Enero Group Limited · ASX:EGG
Enero — H1 FY2022 Earnings Presentation
33 slides from Enero's earnings presentation, Feb 17, 2022
Slide 1: 2022 Half Year Results Announcement
Enero Group Limited ABN 97 091 524 515 Level 2, 100 Harris Street Pyrmont NSW 2009 Australia ASX ANNOUNCEMENT 2022 Half Year Results Announcement For personal use only Enero growth momentum continues with FY22 H1 revenue up 15% and Operating EBITDA growth of 23% (29% on an underlying basis). 17 Febr
Slide 2: Business Operating Performance (announcement continued)
creativity agency in Australia and number three in the world by one of the most prestigious global rankings, WARC’s Effective 100.” For personal use only “In addition, we are seeing the benefits of our FY21 acquisition of McDonald Butler by Hotwire UK, with its fully integrated client proposition an
Slide 3: Trading Update and Investor Conference Call
Trading Update: • Enero continues its track record of sustainable revenue and EBITDA growth. For personal use only • FY22 H2 has started off with strong growth in the US and a solid performance in Australia and UK/Europe. • We remain focused on maintaining Enero’s high margins across our strong and
Slide 4: Enero Group FY22 Half Year Results February 2022
For personal use only Enero Group FY22 Half Year Results 17 February 2022 1
Slide 5: Agenda
Agenda For personal use only Business Performance & Strategy Overview Trading Update Group Financials Q&A 2
Slide 6: Business Performance & Strategy Overview
For personal use only Business Performance & Strategy Overview Brent Scrimshaw - CEO 3
Slide 7: Delivering on our strategy
Delivering on our strategy For personal use only STRATEGIC PRIORITIES + + + TALENT CAPABILITY PRODUCTIVITY INNOVATION Enhance leadership Undertake M&A to Implement technology Create an innovation and diversify skillsets strengthen current and processes to engine to drive new to drive organic portfol
Slide 8: Group Trading Performance
Group Trading Performance For personal use only HIGHLIGHTS • Operating EBITDA growth of 23.3% YoY. Adjusting for impact of JobKeeper in FY21 H1, operating EBITDA growth of 29.0% ($M) FY22 H1 FY21 H1 % Change • NPAT growth of 3.3% impacted Net revenue 93.2 81.0 15.1% by: - Higher tax rate due to full
Slide 9: Track record of sustainable growth continues
Track record of sustainable growth continues For personal use only HIGHLIGHTS • Net revenue has grown both organically and through GROWING NET REVENUE (A$M)* GROWING OPERATING EBITDA (A$M) AND MARGIN (%)* acquisitions over the past 5 years. Acquisitions include McDonald Butler Associates (MBA) in FY
Slide 10: FY22 H1 performance builds on strong FY21
FY22 H1 performance builds on strong FY21 For personal use only NET REVENUE BY HALF YEAR (A$M)* OPERATING EBITDA (A$M) * BY HALF YEAR 90 25 80 +11% +20% 70 20 year-on-year year-on-year 60 15 50 +15% +41% 40 half-on-half half-on-half 10 30 20 5 10 0 0 FY20 H1 FY20 H2 FY21 H1 FY21 H2 FY22 H1 FY20 H1 F
Slide 11: Our global operating model
Our global operating model For personal use only 8
Slide 12: Priority Vertical - Technology
Priority Vertical - Technology Our holistic approach to technology across both operating segments For personal use only BRAND TRANSFORMATION CREATIVE TECHNOLOGY AND DATA Expanding Investment in our relationships with proprietary enterprise technology technology NEW CLIENTS FY22 clients PROGRAMMATIC
Slide 13: Implementing our M&A strategy
Implementing our M&A strategy FY22 Strategic Priorities For personal use only Capability enhancement Innovation Existing Portfolio Brands with opportunity for Global Acceleration Brands global scale and capability Brands with differentiated Enhance and Grow Brands local market leadership Portfolio E
Slide 14: Transforming the Hotwire offering through performance marketing
Transforming the Hotwire offering through performance marketing For personal use only THE REPUTATION RELATIONSHIP REVENUE Drive Reputation Grow Relationships Deliver Revenue OPPORTUNITY Brand strategy, narrative development, Develop relationships with media, Support revenue generation across targete
Slide 15: Client Analysis
Client Analysis For personal use only REVENUE DIVERSIFICATION REVENUE BY INDUSTRY (FY22H1)* REVENUE BY INDUSTRY (FY21H1)* • Strong client diversification with mix of clients across market industries and sectors. Utilities & Energy Telecommunications 1% Telecommunications Utilities & Energy 1% Bankin
Slide 16: Creating repeatable revenue
Creating repeatable revenue For personal use only HIGHLIGHTS • The longevity of clients is reflected in 58% having a duration of 4 years or more, ATTRACTIVE CLIENT LONGEVITY BALANCED REVENUE supported by Enero’s broad CONTRIBUTION* offering of services and capabilities which support client retention
Slide 17: Results by Geography
Results by Geography For personal use only HIGHLIGHTS • Marginally stronger Australian ($M) FY22 H1 FY21 H1 % Change Constant Currency Variance dollar had nominal negative impact on reported Net Net revenue Revenue and Operating EBITDA. USA 39.8 28.9 37.5% 39.1% Australia 35.4 32.7 8.2% 8.2% • Decli
Slide 18: Results by Geography
Results by Geography Geographical contribution from operating companies* For personal use only HIGHLIGHTS • In FY22 H1 international FY22 H1 FY21 H1 operations accounted for 56% of total revenue and 71% of Operating Companies EBITDA. 29% • Strong growth in the US 34% businesses increased their NET 4
Slide 19: USA
USA For personal use only HIGHLIGHTS • Strong revenue performance ($M) with significant margin AS REPORTED FY22 H1 FY21 H1 % Change Constant Currency Variance acceleration. Net revenue 39.8 28.9 37.5% 39.1% • OB Media growth trajectory continues, benefiting from an Operating EBITDA 23.4 15.9 47.4% 4
Slide 20: Australia
Australia For personal use only HIGHLIGHTS • Robust revenue and margin growth year-on-year (excluding ($M) JobKeeper subsidy). AS REPORTED FY22 H1 FY21 H1 % Change Constant Currency Variance • BMF traded strongly with 30% Net revenue 35.4 32.7 8.2% - revenue growth driven by government projects, and
Slide 21: UK and Europe
UK and Europe For personal use only HIGHLIGHTS • Tech sector specialist, MBA, was acquired in April 2021 and fully ($M) integrated into Hotwire UK. AS REPORTED FY22 H1 FY21 H1 % Change Constant Currency Variance • The continuing businesses Net revenue 18.0 19.4 (6.8%) (6.5%) delivered revenue growth
Slide 22: Trading Update
For personal use only Trading Update Brent Scrimshaw - CEO 19
Slide 23: Trading Update
Trading Update For personal use only • Enero continues its track record of sustainable revenue and EBITDA growth. • FY22 H2 has started off with strong growth in the US and a solid performance in Australia and UK/Europe. • We remain focused on maintaining Enero’s high margins across our strong and d
Slide 24: Group Financials
For personal use only Group Financials Carla Webb-Sear, CFO 21
Slide 25: FY22 H1 Group Financial Performance
FY22 H1 Group Financial Performance For personal use only HIGHLIGHTS • 15% year-on-year revenue growth demonstrated ongoing strong Profit and Loss Summary ($M) FY22 H1 FY21 H1 momentum. Net revenue 93.2 81.0 • Staff costs ratio lower at 58% Other income 0.1 1.4 (FY21H1 - 60%) despite Staff costs (54
Slide 26: Segment Results
Segment Results For personal use only Net revenue Operating EBITDA Operating EBITDA margin ($M) FY22 H1 FY21 H1 % Change FY22 H1 FY21 H1 % Change FY22 H1 FY21 H1 Brand transformation 53.8 49.5 8.8% 12.8 11.8 8.5% 23.7% 23.8% Creative technology and data 39.4 31.5 24.9% 21.8 16.2 35.3% 55.5% 51.2% Co
Slide 27: Reconciliation of statutory (4D) to continuing business results
Reconciliation of statutory (4D) to continuing business results For personal use only Statutory FY22 H1 Less Significant excluding Continuing ($M) 4D items significant items Less Disposals businesses Net revenue 93.2 - 93.2 - 93.2 Other income 0.1 - 0.1 - 0.1 Expenses (61.4) - (61.4) - (61.4) Deprec
Slide 28: Reconciliation of statutory (4D) to continuing business results
Reconciliation of statutory (4D) to continuing business results For personal use only Statutory FY21 H1 Less Significant excluding Continuing ($M) 4D items significant items Less Disposals businesses Net revenue 81.0 - 81.0 (4.3) 76.7 Other income 1.4 - 1.4 (0.2) 1.2 Expenses (55.8) - (55.8) 2.8 (53
Slide 29: Balance Sheet
Balance Sheet For personal use only ($M) FY22 H1 FY21 HIGHLIGHTS Cash 56.5 50.7 Trade and other receivables 48.5 46.9 • Increased cash position of Other assets 4.5 4.9 $56.5m due to strong cash Current assets 109.5 102.5 collection at period end and Deferred tax asset 2.2 2.0 increase in non-control
Slide 30: Balance Sheet & Capital Management
Balance Sheet & Capital Management For personal use only HIGHLIGHTS • Contingent consideration balance relates to MBA acquired in April 2021. Maturity profile is over the FY23 to FY25 periods. CASH AND CONTINGENT CONSIDERATION ($M) FY22 H1 FY21 • Actual payments are subject to Contingent considerati
Slide 31: Cash Flow & Working Capital
Cash Flow & Working Capital For personal use only HIGHLIGHTS • Cash conversion at 98% of EBITDA (excludes right-of-use ($M) FY22 H1 FY21 H1 asset depreciation charge) as compared to 137% in FY21H1 Operating EBITDA 29.9 24.3 resulting from expected unwinding working capital. The Right-of-use asset de
Slide 32: Q&A
For personal use only Q&A 29
Slide 33: Disclaimer
Disclaimer For personal use only This document has been prepared by Enero Group Except for any statutory liability which cannot be Limited (Enero) and comprises written materials/slides excluded, each of Enero, its related companies and for a presentation concerning Enero. This is not a their respec