Next 15 Group Plc · LSE:NFG
Next 15 — Q4 2024 Earnings Presentation
24 slides from Next 15's earnings presentation, Apr 16, 2024
Slide 1: Preliminary Results - April 2024
NEXT15 PRELIMINARY RESULTS - APRIL 2024 NEXT15
Slide 2: Agenda
AGENDA FY24 results summary Financials in detail Capital allocation priorities Operational progress Outlook 2 NEXT15
Slide 3: The Results
THE RESULTS Net revenue up 2.5% (up Revenues and profitability in line with expectations despite 0.3% organically) to specific weakness in tech £578m (2023: £564m) Tech revenues declined by £36m (17%) on a like for like basis and Currency impact of (£6m) now accounts for approximately 30% of Group rev
Slide 4: The Results
THE RESULTS Adjusted diluted EPS up Strong cash generation despite changing profile of customer-base to 81.6p (2023: 80.4p) $50m reduction in Mach49 earn-out Net debt as at 31 Jan Decentralized model has enabled us to adapt quickly to market 2024 £1.4m (2023: net fluctuations cash of £26.1m) ‘Brand to
Slide 5: Financials in Detail
FINANCIALS IN DETAIL PRELIM RESULTS : APRIL 2024 5 NEXT15
Slide 6: Adjusted P&L
ADJUSTED P&L £M 2024 2023 GROWTH % Net revenue 577.8 563.8 2.5% Organic revenue growth 0.3% 20.7% Operating profit 121.1 114.2 6.1% Operating margin 21.0% 20.2% Profit before tax 117.9 112.5 4.8% Tax (31.1) (26.3) Minorities (1.0) (1.4) Profit after tax 85.8 84.8 Diluted EPS (p) 81.6 80.4 1.5% Total di
Slide 7: Revenue Bridge
REVENUE BRIDGE 69.7 39.8 (1.1)% 3.3% 0.3% Revenues £m NEXT15
Slide 8: Segmental
SEGMENTAL Net revenue Operating Organic Margin Margin Operation 2024 Profit growth 2024 2023 £M £M Customer Insight 57.4 4.3% 10.3 18.0% 21.3% Customer Engage 263.1 (6.3%) 53.2 20.2% 20.2% Customer Delivery 107.7 5.1% 29.1 27.0% 29.6% Business Transformation 149.6 8.7% 48.3 32.3% 32.5% Head Office - -
Slide 9: Cash Flow
CASH FLOW £M 2024 2023 Inflow from operating activities 115.7 119.6 Working capital (10.7) (24.4) Net inflow from operations 105.0 95.2 Tax (25.4) (20.3) Net capex (7.2) (7.0) Acquisitions (60.2) (97.5) Net interest and dividends paid (18.0) (14.8) Net proceeds from share placing - 48.6 Acquisition of
Slide 10: Forecast Earn-out Cash Payments
FORECAST EARN-OUT CASH PAYMENTS 31 Jan 2024 31 Jan 2023 £M £M FY 2024 - 45.4 FY 2025 58.7 62.8 FY 2026 46.4 48.5 FY 2027 43.6 47.7 FY 2028 28.6 39.4 Total 177.3 243.8 10 NEXT15
Slide 11: Adjustments
ADJUSTMENTS £M 2024 2023 Adjusted profit before tax 117.9 112.5 Costs associated with the current period restructure (5.1) (2.3) Property impairment - (4.7) Deal costs (0.7) (5.5) Charge for one-off employee incentive schemes (6.6) (0.6) Acquisition accounting related costs (24.6) (89.3) RCF fees wri
Slide 12: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES Continue to prioritise investment in internal capabilities – particularly data and AI Strategic acquisition strategy unchanged – do not expect large scale opportunities in the near term Disciplined approach to bolt-on M&A to enhance key business areas – at the right pri
Slide 13: Operational Progress
OPERATIONAL PROGRESS 13 NEXT15
Slide 14: Clients: Analysis
CLIENTS: ANALYSIS CLIENT WINS: CLIENTS ABOVE $1M - 111 Some of the major customers that have worked with Next 15 businesses for more than 5 years: 14 NEXT15
Slide 15: Acquisition Strategy and Progress
ACQUISITION STRATEGY AND PROGRESS Studio La Plage (post year end) Continue to make bolt-on acquisitions for our businesses at attractive multiples; multiple range Explorer of 4.8 - 7x for acquisitions in the year Williams Bolt-on acquisitions in year enhance offering of Rush the acquiring brand and
Slide 16: AI Progress
AI PROGRESS Coordinated group-wide programme of training, support, collaboration and innovation 100% 3 Significant Next 15 Labs of our brands have businesses have efficiency/productivity gains This was launched to look rolled out AI-powered AI-powered subscription seen in early applications of beyond b
Slide 17: Next Labs - Maistro
NEXT 15 LABS - MAISTRO “” Practitioner expertise Optimise client ROI Over time, we anticipate that Real-time news, analytics our use of AI has the potential and client context Augment (almost) every role in Next 15 to augment virtually every job, as well as impact our Margin improvement workforce co
Slide 18: Mega Trends
MEGA TRENDS Connected Customer Experience will drive future growth: B2B will see far greater adoption of eCommerce and CX Social commerce will continue to see huge expansion AI will reshape the way we live, learn, work and play through: Hyper personalization (customer experience, learning, gaming et
Slide 19: ESG
ESG Continued progress on B Corp certification for our brands Archetype UK and US B Corp certified in FY24; other brands well advanced in the certification process Letter of commitment on SBTi submitted in January 2024 Inclusion of employee Net Promoter Score (“eNPS”) metric in Executive remuneration t
Slide 20: Outlook
OUTLOOK Confident in meeting expectations for the full year Performance continues to be robust across all four segments Strong balance sheet provides scope for further investment in AI and M&A 20 NEXT15
Slide 21: Appendices
APPENDICES NEXT15 NEXT15
Slide 22: Next15 Board
NEXT15 BOARD Penny Robyn Perriss Helen Hunter Dianna Jones Paul Butler Ladkin-Brand (Audit) (Rem) (ESG) (ESG) (Chair) Governance Data Insight B Corp Business Pricing Transformation Tim Dyson Peter Harris Jonathan Peachey (CEO) (CFO) (COO) 22 NEXT15
Slide 23: Regional
REGIONAL Operation Net revenue Organic Operating Margin Margin 2024 growth Profit 2024 2023 £M £M US 294.0 0.9% 91.1 31.0% 31.9% UK 254.3 (0.4%) 45.7 18.0% 17.6% APAC 17.1 (3.6%) 1.7 9.9% 9.9% EMEA 12.4 6.1% 2.4 18.9% 24.3% HEAD OFFICE - - (19.8) - - Total 577.8 0.3% 121.1 21.0% 20.2% 23 NEXT15
Slide 24: Balance Sheet Summary
BALANCE SHEET SUMMARY £M 31 January 2024 31 January 2023 Intangible assets 279.3 274.1 Non-current assets 98.5 108.0 Current assets 213.8 212.3 Non-current liabilities (197.0) (241.0) Current liabilities (238.4) (239.0) Net assets 156.2 114.4 Share capital 2.5 2.5 Reserves 153.5 111.4 Minorities 0.2