Adtraction Group Ab · OMXSTO:ADTR
Adtraction Group Ab — Q1 2024 Earnings Presentation
40 slides from Adtraction Group Ab's earnings presentation, May 3, 2024
Slide 1: Financial Hearings Q1 2024
Financial Hearings Q1 2024
Slide 2: The state of Adtraction
The state of Adtraction ● Growth rates Q1 ○ Sales -1% ○ Gross profit 9% ● Profitability ○ EBITA of SEK 10,6 million, 9% growth ○ Margin of 3,7% ● Cash Flow from operations ○ SEK 2,6 million ● First tranche of dividend paid, SEK 1 © Copyright - Adtraction
Slide 3: The state of Adtraction
The state of Adtraction ● Growth rates Q1 ○ Sales -1% ○ Gross profit 9% 9% ● Profitability ○ EBITA of SEK 10,6 million, 9% growth ○ Margin of 3,7% ● Cash Flow from operations ○ SEK 2,6 million ● First tranche of dividend paid, SEK 1 © Copyright - Adtraction
Slide 4: The state of Adtraction
The state of Adtraction ● Growth rates Q1 ○ Sales -1% ○ Gross profit 9% ● Profitability ○ EBITA of SEK 10,6 million, 9% growth ○ Margin of 3,7% ● Cash Flow from operations ○ SEK 2,6 million ● First tranche of dividend paid, SEK 1 © Copyright - Adtraction
Slide 5: The state of Adtraction
The state of Adtraction ● Q1 ○ Johanna Olsson, CCO ○ E-commerce growth in most markets, but not all ○ Weak market for consumer credits ● Klara Lån divested ● Current focus ○ Back to growth for teams with negative growth ○ Project X - One platform ○ Europe ○ Influencers ○ Klara Lån divested © Copyrigh
Slide 6: The state of Adtraction
The state of Adtraction ● Q1 ○ Johanna Olsson, CCO ○ E-commerce growth in most markets, but not all ○ Weak market for consumer credits ● Klara Lån divested ● Current focus ○ Back to growth for teams with negative growth ○ Project X - One platform ○ Europe ○ Influencers ○ Klara Lån divested © Copyrigh
Slide 7: The state of Adtraction
The state of Adtraction ● Q1 ○ Johanna Olsson, CCO ○ E-commerce growth in most markets, but not all ○ Weak market for consumer credits ● Klara Lån divested ● Current focus ○ Back to growth for teams with negative growth ○ Project X - One platform © Copyright - Adtraction
Slide 8: RTM
RTM 250 50% 200 40% o 15 10% o is 10% ) a a i | i i ll | | 0% 0% Q121 Q221 Q321 Q421 @Q122 Q222 Q322 @Q422 Q1235 Q223) Q323 Q423) Q124 o ~ @ Gross profit R12 @ EBITA R12 EBITA / Gross profit R12 © Copyright - Adtraction
Slide 9: So what is that business model?
So what is that business model? 9 Partner marketing (affiliate marketing) We help brands (advertisers) increase sales We help partners (publishers, affiliates) monetize traffic and content © Copyright - Adtraction
Slide 10: A platform business
A platform business Advertisers Partners ● Lyko ● Content ● Influencers ● Lindex ● Tech ● Åhlens ● Affiliates ● Lendo ● Viaplay ● Hallon © Copyright - Adtraction
Slide 11: Partners
Partners Content marketing Creators Savings & rewards Other Direct marketing Paid marketing © Copyright - Adtraction
Slide 12: Advertisers manage a broad range of partners
Advertisers manage a broad range of partners 12 No network Connected to 900 partners © Copyright - Adtraction
Slide 13: Partners manage a broad range of advertisers
Partners manage a broad range of advertisers 13 No network Connected to 200 advertisers © Copyright - Adtraction
Slide 14: Adtraction simplifies partnerships
Adtraction simplifies partnerships 14 2023 No network ● 130 000 connections Network ● 2 300 advertisers ● 10 000 partners © Copyright - Adtraction
Slide 15: How does partner marketing fit into the marketing mix of a brand?
How does partner marketing fit into the marketing mix of a brand? 15
Slide 16: Example of traffic sources of an online business
Example of traffic sources of an online business © Copyright - Adtraction
Slide 17: Example of traffic sources of an online business
Example of traffic sources of an online business © Copyright - Adtraction
Slide 18: Financial goals
Financial goals Net sales growth > 20% EBITA margin goal > 7% © Copyright - Adtraction
Slide 19: Sales growth
Sales growth © Copyright - Adtraction
Slide 20: Sales R12 2021-2023, MSEK
Sales R12 2021-2023, MSEK © Copyright - Adtraction
Slide 21: EBITA margin
EBITA margin © Copyright - Adtraction
Slide 22: Q1 margins
Q1 margins © Copyright - Adtraction
Slide 23: What drives Adtraction's GP growth Q1?
What drives Adtraction’s GP growth Q1? Acquisitions, 10% Geographical expansion Growth in existing markets, -1% © Copyright - Adtraction
Slide 24: Number of employees 2008-2023
Number of employees 2008-20231) © Copyright - Adtraction 1. FTE by the last day of each period
Slide 25: Cost base per quarter, MSEK
Cost base per quarter, MSEK © Copyright - Adtraction
Slide 26: Q1 2024
Q1 2024 ● -1% growth ● 9% growth ● EBITA increase 9% ● 13% increase ● -12% organic growth ● -1% organic growth ● EBITA margin 3,7% ● 30-60% dividend ● 11% acquired ● 10% acquired ● Costs stable ● EBITA margin increase Net sales Gross profit EBITA Adj. net result/share -1% © Copyright - Adtraction
Slide 27: Q1 2024
Q1 2024 ● -1% growth ● 9% growth ● EBITA increase 9% ● 13% increase ● -12% organic growth ● -1% organic growth ● EBITA margin 3,7% ● 30-60% dividend ● 11% acquired ● 10% acquired ● Costs stable ● EBITA margin increase Net sales Gross profit EBITA Adj. net result/share 9% © Copyright - Adtraction
Slide 28: Q1 2024
Q1 2024 ● -1% growth ● 9% growth ● EBITA increase 9% ● 13% increase ● -12% organic growth ● -1% organic growth ● EBITA margin 3,7% ● 30-60% dividend ● 11% acquired ● 10% acquired ● Costs stable ● EBITA margin increase Net sales Gross profit EBITA Adj. net result/share 9% © Copyright - Adtraction
Slide 29: Q1 2024
Q1 2024 ● -1% growth ● 9% growth ● EBITA increase 9% ● 13% increase ● -12% organic growth ● -1% organic growth ● EBITA margin 3,7% ● 30-60% dividend ● 11% acquired ● 10% acquired ● Costs stable ● EBITA margin increase Net sales Gross profit EBITA Adj. net result/share 13% © Copyright - Adtraction
Slide 30: Q1 2024 - Verticals
Q1 2024 - Verticals ● 5% growth ● 15% growth ● Majority Klara lån ● -1% organic ● -3% organic ● Growth on 8/12 ● Committed to vertical markets E-commerce Finance Other 5% © Copyright - Adtraction
Slide 31: Q1 2024 - Verticals
Q1 2024 - Verticals ● 5% growth ● 15% growth ● Majority Klara lån ● -1% organic ● -3% organic ● Growth on 8/12 ● Committed to vertical markets E-commerce Finance Other 15% © Copyright - Adtraction
Slide 32: Q1 2024 - Verticals
Q1 2024 - Verticals ● 5% growth ● 15% growth ● Majority Klara lån ● -1% organic ● -3% organic ● Growth on 8/12 ● Committed to vertical markets E-commerce Finance Other 4% © Copyright - Adtraction
Slide 33: Q1 2024 - Geographies
Q1 2024 - Geographies ● 7% growth ● 17% growth ● -4% organic growth ● 6% organic growth ● 1/4 markets grow ● 6/8 markets grow Nordics Europe 7% © Copyright - Adtraction
Slide 34: Q1 2024 - Geographies
Q1 2024 - Geographies ● 7% growth ● 17% growth ● -4% organic growth ● 6% organic growth ● 1/4 markets grow ● 6/8 markets grow Nordics Europe 17% © Copyright - Adtraction
Slide 35: Q1 2024 - Cash flow
Q1 2024 - Cash flow ● Partner payments Operational cash flow Investing activities ● Divested Klara lån 2.6 MSEK (10.8) -2.3 MSEK (-175.1) Jan - Mar 2024 Jan - Mar 2024 ● Strong net cash position Financing activities Total cash flow -0.6 MSEK (151.7) -0.2 MSEK (-12.6) Jan - Mar 2024 Jan - Mar 2024 Net c
Slide 36: Q1 2024 - Cash flow
Q1 2024 - Cash flow ● Strong correlation with adj. Net profit over time ● Working capital fluctuate ○ Payment model © Copyright - Adtraction
Slide 37: Combined financials
Combined financials Sales Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 293 978 325 888 360 076 371 028 330 644 323 526 353 693 375 158 289 822 Gross profit Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Q2 23 Q3 23 Q4 23 Q1 24 49 716 55 537 60 492 66 207 57 717 59 550 66 418 71 324 56 860 EBITA Q1 22 Q2 22 Q3
Slide 38: Project X - One platform
Project X - One platform © Copyright - Adtraction
Slide 39: What's happening now?
What’s happening now? ● Q2 performance ○ Small negative GP growth in April ○ Continued profitability ● Focus ○ Project X ○ Back to growth ○ Europe © Copyright - Adtraction 39
Slide 40: Q&A
Q&A