S4 Capital Plc · LSE:SFOR
S4 Capital — H1 2019 Earnings Presentation
41 slides from S4 Capital's earnings presentation, September 2019
Slide 1: Results for the six months ended 30 June 2019
Slide 2: Agenda
1_ Results 2_ Client momentum 3_ People 4_ Mergers, asset purchase and expansion 5_ Integration 6_ Summary and outlook 7_ Appendix 2
Slide 3: HY 2019 Highlights
1. Results Pro Forma Constant currency* HY 2019 Highlights (£m) Billings of 184.23, +38.7% Revenue 87.97, +38.0% Revenue grew 24.2 of which merger and asset purchase contributed 0.6 Gross profit 70.19, +39.9% Gross profit growth 20.0 of which merger and asset purchase contributed 0.5 Accelerating gr
Slide 4: Results for 6 months ended 30 June 2019
1. Results For 6 months ended 30 June 2019 ₤ ₤ ₤ ₤ 4
Slide 5: Results for 6 months ended 30 June 2019
1. Results For 6 months ended 30 June 2019 ₤ ₤ ₤ ₤ 5
Slide 6: Results for 6 months ended 30 June 2019
1. Results For 6 months ended 30 June 2019 ₤ ₤ ₤ ₤ 6
Slide 7: Results as at 30 June 2019
1. Results As at 30 June 2019 ₤ ₤ 7
Slide 8: Results for 6 months ended 30 June 2019
1. Results For 6 months ended 30 June 2019 ₤ ₤ 8
Slide 9: HY 2019 Highlights by practice
1. Results Pro Forma Constant currency HY 2019 Highlights (£m) Content practice revenues (72% of total) 62.97, +28.7% Programmatic practice revenues (28% of total) 25.00, +68.6% Content practice gross profit (64% of total) 45.22, +27.6% Programmatic practice gross profit (36% of total) 24.97, +69.7%
Slide 10: Results by region
1. Results Americas (68% of total) 47.41, +36.8% EMEA (24% of total) 16.80, +28.1% Asia Pacific (8% of total ) 5.98, +149.1% 10
Slide 11: Client momentum
2. Client momentum Client roster continues to strengthen in technology, as well as fast moving consumer goods (FMCG), telecommunications and pharmaceuticals, both by practice and integration. Highlights include wins at Procter & Gamble, Nestlé, Coca-Cola, Sprint and Bayer, with expansion at Google,
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Slide 13: L'Oréal
P&G AT&T BATMAN Marriott Google L’Oréal Award winning Voice and many more Film & innovation Experiential Programmatic In 1.7 sec 13
Slide 14: Gillette Skinguard case study
The Gillette Skinguard is the FROM INSIGHTS TO A BIG IDEA newest razor that uses Brand truth technology to prevent skin Gillette is not perceived as an innovation brand. irritation and cuts when Instead it’s perceived as an expensive brand by a shaving. Unfortunately, not new generation. More than a
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Slide 16: Starbucks Google Action
Google came to us with an APPROACH order we were excited to fill: Working hand in hand with Google, we led the take Starbucks’ existing development and created custom features that Google Action to update the allow caffeine-craving customers to place orders service with various new at their nearest
Slide 17: L'Oréal Paris Unbelieva'brow
L'Oréal Paris empowers APPROACH women by providing them with Adapt the traditional global Unbelieva’brow tools to help them look and campaign to thumb stopping content on feel their best, and giving them Facebook that resonates to the Italian market. access to high performance products that support
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Slide 20: Programmatic buying continues to move in-house
Programmatic buying continues to move in-house, creative strategy and production the next priorities Functions marketing executives anticipate bringing in-house in 2019 Programmatic ad buying (display, video) 37% Creative strategy 35% Production of marketing assets (eg 34% Programmatic buyers have b
Slide 21: Renault
Renault, the lead French APPROACH automobile brand available in Over a 6 month engagement, MightyHive worked 134 countries and sold in over with the Renault teams in France and the Nordics 12,000 dealerships, sold over to bring Renault’s media and web analytics data 2.5m vehicles in 2018. under a un
Slide 22: Mondelēz International
Mondelēz International, APPROACH a global confectionery, food, MightyHive worked with Mondelez to create a and beverage company has cloud-based Global Media Data Warehouse for a portfolio of beloved brands digital measurement. such as Oreo, Milka, Halls, This foundation not only created a single sou
Slide 23: iFood
iFood, Brazil’s leading food APPROACH delivery platform, services Privacy 12 million active users, MightyHive negotiated always-on deals with 120,000 couriers, and exchanges with inventory tied to device IDs 80,000 restaurants. instead of cookies, enabling ongoing audience reach across display, audi
Slide 24: People
3. People Scott Spirit, Chief Growth Officer and Executive Director 15 years at WPP in London, Shanghai and Singapore Oversaw a period of rapid growth and acquisitions Ultimately Global Chief Strategy and Digital Officer Held responsibility for digital, including technology company relationships Boa
Slide 25: People
3. People MediaMonks Tobias Wilson, VP of Growth APAC. Former CEO APD Singapore Sanne Drogtrop, Executive Producer, APAC. Former W+K and 72andSunny Head of Production Eric Alonso, Business Director APAC. Former Digital Director GTB Vivian Opsteeg, General Manager Film & Content. Founder Girls in Fil
Slide 26: People and countries
3. People 1,500+ Content New offices people Programmatic New offices 22 countries 24
Slide 27: Mergers, asset purchases and expansions
4. Mergers, asset purchases and expansions Total Headcount: 1223 Total Headcount: 330 Additional offices: Additional offices: Amsterdam (creative, film and content studio) Paris Mumbai Milan Melbourne Jakarta Los Angeles (production hub) Melbourne New offices but legal entity not yet created Mumbai
Slide 28: Mergers, asset purchases and expansions
4. Mergers, asset purchases and expansions 9th July 2018 24th December 2018 26th April 2019 26th April 2019 21st June 2019* 9th August 2019 Offices Studio, Equipment, 11 8 Directors Roster, Robots, 1 5 2 Portfolio People 750 200 7 27 90 85 *To be finalised in Q3 26
Slide 29: Mergers, asset purchases and expansions
4. Mergers, asset purchases and expansions Geographic Expansion New Capabilities Additional Scale Expanding the global presence of Expanding the capabilities of S4Capital in M&A targets that would add immediate S4Capital to new key markets will deepen areas such as Data & Analytics, scale to the exi
Slide 30: Integration
5. Integration Shared new business: 6 active joint engagements in pharmaceuticals, beauty and retail 14 active joint pitches and client inbounds in entertainment, food & beverage and technology Office Integration Stockholm office – MediaMonks and MightyHive people now co-located Singapore office – M
Slide 31: Summary and outlook
6. Summary and outlook Very strong top line momentum Powerful start to the second half in July Significant human capital investment for development Considerable improvement in EBITDA margin expected in second half Key account developments in both technology and established clients Merger pipeline ro
Slide 32: Appendix
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Slide 34: Advertising and marketing industry
The global advertising and marketing industry was worth $1.7tn in 2018 (including $400bn trade budgets – Redburn). Global internet users = 3.6bn people, or over 50% of the population, in 2018 (Kleiner Perkins). Digital media use 5.9 hours per day (Kleiner Perkins). Half of all advertising spend will
Slide 35: Industry charts
Source: Company estimates Source: Kleiner Perkins Source: Kleiner Perkins Source: Kleiner Perkins 33
Slide 36: Industry charts
Source: Kleiner Perkins Source: Kleiner Perkins Source: Kleiner Perkins Source: Kleiner Perkins 34
Slide 37: Industry charts
Source: Kleiner Perkins Source: Kleiner Perkins Source: Polar State of Digital Media, Q1 2019 Source: Redburn 35
Slide 38: Industry themes
First party data Seven Digital creative Traditional creative Programmatic Sisters Zero-based budgeting In-housing Custom research Post-Lehman slower GDP Consultancy growth Walled gardens ‘growing’ ‘Take Back Control' 36
Slide 39: Our four core principles
Our four core principles Holy Trinity of: Virst-party data Digital content Programmatic Weare purely digital Witha unitary structure Paster Better Cheaper 37
Slide 40: Company history
Formation and initial funding of S4Capital plc in May 2018. Combination with the leading digital content Advertising Age A-Listed production company MediaMonks in July 2018. Injection of the enlarged Company into the quoted ‘shell’ company, Derriston Capital Plc, with admission to the Standard List
Slide 41: Analyse, create and develop, plan and deliver
1.Analyse Utilise clients’ and platform First-party data data and grow by business Assist in the sourcing, analysis and delivery of aggregated and high quality relevant datasets. combinations Fuel marketing budget ROIs by filtering noise through proprietary tools and frameworks. Focus on data analyt