Verve Group Se Class A · OMXSTO:VER
Verve Group Se Class A — Merger or Acquisition (June 2024)
30 slides from Verve Group Se Class A's merger presentation, Jun 18, 2024
Slide 1: Verve Investor Presentation
STRICTLY PRIVATE AND CONFIDENTIAL Verve Investor Presentation Let’s make media better.
Slide 2: Introduction to the Transaction
Introduction to the Transaction Verve has agreed to acquire Jun Group to strengthen its demand side business Background Pro-forma 2024E • Jun Group is a US based digital media company with a 20+ year track record of strong technology development Figures in EURm Verve Jun Synergies Pro-forma • Enable
Slide 3: Key Investment Highlights
Key Investment Highlights 01 | Perfect strategic fit strengthening the demand side of Verve’s leading Mobile-SSP business Transformative acquisition 02 | Demand side technology platform, strong mobile focus, US centric business 03 | Direct access to 230+ customers, including many Fortune 500 brands
Slide 4: I. Intro to Jun Group
I. Intro to Jun Group Vy
Slide 5: Jun Group at a Glance
Jun Group at a Glance Mobile-first digital advertising company, powered by software integrations with leading iOS, Unity and Android applications THE COMPANY Fortune 500 Grade Clients 2005 97% €72m Serving Iconic Brands & Media Companies… …and Leading Agencies Founded US Revenues Net Revenues 2023 +
Slide 6: Jun Group Product Offerings
Jun Group Product Offerings Suite of technology and tools built in-house fuel exceptional solution set Machine learning tool that leverages zero- Artificial intelligence engine that Self-service dashboard enabling clients to party polling data and lookalike modeling to automatically optimizes perfor
Slide 7: Jun Group’s Leading Clients Achieve Outcomes That Are Unmatched Across the Industry
Jun Group’s Leading Clients Achieve Outcomes That Are Unmatched Across YEAR OF CAMPAIGN: 2023 the Industry BUSINESS LINE: Brand IMPRESSIONS: 2.5M+ OUTCOMES SITUATION OVERVIEW Jun Group’s high-impact display placements with embedded • Smithfield wanted to drive purchase add-to-cart functionality stre
Slide 8: Selected Client Metrics
Selected Client Metrics IMPRESSIVE CLIENT DIVERSIFICATION REVENUE BY SPEND TRANCHE (% of revenue from top clients in 2023A) (2023A) 9% 9% No client makes 66% 4% Of revenue from 44% 6% up more than 8% Other clients spending clients ~9% of total 6% greater revenue 9% 5% than $1M 5% 4% 4% 4% 4% 13% 60%
Slide 9: II. The Combined Group
II. The Combined Group 9
Slide 10: Jun Group & Verve
Jun Group & Verve Combination highlights COMBINED PLATFORM Better data, better scale, better reach, tangible AI SIGNIFICANT SIZE1 €151m EBITDA in 2024E with strong deleveraging capacity BETTER BALANCED COMPANY2 30% demand-side, 70% supply-side 10 Notes: (1) On pro-forma basis including annualized sy
Slide 11: Uniqe Growth Opportunities
Uniqe Growth Opportunities CONNECTING INTERNATIONAL- OPEX ORGANIC REVENUE SUPPLY AND IZATION SYNERGIES GROWTH DEMAND • Jun Group will benefit from • Jun Group will profit from • Jun Group will gain from • Jun Group will profit from Verve’s global presence with direct access to Verve‘s access to Verv
Slide 12: III. Synergies and Pro-forma
III. Synergies and Pro-forma 12
Slide 13: Strong Jun Group Free Cash Flow Profile
Strong Jun Group Free Cash Flow Profile Cost effcient set up enabling 50% EBITDA margin, high cash conversion Revenue Adj. EBITDA Capital Expenditures (€ in Millions) (€ in Millions) (€ in Millions) 3 3% 3% 4 3% Synergies 87 3 Synergies 2 9 2 1 2.1 2.4 2.4 1 0 0 2022 2023 2024E 45 CAPEX as % of Reve
Slide 14: Unique Revenue Growth and Synergy Potential
Unique Revenue Growth and Synergy Potential Significant EBITDA uplift due to synergies and incremental revenue potential OPEX Synergies Revenue Synergies Synergies EBITDA Uplift ~€2m ~€9m1 ~€8m Mid-term €30-40m revenue upside estimated Total EBITDA based on network effects Growth from combined deman
Slide 15: Verve & JUN - Combined Financials 2024E
Verve & JUN - Combined Financials 2024E Highly accretive acquisition resulting in €151 million EBITDA Combined Group Financials 2024E1 Comments1 €m • The transforming transaction will + materially increase the size and Revenues Adj. Synergies Adj. EBITDA Margin profitability of Verve Group, adding 4
Slide 16: Verve & JUN – Combined 2023-2025
Verve & JUN – Combined 2023-2025 Transformative acquisition resulting in a 59% increase in Adj. EBITDA YoY Combined Group Financials 2023 to 2025E pro forma Comments1 €m The combined pro forma revenues 2024E + + • corresponds to a growth of 39% YoY to Adj. EUR 447 million Revenues Synergies % Adj. E
Slide 17: IV. Transaction Overview
IV. Transaction Overview 17
Slide 18: Sources & Uses and Net Debt
Sources & Uses and Net Debt Pro-forma net leverage decreases to 2.4x (2.8x including deferred payment) SOURCES & USES AS OF 31.03.2024 (ILLUSTRATIVE) Sources In €m Uses In €m Equity Issue ~40 Cash to Jun Group shareholders 120 Verve Cash & Cash Equivalents ~80 Deferred Consideration 50 Deferred Cons
Slide 19: Transaction Structure
Transaction Structure ● EUR 120 million Closing Consideration represents an EV/EBITDA multiple of 2.6x1 of which EUR ~40 million will be paid from a Purchase price table EURm EV/EBITDA capital increase and EUR ~80 million will be paid from cash at hand2 Closing Consideration Payment 120 2.6x1 ● Incl
Slide 20: Simplified Pro Forma Balance Sheet
Simplified Pro Forma Balance Sheet Balance Sheet as of 31.03.2024 Combined Balance Sheet Comments (€m) Verve Jun Group Financing Combined • Purchase price EUR 170 million financed via: Goodwill & Other Intangibles 815 157 972 Deferred tax assets • EUR ~40 million equity issuance 13 13 Long-term asse
Slide 21: Updated Guidance 2024
Updated Guidance 2024 Strong H1 2024 combined with exceptional M&A opportunity leads to significant Guidance Update Updated Guidance 2024 FY 2023 Guidance 2024 incl. Jun Group as of September 2024 Revenue (in €m) 322 350 – 370 380- 400 Adj. EBITDA (in €m) 95 100 – 110 115 - 125 21 Notes: (1) Assumin
Slide 22: Verve Updates its Mid-Term Financial Targets
Verve Updates its Mid-Term Financial Targets1 Revenue CAGR EBITDA margin EBIT margin Net leverage 25-30% 25-30% 15-20% 2.0-3.0x 30-35% 20-25% 1.5-2.5x 22 Notes: (1) The updated mid-term financial targets are subject to completion of the Jun Group acquisition.
Slide 23: Verve Embarks on Attractive Journey
Verve Embarks on Attractive Journey 01 | At an implied 10% growth rate in 2025, EBITDA will grow to about €170m of which about 80% is cash EBITDA 02 | The much stronger cash EBITDA will materially improve the quality of earnings and the ability to deleverage 03 | Improved leverage metrics expected t
Slide 24: V. Appendix: Verve Group Overview and Q1 Update
V. Appendix Verve Group Overview and Q1 Update 24
Slide 25: Company History
Company History Strong Organic Growth with Economies of Scale 38% CAGR 37%1 60% 336 322 2 3032 50% Organic Growth3 252 40% 21% 18% 29% 30% 29% 30% 28% 140 21% 20% 93 95 98 71 77 77 78 55 29 10% 5% 18 0% 2020A FY 2021 FY 2022 FY 2023 Q1 2024 LTM 2021 2022 2023 Q1 2024 Net sales (€m) Adj. EBIT (€m) Ad
Slide 26: Integrated Ad-Software-Platform
Integrated Ad-Software-Platform 750+ 750+ Software Employees2 Clients1 20% 16% 730B+ 2B+ 5% Yearly ad Connected 1% impressions3 devices Revenue Revenue by Region 14% by Device 66% 1B+ 15+ 78% Registered Locations Gamers worldwide NA RoW Mobile Desktop EU CTV DooH Leading 5,000+ Mobile SSP in O&O Gam
Slide 27: First Quarter Financial Highlights
First Quarter Financial Highlights Strong Organic Growth Highly Profitable and Cash Generating 20% 21% Profit Growth % Revenue Growth Organic Revenue Growth adjusted for FX 16% 10% Adj. EBITDA growth Adj. EBIT growth Net Revenues Adj. EBITDA 99 €m Strong Margin % 82 76 78 20% revenue 69 growth 27% 2
Slide 28: KPIs Driving Organic Revenue and EBITDA Growth
KPIs Driving Organic Revenue and EBITDA Growth Ad impressions delivered Ad Impressions Net $ Expansion Rate 1 (in bn) 110% +20% 93% 95% 206 199 89% 181 186 166 82% Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 Total Software Clients2 +30% >100k $ Software Clients3 Total Software Client
Slide 29: Focus on Further Growing Verve’s Demand-Side
Focus on Further Growing Verve’s Demand-Side Mobile focused Strong demand side tech stack Organic Significant organic growth potential Adding Jun Group’s Growth +230 advertisers Supply path optimization We take up to 5 middlemen out of the supply chain and enable more direct access to content Strong
Slide 30: Let’s make media better.
Let’s make Let’s makemedia media better.better. www.verve.com