Slide 1: Management Presentation Fourth Quarter 2018 Results
March 15, 2019 Management Presentation Fourth Quarter 2018 Results
Slide 2: Forward Looking Statements & Other Information
1 FORWARD LOOKING STATEMENTS & OTHER INFORMATION This presentation contains forward - looking statements . Statements in this presentation that are not historical facts, including without limitation statements about the Company’s beliefs and expectations, earnings guidance, recent business and econo
Slide 3: Summary
2 SUMMARY Note: See appendix for definitions of non - GAAP measures » Revenue impacted by client reductions and deferrals; Strongest net new business wins in two years give visibility to improved revenue growth in 1Q » Adjusted EBITDA impacted by the cost of implementing new accounting rules, as wel
Slide 4: Fourth Quarter 2018 Highlights
3 » Adopted ASC 606 effective January 1, 2018 using the Modified Retrospective Method, therefore reported results are not comparable with the prior period (which continues to be reported under ASC 605). See slide 6 for a reconciliation. » Revenue of $393.7 million versus $402.7 million (as reported
Slide 5: Full Year 2018 Highlights
4 » Adopted ASC 606 effective January 1, 2018 using the Modified Retrospective Method, therefore reported results are not comparable with the prior period (which continues to be reported under ASC 605). See slide 6 for a reconciliation. » Revenue of $1.48 billion versus $1.51 billion (as reported un
Slide 6: Consolidated Revenue and Earnings
5 CONSOLIDATED REVENUE AND EARNINGS 1 Effective January 1, 2018, we adopted ASC Topic 606, “Revenue from Contracts with Customers” (ASC 606). As a result, comparat ive prior periods have not been adjusted and continue to be reported under ASC 605 "Revenue Recognition" (ASC 605). We have provided a r
Slide 7: Impact of Adoption of ASC 606 on Reported Results
6 IMPACT OF ADOPTION OF ASC 606 ON REPORTED RESULTS 1 Adjusted EBITDA is a non - GAAP measure. See appendix for the definition. 2 The above table summarizes the impact of the adoption of ASC 606 on our US GAAP and non - GAAP performance metrics. Note: Actuals may not foot due to rounding. (US$ in mi
Slide 8: Revenue Summary
7 » Organic revenue decline of 0.3%, including a 305 basis point benefit from billable pass - through costs incurred on clients’ behalf REVENUE SUMMARY 1 Impact of adoption of ASC 606: In accordance with the adoption of ASC 606, we were required to change certain aspects of our rev enue recognition
Slide 9: Revenue by Geography and Segment
8 REVENUE BY GEOGRAPHY AND SEGMENT 1 Due to changes in the Company’s internal management and reporting structure during 2018, reportable segment results for 2017 pre sented have been recast to reflect the reclassification of certain businesses between segments. The changes were as follows: 1) Source
Slide 10: Revenue by Client Industry
9 Year - over - Year Growth by Category » Top 10 clients remained flat at approximately 23% of revenue versus a year ago (largest <5%) REVENUE BY CLIENT INDUSTRY Note: Actuals may not foot due to rounding. Year - over - year category growth shown on a reported basis, normalized for the impact of ado
Slide 11: Adjusted EBITDA
10 ADJUSTED EBITDA 1 Adjusted EBITDA is a non - GAAP measure. See appendix for the definition. 2 Due to changes in the Company’s internal management and reporting structure during 2018, reportable segment results for 2017 hav e been recast to reflect the reclassification of certain businesses betwee
Slide 12: Summary of Cash Flow
11 SUMMARY OF CASH FLOW 1 Effective January 1, 2018, we adopted ASU 2016 - 15, "Statement of Cash Flows", which clarifies how cash receipts and cash payment s in certain transactions are presented and classified on the statement of cash flows. We applied ASU 2016 - 15 on a retrospective basis, and a
Slide 13: Appendix
12 APPENDIX
Slide 14: Revenue Trending Schedule
13 REVENUE TRENDING SCHEDULE Note: See appendix for definitions of non - GAAP measures Note: Actuals may not foot due to rounding (US$ in thousands, except percentages) Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 YTD Revenue United States $252,199 $272,992 $274,506 $304,016 $1,103,712 $274,682 $304,46
Slide 15: Adjusted EBITDA Trending Schedule
14 ADJUSTED EBITDA TRENDING SCHEDULE 1 Adjusted EBITDA is a non - GAAP measure. See appendix for the definition 2 Prior to 2017, Adjusted EBITDA included an additional adjustment for acquisition deal costs. Beginning with 2017, on a prospe cti ve basis we no longer include the acquisition deal cost
Slide 16: Reconciliations
15 RECONCILIATIONS (US$ in millions) Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 YTD Non-GAAP acquisitions (dispositions), net GAAP revenue from current year acquisitions -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ -$ 11,066$ 12,734$ 12,317$ 36,117 GAAP revenue from prior year acquisitions * 6,556 2,817 17,083 24,6
Slide 17: Available Liquidity
16 AVAILABLE LIQUIDITY 1 1 Subject to available borrowings under the Credit Facility. Note: Actuals may not foot due to rounding (US$ in millions) December 31, 2018 December 31, 2017 Commitment Under Facility $325.0 $325.0 Drawn 68.1 - 30.0$ 30.0$ Undrawn Letters of Credit 4.7 5.1 Undrawn Commitment
Slide 18: Current Credit Picture
17 CURRENT CREDIT PICTURE 1 These ratios and measures are not based on generally accepted accounting principles and are not presented as alternatives mea sur es of operating performance or liquidity. Some of these ratios and measures include, among other things, pro forma adjustments for acquisition
Slide 19: Senior Secured Revolving Credit Facility Amendment
18 SENIOR SECURED REVOLVING CREDIT FACILITY AMENDMENT On March 12, 2019, the Company entered into an amendment (the “Amendment”) to the existing senior secured revolving credit facility, dated as of May 3, 2016 (as amended, the “Credit Agreement”). The Amendment provides financial covenant relief by
Slide 20: Temporal Put Obligations and Impact on Adjusted EBITDA
19 TEMPORAL PUT OBLIGATIONS AND IMPACT ON ADJUSTED EBITDA 1 This amount is in addition to (i) $31.5 million of options to purchase only exercisable upon termination not within the contr ol of the Company, or death, and (ii) the excess of the initial redemption value recorded in Redeemable Noncontrol
Slide 21: Definition of Non-GAAP Measures
20 DEFINITION OF NON - GAAP MEASURES Note: A reconciliation of non - GAAP to US GAAP reported results has been provided by the Company in the tables included in the earnings release issued on March 15, 2019. In addition to its reported results, MDC Partners has included in its earnings release and s
Slide 22: MDC Partners contact details
MDC Partners Innovation Center 745 Fifth Avenue, Floor 19 New York, NY 10151 646 - 429 - 1800 www.mdc - partners.com