Modern Times Group Mtg Ab Class A · OMXSTO:MTG_A
Modern Times Group Mtg Ab Class A — Merger or Acquisition (November 2024)
40 slides from Modern Times Group Mtg Ab Class A's merger presentation, Nov 12, 2024
Slide 1: Disclaimer
Disclaimer Acceptance of li mitations: The information in this presentation (the “Materi al”) is presented by Modern Ti mes Group MTG AB (publ) (the “Company” and together with its direct and indirect subsidiaries, the “Group”) solely for information purposes. By accessing and reading t hi s Materia
Slide 2: Today's presenters
Today’s presenters Maria Redin Arnd Benninghoff President & CEO EVP Gaming Modern Times Group MTG 2
Slide 3: MTG signs transformative deal to acquire Plarium
MTG signs transformative deal to acquire Plarium 12th of November 2024 Modern Times Group MTG 3
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Slide 5: Plarium is home to RAID, one of the strongest IPs in mobile
Plarium is home to RAID, one of the strongest IPs in mobile, and further 3 more top grossing games USD 613m USD 2.3bn Revenue1 RAID lifetime revenue3 LTM Q3 2024 USD 137m 1.9m Adj. EBITDA1 Daily active users LTM Q3 2024 Avg. LTM Q3 2024 79% USD 0.9 Cash conversion1,2 ARPDAU LTM Q3 2024 Avg. LTM Q3 2
Slide 6: A perfect fit: Scaled portfolio of evergreen IPs and best-in-class tools
A perfect fit: Scaled portfolio of evergreen IPs and best-in-class tools that elevate the combined businesses Midcore Casual Tools & tech Modern Times Group MTG 6 Artwork is property of Plarium Global and is used with permiss io n
Slide 7: Key transaction highlights
Key transaction highlights Upfront Purchase price consideration of USD 620 million, of which USD 20 million deferred to 2026 consideration Consideration to be offset by the cash flow that will be generated from the start of Q4 2024 and until Valuation closing, resulting in an estimated final EV/adju
Slide 8: Deal to generate immediate value accretion through doubling of key financial metrics
Deal to generate immediate value accretion to shareholders through a doubling of all key financial metrics Combined revenue Combined adj. EBITDA Combined free cash flow LTM Q3 2024, SEKm1 LTM Q3 2024, SEKm1 LTM Q3 2024 (indicative), SEKm 2 12,362 3,121 2,076 Highly EPS accretive +2.8% YoY combined r
Slide 9: Combined we become a leading gaming group with synergy opportunities
Combined we operationally become a leading gaming group with great synergy opportunities 45+ Live games 10 Games in development 7.9m Daily active users1 2,300+ Talented employees A di versi fi ed port fol io of genre-leading Multiple promising new games in A significant reach of mi llions of users M
Slide 10: We are now a top-10 mobile games developer in the West
We are now a top-10 mobile games developer in the West Gross revenue, iOS and Android, CY23, USDm # Company Headquarter 1 1 Sweden 2 Irel and 3 Israel 4 United States 5 United States 6 Fi nl and #1 listed mobile gaming company in 7 Israel Europe 2 8 United States #2 listed mobile gaming company in t
Slide 11: Plarium overview
Plarium overview Modern Times Group MTG 11 Artwork is property of Plarium Global and is used with permiss ion
Slide 12: Plarium is the home to the #1 RPG game: RAID: Shadow Legends
Plarium is the home to the #1 RPG game: RAID: Shadow Legends Strong portfolio of long-lived IPs Experienced management team HQ in Tel Aviv, Israel RAID: Founded in 2009 Shadow USD 2.3bn1 Legends Lifetime revenue Experts in RPG games ~1,290 employees 1 Vi kings: Mech Arena Merge Gardens Schraga Mor (
Slide 13: Plarium has a proven track record of successfully scaling popular games
Plarium has a proven track record of successfully scaling popular games Gross revenue and game launches1 Merge Gardens Mech Arena RAID: Shadow Legends Vikings: War Sparta: War of Clans of Empires 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Facebook games Transition to mobil
Slide 14: Strong portfolio of live titles and a pipeline of new games
Strong portfolio of live titles and a pipeline of exciting new games Vikings: War of Clans Mech Arena Merge Gardens Elf Islands Viking-themed strategy game focused Team-based action shooter Casual puzzle game focused on New casual simulation farming game on kingdom-building and management with real-
Slide 15: RAID: Shadow Legends is a category leader and strong evergreen IP
RAID: Shadow Legends is a category leader and one of the world’s strongest evergreen IPs in mobile gaming Top games in RPG genre by IAP revenue in EU and NA, LTM Q3 2024 RAID: RPG RAID: Shadow Legends #1 Shadow Legends $3.7bn Market size4 Top-ranked, squad RPG where players can collect and upgrade p
Slide 16: RAID drives sustainable growth thanks to resilient cohorts
RAID: Shadow Legends drives sustainable growth and long-term success thanks to strong and resilient cohorts The power of evergreen IPs in mobile gaming Cohorted revenues, RAID: Shadow Legends Players who first installed the game in: Longevity & stable revenues 2019 2020 2021 2022 2023 2024 Evergreen
Slide 17: RAID is much more than just a game
RAID: Shadow Legends is much more than just a game – a world-class renowned IP that can travel across multiple channels Mobile games PC/console Toys games RAID has been Positive brand Over USD 1bn UA has been Over 70% of mobile downl oaded close to sentiment with a invested i n RAID players are awar
Slide 18: Plarium's success driven by strong capabilities and state of the art tools
Plarium’s success is driven by strong capabilities and leveraging state of the art tools and tech, enabled by an amazing team 360 proprietary marketing tools implemented, servicing titles across mid- core & casual Development approach focusing on D2C Distribution Platform enabling better maximizing
Slide 19: Plarium with organic growth and increased adj. EBITDA in 2024
Plarium with organic growth and significantly increased adj. EBITDA in 2024 despite challenging market Financial overview1, USDm Quarterly gross revenue1, USDm X% Adj. EBITDA margin RAID standalone is +1.2% growing at 2.3% p.a. 606 613 +54% 137 89 LTM Q3’23 LTM Q3’24 LTM Q3’23 LTM Q3’24 Q4 2022 Q1 2
Slide 20: 3 layers of growth drivers: From expansion of Raid to new games
3 layers of growth drivers: From expansion of Raid to new games Elf Islands – soft launched In development new New game simulation farming game action/extraction shooter TBA Publish RAID in China Localization of RAID in New game based on the together with local other emerging markets RAID IP partner
Slide 21: Strategic fit and rationale
Strategic fit and rationale Modern Times Group MTG 21 Artwork is property of Plarium Global and is used with permiss ion
Slide 22: Clearly defined criteria for joining the MTG village
Clearly defined criteria for joining the MTG village Relevant scale ✓ Category leadership ✓ Evergreen IPs ✓ Cross-platform exposure ✓ Synergistic tools & tech ✓ Depth of talent ✓ Modern Times Group MTG 22 Artwork is property of Plarium Global and is used with permiss io n
Slide 23: Highly selective and disciplined in M&A and Portfolio Management
Highly selective and disciplined in M&A and Portfolio Management Combined pro-forma revenue of our last 4 acquisitions Cash proceeds from Cash distributed to divestments investors2 23% CAGR1 SEK 8.2 bn SEK 3.8 bn Indexed IAP market, Europe & NA Q4’20 Q1’21 Q1’22 Q1’23 Q1’24 Q2’24 Q1’20 Q2’20 Q3’20 Q
Slide 24: Plarium fits well within MTG's village of evergreen IPs
Plarium fits well within MTG’s village which consists of strong, leading, evergreen IPs across different genres and platforms Siddharth Jain Scott Walker Shaun R utland Schraga Mor Hendrik Klindworth Alex Ekvall Co-Founder & CEO Partner & CEO Co-Founder & Co-CEO CEO Co-Founder & CEO Co-Founder & CEO
Slide 25: Plarium strengthens our diversified portfolio and adds new games
Plarium strengthens our diversified portfolio and adds exciting new games to drive future organic growth Produce1 Introduce Grow Established Harvest 2 new games Bloons Heroes of Warhammer Crossword Bloons TD6 Rise of 2 new games Two Square F1 Clash Elvenar Card Storm History 40k:Tacticus Jam Culture
Slide 26: We're confident we can extend the longevity of RAID
Experienced in managing strong IPs, we’re confident that we can extend the longevity of RAID for a long time ahead Gross revenue per month since launch Multiple levers for RAID longevity 5 years Strong resilient cohorts Covid-19 boost Covid-19 hangover Mar’20 to Jul’21 Jul’21 to Apr’23 Evergreen IP
Slide 27: High audience affinity and relevant scale as synergy enabler
High audience affinity and relevant scale as synergy enabler Demographics per game, avg. YTD1,2 Combined daily active Combined monthly users2 active users3 InnoGames Snowprint Hutch Ninja Kiwi PlaySimple Plarium 50 4.2m DAU2 7.9m 34.9m 45 DAU split by geography2,4 Merge Gardens Average age Mech 40 F
Slide 28: Plarium Play and GoGame will accelerate our own Flow Platform
Plarium Play and GoGame will accelerate our own Flow Platform D2C distribution platform D2C channel bypassing Cross-platform login and Fully integrated payment In-game reward platform fees progression and billing solution system 64 FTEs1 Proprietary UA solution Management of Partners Optimizing UA a
Slide 29: Multiple avenues of meaningful synergies
Multiple avenues of meaningful synergies Strong synergy Monetization Marketing Plarium to MTG improvements GoGame improvements Plarium Play potential estimating double digit USDm impact on revenue and EBITDA Additional Browser Casual Platform MTG to Plarium marketing extension optimization expansion
Slide 30: Through Plarium we strengthen our ability to execute our strategy
Through Plarium we strengthen our ability to execute our strategy Strong and stable cash flow generation will provide us with optionality for further value accretive M&A Industry-leading tools and services that can be plugged into our existing Flow Value accretive M&A Platform and accelerate synergi
Slide 31: Combined profile & transaction structure
Combined profile & transaction structure Modern Times Group MTG 31 Artwork is property of Plarium Global and is used with permiss ion
Slide 32: Together we become a meaningful player of scale: 12+ SEKbn revenue
Together we become a meaningful player of scale: 12+ SEKbn in revenue with a strong cash flow generation profile Revenue, SEKm1 6,469 5,893 12,362 Constant FX growth, %2 1.2% 4.5% 2.8% Adj. EBITDA, SEKm1 1,471 1,651 3,121 Adj. EBITDA margin, % 22.7% 28.0% 25.3% EBIT, SEKm3 1,188 985 2,173 EBIT margi
Slide 33: We are happy with the agreed value accretive deal terms
We are happy with the agreed value accretive deal terms • Purchase price consideration of USD 620 million, of which USD 20 million deferred to 2026 Plarium Valuation1 • Consideration to be offset by the cash flow that will be generated from the start of Q4 2024 and until closing, which is expe cted
Slide 34: Performance based earn-outs bring substantial upside for both parties
Performance based earn-outs are designed to bring substantial upside for both parties Illustrative gross revenue development (USDm) 1,185 • Earn-out 1: USD 30 million, payable in 2026, Up to USDm 170 in dependent on RAID performance in 2025 earn-out 2 potential between USDm 777- • Earn-out 2: Up to
Slide 35: Transaction fully funded by cash and debt with moderate leverage
Transaction fully funded by cash and debt with moderate leverage Financing bridge, USDm 1.9x 1.1x Plarium’s cash generated from Q4 2024 to closing will Indicative initial Net debt / Indicative initial Financial belong to MTG EBITDA1 debt / EBITDA1 600 <600 20 150 160 150 140 Debt has a maturity prof
Slide 36: Cementing a strong balance sheet and cash flow for future flexibility
Cementing a strong balance sheet and cash flow that provides with great future flexibility Proforma cash flows 1,2, SEKb Opportunity to leverage robust cash flows across diverse strategic avenues Plarium MTG Continue buying back shares 2.1 Amortize bank debt and deleveraging Doubling 1.2 FCF Continu
Slide 37: Ending remarks
Ending remarks Modern Times Group MTG 37 Artwork is property of Plarium Global and is used with permiss ion
Slide 38: This transaction marks our transformation into a leading mobile gaming group
We have come a long way and this transactions marks our complete transformation into a leading mobile gaming group Esports and gaming expansion Transition to pure play gaming group One of the leading mobile gaming groups in the West • Acquired ESL and DreamHack • Acquired Hutch, Ninja Kiwi, PlaySimp
Slide 39: Conclusion & next steps
Conclusion & next steps Signing Competition filing • Plarium acquisition strengthens MTG as a leading Western Closing Capital Markets Day mobile gaming company with evergreen IPs Today Nov’24 - Q1’25 Q1 2025 H1 2025 • MTG will benefit from Plarium’s tech and expertise for long- term synergies and st
Slide 40: Q&A
Q&A Modern Times Group MTG 40 Artwork property of Plarium Global and is used with permiss ion
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