Karnov Group Ab · OMXSTO:KAR
Karnov Group Ab — Q3 2019 Earnings Presentation
22 slides from Karnov Group Ab's earnings presentation, Nov 28, 2019
Slide 1: Third quarter 2019
Third quarter 2019 Q3 Flemming Breinholt, CEO and Dora Brink Clausen, CFO | 28 November 2019 Q3 2019 PRESENTATION 1
Slide 2: Q3 highlights and operational update
Q3 highlights and operational update Flemming Breinholt Q3 2019 PRESENTATION 2
Slide 3: Karnov – The leading B2B platform
Karnov – The leading B2B platform For legal and tax professionals in Denmark and Sweden PRACTITIONERS PUBLIC CONTENT SOURCES Enabling users to make better decisions, faster – every day Legal Accounting and practitioners audit firms CORPORATE Nordic Small & medium PROPRIETARY CONTENT blue-chips enter
Slide 4: Operational highlights
Operational highlights Successful roll-out of JUNO Key comments Continued roll-out of new joint platform JUNO Now 98% of 35.000+ users are onboarded Commercial launch has begun on November 1st. Karnov’s old platform already closed and the Zeteo platform from Norstedts Juridik to be closed down soon.
Slide 5: Operational highlight: Future Lawyer Survey
Operational highlight Future Lawyer Survey Key comments Enquiry among lawyers and others in the legal industry in Denmark and Sweden 3.500 respondents Significant customer interest Significant media coverage Q3 2019 PRESENTATION 5
Slide 6: Financial highlights year to date
Financial highlights year to date Steady growth with higher margin +6% +4% +1.1 pp 2.8 Net sales Organic growth Adjusted EBITA Leverage margin Q3 2019 PRESENTATION 6
Slide 7: Continued good performance in Denmark
Continued good performance in Denmark Key comments to Q3 5% net sales growth Sales driven by upselling to existing customers Unchanged adjusted EBITA Lower adjusted EBITA margin due to lower capitalization rate New tax magazine launched in collaboration with Danish auditor association, FSR. Q3 2019
Slide 8: Sales in Sweden boosted by offline increase
Sales in Sweden boosted by offline increase Key comments to Q3 11% net sales growth 15% increase in adjusted EBITA Sales driven by both online and offline impacted by timing effects in offline Positive market response to the new JUNO platform Q3 2019 PRESENTATION 8
Slide 9: Financial development
Financial development Dora Brink Clausen Q2 2019 PRESENTATION 9
Slide 10: Offline increase, improved sales and EBITA
Offline increase, improved sales and EBITA …but diluted margins slightly GROUP Net Sales, SEKm Adjusted EBITA, SEKm and +8% margin % +6% 200 80 39.5% 39% 38.9% 150 70 60 100 50 40 50 30 20 176 190 10 70 74 0 0 Q3 2018 Q3 2019 Q3 2018 Q3 2019 Q3 2019 PRESENTATION 10
Slide 11: Continued steady sales growth
Continued steady sales growth … due to strong online trend and offline timing effectsUP GROUP Net Sales, SEKm Key comments +7.6% Net sales growth of 7.6% 200 Organic growth of 5.8% and currency effects of 1.8%. 150 Online sales steady growth Sales boosted by timing effects on offline products 100 Bo
Slide 12: Continued profit improvement
Continued profit improvement GROUP Adjusted EBITA and margin, SEKm and % +6% Key comments 90 80 Continued year-over-year improvement in adjusted EBITA 70 Improvements due to higher sales and good 60 cost control 50 39% 40% 42% 39% 33% 34% 35% Adjusted EBITA margin declined 0.6 pp due to 40 product m
Slide 13: Continued trend to online and subscriptions
Continued trend to online and subscriptions Sales split subscription/non-subscription, % Sales split online/offline, % 100% 100% 17% 16% 18% 23% 22% 24% 80% 80% 60% 60% 77% 78% 76% 40% 40% 83% 84% 82% 1 pp increase in 1 pp increase in 20% 20% subscription-based online sales sales 0% 0% Q3 2018 Q3 20
Slide 14: Continued good performance in Denmark
Continued good performance in Denmark DENMARK Adjusted EBITA, SEKm and % Net Sales, SEKm Key comments +5% 5% net sales growth +0% 100 2% organic growth in line with expectations Currency effect added 3% 80 50 Sales driven by upselling to existing customers 60 40 42% 44% 38% 41% 41% 42% Unchanged adj
Slide 15: Offline sales increased in Sweden
Offline sales increased in Sweden SWEDEN Net Sales, SEKm Adjusted EBITA, SEKm and margin, % Key comments +15% +11% Net sales grew by 11% 100 45% 43% Continued steady growth in online 50 35% 80 34% Sales boosted by timing effects in offline 40 29% Adjusted EBITA improved by 15% or SEK 4 m despite 60
Slide 16: Expected weak seasonal cash flow improved
Expected weak seasonal cash flow improved GROUP Adj. operating cash flow, SEKm and cash conversion, % 219% Key comments 200 177% Adjusted operation cash flow improved by SEK 14 168% m to SEK 2 m due to better EBITDA and working 150 capital Cash conversion rate positive also in Q3 100 Leverage at 2.8
Slide 17: Performing in line with financial targets
Performing in line with financial targets Year-to-date performance Growth Profitability Capital structure Annual organic net sales growth of A higher adjusted EBITA margin Net debt to adjusted EBITDA 3-5% in the medium term, in the medium term. of no more than 3.0. This level may supplemented by sel
Slide 18: Summary of first nine months
Summary of first nine months 1 2 YTD as communicated at listing – Organic growth of 4% JUNO rollout progressing well – Adjusted EBITA margin up 1.1 pp – Leverage below 3x 3 4 Solid capital structure created Solid base to grow business further Q3 2019 PRESENTATION 18
Slide 19: Q&A
Q&A Better decisions, faster Find what you need, trust what you find and do it quickly. For more information visit www.karnovgroup.com/en/section/investors/ Q3 2019 PRESENTATION 19
Slide 20: Appendix
Appendix Q3 2019 PRESENTATION 20
Slide 21: Key ratios per quarter
Key ratios per quarter Key ratios per quarter Q3 Q2 Q1 Q4 Q3 TSEK 2019 2019 2019 2018 2018 Net sales 189.533 173.440 204.931 178.817 176.175 Organic growth, % 5,8% 3,0% 3,2% 0,8% 4,8% EBITA 69.106 30.458 67.501 36.529 60.194 EBITA margin, % 36,5% 17,6% 32,9% 20,4% 34,2% Adjusted EBITA 73.756 60.123
Slide 22: Important information
Important information The following applies to this document, the oral presentation of the information in this document by Karnov or any person on behalf of Karnov, and any question-and-answer session that follows the oral presentation. This presentation may contain forward-looking statements that r