Final Results Presentation Year ended 30 April 2011 July 2011 an - - PowerPoint PPT Presentation

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Final Results Presentation Year ended 30 April 2011 July 2011 an - - PowerPoint PPT Presentation

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Final Results Presentation Year ended 30 April 2011 July 2011 an Ebiquity company Review of the year Year ended 30 April 2011 2 Strong financial performance delivering total revenue up 108% with operating profit doubling to 5.3m

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SLIDE 1 an Ebiquity company

Final Results Presentation Year ended 30 April 2011

July 2011

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SLIDE 2 2

Review of the year

Year ended 30 April 2011

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SLIDE 3
  • International revenues now represents 71% of total Group revenue

(2010: 38%)

  • Underlying operating profit of £5.3m (2010: £2.6m)
  • Underlying profit before tax of £4.8m (2010: £2.3m)
  • Underlying EPS of 6.02p (2010: 5.55p)
3

Strong financial performance delivering total revenue up 108% with operating profit doubling to £5.3m

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SLIDE 4
  • Integration of Xtreme Information completed ahead of schedule and

below budget

  • Ebiquity Germany, following acquisitions, now represents 13% of total

worldwide revenue

  • US business grows at over 40% as media transparency becomes

increasingly important

  • Newly established Ebiquity Italy growing at almost 25% per year
  • Recently acquired market leading Russia media measurement and

benchmarking business

4

Further acquisitions build international growth

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SLIDE 5
  • Acquisition of Echo Research Group adds “earned” and “social” media

to offering

  • Business drivers continue to be positive despite economic uncertainty
  • Ebiquity restructured into clearly defined offerings
  • New data processing centre in Newcastle adding to international

capabilities

5

Business continues to evolve to capitalise on global demand

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SLIDE 6 6

New data processing centre

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SLIDE 7 7

Key Business Drivers

7
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SLIDE 8

New business structure to reflect new capabilities

Advertising Intelligence Media Effectiveness Digital Reputation & PR Media Technology

Practice

8
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SLIDE 9 9

Greater geographic reach

9

Office Partners

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SLIDE 10 10

Echo

New skills for a new world

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SLIDE 11 11

New Product Development Seasonality Economy Competitor Advertising Reputation In-house Media Price Promotions Retail Environment Regulatory Environment

Business Performance

Offline Media Organisational Changes Digital/Social Media Sponsorship

Managing and measuring business performance

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SLIDE 12 12

Business Performance

“Paid Media” “Unpaid Media”

Outbound Messaging Customer Empowerment Brand reputation and performance measurement

Ebiquity’s unique capabilities

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SLIDE 13 13

Redefining the media landscape

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SLIDE 14

50 staff + 200 analysts Offices in London, Paris, New York and Singapore Member of UN Global Compact Winner of 89 Industry Awards, including Platinum & Golds for Integrated Research all Echo research complies with the MRS Code of Conduct, ESOMAR, CASRO & ISO 9000:2001

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SLIDE 15 15

Monitoring Social Media

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SLIDE 16 16

Identifying source and trends

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SLIDE 17 17
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SLIDE 18

Ebiquity / Echo Suite of Services

18 Identify best customers Target advertising Are these conversations aligned with the image I want? Monitor what’s being said about the competition Developing the
  • ptimum message
strategy Allows you to track movement in brand / ad awareness as a result of media efforts Who are my customers and what motivates them? What are their media consumption habits and shopping behaviours? Position your brand based on market needs and wants Create buzz around a new product or service

Advertising Testing Research Improve Media ROI Media/PR Monitoring Customer Segmentation Brand / Advertising Tracking Thought Leadership and PR Research

Is my brand recognition increasing in the marketplace? Is my target market aware of our advertising? Is it changing their image of us? Improve media agency’s \appearance How do I take
  • wnership of
important issues in my industry? Am I getting the most out of my media spend? Can I spend less and get the same return? Can my plan be improved before I commit budget? What’s being said about my brand, both
  • ffline and
  • nline?
What is the right message for our target audience?

Impact analysis

Understand if your reputation is at risk Understand and refine competitive positioning What is the impact of my media spend on the perceptions, sentiment and behavior of our stakeholders ?
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SLIDE 19

Outlook

1. Our role as an independent provider of insights, based on the clear analysis of available data, will continue to grow in importance 2. We expect continued strong performance from our overseas offices 3. We will continue to build our business internationally in line with our clients’ needs 4. The more complex the market, the greater the supply of data and the more crucial it will be for clients to make sense of it all 5. This simple fact is the basis of our continuing confidence 6. We expect to see continued margin improvement and earnings growth

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SLIDE 20 20

Financial Summary

Year ended 30 April 2011

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SLIDE 21 21

Revenue

2011 2010 £’000 £’000 Var Analytics 17,900 15,197 18% Platform 26,265 6,021 336% Total 44,165 21,218 108% Revenue increase of 108%...Comfortably in line with expectation

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SLIDE 22 22

Revenue

International revenue: non UK sourced revenue, or UK sourced revenue where marketing activity is analysed in more than one country

A more international service

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SLIDE 23 23

Revenue

A more balanced offering

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SLIDE 24 24

Gross margins

56% 55%

Total

57% 51%

Platform

54% 56%

Analytics

Total gross profit £24,799k (2010: £11,598k)

2011 2010

Positive impact of acquisitions and synergies implemented earlier than planned

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SLIDE 25 25

Underlying operating profit

2011 2010 £’000 £’000 Var Analytics 7,123 7,603 (6)% Platform 7,739 1,284 503% Central (9,564) (6,244) (53)% Total 5,298 2,643 100% Positive impact of acquisitions and early synergy release

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SLIDE 26 26

Underlying operating margin

12.0% 12.5%

Operating profit (EBIT) EBITDA

14.6% 15.0%

2011 2010

Lower than last year as forecast, but ahead of expectation

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SLIDE 27 27

Highlighted items

2011 2010 Cash Non cash Total Total

Recurring: Share based expenses 1,038 1,038 308 Amortisation of purchased intangibles 1,549 1,549 412

  • 2,587

2,587 720 Non recurring: Integration costs 1,550 1,550 212 Severance costs 1,405 1,405 1,132 Property costs 421 301 722 122 Acquisition costs 282 282

  • 3,658

301 3,959 1,466 Total 3,658 2,888 6,546 2,186

High planned non-recurring integration costs to release significant cost synergies

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SLIDE 28 28

Profit before tax and EPS

2011 2010 £’000 £’000 Var

Underlying operating result 5,298 2,643 100% Highlighted items (6,546) (2,186) Reported operating result (1,248) 457 (373)% Net finance costs (528) (352) Share of associates

  • (5)

Reported result before tax (1,776) 100 (1,876)% Underlying result before tax 4,770 2,286 109% Underlying diluted EPS 6.02p 5.55p 8%

Impact of significant planned restructuring costs on reported result…strong EPS growth

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Financing analysis

As at 1 May 2010 Year ended 30 April 2011 As at 30 April 2011 Drawn Repaid Term loan 7,975 (2,040) 5,935 Revolving credit facility 1,750 1,750 Acquisition fund

  • Gross debt

7,975 1,750 (2,040) 7,685 Cash 5,243 3,158 Loans to associates² 285

  • Net debt

2,447 4,527 Gross debt/EBITDA³ 1.3 1.2 Net debt/EBITDA³ 0.4 0.7

¹ £750k RCF and £1,500k acquisition fund ² Ownership changed from associate to subsidiary during the year ³ 2010 Based on pro forma 2010 results; 2011 based on actual 2011 result

£2.25m of available facility¹

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SLIDE 30 30

Financial summary

  • Significant increase in company size
  • Strong international growth
  • A more balanced mix of global services
  • Cost synergies delivered early
  • Conservatively financed
  • Comfortably ahead of all market expectations

Significant increases on prior year, and ahead of all market expectations

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SLIDE 31 31

Financial Appendices

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SLIDE 32

Appendix: Summary of results

32

Year ended 30 April 2011 Market Expectation Year ended 30 April 2010 Revised published 19/1/11 Original published 23/7/10 Revenue 44,165 43,100 41,900 21,218 Underlying operating profit 5,298 4,900 4,600 2,643 Underlying operating profit mgn 12.0% 11.3% 10.9% 12.5% Underlying profit before tax 4,770 4,400 4,200 2,286 Underlying diluted EPS 6.0p 5.4p 5.4p 5.6p Net debt 4,527 4,600 3,200 2,447

Significant increases on prior year, and ahead of all market expectations

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SLIDE 33 33

Appendix: Acquisitions during the year

Billetts Germany Media Advisor Italy Buro CP Germany Total

Acquisition date 1 May 2010 28 May 2010 1 November 2010 Acquisition detail Increased stake from 10% to 51% 51% acquisition Trade and assets purchase Segment Analytics Analytics Platform Cash up front £20k £170k £70k £260k Investment already held £13k

  • £13k

Deferred consideration

  • £309k

£374k £683k Fair value of consideration £33k £479k £444k £956k Fair value of assets acquired £38k £194k

  • £232k

Non controlling interest (£18k) (£95k)

  • (£113k)

Goodwill arising on acquisition £13k £380k £444k £837k

Continued global expansion

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Appendix: Transactions post year end

Acquisition of Echo Research Group Acquisition of Joined Up Media Company Disposal of Newslive

Nature of business Global reputation analysis, media measurement, stakeholder research Media auditing in Russia and CEE Editorial monitoring in the UK Operations London, New York, Paris, Singapore London, Moscow London Segment Analytics Analytics Platform Transaction date 20 May 2011 27 May 2011 1 July 2011 Transaction detail 100% acquisition 50.1% acquisition Trade/assets disposal Cash up front £3,500k £356k £167k Deferred consideration maximum £6,500k £844k

  • Total potential consideration/proceeds

£10,000k £1,200k £167k Earn out basis 2 years based on revenue targets 2 years based on revenue/profit mgns n/a Key financials Mar 11: Rev £5m, u/l op profit £0.5m, 45 staff Mar 11: Rev £0.8m, u/l op profit £0.1m, 7 staff n/a

Improved client offering

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Appendix: Statement of financial position

2011 2010

Non current assets

Goodwill 31,457 30,235 Purchased intangibles 8,350 9,291 Other 4,247 3,418 44,054 42,944

Current assets

Trade debtors 10,143 8,300 Accrued income 2,130 923 Cash 3,158 5,243 Loans to associates
  • 285
Bank security deposits 200 300 Prepayments 1,573 1,566 Other 638 584 17,842 17,201

Current liabilities

Trade creditors 3,861 2,993 Loans 3,721 1,994 Deferred income 8,707 8,567 Accruals 4,028 3,248 Other 3,766 3,087 24,083 19,889

Non current liabilities

Loans 3,643 5,575 Deferred tax 2,171 2,608 Other 948 907 6,762 9,090

Net assets

31,051 31,166
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Appendix: Cash flow statement

2011 2010

Cash generated from operations

1,430 3,243 Finance expense (365) (271) Income taxes paid (757) (551)

Net cash from operating activities

308 2,421

Investing activities

Acq’n of subsidiaries, net of cash acquired (898) (326) Purchase of PPE (1,260) (164) Capitalised development costs (77) (135) Repayment of loan from associates
  • 66
Finance income 2 14 (2,233) (545)

Financing activities

Issue of new shares 38 750 New borrowings 1,750 8,000 Loan repayments (1,982) (5,884) Bank loan fee/securities 100 (506) Loan note issue costs
  • (217)
Repayment of finance leases (21)
  • (115)
2,143

Net (decrease)/increase in cash

(2,040) 4,019
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SLIDE 37 37

Appendix: International revenue

¹ International revenue: non UK sourced revenue, or UK sourced revenue where marketing activity is analysed in more than one country

US domestic 15% (2010: 11%)

38% multi territory contracts (2010: 27%)

Mainland Europe domestic 14% (2010: nil) AsiaPac domestic 4% (2010: nil) International revenue¹ doubled to 71% of group revenue (2010: 38%)