Company presentation March 2019
Disclaimer This document, which has been issued by Axel Springer SE (the "Company"), comprises the written materials/slides for a presentation of the management. Whilst all reasonable care has been taken to ensure that the information and facts stated herein are accurate and that the opinions and expectations contained herein are fair and reasonable no representation or warranty, express or implied, is given by or on behalf of the Company, any of its directors, or any other person as to the accuracy or completeness of the information or opinions contained in this document and no liability is accepted for any such information or opinions. This document contains forward looking statements which involves risks and uncertainties. These forward looking statements speak only as of the date of this document and are based on numerous assumptions which may or may not prove to be correct. The actual performance and results of the business of the Company could differ materially from the performance and results discussed in this document. The Company undertakes no obligation to publicly update or revise any forward looking statements or other information contained herein whether as a result of new information, future events or otherwise. This document does not constitute or form any part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities in any jurisdiction, nor shall they or any part of them nor the fact of their distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto. 2 Company presentation
Investment highlights Axel Springer: Digital company with 71% of revenues and 84% of adj. EBITDA from digital activities Organic growth in digital revenues at 9.6% in FY/18 – investing into further growth potential in digital A leading player in digital classifieds – classifieds contributing 61% to adj. Group EBITDA A leading digital publisher – attractive reach and strong brands delivering profitable growth in digital content Strong alignment of shareholder and management interests : Total shareholder return-based incentivization and management share ownership of ~3% High M&A firepower due to strong balance sheet and free cash-flow High and stable or slightly growing dividend 3 Company presentation
Axel Springer financials at a glance Revenues by segment 1 Guidance 2% 13% 2018 Outlook 2019 (reported) Outlook 2019 (organic 4 ) 38% Classifieds Media Low to mid single-digit Revenues in €m 3,180.7 Low single-digit % growth News Media % growth Marketing Media 47% EBITDA (adj.) in € m / 737.9 / Low to mid single-digit On prior-year level Services / Holding margin in % 23.2% % growth EBIT (adj.) in € m / 527.9 / Adj. EBITDA by segment 1,2 Low single-digit % decline Low single-digit % growth 16.6% margin in % Stable to low single-digit 11% EPS (adj.) in € 2.73 Single-digit % growth % decline DPS (FY 2018) in € 3 2.10 --- --- 28% 61% 1) Based on FY/18 figures. 2) Negative EBITDA S/H allocated proportionally to operative segments. 3) Subject to approval by AGM. 4) Adjusted for consolidation and FX effects. 4 Company presentation
2018: Growth in revenues, profits and dividend Revenues €3,180.7m (+4.1% reported, +3.8% organically) adj. EBITDA €737.9m (+14.3% reported, +8.5% organically) adj. EBIT €527.9m (+4.7% reported, +6.4% organically) adj. eps €2.73 (+5.1% reported, +8.3% organically) Dividend proposal of €2.10 (PY: €2.00) 5 Company presentation
84% of adj. EBITDA from digital activities – digital revenues with organic growth of 9.6% in FY/18 Revenues adj. EBITDA 71% 84% digital digital 6 Company presentation
We have achieved our goals for 2018 Further growth Deliver on stable Break-even Explore further in classifieds at Insider Inc. adj. EBITDA potential from guidance for technology & data News Media 7 Company presentation
Classifieds 2018: Strong growth and attractive investments Continued strong organic topline growth of 11.4% – StepStone again the growth engine with 16.9% organic growth Classifieds most important profit contributor – 60.5% of adj. EBITDA Successful integration of Logic-Immo (Real Estate) and Universum (Jobs) Investments into hybrid real estate agents to tap into additional revenue pools 8 Company presentation
News Media 2018: Delivering on targets – excellent progress with digital content Financial targets achieved Insider Inc.: Revenue target and profitability achieved in FY/18, $ became second-most-read general news brand in the United States Excellent performance at upday and Politico – both on track to profitability in 2019 Digital subscriptions at BILD and WELT reach 512k at year-end (+10.9% yoy) 9 Company presentation
Insider Inc.: Second most-read general news brand in the US General news category Business news category Total digital unique visitors in million Total digital unique visitors in million 134 76 72 60 56 91 90 87 84 47 73 70 70 64 29 28 23 19 >40% 20% Source: Comscore, 12/2018. Company presentation 10
Outlook 2019 Selectively invest for further top- Continue with our successful line growth path ▪ Further strengthen and ▪ Focus on classifieds and leverage Stepstone‘s market content – Further growth of position classifieds, further digitization + ▪ Expanding product range in of content Real Estate classifieds ▪ Leverage potential from ▪ Insider Inc.: Re-investing near- technology and data term profits for further growth Create mid- and long-term shareholder value 11 Company presentation
Outlook 2019 – Group reported organic 1 Revenues Low single-digit % growth Low to mid single-digit % growth Adj. EBITDA On prior-year level Low to mid single-digit % growth Group Adj. EBIT Low single-digit % decline Low single-digit % growth Stable to low single-digit % Adj. eps Single-digit % growth decline 1) Adjusted for consolidation and FX effects. 12 Company presentation
Outlook 2019 – Segments organic 1 reported Revenues Classifieds Media high single-digit to low double-digit % growth high single-digit to low double-digit % growth News Media low to mid single-digit % decline low single-digit % decline low single-digit % decline high single-digit % growth Marketing Media Services/Holding low double-digit % decline low double-digit % decline Adj. EBITDA Classifieds Media low to mid single-digit % growth mid single-digit % growth News Media on prior-year level on prior-year level Marketing Media low to mid single-digit % growth high single-digit to low double-digit % growth double-digit % decline 2 double-digit % decline 2 Services/Holding Adj. EBIT Classifieds Media on prior-year level low to mid single-digit % growth News Media low single-digit % decline on prior-year level Marketing Media low single-digit % decline high single-digit % growth high single-digit to low double-digit % decline 2 high single-digit to low double-digit % decline 2 Services/Holding 1) Adjusted for consolidation and FX effects. 2) Higher negative EBITDA/EBIT. 13 Company presentation
Financials 2018
2018 adj. Group EBITDA up 14.3%, organic increase of 8.5% org. 1 org. 1 in €m 2018 yoy Q4/18 yoy Revenues 3,180.7 4.1% 3.8% 854.7 2.6% 4.4% 2,159.4 7.2% 6.3% 590.2 3.4% 5.5% Advertising 591.7 -6.5% -4.8% 142.6 -4.5% -2.3% Circulation 429.6 5.2% 4.7% 121.8 7.4% 8.2% Other adj. EBITDA 737.9 14.3% 8.5% 196.5 14.0% 13.7% 23.2% 2.1pp 23.0% 2.3pp Margin FY2018 ▪ Strong organic increase of adj. EBITDA in Q4/18 (+13.7%) driven by Jobs Classifieds and News Media Adj. EBIT of €527.9m in FY/18 up by 4.7% yoy (organically up by 6.4% yoy) ▪ 1) Adjusted for consolidation and FX effects, as well as for IFRS 16 effects for adj. EBITDA. 15 Company presentation
Classifieds Media: adj. EBITDA up 26.5% in Q4/18, organic increase of 21.0% org. 1 org. 1 1) Adjusted for consolidation and FX effects, as well as in €m 2018 yoy Q4/18 yoy for IFRS 16 effects for adj. EBITDA. Revenues 1,212.5 20.3% 11.4% 322.3 22.8% 13.3% 1,167.4 17.9% 11.8% 306.8 19.0% 13.8% Advertising 45.1 >100 % -12.5% 15.5 >100 % -14.9% Other adj. EBITDA 487.2 17.9% 11.4% 133.6 26.5% 21.0% 40.2% -0.8pp 41.5% 1.2pp Margin FY2018 ▪ Both revenue and adj. EBITDA increase driven by strong organic growth as well as consolidation effects from Logic-Immo (Real Estate) and Universum (Jobs). Adj. EBITDA also positively impacted by effects from adoption of IFRS 16 ▪ Margin up slightly in Q4/18 yoy, FY/18 margin down due to investments ▪ Adj. EBIT of €406.7m up by 12.7% yoy (organically up by 10.6% yoy) 16 Company presentation
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