Adslot Ltd · ASX:ADS
Adslot — Shareholder Meeting (November 2015)
46 slides from Adslot's shareholder meeting presentation, Nov 27, 2015
Slide 1: Adslot AGM CEO Presentation
Adslot AGM CEO Presentation 27th November 2015 Melbourne, Australia (ASX:ADJ)
Slide 2: Agenda
Agenda • State of the Media Industry • Adslot’s Strategy • Outlook
Slide 3: State of the Media Industry
State of the Media Industry
Slide 4: The Ad Market
The Ad Market • Global advertising, a USD $700b market • Online advertising, a USD $150b segment and the growth engine of the global advertising economy Source: PWC
Slide 5: The Market
The Market In turn, online advertising breaks down into three core segments: 1. Search advertising (a USD $62.5b market) 2. Classifieds advertising (a USD $15.1b market) 3. Display advertising ( a USD $66.2b market) Source Zenith Optimedia
Slide 6: The Market
The Market • The $700b media industry has until recently had very little purpose-built technology to automate and enhance interaction between buyers and sellers • This is changing, and online advertising is the driver Search advertising Classifieds advertising Display advertising Traded entirely via
Slide 7: The Market
The Market The online display advertising market comprises two sub- segments: 1. Forward guaranteed – a USD $51b market. Guaranteed price, guaranteed volume of impressions, guaranteed timeframe and guaranteed placement. 2. Real Time Bidding (RTB) – a USD $15b market. Unsold inventory, auctioned in r
Slide 8: The $15b RTB segment is traded entirely via platforms
The $15b RTB segment is traded entirely via platforms: purpose built technology that automates the interaction between buyer and seller…at scale
Slide 9: The $51b forward guaranteed segment is traded via manual spreadsheets
The $51b forward guaranteed segment is traded almost entirely via manually produced spreadsheets and purchase orders…
Slide 10: 28% of budgets are lost vs 2% for Television
…creating inefficiencies that are unsustainable 28% of budgets are lost in non value generating administration costs VS 2% for Television
Slide 11: Shifting focus from value and performance to administration
…shifting focus from value and performance …to administration and process
Slide 12: While constraining growth: a $35B gap
…while constraining growth A $35B gap the forward guaranteed market’s share of this is worth $11B Source Zenith Optimedia
Slide 13: The inefficiency of the forward guaranteed market creates a huge opportunity
The inefficiency of the $51b forward guaranteed market creates a huge opportunity…
Slide 14: Adslot's vision
Adslot’s vision: To become the world’s leading provider of trading automation technology for the forward guaranteed market
Slide 15: Welcome to Adslot...
Welcome to Adslot...
Slide 16: Automation is inevitable, and it's here (IAB)
Automation is inevitable, and it’s here In CY2015 automation of the forward guaranteed display market became a reality The industry is paying attention IAB Helps Push the Growth of Automated Guaranteed Buying with Release of "OpenDirect 1.0” “Today the Interactive Advertising Bureau (IAB) released "
Slide 17: Automation is inevitable, and it's here (analysts)
Automation is inevitable, and it’s here In CY2015 automation of the forward guaranteed display market became a reality Analysts are paying attention "Spending managed on programmatic platforms will grow more than six-fold in the United States by 2019. Most of that growth will take place in the autom
Slide 18: Automation is inevitable, and it's here (technology providers)
Automation is inevitable, and it’s here In CY2015 automation of the forward guaranteed display market became a reality Other technology providers are paying attention “Automating guaranteed direct orders facilitates the buying and selling of the most premium, higher priced inventory directly between
Slide 19: The world's leading media buying groups & agencies
The world’s leading media buying groups & agencies…
Slide 20: On behalf of some of the world's leading advertisers
On behalf of some of the world’s leading advertisers
Slide 21: ...are adopting Adslot technology
…are adopting Adslot technology In September Quarter (2015) the value of media traded via Adslot grew by 74% QoQ ”Automated Guaranteed allows our clients to reserve our premium inventory whilst removing inefficiencies that direct sales often bring. The integration with the Adslot platform has been sl
Slide 22: ...and they are coming back for more
…and they are coming back for more • The average value of media traded per transaction continues to climb as adoption builds • In aggregate (across all markets), the average value of media traded per transaction increased by 78% in the September Qtr to over AUD $27,000
Slide 23: Where are we now and what can we expect in CY16?
Where are we now and what can we expect in CY16? • CY15 established that automation of the forward guaranteed market – Automated Guaranteed – is here to stay and has a bright future • CY15 was a year of ‘market development’, where our sales & marketing effort was focused on: – Creating awareness - h
Slide 24: Where are we now and what can we expect in CY16?
Where are we now and what can we expect in CY16? • CY16 will see a transition from the market development phase to the business development phase – The migration of skills, hierarchies, organisations and media spend to ‘platforms’ and ‘automation’ is structural – the timeline for the market developm
Slide 25: In Summary...
In Summary… • The $51b forward guaranteed display advertising market has validated the need for automation • As awareness translates to adoption, and adoption accelerates, we are seeing a shift from the market development phase to a business development phase • The increase in trading activity via A
Slide 26: Adslot's Strategy
Adslot's Strategy Adslot.
Slide 27: Remained laser focused on executing our strategy
Over the last 12 months we have remained laser focused on executing our strategy 1. Grow the demand captured via Symphony Adslot’s market leading workflow automation technology for media buyers, Symphony is used by some of the largest media agencies in the world and now captures AUD $2.5b of media sp
Slide 28: 1. Grow the demand captured via Symphony
We have remained laser focused on executing our strategy 1. Grow the demand captured via Symphony • Major new contracts secured in FY15 (Starcom, Haworth, Goldbach) • Further wins secured 1H FY16 • Over AUD $2.5b of annualised demand now executed via Symphony • Major agency clients in APAC, Europe a
Slide 29: 2. Build out our coalition of partners
We have remained laser focused on executing our strategy 2. Build out our coalition of partners In the past 12 months Adslot have signed partnerships with 2 of the world’s top 10 online publishers, and 2 of the world’s leading publisher technology platforms • Top 10 world’s • One of the fastest • Th
Slide 30: 3. Integrate the automated trading experience into Symphony
We have remained laser focused on executing our strategy 3. Integrate the automated trading experience into Symphony • Successful phase 1 release: August 2014 • Successful phase 2 release: April 2015 • First trading activity captured
Slide 31: 4. Extend our value proposition from efficiency to efficiency+effectiveness
We have remained laser focused on executing our strategy Real time 4. Extend our value proposition from efficiency to efficiency+effectiveness collaboratio n Campaign Optimisatio n Viewability
Slide 32: Whilst maintaining revenue growth...
Whilst maintaining revenue growth… • Trading Technology is the primary +69% -2% +55% growth engine with a 69% increase on pcp, and is now the largest revenue segment for the Group Trading • Non-strategic Services revenue was flat Technology Services Adserving with only a small (2%) decrease on pcp $2
Slide 33: Managing costs to improve profit performance
managing costs to improve profit performance… • Operating costs decreased slightly from $10.794m to $10.628m – a reduction of -2%Costs Operating +32% EBITDA +9% NPAT $0.166m or 2% on pcp, demonstrating $5.094m ($1.762m) ($5.233m) cost management discipline • EBITDA loss reduced from of a loss of Oper
Slide 34: ...and improving cash outflow
…and improving cash outflow • Receipts from Trade and Other Creditors +73% -43% +32% grew 73% YoY, from $4.774m to $8.279m. • 43% improvement in Net Cash Outflows from Operating Activities, reduced from Net Cash ($5.607m) in FY14 to ($3.176m) in FY15. Outflows from Cash • Continued investment in our Te
Slide 35: Outlook
Outlook Adslot.
Slide 36: Outlook: partners activated via live integrations
Outlook Adslot partners will be activated via live integrations • The leading global industry body IAB will shortly release a universal technical standard for Automated Guaranteed • The IAB standard will reduce integration complexity, risk and timeframes – allowing Adslot and it’s partners to integr
Slide 37: Outlook: Symphony-Adslot integration
Outlook The Symphony-Adslot integration will drive a further lift in trading activity • Our integration roadmap includes major feature releases and enhancements • Media buying groups such as Omnicom and Publicis have mobilised to trade more significantly via the integration • New agency clients are s
Slide 38: Outlook: continue to innovate
Outlook Adslot will continue to innovate to maintain it’s best in class status • Investment data and campaign performance data will be integrated to provide meaningful insights and inform trading decisions • More complex ad units will be supported • More inventory sources (publisher adservers) will
Slide 39: Outlook – Other Key Strategies
Outlook – Other Key Strategies Grow Symphony’s share of the forward guaranteed market The more demand captured via Symphony, the stronger the Company is positioned as media buying groups move their trading activity to ‘platforms’ Bring intelligent audience trading into the platform, at scale As medi
Slide 40: Outlook – Revenue by Segment
Outlook – Revenue by Segment Trading activity is expected to lift, driving further growth in Trading Technology revenues • The forward guaranteed market’s growing adoption of trading technology will continue in CY16 • Growth in Adslot’s Trading Technology revenue will continue to outpace a gradual d
Slide 41: Outlook - Trading Technology Revenue by Sub-Segment
Outlook - Trading Technology Revenue by Sub-Segment Trading Technology revenues for the current half are on track to exceed the prior half • Licence Fees and Trading Fees are both growing • Trading Fee revenue constitutes a smaller % of the Trading Technology segment total, and for now is less predi
Slide 42: Outlook - Revenues
Outlook - Revenues The December Half is on track to exceed the prior half by approximately 32% • Trading Technology growth is accelerating: – 2H FY14 to 1H FY15: 7% – 1H FY15 to 2H FY15: 17% – 2H FY15 to 1H FY16: 32% (projected)
Slide 43: Trading Fee Revenue vs Trading Activity
Trading Fee Revenue vs Trading Activity • Trades are made between 2 days and 4 months in advance of the campaigns that are purchased being published! • Revenues are recognised in Adslot accounts only when the advertising activity purchased has been published! • Invoices are generated monthly in arre
Slide 44: Outlook - Cashflows
Outlook - Cashflows The Company’s cash position funds the current business plan The Board continues to closely monitor capital reserves to balance: • An ongoing focus on revenue growth and cost control to optimise cashflows • Ensuring the Company is able to continue to realise the significant opportuni
Slide 45: Summary
Summary • The media industry has validated both our technology and the opportunity it creates • Adoption is growing…and is expected to accelerate • Revenue growth is expected to continue and accelerate • The Company has built a highly strategic position by: – Continually growing the pool of demand s
Slide 46: Thank you
Thank you @adslot investor.relations@adslot.com