Cision — Debt Investor Presentation (July 2017)
40 slides from Cision's debt investor presentation, Jul 11, 2017
Slide 1: Lender Presentation July 2017
Lender Presentation July 2017
Slide 2: Disclaimer
Disclaimer This presentation is based on information provided by Canyon Holdings S.a.r.l and its subsidiaries (“Cision” or the "Company”). The information contained in this presentation (the "Information") is being furnished on a confidential basis solely for use by the recipient in making its own e
Slide 3: Presenters
Presenters Kevin Akeroyd Chief Executive Officer Jack Pearlstein Executive VP & Chief Financial Officer 2
Slide 4: Table of Contents
Table of Contents 1. Transaction Overview 2. Cision Overview 3. Key Credit Highlights 4. M&A Integration Update 5. Financial Overview Appendix 3
Slide 5: Transaction Overview
Transaction Overview
Slide 6: Transaction Overview
Transaction Overview Cision is the go-to global SaaS platform for communications professionals, helping brands communicate with key constituents and both understand and influence public perception in an increasingly complex media landscape The Company generated $609 million of revenue and $266 milli
Slide 7: Sources, Uses and Pro Forma Capitalization
Sources, Uses and Pro Forma Capitalization Step 1: Sources of Funds Step 2: Sources of Funds Net Equity Proceeds $294 Add-on First Lien Term Loan $131 Total Sources $294 Total Sources $131 Step 1: Uses of Funds Step 2: Uses of Funds Repay 2nd Lien Term Loan $294 Repay Outstanding Revolver $38 Repay
Slide 8: Cision Overview
Cision Overview CISION
Slide 9: The Next Enterprise Cloud Platform
The Next Enterprise Cloud Platform Cision is the go-to global SaaS platform for communications professionals and is transforming the corporate PR function much like other SaaS solutions transformed finance, HR, sales and marketing Finance HR professionals professionals Communications professionals S
Slide 10: Cision Offers a Comprehensive Product Suite
Cision Offers a Comprehensive Product Suite Cision helps brands communicate with key constituents and both understand and influence public perception in an increasingly complex media landscape Media Database Media Distribution Media Monitoring Media Analysis Search for, filter and contact Execute ca
Slide 11: Industry Standard for PR Professionals
Industry Standard for PR Professionals Cision is deeply embedded in industry workflow 10 Sources: LinkedIn and Twitter.
Slide 12: Expansive Global Reach
Expansive Global Reach 2016 Revenue by Geography(1) Asia LATAM EMEA, ex. UK 3% 1% 7% Canada 7% UK 13% US 69% Cision headquarters Cision office (Chicago, Illinois) (1) Based on actual currency rates. Pro forma for a full year of (i) the acquisition of PR Newswire, completed June 2016; (ii) the divest
Slide 13: Key Credit Highlights
Key Credit Highlights CISION
Slide 14: Key Credit Highlights
Key Credit Highlights 1 Leading Player in the Industry 2 Significant Industry Tailwinds 3 Diversified, Recurring Business Model 4 Blue-Chip Customer Base 5 Increasing Revenue Retention Rates 6 Strong Free Cash Flow Conversion 7 Compelling Near-Term Opportunity 8 Experienced Management Team 13
Slide 15: Leading Player in the Industry
1 Leading Player in the Industry Cision is uniquely positioned with its scale, comprehensive product set and global reach Scale Products Geography Company Est. Revenue Monitoring Analysis Database Distribution Global Reach Americas, EMEA, $615m & Asia $189m EMEA Americas, EMEA, $176m & Asia $127m Am
Slide 16: Significant Industry Tailwinds
2 Significant Industry Tailwinds Global PR software market grew from $2.4 billion in 2011 to $3.2 billion in 2016, representing a 6% CAGR CMO: Becoming the Largest Technology Buyer Enterprise Technology Spend as % of 2016 Revenue 3.2% 3.4% CMO (Marketing) CIO (IT) Marketing technology spend is expec
Slide 17: Marketing Clouds Demonstrate Platform Success
2 Marketing Clouds Demonstrate Platform Success Over the last 7 years, SaaS leaders have successfully consolidated digital marketing solutions into large and rapidly growing platforms. Prior to joining Cision, Kevin Akeroyd led the team that built the Oracle Marketing Cloud from the nascent stage Pl
Slide 18: Diversified, Recurring Business Model
3 Diversified, Recurring Business Model 2016 Revenue by Type Customer Concentration Transaction 18% Recurring 19% Subscription 63% Top 25 customers account for 3% of revenue U.S. Customer Distribution Enterprise Mid Market SMB ~$52k ACV ~$10k ACV ~$2k ACV 1% 1% 1% 97% Top 3 Top 4-10 Top 11-25 other
Slide 19: Blue Chip Customer Base
4 Blue Chip Customer Base Cision’s loyal customer base represents a powerful growth engine to sell through as the product suite expands Extensive Reach of Enterprise & PR Customers 75,000+ global customers 91 of the top 100 worldwide brands 96 of the top 100 PR companies in the US 47 of the top 50 P
Slide 20: Increasing Retention Rates
5 Increasing Retention Rates Management expects retention rates to continue upward trajectory in 2017, driven by the launch of C3 and related cross-sell initiatives to increase revenue from existing customers US Dollar Retention Rates 92.0-93.0% 90.0% 87.9% 86.3% FY15 FY16 2017E Long-term Target Not
Slide 21: Strong Free Cash Flow Conversion
6 Strong Free Cash Flow Conversion EBITDA growth and low capex intensity (CAPEX ~5% of revenue) expected to drive 14.3% 2017-2021 CAGR in free cash flow to equity With a new capital structure following the consummation of its merger with Capitol, Cision will have lower interest expense and lower lev
Slide 22: Compelling Near-Term Opportunity
7 Compelling Near-Term Opportunity TM The Cision Communications Cloud is expected to transform the communications industry A Core Category Leader Cision is a global leader, with a comprehensive end-to-end product suite including distribution, media monitoring, media database and media analysis 2016
Slide 23: Integrated Cloud Platform: Launch of C3 and Evolution of Features
7A Integrated Cloud Platform: Launch of C3 and Evolution of Features In October 2016, Cision launched its new integrated platform, the Cision Communications Cloud TM The Cision Communications Cloud TM incorporates Cision’s full suite of products, creating a closed loop platform for executing and ana
Slide 24: Big Data: Expanding Measurement Capabilities & Data Monetization
Big Data: Expanding Measurement Capabilities & Data 7B Monetization Cision is currently building sophisticated attribution capabilities into the network, which it expects will enable customers to track end user reach, engagement and purchase conversion data, significantly increasing the value of Cis
Slide 25: Earned Media Platform Extensions
7C Earned Media Platform Extensions Cision plans to extend its platform into adjacent earned media categories through organic growth initiatives and bolt-on transactions, expanding the market opportunity Content Marketing Employee Ratings & Amplify Reviews Earned Cloud User- Generated Influencer Con
Slide 26: Experienced Management Team
8 Experienced Management Team Kevin Akeroyd — Chief Executive Officer Oversees the Cision executive management team across operations globally More than 25 years of experience in reshaping modern digital, social and mobile marketing Prior to Cision, Kevin was GM & SVP at Oracle Marketing Cloud, wher
Slide 27: M&A Integration Update
M&A Integration Update
Slide 28: 1H17 Acquisitions: Bulletin Intelligence
1H17 Acquisitions Acquisition of Bulletin Intelligence Target Overview Bulletin provides expert analysts who deliver highly-customized, must-read briefings to closed audiences first thing each business morning, providing a comprehensive view of news and other competitive intelligence to highest-leve
Slide 29: PRN Synergy Detail
PRN Synergy Detail Actioned as of 6/30/17 FTE Facilities Other Total Region Synergies Synergies Synergies Synergies US 18.3 0.6 11.0 29.9 Canada 3.7 0.8 1.6 6.1 EMEA 3.4 0.3 1.1 4.8 Totals $25.4 $1.7 $13.7 $40.8 Remaining as of 6/30/17 FTE Facilities Other Total Region Synergies Synergies Synergies
Slide 30: PRN Integration Update — Cross Sell
PRN Integration Update — Cross Sell Cision and PRN US achieved over $9 million of new subscription bookings annual contract value in the first twelve months of cross-sell activity US Cumulative Cross-Sell ACV ($ in 000s) $1,360 (1) $9,268 $7,167 $4,938 Q3-16 Q4-16 Q1-17 Q2-17 (1) June 2017 figures r
Slide 31: Financial Overview
Financial Overview
Slide 32: Predictable, Recurring Revenue
Predictable, Recurring Revenue Cision closed its acquisition of PR Newswire in June 2016, creating a global PR solutions platform leader with $608 million of pro forma 2016 revenue(1), of which 82% is recurring in natureRecent launch of the Cision Communications Cloud and PRN cross-selling initiativ
Slide 33: Significant EBITDA Growth
Significant EBITDA Growth Anticipated cost synergies related to the PRN acquisition are the primary driver of the EBITDA margin expansion from 2016 to 2018Beginning in 2018, Cision plans to begin monetizing its high margin data analytics products Constant Currency PF Adj. EBITDA(1) ($ millions) $380
Slide 34: Projected Credit Metrics
Projected Credit Metrics Debt(1) / PF Adj. EBITDA(2) PF Adj. EBITDA(2) / Net Cash Interest(3) Unlevered FCF(4) / Net Cash Interest(3) 4.7x 12.4x 11.3x 4.3x 3.7x 8.3x 7.5x 2.9x 6.2x 5.4x 2.0x 5.2x 4.9x 4.5x 4.3x 3.6x 3.1x 1.2x 6/30 2017E 2018E 2019E 2020E 2021E 6/30 2017E 2018E 2019E 2020E 2021E 6/30
Slide 35: Appendix
29A129A29A12 5DE5 Appendix CISION
Slide 36: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Reconciliation of Net Income to Adjusted EBITDA ($ millions) Year ended December 31, Unaudited (1) 2015 2016 LTM 6/30/17 GAAP Net income (loss) ($90.5) ($98.4) ($106.8) Depreciation and amortization 104.0 127.0 147.1 Interest expense and loss on extinguishment of debt
Slide 37: Constant Currency Adj. EBITDA Reconciliation
Constant Currency Adj. EBITDA Reconciliation Reconciliation of GAAP Net Income (Loss) to EBITDA, Pro Forma Adjusted EBITDA and Pro Forma Adjusted EBITDA, Constant Currency ($ 000s) Three Months Ended (1) September 30, December 31, March 31, 2016 June 30, 2016 2016 2016 March 31, 2017 June 30, 2017 N
Slide 38: Income Statement
Income Statement Condensed Consolidated Statements of Net Income (Loss) ($ 000s) (1) Three Months Ended September 30, December 31, March 31, 2016 June 30, 2016 2016 2016 March 31, 2017 Revenue $77,704 $90,826 $150,778 $148,464 $145,818 Cost of revenue 28,537 32,120 51,581 50,345 45,066 Gross profit
Slide 39: Revenue Reconciliation
Revenue Reconciliation Reconciliation of GAAP Revenue to PF Revenue and PF Revenue, Constant Currency ($ 000s) Three Months Ended September 30, December 31, March 31, 2016 June 30, 2016 2016 2016 March 31, 2017 GAAP revenue, reported $77,704 $90,826 $150,778 $148,464 $145,818 Deferred revenue adjust
Slide 40: FX Assumptions
FX Assumptions Currency Q2-17 2017E Budget CAD 1.352 1.316 EUR 0.919 0.935 GBP 0.783 0.797 SEK 8.868 8.871 HKD 7.780 7.692 CNY 6.888 6.667 BRL 3.174 3.147 MXN 18.750 20.921 ARS 16.005 16.005 39