Ebiquity PLC · LSE:EBQ
Ebiquity — FY2010 Earnings Presentation
40 slides from Ebiquity's earnings presentation, Jul 23, 2010
Slide 1: Company Presentation, Year ended 30 April 2010
Company Presentation Year ended 30 April 2010 23rd July 2010 an Ebiquity company
Slide 2: Another year of strong growth
Another year of strong growth • Completed a number of acquisitions including that of Xtreme Information • Continued International growth • Strong recurring revenue • Demand for transparency, benchmarking and measurement continue to drive growth 2 2
Slide 3: Total group revenues increased by 15% to £21.2m
Total group revenues increased by 15% to £21.2m 10% Increase from organic business 18% Analytics business revenue Increase, to £15.2m 31% Revenue growth in international assignments within Analytics 80% Platform business renewals 3 3
Slide 4: Underlying operating profit up 12%
Underlying* operating profit up 12% • 7% increase from organic business to £2.5m (2009: £2.4m) • Excluding impact of non trading FX, organic business up 30% to £2.7m (2009: £2.1m) • Organic margin excluding non trading FX up to 13.3% (2009: 11.2%) • Underlying diluted EPS up 5% to 5.55p (2009: 5.28p
Slide 5: The new economic reality has reset the marketing and media agenda
The new economic reality has reset the marketing and media agenda - permanently 5
Slide 6: The new marketing and media reality
The new marketing and media reality • Media and marketing spend under pressure like never before • Refocus on value, effectiveness and financial return • Every pound now needs to be justified • Corporate procurement leading to greater financial rigour • Growing demand for transparency, benchmarking
Slide 7: Repositioned to exploit a growing market
Repositioned to exploit a growing market “Marketing leaders ....want to see improved operational visibility, better controls and more accountability of spend.” 31% of marketers expect to initiate or undertake marketing performance measurement programs in 2010. ‘Improving efficiency and campaign effe
Slide 8: Accountability and strong ROI thinking quote
“Accountability and strong ROI thinking are at the forefront at the moment – the times when we just spent the money are over. We want to know exactly where to spend the money and where to get the best return…” Bernard Glock, former President, Global Media & Communication, P&G 8
Slide 9: The story of a company repositioned to exploit this opportunity
The story of a company repositioned to exploit this opportunity 9
Slide 10: Leading independent provider of analytics and insight services
Already a leading independent provider of analytics and insight services to the global marketing and media community. 10
Slide 11: Our ambition: clear leader within five years
Our ambition is to to become the clear leader within five years in a market we estimate to be worth over £300 million and growing 11
Slide 12: Providing global solutions and creating new markets
Providing global solutions and creating new markets 12
Slide 13: Investing in future International growth
Investing in future International growth • Acquisition of Xtreme Information Services Limited, an international media intelligence group with annual revenues of £18m • Acquisition of outstanding equity in TMC advertising monitoring business in Germany • Continual investment strengthening global pres
Slide 14: Xtreme Information
Adding a unique international capability Xtreme Information Global Advertising Intelligence and Insight 14 14 70 countries
Slide 15: A uniquely global business
A uniquely global business • Market leader in international advertising intelligence • Largest advertising capture footprint covering 70 countries • 65 of Top 100 brands (AdAge 2008) currently subscribe to Xtreme services • Competitive analysis and insight products aimed at global advertisers • 89%
Slide 16: Subscription based revenue model
Subscription based revenue model 16 16
Slide 17: Flash Report Intelligence Email
Flash Report Intelligence Email Navigation Bar Click on Flash Reports hyperlink to go directly to that ad in Record Detail the website. ► What is new and why is it important to L’Oréal? ► View ads in 2 clicks 17
Slide 18: Strategic highlights
Strategic highlights • Begun to develop significant cross sales opportunities • Strengthened international product offering • Created leading UK and German competitive intelligence businesses • Builds deeper and stronger client relationships • Enhanced our research and strategic capabilities • Moves
Slide 19: Financial Summary
Financial Summary Year ended 30 April 2010 an Ebiquity company
Slide 20: Acquisitions: summary of acquired companies
Acquisitions: summary of acquired companies All numbers in £’000s Xtreme Excellence TMC Information Media Acquisition date 13 April 2010 13 April 2010 1 March 2010 Reporting division Platform Platform Analytics Annual revenue* 18,475 2,377 358 Operating profit (pre 1,486 16 18 highlighted)* * Latest
Slide 21: Revenue
Revenue All numbers in £’000s Year ended Organic Year ended 30 April 2010 30 April 2009 YOY Organic Acq’ns Total Total % Analytics 15,176 21 15,197 12,842 18.2% Platform 5,001 1,020 6,021 5,633 (11.2%) Intersegment elimination - - - (56) - Total 20,177 1,041 21,218 18,419 9.5% 21
Slide 22: Organic revenue: Analytics division
Organic revenue: Analytics division International revenue up 31% to £8m (an increase of £1.9m) •Representing a greater proportion of Analytics revenue: 2009/10 2008/9 52% 47% •Representing a greater proportion of total Group revenue: 2009/10 2008/9 39% 33% International revenue: non UK sourced reven
Slide 23: Organic revenue: Platform division
Organic revenue: Platform division Advertising monitoring •Softer renewal rates (by value) but improved from half year (Oct 09: 74%): 2009/10 2008/9 80% 84% Editorial monitoring •Newslive showing good sales traction, and now represents larger share of Platform: 2009/10 2008/9 13% 7% 23
Slide 24: Gross profit
Gross profit All numbers in £’000s Year ended Organic Year ended 30 April 2010 30 April 2009 YOY Organic Acq’ns Total Total % Analytics 8,532 (5) 8,527 6,907 23.5% Platform 2,432 639 3,072 2,938 (17.2%) Total 10,984 634 11,598 9,845 11.6% 24
Slide 25: Organic gross margin analysis
Organic gross margin analysis Increased revenue 2009/10 2008/9 and effective Analytics 56% 54% management of staff and partner costs 2009/10 2008/9 Reduced revenue partially offset by Platform 49% 52% reduced staff costs 2009/10 2008/9 Total 54% 53% Including acquisitions: 2009/10 gross margin is 55
Slide 26: Underlying operating profit (pre highlighted items)
Underlying operating profit (pre highlighted items) All numbers in £’000s Year ended Organic Year ended 30 April 2010 30 April 2009 YOY Organic Acq’ns Total Total % Analytics 7,623 (20) 7,603 6,017 26.7% Platform 942 342 1,284 1,296 (27.3%) Unallocated expenses (5,874) (203) (6,077) (5,242) (12.0%)
Slide 27: Organic underlying profit margin incl non trading forex
Organic underlying profit margin incl non trading forex 2009/10 2009/10 EBITDA margin 15.0% 15.3% 2009/10 2009/10 Operating Profit (EBIT) margin 12.5% 12.8% Including acquisitions: 2009/10 EBITDA mgn is 15.0% and EBIT mgn is 12.5% 27
Slide 28: Organic underlying profit margin excl non trading forex
Organic underlying profit margin excl non trading forex 2009/10 2009/10 EBITDA margin 15.8% 13.7% 2009/10 2009/10 Operating Profit (EBIT) margin 13.3% 11.2% Including acquisitions: 2009/10 EBITDA mgn is 15.8% and EBIT mgn is 13.2% 28 28
Slide 29: Highlighted items: pre operating profit
Highlighted items: pre operating profit All numbers in £’000s Year ended Year ended 30 April 2010 30 April 2009 Acq’n Organic Total Total related Recurring: Share based expenses 308 - 308 313 Amortisation of purchased intangibles 362 50 412 362 670 50 720 675 Non recurring: Acquisition integration c
Slide 30: Profit before tax
Profit before tax All numbers in £’000s Year ended Organic Year ended 30 April 2010 30 April 2009 YOY Acq’n Organic Total Total % related Underlying operating profit 2,524 119 2,643 2,363 6.8% Highlighted items - recurring (670) (50) (720) (675) 1.0% - non recurring (159) (1,307) (1,466) (258) 38.4%
Slide 31: Diluted EPS
Diluted EPS 2009/10 2008/9 Excluding acq’ns Including acq’ns 2009/10 2009/10 2008/9 Reported 4.24p 0.46p 0.26p 2009/10 2009/10 2008/9 Underlying 5.11p 5.55p 5.28p The decrease in the organic underlying (from 5.28p to 5.11p) is mainly due to: a) an increase in the number of potentially dilutive share
Slide 32: Financing: summary
Financing: summary All existing loan facilities were cancelled and replaced with a new facility with Bank of Ireland All numbers in £’000s Drawn at Held as Available Total facility 30 April 2010 guarantee facility Term loan 8,000 8,000* - - Revolving Credit Facility 2,500 - 500 2,000 (RCF) Acquisiti
Slide 33: Operating cashflow and net debt
Operating cashflow and net debt All numbers in £’000s 30 April 2010 30 April 2009 Net cash from operating activities 2,421 827 Cash 5,243 1,246 Loans to associates 285 362 Debt (7,569) (3,800) Total (2,041) (2,192) Of the £1,502k of acquisition costs, £609k remains unpaid at the year end Of the £1,4
Slide 34: Outlook
Outlook 1. The process of integration has started well. 2. We are confident that we will deliver the growth and cost synergies that will drive earnings. 3. Cross selling across international clients - already proving very promising. 4. Strong indications that our unique set of services will enable u
Slide 35: Financial Appendices
Financial Appendices Year ended 30 April 2010 an Ebiquity company
Slide 36: Statement of financial position
Statement of financial position Apr 10 Apr 09 Non current assets Goodwill 30,235 8,754 Purchased intangibles 9,291 2,019 Other 3,418 2,098 42,944 12,871 Current assets Trade debtors 8,300 3,118 Accrued income 2,081 1,836 Cash 5,243 1,246 Loans to associates 285 362 Bank security deposits 300 - Prepa
Slide 37: Cashflow statement
Cashflow statement Apr 10 Apr 09 Cash generated from operations 3,243 1,364 Finance expense (271) (268) Income taxes paid (551) (269) Net cash from operating activities 2,421 827 Investing activities Acq’n of subsidiaries, net of cash acquired (326) - Purchase of PPE (164) (454) Capitalised developm
Slide 38: Acquisitions: fair value of consideration
Acquisitions: fair value of consideration All numbers in £’000s Xtreme Excellence TMC Total Information Media Cash 770 25 134 929 Shares 11,695 1,106 - 12,711 Convertible loan notes 9,662 - - 9,662 Acquisition costs 1,398 25 79 1,502 Less assumed debt (8,274) - - (8,274) Deferred consideration - - 8
Slide 39: Acquisitions: fair value of assets acquired
Acquisitions: fair value of assets acquired All numbers in £’000s Xtreme Excellence TMC Total Information Media Net book value of assets (8,402) 90 - (8,312) Accounting convention adjustments (1,676) (61) - (1,737) Carrying value of net assets (10,078) 29 - (10,049) Fair value adjustments: Identifia
Slide 40: Acquisitions: goodwill summary
Acquisitions: goodwill summary All numbers in £’000s Xtreme Excellence TMC Total Information Media Fair value of consideration 15,251 1,181 300 16,732 Fair value of assets acquired (5,687) 843 94 (4,750) Goodwill 20,938 338 206 21,481 Goodwill is not amortised, but is reviewed for impairment on an a