Mission Group Public Limited Company · LSE:TMG
Mission Group Public — Mission Group — FY2020 Earnings Presentation
29 slides from Mission Group Public's earnings presentation, Sep 8, 2021
Slide 1: 2020 Results
2020 RESULTS Annual Results for the year ending 31st December 2020
Slide 2: A Personal View
A PERSONAL VIEW 2020 WAS … UNFORSEEN. CHALLENGING. ALL ENCOMPASSING. RELENTLESS. EXHAUSTING. HUMBLING. EMPOWERING. RE-INVIGORATING. COLLABORATIVE.
Slide 3: What It Taught Us: Doubling-Down
WHAT IT TAUGHT US DOUBLING-DOWN • We remain committed to building a Group of Collective Specialists. Inter-reliant Agencies that deliver high margins by being at the forefront of their sector. We do this through operating cost management, increased utilisation of technology and ongoing capability as
Slide 4: Contents
CONTENTS 1. 2. 3. 2020 Financial Business Summary Review Review & Outlook
Slide 5: 1. 2020 Summary
1. 2020 SUMMARY A year like no other
Slide 6: Highlights - Financial
HIGHLIGHTS - FINANCIAL Robust COVID-19 performance impact most Cash H2 margins management with full year severe in Q2 bounced back strong: net profit ahead of with sequential to a creditable debt £1m, an market recovery in Q3 11.5% historic low expectations and Q4
Slide 7: Highlights - Business
HIGHLIGHTS - BUSINESS Continued Strong Client Enhanced Central guidance MarTech retention remained MISSION and Agency First innovation, with significant Advantage with culture ensured industry leading cross-sell Alive, MISSION swift, agile but tailored and ESG approach and improvement and Made and a
Slide 8: 2. Financial Review
2. FINANCIAL REVIEW Cash is King
Slide 9: Profit & Loss (£'M)
PROFIT & LOSS (£’M) 2020 2019 • Strong H2 bounce back • H2 result £5m+ improved on H1 Billings 121.9 171.1 • Client retention statistics remained strong: • 50%+ from Clients of 5 yrs or more REVENUE 61.5 81.0 • 30% from 10+ yrs • 16% from 20+ yrs Operating expenses (59.6) (70.2) HEADLINE OPERATING P
Slide 10: Balance Sheet
BALANCE SHEET 2020 2019 • Working capital reduction includes Intangibles 96.2 95.9 c£3m VAT deferral from Govt Fixed assets/investments 2.7 3.4 support scheme, now repaid Working capital 2.2 8.6 • Earn-outs partly rescheduled due to COVID-19. Most fall due in 2021 Net bank debt (1.2) (4.9) Earn-out
Slide 11: Cash Flow (£'M)
CASH FLOW (£’M) 2020 2019 Headline operating profit 1.9 10.8 Add back depreciation 4.3 4.0 • Tax payments much reduced due to Less lease payments (2.8) (2.6) lower forecast profits EBITDA 3.5 12.2 • Working capital benefited from strong Client prepayments and good cash Interest and tax (1.4) (2.4) m
Slide 12: 3. Business Review & Outlook
3. BUSINESS REVIEW & OUTLOOK Bouncebackability!
Slide 13: 2020 Revenue
2020 REVENUE Impact (vs 2019) Q1 Q2 Q3 Q4 -11% -19% -26% -39%
Slide 14: 2020 Contribution to Profit (vs 2019)
2020 CONTRIBUTION TO PROFIT (vs 2019) As a collective we had Agencies with differing fortunes (BEST AND WORST) 40% 20% 17% 8% 12% 0% H1 H2 Total -20% -40% -60% -65% -73% -80% -84% -100% Property Technology
Slide 15: Property: Diversifying and Ready for the Rebound
PROPERTY: DIVERSIFYING AND READY FOR THE REBOUND • CLOSED: A year ago, house builders and developers were prevented from building homes and selling them • The Agency was immediately restructured, reducing the staff overhead by 20%+ and investing in new digital opportunities • Diversified Client base
Slide 16: Technology: 2020 – 2021
TECHNOLOGY: 2020 – 2021 2020 • Rebranded, merged Mobility specialist and vacated Central London office • 12% YOY increase in profit contribution • 33 new client wins in 2020 (31 active in 2021) • 9 of top 12 clients grew, overall 10% growth in core business 2021 • Top 3 clients tracking ahead of for
Slide 17: Pathfindr
PATHFINDR SOMETIMES YOU NEED TO INNOVATE TO STAND STILL • 2020 lockdown effectively stymied the momentum built up in 2019; facilities, factories and manufacturing plants closed down or reduced output. However 2020 turnover still grew 62% vs 2019 • Pathfindr team pivoted to ‘Safe Distancing Assistant
Slide 18: One Mission
ONE MISSION 2020 COLLABORATION THE MOST SUCCESSFUL IT HAS EVER BEEN • £3.6m of Revenue cross- referred in 2020 • Not necessarily new Client spend but certainly spend previously outside of the Group
Slide 19: 2021 Revenue - The Sequential Recovery Continues
2021 REVENUE - THE SEQUENTIAL RECOVERY CONTINUES Impact (vs 2019) Q1 Q2 Q3 Q4 Q1 2021 -11% -12% -19% -26% -39%
Slide 20: 2021 Contribution to Profit (vs 2019)
2021 CONTRIBUTION TO PROFIT (vs 2019) 100% 80% 78% 60% 40% 20% 17% 12% 8% 0% H1 H2 Total Q1 2021 -20% -40% -55% -60% -65% -73% -80% -84% -100% Property Technology
Slide 21: The Vision Hasn't Changed (But It Has Been Sharpened)
THE VISION HASN’T CHANGED (BUT IT HAS BEEN SHARPENED) In Q4 2019 we repositioned as The Alternative Group for Ambitious Brands. This was/is the expression of our Group vision: THE PREFERRED CREATIVE PARTNER FOR REAL BUSINESS GROWTH We are a collective of creative Agencies led by Entrepreneurs who en
Slide 22: Collective Specialists
COLLECTIVE SPECIALISTS: MISSION INDUSTRY ADVANTAGE MISSION INTEGRATED MISSION ADVANTAGE
Slide 23: Collective Specialists
COLLECTIVE SPECIALISTS: MISSION INDUSTRY ADVANTAGE MISSION INTEGRATED MISSION ADVANTAGE enables our Agencies to call upon specialist expertise as needed, to deliver a flexible multi- discipline service for our Clients.
Slide 24: Innovation Bubble
fo) Innovation bubble ) MISSION MAD —> =» (
Slide 25: MSS: Operational Efficiency
MSS OPERATIONAL EFFICIENCY AN AGENCY BY AGENCY PURSUIT DRIVING PROFITABILITY AND IMPROVED MARGINS WONDERWALL: 3-fold improvement in the 2020 visibility of creative workload Proved the model: Reduction in employee down • Wellness time; 99% utilisation of • Remote working Creative and 30 mins per day
Slide 26: ESG Manifesto: Actions Not Words
ESG MANIFESTO: • Group relationships with Green Element and ACTIONS Creative Access • Network of environmental champions NOT WORDS • Far reaching social goals • Record of MISSION’s environmental footprint • A chance to be vocal in industry about positive change • Opportunity to be audited and achiev
Slide 27: Work That Pays
OUR VISION IS OUR GROWTH DRIVER THE PREFERRED CREATIVE PARTNER FOR REAL BUSINESS GROWTH • It’s not an either or • It’s a cause and effect • Our work as a creative partner delivers real business growth for our Clients • So it’s about effectiveness or … WORK THAT PAYS
Slide 28: Summary & Outlook - 2021
SUMMARY & OUTLOOK - 2021 Returning to pre-pandemic Continued 2021 started Hardest hit benefit of run rates in Q3 Agencies re- in line with MISSION to Q4 with bounding Advantage and expectations improved strongly MSS margin
Slide 29: Summary & Outlook – Longer Term
SUMMARY & OUTLOOK – LONGER TERM Accelerate the current growth of Organic Growth Margin revenue generated with improved Look for outside the UK margin through target of 14% collaboration and growth through Leverage our revenue increase realistic by acquisition market leading outstripping cost 2022 se