Stagwell Inc. · NASDAQ:STGW
Stagwell — MDC Partners — Q1 2011 Earnings Presentation
18 slides from Stagwell's earnings presentation, Apr 28, 2011
Slide 1: Management Presentation: First Quarter 2011 Results
0) Management Presentation April 29, 2011 First Quarter 2011 Results MDC(K)PARTNERS
Slide 2: Forward Looking Statements and Other Information
MDC(K)PARTNERS Forward Looking Statements and Other Information ‘This presentation, including our “2011 Financial Outlook”, contains forward-looking statements. The Company's representatives may also make forward- Tooking statements orally ftom time to time, Statements in this presentation that are
Slide 3: Key Highlights
MDC(K)PARTNERS Key Highlights QI 2011 organic revenue growth of 26.5%, an over 1,200 basis point increase from Q4 2010 + QI 2011 revenue increased 60.0% to $217.5 million versus $135.9 million in Q1 2010 QI 2011 EBITDA increased 59.1% to $14.8 million versus $9.3 million in Q1 2010 + Net new busines
Slide 4: Consolidated Revenue and Earnings
MDC(M)PARTNERS Consolidated Revenue and Earnings (US$ in mitions, except pecans) yaths Ended March 31, % Change Revenue s 60.0 % Operating Expenses Cost of services sold 059.1) (06) 648 % Office and general expenses 45.7) G43) 334% Depreciation and amortization 0.4) 5.8) 785 % Operating Income (Loss
Slide 5: Summary of Segment Results — Revenue
MDC(K)PARTNERS Summary of Segment Results — Revenue (USS in millions, except percentages) ‘Three Months Ended March 31, 2011 2010 % Change Revenue Strategic Marketing Services S$ 1415 $ 913 55.0 % Performance Marketing Services 76.0 447 70.2 % + Strategic Marketing Services Group: Technology, integr
Slide 6: First Quarter 2011 Revenue Growth by Segment
a MDC(K)PARTNERS First Quarter 2011 Revenue Growth by Segment Strategic Performance Weighted Marketing Marketing Average Services Services Total Acquisition Growth 23.0% 51.7% 32.5% Foreign Exchange Growth 1.0% 1.2% 1.0% Total
Slide 7: Organic Growth Outperformance Over Time
MDC(K)PARTNERS Organic Growth Outperformance Over Time MDC Partners vs. Peers: Trailing 12 Month Organic Revenue 1Q 426.5% 25.0% 20.0% 15.0% 10.0% / 5.0% 0.0% a, iy Rey My My Wy WM Mey M% 10.0% 4 = rme 6.0% + MDC’s organic growth outperformance continues despite more difficult comparisons Note: Peer
Slide 8: First Quarter Revenue by Client Sector
MDC(K)PARTNERS First Quarter Revenue by Client Sector 12011 Q1 2010 Consumer Froducts, ‘Consumer Products, pies Heetheare, 5%-, Auto, 2% ps Technology, 7% Financials, 9% Heattheare, 496-,Auto, 3% Technology, 11%. Financials, 2%, Other, 15% Other, 11% ‘Communications, 12% etal, 22% Conmunications, 17
Slide 9: Summary of Segment Results — EBITDA
MDC(K)PARTNERS Summary of Segment Results — EBITDA (US$ inmallons, except percentages) ‘Three Months Ended March 31, 2011 2010 % Change EBITDA Strategic Marketing Services S$ 150 $ 120 246% margin 10.6% 13.2% Performance Marketing Services 40 07 NM margin 5.3% 15% ‘Marketing Communications 19.0 127
Slide 10: Free Cash Flow
MDC(K)PARTNERS Free Cash Flow Three Months Ended March 31, (USS in miltions) 202010 EBITDA S148 $9.3 ‘Net Income Attibutable to Noncontrolling Interests (1.6) (1.0) Capital Expenditures (ce) (28) Cash Taxes (0.1) (0.6) Cash Interest. net and other (8.4) (6.3) Aes percenages my not foot dio rounding:
Slide 11: Liquidity
10 MDC(K)PARTNERS Liquidity Available Liquidity at March 31, 2011 (US$ in millions) Commitment Under Facility $100.0 Drawn 59.7 Letters of Credit 61 Funds Available Under Facility $342 Total Cash 72.0 Liquidity $412 + Pro forma for the April 19, 2011, senior notes offering which netted proceeds of a
Slide 12: 2011 Financial Outlook
WW 2011 Financial Outlook 2011 Guidance MDC(K)PARTNERS Implied Year over Year* Chan; Revenue EBITDA Free Cash Flow + Change in Working Capital and Other Total Free Cash Flow $850 - $870 million $108 - $112 million $43 - $46 million +85 million $48 - $51 million * Year over year change compares to 20
Slide 13: Appendix
Appendix MDC(K)PARTNERS
Slide 14: Temporal Put Obligations and Impact on EBITDA
MDC(K)PARTNERS Temporal Put Obligations and Impact on EBITDA Estimated Put Impact at March 31, 2011 Payment Consideration Incremental (US$in millions) Cash Stock Total EBITDA in Period 2011 20 06 2.6 3.0 2012 Ba 08 139 19 2013 43 1. 54 17 2014 49 05 54 09 Thereafter 8.0 05 85 19 Total $32.3 $3.5 $35
Slide 15: Balance Sheet: 2016 Senior Notes
MDC(K)PARTNERS Balance Sheet: 2016 Senior Notes Principal Amount $345 Million Date October 23, 2009/May 11, 2010/April 19, 2011 Maturity November 1, 2016 Security Unsecured Coupon 11% Ratings Moody’s - Corporate: B1; Notes: B2 S&P: Corporate: B+; Notes: B+
Slide 16: Balance Sheet: Revolving Credit Facility
MDC(K)PARTNERS Balance Sheet: Revolving Credit Facility $100 Million Type Senior Secured Maturity October 23, 2014 Facility Fee SObps per annum, Drawn Rate Prime + 300bps Covenants + Minimum EBITDA: $85 million - Fixed Charge Coverage Ratio: 1.25:1.0 + Senior Leverage Ratio: 2.0:1.0 + Total Leverage
Slide 17: Summary Cash Flow Data
16 MDC(K)PARTNERS Summary Cash Flow Data Three Months Ended March 31, (USS ix millions) 2011 2010 Cash flows used in continuing operating activities (937.1) (35) Discontinued operations 00. g 2 Cash flows used in continuing investing activities se - oe a Discontinued operations Effect of exchange ra
Slide 18: Definition of Non-GAAP Measures
MDC(M)PARTNERS Definition of Non-GAAP Measures EBITDA: EBITDA isa non-GAAP measure, that represents operating profit plus depreciation and amortization, stock- ‘based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates, Organi