Slide 1: Management Presentation First Quarter 2016 Results
May 3, 2016 Management Presentation First Quarter 2016 Results
Slide 2: Forward Looking Statements & Other Information
2 FORWARD LOOKING STATEMENTS & OTHER INFORMATION This presentation, including our “ 2016 Financial Outlook”, contains forward - looking statements . The Company’s representatives may also make forward - looking statements orally from time to time . Statements in this presentation that are not histor
Slide 3: First Quarter 2016 Summary
3 FIRST QUARTER 2016 SUMMARY » Positive but uneven organic growth due to timing of revenue recognition, continued decline in billable pass - through costs, and shifts in spend by some clients » Good start to the year for profitability: Q1 Adjusted EBITDA margins +30 basis points; on target to achiev
Slide 4: First Quarter 2016 Financial Highlights
4 » Organic revenue growth of 2.2%, after a 241 basis points reduction from significantly lower billable pass - through costs » Revenue increased 2.3% to $309.0 million from $302.2 million » Net loss attributable to MDC Partners improved to ($23.3) million vs ($32.1) million despite the costs relate
Slide 5: Consolidated Revenue and Earnings
5 CONSOLIDATED REVENUE AND EARNINGS (US$ in millions, except percentages) 2016 2015 Revenue 309.0$ 302.2$ 2.3 % Operating Expenses Cost of services sold 211.4 210.4 0.5 % Office and general expenses 77.8 74.3 4.7 % Depreciation and amortization 11.2 12.3 (8.8) % Operating Profit 8.5 5.2 64.5 % Other
Slide 6: Revenue Summary
6 » Organic growth of +2.2%, negatively impacted by 241 basis points from a roughly $6 million decline in billable pass - through costs REVENUE SUMMARY (US$ in millions, except percentages) Revenue $ % Change March 31, 2015 $302.2 Foreign Exchange Impact (3.6) -1.2% Acquisition Growth 3.8 1.3% Organ
Slide 7: Revenue by Geography
7 REVENUE BY GEOGRAPHY » U.S. declined due to decreased billable pass - through costs in our Experiential business, timing of revenue recognition, and shifts in spend by some clients » Renewed growth in Canada and continued strong performance in International (US$ in millions, except percentages) %
Slide 8: Revenue by Client Industry
8 Q1 2016 Mix Year - over - Year Growth by Category » Fastest growing client sectors: Technology, Automotive, Food & Beverage » Diversification continues: Top 10 clients declined to 23.0% of revenue in Q1 2016 from 24.4% a year ago (largest <4%) REVENUE BY CLIENT INDUSTRY Q1 2016 Above 10% Technolog
Slide 9: Organic Growth vs. Peers
9 ORGANIC GROWTH 1 Peers include Omnicom, IPG, WPP, Havas and Publicis . MDC Partners vs. Peers 1 Trailing 12 Month Organic Revenue
Slide 10: Adjusted EBITDA
10 » Adjusted EBITDA growth and margin expansion aided by leverage of corporate » Segment profitability impacted by timing issues, and is expected to contribute to growth as we move through the year and especially in the second half ADJUSTED EBITDA 1 Adjusted EBITDA is a non GAAP measure. See schedu
Slide 11: Adjusted EBITDA Available for General Capital Purposes
11 ADJUSTED EBITDA AVAILABLE FOR GENERAL CAPITAL PURPOSES 1 Adjusted EBITDA is a non GAAP measure. See schedules 2 and 3 of the Q1 2016 press release for a reconciliation of Net loss t o A djusted EBITDA. 2 Capital Expenditures, net represents capital expenditures net of landlord reimbursements. 3 C
Slide 12: Available Liquidity
12 AVAILABLE LIQUIDITY 1 1 Subject to available borrowings under the Credit Facility . (US$ in millions) March 31, 2016 December 31, 2015 Commitment Under Facility $325.0 $325.0 Drawn 17.0 0.0 Undrawn Letters of Credit 4.6 5.0 Undrawn Commitments Under Facility $303.4 $320.0 Total Cash & Cash Equiva
Slide 13: 2016 Financial Outlook
13 2016 FINANCIAL OUTLOOK Revenue Adjusted EBITDA Adjusted EBITDA Available for General Capital Purposes Implied Adjusted EBITDA Margin $1.326 billion $197.7 million $113.4 million 14.9% $1.410 to $1.440 billion $225 to $235 million $130 to $140 million 15.8% to 16.4% +6.3% to +8.6% +13.8% to +18.9%
Slide 14: Appendix
14 APPENDIX
Slide 15: Temporal Put Obligations and Impact on EBITDA
15 TEMPORAL PUT OBLIGATIONS AND IMPACT ON EBITDA 1 This amount is in addition to $50.8 million of ( i ) options to purchase only exercisable upon termination not within the control of the Company, or death, and (ii) the excess of the initial redemption value recorded in Redeemable Noncontrolling Int
Slide 16: Summary of Cash Flow
16 Note: Actuals may not foot due to rounding SUMMARY OF CASH FLOW Note: Actuals may not foot due to rounding (US$ in millions) 2016 2015 Cash flows use in continuing operating activities ($128.7) ($112.4) Discontinued operations 0.0 (1.3) Net cash used in operating activities ($128.7) ($113.7) Cash
Slide 17: Revenue Trending Schedule
17 Note: Actuals may not foot due to rounding REVENUE TRENDING SCHEDULE (US$ in thousands, except percentages) 2016 Q1-14 Q2-14 Q3-14 Q4-14 FY 2014 Q1-15 Q2-15 Q3-15 Q4-15 FY 2015 Q1-16 Revenue United States $228,833 $243,128 $249,128 $272,385 $993,474 $252,018 $271,375 $270,512 $291,146 $1,085,051
Slide 18: Organic Growth Methodology
18 ORGANIC GROWTH METHODOLOGY Year over Year Change in GAAP Revenue Less: Impact of Foreign Currency Less: Impact of Acquisitions* __________________________ = Organic Growth * Includes revenue prior to MDC’s ownership of acquisitions completed in the current year in addition to revenue from acquisi
Slide 19: Acquisition Revenue Disclosures
19 ACQUISITION REVENUE DISCLOSURES 2015 10K, MD&A Section, page 20: 2015 10K, Acquisition Footnote 4, page 59: Represents revenue recognized in MDC’s consolidated financial results for the period of ownership contributed by businesses acquired in the current year Represents the incremental impact on
Slide 20: Definition of Non-GAAP Measures
20 DEFINITION OF NON - GAAP MEASURES Adjusted EBITDA: Adjusted EBITDA is a non - GAAP measure, that represents operating profit plus depreciation and amortization, stock - based compensation, acquisition deal costs, deferred acquisition consideration adjustments, distributions from non - consolidate
Slide 21: MDC Partners contact details
MDC Partners Innovation Center 745 Fifth Avenue, Floor 19 New York, NY 10151 646 - 429 - 1800 www.mdc - partners.com