Slide 1: Q2 2022 Investor Presentation
Q2 2022 Investor Presentation 21 July 2022 Erik Fröberg, Chairman of the Board Johan Hedberg, Interim CEO Roshan Saldanha, CFO Thomas Heath, Chief Strategy Officer & Head of Investor Relations
Slide 2: Erik Fröberg and Johan Hedberg
Erik Fröberg Johan Hedberg Chairman of the Board Interim CEO 2
Slide 3: Q2 2022 Investor Presentation
Q2 2022 Investor Presentation 21 July 2022 Erik Fröberg, Chairman of the Board Johan Hedberg, Interim CEO Roshan Saldanha, CFO Thomas Heath, Chief Strategy Officer & Head of Investor Relations
Slide 4: A global leader in cloud communications and mobile customer engagement
SEK 22.3bn SEK 20bn SEK 2.0bn 4,399 64 countries with net sales in the Market Cap Adj. EBITDA in the people local presence past 12 months past 12 months a global leader in cloud communications Over 150,000 Listed on NASDAQ in Stockholm, Sweden and mobile customer engagement customers Scalable cloud
Slide 5: Adjusted EBITDA per share
Adjusted EBITDA per share Adjusted EBITDA per share, rolling 12 months • Financial target to grow Adjusted 3.00 EBITDA per share > 20% per year, measured on R12M basis 2.50 • Strategy to combine organic and acquired growth 2.00 • Metric is affected by timing of share 1.50 issues and consolidation of
Slide 6: Second quarter highlights
Second quarter highlights 01 02 03 Strong cash flow Stability and growth in Cost reduction program Voice, Email and SMB for Messaging • Net sales growing 80%, Gross profit 123% and Adj EBITDA 77% • 46% gross margin and 21% • Lower growth in gross profit and • SEK 162m reassessment of Adj EBITDA marg
Slide 7: Gross profit evolution
Gross profit evolution Gross profit, SEKm • SEK 162m reassessment of reserves for accrued traffic costs 2,500 Organic incl. changed Acquisitions FX reserve -25% +138% +10% affects Q2 2022 SEKm 2,000 83 1,937 • Organic gross profit growth of -4% 260 13 (excl. reassessment) and proforma 277 organic gr
Slide 8: Opex development
Opex development Adjusted Opex, SEKm 1,800 • Significant year-on-year increased 1,600 in organic opex 1,434 1,400 1,336 • Increase since Q1 22 is 7%, of 1,200 643 which half is due to currency 1,000 583 877 • Largest part of opex relates to 800 205 personnel and is stable vs Q1 586 597 600 400 • Cos
Slide 9: New operating model
New operating model Segment Messaging Voice Email SMB Enterprise & Developer & Business Unit Applications Voice SMB Messaging Email President President President President President Anders Olin Eduardo Henrique Ed O’Hara Will Conway Paul Perrett • 43% of proforma GP* • 32% of proforma GP • 12% of pr
Slide 10: Financials
Financials CAD sinch
Slide 11: Income statement
Income statement Q2 Q2 SEKm 2022 2021 2021 R12M • SEK 162m reassessment of Net sales 6,615 3,682 16,177 22,310 Cost of goods sold and services -4,678 -2,813 -12,244 -16,033 reserves for accrued traffic costs Gross profit 1,937 869 3,933 6,276 affects Gross profit, EBITDA and Adjusted EBITDA Other op
Slide 12: Reconciling Cash flow with Adjusted EBITDA
Reconciling Cash flow with Adjusted EBITDA Q2 Q2 SEK million 2022 2021 2021 R12M • Cash flow before changes in Adjusted EBITDA 503 284 1,322 2,034 working capital is affected by Paid interest -60 -13 -34 -118 Paid taxes -187 -57 -253 -442 realized currency effects on Other items -167 8 152 -77 finan
Slide 13: Cash flow
Cash flow Q2 Q2 SEKm 2022 2021 2021 R12M Cash flow before changes in working capital 89 221 1,188 1,396 • Improved working capital Change in working capital 579 -461 -859 -606 • R12M change in working capital Cash flow from operating activities 668 -240 329 790 affected by ca SEK 500m addition Net i
Slide 14: Revenue recognition
Revenue recognition Balance sheet item Right to payment Recorded as When invoiced Balance sheet as of revenues 30 June 2022 (SEKm) Unbilled Accounts Unconditional When performance Typically days 1,835m Receivables obligation is completed after period end Billed Accounts Unconditional When performanc
Slide 15: Total current assets
Total current assets 31 Dec 31 Mar 30 Jun SEKm 2021 2022 2022 Accounts receivable 3,870 4,197 4,523 of which Unbilled receivables 1,606 1,493 1,835 of which Billed receivables 2,400 2,845 2,858 of which Expected credit losses -136 -142 -169 Tax assets 198 182 210 Other current receivables 298 315 33
Slide 16: Days outstanding
Days outstanding Days Sales Outstanding Days Payable Outstanding • Must relate balance sheet items to proforma L12M • Limited change to DSO in last year and quarter revenues to correctly calculate DSO and DPO DSO = Days Sales Outstanding = (Accounts Receivable + Unbilled Receivables + Accrued income
Slide 17: A global leader in cloud communications
A global leader in cloud communications Rising gross profit and broadened product mix 7,743 11% SMB 11% Email 3,933 32% Voice 2,183 Messaging incl. 46% Applications 2020 2021 2021 proforma Gross profit in SEKm. 17
Slide 18: Financial targets
Financial targets Adjusted EBITDA per share, rolling 12 months Targets: 3.00 • Adjusted EBITDA per share to grow 20% per year 2.50 • Net debt < 3.5x adjusted EBITDA over time 2.00 1.50 Performance: 1.00 • Adjusted EBITDA per share grew 49% in Q2 22, measured on a 0.50 rolling 12 month basis • Profor
Slide 19: Thank you!
Thank you! To get in touch, contact: Ola Elmeland, Investor Relations Director investors@sinch.com