Slide 1: Management Presentation Third Quarter 2015 Results
Management Presentation Third Quarter 2015 Results October 28, 2015
Slide 2: Forward Looking Statements & Other Information
FORWARD LOOKING STATEMENTS & OTHER INFORMATION This presentation, including our “2015 Financial Outlook”, contains forward-looking statements. The Company’s representatives may also make forward-looking statements orally from time to time. Statements in this presentation that are not historical fact
Slide 3: Third Quarter 2015 Summary
THIRD QUARTER 2015 SUMMARY • Industry leading topline growth continues • Adjusted EBITDA growth and margin expansion now reflecting the recognition of incremental revenue from recent new business • Clear visibility for continued market share gains from strong new business results and robust pipeline
Slide 4: Third Quarter 2015 Financial Highlights
THIRD QUARTER 2015 FINANCIAL HIGHLIGHTS • Organic revenue growth of 5.7%, after a roughly 400 basis points reduction from significantly lower billable pass-through costs • Revenue increased 6.1% to $328.4 million from $309.4 million • Net loss attributable to MDC Partners of ($8.6) million versus ($
Slide 5: Year-to-Date Financial Highlights
YEAR-TO-DATE FINANCIAL HIGHLIGHTS • Organic revenue growth of 7.1%, after a roughly 170 basis points reduction from significantly lower billable pass-through costs • Revenue increased 9.5% to $967.2 million from $883.6 million • Net loss attributable to MDC Partners of ($11.1) million versus income
Slide 6: Consolidated Revenue and Earnings
CONSOLIDATED REVENUE AND EARNINGS (US$ in millions, except percentages) Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 % Change 2015 2014 % Change Revenue $ 328.4 $ 309.4 6.1 % $ 967.2 $ 883.6 9.5 % Operating Expenses Cost of services sold 212.9 205.5 3.6 % 648.4 575.9 12
Slide 7: Summary of Segment Results - Revenue
SUMMARY OF SEGMENT RESULTS - REVENUE (US$ in millions, except percentages) Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 % Change 2015 2014 % Change Revenue Strategic Marketing Services $ 264.6 $ 238.4 11.0 % $ 775.1 $ 683.3 13.4 % Performance Marketing Services 63.9 71.
Slide 8: Organic Revenue Growth by Segment
ORGANIC REVENUE GROWTH BY SEGMENT Three Months Ended September 30, Nine Months Ended September 30, Strategic Performance Weighted Strategic Performance Weighted Marketing Marketing Average Marketing Marketing Average Services Services Total Services Services Total Organic Growth 10.8% -11.4% 5.7% 10
Slide 9: Third Quarter Revenue by Client Industry
THIRD QUARTER REVENUE BY CLIENT INDUSTRY Q3 2015 Mix Year-over-Year Growth by Category Q3 2015 YTD 2015 Above 10% Healthcare, Healthcare, Consumer Automotive, Products, Technology, Technology, Other Automotive, Other 0% to 10% Consumer Products, Food & Beverage, Food & Beverage Communications Below
Slide 10: Organic Growth Highlights Sustained Market Share Gains
ORGANIC GROWTH HIGHLIGHTS SUSTAINED MARKET SHARE GAINS Notes: (1) MDC organic growth excludes Accent (sold in Q2 2015) in all periods. (2) Peers include Omnicom, IPG, WPP, Havas and Publicis. 10
Slide 11: Summary of Segment Results – Adjusted EBITDA
SUMMARY OF SEGMENT RESULTS – ADJUSTED EBITDA (US$ in millions, except percentages) Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 % Change 2015 2014 % Change Adjusted EBITDA Strategic Marketing Services $ 50.3 $ 39.7 26.9 % $ 122.4 $ 120.4 1.7 % margin 19.0% 16.6% 15.8% 1
Slide 12: Adjusted EBITDA Available for General Capital Purposes
ADJUSTED EBITDA AVAILABLE FOR GENERAL CAPITAL PURPOSES (US$ in millions) Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Adjusted EBITDA (1) $53.5 $42.9 $132.1 $127.6 Net Income Attibutable to Noncontrolling Interests (2.1) (1.7) (7.3) (4.8) Capital Expenditures,
Slide 13: Available Liquidity
AVAILABLE LIQUIDITY* (US$ in millions) September 30, 2015 December 31, 2014 Commitment Under Facility $325.0 $325.0 Drawn 85.3 0.0 Undrawn Letters of Credit 5.0 4.8 Funds Available Under Facility $234.7 $320.2 Total Cash & Cash Equivalents 15.8 113.3 Liquidity $250.4 $433.5 * Subject to available bo
Slide 14: 2015 Financial Outlook
2015 FINANCIAL OUTLOOK Implied 2014 2015 Year over Year Actuals Guidance Change Revenue $1.22 billion $1.30 to $1.33 billion +6.5% to +8.5% Adjusted EBITDA $179.4 million $195 to $205 million +8.7% to +14.3% Implied Adjusted EBITDA Margin 14.7% 15.0% to 15.4% +35 to +75 basis points Adjusted EBITDA
Slide 15: Appendix
APPENDIX 15
Slide 16: Temporal Put Obligations and Impact on EBITDA
TEMPORAL PUT OBLIGATIONS AND IMPACT ON EBITDA Estimated Put Impact at September 30, 2015 Payment Consideration Incremental (US$ in millions) Cash Stock Total EBITDA in Period 2015 2.3 0.0 2.3 1.5 2016 1.9 0.0 1.9 0.0 2017 2.9 0.1 3.0 1.4 2018 1.8 0.0 1.8 0.0 Thereafter 9.6 0.0 9.6 1.4 Total $18.5 $0
Slide 17: Summary of Cash Flow
SUMMARY OF CASH FLOW Nine Months Ended September 30, (US$ in millions) 2015 2014 Cash flows provided by (used in) continuing operating activities ($9.1) $39.0 Discontinued operations (1.3) (3.6) Net cash provided by (used in) operating activities ($10.5) $35.4 Cash flows used in continuing investing
Slide 18: Definition of Non-GAAP Measures
DEFINITION OF NON-GAAP MEASURES Adjusted EBITDA: Adjusted EBITDA is a non-GAAP measure, that represents operating profit plus depreciation and amortization, stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments, profit distributions from affiliates and othe
Slide 19: MDC Partners Innovation Center, New York
MDC Partners Innovation Center 745 Fifth Avenue, Floor 19 New York, NY 10151 646-429-1800 www.mdc-partners.com