Slide 1: Financial Results
Financial Results Twelve months ended 31 March 2017 system1group.com
Slide 2: Leading exponent of behavioural economics and system 1 thinking in marketing and research
Leading Founded in 1999 exponent of behavioural Floated on AIM in December 2006 at £1.08 per share economics and Track record of profitable organic growth and strong cash flow system 1 thinking in marketing and Operating in 10 countries research 150 + employees 200 + large (mainly consumer goods) cl
Slide 3: Top-line returned to growth after two slower years
Gross profit (£m) main top-line performance indicator 30 25 Revenue up 27% (13% in constant currency) Top-line returned 20 Gross profit up 29% (15% in constant currency) 15 to growth after 10 Operating profit up 25% two slower years 5 Profit before tax up 25% 0 2009 2010 2011 2012 2013 2014 15/16 16
Slide 4: Growth driven by core products, particularly Ad Testing and Brand Tracking
Product mix – gross profit £m Ad Testing & Brand Tracking Growth driven by Predictive Markets Most of the business from our core 4 products Building brands and comms: Ad Testing, Brand Tracking core products, Concept Testing Innovation: Predictive Markets, Concept Testing particularly Ad Other Build
Slide 5: US growing well, and Continental Europe bounced back. UK down a little
US growing well, and Continental Europe bounced back. UK down a little – market highly competitive Gross profit Operating profit US £11.64m + 48% £6.84m + 56% Gross profit split UK £6.39m - 5% £3.93m - 11% Australia Continental Europe £5.26m + 56% £3.16m + 63% Asia Brazil Asia £1.40m - 21% £0.64m -
Slide 6: Cost increase in large part due to increase in bonus accrual
2016/17 2015/16 Growth Cost increase in Underlying overheads £17.04m £15.30m 11% Modest underlying cost increase Cost growth pre-bonus below large part due to gross profit growth increase in bonus Bonus £2.22m £0.09m accrual Capacity to scale several times System1 Advertising Agency £0.46m £0.09m cu
Slide 7: Strong cash flow and returning it to shareholders
Strong cash flow Cash Flow Returns to shareholders and returning it to shareholders High cash conversion Returned £5.19m Pre-financing cash flow £6.60m to shareholders in the year (164% of profit after tax) Dividends £2.05m Share buy-backs £3.14m Finished the period with £8.27m cash and no debt 2016
Slide 8: Outlook … more of the same
Made good progress 2017/18 objectives Outlook … on 2016/17 objectives are similar more of the same Continue momentum in US ✔ and … Grow in other regions as in US ✔✖ Investing in US and Ad Agency but … Grow gross profit by more than headcount (in % terms) ✔ De-emphasising Zappistore Major on core pro
Slide 9: Financial Results
Financial Results Twelve months ended 31 March 2017 system1group.com