Evoke Plc · LSE:EVOK
Evoke — 888 Holdings — H1 2022 Earnings Presentation
35 slides from Evoke's earnings presentation, Aug 12, 2022
Slide 1: 888 Holdings Plc Interim Results 2022
888 Holdings Plc Interim Results 2022 12 August 2022
Slide 2: Introduction
Introduction Itai Pazner, CEO
Slide 3: Agenda
AGENDA 1 Introduction and highlights 2 Financial review 3 Strategic review 4 Summary 5 Q&A 3
Slide 4: H1 2022 Highlights
H1 2022 HIGHLIGHTS Transformational combination with William Hill, providing platform for long-term growth Financial highlights Strategic and operational highlights Sustainable competitive Reported Value enhancing M&A Market focus advantages ◎ Reported Revenue of ◎ Transformational ◎ Launched on a l
Slide 5: Financial review
Financial review Yariv Dafna, CFO
Slide 6: H1 2022 Financial Highlights – Reported
H1 2022 FINANCIAL HIGHLIGHTS – REPORTED 888 results impacted by more stringent UK safer gambling measures and market closures £ millions H1 2022 H1 2021 YoY ◎ Revenue -13% with the main drivers being: Revenue 332 381 -13% - UK revenue -25%, and in line with the market, driven by increased player pro
Slide 7: H1 2022 Financial Highlights – Pro Forma
H1 2022 FINANCIAL HIGHLIGHTS – PRO FORMA1 Pro forma EBITDA +26% to £142m reflecting retail reopening offsetting UK online decline ◎ 888 pro forma shown opposite excludes bingo following its £ millions H1 2022 H1 2021 YoY LTM H1-22 disposal. Trends in line with reported commentary 888 313 356 -12% 62
Slide 8: Regulated Market Leader
REGULATED MARKET LEADER Enhanced position in attractive regulated end markets 21 Licensed Jurisdictions Denmark UK ◎ UK Ireland Sweden ◎ Gibraltar ◎ Ireland Latvia ◎ Jersey ◎ Germany Germany ◎ Romania Canada ◎ Spain Spain Romania ◎ Italy ◎ Denmark ◎ Malta ◎ Sweden USA ◎ Portugal Portugal B2C / B2B ◎
Slide 9: Diversified Revenue Mix
DIVERSIFIED REVENUE MIX Complementary geographic profiles with diversified and balanced product offering Pro forma1 H1-22 Geographic mix (by revenues1) H1-22 Product mix (by revenues1) 1 Pro forma for the William Hill acquisition and excluding 888’s bingo business, which was sold in July 2022 9
Slide 10: Net Debt
NET DEBT Long-term financing structure in place with competitive interest costs in current market Pro forma incl. ◎ £m Pro forma Long-term financing in place, with flexible structure synergies Gross debt at par value 1,760 1,760 ◎ Blended interest rate of approximately 8% IFRS16 lease liabilities1 1
Slide 11: Outlook
OUTLOOK Stable revenues and synergy progress gives us confidence in our plans and outlook ◎ LTM revenue trend stable with retail reopening offsetting online decline. Online revenue broadly stable since Q4-21 post Netherlands closure ◎ Strong and growing customer activity ◎ Pro forma revenue for 2022
Slide 12: Strategic review
Strategic review Itai Pazner, CEO
Slide 13: Strategic Framework
STRATEGIC FRAMEWORK 888 had a clear strategic framework to deliver long-term, sustainable growth Market focus Sustainable competitive advantages Value enhancing M&A Clear focus on the addressable Invest in core capabilities to reinforce our competitive A structured and systematic growth opportunity
Slide 14: Market Focus
MARKET FOCUS Increased focus as we prioritise resources to invest in the most attractive opportunities Completion of William Hill combination Launched all positions the business as a leader in our products on a core and growth markets. Top-3 positions in locally regulated the UK and Spain, and top-5
Slide 15: 888AFRICA
888AFRICA African joint venture launching into four markets initially ◎ Strategic investment in 888AFRICA joint venture ◎ Operating on third party platform provided by alongside five industry veterans, with options to Sportingtech, localised to African requirements and acquire 100% in future prefere
Slide 16: Sustainable Competitive Advantages
SUSTAINABLE COMPETITIVE ADVANTAGES Investing in building a market leading customer proposition World class brands and marketing ◎ Rollout of Made to Play master brand uniting all products Customer excellence and safety Product and content leadership ◎ Continued rollout of Control Centre ◎ Whole host
Slide 17: Bigger, Stronger, Better Together
888 Dia /MM Bigger, Stronger, Better Together
Slide 18: A Powerful Combination
A POWERFUL COMBINATION Transformational acquisition creating a high-growth global leader with significant scale Complementary Brands products and brands LTM Active 2.7 million 3.0 million > 5.7 million customers1 LTM Revenue1 £623m £1,275m £1,898m LTM Adjusted £384m £95m £205m EBITDA1 including £85m
Slide 19: Integration
INTEGRATION Beginning to execute on detailed integration plan to achieve synergies HIGH LEVEL ROADMAP 2022 2023 2024 2025 Discovery PRODUCT AND and Initial platform Phased platform migrations TECHNOLOGY migrations decisions Renegotiations SUPPLIERS across all functions Optimisation of brand marketin
Slide 20: Executive Team
EXECUTIVE TEAM Outstanding leadership team, combining strengths from across both businesses Itai Pazner Chief Executive Officer Phil Yariv Guy Satty Harinder Mark Vaughan Naama Walker Dafna Cohen Bhens Gill Skinner Lewis Kushnir WH MD UK Chief Chief Chief P&T Chief Risk Chief People Chief Strategy C
Slide 21: Summary
SUMMARY Becoming a global leader and well positioned for long-term sustainable growth ◎ The first half of 2022 was a truly transformational period for the Group ◎ Solid financial results, stable revenue sequentially, confident in outlook ◎ Integration plans being executed to deliver synergies ◎ Stro
Slide 22: Q&A
Itai Pazner, CEO Q&A Yariv Dafna, CFO
Slide 23: Appendix
APPENDIX 888 | Oi /HIL
Slide 24: Strategic Rationale
STRATEGIC RATIONALE Complementary business significantly accelerates progress against our strategy The Acquisition brings together two highly complementary businesses, combines two of the industry’s leading brands, and significantly accelerates progress against our strategy: Pro forma combined £1,89
Slide 25: UK Online Revenue Evolution
UK ONLINE REVENUE EVOLUTION Stable and growing business following safer gambling changes and market rebasing Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 (1%) (21%) (5%) (4%) +3% YoY% Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 ◎ Q1 & Q2 2021 benefitting from lockdown and digital entertainmen
Slide 26: International Online Revenue Evolution
INTERNATIONAL ONLINE REVENUE EVOLUTION Diversified global market portfolio provides relief from several regulatory challenges Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 (7%) (7%) (3%) (3%) +1% YoY% Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 ◎ Q1 & Q2 2021 benefitting from lockdowns and dig
Slide 27: UK Retail Revenue Evolution
UK RETAIL REVENUE EVOLUTION Resilient business that has bounced back quickly from enforced closures each time # 1,535 1,533 1,414 1,414 1,414 1,409 1,408 1,407 1,406 1,387 shops1 ◎ Significant revenue impact in quarters where there were COVID ◎ Stable revenue generation since reopening, with LTM H1-
Slide 28: H1 2022 Pro Forma Results by Segment
H1 2022 PRO FORMA RESULTS BY SEGMENT 888 WH - UK Online WH - International Online WH - Retail Group Unaudited pro forma H1 H1 % H1 H1 % H1 H1 % H1 H1 % H1 H1 % £m 2022 2021 Change 2022 2021 Change 2022 2021 Change 2022 2021 Change 2022 2021 Change Average monthly actives (000s) 576 581 -1% 872 856 +
Slide 29: Quarterly Pro Forma Results by Segment
QUARTERLY PRO FORMA RESULTS BY SEGMENT 888 WH - UK Online WH - International Online WH - Retail Group Unaudited pro forma Q1 Q1 % Q1 Q1 % Q1 Q1 % Q1 Q1 % Q1 Q1 % £m 2022 2021 Change 2022 2021 Change 2022 2021 Change 2022 2021 Change 2022 2021 Change Average monthly actives (000s) 585 607 -4% 851 804
Slide 30: Pro Forma Historical Results – Group
PRO FORMA HISTORICAL RESULTS – GROUP Unaudited pro forma - Group 2020 2021 £m Q1 Q2 Q3 Q4 H1 H2 FY Q1 Q2 Q3 Q4 H1 H2 FY Average monthly actives (000s) 1,492 1,469 1,457 1,579 1,480 1,518 1,499 1,664 1,687 1,509 1,540 1,675 1,525 1,600 Sportsbook stakes 1,651.3 906.3 1,914.0 1,995.1 2,557.6 3,909.2 6
Slide 31: Pro Forma Historical Results – 888
PRO FORMA HISTORICAL RESULTS – 888 Unaudited pro forma - 888 2020 2021 £m Q1 Q2 Q3 Q4 H1 H2 FY Q1 Q2 Q3 Q4 H1 H2 FY Average monthly actives (000s) 579 686 524 545 632 535 584 607 555 524 558 581 541 561 Sportsbook stakes 293.1 197.9 369.3 430.6 491.0 799.9 1,290.9 376.9 313.4 270.4 300.9 690.3 571.3
Slide 32: Pro Forma Historical Results – WH UK Online
PRO FORMA HISTORICAL RESULTS – WH UK ONLINE Unaudited pro forma - WH UK Online 2020 2021 £m Q1 Q2 Q3 Q4 H1 H2 FY Q1 Q2 Q3 Q4 H1 H2 FY Average monthly actives (000s) 660 566 681 769 613 725 669 804 909 779 775 856 777 817 Sportsbook stakes 674.3 483.2 807.7 965.8 1,157.5 1,773.5 2,931.0 1,034.4 990.3
Slide 33: Pro Forma Historical Results – WH Int Online
PRO FORMA HISTORICAL RESULTS – WH INT ONLINE Unaudited pro forma - WH INT Online 2020 2021 £m Q1 Q2 Q3 Q4 H1 H2 FY Q1 Q2 Q3 Q4 H1 H2 FY Average monthly actives (000s) 254 217 252 266 235 259 247 253 222 206 207 238 207 222 Sportsbook stakes 289.7 187.3 346.2 353.6 477.0 699.8 1,176.7 332.4 283.1 220
Slide 34: Pro Forma Historical Results – WH Retail
PRO FORMA HISTORICAL RESULTS – WH RETAIL Unaudited pro forma - WH Retail 2020 2021 £m Q1 Q2 Q3 Q4 H1 H2 FY Q1 Q2 Q3 Q4 H1 H2 FY Sportsbook stakes 394.2 38.0 390.9 245.1 432.2 636.0 1,068.2 6.6 267.4 400.1 405.1 274.0 805.2 1,079.2 Sportsbook net revenue margin 20.2% 20.8% 18.2% 22.0% 20.2% 19.7% 19.
Slide 35: Disclaimer
DISCLAIMER Forward looking statements ◎ This presentation may contain certain forward-looking statements, beliefs or opinions, with respect to the financial condition, results of operations and business of the Company. These statements, which contain the words “anticipate”, “believe”, “intend”, “est