XLMedia Plc · OTC:XLMDF
XLMedia — H1 2018 Earnings Presentation
29 slides from XLMedia's earnings presentation, September 2018
Slide 1: Technology-Driven Performance Marketing
TECHNOLOGY-DRIVEN PERFORMANCE MARKETING September 2018
Slide 2: Disclaimer
DISCLAIMER THIS PRESENTATION (THE “PRESENTATION ”) WHICH HAS BEEN PREPARED BY 4. you will not forward, reproduce or otherwise disclose the contents of this XLMEDIA PLC. (THE “COMPANY) IS FOR INFORMATION PURPOSES ONLY AND DOES document to any person in contravention of FSMA or any other applicable NO
Slide 3: Overview
OVERVIEW o A leading online performance marketing company o Attracting paying users from multiple online & mobile channels and directing them to online businesses in return for performance based payment models o Strong track record of profitable growth and cash generation o Successful entry into per
Slide 4: Our Business Model
OUR BUSINESS MODEL Attracting potential users through our publishing assets and directing to our customers Publishing 55% Online users: 6% Web, mobile, social, … Media Other 40% Approaching Performance potential users through based payment posting ads on different Revenue share / platforms and direc
Slide 5: 2018 Business Progress
2018 Business progress 5
Slide 6: H1 2018 Highlights
H1 2018 HIGHLIGHTS • Current trading on track to meet profit expectations for the full year • Solid performance from our Personal Finance assets, expanded US operations • Preparation for launch into the significant future potential US gambling market • Enhanced our Asia-Pacific presence in the mobil
Slide 7: H1 2018 Highlights – Acquisitions
H1 2018 HIGHLIGHTS – Acquisitions • Completed a series of acquisitions in the period totalling $45.8 million, including: • Leading Finnish informational Gambling websites for a total of $18MIL • WhichBingo.co.uk, one of the UK’s leading online informational portals and comparison sites for online bi
Slide 8: Personal Finance Expansion
PERSONAL FINANCE EXPANSION o Personal finance sector is a strategic growth engine o H1 2018 saw solid performance from our personal finance assets o Expanded our US operations by adding sales and customer service team supporting hundreds of customers o Acquisitions added complementing customers with
Slide 9: Market Dynamics: Regulation
MARKET DYNAMICS: REGULATION There are several regulatory areas affecting the Group’s activities: Online Gambling Personal data Personal finance sector protection sector Enhanced regulation We have implemented Regulation around trend brings both internal guidelines, ads and promotion limitations and
Slide 10: Financial Results
Financial Results 10
Slide 11: Strong Financial Track Record
STRONG FINANCIAL TRACK RECORD Adjusted EBITDA ($ m) Revenues ($ m) $160.0 $137.6 $140.0 $120.0 $103.6 $100.0 $89.2 $80.0 $59.1 $60.0 $50.7 $40.0 $34.5 $47.1 $26.1 $20.9 $34.6 $20.0 $11.2 $28.5 $17.0 $20.9 $4.0 $8.8 $12.5 $13.3 $0.0 2010 2011 2012 2013 2014 2015 2016 2017 H1-2018 Dividends since IPO
Slide 12: Revenue Diversification
REVENUE DIVERSIFICATION Revenues diversification – Revenues diversification – Revenues diversification – Revenues Per users’ geography products customers business model North United America, Kingdom, 19% 11% A, 9% CPI, 15% Other Europe, Gambling, 70% Other Mobile Revshare, 61% 16% Customers B, 6% Ap
Slide 13: Income Statement
INCOME STATEMENT Item (Thousands $) H1 2018 FY 2017 Revenues 59,088 137,632 Cost of revenues 25,567 64,487 Gross Profit 33,521 73,145 Operating Expenses 16,243 32,376 Operating Profit 17,278 40,769 Total adjusted EBITDA* 20,883 47,120 % Adj. EBITDA 35% 34% Finance income (expenses), net (488) (1,424
Slide 14: Segment Performance
SEGMENT PERFORMANCE $70.0 PUBLISHING $62.9 $70.0 MEDIA $66.4 $60.0 $60.0 $50.3 $50.0 $46.1 $50.0 $45.8 $47.6 $38.4 $40.0 $40.0 $30.3 $32.4 $30.0 $25.6 $30.0 $24.0 $23.9 $23.4 $18.8 $20.6 $20.0 $18.3 $20.0 $14.9 $14.2 $20.0 $15.4 $13.8 $10.2 $8.2 $10.1 $8.5 $10.0 $10.0 $5.6 $5.6 $7.1 68% 76% 77% 79%
Slide 15: Cash Flow Statement
CASH FLOW STATEMENT $ ‘ 000 H1-2018 2017 H1-2018 2017 Net income 14,052 31,871 Financing Activities Depreciation, amortisation and impairment 2,788 5,932 Dividend paid to equity holders of the Company (8,000) (15,505) Cost of share-based payment 774 419 Share capital issuance 42,618 - Changes in Wor
Slide 16: Balance Sheet June 2018
BALANCE SHEET 30 JUNE 2018 $ '000 H1-2018 2017 H1-2018 2017 Current assets: Current liabilities: Cash and short term investments 51,311 43,277 Trade payables 9,926 9,813 Trade receivables 17,776 18,950 Current maturity of long-term bank loan 5,475 2,500 Financial derivatives 162 1,425 Other accounts
Slide 17: Growth Strategy
Growth Strategy Our stated strategy is built on the following three pillars: o Diversification o Technology o M&A 17
Slide 18: Growth Strategy – Ongoing Diversification and Investments
GROWTH STRATEGY – ONGOING DIVERSIFICATION AND INVESTMENTS Follow the groups strategic plan of developing high quality assets and media buying skills in regulated gambling regions and new products. Target earnings enhancing acquisitions Complementary assets (adding diversity in geographies, customers
Slide 19: Growth Strategy - Technology
GROWTH STRATEGY - TECHNOLOGY Continue developing our technology infrastructure to accelerate our growth and profitability through efficiency and further enhance our competitive edge Rampix Business Intelligence Centralized Unified Data warehouse management of social to collect data from campaigns, u
Slide 20: Growth Strategy - M&A
GROWTH STRATEGY - M&A Execute acquisitions which both strengthen and expand the Group’s operational footprint Areas of focus o Publishing assets: continue to buy bolt on websites, integrate them into XLM’s existing infrastructure and technology, enjoying benefits of scale o Vertical expansion o Geog
Slide 21: Unrivalled Pedigree in Acquisitive Growth
UNRIVALLED PEDIGREE IN ACQUISITIVE GROWTH Acquisitions of ▪ North American Majority acquisition of Acquisition of Acquisition of Acquisition of Acquisition of Acquisition of domain - USD 0.3m Romanian network ▪ A Poker website- USD 0.1m ▪ Israel-based ▪ Canada-based ▪ UK-focused leading ▪ A leading
Slide 22: Summary and Outlook
SUMMARY AND OUTLOOK 2018 Progress o Focus on recovery of publishing assets o Proactive measure taken to exit low margin activities o Executing on strategic acquisitions Foundations laid for future growth o Leading market position with presence in newly regulated markets o Personal finance sector rep
Slide 23: Any Questions?
Any Questions? 23
Slide 24: Publishing
PUBLISHING o XLMedia owns over 2,300 informational websites, mobile sites and apps engaging millions of users $70.0 $62.9 in 18 languages $60.0 o Our informational websites attract potential $50.3 customers and refer them to online and mobile $50.0 $46.1 customers $38.4 $40.0 o Some assets rank for
Slide 25: Media
MEDIA $70.0 $66.4 o XLMedia acts as an advertiser running USD ‘000 thousands of simultaneous self-funded $60.0 campaigns, in different verticals. Customers pay $50.0 $45.8 $47.6 based on performance $40.0 o XL deploys proprietary technology to manage $30.0 $23.4 media campaigns across all ad units:
Slide 26: User's Journey
USER’S JOURNEY High ranking XLMedia property Users search for specific information User search results Users directed to client Revshare / CPA / … Users browse web/mobile/social/… XLMedia posts ads Users directed to client 26
Slide 27: Optimization Cycle
OPTIMIZATION CYCLE Quality content Asset optimisation Place Brands Send users Big Data Gather data Target Proprietary tracking, data and analysis tools Send users XLM self-funded Bid on ads Place Brands campaigns 27
Slide 28: The Future of Online Marketing
THE FUTURE OF ONLINE MARKETING Growth of Internet advertising revenues o Worldwide digital ad spending will reach $223.74 billion in 2017, representing 38.3% of total paid media outlays. This format is expected to see double-digit growth through at least 2020 o Global advertising expenditure in soci
Slide 29: Experienced Senior Leadership
EXPERIENCED SENIOR LEADERSHIP LIAT HELLMAN CFO (ISRAEL) YEHUDA DAHAN GROUP CFO & DIRECTOR • Over 20 years’ experience in publicly traded companies • Over 15 years’ experience in accounting and finance • Serves as CFO (Israel) of the company since its inception and • Previously CFO for Barinboim is r