Enero Group Limited · ASX:EGG
Enero — FY2021 Earnings Presentation
34 slides from Enero's earnings presentation, Aug 18, 2021
Slide 1: 2021 Full Year Results Announcement
Enero Group Limited ABN 97 091 524 515 Level 2, 100 Harris Street Pyrmont NSW 2009 Australia t. +61 2 8213 3031 ASX ANNOUNCEMENT 2021 Full Year Results Announcement Enero Group Limited delivers FY21 underlying NPAT growth of 77% 18 August 2021: Enero Group Limited (ASX: EGG) today announced its resu
Slide 2: Chair and CEO commentary on FY21
Enero Group Chair, Ann Sherry said: “FY21 has been an exciting year of change and progress for Enero. Under the new leadership of CEO Brent Scrimshaw, the company has begun a transition into a forward looking, progressive global business, with a refined operating model that responds to the enormous
Slide 3: UK/Europe, Balance Sheet, Dividend and Trading Update
UK/Europe In a very challenging economic environment, the UK and Europe reported a net revenue decline of 5.8% and Operating EBITDA growth of 33%. The reported revenue decline was impacted by currency headwinds and the sale of 75% owned Frank PR which was divested to focus on Enero’s areas of specia
Slide 4: About Enero
About Enero: Enero Group is a creative technology company operating a global collective of marketing and communications specialist agencies listed on the Australian Stock Exchange (ASX). Its portfolio includes: digital agency Orchard; creative agency BMF; brand, marketing and PR comms consultancy Ho
Slide 5: Enero Group FY21 Full Year Results
Enero Group FY21 Full Year Results 18 August 2021 |. 1
Slide 6: Agenda
Agenda Business Performance & Strategy Overview Trading Update Group Financials Q&A 2 |. 2
Slide 7: Business Performance & Strategy Overview
Business Performance & Strategy Overview Brent Scrimshaw - CEO |. 3
Slide 8: FY21 Highlights
FY21 Highlights PEOPLE PORTFOLIO PERFORMANCE New leadership New approach to investment Client diversification New operating structure Acquisition of McDonald and longevity Strong culture Butler Associates EBITDA growth in every Divestment of Frank region and business |. 4
Slide 9: Group Trading Performance
Group Trading Performance ($M) FY21 FY20 % Change Net Revenue 160.6 135.8 18.3% Expenses 116.6 112.6 3.6% Operating EBITDA1 45.6 24.4 87.1% Operating EBITDA margin² 28% 18% 10 bpt Net Profit before significant items attributable to equity owners³ 22.8 12.9 76.7% Earnings per share before significant
Slide 10: A strong track record of sustainable growth
A strong track record of sustainable growth HIGHLIGHTS GROWING NET REVENUE (A$M)* GROWING OPERATING EBITDA (A$M) AND MARGIN (%)* • Net revenue has grown both organically and through 150 acquisitions over the past 5 years. 35 25.0% Acquisitions include MBA in FY21, Orchard in FY18 and Eastwick in 130
Slide 11: A refined global operating model
A refined global operating model |. 7
Slide 12: Strategic Priorities & Achievements
Strategic Priorities & Achievements STRATEGIC PRIORITIES + + + TALENT CAPABILITY PRODUCTIVITY INNOVATION Enhance leadership Undertake M&A to Implement technology Create an innovation and diversify skillsets strengthen current and processes to engine to drive new to drive organic portfolio improve pr
Slide 13: Key portfolio assets
BRAND Key portfolio assets TRANSFORMATION CREATIVE AGENCY: THE GLOBAL TECH COMMUNICATIONS HOME OF THE LONG IDEA – ENDURING, CONSULTANCY EFFECTIVE, EMOTIVE END TO END IDEAS LOCATION/S US, UK/Europe, Australia LOCATION/S Australia KEY CLIENTS INCLUDE: CLIENT WINS INCLUDE: KEY CLIENTS INCLUDE: CLIENT W
Slide 14: Key portfolio assets
CREATIVE DATA Key portfolio assets AND TECHNOLOGY DIGITALLY FOCUSED AGENCY: PROGRAMMATIC MARKETING PLATFORM: TRANSFORMING BUSINESSES THROUGH BETTER HELPING BUSINESSES ACCESS ONLINE CONNECTED EXPERIENCES ADVERTISING MARKETS LOCATION/S US, Australia LOCATION/S US KEY CLIENTS INCLUDE: CLIENT WINS REVEN
Slide 15: Client Analysis
Client Analysis REVENUE BY INDUSTRY (FY21)* Utilities & Energy Telecommunications 1% Banking, Finance & Insurance 3% 6% Technology Transportation/Airlines/Auto 26% 4% Manufacturing 4% REVENUE DIVERSIFICATION Services 8% • Strong client diversification with mix of clients across market industries and
Slide 16: Creating repeatable revenue
Creating repeatable revenue HIGHLIGHTS • The longevity of clients is reflected ATTRACTIVE CLIENT LONGEVITY BALANCED REVENUE CONTRIBUTION* in 60% having a duration of 4 years or more, supported by Enero’s broad offering of services and 6 years or more 32% capabilities which support client retention.
Slide 17: Results by Geography
Results by Geography ($M) Constant Currency HIGHLIGHTS FY21 FY20 % Change Variance • Delivery of strong results across all Net Revenue three geographic regions despite USA 60.1 39.5 52.2% 69.4% the backdrop of COVID lockdown conditions at different points of the Australia 65.0 58.6 10.9% 10.9% year.
Slide 18: Results by Geography
Results by Geography Geographical contribution from operating companies* FY21 FY20 HIGHLIGHTS • In FY21 International operations accounted for 55% of total revenue 26% and 67% of Operating Companies 30% EBITDA. NET 45% NET 45% REVENUE REVENUE • Strong growth in the US businesses increased their cont
Slide 19: USA
USA Constant Currency HIGHLIGHTS AS REPORTED ($M) FY21 FY20 % Change Variance • Strong revenue performance despite Net Revenue 60.1 39.5 52.2% 69.4% currency headwinds, with significant margin acceleration. Operating EBITDA 32.4 13.2 146.0% 173.7% • OBMedia significantly increased Operating EBITDA 5
Slide 20: Leveraging proprietary technology to deliver high-intent consumers to brands
Leveraging proprietary technology to deliver high-intent consumers to brands KEY METRICS OB MEDIA’S BUSINESS DRIVERS 130M +45% Consumers delivered to FY21 vs FY20 advertiser websites ACCELERATING DIGITAL E-COMMERCE CONSUMERS ADVERTISERS AND DIGITAL PUBLISHERS ADOPTION 5,000+ +84% Maximises Delivers
Slide 21: Australia
Australia HIGHLIGHTS • Revenue growth year-on-year and increased margin from simplified business portfolio in Australian market. • BMF traded strongly with new client wins, and high exposure to consumer sector. ($M) FY21 FY20 % Change Constant • Orchard also performed strongly with Currency Variance
Slide 22: UK and Europe
UK and Europe HIGHLIGHTS Constant Currency AS REPORTED ($M) FY21 FY20 % Change Variance • In a very challenging market environment, the business delivered Net Revenue 35.5 37.7 (5.8)% (1.4)% organic revenue growth of 1.1% on a constant currency basis. Operating EBITDA 7.6 5.7 33.2% 44.2% • Currency
Slide 23: Trading Update
Trading Update Brent Scrimshaw - CEO |. 19
Slide 24: Trading Update
Trading Update • Enero continues its 5-year track record of sustainable revenue and EBITDA growth. • The first six weeks of FY22 continue to deliver strong year-on-year revenue momentum. • We remain focused on maintaining Enero’s high margins across our strong and diversified portfolio. • Organic an
Slide 25: Group Financials
Group Financials Carla Webb-Sear, CFO |. 21
Slide 26: FY21 Group Financial Performance
FY21 Group Financial Performance HIGHLIGHTS Profit and Loss Summary ($M) FY21 FY20 • 14% Organic revenue growth. Net Revenue 160.6 135.8 1HFY21 and 2HFY21 demonstrated Other Revenue 1.6 1.2 consistently strong delivery. Staff costs (98.4) (93.6) • Staff costs ratio lower at 61% (FY20 - Operating exp
Slide 27: Reconciliation of statutory (4E) to continuing business results
Reconciliation of statutory (4E) to continuing business results FY21 Less Significant Statutory excluding Less Continuing ($M) 4E items Significant items Disposals business Net Revenue 160.6 160.6 (5.3) 155.3 Other income 1.6 1.6 (0.2) 1.4 Expenses (135.5) 23.2 (112.3) 3.5 (108.8) Depreciation ROUA
Slide 28: Reconciliation of statutory (4E) to continuing business results
Reconciliation of statutory (4E) to continuing business results FY20 Less Significant Statutory excluding Less Continuing ($M) 4E items Significant items Disposals business Net Revenue 135.8 135.8 (9.3) 126.5 Other income 1.2 1.2 (0.2) 1.0 Expenses (110.0) 2.2 (107.8) 7.6 (100.2) Depreciation ROUA (
Slide 29: Significant items
Significant items HIGHLIGHTS • Significant items are non cash and ($M) FY21 FY20 non recurring in nature. Loss on sale of Frank PR (9.9) - • In March 2021, the Group sold its entire shareholding in Frank PR. The Loss on disposal of dormant foreign subsidiaries (13.1) - Group recognised an accounting
Slide 30: Balance Sheet
Balance Sheet ($M) FY21 FY20 Cash 50.7 47.6 Trade and Other Receivables 46.9 34.6 Other assets 4.9 3.8 HIGHLIGHTS Current Assets 102.5 86.0 Deferred tax asset 2.0 2.6 • Increase in intangibles resulting from Intangible Assets 118.1 109.1 the MBA acquisition of $15m offset by Property, Plant and Equi
Slide 31: Balance Sheet & Capital Management
Balance Sheet & Capital Management HIGHLIGHTS • Recognised contingent consideration CASH AND CONTINGENT CONSIDERATION ($M) FY21 FY20 relating to the McDonald Butler (MBA) acquisition. Contingent consideration 25.6 33.8 Opening 1 July (at present value) • Actual payments are subject to Recognition on
Slide 32: Cash Flow & Working Capital
Cash Flow & Working Capital ($M) FY21 FY20 HIGHLIGHTS Operating EBITDA 45.6 24.4 • Working capital reduction linked with strong cash conversion. Expect some Right-of-use asset depreciation charge 4.3 4.8 unwind in FY22 as working capital position excluding cash is negative. Movement in working capit
Slide 33: Q&A
Q&A 29 |. 29
Slide 34: Disclaimer
Disclaimer This document has been prepared by Enero Group Except for any statutory liability which cannot be Limited (Enero) and comprises written materials/slides excluded, each of Enero, its related companies and for a presentation concerning Enero. This is not a their respective officers, employe