAL SERVICES SUBSCRIPTION APPS Bundles of top apps & games in a low Distribution of standalone subscription Market-leading on Voice price point subscription model apps Messaging provider
Slide 20: Bemobi's distribution channels
Bemobi’s distribution channels DISTRIBUTION CHANNELS 1 MOBILE CARRIERS PROMOTIONS 2 PAID ONLINE CAMPAIGNS 3 CO-OWNED CHANNELS WITH MOBILE CARRIERS When a deal is signed, the mobile Partnering with leading apps and web Bemobi’s turnkey platform for mobile carrier commits to doing marketing properties
Slide 21: Revenue & Adj. EBITDA
Revenue & Adj. EBITDA • Negative impact from FX and Covid-19 • Outperformed our peers during Covid-19 ∆ (%) Bemobi 3Q20 3Q19 Y-o-Y Revenue (USD M) 11,6 14,8 -21% EBITDA (USD M) 4,7 6,2 -24% ∆ (%) Bemobi - Ex-FX Rate 3Q20 3Q19 Y-o-Y Revenue (USD M) 14,5 14,8 -2% EBITDA (USD M) 6,1 6,2 -1% FX Rate imp
Slide 22: Bemobi – Subscriber growth driving revenue and scale
Bemobi – Subscriber growth driving revenue and scale • Total # subscribers up 6.8 million vs 3Q19 • YoY LATAM up 5.6 million including Voice 40,0 4,0% (IVR) and financial services subscribers 35,0 3,6% 34,6 34,6 • YoY International up 1.1 million (11%) due 30,0 3,2% 3,0% to global rollout of new pro
Slide 23: Bemobi - Overall channel mix improving
Bemobi - Overall channel mix improving International markets continue subscriber growth Co-owned Channels 3Q19 vs. 3Q20 (from 9.6M to 10.7M) NDNC CHANNEL FROM TO Comments • 16 portals live in Bemobi outside of Latam: • Idea India Bemobi1 (co- 34% 34% Stable % contribution despite the • Banglalink Ba
Slide 24: Bemobi
Bemobi • New voice-based channels and omnichannel platform with good traction in Brazil and about to begin international rollout, however delayed by about two quarters • New voice and financial services offers growing in Brazil and show potential for an international rollout in the future. Two new c
Slide 25: Other topics: Bemobi IPO and COVID-19
Other topics: Bemobi IPO and COVID-19 • Bemobi has made a preliminary filing for a listing in Brazil. • The preliminary filing consists of draft documentation which will be subject to review by the Brazilian Securities Commission (the "CVM"). The filing does not mean that a listing of Bemobi will de
Slide 26: Opera TV (Vewd)
Opera TV (Vewd) • As previously communicated, there is an ongoing legal dispute with majority shareholder (MFC) • Favorable verdict granted on liability, not appealed by MFC • MFC ordered by the Court to pay a substantial portion of Otello’s legal costs to date, all cash received • Otello has now re
Slide 27: Financial Review
Financial Review 27
Slide 28: Otello Corporation 3Q20
Otello Corporation 3Q20 (USD million) 3Q 2020 3Q 2019 % Change Revenue growth in AdColony offset Revenue 63.2 63.1 0% by revenue decline in Bemobi Publisher and revenue share cost (38.9) (35.9) 8% Payroll and related expenses (10.7) (12.8) -16% Total operating expenses down 3% Stock-based compensati
Slide 29: Otello Corporation 3Q20
Otello Corporation 3Q20 Revenue (USD million) OPEX (USD million) Revenue growth in AdColony 70,0 offset by revenue decline in 21,2 21,0 20,9 63,2 63,1 18,6 18,1 Bemobi 55,7 54,0 OPEX down 12% due to lower payroll expenses • Positive FX impact for 3Q19 4Q19 1Q20 2Q20 3Q20 3Q19 4Q19 1Q20 2Q20 3Q20 Bem
Slide 30: AdColony
AdColony • Revenue in line with expectations in Revenue USD million) 3Q20, very strong Programmatic OPEX (USD million) 55 revenue 52 48 12 Brand - 43 43 8 15 Programmatic • Performance business stable last 4 9 15,9 15,8 15,8 7 10 12 3 Brand - quarters 14,4 13,7 5 5 Performance 17 22 20 Brand - Manag
Slide 31: Bemobi
Bemobi Revenue (USD million) OPEX (USD million) 14,5 4,4 • Reported revenue and Adj EBIDTA would have been 14,9 14,8 respectively down 2% and 1% 4,1 4,1 3,8 13,0 3,3 3,3 YoY with neutral FX rates 11,6 10,7 • As COVID19 lockdown 3Q19 4Q19 1Q20 2Q20 3Q20 3Q19 4Q19 1Q20 2Q20 3Q20 measurements gradually
Slide 32: Cash flow
Cash flow Cash flow (USD million) • Operating cash flow: USD 4.2 million • Positively impacted by positive Adj. EBITDA 4.2 (3.5) and good cash collection (0.8) (0.1) • Cash flow from Investment: USD (3.5) million • Capitalized R&D: USD (2.6) million • CAPEX: USD (0.8) million • Cash flow from Financ
Slide 33: Financial position
Financial position Financial Position (USD million) Balance sheet (USD million) 33,1 Other assets 77,7 33,1 Cash Accounts 65,8 299,6 3,1 Equity receivables Goodwill 216,8 -30 93,7 Liabilities Gross Cash Gross Debt Net Cash 33
Slide 34: Outlook AdColony
Outlook AdColony 4Q20* 2020** Revenue: Up 10-15% Revenue: Up ~10% Gross margin: Down Gross margin: Down OPEX: Down OPEX: Down Adj. EBITDA: Up Adj. EBITDA: Up *Vs 4Q19 **Vs 2019 34
Slide 35: Outlook Bemobi
Outlook Bemobi • Not able to provide forward-looking statements due to IPO filing 35
Slide 36: Q&A
Q&A 36