Two Point Zero Group Pjsc · ADX:2POINTZERO
Two Point Zero Group Pjsc — Multiply Group — Q3 2024 Earnings Presentation
54 slides from Two Point Zero Group Pjsc's earnings presentation, October 2024
Slide 1: Q3 2024 Results Presentation
Q3 2024 Results Presentation October 2024
Slide 2: Agenda
Investment Strategy update 1 Delivering on our Priorities 2 Agenda 3 Financial performance Vertical performance 4 Appendix 5
Slide 3: Disclaimer
Disclaimer Multiply Group (“Multiply”) prepared this presentation on a proprietary basis as general background information about the activities of Multiply. The information contained herein is given in summary form and for discussion purposes only. Some of the information that is relied upon by Mult
Slide 4: Investment Strategy Update
Investment Strategy Update
Slide 5: Our Investment Strategy | Recap
Our Investment Strategy | Recap Deploying capital across 2 distinct arms adhering to a disciplined investment approach Vertical Building Minority Investments Consolidate steady and predictable cash Target high-potential, financially flow businesses in select verticals, that MULTIPLY+ outstanding inv
Slide 6: Our Investment Strategy | Key Milestones
Our Investment Strategy | Key Milestones 2022-2023 9M 2024 Vertical building Vertical building A portfolio of majority-owned subsidiaries in a diversified and balanced selection Continued focus on generating value through EBITDA consolidation, value of sectors: Utilities, Mobility, Media & Comms
Slide 7: Delivering on our Priorities
Delivering on our Priorities 1 3
Slide 8: Delivering on our Priorities
Delivering on our Priorities KEY PRIORITIES List the Media Efficiencies Inorganic Growth Vertical Create up to AED 45mn Deploy up to AED 5bn in new Prepare the media vertical for a EBITDA uplift across our acquisitions potential listing to unlock value existing businesses ► Deployed ~AED 1bn across
Slide 9: Where are we today? Key Highlights for YTD 2024
Where are we today? Key Highlights for YTD 2024 Accelerated efficiency Consolidated 3 acquisitions: Welcomed IHC’s CEO & Strategic extraction across our Backlite (Media), TGCH (Beauty) Managing Director, Syed Updates operating companies and Excellence Driving (Mobility) Basar Shueb, as new Chairman
Slide 10: Q3'24 Financial Performance
Q3’24 Financial Performance
Slide 11: Group P&L performance
Group P&L performance 518 484 Revenue growth on positive Adjusted EBITDA2 of AED 436 million 436 contribution across all 4 verticals1 352 was driven by strong operational (+9% organic growth) further boosted performance of core verticals with blended by the consolidation of The Juice GP margin at 44
Slide 12: Healthy cash generation
Healthy cash generation Strong net OCF on cash-generating ..resulting in healthy OCF operating businesses and prudent 958 margin1 working capital management.. 71% 539 60% 9M'23 9M'24 9M'23 9M'24 Increased contribution from ..further supported by the value 29.3 bn Vertical Assets as we focus on 47% 5
Slide 13: Robust balance sheet supporting our investment growth strategy
Robust balance sheet supporting our investment growth strategy Reasonable leverage with Net Debt / Equity 0.28x Gross debt of AED 9.68bn Net debt of AED 7.8bn Healthy Cash balance AED 1.9 bn AED 20.5 bn Deployed capital to-date ~ 5.0% Relatively low average funding cost amid As of 30 Sept 2024 a hig
Slide 14: Q3'24 Vertical Performance
Q3’24 Vertical Performance
Slide 15: Diversified portfolio across core verticals
Diversified portfolio across core verticals Vertical building strategy bearing fruits ..with healthy blended gross profit margin with positive YoY growth across all 4 (44%) from operating businesses reflecting verticals.. the change in revenue mix Q3’24 Revenue Split Q3’24 Gross Profit Split 12% 22%
Slide 16: Energy and Utilities
Energy and Utilities1 19% of Group Revenue Revenue Gross Profit Commentary 98 93 45 43 Revenues Profitability EBITDA of AED 73mn includes: Q3'23 Q3'24 Q3'23 Q3'24 +5% YoY driven by PCH’s new connections AED 25mn share of profit from Kalyon JV (vs. AED 158mn and tariff changes last year) on unfavoura
Slide 17: Mobility
Mobility1 32% of Group Revenue Revenue Gross Profit Commentary 164 96 111 79 Revenue Profitability EBITDA of AED 100mn reflects: +70% YoY largely driven by the consolidation The consolidation of Excellence Driving Center, a Q3'23 Q3'24 Q3'23 Q3'24 of Excellence Driving Center in July’24 prominent dr
Slide 18: Media and Communications
Media and Communications1 22% of Group Revenue Revenue Gross Profit Commentary 113 76 31 27 Revenue Profitability Q3’24 revenues included the consolidation of Slower than expected summer season coupled with Q3'23 Q3'24 Q3'23 Q3'24 Backlite adding AED 33mn change in revenue mix with increased contrib
Slide 19: Wellness & Beauty
Wellness & Beauty1 27% of Group Revenue Revenue Gross Profit Commentary 142 87 45 25 Revenues Profitability +64% YoY largely driven by the consolidation Enhanced profitability across board was largely driven by Q3'23 Q3'24 Q3'23 Q3'24 of The Juice Spa & Salon in Q4’24 and TGCH efficiency improvement
Slide 20: Closing Remarks
Closing Remarks INVESTOR PRESENTATION 25
Slide 21: Value Creation Model at the Holding Level
Value Creation Model at the Holding Level Access to high-profile deals 1 Supportive ecosystem brings in multiple synergies Financial flexibility on a wide network of lending banks Attracting high-caliber talent Attractive sectors disrupted by favourable megatrends 2 Clear framework to identify targe
Slide 22: Q&A
Q &A
Slide 23: Appendix
Appendix
Slide 24: A transformative journey
A transformative journey
Slide 25: The beginning of a remarkable journey from a boutique marketing consultancy agency
The beginning of a remarkable journey from a boutique marketing consultancy agency... Multiply Acquisition of Founded by our current CEO, the company started out Research additional 15% as Multiply Marketing Consultancy (MMC), growing Company in Viola organically into one of the leading communicatio
Slide 26: ..to one of the largest diversified holding company in the region
..to one of the largest diversified holding company in the region Acquisition of 100% AED in PAL 42.2bn IHC Cooling ADX Listing acquired Holding (AED 1.11/ Acquisition 90% in share) of 80% Omorfia in IEH Multiply (50% in AED $ 100mn acquired 30.6bn invested in 100% Kalyon in The Enerji) Breakwater E
Slide 27: Our growth story
Our growth story Revenue Adjusted EBITDA* AED ~3.5x 1.6bn AED ~7.6x in 2 years 1.3bn 2 in 2 years2 2021 2023 2021 2023 Total Assets Market Cap3 Liquidity4 > AED ~ AED > AED 40bn 25bn 50mn *Adjusted EBITDA = Group Net profit + net finance cost + Depreciation & Amortization - Fair Value gains / losses
Slide 28: Today's diversified portfolio
Today’s diversified porfolio 51% EARNINGS PRESENTATION 28
Slide 29: Established platform for further scaling
Established platform for further scaling Total renewable installed capacity: 1.5GW (all solar) | +490MW by end of 2025 (wind and solar) District cooling plants: 6 | Connected Capacity: 165k RT Number of vehicles: ~400 Number of students: >120,000 in 2023 Total number of assets: 1,500+ (excluding tra
Slide 30: Investment Strategy
Investment Strategy 1 6
Slide 31: Our Vertical Building Investment Strategy
Our Vertical Building Investment Strategy Up to AED 5bn to deploy into our Vertical Building Investment strategy Objective Buy-outs of leading strong cash generating businesses in proven solid industries Generate value through EBITDA consolidation, dividend generation, value appreciation and synergi
Slide 32: Vertical Investments | YTD'24
Vertical Investments | YTD’24 Description Rationale Consideration Metrics ► A global reference in the Digital ► Penetrating the rapidly growing digital OOH ► Revenue AED 250mn OOH advertising space media sector ► Leading partner with the Roads ► Integrating Backlite’s innovative solution into AED 47
Slide 33: A disciplined approach to sector selection
A disciplined approach to sector selection Sectors where Multiply can become the Strategic sectors with healthy market size growth regional leading investor Sectors with high capital efficiency Sectors where Emerging Markets (profitability, CAPEX requirements, cash are making a difference generation
Slide 34: Our Multiply+ Investment Strategy
Our Multiply+ Investment Strategy Objective Sector-agnostic minority investments with outstanding financial returns Asset Classes Public Companies Private Companies Fundamentally strong listed companies available at Private businesses with a strong dividend profile and a clear Rationale valuation up
Slide 35: Media Vertical Potential Listing
Media Vertical Potential Listing
Slide 36: Preparing the Media & Communications Vertical for a public listing
Preparing the Media & Communications Vertical for a public listing Consolidation Growth history Multiply Acquisition Acquisition of 100% in Investments Acquisition of Acquisition of Marketing of 35% in of 15% in Viola in Firefly 60% in 100% in Consolidation of leading Consultancy Viola Viola Backlit
Slide 37: 2024 Growth Drivers
2024 Growth Drivers
Slide 38: 2024 Growth Drivers
2024 Growth Drivers 2024 2023 Key growth drivers Strong vertical fundamentals Efficiencies and Synergies Energy & Utilities Mobility Media & Comms Beauty & Wellness Up to AED 45mn (run rate)* • Global district cooling market • Global mobility solutions is • Global ad market set to grow • Global beau
Slide 39: Key Initiatives: Year of Efficiency
Year of Efficiency > AED 25mn realized efficiency gains to-date Revenue Cost Digital Transformation ► Leveraging market leadership: Capturing more wallet share ► Strategic sourcing: Conducting a comprehensive procurement ► Enhancing operational efficiency: Automating back-end Key Initiatives in the
Slide 40: Beyond the headlines: Adjusted vs Reported Earnings fact check
Beyond the headlines: Adjusted vs Reported Earnings fact check AED MN Adjusted Group Net Profit1 IFRS Group Net Profit we are required to report Full year 2022 468 18,563 Full year 2023 1,114 552 9M’24 920 -2,508 Adjusted earnings provide a clearer view by focusing on the operational performance of
Slide 41: Snapshot per Vertical
Snapshot per Vertical
Slide 42: Energy & Utilities
Energy & Utilities Multiply Group Industry District cooling: • Renewable energy • Global district cooling market is set to grow at 8% CAGR Plays • District cooling (+ heating) Facts • UAE has ~4M of RT, and is expected to grow at a CAGR of 10% • Energy services • Continued growth of UAE population a
Slide 43: Mobility
Mobility Multiply Group Industry • Mobility education • Maintenance and • The global mobility solutions market size is estimated at servicing Plays • Car sales and leasing Facts $1.2tn in 2022 and is expected to grow at a 5% CAGR • Mobility-as-a-service and • Insurance and financing • Continued grow
Slide 44: Media & Communication
Media & Communication Multiply Group Industry • Global ad market in 2023 is ~$650bn and is expected to grow at a • D/OOH Media Portfolio CAGR of 5% Plays • Digital advertising Facts • Integrated service offering • The Middle East Ad market is ~$7bn in 2024 and is expected to be the fastest expanding
Slide 45: Wellness & Beauty
Wellness & Beauty Multiply Group Industry • Beauty Services • Mental health • Global beauty market is ~$750b and expected to grow by 4% • Physical Fitness Facts Plays • Beauty Products • The UAE beauty market is ~$3b and expected to grow by 6% • Corporate wellness services • The UAE is one of the hi
Slide 46: Multiply+ Snapshot
Multiply+ Snapshot Selected strategic investments under M+ Company Industry Footprint Description Investment Rationale One of largest listed integrated utility companies in EMEA with Global presence and AED 10 bn Attractive valuation & Taqa Energy & Utilities (7.3% holding) in ambitious growth plans
Slide 47: Capability and know-how
Capability and know-how 35
Slide 48: Experienced Board of Directors
Experienced Board of Directors SAYED BASAR SHUEB H.E. HAMAD H.E. MANSOOR AL RICK GERSON SAMIA BOUAZZA KHALFAN ALI MANSOORI MATAR AL-SHAMSI Chairman of the Board Board Member Board Member Board Member CEO & Board Member Notable CEO & Managing Director at Vice Chairman Ghitha Member of the Abu Dhabi C
Slide 49: An experienced management team
An experienced management team… Samia Bouazza Jose Maria Dot Naveed Khan Group CEO, Managing Director Chief Investment Group Finance & Board Member Officer Director Years of >20 years 20 years 15 years experience Notable experience Mehdi Bizri Omar Fayed Lama Al Bachir Mezier Briefkani Kaiser Geelan
Slide 50: Supported by vertical leads with deep insights
…supported by vertical leads with deep insights Jawad Hassan Media and Communitation Head of Media vertical Years of 25 years experience Areas of | Crafting strategic marketing plans expertise | Evaluating acquisitions for scaling growth Mobility | Building media ecosystems Ammar Sharaf Smitta Ozha
Slide 51: Supported by vertical leads with deep insights (cont'd)
…supported by vertical leads with deep insights (cont’d) Media and Khalid Bin Aamer Communitation Alshemeili Dr. Murtaza Ata Muhammad Zafar CEO of Emirates CEO of Kalyon Enerji CEO of PAL Cooling Driving Company Holding Years of 23 years >30 years 25 years experience Mobility Areas of | Setting long
Slide 52: ESG Highlights
ESG Highlights 40
Slide 53: Sustainability framework
Sustainability framework Pillar 1: Robust Foundations Pillar 2: Growing our Human Capital Objectives Objectives Enhance governance structure for a sustainable performance while Position Multiply as an employer of choice, emphasising integrating ESG into organisational risk management workplace d
Slide 54: IR Contact Details
IR Contact Details Contact Multiply Investor Relations for any questions Sahar Srour, CFA +971 54 513 9204 sahar@multiply.ae