Plan to split MTG into two listed companies Todays presenters Jrgen - PowerPoint PPT Presentation

23 March 2018 Plan to split MTG into two listed companies

Today’s presenters Jørgen Madsen Lindemann Anders Jensen MTG President & MTG Executive Vice President; Chief Executive Officer CEO of Nordic Entertainment Our Content 2 2

Why we are here? MTG – the starting point Proposal to split MTG into two separate listed companies Nordic Entertainment Group New MTG Timeline 3

2017 was MTG’s best year yet 8% organic sales 7% Nordic Ent. 37% MTGx organic 33% total growth & 19% profit organic sales growth sales growth & shareholder return growth & 15% profit growth EBITDA profitable Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 4

We never stand still – transformation is in our DNA 1987 2018 Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 5

Digital transformation & portfolio management Kongregate Baltics Engage InnoGames Hungary Czech Rep. Digital Partners Acquisitions Disposals ESL ESEA Russia Africa EV = 5.9 bn EV = 8.6 bn Trace & Splay DreamHack Ukraine Bulgaria * Zoomin.TV Sappa Refers to acquisitions and divestments from 2015 onwards * Expected to close in Q2 2018 Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 10 6

Plan to split MTG into two listed companies Nordic Entertainment Group New MTG  A pure play in digital entertainment  Nordics leading entertainment provider  Comprising esports (ESL & DreamHack), online  Comprising Nordic Entertainment, MTG Studios and gaming (InnoGames & Kongregate), Zoomin.TV, and Splay Networks other investments  CEO: Anders Jensen  CEO: Jørgen Madsen Lindemann  CFO: TBA  CFO: Maria Redin  Company name: Nordic Entertainment Group  Company name: MTG  Shares will be distributed to MTG shareholders and  Shares will remain listed on Nasdaq Stockholm listed on Nasdaq Stockholm during H2 2018  HQ at Skeppsbron, Sweden  HQ at Ringvägen, Sweden Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 18 7

Compelling rationale – the natural next step Greater focus & clarity • 1 Strategic Serving different target markets • Adapting faster to market dynamics • Aligned accountability & incentivisation 2 • Operational Simpler decision making • Attracting highly skilled talent • Distinct investment cases & equity stories 3 • Financial Facilitates separate funding models & capital allocation • Enables fair valuation of both businesses • Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 18 8

Nordic Entertainment Group operations Sweden Norway Pay TV SVOD streaming Pay TV SVOD streaming Free TV AVOD streaming Free TV AVOD streaming Radio Radio Triple Play Denmark Pay TV SVOD streaming Finland Pay TV SVOD streaming Free TV AVOD streaming AVOD streaming MTG Studios (17 countries) Splay Networks Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 18 9

Nordic Entertainment Group – a powerhouse Net Sales EBITDA before (SEKm) Group central costs (SEKm)  Leading entertainment provider with a uniquely integrated structure CAGR CAGR  Nordic Entertainment: Pay- & Free-TV + +6% +8% 13,684 1,771 leading pay and free streaming services 12,876 12,219 1,557  MTG Studios: Nordic’s leading content 1,530 production company 6,867 6,272  Splay: Nordic’s leading digital video 5,831 network  Undisputed content leadership: sports, acquired content & top quality original 5,094 4,866 4,656 productions from MTG Studios and Splay  Leading digital positions through Viaplay, Viafree, Viareal, I Like Radio & Splay 1,897 1,986 1,810 -78 -159 -263  Digital revenues increased by 31% in 2017 to 2015 2016 2017 2015 2016 2017 account for 19% of total sales Pay-TV Free-TV MTG Studios & Splay Eliminations Note: USD transaction headwind on EBIT amounted to SEK 187m, 184m and 78m for 2015, 2016 and 2017 respectively Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 10 18

Nordic Entertainment Group digital growth drivers Started streams Started streams BTV subs CAGR CAGR CAGR +49% +43% +18% 2015 2016 2017 2015 2016 2017 2015 2016 2017 Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 11

Nordic Entertainment Group – key priorities Capitalise on content and digital leadership positions Cost control & continue to shift investments to content & online Build a strong international IP, production and distribution house Expand product offering in each market Look for structural opportunities to drive convergence Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 12

New MTG – digital experiences with a global appeal Esports Gaming Digital Video Content Other holdings Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 18 13

New MTG – a digital hyper-growth story  A pure-play global digital entertainment Net Sales EBITDA before company (SEKm) Group central costs (SEKm)  Esports: The world’s leading esports company with category brand leaders that 2,810 are shaping the future of the industry 36  Online gaming: 2 proven concepts with 1,234 developing & publishing capabilities across all platforms  Digital video content: Helps influencers, 1,206 brands & creators to succeed on digital & -170 social platforms 1,370  Successful M&A record. Investing in globally 1,012 attractive digital entertainment verticals with portfolio synergies 193 206  VC fund to provide new opportunities to 2016 1) 2017 2016 2017 secure access to future M&A targets Online Gaming Esports Digital Video Content excl. Splay 1) Prize money from 3rd party esport events has been excluded from 2017. FY16 sales would have been SEK 98m lower if presented on the same basis. Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 18 14

New MTG - key priorities Become Europe’s preferred partner for digital entertainment companies around the world Maintain position as the world’s #1 esports company Further develop our positions in online gaming Selective M&A to expand position in existing verticals and exploit opportunities in new verticals Look for strategic partnerships to drive further value creation Our Content 50 MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 18 15

The timetable Date What How MTG announces intention to split the Group into two separate listed companies by distribution of all shares in Nordic Entertainment Group 23 March 2018 Press release and conference call (Nordic Entertainment, MTG Studios, Splay Networks) to MTG shareholders H2 2018 Publication of Information Brochure MTG.com Resolution/decision on distribution of the shares of Nordic H2 2018 Extraordinary General Meeting Entertainment Group to the shareholders of MTG AB Publication of the listing prospectus and Nordic Entertainment Group MTG.com and H2 2018 listed as a separate company Nasdaq Stockholm, Sweden Note: subject to changes Our Content MTG – the starting point Proposal to split the Group Nordic Entertainment Group New MTG Timeline 16

Summary Creates two publicly listed companies that are shaping the future of their respective industries with leading brands Provides both businesses with improved focus and agility to capitalise on growth opportunities and drive shareholder value Provides two distinct investment cases with clear financial profiles and capital structures The time is right – decision taken from a position of strength. Robust financial performance, strong leadership teams and an inspired workforce Our Content 50 18 17

FIND OUT MORE @MTG.COM AND FOLLOW US! www.youtube.com/ www.instagram.com/ Modern Time Group MTG AB @mtgab facebook.com/mtgab MTGModernTimesGroup moderntimesgroup