Fdj United · EURONEXT:FDJU
Fdj United — FDJ — IPO Roadshow (November 2019)
31 slides from Fdj United's IPO roadshow presentation, November 2019
Slide 1: Roadshow Presentation
Roadshow Presentation November 2019 FDJ - Strictly confidential.
Slide 2: FDJ: a national champion since 1933
FDJ: a national champion since 1933 Online Sports Betting eSport activities Ongoing innovation Offline Sports Betting (fixed odds) Offline Sports Betting (mutual odds) 1 st express Acquisition of B2B products 1 st Instant game 1 and services games 1933 1976 1978 1985 1989 1991 1998 2003 2004 2010 20
Slide 3: FDJ is N°1 in the attractive French gaming market
FDJ is N°1 in the attractive French gaming market Leadership Leading gaming operator Second largest lottery in France in Europe Scale 25m 85 games 30,000+ points of sale 2,500+ players 5 billionaires1 in c.11,000 municipalities employees2 Financial Strength €15.8bn stakes €2.4bn €1.8bn revenue €3.5
Slide 4: Delivering strong and resilient growth by expanding into new business lines
Delivering strong and resilient growth by expanding into new business lines Stakes evolution by business line (€bn) As % of 2018 15.8 1994-2018 15.1 total stakes 14.3 CAGR: 13.7 Sports 19% +5.2% 13.0 Betting 12.1 12.4 11.4 10.6 10.0 9.5 9.3 9.2 8.9 8.6 Instant 48% games 7.3 7.6 6.9 6.4 5.7 5.1 5.1 5
Slide 5: FDJ ownership structure and governance to evolve as part of the privatisation
FDJ ownership structure and governance to evolve as part of the privatisation Current Post IPO3,4 Lock-up for the French Tobacconists Others2 Tobacconists Others2,7 State and other main Confederation 7.6% Confederation7 7.6% existing shareholders8 2.0% 2.0% Public Double voting rights War veteran Wa
Slide 6: FDJ: a unique investment opportunity
FDJ: a unique investment opportunity Scale under exclusive rights: leader of attractive French gaming market with 25-year exclusive rights cemented by best-in-class Responsible Gaming Differentiating assets and proven expertise: iconic product offering and brands, omnichannel distribution and state-
Slide 7: Well positioned in fastest growing segments of attractive French gaming market
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Well positioned in fastest growing segments of attractive French gaming market Large market: Growing market: Moderate €10bn c.2% gaming spend (2018 GGR) (GGR
Slide 8: Clear legal and regulatory framework owing to PACTE law
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Clear legal and regulatory framework owing to PACTE law ANJ1 key missions 25-year exclusivity granted to FDJ by PACTE law Creation of the Autorité Nationale d
Slide 9: Strong commitment to Responsible Gaming and best-in-class CSR
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Strong commitment to Responsible Gaming and best-in-class CSR Responsible Gaming above and beyond regulatory requirements Strong CSR ratings cementing sustain
Slide 10: New gaming tax regime enshrined in law and aligning interests between French State and FDJ
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise New gaming tax regime enshrined in law and aligning interests between French State and FDJ 1 Gaming taxes based on stakes Current Player payout Gaming taxes F
Slide 11: Iconic product portfolio with unrivalled brand awareness of 97%
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Iconic product portfolio with unrivalled brand awareness of 97%1 85 games offered, of which 5 with annual stakes over €1bn Life changing with super jackpots
Slide 12: Asset-light distribution model with extensive territorial coverage
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Asset-light distribution model with extensive territorial coverage In thousands of PoS1 30 Strong partnerships with independent distributors 17 13 Commission
Slide 13: Digital revolution successfully embraced
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Digital revolution successfully embraced Fully digitalised ecosystem Digitalised stakes2 both online and offline €0.5bn €0.6bn €0.9bn €1.7bn €2.4bn As % of 15
Slide 14: Proprietary technology assets underpin strategy
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Proprietary technology assets underpin strategy Provide Efficient cost structure with selective 24/7 operations and strategic control internalisation of core
Slide 15: B2B international development backed by superior technology
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise B2B international development backed by superior technology Recent acquisition in Commercial achievements Sports Betting services Lottery LEIA Joint Venture1
Slide 16: Highly experienced and multi-talented management team with strong operational track record
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Highly experienced and multi-talented management team with strong operational track record 13 years average tenure Multi-talented Pierre-Marie Argouarch Valér
Slide 17: Proven ability to grow over the long term
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Proven ability to grow over the long term Stakes (€bn) Revenue (€bn) 2010-2018 CAGR: +5.2% 2010-2018 CAGR: +4.8% 15.8 15.1 1.8 1.8 14.3 1.7 1.7 13.7 13.0 1.5
Slide 18: Financial model overview: from Stakes to adjusted EBITDA
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Financial model overview: from Stakes to adjusted EBITDA From Stakes to Net Gaming Revenue From Revenue to EBITDA (as % of total stakes) (as % of total costs2
Slide 19: Lottery is the main contributor to topline and profitability, with Sports Betting in investment-mode
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Lottery is the main contributor to topline and profitability, with Sports Betting in “investment-mode” Stakes Revenue 2018 EBITDA breakdown (€m) As % of As %
Slide 20: Solid track record of EBITDA growth and margin expansion
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Solid track record of EBITDA growth and margin expansion EBITDA (€m) 2010-2018 CAGR: +8.8% EBITDA growth of approximatively 9% per year over 2010-2018 13% 14%
Slide 21: Cash-generative business model
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Cash-generative business model Key Features 2014-2018 cash conversion1 (in %) (based on 2018 figures) 85% 84% 82% 79% EBITDA €319m3 2 69% Change in Working Ca
Slide 22: Net cash position of €70m as of 30-Jun-2019 post equalisation payment
Differentiating assets Solid financial profile and Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise outlook Net cash position of €70m as of 30-Jun-2019 post equalisation payment In €m €380m equalisation 179 payment to be paid 874
Slide 23: FDJ 2025 ambition
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise FDJ 2025 ambition “Strengthen our leadership in the French Gaming market & Become a key international player in Games and Services” FDJ - Strictly confidentia
Slide 24: Well-balanced growth strategy across business lines
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Well-balanced growth strategy across business lines Consolidate growth Accelerate growth Develop additional growth Lottery Sports Betting Adjacent Activities
Slide 25: 3 common high level priorities to boost business lines strategy
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise 3 common high level priorities to boost business lines strategy Lottery Sports Betting Adjacent Activities High level priorities Further modernise and Develop
Slide 26: Selective M&A strategy mostly consisting in bolt-on acquisitions on a case-by-case basis
Differentiating Differentiatingassets assets Solid financial profile and Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and andproven provenexpertise expertise outlook Selective M&A strategy mostly consisting in bolt-on acquisitions on a case-by-cas
Slide 27: Restating 2018 EBITDA on a comparable basis vs. guidance
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Restating 2018 EBITDA on a comparable basis vs. guidance 2018 restated EBITDA 2018 restated for 2020 new gaming tax framework contribution margin Margin +€47m
Slide 28: 2019 guidance
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise 2019 guidance 2019 guidance Stakes Approximately €16.9bn Approximately €2.0bn, Consolidated based on new gaming tax framework and assuming accounting for 2019
Slide 29: Strong 9M 2019 results with sustained growth across business lines
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise Strong 9M 2019 results with sustained growth across business lines Stakes (€bn) Revenue (€bn) +7.8% €12.54bn +7.0% €11.64bn €2.56bn +13.8% €1.42bn €2.25bn €1.
Slide 30: 2020-2025 organic targets
Differentiating assets Scale Unique Businessrights under exclusive Model Solid financial profile Strong growth potential and proven expertise 2020-2025 organic targets 2020 targets 2025 targets Growth of between 4% and 5% vs. 2019, CAGR of between 3% and 4% over 2020-2025, Stakes targeting the highe
Slide 31: Lottery and Sports Betting in a nutshell – based on 2018 figures
Lottery and Sports Betting in a nutshell – based on 2018 figures Group Lottery Sports Betting % of total % of total Stakes €15.8bn €12.8bn €3.0bn 19% % digitalised1 15% 5% 81% 60% Stakes CAGR 2014-18 +5.0% +3.8% +11.4% Number of players 25m 24m 3.5m Average weekly stake per player €12.3 €10.2 €17