Team Internet Group Plc · LSE:TIG
Team Internet — FY2023 Earnings Presentation
35 slides from Team Internet's earnings presentation, March 2024
Slide 1: Investor Presentation March 2024
Investor Presentation March 2024
Slide 2: Disclaimer
DISCLAIMER NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN, AUSTRALIA OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO. The information contained in this confidentia
Slide 3: Agenda
01 Business profile 02 Highlights 03 Financial results 04 Strategy and outlook 3
Slide 4: What we do
What we do A leading global internet solutions company, operating in two highly attractive markets: digital advertising (Online Marketing segment) and domain name management solutions (Online Presence segment) USD 657.1 million USD 131.7 million 4
Slide 5: Why is now a good time to consider investing in Team Internet?
Why is now a good time to consider investing in Team Internet? Placeholder • Strong gross revenue growth of 15%; organic growth of 13% 1 Growth • Online Marketing growth of 14%, Online Presence growth of 17% • Significant multi-billion TAM opportunity, supported by industry megatrends Placeholder •
Slide 6: Growth and Value
1 Growth We have demonstrated strong organic growth over the last 5 years 12.6% Team Internet Organic 9.6% 10.8% 37.9% 61.5% Revenue Growth 744 838 461 5 Year CAGR: 25% 275 302 334 2018 2019 2020 2021 2022 2023 Pro-Forma Revenue1 in (USD ,m) 2 Value Our consistent high cash generation underscores ou
Slide 7: Our Online Marketing segment is being carried by irreversible mega trends
Our Online Marketing segment is being carried by irreversible mega trends Ascendance of social media Data privacy Risk transformation • Social media platforms (Facebook, Instagram, • Consumer data protection regulations drive advertisers • Online advertising evolution shifts risk from TikTok) transf
Slide 8: Online Presence segment aims to optimise the domain name industry
Online Presence segment aims to optimise the domain name industry for greater efficiency Move towards “exotic” Committed to excellence Optimising for efficiency domain names • The Online Presence segment aims to streamline the • Limited availability and rising prices of .com domains is • Team Intern
Slide 9: Team Internet creates a vibrant, symbiotic ecosystem
Team Internet creates a vibrant, symbiotic ecosystem, connecting a vast supply with substantial demand FY23 value flows, Sankey presentation Social Media: 44% Search: 67% Cost of Sale OM: $525m Revenue OM: $657m (Tonic., ParkingCrew) Native: 21% Search Ads: 6% Total Revenue: $837m Domains: 4% Ecomme
Slide 10: Highlights
01 Business profile 02 Highlights 03 Financial results 04 Strategy and outlook 10
Slide 11: FY 2023 Financial Highlights
FY 2023 Financial Highlights Record Full Year Results Gross Revenue Net Revenue Adjusted EBITDA1 Operating Profit $836.9m +15% $191.1m +8% $96.4m +12% $42.3m +26% FY 2022: $728.2m FY 2022: $177.7m FY 2022: $86.0m FY 2022: $33.6m Adjusted EPS Net Debt Proposed Dividend P/E2 ¢22.41 +34% $74.1m +31% 2.
Slide 12: 13% Group organic revenue growth for FY 2023
13% Group organic revenue growth for FY 2023 Strong value propositions make for strong growth Online Marketing Online Presence Operational KPIs Online Marketing KPIs 2 12% $658m FY 23 FY 22 Δ organic growth Visitor Sessions (bn): 5.9 4.6 27% $589m 1.2 RPM ($): 95 105 -9% 13.9 16% organic growth 657.
Slide 13: Share Buyback Programme
Share Buyback Programme Capital allocation policy geared towards greater shareholder returns Funds committed Share buyback limit Buyback period A total of 28,866,000 Aggregate consideration reaches the £34.0m shares buyback limit Funds utilised to date1 Funds available1 Shares in treasury1 £32.1m £1
Slide 14: Financial results
01 Business profile 02 Highlights 03 Financial results 04 Strategy and outlook 14
Slide 15: Income Statement
Income Statement FY FY % ($, m) 2023 2022 Change Revenue 836.9 728.2 15% • Gross margins remaining stable in Cost of Sales (645.8) (550.5) each business - product mix shifting Net Revenue (Gross Profit) 191.1 177.7 8% with massive growth of Media Gross Margin % 23% 24% Buying Operating Expenses (144
Slide 16: Balance sheet
Balance sheet FY FY ($, m) 2023 2022 % Change Non-Current Assets 347.1 365.0 -5% Current Assets 199.6 193.6 3% Net debt increased by USD 17.5m since Total Assets 546.7 558.6 -2% FY 2022 due to: Non-Current Liabilities 184.9 194.0 -5% Current Liabilities 208.3 197.6 5% • The Company returning cash to
Slide 17: Robust cash conversion
Cash generation from operations Robust cash conversion = 96% of Adjusted EBITDA We expect this to continue to normalise nearer to 100% Cash conversion 96% 110% FY FY (%) Adjusted Cashflow Bridge: 2023 2022 Cashflow from operations 81.0 86.0 Exceptional costs 6.1 7.8 96.4 92.6 86.0 95.0 Settlement of
Slide 18: Strategy and outlook
01 Business profile 02 Highlights 03 Financial results 04 Strategy and outlook 18
Slide 19: Strategic priority: creating a virtuous circle
Strategic priority: creating a virtuous circle Organic growth Operating leverage • New customer wins • Achieve cost savings in future periods by • Growing existing customers, and cross- continuing our integrations selling our services • We expect operational gearing to continue • Launching new produ
Slide 20: Acquisition of Shinez expected to complete in Q2 2024
Acquisition of Shinez, an innovative content publishing and monetisation business, is expected to complete in the middle of Q2 2024 Overview Shinez Business Model • Shinez is a data driven content creation and publishing company with a proven track record in monetising traffic through a proprietary
Slide 21: Shinez delivers on focused bolt-on acquisitions, immediately accretive
Shinez delivers on the promise of focused bolt-on acquisitions that are immediately accretive before synergies and beat share buybacks in terms of cashflow returns Accretion Summary1 (based on FY23 Pro Forma) From a cashflow yield perspective, the transaction yields higher returns FY23 Pro Forma on
Slide 22: Diversifying the revenue model in line with online advertising trends
Team Internet is diversifying its revenue model in line with the Online Advertising industry risk transformation trends Traffic Acquisition TI acquires traffic by placing ads on social media, search engines, advertising networks and content websites PPC PAY PER CLICK Traffic Monetisation Models 1 2
Slide 23: OM2 Omni-media, Omni-monetisation vision
TIG OM2, Omni-media, Omni-monetisation vision: to build a unified customer acquisition platform relaying the right customer to the right merchant Social Media Tier 1 Networks OM2: Omni-Media, Omni-Monetisation Search Engines Tier 2 Networks Content Discovery Networks Direct Advertiser Third-Party Do
Slide 24: How will Team Internet look in the next 10 years?
How will Team Internet look in the next 10 years? More diversified revenue and supply sources 01 More vertically integrated 02 Global leadership ambitions 03 Firmly rooted in our core values and beliefs 04 24
Slide 25: AI is seamlessly woven into our daily operations
At Team Internet, AI is seamlessly woven into the fabric of our daily operations Raising Raising Raising the Floor the Ceiling Awareness • Democratise AI knowledge within the organisation • Advanced training for engineers and data • AI Academy to nurture critical and creative scientists thinking in
Slide 26: Team Internet Outlook
Team Internet Outlook ○ The Directors are pleased to confirm that the Group continues to be confident in its ability to meet market expectations1 ○ With high cash reserves, strong operating cash generation, and committed credit facilities, the Company is fully funded to execute its strategy to simul
Slide 27: Thank you
Thank you tj team internet.
Slide 28: Glossary of Terms
Glossary of Terms Adtech Domain Years An umbrella term for advertising technology Number of domain years sold (number of domains x number of years). Used instead of number of domains as occasionally customers register or renew domain names Artificial Intelligence or ‘AI’ for multiple years The theor
Slide 29: Appendix
Thank you Appendix 29
Slide 30: In Online Marketing, Team Internet helps online consumers make informed choices
In Online Marketing, Team Internet helps online consumers make informed choices – an evergreen purpose Team Internet does so by creating consumer journeys that convert general interest media users into high 01 conviction online consumers. Team Internet engages by offering contact points on social me
Slide 31: Consumers on social media are run through brief consumer guides
Consumers on social media are run through brief consumer guides before being referred to a recommended merchant Social media user experience: Team Internet places ads An online consumer is The online consumer is The online consumer is The online consumer for broad categories on then forwarded an the
Slide 32: Search engine users are directed to review websites before buying
Search engine users are directed to review websites before buying the product of their choice at an ecommerce partner Search engine user experience: Team Internet places ads for product The online consumer is then presented The online consumer then clicks out to categories on search engines. Due to
Slide 33: Online consumers value noise reduction and privacy
Online consumers value the noise reduction and privacy – value is captured through commercial alliances Team Internet and its partners place a broad array of contact points Value Creation in the form of ads Value Capture Merchant pays Consumer engages Online consumers: Team Internet, with a Team Mer
Slide 34: In Online Presence, Team Internet is a leading distribution channel for domains
In Online Presence, Team Internet is a leading distribution channel for domains and one-stop shop for their users Reseller Retail Enterprise Access 2.5M SMBs 250k in c.200 countries Market features via 20k channel partners • Subscription revenues • Huge customer stickiness - only 3% of CUSTOMER cust
Slide 35: Cashflow waterfall model aligns strategic priorities
Cashflow waterfall model aligns Team Internet’s strategic priorities Waterfall model The Directors are confident in the Group's strategic investments in innovation, integration, ○ To ensure compatibility among CentralNic’s strategic priorities, the Board intends to allocate the Group’s free cash flo