Q3 Third quarter 2019 Flemming Breinholt, CEO and Dora Brink - - PowerPoint PPT Presentation

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Third quarter 2019

Flemming Breinholt, CEO and Dora Brink Clausen, CFO | 28 November 2019

Q3

Q3 2019 PRESENTATION

Q3 highlights and operational update Flemming Breinholt

2 Q3 2019 PRESENTATION

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For legal and tax professionals in Denmark and Sweden

Karnov – The leading B2B platform

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PRACTITIONERS

Q3 2019 PRESENTATION

Q3 2019 PRESENTATION 4

Operational highlights

Continued roll-out of new joint platform JUNO Now 98% of 35.000+ users are

• nboarded

Commercial launch has begun on November 1st. Karnov’s old platform already closed and the Zeteo platform from Norstedts Juridik to be closed down soon.

Key comments

Successful roll-out of JUNO

Q3 2019 PRESENTATION 5

Operational highlight

Enquiry among lawyers and others in the legal industry in Denmark and Sweden 3.500 respondents Significant customer interest Significant media coverage

Key comments

Future Lawyer Survey

Steady growth with higher margin +6%

Net sales

+4%

Organic growth

+1.1 pp

Adjusted EBITA margin

2.8

Leverage

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Financial highlights year to date

Q3 2019 PRESENTATION

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5% net sales growth Sales driven by upselling to existing customers Unchanged adjusted EBITA Lower adjusted EBITA margin due to lower capitalization rate New tax magazine launched in collaboration with Danish auditor association, FSR.

Continued good performance in Denmark

Q3 2019 PRESENTATION

Key comments to Q3

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11% net sales growth 15% increase in adjusted EBITA Sales driven by both online and offline impacted by timing effects in offline Positive market response to the new JUNO platform

Sales in Sweden boosted by offline increase

Q3 2019 PRESENTATION

Key comments to Q3

Financial development Dora Brink Clausen

9 Q2 2019 PRESENTATION

…but diluted margins slightly

GROUP

Q3 2019 PRESENTATION 10

Offline increase, improved sales and EBITA

176 190

50 100 150 200 Q3 2018 Q3 2019 Net Sales, SEKm

+8%

+6%

70 74

39%

Q3 2018 Q3 2019 10 20 30 40 50 60 70 80 Adjusted EBITA, SEKm and margin %

39.5% 38.9%

… due to strong online trend and offline timing effectsUP

Q3 2019 PRESENTATION 11

Key comments

Net sales growth of 7.6% Organic growth of 5.8% and currency effects of 1.8%. Online sales steady growth Sales boosted by timing effects on offline products Both DK and SE contributed to higher sales

Continued steady sales growth

GROUP

194 166 176 179 205 173 190

50 100 150 200 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Net Sales, SEKm

+7.6%

GROUP

Q3 2019 PRESENTATION 12

Continued year-over-year improvement in adjusted EBITA Improvements due to higher sales and good cost control Adjusted EBITA margin declined 0.6 pp due to product mix and SEK 4 m higher amortisation.

Continued profit improvement

76 55 70 61 85 60 74

39% 33% 40% 34% 42% 35% 39%

10 20 30 40 50 60 70 80 90 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Adjusted EBITA and margin, SEKm and %

+6%

Key comments

Q3 2019 PRESENTATION 13

Continued trend to online and subscriptions

77% 78% 76% 23% 22% 24%

0% 20% 40% 60% 80% 100% Q3 2018 Q3 2019 FY 2018 Sales split online/offline, % Online Offline

83% 84% 82% 17% 16% 18%

0% 20% 40% 60% 80% 100% Q3 2018 Q3 2019 FY 2018 Sales split subscription/non-subscription, % Subscription Non-subscription 1 pp increase in

• nline sales

1 pp increase in subscription-based sales

DENMARK

Q3 2019 PRESENTATION 14

Key comments

5% net sales growth 2% organic growth in line with expectations Currency effect added 3% Sales driven by upselling to existing customers Unchanged adjusted EBITA Lower adjusted EBITA margin due to lower capitalization rate

Continued good performance in Denmark

102 94 105 96 109 99 110 20 40 60 80 100 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Net Sales, SEKm

35 40 46 36 44 41 46 34% 42% 44% 38% 41% 41% 42%

10 20 30 40 50 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Adjusted EBITA, SEKm and %

+5% +0%

SWEDEN

Q3 2019 PRESENTATION 15

Offline sales increased in Sweden

92 72 72 82 96 74 79

20 40 60 80 100

Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019

Net Sales, SEKm

41 16 24 24 41 20 28

45% 21% 34% 29% 43% 26% 35% 10 20 30 40 50

Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019

Adjusted EBITA, SEKm and margin, %

+11% +15%

Key comments

Net sales grew by 11% Continued steady growth in online Sales boosted by timing effects in offline Adjusted EBITA improved by 15% or SEK 4 m despite SEK 6 m higher D&A Adjusted EBITA margin up 1 pp due to net sales growth and good cost control

GROUP

Q3 2019 PRESENTATION 16

Key comments

Adjusted operation cash flow improved by SEK 14 m to SEK 2 m due to better EBITDA and working capital Cash conversion rate positive also in Q3 Leverage at 2.8 vs 2.7 in June

Expected weak seasonal cash flow improved

177 23

• 12

120 163 18 2

219% 37%

• 16%

177% 168% 25% 2%

• 50

50 100 150 200 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019

• Adj. operating cash flow, SEKm

and cash conversion, %

Growth

Annual organic net sales growth of 3-5% in the medium term, supplemented by selective acquisitions.

Profitability

A higher adjusted EBITA margin in the medium term.

Capital structure

Net debt to adjusted EBITDA

• f no more than 3.0. This level may

temporarily be exceeded, for example as a result of acquisitions.

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Performing in line with financial targets

Q3 2019 PRESENTATION

4%

+1.1 pp

2.8x

Year-to-date performance

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Q3 2019 PRESENTATION

Summary of first nine months

YTD as communicated at listing

– Organic growth of 4% – Adjusted EBITA margin up 1.1 pp – Leverage below 3x 1

Solid capital structure created Solid base to grow business further

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JUNO rollout progressing well

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Q&A

Better decisions, faster

Find what you need, trust what you find and do it quickly. For more information visit www.karnovgroup.com/en/section/investors/

Q3 2019 PRESENTATION

Appendix

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Key ratios per quarter

Q2 2019 PRESENTATION

Key ratios per quarter Q3 Q2 Q1 Q4 Q3 TSEK 2019 2019 2019 2018 2018 Net sales 189.533 173.440 204.931 178.817 176.175 Organic growth, % 5,8% 3,0% 3,2% 0,8% 4,8% EBITA 69.106 30.458 67.501 36.529 60.194 EBITA margin, % 36,5% 17,6% 32,9% 20,4% 34,2% Adjusted EBITA 73.756 60.123 85.331 60.642 69.631 Adjusted EBITA margin, % 38,9% 34,7% 41,6% 33,9% 39,5% Net result 32.093

• 44.303

7.852

• 15.261

6.540 Adjusted cash flow from operating activities 1.936 18.097 163.384 120.314

• 12.119

Q2 2019 PRESENTATION 22

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