Slide 1: Management Presentation First Quarter 2017 Results
April 27, 2017 Management Presentation First Quarter 2017 Results
Slide 2: Forward Looking Statements & Other Information
1 FORWARD LOOKING STATEMENTS & OTHER INFORMATION This presentation, including our “ 2017 Financial Outlook”, contains forward - looking statements . The Company’s representatives may also make forward - looking statements orally from time to time . Statements in this presentation that are not histor
Slide 3: First Quarter 2017 Summary
2 FIRST QUARTER 2017 SUMMARY » Solid start to fiscal 2017 » Return to industry - leading organic revenue growth, consisting of very strong growth in U.S. and broad strength across disciplines and client industry verticals » Strong profit trends, with more meaningful pick - up expected in coming quar
Slide 4: First Quarter 2017 Financial Highlights
3 » Revenue increased 11.5% to $344.7 million from $309.0 million » Organic revenue growth of 5.6%, after a 50 basis points benefit from increased billable pass - through costs » Net loss attributable to MDC Partners common shareholders of ($11.1) million versus a loss of ($23.3) million last year »
Slide 5: Consolidated Revenue and Earnings
4 CONSOLIDATED REVENUE AND EARNINGS Note: Actuals may not foot due to rounding (US$ in millions, except percentages) 2017 2016 Revenue 344.7$ 309.0$ 11.5 % Operating Expenses Cost of services sold 237.6 211.4 12.4 % Office and general expenses 87.8 77.8 12.9 % Depreciation and amortization 10.9 11.2
Slide 6: Revenue Summary
5 » Organic revenue growth of 5.6% in Q1, favorably impacted by 50 basis points from increased billable pass - through costs incurred on clients’ behalf REVENUE SUMMARY 1 Non - GAAP Acquisitions (Dispositions), net consists of $21.1 million of Acquisitions and $0.7 million of Dispositions for the th
Slide 7: Revenue by Geography and Segment
6 REVENUE BY GEOGRAPHY AND SEGMENT » Organic revenue growth led by the U.S. at +8.9% » International impacted by timing of projects and previously - disclosed client loss The Reportable Segment is comprised of our integrated advertising and media specialist agencies as well as public relations f irm
Slide 8: Revenue by Client Industry
7 Year - over - Year Growth by Category » Best performing sectors: Communications, Food & Beverage, Automotive » Diversification continues: Top 10 clients declined to 22.0% of revenue in Q1 2017 versus 23.0% a year ago (largest <5%) REVENUE BY CLIENT INDUSTRY Q1 2017 Above 10% Communications, Food &
Slide 9: Adjusted EBITDA
8 » Benefits of profitability initiatives expected to become more evident over coming quarters ADJUSTED EBITDA 1 Adjusted EBITDA is a non - GAAP measure. See appendix for the definition. See schedules 2 and 3 the Q1 2017 press release for a re conciliation of Net loss to Adjusted EBITDA. Note: Actua
Slide 10: Summary of Cash Flow
9 SUMMARY OF CASH FLOW Note: Actuals may not foot due to rounding (US$ in millions) 2017 2016 Net cash used in operating activities ($30.7) ($122.4) Net cash used in investing activities ($11.1) ($8.1) Net cash provided by financing activities $37.1 $92.4 Effect of exchange rate changes on cash and
Slide 11: Financial Outlook
10 FINANCIAL OUTLOOK Organic Revenue Adjusted EBITDA Margin approximately 4% growth approximately 100 basis points increase 2017 Guidance Note: The Company has excluded a quantitative reconciliation with respect to the Company’s 2017 guidance under the “unreasona ble efforts” exception in item 10(e)
Slide 12: Appendix
11 APPENDIX
Slide 13: Revenue Trending Schedule
12 REVENUE TRENDING SCHEDULE Note: See appendix for definitions of non - GAAP measures Note: Actuals may not foot due to rounding (US$ in thousands, except percentages) Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Revenue United States $252,018 $271,375 $270,512 $291,147 $1,085,051 $252,199 $272,992 $274,506 $3
Slide 14: Adjusted EBITDA Trending Schedule
13 ADJUSTED EBITDA TRENDING SCHEDULE (US$ in thousands, except percentages) Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 ADVERTISING AND COMMUNICATIONS GROUP Revenue $302,222 $336,606 $328,415 $359,013 $1,326,256 $309,042 $337,047 $349,254 $390,442 $1,385,785 $344,700 Operating profit (loss) 26,013 54,372 43,41
Slide 15: Adjusted EBITDA Trending Schedule (cont.)
14 ADJUSTED EBITDA TRENDING SCHEDULE (cont.) 1 Adjusted EBITDA is a non - GAAP measure. See appendix for the definition. See schedules 2 and 3 the Q1 2017 press release for a re conciliation of Net loss to Adjusted EBITDA. Note: Results for 2016 have been restated to reflect the reclassification of
Slide 16: Acquisition Revenue Detail
15 ACQUISITION REVENUE DETAIL 1 For the three months ended March 31, 2017, revenue from acquisitions was comprised of $18.6 million from 2016 acquisitions. 2 Contributions to organic revenue growth (decline) represents the change in revenue, measured on a constant currency basis, re lat ive to the c
Slide 17: Reconciliations
16 RECONCILIATIONS Note: Actuals may not foot due to rounding (US$ in millions) Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Other items, net SEC investigation and class action litigation expenses 5,762$ 3,882$ 2,722$ 1,340$ 13,706$ 1,486$ 1,359$ 767$ 454$ 4,066$ 339$ SEC final settlement payment - - - - - - -
Slide 18: Available Liquidity
17 AVAILABLE LIQUIDITY 1 1 Subject to available borrowings under the Credit Facility. Note: Actuals may not foot due to rounding (US$ in millions) March 31, 2017 December 31, 2016 Commitment Under Facility $325.0 $325.0 Drawn 4.9 54.4 Undrawn Letters of Credit 4.8 4.4 Undrawn Commitments Under Facil
Slide 19: Current Credit Picture
18 CURRENT CREDIT PICTURE 1 These ratios and measures are not based on generally accepted accounting principles and are not presented as alternatives mea sur es of operating performance or liquidity. Some of these ratios and measures include, among other things, proforma adjustments for acquisitions
Slide 20: Temporal Put Obligations and Impact on EBITDA
19 TEMPORAL PUT OBLIGATIONS AND IMPACT ON EBITDA 1 This amount is in addition to ( i ) $44.1 million of options to purchase only exercisable upon termination not within the control of the Company, or death, and (i i) the excess of the initial redemption value recorded in Redeemable Noncontrolling In
Slide 21: Definition of Non-GAAP Measures
20 DEFINITION OF NON - GAAP MEASURES In addition to its reported results, MDC Partners has included in its earnings release and supplemental management presentati on certain financial results that the Securities and Exchange Commission defines as "non - GAAP financial measures." Management believes
Slide 22: MDC Partners contact details
MDC Partners Innovation Center 745 Fifth Avenue, Floor 19 New York, NY 10151 646 - 429 - 1800 www.mdc - partners.com