Slide 1: Second Quarter 2022 Earnings Presentation
Second Quarter 2022 EARNINGS PRESENTATION AUGUST 4 | 2022
Slide 2: Forward Looking Information & Other Information
FORWARD LOOKING INFORMATION & OTHER INFORMATION This presentation contains forward-looking statements. Statements in this presentation that are not historical facts, including without limitation the information under the heading "Financial Outlook" and statements about the Company’s beliefs and expe
Slide 3: Definitions of Non-GAAP Financial Measures
DEFINITIONS OF NON-GAAP FINANCIAL MEASURES Non-GAAP Financial Measures: In addition to its reported results, Stagwell Inc has included in this presentation certain financial results that the Securities and Exchange Commission (SEC) defines as "non-GAAP Financial Measures." Management believes that s
Slide 4: Reiterating Full-Year 2022 Financial Outlook
FINANCIAL Reiterating Full-Year 2022 Outlook OUTLOOK 18% - 22% Organic Net Revenue Growth 13% - 17% Organic Net Revenue Growth Ex-Advocacy $450M - $480M Adjusted EBITDA (excludes any contribution from acquisitions completed in 2022) ~30% Free Cash Flow Growth Note: All figures presented on a Pro For
Slide 5: Second Quarter Highlights
SECOND QUARTER HIGHLIGHTS NET DEBT: $1,305M | LTM ADJ. EBITDA: $416M | NET DEBT RATIO: 3.1X Strong GROWTH & MARGINS Increasing DIGITAL MIX 16% Total & Organic Net Revenue Growth 57% of Net Revenue from digital capabilities On top of 29% organic growth in 2Q21; 45% two-year stack 62% of adjusted EBIT
Slide 6: Summary Pro Forma Combined Financials
SUMMARY PRO FORMA COMBINED FINANCIALS Three Months Ended, Six Months Ended, $ in Thousands June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021 Net Revenue $ 556,316 $ 480,211 $ 1,082,953 $ 908,992 Billable Costs 116,597 74,954 232,863 135,000 Revenue $ 672,913 $ 555,165 $ 1,315,816 $ 1,043,992 B
Slide 7: Pro Forma Net Revenue
PRO FORMA NET REVENUE Three Months Ended, Six Months Ended, June 30, 2022 June 30, 2022 $ in Thousands Net Revenue Change Net Revenue Change 2021 Net Revenue $ 480,211 $ 908,992 Organic revenue 76,735 16.0% 178,114 19.6% Acquisitions (divestitures), net 5,988 1.2% 4,939 0.5% Foreign currency (6,618)
Slide 8: 2Q Net Revenue by Geography
2Q NET REVENUE BY GEOGRAPHY % OF NET REVENUE Organic Growth Y/Y 11% 8% 2Q Geography 2Q22 YTD United States 14% 18% 81% United Kingdom 33% 41% Other 22% 17% 11% 7% TOTAL 16% 20% YTD 81% Note: Figures presented on a Pro Forma basis giving effect to the combination as if completed on January 1, 2020. F
Slide 9: 2Q Net Revenue Mix by Principal Capability
2Q NET REVENUE MIX BY PRINCIPAL CAPABILITY 1 Digital Transformation 28% 57% Building & Designing Digital Experiences for Clients 2 Performance Media & Data Addressable on a Global Scale 19% 3 Consumer Insights & Strategy Tracking Across Consumer Journey 9% 4 Creativity & Communications Blue-Chip Cus
Slide 10: 2Q Year-over-Year Growth by Capability
2Q YEAR-OVER-YEAR GROWTH BY CAPABILITY % OF NET REVENUE 28% Organic Net Net Revenue Adjusted EBITDA* 19% Principal Capability Revenue Growth Growth Growth 9% 43% Digital Transformation 37% 36% 27% Performance Media & Data 17% 27% 58% Consumer Insights & Strategy 27% 26% 18% % Creativity & Communicat
Slide 11: 2Q Ex-Advocacy Net Revenue & Adjusted EBITDA
2Q EX-ADVOCACY NET REVENUE & ADJUSTED EBITDA $ in Millions Three Months Ended, JUNE 30, JUNE 30, % Change 2022 2021 NET Total Net Revenue $556 $480 15.8% REVENUE Advocacy Net Revenue 41 31 33.7% Ex Advocacy Net Revenue $515 $449 14.6% Three Months Ended, JUNE 30, JUNE 30, % Change 2022 2021 ADJ. Tot
Slide 12: New Business Update
NEW BUSINESS UPDATE Notable Business WINS & EXPANSIONS Net New Business 2Q $31M LTM $224M Ave. Net Revenue 2Q $6M AT TOP 25 CLIENTS 12
Slide 13: Strategic M&A Completed in July
STRATEGIC M&A COMPLETED IN JULY 100% ACQUISITION 100% ACQUISITION Omnichannel content creation and adaptation production Apollo is a real-time, AI-powered SaaS platform that uncovers company based in Kyiv, Ukraine with additional offices in consumer, creative and contextual insights for scaled moder
Slide 14: We Have Our Financial House in Order
Refinanced Bonds, Securing $1.1BN in financing › Fixed interest rate of 5.625% WE HAVE OUR in rising interest rate environment FINANCIAL › 8 years to maturity in 2029, HOUSE providing financial flexibility in order Secured $500M Revolving Credit Facility with flexible terms, 5-year maturity Moody’s
Slide 15: Expanding Our Global Footprint
53 EXPANDING CURRENT our global footprint AFFILIATE PARTNERS 1 15 5
Slide 16: Showing Up on the Biggest Stages
SHOWING UP on the biggest stages 116 6
Slide 17: Appendix
| me SL ASWELL Appendix
Slide 18: GAAP Consolidated Operating Performance
GAAP CONSOLIDATED OPERATING PERFORMANCE Three Months Ended Six Months Ended June 30, June 30, $ and Shares in Thousands 2022 2021 2022 2021 Revenue $ 672,913 $ 209,560 $ 1,315,816 $ 390,802 Cost of services 424,661 122,074 836,631 234,073 Office & general expenses 165,423 52,674 309,935 104,952 Depr
Slide 19: Net Income & Diluted Earnings Per Share Detail
NET INCOME & DILUTED EARNINGS PER SHARE DETAIL Three Months Ended, Six Months Ended, $ and Shares in Thousands June 30, 2022 June 30, 2022 Numerator (Basic) Net income $ 24,519 $ 58,141 Net income attributable to Class C shareholders (14,020) (31,741) Net income attributable to other equity interest
Slide 20: Liquidity
LIQUIDITY $ in Millions Available Liquidity (as of 6/30/22) Commitment Under Credit Facility $ 500 Drawn 298 Undrawn Letters of Credit 24 Undrawn Commitments Under Facility $ 178 Total Cash & Cash Equivalents 93 Total Available Liquidity $ 271 20
Slide 21: Pro Forma Capital Structure
PRO FORMA CAPITAL STRUCTURE Net Debt & Debt-Like ($M, as of 6/30/22) Pro Forma Common Equity (Thousands, as of 7/29/22) Revolving Credit Facility $ 298 Class A & B 132,136 Bonds 1,100 NCI1 29 Class C 164,427 DAC 197 RNCI & Other2 80 Awards Out. 5,029 Less: Cash 93 TOTAL NET DEBT & DEBT-LIKE $ 1,611
Slide 22: Global Network
GLOBAL NETWORK Stagwell’s Affiliate Network Significantly Expands Our Global Footprint Europe North America • Austria • Ukraine • Belgium • France • Bulgaria • Germany • Italy • Netherlands • Canada • Latvia • Poland • USA • Romania • Spain • Mexico • Slovak Republic • Sweden Asia Pacific • Slovenia
Slide 23: Thank You
Thank You Contact Us: IR@StagwellGlobal.com