Modern Times Group Mtg Ab Class A · OMXSTO:MTG_A
Modern Times Group Mtg Ab Class A — Q4 2017 Earnings Presentation
36 slides from Modern Times Group Mtg Ab Class A's earnings presentation, Feb 1, 2018
Slide 1: Shaping the future of entertainment
Shaping the future of entertainment 1 February 2018
Slide 2: Important notice
Important notice This presentation, including any oral presentation and any question and answer session based on this presentation (the “Announcement Presentation”), has been prepared solely for informational purposes by TDC A/S (“TDC”) and Modern Times Group MTG AB (publ.) (“MTG”). By reading or ot
Slide 3: Why we are here
Why we are here Q4 results Background Combination with TDC Group New MTG 3
Slide 4: Today's presenters
Today’s presenters Jørgen Madsen Lindemann Maria Redin President & Chief Executive Officer Chief Financial Officer Our Content 4
Slide 5: Q4 Highlights
Q4 Highlights Nordic & International Board proposes 10% organic sales growth SEK 12.50 dividend per Entertainment businesses 71% MTGx organic & 14% profit growth share for 2017 up against tough comps sales growth & first (incl. SEK 103m of M&A but both reported higher quarterly profit = SEK 837m in
Slide 6: Q4 sales & EBIT by division
Q4 sales & EBIT by division Sales (SEKm) EBIT before IAC (SEKm) 5 500 600 500 5 000 400 4 500 300 5 378 478 200 418 4 000 4 297 100 3 500 0 Q4’16 NE IE Studios MTGx Q4’17 Q4’16 NE IE Studios MTGx HQ & Q4’17 Elim. MTGx EBIT includes SEK 60m in write-downs and HQ & Eliminations includes approximately
Slide 7: Transformation is in our DNA
Transformation is in our DNA NEW 1987 2018 Q4 results Background Our Group Combination with TDC Content New MTG 7
Slide 8: And we have accelerated
And we have accelerated Kongregate Baltics Engage Sports InnoGames Hungary Czech Rep. Media Turtle Acquisitions ESEA Russia Disposals Africa Zitius & Splay DreamHack Ukraine Sappa Zoomin Trace Q4 results Background Our Group Combination with TDC Content New MTG 8
Slide 9: And now take the next step
And now take the next step Europe’s first fully convergent media & communications A pure play in digital provider entertainment Q4 results Background Our Group Combination with TDC Content New MTG 9
Slide 10: First of its kind combination
First of its kind combination Sweden Pay TV Streaming Norway Pay TV Streaming Free TV Streaming Free TV Streaming Radio TV, BB Business Triple Play Radio Finland Pay TV Streaming Denmark Free TV Streaming Mobile, Pay TV Streaming TV, BB Free TV Streaming MTG Studios Business Wholesale Q4 results Bac
Slide 11: A scale Nordic player
A scale Nordic player 2017 figures Revenue (DKKm) 20,270 10,293 30,563 Revenue Growth (4%) 6% (1%) EBITDA (DKKm) 8,244 1,344 9,588 EBITDA margin 41% 13% 31% EBITDA-CAPEX (DKKm) 3,756 1,230 4,986 Cash Conversion 46% 92% 52% People 8,097 1,768 9,865 Source: Source: TDC Group and MTG Note: DKK:SEK FX r
Slide 12: Present across the entire value chain
Present across the entire value chain Content production Content rights Broadcasting Streaming TV distribution Broadband Mobile Q4 results Background Our Group Combination with TDC Content New MTG 12
Slide 13: Pan-Nordic reach & market position
Pan-Nordic reach & market position 2.8m 3.1m 2.1m 1.5m TV subs Mobile Voice subs Streaming subs Broadband subs Ability to reach all 10 million Nordic households on high quality networks Why we are Q4 doing this results Best ofBackground both worlds Consumer Combination Our Group TDC Content withbene
Slide 14: Customer benefits
Customer benefits Single source More choice Flexibility Personalised for communications due to broader to create unique offering based on & content service offering products consumer insight Q4 results Background Our Group Combination with TDC Content New MTG 14
Slide 15: Compelling strategic rationale
Compelling strategic rationale Combination of two highly • Excellent content offering & scale 1 complementary entertainment companies • Pan-Nordic reach & market position • Best-in-class tech capabilities and consumer insight Providing attractive consumer • Next generation entertainment services 2 p
Slide 16: Transaction overview
Transaction overview Transaction structure Ownership of the combined entity Post distribution of TDC Group shares to MTG shareholders 309m new TDC Group shares + SEK 3.3bn in cash MTG Group TDC Group Shareholders Shareholders [x]% 28% [x]% 72% Contribution of 100% New Company shares of MTG Nordics w
Slide 17: Shaping the future of Our Content
Shaping the future of Our Content 17
Slide 18: New MTG
“New MTG” Esports Gaming Digital Video Content Other holdings Venture Capital fund Q4 results Background Our Group Combination with TDC Content New MTG 18
Slide 19: New MTG: what we are, do and add
“New MTG” What we… … ARE … DO … ADD • 8 majority owned portfolio • We are the preferred partner in • Our highly experienced companies with combined 2017 Europe for digital entertainment executive team adds strategic, sales of SEK 4.2bn – up 70% companies around the world commercial & operating value
Slide 20: Esports
Esports
Slide 21: The fastest growing sport in the world
The fastest growing sport in the world 32% 2020 CAGR 1,488 USDm Sponsorships 2018 Media rights 941 USDm 9% 23% Advertising 2016 493 USDm 13% Merchandise & tickets 17% Game publisher fees 11% 9% 9% 20% 9% 44% 41% 15% 34 20% 26% % Source: NewZoo – 2017 Global Esports Market Report Q4 results Backgroun
Slide 22: And our brands are shaping the industry
And our brands are shaping the industry • 100% owned • 75% owned • Grass-roots LAN parties & festivals • The world’s leading esports company and • Focus on interaction & gaming the category brand leader • Building high engagement levels • League operator, stadium events organiser and content produce
Slide 23: From Amateur to Pro across all relevant games
From Amateur to Pro across all relevant games LEGENDARY The world’s best VIEWING PRO Esports champions AMATEUR Prove your skill PARTICIPATION CASUAL Good luck and have fun All games All levels All platforms Global presence Q4 results Background Our Group Combination with TDC Content New MTG 23
Slide 24: Gaming
ae W ars) | Gaming
Slide 25: A huge global market
A huge global market Global Gaming Market (USDbn) Key Growth Drivers 6% CAGR CAGR 2016-2020E 129 More players 101 69 12% Mobile & 44 More paying Browser players 3% Console 32 36 PC 25 24 0% Higher spend per player 2016 2020E Source: Newzoo; OC&C Analysis Q4 results Background Our Group Combination w
Slide 26: And we have proven developer publishers
And we have 2 proven developer publishers • 100% owned • 51% owned • Proprietary publishing platform with more than 100,000 live games • Cross-platform games developer with six successful titles in mid-core strategy segment • Expanding into 1st party games development with several bolt-on acquisitio
Slide 27: Digital Video Content
Digital Video Content
Slide 28: Well positioned to capitalise on global audiences
Well positioned to capitalise on global audiences Global online video advertising market (USDbn) 25% CAGR 40 34 28 23 18 13 2015 2016 2017 2018 2019 2020 Q4 results Background Our Group Combination with TDC Content New MTG 28
Slide 29: Helping Brands engage with Millennials & GenZ
Helping Brands engage with Millennials & GenZ • Access to the best Influencers and Creators Influencers & Creators • Influencer marketing campaigns connecting & engaging fans • Authentic communication for Brands and Marketers • Developing & producing premium digital video content for Premium Content
Slide 30: Other holdings
Other holdings • SEK 1.2bn revenue media group • 6% sales growth in 2017 with double digit profit margin 95% of Bulgaria’s #1 media group • Owner of 7 TV channels & 19 online businesses • Founding shareholder in first of its kind annual global boxing tournament of Comosa AG – owner of World Boxing 1
Slide 31: A Global footprint
A Global footprint Stockholm Stockholm Hamburg London Stockholm Amsterdam Berlin San Francisco Cologne Mexico City Mumbai Q4 results Background Our Group Combination with TDC Content New MTG 31
Slide 32: Businesses builders
Businesses builders Proven record of building companies Unique entrepreneurial culture Experienced value-oriented team Operational engagement & value-add Global networking capability Strategic long-term owner Flexible investment sizes & structures Q4 results Background Our Group Combination with TDC
Slide 33: Hyper growth story
Hyper growth story Revenue break-down (SEKm) SEKm 2017 2017PF1 Total Net Sales 4192 4933 1 229 o/w MTGx 2964 3705 1 229 o/w International Entertainment 1189 1189 1 975 o/w Central operations & eliminations 40 40 1 234 1 145 360 360 Total operating income (before IAC) -344 -299 314 o/w MTGx -170 -125
Slide 34: Financial position
Financial position (SEKbn) Net cash / (debt) -1.8 • TDC Group to pay SEK 3.3bn in cash to MTG at closing as at 31 Dec 2017 • MTG Board proposes SEK 12.50 annual cash dividend TDC Group consideration 3.3 • Ongoing portfolio realignment to yield further cash inflow TDC Group dividend 0,4 • A combined
Slide 35: Summary
Summary MTG Nordic Entertainment & Studios to Creation of Europe’s first fully convergent media & 1 combine with TDC Group communications provider MTG to receive cash & MTG shareholders to receive shares in MTG shareholders will take part in the 2 TDC Group at fixed exchange ratio, with synergies to
Slide 36: Just the beginning
Just the beginning Europe’s first fully convergent media & A pure play in digital communications provider entertainment Q4 results Background Our Group Combination with TDC Content New MTG 36
Modern Times Group MTG — Q4 2017 Earnings Presentation on 6ix