Slide 1: Management Presentation First Quarter 2012 Results
Management Presentation May 3, 2012 First Quarter 2012 Results Draft
Slide 2: Forward-looking statements
This presentation, including our “2012 Financial Outlook”, contains forward-looking statements. The Company’s representatives may also make forward-looking statements orally from time to time. Statements in this presenta tion that are not historical facts, including statements about t he Company’s b
Slide 3: Key Highlights
KEY HIGHLIGHTS • Q1 2012 organic revenue growth of 5.4% • Q1 2012 revenue increased 9.7% to $236.0 million versus $215.1 million in Q1 2011 • Q1 2012 EBITDA decreased 51.4% to $7.5 million versus $15.4 million in Q1 2011 • Severance expense impacted the quarter by $2.2 million, which combined with e
Slide 4: Consolidated Revenue and Earnings
CONSOLIDATED REVENUE AND EARNINGS Note: Actuals may not foot due to rounding (US$ in millions, except percentages) 2012 2011 Revenue 236.0$ 215.1$ 9.7 % Operating Expenses Cost of services sold 177.3 157.8 12.4 % Office and general expenses 60.4 44.5 35.8 % Depreciation and amortization 10.0 10.3 (2
Slide 5: Summary of Segment Results - Revenue
SUMMARY OF SEGMENT RESULTS -REVENUE • Solid organic growth despite difficult comparisons • New business wins driving market share gains • Acquisitions and investments bolstering financial performance (US$ in millions, except percentages) 2012 2011 Revenue Strategic Marketing Services 160.4$ 141.5$ 1
Slide 6: First Quarter 2012 Revenue Growth by Segment
FIRST QUARTER 2012 REVENUE GROWTH BY SEGMENT Strategic Performance Weighted Marketing Marketing Average Services Services Total Organic Growth 8.7% -1.0% 5.4% Acquisition Growth 5.0% 4.0% 4.7% Foreign Exchange Growth -0.3% -0.4% -0.4% Total 13.4% 2.7% 9.7%
Slide 7: First Quarter Revenue by Client Sector
FIRST QUARTER REVENUE BY CLIENT SECTOR Note: Actuals may not foot due to rounding Q1 2012 Q1 2011 Retail, 15% Communications, 12% Other, 15% Financials, 8% Consumer Products, 32% Technology, 11% Healthcare, 4% Auto, 3% Retail, 15% Communications, 13% Other, 12% Financials, 9% Consumer Products, 32%
Slide 8: Outperformance Despite More Difficult Comparisons
Outperformance Despite More Difficult Comparisons Note: Peers include Omnicom, Interpublic, WPP Group, Havas and Publicis for 1Q08-1Q12 ORGANIC GROWTH 1Q12 +5.4% MDC Partners vs. Peers Trailing 12 Month Organic Revenue -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 1Q082Q083Q084Q081Q092Q093Q094Q091Q
Slide 9: Summary of Segment Results - EBITDA
SUMMARY OF SEGMENT RESULTS -EBITDA Note: Actuals may not foot due to rounding (US$ in millions, except percentages) 2012 2011 EBITDA Strategic Marketing Services 10.0$ 15.0$ (33.4) % margin 6.2% 10.6% Performance Marketing Services 2.6 4.2 (39.4) % margin 3.4% 5.8% Marketing Communications 12.5 19.2
Slide 10: Free Cash Flow
FREE CASH FLOW Note: Actuals may not foot due to rounding (US$ in millions) 2012 2011 EBITDA $7.5 $15.4 Net Income Attibutable to Noncontrolling Interests (1.4) (1.6) Capital Expenditures (4.6) (4.9) Cash Taxes (0.0) (0.1) Cash Interest, net & other (9.4) (8.4) Free Cash Flow ($7.9) $0.5 Three Month
Slide 11: Liquidity
LIQUIDITY *Note: At March 31 2012, after giving effect to the limitationsunder the 11% Senior Notes indenture, approximately $138.0 million was available under the bank credit facility. (US$ in millions) Commitment Under Facility 150.0$ Drawn 23.9 Letters of Credit 5.7 Funds Available Under Facility
Slide 12: 2012 Financial Outlook
2012 FINANCIAL OUTLOOK Implied 2012 Year over Year Guidance Change Revenue $1,050 - $1,075 million +11.3% to +14.0% EBITDA $110 - $115 million +21.2% to +26.7% Free Cash Flow $35 - $40 million +50.8% to +72.3% + Change in Working Capital and Other +$25 million Total Free Cash Flow $60 - $65 million
Slide 13: Appendix
APPENDIX
Slide 14: Temporal Put Obligations and Impact on EBITDA
TEMPORAL PUT OBLIGATIONS AND IMPACT ON EBITDA Note: Excludes put rights of $79.4 million exercisable pursuant to termination of employment or death. Incremental (US$ in millions) Cash Stock Total EBITDA in Period 2012 3.1 0.3 3.4 3.1 2013 9.8 0.6 10.4 1.1 2014 3.7 0.9 4.6 1.3 2015 3.4 0.5 3.9 1.3 Th
Slide 15: Balance Sheet: 2016 Senior Notes
BALANCE SHEET: 2016 SENIOR NOTES Principal Amount $345 Million Date November 1, 2013 at 105.00% November 1, 2014 at 102.75% November 1, 2015 and thereafter at 100.00% Maturity November 1, 2016 Security Unsecured Coupon 11% Ratings Moody’s -Corporate: B1; Notes: B2 S&P: Corporate: B+; Notes: B+ Princ
Slide 16: Balance Sheet: Revolving Credit Facility
BALANCE SHEET: REVOLVING CREDIT FACILITY Amount $150 Million Type Senior Secured Maturity October 23, 2015 Facility Fee 50bps per annum Drawn Rate Prime +225bps / LIBOR +250bps Covenants •Minimum EBITDA: $93.4 million •Fixed Charge Coverage Ratio: 1.10:1.0 •Senior Leverage Ratio: 2.0:1.0 •Total Leve
Slide 17: Summary of Cash Flow
SUMMARY OF CASH FLOW Note: Actuals may not foot due to rounding (US$ in millions) 2012 2011 Cash flows (used in) provided by continuing operating activities $12.4 ($37.1) Discontinued operations 0.1 0.1 Net cash (used in) provided by operating activies $12.5 ($37.1) Cash flows (used in) provided by
Slide 18: Definition of Non-GAAP Measures
DEFINITION OF NON-GAAP MEASURES • EBITDA: EBITDA is a non-GAAP measure, that represents operating profit plus depreciationand amortization, stock- based compensation, acquisition deal costs, deferred acquisitionconsideration adjustments and profit distributions from affiliates. • Organic Growth: Org