Modern Times Group MTG AB Class A · OMXSTO:MTG_A
Modern Times Group MTG AB Class A — Merger or Acquisition (October 2016)
20 slides from Modern Times Group MTG AB Class A's merger presentation, October 2016
Slide 1: MTG enters online gaming market by acquiring 35% of InnoGames
Slide 2: Agenda
Agenda = Transaction highlights = The gaming market and InnoGames @ Strategic rationale = Summary
Slide 3: Transaction highlights
Transaction highlights = MTG to acquire 35% of InnoGames at an attractive valuation — Transaction based on an Enterprise value (100%) of EUR 260m, equivalent to 2.1x sales and 10.4x EBITDA (2016E) — Shares to be bought in 2 tranches - 20.6% in Q4 16 and 14.4% in Q1 17 — Call option to acquire a furt
Slide 4: Agenda
Agenda ™@ Transaction highlights = The gaming market & InnoGames @ Strategic rationale = Summary
Slide 5: Global Gaming Market and Key Growth Drivers
Global Gaming Market (USD bn) Key Growth Drivers CAGR 2015-18F 113 92 New More players Segments (Mobile, Browser) More paying 28 Console 0% players 28 PC 5 ; (traditional) Higher spend per player 2015 2018E Source: Newzoo; OC&C analysis
Slide 6: More players, more paying players, higher spend per player
More players More paying players Higher spend per player Global Video Gamers (bn) 23 2.4 21 2.0 2015 2016E 2017E 2018E Share of Paying Mobile Gamers (USA & Western Europe) 46% 36% 2012 2014 Revenue per Mobile Gamer (North America) $38 ae 2014 2015 Source: Statista; Newzoo; OC&C analysis
Slide 7: Revenue (EURm) & EBITDA margin (%)
Revenue (EURm) & EBITDA margin (%) ™ Founded in 2007 in Hamburg; 400 employees 06 = A global games developer and self-publisher with 424%) 704 established track record in Strategy / RPG 65 82 @ Portfolio of 6 cross-platform titles operating with free-to- 00% play model, i.e. monetised through in-gam
Slide 8: InnoGames history and game portfolio
trigal Wars YREWBY GREPOLIS 2003: InnoGames founders Hendrik Klindworth, Eike Klindworth and Michael Zillmer develop the first version of browser-based MMO strategy game — Tribal Wars 6 successful games with more to come 2008: 2010: InnoGames’ InnoGames launches its second game, third game, Grepolis
Slide 9: Trailers
Trailers Forge of Empires: https://www.youtube.com/watch?v=etIXiJILIMk https://www.youtube.com/watch?v=xGE-Op_eAJU Elvenar: https://www.youtube.com/watch?v=zk0_frllL-| Tribal Wars: https://www.youtube.com/watch?v=zv-VuRmp8LU
Slide 10: MMO Strategy, Survival, Role Playing
MMO Strategy Survival Role Playing Epic guardians First of its type on mobile Stunning 3D graphics Mysterious single player Diverse game world Unique crafting system
Slide 11: Free-to-Play and in-game monetisation
Free-to-Play / Register Minecraft is the only non free-to- } play game in the Top100 grossing titles It is possible to play without spending <A NOW ONLY: Register and secure 50 crowns! money ... Free registration and free 50 free crowns as in-game currency upon registration - easy entry into “pay wo
Slide 12: More Mobile
More Mobile Mobile share of total revenues @ Successfully launched multiple mobile extensions for existing titles 25% ™ Mobile revenue share has increased from 3% to 25% over 3 years 19% @ >50% of new registrations are on mobile . . . 13% @ Several mobile-only titles currently in ° development or si
Slide 13: InnoGames management team
a Markos Lipp Michael Ziimer Fike Kinawort Studied Information System & Software Engineering at Carl von Ossietzky University Oldenburg; Executive Programme at Stanford >10 years management experience at InnoGames 1. CPO = Chief Product Officer;,GDD = Game Design Director 2015 Business studies at Ba
Slide 14: Agenda
Agenda ™@ Transaction highlights ™ The gaming market & InnoGames § Strategic rationale = Summary
Slide 15: Powerful network effects
QeEsSu GREAMHACK | &. | ZOOMING &InnoGames} Powerful network effects
Slide 16: eSports and MPN value chain
X | eSports MPN Watch - Interact - Compete Watch — Create - Share ™ Discover new games and features = Watching tutorials / recaps / live matches of leading teams and ™ Discover new games ™ Start interacting with other players ® Join leagues and participate in players tournaments ™ Recording own vide
Slide 17: Agenda
Agenda ™@ Transaction highlights ™ The gaming market & InnoGames @ Strategic rationale = Summary
Slide 18: Summary
Summary ™ Key milestone in MTG’s strategic transformation as leading digital video entertainer ™ Creates 3rd vertical to complement esports and MPNs ™@ Provides entry to multi-billion dollar global online gaming market @ Well positioned company with established portfolio of successful games, fast gr
Slide 19: Managing the transformation into a leading digital entertainment provider
Managing the Into a leading transformation digital of a traditional entertainment broadcaster provider Delivering on our strategy iA DS OS rE
Slide 20: Genter,
Genter, Wenairia wnat we lave, We Ve ena: ick ae er ne lite f =~ som bei i a ag “ ; ns We are Smart =xele/ihi a Engaging Soitins: ys Thipkina sn Mig. investors@mtg.com
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