Tinexta Spa · MIL:TNXT
Tinexta Spa — Investor Presentation (September 2022)
57 slides from Tinexta Spa's investor presentation, Sep 8, 2022
Slide 1: Company Presentation
Company Presentation September 8-9, 2022
Slide 2: Agenda
Agenda 1 Company Overview 2 2021 Results + 1H 2022 Results 3 2022 – 2024 Plan 4 Appendix 2
Slide 3: Tinexta's Management
1 Tinexta’s Management PIER ANDREA CHEVALLARD ODDONE POZZI JOSEF MASTRAGOSTINO General Manager & Chief Executive Officer Group Chief Financial Officer Chief Investor Relations Officer ▪ Former CEO of Tecno Holding ▪ Group Chief Financial Officer and ▪ Head of Investor Relations ▪ General Secretary o
Slide 4: Tinexta's history & evolution
1 Tinexta’s history & evolution Tinexta has successfully grown into one of the largest qualified operators in the Financial Services sector in Italy Entrance in Spain + Tecno Holding Listing on AIM Italia Listing on the STAR Internationalization Cyber Security + France Sale of CIM 2009 2014-2015 201
Slide 5: Tinexta's Business: Key metrics FY'21
1 Tinexta’s Business Key metrics (FY’21, Restated) – 2022 Guidance restated for CI&M Revenues* EBITDA Adj.* NFP/EBITDA Adj. Net Profit FCF Dividend Employees €375M €99M 2.67x €40M >€55M €0.30 or 35% 2,259 €301.5M Restated €76.5M Restated of Net Profit +21-23% vs PY +25-27% vs PY c.0.6x Digital Trust
Slide 6: Pro forma Financials on 2021 Results by Business Unit
1 Pro forma Financials on 2021 Results by Business Unit CREDIT INFORMATION & INNOVATION & DIGITAL TRUST CYBER SECURITY MANAGEMENT MARKETING SERVICES Revenues €131M €73M €79M €95M EBITDA Adj. €36M €10M €23M €41M EBITDA Adj. Margin 28% 14% 29% 43% Pre transaction 2021 Pro forma 25% 32% 35% Revenues 44
Slide 7: Digital Trust – Snapshot
1 Digital Trust – Snapshot Business at a glance CAGRs: +23-31% Digital Trust Brands Market & Growth expectations p.a. ▪ Provides IT solutions for digital identity and the ▪ DTM/E-Signature market $640M (EU), $2.3B World dematerialization of processes according to the applicable legislation ▪ Digital
Slide 8: Cyber Security – Snapshot
1 Cyber Security – Snapshot Business at a glance CAGR: Cyber Security Brands Market & Growth expectations +8% p.a. ▪ Created a new player in the ▪ The Italian Cyber Security market (worth €2.1B) is expected to grow 8%* sector, to be the National Hub of per year. Cyber Security. ▪ Functional areas an
Slide 9: Innovation & Marketing Services – Snapshot
1 Innovation & Marketing Services – Snapshot Business at a glance Innovation & Marketing Services Main Brands Market & Growth trends ▪ The Budget Law 2021 in Italy introduced important corrections both in the area of R&D, Innovation, Design Tax Credit (from 2022) and in the area of Offers Consultanc
Slide 10: M&A: CIM's sale creates increased value for shareholders
1 M&A: CIM’s sale creates increased value for shareholders Tinexta Group sells - Credit Information & Management - to CRIF S.p.A. for a total Enterprise Value of € 237.5M • Deal and Structure considerations: - Tinexta sells to CRIF S.p.A. the Credit Information & Management business Unit (excluding
Slide 11: CIM's corporate structure
1 CIM’s corporate structure Closing completed August 3rd 2022 Conditions precedent: • Cedacri not to exercise REValuta Innolva Group Conditions precedent: • Intesa to allow the sale of the right of pre-emption its 25% stake to CRIF on REValuta following the transfer of • Golden Power Forvalue to Tin
Slide 12: Innolva's closing – Transaction details
1 Innolva’s closing – Transaction details (August 3rd 2022) Old shareholder structure: Cash € 226.8M* ii € 56.7M i € 170.1M* 1. Innolva sold 100% of Forvalue to Warrant Hub for an Equity Value of 25% €48.6M (@Fair Market Value July 2022) 75% 100% b) a) Warrant Hub owes Innolva the exact amount (€48.
Slide 13: The offer – Binding agreement to purchase CIM
1 The offer – Binding agreement to purchase CIM Innolva Group REValuta Total Majority stakes Credit Information & Perimeter Minority Management Division stakes (excl. ForValue) EV 100% €187.5M €50.0M €237.5M EV/EBITDA Adj. (2021A) 10.4x 12.5x 10.8x NFP (@March 31, 2022) €14.4M €(4.6)M €9.8M* Equity
Slide 14: NFP Bridge – Pro forma
1 NFP Bridge – Pro forma €M Strong deleverage 263.3 -171.5 0.7 0.5 32.6 -51.4 -8.9 2.7x NFP/EBITDA1 0.4x (1) Calculated NFP/Adjusted EBITDA FY’21 (for FY’21); Pro forma NFP/2021 Pro forma Adjusted EBITDA. 14
Slide 15: Results 2021 – Trend
1 Results 2021 – Trend Tinexta Group's Revenues grew at a 25.5% CAGR from 2014 to 2021. EBITDA Adjusted grew at a 36.6% CAGR over the same period. Revenues (€M) EBITDA Adjusted (€M) NFP (€M) NFP/EBITDA Adj.* 375.4* 2.67x 98.7* Considering Bregal’s investment of €70M completed on 3 February 2022: 85.
Slide 16: Results 2021 – Dividends
1 Results 2021 – Dividends Dividends Per Share (€) Overall Dividends (€M) 35.0% N 31.8% N 33.3% O O 13.8 0.30 12.0 D 11.0 D I 0.26 I V V 0.228 I 32.3% I D D E E N 6.5 N 34.9% D 23% 0.14 D S S 30.1% 4.0 0.088 P 0.08 P A 2.5 A I 0.047 I D 1.5 D 2014 2015 2016 2017 2018 2019 2020 2021 2014 2015 2016 20
Slide 17: Agenda
Agenda 1 Company Overview 2 2021 Results + 1H 2022 Results 3 2022 – 2024 Plan 4 Appendix 17
Slide 18: Performance 2021
2 Performance 2021 Achieved further growth in most Business Units strengthening the Group’s market position Created solid grounds for Cyber Security’s expansion; secured key clients/contracts Expanded the Group internationally by entering the French market in Digital Trust Entered in strategic partn
Slide 19: FY 2021 Another year of growth
2 FY 2021 Another year of growth • FY 2021 registered strong progress: - Revenues1 at € 375.4M (+39.5% vs PY, +7.7% on a 2020 base); - EBITDA Adjusted1 at € 98.7M (+21.5% vs PY, +2.7% on a 2020 base), EBITDA2 at € 93.0M (+19.4% vs PY, +1.5% on a 2020 base); - EBITDA Adjusted1 margin 26.3% (28.8% on
Slide 20: FY 2021 Consolidated Results
2 FY 2021 Consolidated Results 2021 Results show revenues of 375.4 million euros, EBITDA Adjusted of 98.7 million euros and Net Profit of 44.9 million euros. EBITDA Reported is 93.0 million euros • 2021 Results show a growth both in Revenues (+39.5%) and in EBITDA 375.4* Adjusted (+21.5%). These res
Slide 21: EBITDA Walkthrough
2 EBITDA Walkthrough EBITDA Adjusted WALKTHROUGH €M ca. €96M €98.7M ▪ Expected back-ended year EBITDA growth and overdelivered on all accounts c. 54 56.4 ▪ 2021 EBITDA Adjusted was €98.7M Mostly Covid, followed by rebound 46.3 46.0 ▪ Quarter on quarter performance is not 42.3 Margin representative o
Slide 22: FY 2021 Financial Results – FCF & NFP
2 FY 2021 Financial Results – FCF & NFP NFP FREE CASH FLOW €M Decrease is mainly Main Changes in 2021: 66.7 due to higher taxes 56.4 paid offset by 263.3 • - € 193.3M acquisitions continued Bregal’s Bregal • Corvallis: - € 56M improvement in investment of • Yoroi: - € 38.6M €70M completed 70.0 worki
Slide 23: Business Units Deep Dive – Overview FY 2021
2 Business Units Deep Dive – Overview FY 2021 DIGITAL TRUST CREDIT INFORMATION & MGMT €M 131.3 79.0 115.8 128.6 77.3 75.4 GROUP 36.4 22.8 31.0 35.2 23.7 22.0 2020 2021 2020 2021 2020 2021 2020 2021 REVENUES EBITDA Adj. REVENUES EBITDA Adj Perimeter 2020 Δ Perimeter Perimeter 2020 Δ Perimeter CYBER S
Slide 24: 1H'22 on path for delivery
2 1H’22 on path for delivery Data, and PY comparisons, are provided excluding CIM activities. Forvalue is included in IMS • 1H’22 results show support for growth and year end outlook: - Revenues at € 168.0M in 1H’22 (+ 20.2% vs PY); - EBITDA Adjusted at € 37.1M in 1H’22 (+ 20.6% vs PY) mainly driven
Slide 25: 1H'22 Results
2 1H’22 Results Data, and PY comparisons, are provided excluding CIM activities. Forvalue is included in IMS The First Half 2022 shows Revenues of 168.0 million euros, EBITDA adjusted of 37.1 million euros and Net Profit from continuing operations of 13.3 million euros. EBITDA Reported is 32.6 milli
Slide 26: 1H'22 Financial Results – NFP & FCF
2 1H’22 Financial Results – NFP & FCF NFP FREE CASH FLOW from continuing operations Main Changes in 1H’22: • - € 60.8M acquisitions 266.7 • Evalue: - € 33.9M 263.3 • Enhancers: - € 21.3M • Sferabit: - € 3.1M • Nomesia: - € 0.9M 23.0 21.5 • Others: - € 1.6M 0.7 6.9 • - € 19.4M Dividends Non recurring
Slide 27: Business Units Deep Dive – Overview 1H'22
2 Business Units Deep Dive – Overview 1H’22 Data, and PY comparisons, are provided excluding CIM activities. Forvalue is included in IMS €M DIGITAL TRUST INNOVATION & MKT SERVICES 76.9 55.4 GROUP 63.6 68.8 46.3 20.0 21.1 41.7 18.0 17.1 17.1 15.6 1H 2021 1H 2022 1H 2021 1H 2022 1H 2021 1H 2022 1H 202
Slide 28: Agenda
Agenda 1 Company Overview 2 2021 Results + 1H 2022 Results 3 2022 – 2024 Plan - 2022 – 2024 Plan - 2022 – 2024 Plan + M&A 4 Appendix 28
Slide 29: Key pillars of our strategy – 2022-2024 Plan
3 Key pillars of our strategy – 2022-2024 Plan Strengthen our leadership in Continue to leverage on Selective M&A + our reference markets strong organic growth Internationalization 1 2 3 People & Organization Increase integration + Laser focused financial policy ESG 4 5 6 PNRR «Piano Nazionale di Ri
Slide 30: Key pillars of our strategy 1/6
3 Key pillars of our strategy – 2022-2024 Plan 1/6 ➢ Strengthen market presence via vertical integration in: ❖ Digital Trust ❖ Cyber Security ❖ Digital Innovation Strengthen our leadership in ❖ Digital Marketing our reference markets ➢ Grow presence in the Public Administration market 1 ➢ Foster cro
Slide 31: Key pillars of our strategy 2/6
3 Key pillars of our strategy – 2022-2024 Plan 2/6 ➢ Strong sector organic growth yields continuous momentum for Tinexta Continue to leverage on ➢ The markets in which the Group operates are growing at attractive rates strong organic growth ➢ The Group’s product offering is constantly fine tuned to
Slide 32: Key pillars of our strategy 3/6
3 Key pillars of our strategy – 2022-2024 Plan 3/6 Major M&A Stringent criteria Digital Trust Credit Information & Mgmt Solid Business Fundamental Only Selective M&A with key strategic criteria to enter Tinexta Growing market segment Group Selective M&A + Strategic Fit & Finish Internationalization
Slide 33: Key pillars of our strategy 4/6
3 Key pillars of our strategy – 2022-2024 Plan 4/6 ➢ Centralized CRM ➢ Group Sales & Marketing enables: ❖ Central coordination for the development of an integrated offer of the Group and the related “go to market” ❖ Streamlining the newly instituted Forvalue channel to strengthen the Increase integr
Slide 34: Key pillars of our strategy 5/6
3 Key pillars of our strategy – 2022-2024 Plan 5/6 Group FTE & by BU ➢ Higher growth of employment - driven by business expansion (mainly M&A) - 2259 requires solid grounds of project analysis and involves the redefining of the: 1272 1285 ❖ Organization & integration of People & Organization process
Slide 35: Key pillars of our strategy – ESG
3 Key pillars of our strategy – 2022-2024 Plan - ESG 5/6 Environment, Social & Governance Key accomplishments in 2021 What to expect Beyond 2022 Main activities: Environmental Social ✓ From Compliance to Engagement ▪ Benchmark ✓ Performed Benchmark ESG with Gap analysis to better ▪ Gap Analysis unde
Slide 36: Key pillars of our strategy 6/6
3 Key pillars of our strategy – 2022-2024 Plan 6/6 ➢ Continue to focus on Cash Flow constantly applying a “Cash is King” approach ➢ Attractive leverage ratio ❖ Pro-forma leverage ratio for Bregal’s investment yields competitive Laser focused financial policy ratios ➢ Strong attention to cost 6 ➢ Env
Slide 37: Key pillars of our strategy – PNRR
3 Key pillars of our strategy – 2022-2024 Plan PNRR PNRR Funding (€B) PNRR Allocations (€M) Recovery Plan - PNRR «Piano Nazionale di Ripresa e Resilienza» 7 ➢ Among the PNRR’s priorities, Digitalization assumes a pivotal role of role and Tinexta is expected to strongly benefit from it in an indirect
Slide 38: Key pillars of our strategy – PNRR
3 Key pillars of our strategy – 2022-2024 Plan PNRR Italy & Digitalization: 4 critical aspects that deserve top priority Low digitalization of the economy and society Italy 25th in the European Commission's DESI digitization index Recovery Plan - PNRR Skills shortage Delays in the digitalization of
Slide 39: 2022-2024 Plan – Priorities for superior shareholder return
3 2022-2024 Plan – Priorities for superior shareholder return Improve operational efficiency by increasing the Continued growth in quality revenues EBITDA Margin of the Group a) b) Improving EPS as well as growing DPS Strong cash generation and robust balance sheet c) d) c) 39
Slide 40: Revenue growth driven by organic growth and M&A
3 a) Revenue growth driven by significant organic growth and M&A In May 2022, disposal of the CIM division; completed the closing of Innolva in August 2022 Organic Growth M&A • Continued acquisition strategy in selected • Continue to expect strong market growth countries: following a strong 2021 • F
Slide 41: Profitability driven by sector growth & operating leverage
3 b) Profitability driven by sector growth & operating leverage The drivers of profitability Fuel for growth • People • Local and International scale • Attracting, rewarding and retaining • Operating leverage talent • Cross-selling + potential synergies • Change Management (awareness, • Centralized
Slide 42: EPS growth & DPS
3 c) EPS growth & DPS D&A Financial Expenses Taxes • Ratio on revenues in line with prior • ~ 1% all-in average cost of debt • In line with recent years years DPS (€) EPS Adj. (€) 0.26 0.87 0.228 0.82 0.77 No dividends paid 0.140 0.47 0.42 0.37 0.080 0.088 0.047 0.14 2014 2015 2016 2017 2018 2019 20
Slide 43: Sustained cash flow generation and robust balance sheet
3 d) Sustained cash flow generation and robust balance sheet Proceeds from CIM’s sale increase noticeably the already high cash-out firepower Operating Cash Flow Capex Cash-out for M&A • Continued sustained pace of acquisitions in selected markets: • Continued strong cash conversion • France, Spain,
Slide 44: 2022 Guidance
3 2022 Guidance Data, and PY comparisons, are provided excluding CIM activities. Forvalue is included in IMS ✓ Strong 2H’22 performance expected, Guidance confirmed Guidance* 2022 (Like for Like) 2022 (with acquisitions) Revenues ~ 10-12% growth vs PY ~ 21-23% growth vs PY EBITDA Adjusted ~ 8-10% gr
Slide 45: Digital Trust – Business Plan 2022-2024
3 Digital Trust – Business Plan 2022-2024 The Three-Year Plan on an organic basis provides a growth in revenues of around 10% and in EBITDA Adjusted of around 14%, with acquisitions Revenue growth is c. 14% and EBITDA Adjusted growth c. 18% Revenues (€M) EBITDA Adj. (€M) Acquisition (CERTEUROPE) Acq
Slide 46: Cyber Security – Business Plan 2022-2024
3 Cyber Security – Business Plan 2022-2024 The Three-Year Plan provides for revenue growth of approximately 19% and EBITDA Adjusted growth of approximately 31% Revenues (€M) EBITDA Adj. (€M) 72.8 10.1 2021 2022E 2023E 2024E 2021 2022E 2023E 2024E The 2022-2024 Plan is based on various assumptions, e
Slide 47: IMS – Business Plan 2022-2024
3 IMS – Business Plan 2022-2024 The Three-Year Plan on an organic basis (i.e., constant perimeter) forecasts revenue growth of approximately 7% and EBITDA Adjusted growth of c. 5%. Including recent acquisitions, revenues will grow by around 11% and EBITDA will grow by c. 10% Revenues (€M) EBITDA Adj
Slide 48: Agenda
Agenda 1 Company Overview 2 2021 Results + 1H 2022 Results 3 2022 – 2024 Plan - 2022 – 2024 Plan - 2022 – 2024 Plan + M&A 4 Appendix 48
Slide 49: M&A: The track record
3 M&A: The track record • A consolidated track record in delivering accretive M&A • Since 2013 Tinexta has completed 27 M&A Deals for a total investment of about €450M • Divested the Credit Information & Management division for €237.5M (EV) or c.11x EV/Adj. EBITDA 2020 2021 2022 Sep Oct Dec Jan Jun
Slide 50: Agenda
Agenda 1 Company Overview 2 2021 Results + 1H 2022 Results 3 2022 – 2024 Plan 4 Appendix 50
Slide 51: FY 2021 Financial Results – Income Statement
4 FY 2021 Financial Results – Income Statement w/acquisitions 2021 LFL 2020 FY 2021 on FY 2021 % FY 2020 % % Δ Δ% Δ Δ% 2020 Revenues 375.4 100.0% 269.0 100.0% 289.8 100.0% 106.3 39.5% 20.8 7.7% Total Operating Costs 276.6 73.7% 187.8 69.8% 206.4 71.2% 88.8 47.3% 18.6 9.9% Service & Other Costs 138.9
Slide 52: 1H'22 Financial Results – Income Statement
4 1H’22 Financial Results – Income Statement Data, and PY comparisons, are provided excluding CIM activities. Forvalue is included in IMS w/acquisitions 2022 LFL 2021 1H 2022 on 1H 2022 % 1H 2021 % % Δ Δ% Δ Δ% 2021 Revenues 168.0 100.0% 139.7 100.0% 150.9 100.0% 28.3 20.2% 11.1 8.0% Total Operating
Slide 53: 1H'22 Financial Results – Balance Sheet
4 1H’22 Financial Results – Balance Sheet 581.2 Net 506.4 Net Invested Capital grows by € 74.7 million compared to 31 December 2021 as a Invested + 14.8% result of the acquisitions and of a new leasing contract that resulted in an increase in net non-current assets of € 72.0 million, Net Working Cap
Slide 54: Balance Sheet – The pro forma post CIM sale
4 Balance Sheet – The pro forma post CIM sale Net 507 Invested - 27% Capital 372 ➢ Considerably lower Net Invested Capital FY 2021 FY'21 Pro forma provides increased flexibility on the Balance Sheet Net 263 ➢ Significant improvement in Net Financial Financial Position allows increased M&A firepower
Slide 55: The Group today
4 The Group today 88.17% 100.0 % 100.0 % 95.0 % 100.0 % 100.0% 100.0 % 80.0 % 100.0 % 60.0% 100.0 % 60.0 % 51.0 % 100.0 % 51.0 % 99.99 % 100.0 % Perù 70.0% 60.0 % 50.0 % 100.0 % 100.0 % 70.0 % 70.0 % 100.0 % 100.0 % 100.0 % Innovation and Digital Trust Cyber Security Credit Information and Managemen
Slide 56: Disclaimer
Disclaimer • This document was prepared by Tinexta Spa (the “Company”) for the sole purpose of presenting the performance and the activities of the Company. • The information provided with this document does not contain nor constitute an offer of securities for sale, or the solicitation of an offer
Slide 57: Investor relations
Investor relations: investor@tinexta.com