Modern Times Group Mtg Ab Class A · OMXSTO:MTG_A
Modern Times Group Mtg Ab Class A — Investor Presentation (2017)
32 slides from Modern Times Group Mtg Ab Class A's investor presentation, 2017
Slide 1: Shaping the future of entertainment
Shaping the future of entertainment
Slide 2: Agenda
Agenda 13.00 Group strategy & financial review Jørgen Madsen Lindemann (President & CEO) & Maria Redin (CFO) 13.50 Nordic Entertainment Anders Jensen (EVP; Chairman of the Nordic Entertainment Management Board & CEO of MTG Sweden) & Jakob Mejlhede Andersen (EVP; Group Head of Programming & Content D
Slide 3: 30 years of transformation
30 years of transformation 1987 2017 Our Consumers, Markets and Products Our Content 43
Slide 4: #WEAREMTG
#WEAREMTG Value-driven Can-do Passionate Responsible +29% attitude professionals organisation eNPS culture 30 years of Love to challenge Acting responsibly MTG is a Bold, Smart, constant & create together & embracing preferred Fun, Engaging innovation diversity workplace 4
Slide 5: A simple story
Managing the Into a leading With long-term And returning transformation digital video sales & profits value to of a traditional entertainment growth shareholders broadcaster provider A simple story 5
Slide 6: Supported by a clear strategy
Supported by a clear strategy Value creation strategy Long term revenue and profit growth Drive performance Drive growth in traditional in digital Innovation #1 online video player Profitability Expansion Consolidation Diversification Strategic transformation Cost transformation Portfolio management
Slide 7: Why change?
Why change? Simply to follow the eyeballs! how when what 7
Slide 8: Video entertainment consumption is rising
• x Video entertainment consumption is rising (hours per week) +11% On-demand viewing Live & scheduled linear viewing Source: Ericsson Consumer & Industry Insight Report, October 2017 8
Slide 9: From a traditional broadcaster into a digital entertainer
From a traditional broadcaster into a digital entertainer Gaming & Esports Digital video 9
Slide 10: Transformation accelerated by active portfolio management
Transformation accelerated by active portfolio management Kongregate Baltics Engage Sports InnoGames Hungary Czech Rep. Media Turtle Acquisitions ESEA Russia Disposals Africa Splay DreamHack Ukraine Zitius Zoomin Sappa 10
Slide 11: Acquisitions made since 2015
Acquisitions made since 2015 Enterprise Revenues Break Even value of SEK of SEK before PPA 5.6 bn 3.4 bn Note: Enterprise value is for 100% ownership (MTG share equals SEK 3.6 bn). Revenues and EBIT are on LTM pro forma basis. EBIT is before PPA amortisations 11
Slide 12: A stronger & more relevant MTG
A stronger & more relevant MTG Digital An integrated With a accounted for broadcast & global digital online media entertainment 34% house arm of Q3 sales 12
Slide 13: We tell relevant stories
We tell relevant stories Hassel Under Hundringen Nobel World Boxing Super Series Forge of Empires Dreamhack ESL One Champions Jönköping New York League 13
Slide 14: An integrated broadcaster
An integrated broadcaster Changed from the ground up Sports Series Movies Kids OP IP Advertising, Subscription & Distribution revenues DTH Cable BTV VOD DTT Mobile 12 14
Slide 15: A portfolio of strong digital brands
A portfolio of strong digital brands Pricing power High quality content Loyalty & Engagement Customer satisfaction 15 15
Slide 16: Never been a bigger opportunity in MTG's history
Never been a bigger opportunity in MTG’s history 1 Huge & growing audiences Secular tailwinds from broadband speeds & mobility 2 Products & brands that our customers love Strong growth in usage of our products 16
Slide 17: Gaming – a secular growth industry
Gaming – a secular growth industry Global Gaming Market (USD bn) Key Growth Drivers 6% CAGR CAGR 129 2016-2020E More players 101 Mobile & Browser PC 69 12% 44 More paying players 3% 32 36 Console 25 24 PC (traditional) 0% Higher spend per player 2016 2020E Source: Newzoo; OC&C Analysis 17
Slide 18: Esports - a huge and growing audience
Esports - a huge and growing audience Sports enthusiasts (M) Esports & Gaming viewing more popular than sports amongst male Americans aged 18-25 191 186 151 147 1. Movies 2. Online gaming and esports 94 76 3. TV shows 4. Sports 5. User generated content 6. News Esports Volleyball American Handball I
Slide 19: Increased usage
Increased usage +40% +44% +27% Viaplay, Viafree, ESL and DreamHack refers to growth in started streams. InnoGames and Kongregate refers to growth in mobile monthly active users (MAU) 19
Slide 20: We continue to invest with a disciplined approach
We continue to invest with a disciplined approach Local hero Digital MTG can Video-centric or Entertainment Add value Universal appeal 20
Slide 21: Significant progress since last CMS
Significant progress since last CMS Organic sales growth Digital sales growth Q416-Q317 (YoY) Q416-Q317 (YoY) 8% 48% 24 21
Slide 22: Significant progress since last CMS
Significant progress since last CMS EBIT growth Record dividend Q416-Q317 (YoY) Paid out in Q217 23% SEK 800m 25 22
Slide 23: Significant progress since last CMS
Significant progress since last CMS Strong and improving Strategic working cashflow generation capital investments 1.3 SEK m SEK bn 0.9 0.7 0.7 355 0.5 0.5 273 225 222 197 0.3 144 161 66 Q4 Q1 Q2 Q3 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 2015/16 2016/17 Viaplay Originals WC Other Working Capital
Slide 24: Significant progress since last CMS
Significant progress since last CMS Acquisitions Divestments Q416-Q317 Q416-Q317 InnoGames Czech Rep. & Baltic’s Kongregate Africa 26 24
Slide 25: Significant progress since last CMS
Significant progress since last CMS Sales split Q3 2016 Sales split Q3 2017 21% 34% 79% 66% Digital revenue Other Digital revenue Other 25
Slide 26: Improved disclosures for MTGx
Improved disclosures for MTGx Revenue breakdown Digital Online Esports Video Gaming Networks EBITDA and EBIT for the segment 26
Slide 27: MTGx – improved disclosures
MTGx – improved disclosures Revenue break-down by type (jan-sep) 1.431 600 EBITDA 245 245 of SEK 6m in Q3 223 855 855 706 9M 2016 9M 2017 9M 2017 Pro forma Gaming DVN esports 29 27
Slide 28: Solid financial profile
Solid financial profile Net Debt development Timeline of key transactions SEK bn Q2 2016 – divestment of CTC Q4 2016 – initial investment in InnoGames Q2 2017 – divestment of Prima (Czech Rep.) Q2 2017 – increase stake in InnoGames Q3 2017 – acquisition of Kongregate Q4 2017 – complete sale of Balti
Slide 29: A focused capital allocation
Remain committed Investing in video to distribute money entertainment to shareholders services A focused capital allocation Disciplined Focus our capital approach to where the opportunities acquisitions are the biggest 29
Slide 30: The strategy is working
The strategy is working 150 MTG B +36% 140 130 120 110 100 Media index +5% 90 80 nov dec jan feb mar apr maj jun jul aug sep okt nov 2016 2016 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 2017 Share price performance in ’MTG B’ and ’STOXX Europe 600 Media’ since 2016 CMS (10 Nov 2016) 32 30
Slide 31: 5 initiatives to drive future returns
5 initiatives to drive future returns 1 Win in the Nordics – unique concept & strong VOD positions 2 Scale up MTGx – capitalise on consumer trend shifts 3 Strategic partnerships 4 Strict cost control & capital allocation 5 Active portfolio management 31
Slide 32: Time is on our side!
Time is on our side! We have With strong Now all great market about scaling products positions them 34 32
Modern Times Group MTG — Investor Presentation (2017) on 6ix