Mission Group Public Limited Company · LSE:TMG
Mission Group Public — The Mission Group — FY2022 Earnings Presentation
53 slides from Mission Group Public's earnings presentation, Mar 28, 2023
Slide 1: Annual Results for the year ending 31st December 2022
A n n u a l R e s u l t s f o r t h e y e a r e n d i n g 3 1 st D e c e m b e r 2 0 2 2 1
Slide 2: 2022
2022
Slide 3: Agenda
• 2022 business highlights R E S U L T S • Strategic progress made to date AGENDA • 2023-2025 plan and targets A N N U A L • 2022 Financial performance 2 0 2 2 • Questions 3
Slide 4: 2022 Business Highlights
R E S U L T S 2022 BUSINESS HIGHLIGHTS AAN PDRSE STERNATTAETG I OI N C TPOR O X GRESS MADE TO DATE A N N U A L 2 0 2 2 JAMES CLIFTON, CEO 4
Slide 5: Summary
• Strong revenue growth driving scale R E S U L T S • Investment in our people, our primary asset 2022 • Investment in new margin enhancing offers A N N U A L • Arrested cash burn on non-core SUMMARY • Created a strategy for sustainable revenue and margin growth that will be realised over 2 0 2 2 th
Slide 6: Top-line Business Performance
• Revenue up 10% on 2021 • Outperformed consensus Industry growth rate • Strong H2 • Client retention statistics remain excellent: R E S U L T S 2022 • 47%+ from Clients of more than 5 yrs • 29% from 10+ yrs TOP-LINE BUSINESS A N N U A L PERFORMANCE • Headline Operating Profit up 8% 2 0 2 2 • Margin
Slide 7: Strategic Points of Note
• Consolidated Story and Chapter to form Story Group • Successful courting and acquisition of Livity, R E S U L T S Populate, Mezzo Labs and Influence 2022 • Innovative thinking to create Turbine STRATEGIC A N N U A L • Expanding the successful MISSION Made to MISSION Advantage POINTS OF NOTE • Crea
Slide 8: Strategic Points of Note
• Appointed a renowned industry figure as our new Non-Executive Director & Deputy Chair, Mark Lund, which has led to the completion of the Board restructure (Appendix 1.) R E S U L T S • Delivered our first ever ESG Report and 2022 demonstrated Leadership and Championing of STRATEGIC the initiative
Slide 9: 2022 Context
2022 CONTEXT NOT THE YEAR THE INDUSTRY EXPECTED FOR A NUMBER OF WELL PUBLICISED REASONS Resulting in a strange new business market: R E S U L T S A N N U A L 2 0 2 2 • Which is why Group New Business wins totalling over £13m is a great achievement • Otonomix, Linked in, ServiceNow, BMW Japan, Simply
Slide 10: Outstanding Organic Client Growth
OUTSTANDING ORGANIC CLIENT GROWTH By Client: By Sector: Revenue £'000s % share of total Client 2022 2021 growth revenue R E S U L T S 1 6,918 4,809 43.9% Sector 2022 2021 2 6,517 4,947 31.7% Property 24% 26% 3 3,709 2,897 28.0% Tech 23% 21% 4 2,335 1,724 35.4% Healthcare 14% 11% A N N U A L 5 1,368
Slide 11: Events and US Lead the Way in 2022
EVENTS AND US LEAD THE WAY IN 2022 By mix: By geography: £'000s 2022 2021 growth R E S U L T S £'000s 2022 share 2021 share growth UK 67,766 63,160 7% Ad&Digi 62,045 78% 57,388 79% 8% PR 7,179 9% 6,973 10% 3% USA 9,156 6,425 43% Asia 2,667 2,720 -2% A N N U A L Events 6,255 8% 4,829 7% 30% Media 4,3
Slide 12: 2022 Operational Challenge
2022 OPERATIONAL CHALLENGE • Managing an increasing staff cost due to talent and inflationary pressures • Revenue per head broadly back to pre-pandemic levels (2019) • Need to continue to drive an improvement in Revenue per head in 2023 and beyond R E S U L T S 100 A N N U A L 90 2 0 2 2 80 70 60 50
Slide 13: ESG Is a Journey, Not a Destination
R E S U L T S C R E D S ESG IS A JOURNEY, 2 0 2 3 G R O U P 2 0 2 2 A N N U A L NOT A DESTINATION We are focused in ensuring robustness in our reporting, challenging ourselves to meet progressive and impactful targets and holding the whole Group to account in changing behaviours and adopting sustain
Slide 14: 2022 ESG Progress
2022 ESG PROGRESS R E S U L T S A N N U A L 2 0 2 2 912 HOURS OF PRO BONO SUPPORT 120 VOLUNTEERING DAYS 14
Slide 15: ESG 2023
Continue to measure and report social 1 & environmental impacts and hold ourselves accountable to drive focus. Embed sustainability in our decision R E S U L T S 2 making and better align all elements of C R E D S our ESG activity. ESG 2023 2 0 2 3 G R O U P 2 0 2 2 A N N U A L Support our clients i
Slide 16: 2023-25 Plan and Targets
2023-25 PLAN AND TARGETS R E S U L T S How do we better meet the needs of current and future Clients? How do we drive greater value from the A PRESENT ATION r e vT e nOu e Xw e g e n e r a t e ? A N N U A L Having established there is one how do we 2 0 2 2 cement and harness the role of the MISSION?
Slide 17: The Plan
THE PLAN H E A D L I N E O P E R A T I N G P R O F I T ( £ M ) 14 47% CAGR 12 R E S U L T S INVEST & REBUILD 10 A N N U A L CONSOLIDATE & 8 REALISE 2 0 2 2 6 4 2 0 2020 2021 2022 2023 2024 2025 CONSENSUS FORECAST AS AT 28.03.23 17
Slide 18: Some of Our Beliefs
SOME OF OUR BELIEFS • Promote your specialism (capability) and not your business • Our knowledge and expertise of your sector can improve your business and not ‘look what I have’ • Savvy Clients will continue to fuel growth • “when times are good you should advertise. When times are bad you must adv
Slide 19: A Clear Go To Market Strategy
R E S U L T S A CLEAR GO TO MARKET STRATEGY A N N U A L CONSISTENTLY & REPEATEDLY TOLD 2 0 2 2 DO NOT COMPLICATE OR DEVIATE! 19
Slide 20: Vision
R E S U L T S To be the preferred VISION creative partner A N N U A L for real business growth. 2 0 2 2 20
Slide 21: Mission
R E S U L T S MISSION A N N U A L Everything we do is designed to get to work that makes the difference Clients 2 0 2 2 are looking for, whatever their ambition. 21
Slide 22: Method
OVER 1,100 19 AGENCIES PEOPLE R E S U L T S A collective of Agencies that cover all touchpoints and disciplines METHOD A N N U A L supported by centrally delivered capabilities and incremental services to widen and deepen Client relationships. 2 0 2 2 28 3 LOCATIONS CONTINENTS 22
Slide 23: Agencies
2 0 2 2 A N N U A L R E S U L T S AGENCIES 23
Slide 24: The Mission
THE MISSION TO be the preferred creative partner for real business growth BY delivering Work that Counts TECHNOLOGY HEALTH BUSINESS CONSUMER SPORTS & & MOBILITY & WELLNESS & CORPORATE & LIFESTYLE ENTERTAINMENT MISSION ADVANTAGE MISSION COMMERCIAL 24
Slide 25: Technology & Mobility / Health
TECHNOLOGY HEALTH BUSINESS CONSUMER SPORTS & & MOBILITY & WELLNESS & CORPORATE & LIFESTYLE ENTERTAINMENT 25
Slide 26: Technology & Mobility
Global tech spend will reach $4.4 trillion in 2023 as the media, businesses, and governments continue to invest heavily in new technology. Companies are also R E S U L T S C R E D S TECHNOLOGY embedding sustainability as a core 2 0 2 3 G R O U P 2 0 2 2 A N N U A L value for new tech adoption and &
Slide 27: We know our audiences better than anyone
We know our audiences better than anyone. We 1 delivered over £2 billion in sales qualified opportunities to our Clients in 2022 alone. We are experts in activating and mobilising brands’ 2 networks using our distributed marketing platform Cortex which is present in all 5,000 Motability dealerships
Slide 28: Health & Wellness
The pharma industry faces a series of serious challenges - new modalities, pressure to innovate, shifting power R E S U L T S HEALTH dynamics, and an explosion of digital A N N U A L and analytics tools. But there is & WELLNESS everything to play for. The global 2 0 2 2 wellness market is worth more
Slide 29: Health & Wellness client examples
Drove to relieve pressure on the healthcare system in 1 women’s health by framing the GP HRT consultation around 2-6 guiding questions, greatly increasing treatment rates and reducing referral delay. Combined global health and human insight to help NTUC 2 Health (Singapore’s largest wellness provide
Slide 30: Business & Corporate
The global B2B market will grow 11.8% annually to reach $48 trillion R E S U L T S BUSINESS by 2030, six times larger than the B2C A N N U A L market according to Straits Research. & CORPORATE As businesses globally transition 2 0 2 2 towards net zero, a sustainability mindset will be critical to su
Slide 31: Business & Corporate client examples
1 Top 5 UK B2B marcomms Agency (2022). 2 We have helped the Department for International Trade boost investment in the UK by over £10 Bn and created over 30,000 jobs. 3 Successfully delivered integrated campaigns for some of the world’s largest B2B businesses R E S U L T S - Powered Castrol’s wind e
Slide 32: Consumer & Lifestyle
Customer expectations from brands are changing. Consumers move rapidly between mindsets for different products R E S U L T S CONSUMER and companies need to keep up with A N N U A L their changing moods. And despite a & LIFESTYLE cost-of-living crisis, people still want to 2 0 2 2 spend. It’s the com
Slide 33: Consumer & Lifestyle client examples
1 Digital first campaign for Speedo, ‘Swim United’, reached over 13 million people and empowered 1,250 children from marginalised backgrounds to learn to swim. The business re-engineering of Ardbeg Whisky took 2 them from a mothballed distillery to No.1 selling malt R E S U L T S whisky globally in
Slide 34: Sports & Entertainment
The global sports sponsorship market totalled USD 77.69 billion in 2022 and is projected to grow at a CAGR of 8.32% to C R E D S SPORTS & reach USD 116.17 billion by 2027. G R O U P Growth has consistently outstripped ENTERTAINMENT traditional marketing over the past 20 2 0 2 3 years – it will only
Slide 35: Sports & Entertainment agency strengths
A specialist sports and entertainment Agency founded by 1 the marketing leaders that established the like of Formula 1, the WTA and ATP Tours and London Fashion Week as global sponsorship platforms. 2 The only sports and entertainment Agency with a dedicated social media specialist Agency working at
Slide 36: Mission Advantage / Mission Commercial
MISSION ADVANTAGE MISSION COMMERCIAL 36
Slide 37: Mission Advantage
A portfolio of strategic services built to drive positive change and dramatically extend the scale and scope of our offer. R E S U L T S Teams of experts in HR, global digital production, data science and research, regional expansion and promotion - positioned around the globe and A N N U A L ready
Slide 38: Brand Bonding Index
BRAND BONDING INDEX VALUE/ CONSUMER BRAND MOTIVATION PROFILING PERSPECTIVE MINDSET R E S U L T S ENGAGEMENT MAPPING SCORE A N N U A L 2 0 2 2 360 CUSTOMER DIGITAL EMISSIONS INSIGHTS SCORE MEANINGFUL DISTRIBUTED MARKETING JOURNEY METRICS PLATFORM
Slide 39: Mission Commercial
Facilities management & IT & systems administration An array of cost-effective, shared provisions designed to deliver scalable, best-in-class support services and expertise to our Agencies. R E S U L T S MISSION Commercial incorporates teams across Facilities management & administration, IT & system
Slide 40: Revenue Splits
REVENUE SPLITS TECHNOLOGY HEALTH BUSINESS CONSUMER SPORTS & & MOBILITY & WELLNESS & CORPORATE & LIFESTYLE ENTERTAINMENT MISSION ADVANTAGE 40
Slide 41: 2022 Revenue Split
2022 REVENUE SPLIT TECHNOLOGY HEALTH BUSINESS CONSUMER SPORTS & & MOBILITY & WELLNESS & CORPORATE & LIFESTYLE ENTERTAINMENT 22% 5% 26% 40% 4% 3% MISSION ADVANTAGE 41
Slide 42: 2023-2025 Targets Strategy
2023 – 2025 TARGETS STRATEGY DRIVE SCALE whilst leveraging SYNERGY from the R E S U L T S £100m REVENUE central platforms OP MARGIN INCREASED TO 13% A N N U A L HEADLINE OPERATING PROFIT OF £13m %age revenue growth rate outstrips expenditure due 14% CAGR (v 2022) to EFFICIENCY of MISSION Advantage &
Slide 43: 2022A Financial Performance
R E S U L T S 2022A FINANCIAL PRESENTATION TO X PERFORMANCE A N N U A L GILES LEE, CFO 2 0 2 2 43
Slide 44: Profit & Loss (£m)
PROFIT & LOSS ( £ M ) % • Revenue up 10% on 2021 2022 2021 £ change • Strong H2 – up 10% on H2 2021 BILLINGS 182.7 153.3 29.4 • Client retention statistics remain excellent: REVENUE 79.8 72.5 7.3 10% • 47%+ from Clients of more than 5 yrs • 29% from 10+ yrs, 19% from 20+ yrs OPERATING EXPENSES (71.1
Slide 45: Adjustments
ADJUSTMENTS 2022 2021 SPLASH £2.4m - Restructure costs & goodwill impairment R E S U L T S PATHFINDR £2.9m - Impairment of R&D & inventory costs to date A N N U A L START-UPS £0.8m £0.4m Livity, Turbine, Data, Health 2 0 2 2 M&A COSTS £0.9m (£0.2m) Amortisation, Prof fees, changes to AC RESTRUCTURE
Slide 46: Balance Sheet (£m)
BALANCE SHEET ( £ M ) ACQUISTION OBLIGATIONS WELL PLACED Acquisition Obligations £m 14.0 12.0 2022 2021 10.0 8.0 INTANGIBLES 99.7 99.0 6.0 FIXED ASSETS/INVESTMENTS 2.5 2.6 4.0 WORKING CAPITAL 5.4 6.9 2.0 R E S U L T S 0.0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 NET
Slide 47: Net Bank Debt Movement (£m)
NET BANK DEBT MOVEMENT ( £ M ) Net Bank Debt Strong Op cash generation: 12.0 0.8 11.4 • £9.7m inflow 0.5 10.3 9.7 1.9 • £1.1m working capital inflow 10.0 R E S U L T S • Working cap days reduced to 9 8.0 2.9 days (2021: 15 days) • c£2.0m of Client pre-payments held at 31/12/22 A N N U A L 6.0 £m 1.6
Slide 48: Cash Flow (£m)
CASH FLOW ( £ M ) 2022 2021 HEADLINE OPERATING PROFIT 8.7 8.0 ADD BACK DEPRECIATION 3.3 3.6 EFFICIENT OPERATING LESS LEASE PAYMENTS (1.9) (2.0) CASH CONVERSION EBITDA 10.1 9.6 R E S U L T S INTEREST AND TAX (1.5) (2.1) Operating Cashflow/Headline Operating Profit NORMALISED OPERATING CASH FLOW 8.6 7
Slide 49: Progressive Dividend Strategy
PROGRESSIVE DIVIDEND STRATEGY DPS progression (p) 3.0 2022: Final dividend of 1.67p proposed. R E S U L T S Total dividend 2.50p, up 4% on 2021 2.5 2.7x cover on Headline Diluted EPS (per 2021) 2.0 A N N U A L 1.5 2 0 2 2 1.0 0.5 0.0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 49
Slide 50: Summary & Outlook
• 2022 • Strong revenue growth driving scale • Investment in our people, our primary asset • Investment in new margin enhancing offers • Arrested cash burn on non-core R E S U L T S SUMMARY • 2023 to 2025 A N N U A L • Drive scale whilst leveraging synergy from the central & OUTLOOK platforms • %age
Slide 51: Thank You
THANK YOU JAMES CLIFTON, GROUP CEO JCLIFTON@THEMISSION.CO.UK 07825 860167 GILES LEE, GROUP CFO GLEE@THEMISSION.CO.UK 07730 490384 51
Slide 52: Appendix 1
R E S U L T S APPENDIX 1. A PRESENTATION TO X A N N U A L MISSION PLC BOARD STRUCTURE EFFECTIVE 01.01.23 2 0 2 2 52
Slide 53: The Mission Group plc Board
THE MISSION GROUP PLC BOARD MARK LUND JULIAN HANSON SMITH DR ELIZA FILBY Non-Exec Deputy Chair Non-Exec Chair Non-Exec Director Industry Specialist Finance and governance Social and consumer insight R E S U L T S Audit & Risk Chair Nominations chair Remuneration chair A N N U A L JAMES CLIFTON Group