Slide 1: Financial Results for the Full Year ending 31 December 2021
Financial Results for the Full Year ending 31 December 2021 8 March 2022
Slide 2: Caution statement
2021 FULL YEAR RESULTS Caution statement No representations or warranties, express or implied are given in, or in respect of, be affected by other factors that could cause actual results, and our plans and this presentation or any further information supplied. In no circumstances, to the objectives,
Slide 3: 2021 – Hybrid is here
2021 FULL YEAR RESULTS 2021 – Hybrid is here ✓ Increasing demand as more companies move to hybrid ✓ Significant growth opportunities as the supply-side partners with IWG ✓ Strong growth in franchise and partner income ✓ Well established pipeline and higher levels of network growth expected this year
Slide 4: 2021 – Hybrid is here
2021 FULL YEAR RESULTS 2021 – Hybrid is here ✓ Strong end to 2021, consistent recovery from March 2021 ✓ Overheads reduced by £52m with further optimisation of the operating model and cost base ✓ Excellent momentum into Q1 2022 ✓ High level of revenue in order-book for Q1 and full year ✓ Mix continu
Slide 5: Financial highlights
2021 FULL YEAR RESULTS Financial highlights £m £m £m £m £m £m ✓ Month on month accelerating Key financial metrics performance from a low in March 2021 2020 change 1H21 2H21 change Revenue 2,228 2,432 (204) 1,045 1,183 138 ✓ Increases in price and occupancy Gross profit / (loss) 81 (174) 255 delivere
Slide 6: Recovery of trading performance
2021 FULL YEAR RESULTS Recovery of trading performance Pre-2020 occupancy (%) New sales price (£) Services (£m) Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 Q1-20 Q2-20 Q3-20 Q4-20 Q1-21 Q2-21 Q3-21 Q4-21 ✓ Sequential recovery of occupancy, returnin
Slide 7: Ongoing sequential trading recovery
2021 FULL YEAR RESULTS Ongoing sequential trading recovery Centre cash contribution (£m) Overheads (£m) 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 2021 Full Year Results – 08 March 2022 7
Slide 8: Growing our network
2021 FULL YEAR RESULTS Growing our network Finland Manhattan Saudi Arabia 8 Italy SE Asia Canada 2021 Full Year Results – 08 March 2022
Slide 9: Capital-light growth
2021 FULL YEAR RESULTS Capital-light growth ✓ Strategy of moving to capital-light franchise and partnered centres is working Network mix (Dec 20 to Dec 21) ✓ Growing fee income Conventional Conventional 72% 65% ✓ Significant de-risking of the network in 2021 ✓ 25% increase in capital-light centres +
Slide 10: Strong performance of 2020 openings – company-owned growth
2021 FULL YEAR RESULTS Strong performance of 2020 openings – company-owned growth 70 60 50 1Q21 2Q21 3Q21 4Q21 40 30 20 2017 2018 2019 2020 2021 Investment per sq.ft. (£) Centre cash contribution – 2020 cohort (£m) ✓ Building trading momentum in the company-owned estate, with particular acceleration
Slide 11: Financial results
2021 FULL YEAR RESULTS Financial results £m 2021* 2020* Change ✓ Revenue inflection beginning in April, with growth strengthening through the year System-wide revenue 2,498.5 2,721.9 (223.4) ✓ Pre-growth, annualised run rate cost reduction of Revenue 2,227.9 2,431.9 (204.0) £328.7m Open centre reven
Slide 12: Revenue bridge
2021 FULL YEAR RESULTS Revenue bridge £(14.2)m portfolio improvement £(98.7)m market disruption 2,431.9 112.0 111.7 2,319.0 2,227.9 (126.2) (210.4) (91.1) £m FY - 2020 Occupancy Price New Closures Sub-total FY – 2021 FX FY - 2021 excl. FX impact 2021 Full Year Results – 08 March 2022 12
Slide 13: Centre & overhead cost reduction bridge
2021 FULL YEAR RESULTS Centre & overhead cost reduction bridge 2,800.0 £240.9m property savings 2,605.3 £40.8m other centre costs and SG&A savings 2,600.0 129.0 2,452.6 2,400.0 (158.8) (82.1) (12.9) (7.6) (20.3) 2,200.0 £m 2,000.0 1,800.0 1,600.0 FY - 2020 Closed centre Rent savings Product cost SG&
Slide 14: Cash flow
2021 FULL YEAR RESULTS Cash flow £m 2021* 2020* Change Adjusted EBITDA 79.6 133.8 (54.2) Working capital (174.1) 242.3 (416.4) ✓ Cash-flow from open centre trading of £117.7m Growth related partner contributions (50.4) (106.6) Net maintenance capital expenditure (95.9) (81.9) ✓ Net proceeds of £18.9
Slide 15: Cash flow bridge
2021 FULL YEAR RESULTS Cash flow bridge Net RCF debt £88.7m Trading Network investment £165.8m £(236.9)m 18.9 146.9 Convertible bond Non-recurring £308.3m working capital £59.2m (95.9) 283.7 £m (351.1) 50.4 (34.0) (397.0) (29.2) (162.2) (224.5) Net debt Pre-21 Net proceeds Maintenance Growth Landlor
Slide 16: Hybrid is working
2021 FULL YEAR RESULTS RESULTS Hybrid is working 2021 Full Year Results – 08 March 2022 16
Slide 17: Strategic review – capturing the once in a lifetime opportunity
2021 FULL YEAR RESULTS Strategic review – capturing the once in a lifetime opportunity 1 2 3 4 5 Maximize Clear Leverage Capital light company- Free cash-flow strategic intellectual and growth owned generation objectives digital assets performance Rapid adoption of hybrid working is expected to driv
Slide 18: Market growth dynamics
2021 FULL YEAR RESULTS Market growth dynamics >15X 90% of EMPLOYEES WANT FLEXIBILITY in where and when they work[1] GROWTH by 2030 of companies report BETTER RETENTION 89% rates because of their FLEXIBLE WORK OPTIONS[2] 88% of companies are planning a FULL SHIFT to FLEXIBLE WORKING[3] 1. HR Report,
Slide 19: Why people and companies are moving to IWG
2021 FULL YEAR RESULTS Why people and companies are moving to IWG Making each day a great day at work … in every town, city and suburb around the world 30,000 PEOPLE A better work life balance IWG LOCATIONS PLANET Multiple sustainability benefits PROFIT 2010 2015 2020 2025 2030 Significant cost savi
Slide 20: Coverage and network is why 83% of Fortune 500 companies are our customers
2021 FULL YEAR RESULTS Coverage and network is why 83% of Fortune 500 companies are our customers 2021 Full Year Results – 08 March 2022 20
Slide 21: Our brands make any building, any space work
2021 FULL YEAR RESULTS Our brands make any building, any space work 2021 Full Year Results – 08 March 2022 21
Slide 22: Our brands make any location work
2021 FULL YEAR RESULTS Our brands make any location work BUSINESS CBDs TOWNS PARKS MULTIPLE BUILDINGS ENTIRE BUILDINGS FLOORS TRANSPORT SUBURBS RURAL HUBS 2021 Full Year Results – 08 March 2022 22
Slide 23: ESG embedded within our strategy
2021 FULL YEAR RESULTS ESG embedded within our strategy Better outcomes for customers, suppliers, colleagues and the environment Environmental Social Governance A sustainable working model Creating opportunity A sustainable working model ✓ Global programmes for recycling ✓ Focus on wellbeing, health
Slide 24: Strategic objectives – capital light growth
2021 FULL YEAR RESULTS Strategic objectives – capital light growth ✓ Strategically scale is key Net growth (sq.ft.) ✓ Franchise proposition successful and growing 35% 30% ✓ Management agreements growing 30% 25% ✓ Reduced percentage of company-owned growth with relatively less capital deployed 20% 15
Slide 25: Strategic objectives – maximise company-owned performance
2021 FULL YEAR RESULTS Strategic objectives – maximise company-owned performance 35% 30% CBITDA % 25% 20% 15% 10% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2016 2017 2018 2019 2020 2021 2022 ✓ Scale and reduced marginal costs underpins successive margin advancement ✓
Slide 26: Strategic objectives – leverage intellectual and digital assets
2021 FULL YEAR RESULTS Strategic objectives – leverage intellectual and digital assets ✓ Continue to invest c. £50m each year in our core technology platform ✓ Continued investment in R&D and product development to support revenue growth ✓ Reduce like-for-like unit overhead through improved efficien
Slide 27: Creating the largest digital workspace platform with Instant Group
2021 FULL YEAR RESULTS Creating the largest digital workspace platform with Instant Group ✓ Merger of IWG booking and property management assets with Instant Group, the world's leading provider of digital workspace services ✓ Merged business creates the largest digital platform for supply of digital
Slide 28: Strategic objectives – free cash-flow generation
2021 FULL YEAR RESULTS Strategic objectives – free cash-flow generation ✓ Investment in company owned growth reduced ✓ Company generated cashflow ✓ MFA and unit sales ✓ Rapidly growing management income ✓ Scale and cost efficiency ✓ Separation of digital assets 2021 Full Year Results – 08 March 2022
Slide 29: Outlook
2021 FULL YEAR RESULTS Outlook ✓ Clear strategic plan in place, with resources to deliver ✓ Well positioned to grow strongly during 2022 and beyond - Grow EBITDA & cash flow in company-owned centres - Rapidly grow the network and free cash through partnering ✓ Strengthening structural tailwinds ✓ Es