Karnov Group Ab · OMXSTO:KAR
Karnov Group Ab — Q4 2019 Earnings Presentation
23 slides from Karnov Group Ab's earnings presentation, Feb 21, 2020
Slide 1: Fourth quarter 2019
Fourth quarter 2019 Q4 Flemming Breinholt, CEO and Dora Brink Clausen, CFO | 21 February 2020 Q4 2019 PRESENTATION 1
Slide 2: Q4 highlights and operational update
Q4 highlights and operational update Flemming Breinholt Q4 2019 PRESENTATION 2
Slide 3: Financial highlights
Financial highlights In line with medium-term financial targets +6% +4% +0.2 pp 2.7 Net sales Organic growth Adjusted EBITA Leverage margin Q4 2019 PRESENTATION 3
Slide 4: Operational highlights
Operational highlights Completed roll-out of JUNO Key comments All users are onboarded Old platforms are closed down Based on user feedback still deploying enhancements during 1H 2020 JUNO platform to be used to upgrade the Danish offering Q4 2019 PRESENTATION 4
Slide 5: Market offensive initiated in Denmark
Market offensive initiated in Denmark Key comments to Q4 and FY 3% organic growth in Q4 and FY – according to expectations Focus on renewal of customer contracts with normal good outcome Market offensives started including: Upgrade of Danish offering Collaboration with law firm in promoting e-course
Slide 6: Strong performance in Sweden
Strong performance in Sweden Key comments to Q4 and FY 5% organic growth in Q4 and 6% for the FY – according to expectations JUNO roll-out completed User feedback on JUNO – deploying enhancements for 1H 2020 AI-based recommendation function released in the end of Q4 for Notisum Key comment after Q4
Slide 7: Focus onwards
Focus onwards Adding more value for our customers Knowledge/information Key comments Strong performance in online Online growth more than offset the Adding even more value gives our offline decline – as expected users certainty and more efficiency. Investments in two start-up companies Focus on addi
Slide 8: Financial development
Financial development Dora Brink Clausen Q4 2019 PRESENTATION 8
Slide 9: Increased net sales and organic growth
Increased net sales and organic growth …FY and Q4 growth met expectations GROUP Net Sales, SEKm Net Sales, SEKm +6% +6% 800 700 200 600 150 500 400 100 300 200 50 100 715 757 179 189 0 0 FY 2018 FY 2019 Q4 2018 Q4 2019 Q4 2019 PRESENTATION 9
Slide 10: Improved adj. EBITA profit & margin for FY
Improved adj. EBITA profit & margin for FY GROUP Adjusted EBITA, SEKm and Adjusted EBITA, SEKm and margin % margin % +0.2 -2.5 pp pp 300 36.8% 80 36.6% 250 70 33.9% 31.4% 60 200 50 150 40 100 30 20 50 262 279 10 61 59 0 0 FY 2018 FY 2019 Q4 2018 Q4 2019 Q4 2019 PRESENTATION 10
Slide 11: Continued steady sales growth
Continued steady sales growth … due to strong online performance GROUP Net Sales, SEKm Key comments +5.8% Net sales growth of 5.8% 200 Organic growth of 4.1% and currency effects of 1.7%. 150 Online sales steady growth Offset the declining offline market 100 Both DK and SE contributed to higher sale
Slide 12: Flat adj. EBITA – due to market investments
Flat adj. EBITA – due to market investments GROUP Adjusted EBITA and margin, SEKm and % -2.5 Key comments 90 pp 80 Adjusted EBITA 59 MSEK vs. 61 MSEK 70 Adjusted EBITA margin declined 2.5 pp due to our active decision to take costs to prepare our 60 new market offensive in Denmark 50 39% 40% 42% 39%
Slide 13: Online sales growing according to expectations
Online sales growing according to expectations SALES SPLIT Sales split online/offline, % Sales split subscription/non-subscription, % 100% 100% 17% 15% 16% 14% 26% 23% 24% 21% 80% 80% 60% 60% 74% 77% 76% 79% 40% 40% 83% 85% 84% 86% 20% 20% 0% 0% FY 2018 FY 2019 Q4 2018 Q4 2019 FY 2018 FY 2019 Q4 201
Slide 14: Stable growth in Denmark
Stable growth in Denmark DENMARK Adjusted EBITA, SEKm and % Net Sales, SEKm Key comments +6% -5 6% net sales growth pp 3% organic growth in line with expectations 100 Currency effect added 3% 80 50 Decline in adjusted EBITA margin due to active 60 40 investments to prepare our new market offensive i
Slide 15: Continued strong performance in Sweden
Continued strong performance in Sweden SWEDEN Net Sales, SEKm Adjusted EBITA, SEKm and margin, % Key comments +5% +5% 5% net sales growth 100 45% 43% Continued steady growth in online 50 35% 80 34% Offline sales declined both due to long-term trend 40 29% 29% and a one-off trade in Q4 2018 60 26% 30
Slide 16: Robust cash conversion in Q4
Robust cash conversion in Q4 GROUP Adj. operating cash flow, SEKm and cash conversion, % 219% 200 177% Key comments 168% 156% Adjusted operating cash flow FY 2019 of over SEK 150 250 million, enabling dividend proposal Cash conversion rate 89 % for FY 100 Leverage at 2.7 below financial target 37% 5
Slide 17: Dividend proposal
Dividend proposal Board proposes SEK 0.45 per share to be paid on May 12 DIVIDEND Dividend level 300 Key comments 250 Karnov’s objective is to distribute 30–50 per cent of Proposed dividend of SEK 0.45 per share* the purchase price allocation (PPA) adjusted net 200 profit Proposed dividend correspon
Slide 18: Summary of 2019
Summary of 2019 1 2 In line with financial targets – Organic growth of 4% JUNO rollout completed, still – Adjusted EBITA margin up 0.2 pp enhancements during 1H 2020 – Leverage below 3x 3 4 Board of Directors proposing Solid base to grow business further dividend Q4 2019 PRESENTATION 18
Slide 19: Q&A
Q&A Better decisions, faster Find what you need, trust what you find and do it quickly. For more information visit www.karnovgroup.com/en/section/investors/ Q4 2019 PRESENTATION 19
Slide 20: Appendix
Appendix Q4 2019 PRESENTATION 20
Slide 21: Karnov – The leading B2B platform
Karnov – The leading B2B platform For legal and tax professionals in Denmark and Sweden PRACTITIONERS PUBLIC CONTENT SOURCES Enabling users to make better decisions, faster – every day Legal Accounting and practitioners audit firms CORPORATE Nordic Small & medium PROPRIETARY CONTENT blue-chips enter
Slide 22: Key ratios per quarter
Key ratios per quarter Q4 2019 PRESENTATION 22
Slide 23: Important information
Important information The following applies to this document, the oral presentation of the information in this document by Karnov or any person on behalf of Karnov, and any question-and-answer session that follows the oral presentation. This presentation may contain forward-looking statements that r