XLMedia Plc · OTC:XLMDF
XLMedia — H1 2019 Earnings Presentation
22 slides from XLMedia's earnings presentation, September 2019
Slide 1: Technology-Driven Performance Marketing
TECHNOLOGY-DRIVEN PERFORMANCE MARKETING Sep 2019
Slide 2: Our Business
Our Business o A leading performance marketing and online publishing company o We attract paying users from multiple online channels and direct them to online businesses in return for performance based payment models o Main source of revenue generated from a wide network of publishing assets o Focus
Slide 3: H1 2019 Overview
H1 2019 Overview 3
Slide 4: Key Highlights
Key Highlights o Core focus on higher margin publishing activities o First six months impacted by regulatory headwinds in key Swedish, German, UK and Swiss markets o US gambling market continues to develop positively – recent registration of subsidiary, XLMedia US Limited, by the Pennsylvania Gaming
Slide 5: Current Trading
Current Trading o Despite strong rankings of key assets, regulatory headwinds highlighted above continue to create trading uncertainty for the group. These headwinds affecting trading in Q3. o The combination of these regulatory headwinds and a slowdown in the Group’s acquisition activity this year
Slide 6: Gambling Regulatory Summary
Gambling Regulatory Summary United Kingdom Switzerland • A new gambling regulatory regime came into effect in • Increased compliance demands on operators, including more Switzerland in January 2019. stringent age verification and Know-Your-Customer rules, continue to • Under the new regime, licenses
Slide 7: Financial Results
ss a ig e i 8 33 11046 iV C Ls Financial R
Slide 8: XLMedia in Numbers
XLMedia in Numbers H1-2019 Revenues H1-19 Gross profit H1-19 Adjusted EBITDA $42.5M $28.8M $18.6M H1-19 Net profit Cash Customers $12.15M $43.1M 300+ and short-term investments Tier 1 Publishing assets Staff Operating across 160+ ~370 20+ Employees Countries 8
Slide 9: Revenue Diversification
Revenue Diversification Revenues diversification – Revenues Diversification – Revenues per Users’ Geography Products Business Model North America, 22% CPI, 0% Other Revshare, 71% Gambling, 86% Europe, 14% Scandinavia, United CPA, 29% 44% Kingdom, Personal 14% Finance, 14% Other, 0% Other Territories
Slide 10: Income Statement
Income Statement Item US$‘000 H1.2019 2018 Revenues 42,459 93,502 Cost of revenues 13,621 30,133 Gross profit 28,838 63,369 Operating expenses 14,514 26,684 Operating profit 14,324 36,685 Total adjusted EBITDA* 18,445 43,571 % Adjusted EBITDA 43% 47% Finance expenses, net )529( )537( Profit before t
Slide 11: Cash Flow Statement
Cash Flow Statement US$‘000 H1.2019 2018 H1.2019 2018 Operating Activities Financing Activities Net income 12,151 20,775 Dividend paid to equity holders of the Company (8,226) (14,362) Depreciation, amortisation and impairment 3,618 6,503 Share capital issuance - 42,618 Cost of share-based payment 6
Slide 12: Balance Sheet 30 June 2019
Balance Sheet 30 June 2019 US$‘000 30.6.19 31.12.18 30.6.19 31.12.18 Current liabilities Current assets: Current maturity of long-term bank loan 4,216 5,585 Cash and short term investments 43,078 47,623 Lease liability 1,729 - Trade receivables 9,410 16,112 Trade payables 2,660 6,416 Other accounts
Slide 13: Growth Strategy
Growth Strategy 13
Slide 14: Focus on Publishing Expertise
Focus on Publishing Expertise o Multiple headwinds across key European [regulated] gambling markets o Leverage gambling expertise with focus on broadening the Groups market reach o Accelerate activities in US gambling market – committed to $7M investment programme during 2019-21 o Continue to build
Slide 15: Expand The Personal Finance Sector
Expand The Personal Finance Sector o Personal finance business continues to grow and has increased its presence in the North American markets o 14% of overall revenues now derived from this sector (FY 2018: 6%) o Committed to expanding US operations – adding scale to grow our publishing assets o Act
Slide 16: US Gambling Opportunity
US Gambling Opportunity Our plan for the US gambling market o XLMedia actively investing in building and developing a more comprehensive portfolio of publishing assets as part of the recently announced plan o The group will still be looking for strategic acquisitions in the region but generally focu
Slide 17: Key Growth Initiatives
Key Growth Initiatives North Pursuit of growth opportunities in North America to both build and develop a America comprehensive portfolio of online assets targeting gambling & personal finance Technology Continue developing the Group’s core technology to retain competitive investment advantage Focus
Slide 18: Summary & Outlook
Summary & Outlook o Proactive exit from low margin media activities to focus on higher margin publishing business, management focused on the long term targets o Short-term financial impact but the Board is confident these steps will deliver higher profit margins and a much higher quality of sustaina
Slide 19: Any Questions?
Any Questions? 19
Slide 20: Optimization Cycle
Optimization Cycle Quality content Asset optimisation Place Brands Send users Big Data Gather data Target Proprietary tracking, data and analysis tools Send users XLM self-funded Bid on ads Place Brands campaigns 20
Slide 21: Experienced Senior Leadership
Experienced Senior Leadership MICHAL BADHAV GENERAL COUNSEL LIAT HELLMAN Acting CFO • Over 20 years of global experience in senior executive legal positions at public and • Over 20 years’ experience in private technology companies publicly traded companies • Served as Deputy General Counsel • Serves
Slide 22: Disclaimer
Disclaimer THIS PRESENTATION (THE “PRESENTATION ”) WHICH HAS BEEN PREPARED BY 4. you will not forward, reproduce or otherwise disclose the contents of this XLMEDIA PLC. (THE “COMPANY) IS FOR INFORMATION PURPOSES ONLY AND DOES document to any person in contravention of FSMA or any other applicable NO